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Previous: TAX EXEMPT MONEY FUND OF AMERICA, 497J, 2000-03-17 |
Next: FEDERAL AGRICULTURAL MORTGAGE CORP, 10-K, 2000-03-17 |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
| Filed by the Registrant /x/ |
||
| Filed by a Party other than the Registrant / / | ||
| Check the appropriate box: |
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| / / | Preliminary Proxy Statement | |
| / / | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
| /x/ | Definitive Proxy Statement | |
| / / | Definitive Additional Materials | |
| / / | Soliciting Material Pursuant to §240.14a-11(c) or §240.14a-12 |
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| IN FOCUS SYSTEMS, INC. |
| (Name of Registrant as Specified In Its Charter) |
| |
| (Name of Person(s) Filing Proxy Statement, if other than the Registrant) |
Payment of Filing Fee (Check the appropriate box):
| /x/ | No fee required. | |||
| / / | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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| (1) | Title of each class of securities to which transaction applies: |
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| (2) | Aggregate number of securities to which transaction applies: |
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| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
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| (4) | Proposed maximum aggregate value of transaction: |
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| (5) | Total fee paid: |
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| / / |
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Fee paid previously with preliminary materials. |
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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. |
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(1) |
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Amount Previously Paid: |
| (2) | Form, Schedule or Registration Statement No.: |
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| (3) | Filing Party: |
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| (4) | Date Filed: |
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IN FOCUS SYSTEMS, INC.
27700B S.W. Parkway Avenue
Wilsonville, Oregon 97070
March 17, 2000
Dear Shareholders:
Our Annual Meeting of Shareholders will be held on Wednesday, April 19, 2000, at 1:00 p.m., Pacific Daylight Savings Time, at the Portland Art Museum, Grand Ballroom, 1219 SW Park Avenue, Portland, Oregon 97205. You are invited to attend this meeting to give us an opportunity to meet you personally, to allow us to introduce to you the key management of your Company and its directors, and to answer any questions you may have.
The formal Notice of Meeting, the Proxy Statement, the proxy card and a copy of the Annual Report to Shareholders describing the Company's operations for the year ended December 31, 1999 are enclosed.
I hope that you will be able to attend the meeting in person. Whether or not you plan to attend the meeting, please sign and return the enclosed proxy card promptly. A prepaid return envelope is provided for this purpose. Your shares will be voted at the meeting in accordance with your proxy.
If you have shares in more than one name, or if your stock is registered in more than one way, you may receive multiple copies of the proxy materials. If so, please sign and return each proxy card you receive so that all of your shares may be voted. I look forward to meeting you at the Annual Meeting.
Very truly yours,
IN FOCUS SYSTEMS, INC.
JOHN
V. HARKER
Chairman of the Board
IN FOCUS SYSTEMS, INC.
27700B S.W. Parkway Avenue
Wilsonville, Oregon 97070
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held On April 19, 2000
To the Shareholders of In Focus Systems, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of IN FOCUS SYSTEMS, INC. (the "Company"), an Oregon corporation, will be held at the Portland Art Museum, Grand Ballroom, 1219 SW Park Avenue, Portland, Oregon 97205, on Wednesday, April 19, 2000, at 1:00 p.m., Pacific Daylight Savings Time. The purposes of the Annual Meeting will be:
The Board of Directors has fixed the close of business on February 29, 2000, as the record date for determining shareholders entitled to notice of and to vote at the meeting or any adjournment thereof. Only holders of record of Common Stock of the Company at the close of business on the record date will be entitled to notice of and to vote at the meeting and any adjournment thereof. Further information regarding voting rights and the matters to be voted upon is presented in the accompanying proxy statement.
All shareholders are cordially invited to attend the Annual Meeting. A review of the Company's operations for the year ended December 31, 1999 will be presented. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND PROMPTLY RETURN THE ENCLOSED PROXY CARD, WHICH YOU MAY REVOKE AT ANY TIME PRIOR TO ITS USE. A prepaid, self-addressed envelope is enclosed for your convenience. Your shares will be voted at the meeting in accordance with your proxy. If you attend the meeting, you may revoke your proxy and vote in person.
By Order of the Board of Directors,
JOHN
V. HARKER
Chairman of the Board
Wilsonville,
Oregon
March 17, 2000
IN FOCUS SYSTEMS, INC.
27700B S.W. Parkway Avenue
Wilsonville, Oregon 97070
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To Be Held On April 19, 2000
Solicitation and Revocation of Proxies
This Proxy Statement and the accompanying Annual Report to Shareholders, the Notice of Annual Meeting and the proxy card are being furnished to the shareholders of In Focus Systems, Inc., an Oregon corporation (the "Company"), in connection with the solicitation of proxies by the Company's Board of Directors for use at the Company's 2000 Annual Meeting of Shareholders (the "Annual Meeting") to be held at the Portland Art Museum, Grand Ballroom, 1219 SW Park Avenue, Portland, Oregon 97205, on Wednesday, April 19, 2000, at 1:00 p.m. Pacific Daylight Savings Time and any adjournment thereof. The solicitation of proxies by mail may be followed by personal solicitation of certain shareholders, by officers or regular employees of the Company. All expenses of the Company associated with this solicitation will be borne by the Company.
The two persons named as proxies on the enclosed proxy card, John V. Harker and E. Scott Hildebrandt, were designated by the Board of Directors. All properly executed proxies will be voted (except to the extent that authority to vote has been withheld) and where a choice has been specified by the shareholder as provided in the proxy card, it will be voted in accordance with the specification so made. Proxies submitted without specification will be voted FOR Proposal No. 1 to elect the nominees for directors proposed by the Board of Directors and FOR Proposal No. 2 to ratify the appointment of Arthur Andersen LLP as independent accountants for the Company.
A proxy may be revoked by a shareholder prior to its exercise by written notice to the Secretary of the Company, by submission of another proxy bearing a later date or by voting in person at the Annual Meeting. Such notice or later proxy will not affect a vote on any matter taken prior to the receipt thereof by the Company.
These proxy materials and the Company's 1999 Annual Report to Shareholders are being mailed on or about March 17, 2000 to shareholders of record on February 29, 2000 of the Company's Common Stock. The principal executive office and mailing address of the Company is 27700B S.W. Parkway Avenue, Wilsonville, Oregon 97070.
1
Voting at the Meeting
The shares of Common Stock constitute the only class of securities entitled to notice of and to vote at the meeting. In accordance with the Company's Bylaws, the stock transfer records were compiled on February 29, 2000, the record date set by the Board of Directors, for determining the shareholders entitled to notice of, and to vote at, this meeting and any adjournment thereof. On that date, there were 23,009,867 shares of Common Stock outstanding and entitled to vote.
Each share of Common Stock outstanding on the record date is entitled to one vote per share at the Annual Meeting. If a quorum is present at the Annual Meeting: (i) the four nominees for election as directors who receive the greatest number of votes cast for the election of directors by the shares of Common Stock present in person or represented by proxy at the meeting and entitled to vote shall be elected directors and (ii) Proposal No. 2 to ratify the appointment of Arthur Andersen LLP as independent accountants for the Company will be approved if the number of votes cast in favor of the proposal exceeds the number of votes cast against it.
With respect to the election of directors, directors are elected by a plurality of the votes cast and only votes cast in favor of a nominee will have an effect on the outcome. Therefore, abstention from voting or nonvoting by brokers will have no effect thereon. With respect to voting on Proposal No. 2, abstention from voting or nonvoting by brokers will have no effect thereon.
2
ELECTION OF DIRECTORS
(Proposal No. 1)
In accordance with the Company's Bylaws, the Board of Directors shall consist of no less than three and no more than seven directors, the specific number to be determined by resolution adopted by the Board of Directors. The Board of Directors has set the number of Directors at four, and four Directors are to be elected at the 2000 Annual Meeting of Shareholders.
Nominees for Director
The names and certain information concerning the persons to be nominated by the Board of Directors at the Annual Meeting are set forth below. THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF EACH OF THE NOMINEES NAMED BELOW. Shares represented by proxies will be voted for the election to the Board of Directors of the persons named below unless authority to vote for a particular director or directors has been withheld in the proxy. All nominees have consented to serve as directors for the ensuing year. The Board of Directors has no reason to believe that any of the nominees will be unable to serve as a director. In the event of the death or unavailability of any nominee or nominees, the proxy holders will have discretionary authority under the proxy to vote for a suitable substitute nominee as the Board of Directors may recommend. Proxies may not be voted for more than four (4) nominees. The Board of Directors has nominated the persons named in the following table to be elected as directors:
| Name |
Age |
Has Been a Director Since |
||
|---|---|---|---|---|
| Peter D. Behrendt | 61 | 1995 | ||
| Michael R. Hallman | 54 | 1992 | ||
| John V. Harker | 65 | 1992 | ||
| Nobuo Mii | 68 | 1997 |
Peter D. Behrendt is a director of the Company. He is the former Chairman and Chief Executive Officer of Exabyte Corp., a publicly traded company that is the world's largest independent manufacturer focused exclusively on tape storage products, tape libraries and recording media. Prior to working at Exabyte Corp., Mr. Behrendt spent 26 years in numerous executive positions at International Business Machines, Inc. ("IBM"), including worldwide responsibility for business and product planning for IBM's tape and disk drives and general management of IBM's worldwide electronic typewriter business. Mr. Behrendt holds a B.S. degree in Engineering from UCLA. Mr. Behrendt is on the Board of Directors of Western Digital Corp. and Exabyte Corp.
Michael R. Hallman is a director of the Company and is currently serving as President of The Hallman Group, a management consulting company focusing on marketing, sales, business development and strategic planning for the information systems industry. Mr. Hallman served as President and Chief Operating Officer of Microsoft Corporation from February 1990 until March 1992. From 1987 to 1990, he was Vice President of the Boeing Company and President of Boeing Computer Services. From 1967 to 1987, Mr. Hallman worked for IBM in various sales and marketing executive positions, with his final position being Vice President of Field Operations. Mr. Hallman holds a B.B.A. and a M.B.A. from the University of Michigan. Mr. Hallman is a member of the Board of Directors of Intuit, Inc. and Network Appliance, Inc.
John V. Harker is a director of the Company, and has served as President and Chief Executive Officer of the Company since April 1992. Mr. Harker was elected as Chairman of the Board in October 1994. Mr. Harker served as Executive Vice President and a member of the Board of Directors of Genicom Corporation, a manufacturer of printers, from 1984 to January 1992. Mr. Harker served as Senior Vice President of Marketing and Corporate Development of Data Products, Inc. from 1982 to 1984, as Vice President and partner of Booz, Allen & Hamilton, Inc. from 1979 to 1982, and in various managerial and
3
executive positions at IBM Corporation from 1963 to 1979. He holds a B.S. degree in Marketing from the University of Colorado.
Nobuo Mii is a director of the Company. Mr. Mii is the Managing Partner of Ignite Group. From December 1995 until 1998, Mr. Mii was also the CEO and Chairman of SegaSoft Networks, Inc. Mr. Mii is also a partner at ACCEL Partners, a venture capital firm specializing in technology investments. Mr. Mii also spent 26 years at IBM, with his final position being Corporate Vice President, General Manager of the Power Personal Systems Division. Mr. Mii holds a B.S. degree in Communication Engineering from Kyushu University in Fukuoka, Japan.
Meetings and Committees of the Board of Directors
The Board of Directors held seven meetings and took action pursuant to one unanimous written consent during the year ended December 31, 1999. No director, except for Mr. Mii, attended fewer than 75 percent of the meetings of the Board of Directors and committees thereof, if any, during the period that he was a member of the Board of Directors during 1999.
During 1999, the Audit Committee was composed of Messrs. Hallman (Committee Chair), Behrendt, Mii and Harker. After December 15, 1999, Mr. Harker was no longer a member of the audit committee. Messrs. Hallman, Behrendt and Mii are outside directors who are not, and have not been at any time in the past, officers of the Company. The Audit Committee reviews, with the Company's independent public accountants and representatives of management, the scope and results of audits, the appropriateness of accounting principles used in financial reporting, and the adequacy of financial and operating controls. The Audit Committee held three meetings in 1999.
The Compensation Committee and the Administrative Committee of both the 1988 Combination Stock Option Plan and the 1998 Stock Incentive Plan (the "Administrative Committee") were composed of Messrs. Hallman, Behrendt (Committee Chair for both committees) and Mii. The Compensation Committee approves all of the policies under which compensation is paid or awarded to the Company's executive officers. The Compensation Committee is responsible for establishing compensation of executive officers who also serve on the Board of Directors. The entire Board of Directors is responsible for reviewing and providing feedback on non-director executive officer compensation with goals and dollar amounts established by the Chief Executive Officer in accordance with policies approved by the Board. During 1999, the Administrative Committee was responsible for approving grants under the Company's stock plans. The Compensation Committee held one meeting during 1999 and the Administrative Committee held six meetings and took action pursuant to one unanimous written consent during 1999.
The Board of Directors does not have a Nominating Committee.
4
SELECTION OF INDEPENDENT ACCOUNTANTS
(Proposal No. 2)
The Board of Directors has appointed Arthur Andersen LLP, independent accountants, as auditors of the Company for the year ending December 31, 2000, subject to ratification by the shareholders. In the absence of contrary specifications, the shares represented by the proxies will be voted FOR the appointment of Arthur Andersen LLP as the Company's independent accountants for the year ending December 31, 2000.
A representative of Arthur Andersen LLP is expected to be present at the Annual Meeting. The representative will be given the opportunity to make a statement on behalf of his firm if such representative so desires, and will be available to respond to appropriate shareholder questions. Arthur Andersen LLP was the Company's independent accountant for the year ended December 31, 1999.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT ACCOUNTANTS OF THE COMPANY FOR THE YEAR ENDING DECEMBER 31, 2000.
5
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of February 29, 2000, certain information furnished to the Company with respect to ownership of the Company's Common Stock of (i) each Director, (ii) the "named executive officers" (as defined under "Executive Compensation"), (iii) all persons known by the Company to be beneficial owners of more than 5 percent of its Common Stock, and (iv) all current executive officers and Directors as a group.
| |
Common Stock (A) |
||||
|---|---|---|---|---|---|
| Shareholder |
Number of Shares |
Percent of Shares Outstanding |
|||
| Lord, Abbett & Co. (B) 90 Hudson Street Jersey City, NJ 07302 |
1,711,725 | 7.4 | % | ||
| John V. Harker (C) | 495,323 | 2.1 | % | ||
| Michael R. Hallman (D) | 139,793 | * | |||
| Susan L. Thompson (E) | 131,380 | * | |||
| Peter D. Behrendt (F) | 107,638 | * | |||
| Gary R. Pehrson (G) | 92,680 | * | |||
| William D. Yavorsky (H) | 77,166 | * | |||
| Nobuo Mii (I) | 57,492 | * | |||
| Mark A. Pruitt (J) | 23,384 | * | |||
| All executive officers and directors as a group (9 persons) (K) | 1,126,356 | 4.7 | % | ||
6
7
The following table identifies the current executive officers of the Company, the positions they hold and the year in which they began serving in their respective capacities. Officers of the Company are elected by the Board of Directors to hold office until their successors are elected and qualified.
| Name |
Age |
Current Position(s) with Company |
Position Held Since |
|||
|---|---|---|---|---|---|---|
| John V. Harker | 65 | Chairman of the Board, President and Chief Executive Officer | 1992 | |||
| E. Scott Hildebrandt | 44 | Vice President, Finance, Chief Financial Officer and Secretary | 1999 | |||
| Gary R. Pehrson | 54 | Senior Vice President, Worldwide Operations and Customer Service | 1998 | |||
| Mark A. Pruitt | 47 | Vice President, Research and Development | 1998 | |||
| Susan L. Thompson | 42 | Vice President, Corporate Resources | 1994 | |||
| William D. Yavorsky | 43 | Vice President, Worldwide Sales and Marketing | 1997 |
For information on the business background of Mr. Harker see "Nominees For Director" above.
E. Scott Hildebrandt joined the Company in July 1999 as Vice President, Finance, Chief Financial Officer and Secretary. From 1984 until joining the Company, Mr. Hildebrandt held various positions at Tektronix, Inc., with his latest position being Vice President and Treasurer. Prior to joining Tektronix, Inc., Mr. Hildebrandt was an Audit Manager at Deloitte and Touche LLP. Mr. Hildebrandt is a certified public accountant and holds a B.S. degree in Business Administration with an emphasis in Computer Science from Oregon State University.
Gary R. Pehrson joined the Company in January 1998 as Senior Vice President, Operations. From 1995 until joining the Company, Mr. Pehrson was Executive Vice President and General Manager for Teletronics Pacing Systems, a medical device manufacturer with annual sales over $300 million at the time. In 1997 Teletronics Pacing Systems was sold to St. Jude Medical and the name of the corporation was changed to Pacesetter, Inc.—A St. Jude Company. From 1990 to 1995, Mr. Pehrson was Senior Vice President at Verbatim Tape Corporation, a $500 million company at the time. Mr. Pehrson holds a B.S. degree in Business Administration with an emphasis in Marketing from the University of Nebraska, Lincoln.
Mark A. Pruitt joined the Company in July 1998 as Vice President, Engineering. From 1995 until joining the Company, Mr. Pruitt was the Sr. Director, Engineering for Western Digital Corporation. From 1977 to 1995, Mr. Pruitt held various positions with IBM Corporation, with his final position there being Product Manager, Tape/Peripheral Storage Products. Mr. Pruitt holds a B.S. degree in Electrical Engineering from Purdue University.
Susan L. Thompson joined the Company in May 1990 as Manager, Human Resources and in January 1994, was promoted to Vice President, Human Resources. In July 1998, Ms Thompson's title was changed to Vice President, Corporate Resources. From May 1989 to May 1990, Ms. Thompson was a training consultant with Richard Chang Associates, a large human resources consulting firm. From October 1987 to May 1989 Ms. Thompson held senior management positions in human resources at Emerald Systems, a computer peripherals manufacturer. Prior to this time, she held various positions within human resources at Archive Corporation and Fluor Engineers and Constructors. Ms. Thompson studied human resource management at the University of California at Irvine.
William D. Yavorsky was promoted to Vice President, Worldwide Sales in April 1997. Mr. Yavorsky joined the Company in August 1993 as Manager, Strategic Relationships. In January 1995, Mr. Yavorsky was promoted to Director, Strategic Relationships, International Sales and in July 1996 he was promoted to Director, Worldwide Sales. In October 1996, Mr. Yavorsky was promoted to Vice President, Sales. From February 1992 until joining the Company, Mr. Yavorsky was a Channel Sales Manager for Tektronix Corporation. Mr. Yavorsky holds a B.S. degree in Business Administration from Bowling Green State University.
8
Summary of Cash and Certain Other Compensation
The following table provides certain summary information concerning compensation awarded to, earned by or paid to the Company's Chief Executive Officer and each of the four other most highly compensated executive officers of the Company determined as of the end of the last fiscal year (herein referred to as the "named executive officers") for the fiscal years ended December 31, 1999, 1998 and 1997.
| |
|
Annual Compensation |
Long Term Compensation Awards |
|
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name and Principal Position |
Year |
Salary ($)(A) |
Bonus ($)(A) |
Other Annual Compensation ($)(B) |
Restricted Stock Awards ($)(D) |
Securities Underlying Options (#) |
All Other Compensation ($)(C) |
|||||||
| John V. Harker Chairman of the Board, President and Chief Executive Officer |
1999 1998 1997 |
418,470 381,933 345,971 |
1,064,058 7,625 230,888 |
— 1,050 1,450 |
97,815 144,706 — |
— 237,690 — |
9,954 4,574 3,978 |
|||||||
| Gary R. Pehrson (E) Senior Vice President, Worldwide Operations and Customer Support |
|
1999 1998 1997 |
|
251,077 242,308 21,231 |
|
205,069 206,324 — |
|
425 119,519 — |
|
71,971 7,141 — |
|
— 100,000 200,000 |
|
11,496 1,156 — |
| William D. Yavorsky Vice President, Worldwide Sales |
|
1999 1998 1997 |
|
209,231 197,692 145,757 |
|
188,729 5,795 48,585 |
|
— — — |
|
102,815 24,820 — |
|
— 82,560 — |
|
2,167 446 461 |
| Susan L. Thompson Vice President, Corporate Resources |
|
1999 1998 1997 |
|
209,231 197,692 155,962 |
|
150,808 5,795 53,789 |
|
— — — |
|
41,126 27,930 — |
|
80,000 49,720 — |
|
4,024 349 165 |
| Mark A. Pruitt (F) Vice President, Research and Development |
|
1999 1998 1997 |
|
209,231 99,231 — |
|
146,513 101,777 — |
|
— 64,351 — |
|
102,815 4,563 — |
|
— 130,000 — |
|
5,327 1,033 — |
9
| Name |
Shares held |
Value |
|||
|---|---|---|---|---|---|
| John V. Harker | 23,493 | $ | 544,802 | ||
| Gary R. Pehrson | 4,890 | 113,399 | |||
| William D. Yavorsky | 8,350 | 193,637 | |||
| Susan L. Thompson | 5,250 | 121,748 | |||
| Mark A. Pruitt | 6,000 | 139,140 | |||
Stock Options
The following table contains information concerning the grant of stock options under the Company's 1998 Stock Incentive Plan (the "Plan") to the named executive officers in 1999.
OPTION GRANTS IN LAST FISCAL YEAR
| Individual Grants (A) |
Potential Realizable Value At Assumed Annual Rates of Stock Price Appreciation for Option Term (B) |
||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name |
Number of Securities Underlying Options Granted |
% of Total Options Granted to Employees in Fiscal Year |
Exercise Price ($/Sh.) |
Expiration Date |
5% ($) |
10% ($) |
|||||||||
| John V. Harker | — | — | — | — | — | — | |||||||||
| Gary R. Pehrson | — | — | — | — | — | — | |||||||||
| William D. Yavorsky | — | — | — | — | — | — | |||||||||
| Susan L. Thompson | 80,000 | 15.5 | % | $ | 18.44 | 09/09/09 | $ | 927,645 | $ | 2,350,834 | |||||
| Mark A. Pruitt | — | — | — | — | — | — | |||||||||
10
overall stock market conditions. There can be no assurance that amounts reflected in this table will be achieved.
Option Exercises and Holdings
The following table provides information concerning the exercise of options during 1999 and unexercised options held as of the end of the fiscal year, with respect to the named executive officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
| Name |
Shares Acquired On Exercise (#) |
Value Realized ($) (A) |
Number of Securities Underlying Unexercised Options At FY-End (#) Exercisable/ Unexercisable |
Value of Unexercised In-The-Money Options At FY-End ($) (B) Exercisable/ Unexercisable |
||||||
|---|---|---|---|---|---|---|---|---|---|---|
| John V. Harker | 15,000 | $ | 126,067 | 337,338 / 205,352 | $ | 3,747,830 / $2,462,247 | ||||
| Gary R. Pehrson | 46,990 | 501,358 | 78,010 / 175,000 | 633,783 / 2,227,925 | ||||||
| William D. Yavorsky | 50,936 | 602,041 | 38,976 / 89,686 | 466,481 / 1,129,398 | ||||||
| Susan L. Thompson | 19,000 | 274,778 | 110,275 / 127,715 | 1,330,654 / 1,073,960 | ||||||
| Mark A. Pruitt | 27,116 | 394,905 | 5,384 / 97,500 | 89,848 / 1,676,288 | ||||||
11
Long-Term Incentive Plan Awards
The following table provides information concerning the grant of restricted stock pursuant to the 1998 Stock Incentive Plan during 1999 with respect to the named executive officers. Restricted stock grants are one vehicle to aid officers and directors in achieving certain ownership guidelines.
| Name |
Number Of Shares (#) (A) |
Period Until Maturation (B) |
||
|---|---|---|---|---|
| John V. Harker | 5,000 | 3 years | ||
| Gary R. Pehrson | 3,500 | 3 years | ||
| William D. Yavorsky | 5,000 | 3 years | ||
| Susan L. Thompson | 2,000 | 3 years | ||
| Mark A. Pruitt | 5,000 | 3 years |
During 1999, non-employee directors of the Company received an $18,000 annual retainer and $2,500 for each board meeting attended. The non-employee directors were also reimbursed for their expenses in attending meetings of the Company's Board of Directors. In addition, the Directors' Plan, as amended, provides that each "Eligible Director" shall be granted an option to purchase 20,000 shares of the Company's Common Stock upon becoming an Eligible Director and, so long as he remains an Eligible Director, he will be granted an option to purchase 10,000 shares of the Company's Common Stock on each date that he is re-elected to the Board at the Annual Shareholders' Meeting. Eligible Directors also received restricted stock grants based on a ratio of one share for every two shares of the Company's Common Stock purchased during 1999. The Company pays no additional remuneration to employees of the Company who serve as directors.
The following table summarizes option and restricted stock awards during 1999 for the Eligible Directors of the Company:
| Name |
# of Shares covered by Options |
Price of Options Granted |
# of Restricted Shares Granted |
Value of Restricted Shares Granted (A) |
||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Peter Behrendt | 10,000 | $ | 9.97 | -(B | ) | $ | — | |||
| Michael Hallman | 10,000 | 9.97 | 5,000 | 49,375 | ||||||
| Nobuo Mii | 10,000 | 9.97 | 5,000 | 72,500 | ||||||
12
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND
CHANGE-IN-CONTROL ARRANGEMENTS
In December 1999, the Board of Directors approved a severance plan providing for severance benefits in the event an officer's employment is terminated without "cause" or if the officer resigns for "good reason" within 18 months following a Change-in-Control. Under this plan, the Chief Executive Officer will receive two years' base salary and insurance benefits and all Vice Presidents and Senior Vice Presidents will receive one years' salary and insurance benefits. As a condition of receiving such severance benefits, the officer must sign a release of any legal claims against the Company and must abide by the Company's confidentiality agreement. In addition, he must sign a one-year non-compete agreement.
In April 1997, the Board of Directors approved amendments to the stock option agreements of all executive officers of the Company to provide that all options held by executive officers of the Company shall become immediately exercisable, without regard to any contingent vesting provision to which such option may otherwise be subject, in the event of the occurrence of a Change-in-Control. In addition, any unvested restricted stock will become fully vested immediately prior to a consummation of a reorganization resulting in a Change-in-Control.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors was composed of Messrs. Behrendt (Committee Chair), Hallman and Mii during 1999. All members of the Compensation Committee are non-employee, outside directors. Although Mr. Harker, the Company's Chief Executive Officer, served on the Company's Board of Directors in 1999 and participated in compensation discussions, he did not participate in any deliberations or decisions regarding his own compensation.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors was composed of Messrs. Behrendt (Committee Chair), Hallman and Mii during 1999. All members of the Compensation Committee are non-employee, outside directors. The Compensation Committee is responsible for establishing compensation of officers who also serve on the Board of Directors. The entire Board is responsible for reviewing and providing feedback on non-director executive officer compensation with goals and dollar amounts established by the Chief Executive Officer in accordance with policies approved by the Board. Awards to executive officers under the Company's stock option plans are made solely by the Administrative Committee, which is composed of the same non-employee, outside Directors as the Compensation Committee.
Compensation Philosophy and Policies
The Company's philosophy is to structure executive officer compensation so that it will attract, motivate and retain senior management by providing an opportunity for competitive compensation based on performance. Executive officer compensation includes competitive base salaries, annual bonus plans based on Company financial and personal performance goals, and long-term stock-based incentive opportunities in the form of options exercisable to purchase the Company's Common Stock and matching grants of restricted stock when an officer purchases and holds Common Stock of the Company. It is also the policy of both the Compensation Committee and the Administrative Committee that, to the extent possible, compensation will be structured so that it meets the "performance-based" criteria as defined by Section 162(m) of the Internal Revenue Code of 1986, as amended and therefore is not subject to federal income tax deduction limitations. Both the Compensation Committee and the Administrative Committee have the right to waive pre-established performance criteria in granting awards.
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Base Salaries
In setting base salaries that are competitive with other high technology companies, the Company participates in executive salary surveys including those conducted by Radford Associates, the American Electronics Association (AEA) and SC/CHIPS. When selecting comparables, the Company attempts to select companies that are similar in many respects, including industry, annual revenue and profitability. Executives' salaries paid in 1999 were targeted within the 50th to 75th percentile compared to the range of salaries paid by companies in the salary surveys mentioned above. Many of the companies included in the above mentioned surveys are also included in the indices used in the Performance Graph.
Annual Bonus Awards for 1999
The 1999 Officer Bonus Plan (the "Plan") provided for annual bonuses in two components. First, the Plan provided for quarterly profit sharing bonuses equal to a percentage of each officer's quarterly salary. This percentage was determined by dividing the quarterly non-officer profit sharing bonus pool (5 percent of pre-tax income) paid quarterly to non-officer employees by total non-officer compensation for the quarter. The percentages paid were approximately 4.7%, 7.2%, 9.2% and 12.8% in the first through fourth quarters of 1999, respectively. The fourth quarter profit sharing was paid in the first quarter of 2000.
Second, the Plan provided for the payment of executive officer bonuses (other than the Chief Executive Officer) based 75 percent on the Company meeting its 1999 profit before income tax objectives and 25 percent on meeting individual goals and objectives which are both quantitative and qualitative in nature, including such factors as market development, product introduction and resource management. The targeted bonus was 35 percent of annual salary for senior vice presidents and 30 percent of annual salary for all other vice presidents and would be achieved by an officer receiving 100 percent ratings on both the Company and individual goals. There was no maximum bonus component for Company profit before income tax performance and the maximum for individual performance was 130 percent. The Company goals had to be met at the 50 percent level or greater for an officer to receive any bonus under this portion of the Plan. In addition, the Vice President of Worldwide Sales was entitled to $1,000 for each $1.0 million of revenue generated over a specified target. Bonuses under this portion of the Plan totaled between 59.4 percent and 78.7 percent of officers' salaries for 1999.
Stock Option Awards for 1999
The Company's 1998 Stock Incentive Plan provides for the issuance of incentive and non-qualified stock options to officers and employees of the Company to purchase shares of the Company's Common Stock at an exercise price equal to the fair market value on the date of grant. See "Option Grants in Last Fiscal Year" table for a summary of options granted to the named executive officers during 1999.
Restricted Stock Awards
The Company's 1998 Stock Incentive Plan provides for the granting of restricted stock to officers, employees and consultants, including non-employee board members, of the Company. During 1999, the officers of the Company received restricted stock based on a ratio of one share for every two shares purchased between January 1, 1999 and December 31, 1999, up to a maximum of 5,000 shares per person for qualifying purchases made during any one calendar year. See "Long-Term Incentive Plans—Awards in Last Fiscal Year" table for a summary of restricted stock granted to the named executive officers during 1999.
Chief Executive Officer Compensation
Mr. Harker's 1999 base salary of $424,000 was determined in the same manner as the other executives as described in "Base Salaries" above. The profit sharing component of Mr. Harker's annual bonus was determined in the same manner as discussed above under "Annual Bonus Awards for 1999" and totaled
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$36,498. The second component of Mr. Harker's bonus was based on the Company meeting its profit before income tax objectives. Mr. Harker's targeted bonus under this component of the annual bonus plan was 60 percent of his 1999 annual salary, based on the Company meeting its profit before income tax objectives at the 100 percent level. There was no maximum on the bonus payout. Profit before tax had to be achieved at a minimum of 75 percent of target for Mr. Harker to receive a bonus under this component of the Plan. Mr. Harker's bonus under this portion of the Plan totaled $1,023,960, or 241.5 percent of his annual salary for 1999. The Compensation Committee's objective in setting Mr. Harker's 1999 compensation was to be competitive with other companies in the Company's industry and to allow for potential compensation based on long-term performance criteria as defined in "Annual Bonus Awards for 1999", "Stock Option Awards for 1999" and "Long-Term Incentive Plans—Awards in Last Fiscal Year" above.
SUBMITTED BY THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS:
Peter D. Behrendt (Committee Chair)
Michael R. Hallman
Nobuo Mii
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The SEC requires that registrants include in their proxy statement a line-graph presentation comparing cumulative five-year shareholder returns on an indexed basis, assuming a $100 initial investment and reinvestment of dividends, of (a) the registrant, (b) a broad-based equity market index and (c) an industry-specific index. The broad-based market index used is the Nasdaq Stock Market Total Return Index—U.S. and the industry-specific index used is the Computer Hardware Sector Sub-Index of the Chase H&Q Technology Index.
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| InFocus Systems, Inc. | $ | 100.00 | $ | 138.61 | $ | 82.97 | $ | 116.55 | $ | 68.11 | $ | 177.94 | ||||||
| Nasdaq U.S. Index | 100.00 | 141.33 | 173.89 | 213.07 | 300.25 | 542.43 | ||||||||||||
| Computer Sector Sub-Index of the Chase H&Q Technology Index | 100.00 | 143.96 | 190.85 | 259.82 | 499.20 | 914.05 | ||||||||||||
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the 1934 Act requires the Company's directors and executive officers and persons who own more than ten percent of the outstanding shares of the Company's Common Stock ("ten percent shareholders"), to file with the SEC initial reports of beneficial ownership and reports of changes in beneficial ownership of shares of Common Stock and other equity securities of the Company. To the Company's knowledge, based solely on review of the copies of such reports furnished to the Company or otherwise in its files and on written representations from its directors, executive officers and ten percent shareholders that no other reports were required, during the fiscal year ended December 31, 1999, the Company's officers, directors and ten percent shareholders complied with all applicable Section 16(a) filing requirements.
Proposals by shareholders intended to be included in the Company's Proxy Statement for its 2001 Annual Meeting must be received by the Company at its principal executive office no later than November 17, 2000. According to the Company's bylaws, proposals by shareholders intended to be presented at the Company's 2001 Annual Meeting must be received by the Company at its principal executive office no later than sixty calendar days (February 18, 2001) and no earlier than 90 calendar days (January 19, 2001) prior to the first anniversary of the preceding year's annual meeting.
As of the date of this Proxy Statement, the Board of Directors is not aware of any other matters that may come before this meeting. It is the intention of the persons named in the enclosed proxy to vote the proxy in accordance with their best judgment if any other matters do properly come before the meeting. Please return your proxy as soon as possible. Unless a quorum consisting of a majority of the outstanding shares entitled to vote is represented at the meeting, no business can be transacted. Therefore, please be sure to date and sign your proxy exactly as your name appears on your stock certificate and return it in the enclosed postage prepaid return envelope. Please act promptly to insure that you will be represented at this important meeting.
The Company will provide, without charge, on the written request of any beneficial owner of shares of the Company's Common Stock entitled to vote at the Annual Meeting of Shareholders, a copy of the Company's Annual Report on Form 10-K as filed with the U.S. Securities and Exchange Commission for the Company's fiscal year ended December 31, 1999. Written requests should be mailed to the Secretary, In Focus Systems, Inc., 27700B SW Parkway Avenue, Wilsonville, Oregon 97070.
By Order of the Board of Directors:
JOHN
V. HARKER
Chairman of the Board
Dated: March 17, 2000
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IN FOCUS SYSTEMS, INC.
Proxy for Annual Meeting of Shareholders to be Held on April 19, 2000
The undersigned hereby names, constitutes and appoints John V. Harker and E. Scott Hildebrandt, or either of them acting in absence of the other, with full power of substitution, my true and lawful attorneys and Proxies for me and in my place and stead to attend the Annual Meeting of the Shareholders of In Focus Systems, Inc. (the "Company") to be held at 1:00 p.m. on Wednesday, April 19, 2000, and at any adjournment thereof, and to vote all the shares of Common Stock held of record in the name of the undersigned on February 29, 2000, with all the powers that the undersigned would possess if he were personally present.
/*\ FOLD AND DETACH HERE /*\
| Please mark your votes as indicated in this example |
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| FOR all nominees below | WITHHOLD AUTHORITY to vote for all nominees listed below | FOR | AGAINST | ABSTAIN | ||||||||||||
| 1. | PROPOSAL 1 - Election of Directors | / / | / / | 2. | PROPOSAL 2 - To ratify the appointment of Arthur Andersen LLP as the Company's independent accountants for the year ending December 31, 2000. | / / | / / | / / | ||||||||
| To withhold authority to vote for any individual nominee, strike a line through the nominee's name in the list below: Peter D. Behrendt Michael R. Hallman John V. Harker Nobuo Mii |
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THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE APPROVAL OF PROPOSAL 2 |
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| THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR EACH OF THE NOMINEES NAMED ABOVE. |
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Upon such other matters as may properly come before, or incident to the conduct of the Annual Meeting, the Proxy holders shall vote in such manner as they determine to be in the best interests of the Company. Management is not presently aware of any such matters to be presented for action at the meeting. |
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THIS PROXY IS SOLICITED BY THE MANAGEMENT OF THE COMPANY. IF NO SPECIFIC DIRECTION IS GIVEN AS TO ANY OF THE ABOVE ITEMS, THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES NAMED IN PROPOSAL 1 AND FOR PROPOSAL 2. Please date, sign and return this proxy in the enclosed envelope. |
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| Signature(s) | Dated | , 2000 | ||||||
| NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. I do ( ) do not ( ) plan to attend the meeting. (Please check) |
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/*\ FOLD AND DETACH HERE /*\
The shareholder signed above reserves the right to revoke this Proxy at any time prior to its exercise by written notice delivered to the Company's Secretary at the Company's corporate offices at 27700B S.W. Parkway Avenue, Wilsonville, Oregon 97070, prior to the Annual Meeting. The power of the Proxy holders shall also be suspended if the shareholder signed above appears at the Annual Meeting and elects in writing to vote in person.
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