<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT [X] FILED BY A PARTY OTHER THAN THE REGISTRANT [ ]
- --------------------------------------------------------------------------------
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
COGNEX CORP.
(Name of Registrant as Specified In Its Charter)
COGNEX CORP.
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] 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:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
COGNEX CORPORATION
NOTICE OF SPECIAL MEETING IN LIEU OF
THE 2000 ANNUAL MEETING OF STOCKHOLDERS
MAY 8, 2000
To the Stockholders:
A Special Meeting of the Stockholders of COGNEX CORPORATION in lieu of the
2000 Annual Meeting will be held on Monday, May 8, 2000, at 10:00 a.m. at the
offices of Hutchins, Wheeler & Dittmar, A Professional Corporation, Suite 3100,
101 Federal Street, Boston, Massachusetts, for the following purposes:
1. To elect Robert J. Shillman to serve as a Director for a term of three
years as more fully described in the accompanying Proxy Statement.
2. To consider and act upon a proposal to amend the Articles of
Organization of the Corporation to increase the number of shares of
Common Stock which the Corporation has the authority to issue from
120,000,000 shares to 140,000,000 shares.
3. To consider and act upon any other business which may properly come
before the meeting.
The Board of Directors has fixed the close of business on March 16, 2000,
as the record date for the meeting. All stockholders of record on that date are
entitled to notice of and to vote at the meeting.
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING IN PERSON.
By order of the Board of Directors
ANTHONY J. MEDAGLIA, JR., Clerk
Natick, Massachusetts
March 31, 2000
<PAGE> 3
COGNEX CORPORATION
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Cognex Corporation (the "Corporation") for
use at the Special Meeting of Stockholders in Lieu of the 2000 Annual Meeting to
be held on Monday, May 8, 2000, at the time and place set forth in the notice of
the meeting, and at any adjournments thereof. The approximate date on which this
Proxy Statement and form of proxy are first being sent to stockholders is March
31, 2000.
If the enclosed proxy is properly executed and returned, it will be voted
in the manner directed by the stockholder. If no instructions are specified with
respect to any particular matter to be acted upon, proxies will be voted in
favor thereof. Any person giving the enclosed form of proxy has the power to
revoke it by voting in person at the meeting, or by giving written notice of
revocation to the Clerk of the Corporation at any time before the proxy is
exercised.
The holders of a majority in interest of all Common Stock issued,
outstanding and entitled to vote are required to be present in person or be
represented by proxy at the meeting in order to constitute a quorum for
transaction of business. The election of the nominee for Director will be
decided by plurality vote. The affirmative vote of the holders of at least a
majority of the shares of Common Stock outstanding is required to approve the
increase in the number of shares of Common Stock which the Corporation has the
authority to issue. Both abstentions and broker "non-votes" are counted as
present for the purposes of determining the existence of a quorum for the
transaction of business. However, for purposes of determining the number of
shares voting on a particular proposal, abstentions and broker "non-votes" are
not counted as votes cast or shares voting.
The Corporation will bear the cost of the solicitation. It is expected that
the solicitation will be made primarily by mail, but regular employees or
representatives of the Corporation (none of whom will receive any extra
compensation for their activities) may also solicit proxies by telephone,
telegraph and in person and arrange for brokerage houses and other custodians,
nominees and fiduciaries to send proxies and proxy materials to their principals
at the expense of the Corporation.
The Corporation's principal executive offices are located at One Vision
Drive, Natick, Massachusetts 01760, telephone number (508) 650-3000.
RECORD DATE AND VOTING SECURITIES
Only stockholders of record at the close of business on March 16, 2000, are
entitled to notice of and to vote at the meeting. On that date the Corporation
had outstanding and entitled to vote 42,798,705 shares of Common Stock, par
value $.002 per share. Each outstanding share of the Corporation's Common Stock
entitles the record holder to one vote.
ELECTION OF DIRECTORS
Pursuant to Massachusetts law, the Board of Directors is divided into three
classes, with each class as nearly equal in number as possible. One class is
elected each year for a term of three years. It is proposed that the nominee
listed below, whose term expires at this meeting, be elected to serve a term of
three years and until his successor is duly elected and qualified or until he
sooner dies, resigns or is removed. The Corporation presently has a Board of
Directors of five members.
<PAGE> 4
The persons named in the accompanying proxy will vote, unless authority is
withheld, for the election of the nominee named below. If such nominee should
become unavailable for election, which is not anticipated, the persons named in
the accompanying proxy will vote for such substitute as the Board of Directors
may recommend. The nominee is not related to any Executive Officer of the
Corporation or its subsidiaries.
<TABLE>
<CAPTION>
YEAR FIRST
ELECTED A POSITION WITH THE CORPORATION OR PRINCIPAL
NAME OF NOMINEE AGE DIRECTOR OCCUPATION DURING THE PAST FIVE YEARS
- --------------- --- ---------- ------------------------------------------
<S> <C> <C> <C>
NOMINATED FOR A TERM ENDING
IN 2003:
Robert J. Shillman................... 53 1981 Since 1981, President, Chief Executive Officer
and Chairman of the Board of the Corporation.
SERVING A TERM ENDING IN 2002:
Jerald Fishman....................... 54 1998 Since 1971, held various management positions
at, and since 1997, President and Chief
Executive Officer of Analog Devices. Mr.
Fishman also serves as a member of the Board of
Directors of Analog Devices and Kollmorgen
Corp.
William Krivsky...................... 70 1985 Since 1994, Principal of Kellogg, Krivsky &
Buttler, Inc. From 1986 to 1994, Executive Vice
President of Bird Corporation, a manufacturer
and distributor of building materials and
products and a provider of environmental
services. Previously, he had served as CEO of
Velcro Industries, N.V. Mr. Krivsky also serves
as a Director of Hitchiner Manufacturing.
SERVING A TERM ENDING IN 2001:
Anthony Sun.......................... 47 1982 Since 1979, general partner of Venrock
Associates, a venture capital partnership. Mr.
Sun also serves as a Director of Komag, Inc.,
Phoenix Technologies Ltd., 3Dfx Interactive,
Inc., and Worldtalk Communications Corp., and
several private companies.
Reuben Wasserman..................... 70 1990 Since 1985, an independent business consultant
serving corporations and venture capital firms,
and member of numerous Boards. Prior to 1985
was Vice President of Strategic Planning for
Gould, Inc. Also, a director of AMR, Inc., and
Business Advisor to Andover Controls Corp. and
Bizfon, Inc.
</TABLE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS
During fiscal 1999, there were five meetings of the Board of Directors of
the Corporation. All of the Directors attended at least 75% of the aggregate of
(i) the total number of meetings of the Board of Directors and (ii) the total
number of meetings held by committees of the Board of Directors on which they
served. The Board of Directors does not have a nominating committee. Each
non-employee Director received compensation in the amount of $7,000 for the
fiscal year plus an additional $1,500 for each meeting attended with the
exception of the last meeting held in December for which each member received
$1,750. Each non-employee
2
<PAGE> 5
Director who served on a committee of the Board of Directors in 1999 received an
annual fee of $2,000 per committee on which he served.
The Board of Directors has a Compensation/Stock Option Committee whose
members are Jerald Fishman and Anthony Sun, Chairman. The Compensation/Stock
Option Committee determines the compensation to be paid to key officers of the
Corporation and administers the Corporation's Stock Option Plans. The
Compensation/Stock Option Committee met on a total of four occasions in 1999.
The Corporation also has an Audit Committee whose present members are
Reuben Wasserman and William Krivsky, Chairman. The Audit Committee reviews with
the Corporation's independent auditors the scope of the audit for the year, the
results of the audit when completed and the independent auditor's fee for
services performed. The Audit Committee also recommends independent auditors to
the Board of Directors and reviews with management various matters related to
its internal accounting controls. During fiscal 1999 there were two meetings of
the Audit Committee.
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table shows as of February 25, 2000, any person who is known
by the Corporation to be the beneficial owner of more than five percent of any
class of voting securities of the Corporation. For purposes of this Proxy
Statement, beneficial ownership is defined in accordance with Rule 13d-3 under
the Securities Exchange Act of 1934 and means generally the power to vote or
dispose of the securities, regardless of any economic interest therein.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER OWNERSHIP OF CLASS
------------------------------------ ---------- --------
<S> <C> <C>
Robert J. Shillman.......................................... 6,293,324(1) 14.79%
Cognex Corporation
One Vision Drive
Natick, MA 01760
T. Rowe Price Associates, Inc............................... 4,969,525(2) 11.90%
100 E. Pratt Street
Baltimore, MD 21202
J & W Seligman & Co., Inc................................... 4,566,571(2) 11.02%
100 Park Avenue
New York, NY 10017
</TABLE>
- ---------------
(1) Includes 3,000,000 shares held by the Robert J. Shillman 1990 Irrevocable
Trust, 700 shares held by Mr. Shillman's wife, and 2,000 shares held by Mr.
Shillman's children. Mr. Shillman disclaims beneficial ownership of such
shares. Includes also 314,200 shares which Mr. Shillman has the right to
acquire upon the exercise of outstanding options exercisable currently or
within 60 days.
(2) According to Schedule 13G filed with the Securities and Exchange Commission
(the "Commission") reporting information as of December 31, 1999.
3
<PAGE> 6
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following information is furnished as of February 25, 2000, with
respect to Common Stock of the Corporation beneficially owned within the meaning
of Rule 13d-3 by all Directors of the Corporation and nominees, and by all
Directors and Executive Officers of the Corporation as a group. Unless otherwise
indicated, the individuals named held sole voting and investment power over the
shares listed below.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT
NAME OWNERSHIP OF CLASS
- ---- ---------- --------
<S> <C> <C>
Robert J. Shillman.......................................... 6,293,324(1)(2) 14.79%
Anthony Sun................................................. 218,288(1) *
Patrick Alias............................................... 56,329(1) *
Glenn Wienkoop.............................................. 38,000(1) *
William Krivsky............................................. 14,465 *
Reuben Wasserman............................................ 16,500(1) *
Jerald Fishman.............................................. 16,000(1) *
Richard Morin............................................... 8,500(1) *
All Directors and Executive Officers as a group (8
persons).................................................. 6,661,406(1)(3)
</TABLE>
- ---------------
* Less than 1%
(1) Includes the following shares which the specified individual has the right
to acquire upon the exercise of outstanding options, exercisable currently
or within 60 days: Mr. Shillman, 314,200 shares; Mr. Sun, 76,000 shares; Mr.
Alias, 52,400 shares; Mr. Wienkoop, 38,000 shares; Mr. Wasserman, 16,500;
Mr. Fishman, 16,000 shares; and Mr. Morin, 8,500 shares.
(2) See Footnote (1) under "Principal Holders of Voting Securities".
(3) Includes 521,600 shares which certain Directors and Executive Officers have
the right to acquire upon the exercise of outstanding options, exercisable
presently or within 60 days.
Notwithstanding anything to the contrary set forth in any of the
Corporation's previous filings under the Securities Act of 1933, as amended, or
the Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Proxy Statement, in whole or in part, the following
report and the Performance Graph on page 6 shall not be incorporated by
reference into any such filing.
COMPENSATION/STOCK OPTION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Corporation's executive compensation program is administered by the
Compensation/Stock Option Committee (the "Committee"), which determines
executive officer compensation annually. The Committee is composed of
independent directors who are not employees of the Corporation and its
determinations with respect to compensation for a fiscal year are made at the
beginning of the fiscal year.
In its deliberations, the Committee considers (i) the levels of
responsibility associated with each executive's position, (ii) the past
performance of the individual executive, (iii) the extent to which any
individual, departmental or Corporation-wide goals have been met, (iv) the
overall competitive environment and the level of compensation necessary to
attract and retain talented and motivated individuals in key positions, and (v)
the recommendations of appropriate officers of the Corporation.
The Corporation's compensation program utilizes a combination of base
salaries, annual bonuses and stock option awards.
4
<PAGE> 7
In determining the base salaries paid to the Corporation's executive
officers for the year ended December 31, 1999, the Committee considered, in
particular, their levels of responsibility, salary increases awarded in the
past, and the executive's experience and potential.
The Committee views annual bonuses as a vehicle for rewarding executives
for meeting performance objectives. The Committee establishes individual and
corporate performance targets each year. Executive officers are eligible to
receive annual cash bonuses upon achievement of such pre-determined performance
targets. The annual bonuses for the fiscal year ended December 31, 1999 reflect
the achievement of predetermined targets related to the Corporation's operating
income, other company metrics and individual goals.
The Corporation's stock option program is intended to reward the
participating executives for their efforts in building shareholder value and
improving corporate performance over the long term. The stock option program
also promotes the retention of talented executives. In determining the number of
options granted to executive officers, the Committee takes into consideration
options granted to such executives in previous years and the potential value
which may be realized upon exercise of the options as a result of appreciation
of the Corporation's stock during the option term.
In 1993 the Internal Revenue Code was amended to limit the deduction a
public company is permitted for compensation paid in 1994 and thereafter to the
chief executive officer and to the four most highly compensated executive
officers, other than the chief executive officer. Generally, amounts paid in
excess of $1 million to a covered executive, other than performance-based
compensation, cannot be deducted. In order to qualify as performance-based
compensation under the new tax law, certain requirements must be met, including
approval of the performance measures by the stockholders. The Committee intends
to consider ways to maximize deductibility of executive compensation, while
retaining the discretion the Committee considers appropriate to compensate
executive officers at levels commensurate with their responsibilities and
achievements.
COMPENSATION OF ROBERT J. SHILLMAN, PRESIDENT, CHIEF EXECUTIVE OFFICER AND
CHAIRMAN
The Committee established the compensation of Robert J. Shillman, the
President, Chief Executive Officer and Chairman of the Board of Directors of the
Corporation for the fiscal year ended December 31, 1999, using the same criteria
that were used to determine the compensation of other executive officers as
described above. In establishing the compensation of Robert J. Shillman, the
President, Chief Executive Officer and Chairman of the Board of Directors of the
Corporation for the fiscal year ended December 31, 1999, the Committee
considered his level of responsibility, salary increases awarded in the past,
and the significant role that Mr. Shillman has played in setting the strategic
direction of the Corporation. The Committee did not increase Mr. Shillman's base
compensation over that received in 1998; but Mr. Shillman's annual bonus of
$504,000, for the fiscal year ended December 31, 1999, was based upon the
achievement by the Corporation of pre-determined targets with respect to
operating income and is intended to reward Mr. Shillman for his role in the
achievement of that objective. Mr. Shillman was also granted options for the
purchase of 62,400 shares at $28.95 per share and 35,000 shares at $30.81 per
share. It should be noted that the Corporation's operating income for the year
ended December 31, 1999 increased 80% over operating income for the year ended
December 31, 1998.
The foregoing report has been approved by all members of the Committee.
COMPENSATION/STOCK OPTION
COMMITTEE
ANTHONY SUN, Chairman
JERALD FISHMAN
5
<PAGE> 8
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPH FOR COGNEX CORPORATION
[LINE GRAPH]
<TABLE>
<CAPTION>
NASDAQ COMPUTER AND DATA
NASDAQ STOCK MARKET (US PROCESSING STOCKS SIC
COGNEX CORPORATION COMPANIES) 7370-7379 US & FOREIGN
------------------ ----------------------- ------------------------
<S> <C> <C> <C>
12/1994 100.00 100.00 100.00
12/1995 269.90 141.30 152.30
12/1996 143.70 173.90 188.00
12/1997 211.70 213.10 230.90
12/1998 155.30 300.20 412.10
12/1999 302.90 545.70 888.20
</TABLE>
NOTES:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on the
previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a trading day,
the preceding trading day is used.
D. The index level for all series was set to $100.0 on 12/30/1994.
6
<PAGE> 9
COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION
Messrs. Fishman and Sun served as members of the Compensation/Stock Option
Committee during fiscal 1999. Mr. Sun served as President of Cognex Technology
and Investment Corporation, a subsidiary of the Corporation, during fiscal 1999.
EXECUTIVE COMPENSATION
The following table sets forth all compensation awarded to, earned by or
paid to the Corporation's Chief Executive Officer and each of the named
executive officers whose total annual salary and bonus exceeded $100,000 for all
services rendered in all capacities to the Corporation and its subsidiaries for
the Corporation's three fiscal years ended December 31, 1999.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION -------------
----------------------------- STOCK OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY(1) BONUS(1) (SHARES) COMPENSATION(2)
- --------------------------- ---- --------- -------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
Robert J. Shillman............... 1999 $301,142 $504,000 97,400 $ 1,151
President & CEO 1998 $300,404 $ 0 196,000 $ 1,391
1997 $197,977 $326,570 0 $ 1,440
Patrick Alias.................... 1999 $214,823 $247,250 15,200 $ 1,151
World Wide Sales & Marketing, 1998 $214,715 $ 0 162,000 $ 1,440
Executive Vice President 1997 $194,142 $184,700 0 $ 1,440
Richard Morin.................... 1999 $135,000 $ 81,400 102,000 $ 721
Chief Financial Officer
Glenn Wienkoop................... 1999 $277,869 $310,500 0 $ 1,151
MVSD Executive Vice President & 1998 $277,548 $ 0 294,800 $ 1,440
Chief Operating Officer 1997 $144,615 $ 38,614 290,000(4) $49,403(3)
</TABLE>
- ---------------
(1) Salary and bonus amounts are presented in the year earned. The payment of
such amounts may have occurred in other years.
(2) Amounts included are for insurance premiums paid by the Corporation for the
benefit of the named executive officer.
(3) Includes transition payments of $48,461 in accordance with an employment
agreement with the Company.
(4) Includes 260,000 options granted that were later revoked and terminated by
the Board of Directors.
7
<PAGE> 10
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information on option grants in fiscal 1999 to
the named executive officers. Pursuant to applicable regulations of the
Commission, the following table also sets forth the hypothetical value which
might be realized with respect to such options based on assumed rates of stock
appreciation of 5% and 10% compounded annually from date of grant to the end of
the option terms.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------
PERCENTAGE POTENTIAL REALIZABLE
OF TOTAL VALUE AT ASSUMED
NUMBER OF OPTIONS ANNUAL RATES OF STOCK
SECURITIES GRANTED TO EXERCISE PRICE APPRECIATION FOR
UNDERLYING EMPLOYEES OR BASE OPTION TERM(1)
OPTIONS IN FISCAL PRICE EXPIRATION -----------------------
NAME GRANTED 1999 (PER SHARE) DATE 5% 10%
- ---- ---------- ---------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Robert J. Shillman............... 62,400(2) 3.03% $28.95 4/27/09 1,136,304 2,879,136
President & CEO 35,000(3) 1.70% $30.81 12/14/14 1,163,400 3,426,150
Patrick Alias.................... 15,200(4) .74% $28.95 4/27/14 474,848 1,398,096
World Wide Sales & Marketing,
Executive Vice President
Richard Morin.................... 85,000(5) 4.13% $26.19 2/23/09 1,399,950 3,547,900
Chief Financial Officer 17,000(6) .83% $30.81 12/14/14 565,080 1,644,130
</TABLE>
- ---------------
(1) These values are based on assumed rates of appreciation only. Actual gains,
if any, on shares acquired on option exercises are dependent on the future
performance of the Corporation's Common Stock. There can be no assurance
that the values reflected in this table will be achieved.
(2) Options have a ten year term and vest at the rate of 33.33% per year over a
three year period commencing April 27, 2002.
(3) Options have a fifteen year term and vest 100% on April 27, 2004.
(4) Options have a fifteen year term and vest at the rate of 50% per year over a
two year period commencing April 27, 2003.
(5) Options have a ten year term and vest as follows: 10% year one, 15% year
two, and 25% for years three, four, and five commencing February 23, 2000.
(6) Options have a fifteen year term and vest 100% on April 27, 2005.
8
<PAGE> 11
AGGREGATED OPTION EXERCISES IN LAST
FISCAL YEAR AND 12/31/99 OPTION VALUES
The following table provides information on option exercises and on the
value of the named executive officers' unexercised options at December 31, 1999.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS AT 12/31/99 OPTIONS AT 12/31/99(1)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert J. Shillman........ 300,000 $7,094,490 179,200 454,200 $5,321,435 $10,859,155
President & CEO
Patrick Alias............. 184,000 $4,052,621 82,400 334,800 $2,575,200 $ 8,905,649
World Wide Sales &
Marketing, Executive
Vice President
Richard Morin............. 0 $ 0 0 102,000 $ 0 $ 1,228,199
Chief Financial Officer,
Glenn Wienkoop............ 76,000 $1,105,744 960 217,840 $ 22,080 $ 4,970,936
MVSD Executive Vice
President & Chief
Operating Officer
</TABLE>
- ---------------
(1) Value of unexercised stock options represents difference between the
exercise prices of the stock options and the closing price of the
Corporation's Common Stock on NASDAQ National Market System on December 31,
1999.
(2) Value realized on exercise represents difference between the exercise prices
of the stock options and the trading price of the Corporation's Common Stock
on NASDAQ National Market System on the date of exercise.
PROPOSED AMENDMENT INCREASING THE NUMBER OF SHARES OF
COMMON STOCK WHICH THE COMPANY HAS THE AUTHORITY
TO ISSUE FROM 120,000,000 SHARES TO 140,000,000 SHARES
On February 25, 2000, the Board of Directors adopted the following
resolution:
RESOLVED: That this Board of Directors deems it advisable that the
Articles of Organization of this corporation be amended so as to increase the
total number of shares of Common Stock which the corporation shall have
authority to issue from 120,000,000 shares, with a par value of $.002 per share,
to 140,000,000 million shares, with a par value of $.002 per share
The Board of Directors also directed that the proposed amendment be
submitted for action at the Special Meeting of Stockholders in lieu of the 2000
Annual Meeting to be held on May 8, 2000.
Increase in Number of Shares of Common Stock. If approved by the
stockholders, the amendment will authorize the Corporation to issue an
additional 20,000,000 shares of the corporation's Common Stock, par value $.002
per share. As of February 25, 2000, there were 120,000,000 shares of Common
Stock authorized, of which 42,542,247 shares were outstanding, 9,092,706 were
available for issuance pursuant to the corporation's stock option plans and
408,746 were available for issuance pursuant to the corporation's Employee Stock
Purchase Plan. The Board of Directors is empowered under the Articles of
Organization of
9
<PAGE> 12
the corporation to issue shares of authorized stock without further stockholder
approval. The holders of the corporation's Common Stock do not have preemptive
rights.
Appraisal Rights in Respect of the Proposed Amendment. Under the
applicable provisions of the Massachusetts Business Corporation Law, the
Corporation's stockholders have no appraisal rights with respect to the proposed
amendment.
Recommendations of the Board of Directors. As of February 25, 2000 there
were 44,925,353 shares of the corporation's Common Stock available for issuance
and not otherwise reserved. Accordingly, the Board of Directors believes that
the number of authorized shares of Common Stock should be increased by
20,000,000 shares to provide sufficient shares for use for such corporate
purposes as may be determined advisable by the Board of Directors, without
further action or authorization by the stockholders. Such corporate purposes
might include the acquisition of capital funds through the sale of stock, the
acquisition of other corporations or properties, or the declaration of stock
dividends in the nature of a stock split. There are no current plans,
agreements, arrangements or understandings with respect to the issuance of any
of the shares of Common Stock which would be authorized by the amendment;
however, the Board of Directors believes that the availability of shares would
afford the Corporation flexibility in considering and implementing any of the
corporate transactions enumerated above. Accordingly, the Board of Directors
recommends a vote for the proposed amendment.
10
<PAGE> 13
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed PricewaterhouseCoopers LLP as
independent auditors to examine the consolidated financial statements of the
Corporation and its subsidiaries for the fiscal year ended December 31, 2000.
A representative of PricewaterhouseCoopers LLP is expected to be present at
the meeting and will have the opportunity to make a statement if he or she so
desires and to respond to appropriate questions. The engagement of
PricewaterhouseCoopers LLP was approved by the Board of Directors at the
recommendation of the Audit Committee of the Board of Directors.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's officers and Directors and persons owning more than 10% of the
outstanding Common Stock of the Corporation to file reports of ownership and
changes in ownership with the Commission. Officers, Directors and greater than
10% holders of Common Stock are required by the Commission's regulation to
furnish the Corporation with copies of all Section 16(a) forms they file.
Based solely on copies of such forms furnished as provided above, the
Corporation believes that during the year ended December 31, 1999, all Section
16(a) filing requirements applicable to its Officers, Directors and owners of
greater than 10% of its Common Stock were complied with except that, through
inadvertence, two reports, each relating to two transactions by William Krivsky,
were reported late.
DEADLINES FOR SUBMISSION OF STOCKHOLDER PROPOSALS
Under regulations adopted by the Commission, any proposal submitted for
inclusion in the Corporation's Proxy Statement relating to the Annual Meeting of
Stockholders to be held in 2001 must be received at the Corporation's principal
executive offices in Natick, Massachusetts on or before December 1, 2000.
Receipt by the Corporation of any such proposal from a qualified stockholder in
a timely manner will not ensure its inclusion in the proxy material because
there are other requirements in the proxy rules for such inclusion.
In accordance with the provisions of Rule 14a-4(c) promulgated under the
Securities Exchange Act of 1934, if the Corporation does not receive notice of a
shareholder proposal to be raised at its 2001 Annual Meeting on or before
February 14, 2001, then in such event, the management proxies shall be allowed
to use their discretionary voting authority when the proposal is raised at the
2001 Annual Meeting.
In addition to the Commission requirements regarding stockholder proposals,
the Corporation's By-Laws contain provisions regarding matters to be brought
before stockholder meetings. If stockholder proposals, including proposals
regarding the election of Directors, are to be considered at the 2001 Annual
Meeting, notice of them whether or not they are included in the Corporation's
proxy statement and form of proxy, must be given by personal delivery or by
United States mail, postage prepaid, to the Clerk of the Corporation on or
before February 9, 2001.
OTHER MATTERS
Management knows of no matters which may properly be and are likely to be
brought before the meeting other than the matters discussed herein. However, if
any other matters properly come before the meeting, the persons named in the
enclosed proxy will vote in accordance with their best judgment.
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The cost of this solicitation will be borne by the Corporation. It is
expected that the solicitation will be made primarily by mail, but regular
employees or representatives of the Corporation (none of whom will receive any
extra compensation for their activities) may also solicit proxies by telephone,
telegraph and in person and arrange for brokerage houses and other custodians,
nominees and fiduciaries to send proxies and proxy material to their principals
at the expense of the Corporation.
10-K REPORT
THE CORPORATION WILL PROVIDE EACH BENEFICIAL OWNER OF ITS SECURITIES WITH A
COPY OF AN ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION FOR THE CORPORATION'S MOST RECENT FISCAL YEAR, WITHOUT CHARGE, UPON
RECEIPT OF A WRITTEN REQUEST FROM SUCH PERSON. SUCH REQUEST SHOULD BE SENT TO
MANAGER OF INVESTOR RELATIONS, COGNEX CORPORATION, ONE VISION DRIVE, NATICK,
MASSACHUSETTS 01760.
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VOTING PROXIES
The Board of Directors recommends an affirmative vote on all proposals
specified. Proxies will be voted as specified. If signed proxies are returned
without specifying an affirmative or negative vote on any proposal, the shares
represented by such proxies will be voted in favor of the Board of Directors'
recommendations.
By order of the Board of Directors
ANTHONY J. MEDAGLIA, JR., Clerk
Natick, Massachusetts
March 31, 2000
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SKU# 1012-PS-00
<PAGE> 17
COG10B DETACH HERE
PROXY
COGNEX CORPORATION
NOTICE OF SPECIAL MEETING IN LIEU OF
2000 ANNUAL MEETING OF STOCKHOLDERS
MAY 8, 2000
The undersigned hereby appoints Robert J. Shillman and Anthony J.
Medaglia, Jr., and each of them, with full power of substitution, proxies to
represent the undersigned at a Special Meeting in Lieu of the 2000 Annual
Meeting of Stockholders of COGNEX CORPORATION to held May 8, 2000 at 10:00 a.m.
at the offices of Hutchins, Wheeler & Dittmar, A Professional Corporation, 101
Federal Street, Suite 3100, Boston, Massachusetts, and at any adjournment or
adjournments thereof, to vote in the name and place of the undersigned, with
all powers which the undersigned would possess if personally present, all of
the shares of COGNEX CORPORATION standing in the name of the undersigned upon
such business as may properly come before the meeting, including the following
as set forth on the reverse side.
- ------------ -----------
SEE REVERSE CONTINUED AND BE TO SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
- ------------ -----------
<PAGE> 18
COG10A DETACH HERE
- --- PLEASE MARK
X VOTES AS IN
- --- THIS EXAMPLE.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. THE BOARD
RECOMMENDS AN AFFIRMATIVE VOTE ON ALL PROPOSALS SPECIFIED. SHARES WILL BE VOTED
AS SPECIFIED. IF NO SPECIFICATION IS MADE. THE SHARES REPRESENTED WILL BE VOTED
FOR THE ELECTION OF DIRECTOR AS SET FORTH IN THE PROXY STATEMENT AND FOR
PROPOSAL 2.
<TABLE>
<S> <C>
FOR AGAINST ABSTAIN
1. Election of Director for a term of three years. 2. To amend the Articles of Organization [ ] [ ] [ ]
of the Corporation to increase the
NOMINEE: Robert J. Shillman number of shares of Common Stock
which the Corporation has the
FOR WITHHELD authority to issue from 120,000,000
[ ] [ ] shares to 140,000,000 shares.
3. To consider and act upon any other business which may
property come before the meeting.
MARK HERE MARK HERE
FOR ADDRESS [ ] IF YOU PLAN [ ]
CHANGE AND TO ATTEND
NOTE AT LEFT THE MEETING
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY IN THE
ENVELOPE PROVIDED WHETHER OR NOT YOU INTEND TO BE PRESENT AT
THE MEETING IN PERSON.
Please sign exactly as your name(s) appear(s) on the Proxy.
When shares are held by joint tenants, both should sign.
When signing as attorney, executor, administrator, trustee
or guardian, please give full title as such. If a corporation,
please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership
name by authorized person.
Signature: ________________ Date: _____________________ Signature: __________________ Date: ______________________
</TABLE>
