<PAGE> 1
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:
[ ] 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))
IBIS TECHNOLOGY CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement if other than 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)(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
[IBIS LOGO]
- --------------------------------------------------------------------------------
Technology Corporation
March 31, 1997
Dear Stockholder,
You are cordially invited to attend the 1997 Annual Meeting of Stockholders
of Ibis Technology Corporation (the "Company") to be held at 12:00 noon on
Thursday, May 15, 1997 at the offices of the Company, 32 Cherry Hill Drive,
Danvers, Massachusetts 01923.
At the Annual Meeting, two persons will be elected to the Board of
Directors. The Company will also ask the stockholders to ratify the selection of
KPMG Peat Marwick LLP as the Company's independent public accountants. The Board
of Directors recommends the approval of each of these proposals. Such other
business will be transacted as may properly come before the Annual Meeting.
We hope you will be able to attend the Annual Meeting. Whether you plan to
attend the Annual Meeting or not, it is important that your shares are
represented. Therefore, you are urged promptly to complete, sign, date and
return the enclosed proxy card in accordance with the instructions set forth on
the card. This will ensure your proper representation at the Annual Meeting.
Sincerely,
/s/ Geoffrey Ryding
GEOFFREY RYDING
President and Chief Executive
Officer
YOUR VOTE IS IMPORTANT.
PLEASE RETURN YOUR PROXY PROMPTLY.
<PAGE> 3
IBIS TECHNOLOGY CORPORATION
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 15, 1997
To the Stockholders of Ibis Technology Corporation:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Ibis Technology
Corporation, a Massachusetts corporation (the "Company"), will be held on
Thursday, May 15, 1997 at the offices of the Company, 32 Cherry Hill Drive,
Danvers, Massachusetts 01923 at 12:00 noon for the following purposes:
1. To elect two members to the Board of Directors to serve for a term
ending in 2000 and until their successors are duly elected and
qualified.
2. To consider and act upon a proposal to ratify the appointment of KPMG
Peat Marwick LLP as the Company's independent public accountants for the
fiscal year ending December 31, 1997.
3. To transact such other business as may be properly brought before the
Annual Meeting and any adjournments thereof.
The Board of Directors has fixed the close of business on March 21, 1997 as
the record date for the determination of Stockholders entitled to notice of and
to vote at the Annual Meeting and at any adjournments thereof.
All Stockholders are cordially invited to attend the Annual Meeting.
Whether you plan to attend the Annual Meeting or not, you are requested to
complete, sign, date and return the enclosed proxy card as soon as possible in
accordance with the instructions on the proxy card. A pre-addressed, postage
prepaid return envelope is enclosed for your convenience.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Timothy J. Burns
TIMOTHY J. BURNS
Clerk
March 31, 1997
<PAGE> 4
IBIS TECHNOLOGY CORPORATION
32 CHERRY HILL DRIVE
DANVERS, MA 01923
508-777-4247
------------------------------------
PROXY STATEMENT
------------------------------------
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Ibis Technology Corporation (the "Company"), a
Massachusetts corporation, of proxies, in the accompanying form, to be used at
the Annual Meeting of Stockholders to be held at the offices of the Company, 32
Cherry Hill Drive, Danvers, Massachusetts 01923 on Thursday, May 15, 1997 at
12:00 noon, and any adjournments thereof (the "Meeting").
Where the Stockholder specifies a choice on the proxy as to how his or her
shares are to be voted on a particular matter, the shares will be voted
accordingly. If no choice is specified, the shares will be voted FOR the
election of the two nominees for director named herein, and FOR the ratification
of the appointment of KPMG Peat Marwick LLP as the Company's independent public
accountants for the fiscal year ending December 31, 1997. Any proxy given
pursuant to this solicitation may be revoked by the person giving it at any time
before its use by delivering to the Company a written notice of revocation or a
duly executed proxy bearing a later date. Any Stockholder who has executed a
proxy but is present at the Meeting, and who wishes to vote in person, may do so
by revoking his or her proxy as described in the preceding sentence. Shares
represented by valid proxies in the form enclosed, received in time for use at
the Meeting and not revoked at or prior to the Meeting, will be voted at the
Meeting. The presence, in person or by proxy, of the holders of a majority of
the outstanding shares of the Company's common stock, par value $.008 per share
("Common Stock"), is necessary to constitute a quorum at the Meeting.
With respect to all matters to be acted on at the Meeting, other than the
election of Directors which requires a plurality of the shares voted
affirmatively or negatively at the Meeting, the affirmative vote of a majority
of the total number of shares voted either for or against each proposal at the
Meeting is required to approve the proposal, with abstentions and non-votes
having no effect on the vote.
The close of business on March 21, 1997 has been fixed as the record date
for determining the Stockholders entitled to notice of and to vote at the
Meeting. As of the close of business on March 21, 1997, the Company had
5,197,278 shares of Common Stock outstanding and entitled to vote. Holders of
Common Stock are entitled to one vote per share on all matters to be voted on by
Stockholders.
The cost of soliciting proxies, including expenses in connection with
preparing and mailing this Proxy Statement, will be borne by the Company. In
addition, the Company will reimburse brokerage firms and other persons
representing beneficial owners of Common Stock of the Company for their expenses
in forwarding proxy material to such beneficial owners. Solicitation of proxies
by mail may be supplemented by telephone, telegram, telex and personal
solicitation by the directors, officers or employees of the Company. No
additional compensation will be paid for such solicitation.
This Proxy Statement and the accompanying proxy are being mailed on or
about March 31, 1997 to all Stockholders entitled to notice of and to vote at
the Meeting.
The Annual Report to Stockholders for the fiscal year ended December 31,
1996 is being mailed to the Stockholders with this Proxy Statement, but does not
constitute a part hereof.
<PAGE> 5
SHARE OWNERSHIP
The following table sets forth certain information as of March 3, 1997
concerning the ownership of Common Stock by (i) each Stockholder known by the
Company to be the beneficial owner of more than 5% of its outstanding shares of
Common Stock, (ii) each current member of the Board of Directors, (iii) each
executive officer named in the Summary Compensation Table on p. 7 hereof, and
(iv) all current directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY OWNED(1)
-----------------------
NAME AND ADDRESS** NUMBER PERCENT
- ------------------ ------- -------
<S> <C> <C>
Wheatley Partners L.P.(2)............................................. 360,000 6.92%
80 Cutterhill Road, Suite 311
Great Neck, New York 11021
Geoffrey Ryding, Ph.D.(3)............................................. 107,717 2.07%
Timothy J. Burns(4)................................................... 48,333 *
Ted R. Dintersmith, Ph.D.(5).......................................... 42,473
Theodore H. Smick(6).................................................. 24,332 *
Peter H. Rose, Ph.D.(7)............................................... 19,976 *
Richard Hodgson(8).................................................... 19,976 *
Dimitri Antoniadis.................................................... -- *
Donald McGuinness..................................................... -- *
Executive Officers and Directors as a group
(11 Persons)(3),(4),(5),(6),(7),(8),(9)............................. 339,615 6.35%
</TABLE>
- ---------------
* Represents beneficial ownership of less than 1% of the outstanding Common
Stock.
** Addresses are given for beneficial owners of more than 5% of the outstanding
Common Stock only.
(1) The number of shares of Common Stock issued and outstanding on March 3, 1997
was 5,197,278. The calculation of percentage ownership for each listed
beneficial owner is based upon the number of shares of Common Stock issued
and outstanding at March 3, 1997, plus shares of Common Stock subject to
options held by such person or group at March 3, 1997 and exercisable within
60 days thereafter, plus shares of common Stock subject to Redeemable
Warrants held by such person or group at March 3, 1997 and exercisable
within 60 days thereafter. The Company believes that all the persons and
entities named in the Table have the sole voting and investment power with
respect to all the shares as beneficially owned by them, except as noted
below.
(2) This information, except the percentage beneficially owned, is as of
December 3, 1996 and is based solely on (i) a Schedule 13D (the "Schedule
13D") filed on November 7, 1996 with the Securities and Exchange Commission
by Wheatley Partners, L. P. ("Wheatley"), and (ii) Amendment No. 1 to the
Schedule 13D filed on December 24, 1996 with the Securities and Exchange
Commission by Wheatley. Consists of 338,649 shares held by Wheatley and
21,351 shares held by Wheatley Foreign Partners, L. P. ("Wheatley Foreign").
Wheatley has sole voting and dispositive power of the 338,649 shares held of
record by Wheatley and may be deemed to share voting and dispositive power
of the 21,351 shares held by Wheatley Foreign. Wheatley disclaims beneficial
ownership of the 21,351 shares held by Wheatley Foreign. Wheatley Foreign
has sole voting and dispositive power of the 21,351 shares held of record by
Wheatley Foreign and may be deemed to share voting and dispositive power of
the 338,649 shares held by Wheatley. Wheatley Foreign disclaims beneficial
ownership of the 338,649 shares held by Wheatley. Wheatley Partners LLC
("Wheatley LLC") is the general partner of Wheatley and a general partner of
Wheatley Foreign and as such may be deemed to share voting and dispositive
power of the aggregate of
2
<PAGE> 6
360,000 shares held of record by Wheatley and Wheatley Foreign. Wheatley
Management Ltd. ("Wheatley Management") is a general partner of Wheatley
Foreign and as such may be deemed to share voting and dispositive power of
the aggregate of 360,000 shares held of record by Wheatley and Wheatley
Foreign. Barry Rubenstein, Irwin Lieber, Barry Fingerhut, Seth Lieber,
Jonathan Lieber, and Matthew A. Smith are each members and officers of
Wheatley LLC and as such may be deemed to share voting and dispositive power
of the aggregate of 360,000 shares held of record by Wheatley and Wheatley
foreign. Each of Messrs. Rubenstein, I. Lieber, Fingerhut, S. Lieber, J.
Lieber and Smith, and each of Wheatley LLC and Wheatley Management,
disclaims beneficial ownership of the shares except to the extent of his/its
equity ownership in the relevant entity.
(3) Includes 6,000 shares held by certain family members and 8,333 shares of
Common Stock that may be acquired upon the exercise of options within 60
days of March 3, 1997.
(4) Consists of 48,333 shares of Common Stock that may be acquired upon the
exercise of options within 60 days of March 3, 1997.
(5) Includes 2,500 shares of Common Stock that may be acquired upon the exercise
of currently exercisable options held directly by Dr. Dintersmith. Also,
includes 8,796 shares held by Aegis II Limited partnership ("Aegis II"),
4,235 shares issuable upon the exercise of Redeemable Warrants held by Aegis
II, 8,794 shares held by Aegis Select Limited Partnership ("Aegis Select")
and 4,235 shares issuable upon the exercise of Redeemable Warrants held by
Aegis Select. Dr. Dintersmith, a Director of the Company, disclaims
beneficial ownership of the shares and Redeemable Warrants held by Aegis II
and Aegis Select.
(6) Includes 8,333 shares of Common Stock that may be acquired upon the exercise
of options within 60 days of March 3, 1997.
(7) Consists of 19,976 shares of Common Stock that may be acquired upon the
exercise of options within 60 days of March 3, 1997.
(8) Includes 6,870 shares of Common Stock that may be acquired upon the exercise
of options within 60 days of March 3, 1997.
(9) Includes 30,059 shares held directly or by certain family members of other
executive officers of the Company and 46,749 shares of Common Stock that may
be acquired upon the exercise of options within 60 days of March 3, 1997
held by such executive officers.
3
<PAGE> 7
MANAGEMENT
DIRECTORS
The Company's Restated Articles of Organization and Restated By-Laws
provide for the Company's business to be managed by or under the direction of
the Board of Directors. Under the Company's Restated Articles of Organization
and Restated By-Laws, the number of directors is fixed from time to time by the
Board of Directors. The Board of Directors currently consists of six members,
classified into three classes as follows: Richard Hodgson and Geoffrey Ryding
constitute a class with a term which expires at the upcoming Meeting (the "Class
III directors"); Ted R. Dintersmith and Dimitri Antoniadis constitute a class
with a term ending in 1998 (the "Class I directors"); and Peter H. Rose and
Donald F. McGuinness constitute a class with a term ending in 1999 (the "Class
II directors"). Dr. Dintersmith has resigned effective as of the Meeting.
Pursuant to the Company's Restated By-Laws, the vacancy created by Dr.
Dintersmith's resignation may be filled by a majority vote of the remaining
Directors. At each annual meeting of Stockholders, directors are elected for a
full term of three years to succeed those directors whose terms are expiring.
Pursuant to the Company's Restated Articles of Organization and Restated
By-Laws, the Board of Directors on January 30, 1997 voted (i) to set the size of
the Board of Directors at six and (ii) to nominate Richard Hodgson and Geoffrey
Ryding for election at the Meeting for a term of three years to serve until the
2000 annual meeting of Stockholders, and until their respective successors have
been elected and qualified. Dimitri Antoniadis (a Class I director), and Donald
F. McGuinness and Peter H. Rose (the Class II directors) will serve until the
annual meetings of Stockholders to be held in 1998 and 1999, respectively, and
until their respective successors have been elected and qualified. Ted R.
Dintersmith (a Class I director) will serve until the Meeting.
The names of the Company's current directors and certain information about
them are set forth below:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Richard Hodgson...................... 80 Chairman of the Board of Directors
Geoffrey Ryding, Ph.D................ 55 Chief Executive Officer, President and Director
Dimitri Antoniadis(1)................ 50 Director
Donald F. McGuinness(1).............. 64 Director
Peter H. Rose, Ph.D.(2).............. 72 Director
</TABLE>
- ---------------
(1) Member of the Audit Committee
(2) Member of the Compensation Committee
The following is a brief summary of the background of each director of the
Company:
Richard Hodgson was elected as Chairman of the Board of Ibis in December
1993 and has served as a director of the Company since May 1992. Since 1980, Mr.
Hodgson has been a director of McCowan Associates, an investment management
company located in New York City. Mr. Hodgson was a founder of Intel
Corporation, where he continues to serve on the Board of Directors. He is also a
director of I-Stat Corporation, Accent Color Sciences and several privately-held
high-technology companies.
Geoffrey Ryding, Ph.D. joined Ibis in May 1992 as President and Chief
Operating Officer and as a director. In December 1993, he was elected as Chief
Executive Officer of the Company. From 1987 to 1992, Dr. Ryding worked in the
Semiconductor Equipment Division at Eaton Corporation where, from 1987 to 1991,
he was Vice President and Director of Marketing, Sales and Service, responsible
for worldwide marketing, sales and service of all products, including a staff of
250 people operating from 39 offices in 18 countries and, from 1991 to 1992, he
was Technical Director. Also from 1991 to 1992, Dr. Ryding, with Dr.
4
<PAGE> 8
Rose, provided consulting services to a major Japanese semiconductor equipment
manufacturer in connection with developing ion beam lithography technology.
Peter H. Rose, Ph.D. has served as director of the Company since 1988. In
July 1993, Dr. Rose founded and became President of Krytek Corporation, a
manufacturer of aerosol cleaning equipment for the semiconductor industry. From
1991 to 1992, Dr. Rose, with Dr. Ryding, provided consulting services to a major
Japanese semiconductor equipment manufacturer in connection with developing ion
beam lithography technology. He is a Director of Lumonics, Inc., a Canadian
Corporation.
Donald F. McGuinness was appointed to the Board of Directors in 1996. He
has been the Chairman, President and Chief Executive Officer of Electronic
Designs, Inc., a publicly held company, since 1988. He is also a Director of
Cabletron Systems, Inc.
Dimitri Antoniadis, Ph.D. was appointed to the Board of Directors in 1996.
He is a Professor of Electrical Engineering at Massachusetts Institute of
Technology (MIT) and been a member of the faculty since 1978. He is also a
Director of the SRC Center of Excellence for Microsystems Technologies at MIT.
COMMITTEES OF THE BOARD OF DIRECTORS AND MEETINGS
Meeting Attendance. During the fiscal year ended December 31, 1996, there
were four meetings of the Board of Directors. No director attended fewer than
75% of the total number of meetings of the Board and of committees of the Board
on which he served during fiscal 1996, except that Peter Rose attended 50% of
the meetings of the Board that were held.
Audit Committee. The Audit Committee, which met once during fiscal 1996,
has two members, Dimitri Antoniadis and Donald F. McGuinness. The Audit
Committee reviews the engagement of the Company's independent accountants,
reviews annual financial statements, considers matters relating to accounting
policy and internal controls and reviews the scope of annual audits.
Compensation Committee. The Compensation Committee, which met four times
during fiscal 1996, has two members, Ted R. Dintersmith and Peter H. Rose. The
Compensation Committee reviews, approves and makes recommendations on the
Company's compensation policies, practices and procedures to ensure that legal
and fiduciary responsibilities of the Board of Directors are carried out and
that such policies, practices and procedures contribute to the success of the
Company; and further, administers stock and employee benefit plans, including
the Company's 1988 Stock Option Plan and the 1993 Employee, Director and
Consultant Stock Option Plan (the "1993 Plan"). Upon the effectiveness of Dr.
Dintersmith's resignation, the Board of Directors intends to appoint another
non-employee director to the Compensation Committee.
Nominating Committee. The Company does not have a standing Nominating
Committee.
Compensation Committee Interlocks and Insider Participation. The
Compensation Committee has two members, Ted R. Dintersmith and Peter H. Rose.
Upon the effectiveness of Dr. Dintersmith's resignation, the Board of Directors
intends to appoint another non-employee director to the Compensation Committee.
COMPENSATION OF DIRECTORS
Pursuant to the Company's 1993 Plan, each non-employee director of the
Company then serving as a director is granted non-qualified stock options to
purchase 1,250 shares of Common Stock following each annual meeting of
stockholders of the Company, and any new non-employee directors will be granted
non-qualified stock options to purchase 1,250 shares of Common Stock upon
election to the Board. These options vest in full immediately prior to the
annual meeting following the date the options are granted and have an exercise
price equal to the fair market value of the Common Stock on the date of grant.
As of December 31,
5
<PAGE> 9
1996, pursuant to the 1993 Plan each of the Company's current directors, except
Dr. Ryding, Dr. Antoniadis and Mr. McGuinness, had been granted non-qualified
stock options to purchase an aggregate of 3,750 shares of Common Stock having a
weighted average exercise price of $6.72 per share. Dr. Antoniadis and Mr.
McGuinness were each granted options to purchase 8,750 shares at an exercise
price of $6.50 per share upon their election to the Board of Directors in July
1996, which included the options to acquire 1,250 shares of common stock granted
to all new non-employee directors under the 1993 Plan. Options to acquire 1,250
shares vest in full immediately prior to the Meeting and the options to acquire
the remaining 7,500 shares vest in three equal annual installments of 2,500
shares commencing in July 1997 for Dr. Antoniadis and Mr. McGuinness.
The Company pays to each non-employee director (Mr. Hodgson, Dr. Rose, Dr.
Antoniadis and Mr. McGuinness) $1,000 for each meeting of the Board of Directors
and committees of the Board that each of them attends and reimburses each of
them for their expenses incurred in attending such meetings. In 1996, the
aggregate amount of compensation and reimbursement for such expenses paid to all
of these directors was approximately $11,608.
The Company has agreed that until May 1999, Josephthal Lyon & Ross
Incorporated ("Josephthal") shall have the right to designate one person,
reasonably acceptable to the Company, for election to the Company's Board of
Directors, and the Company will use its best efforts to cause the election of
such person as a director of the Company. Such individual may be a director,
officer, employee or affiliate of Josephthal. In the event Josephthal elects not
to exercise this right to designate a person for election to the Company's Board
of Directors, Josephthal may designate a person to attend meetings of the Board
of Directors. To date, Josephthal has elected not to designate a person for
election to the Board.
Certain members of the Company's Board of Directors are parties to
transactions with the Company. See "Certain Transactions."
EXECUTIVE OFFICERS
The names of, and certain information regarding, executive officers of the
Company who are not also directors, are set forth below. Except for an executive
officer who has an employment agreement with the Company, the executive officers
serve at the pleasure of the Board of Directors.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- ---- -------
<S> <C> <C>
Timothy J. Burns, C.P.A............ 57 Chief Financial Officer, Operations
Manager, Treasurer and Clerk
Angelo V. Alioto................... 50 Vice President of Sales and Marketing
Bernhard F. Cordts III, Ph.D....... 45 Vice President of Wafer Technology
Robert P. Dolan.................... 37 Vice President of Wafer Manufacturing
Theodore H. Smick.................. 43 Vice President of Equipment Technology
</TABLE>
Timothy J. Burns joined Ibis in 1994 as Chief Financial Officer. He also
became Operations Manager in January 1996 and Treasurer and Clerk in October
1996. From 1987 to 1994, Mr. Burns was a shareholder of Argus Management
Corporation, a nationally known turnaround and interim management firm.
Angelo V. Alioto joined the Company in 1990 as a Regional Sales Manager,
became Worldwide Sales Manager in 1991 and was elected as Vice President of
Sales in December 1993 and Vice President of Marketing in January 1996.
Bernhard F. Cordts, III, Ph.D. joined the Company in 1988 as Process
Development Manager. In January 1997, he was appointed Vice President of Wafer
Technology.
6
<PAGE> 10
Robert P. Dolan, joined the Company in 1988 as Production Manager. In
January 1997, he was appointed Vice President of Wafer Manufacturing.
Theodore H. Smick joined the Company in May 1990 as Director of Equipment
Development. In December 1993 he was elected as Vice President of Equipment
Technology.
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid to or earned by the
following individuals for services rendered to the Company in all capacities
during the Company's last three fiscal years: (i) the Chief Executive Officer of
the Company (the "CEO") as of December 31, 1996, and (ii) each of the most
highly compensated executive officers of the Company (other than the CEO) as of
December 31, 1996 whose salary and bonus earned during fiscal 1996 exceeded
$100,000 (the CEO and those officers are referred to herein collectively as the
"Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
---------------------- ------------
AWARDS
------------
SECURITIES
NAME AND FISCAL UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS(#) COMPENSATION($)(2)
------------------ ------ --------- -------- ------------ ------------------
<S> <C> <C> <C> <C> <C>
Geoffrey Ryding.............................. 1996 $140,000 $18,000 15,000 $288
President and Chief Executive Officer 1995 $130,000 $47,148 10,000 $228
1994 $130,000 $20,000 -- $228
Timothy J. Burns(1).......................... 1996 $120,000 $12,000 15,000 $450
Chief Financial Officer, Operations
Manager, 1995 $120,000 $36,987 10,000 $450
Treasurer and Clerk 1994 $ 62,938 -- 60,000 $225
Theodore H. Smick............................ 1996 $103,000 -- 15,000 $102
Vice President of Equipment Technology 1995 $103,000 $ 5,819 22,000 $102
1994 $ 98,000 -- -- $ 98
</TABLE>
- ---------------
(1) Mr. Burns joined the Company as Chief Financial Officer in June 1994.
(2) All Other Compensation consists of the dollar value of premiums paid by the
Company with respect to term life insurance for the benefit of each Named
Executive Officer in the amount of $100,000.
7
<PAGE> 11
OPTION GRANTS
The following table sets forth certain information regarding each stock
option granted to a Named Executive Officer during fiscal 1996.
OPTION GRANTS DURING YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
POTENTIAL
INDIVIDUAL GRANTS REALIZABLE
--------------------------------------------- VALUE AT ASSUMED
% OF ANNUAL RATES OF
NUMBER OF TOTAL STOCK PRICE
SECURITIES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM(3)
OPTIONS EMPLOYEES IN PRICE EXPIRATION -------------------
NAME GRANTED(#)(1) FISCAL YEAR ($/SHARE)(2) DATE 5%($) 10%($)
---- ------------- ------------ ------------ ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Geoffrey Ryding......... 15,000 5.17% $ 6.88 4/17/06 $64,950 $164,550
Timothy J. Burns........ 15,000 5.17% $ 6.88 4/17/06 $64,950 $164,550
Theodore H. Smick....... 15,000 5.17% $ 6.88 4/17/06 $64,950 $164,550
</TABLE>
- ---------------
(1) The options were granted pursuant to the 1993 Plan. The options granted to
the Named Executive Officers are incentive stock options which vest annually
in three equal installments commencing one year from the date of grant.
Options terminate ten years after the grant date, subject to earlier
termination in accordance with the 1993 Plan and the applicable option
agreement. In the event of a change in control of the Company (as defined in
the 1993 Plan), all outstanding unvested options, including options held by
Dr. Ryding and Messrs. Burns and Smick, will become immediately vested,
unless provision is made for the continuation of such options pursuant to
the applicable provisions of the 1993 Plan.
(2) Under the terms of the 1993 Plan, the exercise price of all stock options
may be no less than (a) the average of the closing prices of the Common
Stock for the ten consecutive trading days immediately preceding the grant
date or (b) the closing price of the Common Stock for the trading day
immediately preceding the grant date.
(3) Amounts represent hypothetical gains that could be achieved for the options
if exercised at the end of the option term. Those gains are based on assumed
rates of stock price appreciation of 5% and 10% compounded annually from the
date the respective options were granted to their expiration dates. Actual
gains, if any, on stock options, exercises and Common Stock holdings are
dependent on future performance of the Common Stock.
8
<PAGE> 12
OPTION EXERCISES AND FISCAL YEAR-END VALUES
The following table provides information regarding the exercises of options
by each of the Named Executive Officers during fiscal 1996. In addition, the
table includes the number of shares covered by both exercisable and
unexercisable stock options as of December 31, 1996 and the values of
"in-the-money" options as of that date. An option is "in-the-money" if the per
share fair market value of the underlying stock exceeds the option exercise
price per share.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF THE UNEXERCISED
SHARES UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
ACQUIRED AT FISCAL YEAR-END AT FISCAL YEAR-END($)(1)
ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Geoffrey Ryding............. 20,172 212,714 3,333 21,667 $ 133 $ 2,067
Timothy J. Burns............ -- -- 43,333 41,667 $ 133 $ 2,067
Theodore H. Smick........... 5,551 32,964 3,333 29,667 $ 133 $35,427
</TABLE>
- ---------------
(1) The value of unexercised in-the-money options at December 31, 1996 is based
on the difference between the fair market value for the Company's Common
Stock of $7.00 (the closing sale price per share of the Company's Common
Stock as reported on the Nasdaq National Market on December 31, 1996) and
the per share option exercise price, multiplied by the number of shares of
Common Stock underlying such options.
EMPLOYMENT AGREEMENT AND CHANGE OF CONTROL ARRANGEMENTS
The Company has an employment agreement with Dr. Geoffrey Ryding which
provides for Dr. Ryding to serve as President and Chief Executive Officer of the
Company until May 1997 at an annual base salary of $140,000. The Company and Dr.
Ryding are currently in discussions concerning extending this Agreement. It is
also intended that Dr. Ryding will be paid an annual bonus of 40% of his annual
base salary if his performance and the Company's performance satisfy certain
predetermined goals mutually agreed upon by Dr. Ryding and the Board of
Directors. In the event that Dr. Ryding's employment is terminated by the
Company without cause or in certain other circumstances, Dr. Ryding will be paid
at his then annual base salary rate for a period of 12 months following the date
of such termination and he will be entitled to be paid for the cost of 12 months
of health benefits. Dr. Ryding may terminate his employment at any time, but
will forfeit certain benefits if he does not provide the Company with at least
60 days prior written notice.
All of the Company's employees are subject to certain confidentiality and
non-competition obligations. Each employee has also agreed that all inventions,
discoveries and developments which may be used in the Company's business and
that are developed by such employee during his or her employment with the
Company are the Company's property and the employee will assign his or her
rights therein to the Company.
In the event of a change in control of the Company (as defined in the 1993
Plan), all outstanding unvested options, including options held by Dr. Ryding
and Messrs. Burns and Smick, will become immediately vested, unless provision is
made for the continuation of such options pursuant to the applicable provisions
of the 1993 Plan.
KEY-MAN LIFE INSURANCE
The Company is the sole beneficiary on a $2,000,000 term life insurance
policy covering Dr. Ryding.
9
<PAGE> 13
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and officers, and persons who own more than 10% of the Company's
Common Stock, to file with the Securities and Exchange Commission (the "SEC")
initial reports of beneficial ownership and reports of changes in beneficial
ownership of the Common Stock and other equity securities of the Company.
Officers, directors and greater than 10% beneficial owners are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1996, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than 10% beneficial owners were complied with, with the following
exception: Ted R. Dintersmith, a Director of the Company, inadvertently failed
to file a Form 4 in October, 1996 to report a series of three transactions that
occurred in September 1996. Dr. Dintersmith filed a Form 4 in November, 1996 to
correct this matter.
CERTAIN TRANSACTIONS
Angelo V. Alioto, the Company's Vice President of Sales and Marketing, was
granted in April, 1996 an incentive option to purchase 15,000 shares of common
stock at an exercise price of $6.88 per share (for an aggregate exercise price
of $103,200).
In May 1996, the Company granted non-qualified options to purchase 1,250
shares of common stock to each of Dr. Dintersmith, Mr. Hodgson and Dr. Rose at
an exercise price of $10.45 per share (for an aggregate exercise price each of
$13,063). In July, 1996, the Company granted non-qualified options to purchase
8,750 shares of common stock to each of Mr. McGuinness and Dr. Antoniadis at an
exercise price of $6.50 per share (for an aggregate exercise price each of
$56,875).
Bernard F. Cordts III, the Company's Vice President of Wafer Technology,
was granted in April, 1996 an incentive option to purchase 15,000 shares of
Common Stock at an exercise price of $6.88 per share (for an aggregate option
exercise price of $103,200).
Robert P. Dolan, the Company's Vice President of Wafer Manufacturing, was
granted in April, 1996 an incentive option to purchase 15,000 shares of Common
Stock at an exercise price of $6.88 per share (for an aggregate option exercise
price of $103,200). In March and April, 1996, Mr. Dolan exercised options to
purchase 12,925 shares of Common Stock with a realized value at the time of
exercises of $92,774.
10
<PAGE> 14
ELECTION OF DIRECTORS
(NOTICE ITEM 1)
The Company's Restated Articles of Organization and Restated By-Laws
provide for the Company's business to be managed by or under the direction of
the Board of Directors. Under the Company's Restated Articles of Organization
and Restated By-Laws, the number of directors is fixed from time to time by the
Board of Directors. The Board of Directors currently consists of six members,
classified into three classes as follows: Richard Hodgson and Geoffrey Ryding
constitute a class with a term which expires at the upcoming Meeting (the "Class
III directors"); Ted R. Dintersmith and Dimitri Antoniadis constitute a class
with a term ending in 1998 (the "Class I directors"); and Donald F. McGuinness
and Peter H. Rose constitute a class with a term ending in 1999 (the "Class II
directors"). Dr. Dintersmith has resigned effective as of the Meeting. Pursuant
to the Company's Restated By-Laws, the vacancy created by Mr. Dintersmith's
resignation may be filled by a majority vote of the remaining Directors. At each
annual meeting of Stockholders, directors are elected for a full term of three
years to succeed those directors whose terms are expiring.
Pursuant to the Company's Restated Articles of Organization and Restated
By-Laws, the Board of Directors on January 30, 1997 voted (i) to set the size of
the Board of Directors at six and to (ii) to nominate Richard Hodgson and
Geoffrey Ryding for election at the Meeting for a term of three years to serve
until the 2000 annual meeting of Stockholders, and until their respective
successors have been elected and qualified. Dimitri Antoniadis (a Class I
director), and Donald F. McGuinness and Peter H. Rose (the Class II directors)
will serve until the annual meetings of Stockholders to be held in 1998 and
1999, respectively, and until their respective successors have been elected and
qualified. Ted R. Dintersmith (a Class I director) will serve until his
resignation becomes effective as of the Meeting.
Unless authority to vote for any of the nominees named below is withheld,
the shares represented by the enclosed proxy will be voted FOR the election as
directors of such nominees. In the event that any nominee shall become unable or
unwilling to serve, the shares represented by the enclosed proxy will be voted
for the election of such other person as the Board of Directors may recommend in
his place. The Board has no reason to believe that any nominee will be unable or
unwilling to serve.
A plurality of the shares voted affirmatively or negatively at the Meeting
is required to elect each nominee as a director.
THE BOARD OF DIRECTORS RECOMMENDS THE ELECTION OF RICHARD HODGSON AND
GEOFFREY RYDING AS DIRECTORS, AND PROXIES SOLICITED BY THE BOARD WILL BE VOTED
IN FAVOR THEREOF UNLESS A STOCKHOLDER HAS INDICATED OTHERWISE ON THE PROXY.
INDEPENDENT PUBLIC ACCOUNTANTS
(NOTICE ITEM 2)
The Board of Directors has appointed KPMG Peat Marwick LLP, independent
public accountants, to audit the financial statements of the Company for the
fiscal year ending December 31, 1997. The Board proposes that the Stockholders
ratify this appointment. KPMG Peat Marwick LLP audited the Company's financial
statements for the fiscal year ended December 31, 1996. The Company expects that
representatives of KPMG Peat Marwick LLP will be present at the Meeting, with
the opportunity to make a statement if they so desire, and will be available to
respond to appropriate questions.
11
<PAGE> 15
In the event that ratification of the appointment of KPMG Peat Marwick LLP
as the independent public accountants for the Company is not obtained at the
Meeting, the Board of Directors will reconsider its appointment.
The affirmative vote of a majority of the shares voted affirmatively or
negatively at the Meeting is required to ratify the appointment of the
independent public accountants.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE TO APPROVE THE RATIFICATION OF THE
APPOINTMENT OF KPMG PEAT MARWICK LLP AS INDEPENDENT PUBLIC ACCOUNTANTS, AND
PROXIES SOLICITED BY THE BOARD WILL BE VOTED IN FAVOR THEREOF UNLESS A
STOCKHOLDER HAS INDICATED OTHERWISE ON THE PROXY.
OTHER MATTERS
The Board of Directors knows of no other business which will be presented
to the Meeting. If any other business is properly brought before the Meeting, it
is intended that proxies in the enclosed form will be voted in respect thereof
in accordance with the judgment of the persons voting the proxies.
STOCKHOLDER PROPOSALS
To be considered for presentation at the Annual Meeting of Stockholders to
be held in 1998, Stockholder proposals must be received, marked for the
attention of: Clerk, Ibis Technology Corporation, 32 Cherry Hill Drive, Danvers,
Massachusetts 01923, not later than November 30, 1997.
ANNUAL REPORT
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K, AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, MAY BE OBTAINED BY ANY STOCKHOLDER WITHOUT
CHARGE AT THEIR REQUEST BY WRITING TO:
INVESTOR RELATIONS
IBIS TECHNOLOGY CORPORATION
32 CHERRY HILL DRIVE
DANVERS, MASSACHUSETTS 01923
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING, YOU ARE URGED TO
FILL OUT, SIGN, DATE AND RETURN THE ENCLOSED PROXY AT YOUR EARLIEST CONVENIENCE.
By order of the Board of Directors:
Timothy J. Burns
Clerk
March 31, 1997
12
<PAGE> 16
IBIS TECHNOLOGY CORPORATION
THIS PROXY IS BEING SOLICITED BY IBIS TECHNOLOGY CORPORATION'S BOARD OF
DIRECTORS
The undersigned, revoking any previous proxies relating to these shares, hereby
acknowledges receipt of the Notice and Proxy Statement dated March 31, 1997 in
connection with the Annual Meeting to held at 12:00 noon on Thursday, May 15,
1997, at the offices of Ibis Technology Corporation (the "Company") at 32 Cherry
Hill Drive, Danvers, Massachusetts 01923 and hereby appoints Geoffrey Ryding and
Timothy J. Burns, and each of them (with full power to act alone), the attorneys
and proxies of the undersigned, with power of substitution to each, to vote all
shares of the Common Stock of the Company registered in the name provided herein
which the undersigned is entitled to vote at the 1997 Annual Meeting of
Stockholders, and at any adjournments thereof, with all the powers the
undersigned would have if personally present. Without limiting the general
authorization hereby given, said proxies are, and each of them is, instructed to
vote or act as follows on the proposals set forth in said Proxy.
THIS PROXY WHEN EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO
DIRECTION IS MADE THIS PROXY WILL BE VOTED FOR THE ELECTION OF DIRECTORS AND FOR
PROPOSAL 2.
In their discretion the proxies are authorized to vote upon such other matters
as may properly come before the meeting or any adjournments thereof.
Election of Class III Directors (or if any nominee is not available for
election, such substitute as the Board of Directors may designate):
Nominees: Richard Hodgson and Geoffrey Ryding
SEE REVERSE SIDE FOR PROPOSALS 1 and 2. If you wish to vote in accordance with
the Board of Directors' recommendations, just sign on the reverse side. You need
not mark any boxes.
(SEE REVERSE SIDE)
[X] Please mark votes as in this example.
The Board of Directors recommends a vote FOR Proposals 1 and 2.
1. Election of two (2) Class III Directors: Richard Hodgson and Geoffrey
Ryding.
[ ] FOR [ ] WITHHELD [ ] For all nominees except as noted___________
2. Proposal to Ratify the Appointment of KPMG Peat Marwick LLP as the Company's
independent public accountants for the fiscal year ending December 31, 1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
Please sign exactly as name(s) appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such.
Signature ___________________ Date ________
Signature ___________________ Date ________
