<PAGE>
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
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 [_] 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 Rule 14a-11(c) or Rule 14a-12
SYQUEST TECHNOLOGY, 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.
(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:
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<PAGE>
SYQUEST TECHNOLOGY, INC.
47071 BAYSIDE PARKWAY
FREMONT, CALIFORNIA 94538
(510) 226-4000
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
----------------
TO BE HELD ON MAY 6, 1997
TO OUR STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of SYQUEST
TECHNOLOGY, INC. (the "Company"), a Delaware corporation, will be held on May
6, 1997, at 9:00 a.m., Pacific Daylight Savings Time, at the Company's
principal executive offices at 47071 Bayside Parkway, Fremont, California
94538, for the following purposes:
1. To elect directors to serve for the ensuing year and until their
successors are elected.
2. To approve an amendment to the Company's Certificate of Incorporation
to increase the number of authorized shares of the Company's Common Stock
from 60,000,000 to 120,000,000 and to decrease the stated par value of the
Company's Common Stock and Preferred Stock from $0.001 to $0.0001.
3. To ratify the appointment of Price Waterhouse LLP as independent
accountants of the Company for the fiscal year ending September 30, 1997.
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on April 4, 1997, are
entitled to notice of and to vote at the meeting.
All stockholders are cordially invited to attend the meeting in person. To
assure your representation at the meeting, however, you are urged to mark,
sign, date and return the enclosed proxy card as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. Any stockholder attending
the meeting may vote in person even if he or she has returned a proxy.
By Order of the Board of Directors,
Thomas C. Tokos
Secretary
Fremont, California
April 16, 1997
YOUR VOTE IS IMPORTANT
IN ORDER TO ASSURE YOUR REPRESENTATION AT THE MEETING, YOU ARE REQUESTED TO
COMPLETE, SIGN AND DATE THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE AND RETURN
IT IN THE ENCLOSED ENVELOPE.
<PAGE>
SYQUEST TECHNOLOGY, INC.
47071 BAYSIDE PARKWAY
FREMONT, CALIFORNIA 94538
----------------
PROXY STATEMENT FOR ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON MAY 6, 1997
----------------
The accompanying Proxy is solicited on behalf of the Board of Directors of
SYQUEST TECHNOLOGY, INC. (the "Company") for use at the Annual Meeting of
Stockholders to be held on Tuesday, May 6, 1997, at 9:00 a.m., Pacific
Daylight Savings Time, or at any continuation or adjournment thereof, for the
purposes set forth in the accompanying Notice of Annual Meeting of
Stockholders. The Annual Meeting will be held at the Company's principal
executive offices, 47071 Bayside Parkway, Fremont, California 94538. The
Company's telephone number at that location is (510) 226-4000.
These proxy solicitation materials and the accompanying Annual Report to
Stockholders for the fiscal year ended September 30, 1996, will first be
mailed to stockholders on or about April 16, 1997.
GENERAL INFORMATION
RECORD DATE AND VOTING SECURITIES
Only holders of record of the Company's Common Stock, $.001 par value, at
the close of business on April 4, 1997 (the "Record Date"), are entitled to
notice of and to vote at the meeting. On the Record Date, 43,038,684 shares of
the Company's Common Stock, $.001 par value, were issued and outstanding. For
information concerning beneficial owners of more than five percent of the
Company's Common Stock, see "Security Ownership of Management and Certain
Beneficial Owners."
VOTING AND REVOCABILITY OF PROXIES
The Common Stock represented by valid proxies received, properly dated and
executed, and not revoked, will be voted at the Annual Meeting in accordance
with the instructions thereon. If, however, voting instructions are not given
on the proxy, the shares represented thereby will be voted for the four
nominees for director listed herein, and for each other proposal described in
this Proxy Statement. Any proxy given pursuant to this solicitation may be
revoked by the person giving it at any time prior to the time it is voted by
delivering to the Secretary of the Company, no later than the start of the
Annual Meeting, a written notice of revocation or a duly executed proxy
bearing a later date than the revoked proxy, or by attending the Annual
Meeting and voting in person.
Each holder of shares of Common Stock is entitled to one vote for each share
on the proposals presented in this Proxy Statement. The Company's Bylaws
provide that a majority of all of the shares of the stock entitled to vote,
whether present in person or represented by proxy, shall constitute a quorum
for the transaction of business at the meeting. If a proxy is accompanied by
instructions to withhold authority, or is marked with an abstention, the
shares represented thereby will be considered to be present at the meeting for
purposes of determining the existence of a quorum for the transaction of
business.
Abstentions will be treated as shares that are present and entitled to vote
for purposes of determining the presence of a quorum, but the Company will not
treat abstentions as votes in favor of approving any matter submitted to the
stockholders for a vote. Shares held by brokers that are present, but not
voted on a particular matter because the brokers were prohibited from
exercising discretionary authority on that matter (that is, "broker non-
votes"), will also be treated as present for determining the presence of a
quorum for the meeting, but will not be considered as present with respect to
that matter. The Company believes that these tabulation procedures are
consistent with Delaware statutory requirements concerning voting of shares
and determination of a quorum.
1
<PAGE>
SOLICITATION EXPENSES
The Company will bear the expense of preparing, printing and mailing this
Proxy Statement and the proxies solicited hereby and will reimburse brokerage
firms and other persons representing beneficial owners of shares of Common
Stock for their expenses in forwarding solicitation material to such
beneficial owners. In addition to the solicitation of proxies by mail,
solicitation may be made by certain officers and other employees by personal
interview, telephone or facsimile; no additional compensation will be paid for
such solicitation. The Company has retained McKenzie Partners, at an estimated
cost of $7,500.00 plus reimbursement of reasonable expenses, to assist in the
solicitation of proxies from brokers, nominees, institutions and individuals.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
NOMINEES
The Company's By-laws provide that the number of directors shall not be less
than four nor more than nine and the exact number of directors is currently
fixed at four. Accordingly, a board of four directors is to be elected at the
Annual Meeting. Unless otherwise instructed, the proxy holders will vote the
proxies received by them for the Company's four nominees named below, all of
whom are currently directors of the Company:
JOSEPH BAIA
EDWIN L. HARPER
C. RICHARD KRAMLICH
EDWARD L. MARINARO
If any such nominee is unable or unwilling to accept nomination or election,
the proxies will be voted for such substitute nominee as the Board of
Directors may designate. The Board of Directors knows of no reason why any
nominee might be unable to refuse to accept nomination or election. The term
of office for each person elected as a director will continue until the Annual
Meeting of Stockholders in 1998 and until their successors are elected and
qualify. The following sets forth certain information concerning the nominees:
JOSEPH BAIA, age 65, has been a director of the Company since July 1996. He
has been Vice President of Operations at Indigita Corporation since September
1996. From September 1995 to September 1996, Mr. Baia was an independent
consultant in the area of operations and management. From 1994 to September
1995, Mr. Baia was a consultant to Q Logic Corporation acting in the capacity
of Vice President of Manufacturing and Quality. From 1988 to 1993, Mr Baia was
President of Manufacturing Concepts and Technologies, Inc., a consulting firm.
Mr. Baia was also a co-founder of Western Digital Corporation.
EDWIN L. HARPER, age 52, joined the Company as President in May 1996 and has
served as Director, President and Chief Executive Officer of the Company since
June 1996. Prior to joining the Company, from May 1993 to April 1996, Mr.
Harper was President and Chief Executive Officer of Combyte, Inc., a
manufacturer of storage products. Mr. Harper was employed by Colorado Memory
Systems, Inc., a manufacturer of tape storage products, in various capacities
from 1988 to 1993, including President and Chief Executive Officer. Mr. Harper
serves on the boards of directors of McAfee Associates, Inc. and Apex PC
Solutions, Inc.
C. RICHARD KRAMLICH, age 61, has been a director of the Company since 1983.
Mr Kramlich has been the Managing General Partner of New Enterprise
Associates, a venture capital firm, since 1978. He is also a General Partner
of four affiliated venture capital investment funds. Mr. Kramlich serves on
the Board of Directors of Chalone, Inc., Sierra Monitor Corporation, Silicon
Graphics, Inc., Lumisys, Inc., Ascend Communications, Inc., Macromedia, Inc.
and Graphix Zone, Inc.
EDWARD L. MARINARO, age 58, has been Chairman of the Board of the Company
since May 1996 and has been a director since February 1996. From January 1996
through August 1996, Mr. Marinaro served as Vice Chairman of the Board of
Directors for Network Computing Devices ("NCD"). He served as President and
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<PAGE>
Chief Executive Officer of NCD from September 1994 to January 1996. From
October 1989 to September 1994, he served as Director and executive consultant
to a number of companies, such as World Wide Technology, a synchronous
hardware and software products company; Computone Corporation, a synchronous
communication products company; and Radius Corporation, a manufacturer of
personal computer monitors, video graphic and multimedia products. From June
1988 to October 1989, Mr. Marinaro was President and Chief Operating Officer
of Cipher Data Products, a tape storage company. Prior to that, he held
various management positions at Western Digital Corporation, Memorex
Corporation, Digital Corporation and IBM.
David I. Caplan, age 67, and a director of the Company since 1987, has
informed the Company that he does not intend to stand for re-election to the
Board. Accordingly, his name has not been placed in nomination for re-
election. Mr. Caplan is a member of the Company's Audit Committee, Stock
Option Committee, Compensation Committee and Human Resources Committee. His
replacement on these committees has yet to be determined.
VOTE REQUIRED: The four nominees for director receiving the highest number
of affirmative vote of the shares entitled to vote at the Annual Meeting will
be elected.
RECOMMENDATION
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" THE NOMINEES LISTED ABOVE.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of sixteen meetings
during fiscal 1996, and no director attended fewer than seventy-five percent
of the meetings of the Board of Directors and committees thereof, if any, on
which such director served and which meetings were held during the period that
such person served on the Board or such committee. The Board of Directors has
an Audit Committee, a Stock Option Committee, a Compensation Committee and a
Human Resources Committee.
The Audit Committee, which consists of Messrs. Kramlich and Caplan, met two
times during fiscal 1996. The Audit Committee makes recommendations to the
Board of Directors concerning the employment of independent accountants, the
audited and unaudited financial statements of the Company and the Company's
financial and accounting controls and systems.
The Stock Option Committee, which consists of Messrs. Kramlich and Caplan,
met four times during fiscal 1996. This committee administers the Company's
1991 Stock Option Plan and authorizes the grant of options thereunder.
The Compensation Committee, which consists of Messrs. Kramlich and Caplan,
met four times during fiscal 1996. This committee administers the Company's
1992 Employee Stock Purchase Plan and reviews proposals and makes
recommendations to the Board of Directors concerning corporate compensation
and benefits.
The Human Resources Committee, which consists of Messrs. Kramlich and
Caplan, met four times during fiscal 1996. This committee reviews and makes
recommendations to the Board of Directors concerning matters involving
employees of the Company (other than matters within the authority of the
Compensation Committee or the Stock Option Committee), including incentive
programs generally, management methods, employee review procedures,
termination and disciplinary matters, plant security, employee attitudes,
prerequisite programs and officer status changes.
As discussed above, Mr. Caplan will not seek re-election to the Board. His
replacement on these committees has yet to be determined.
The Board of Directors has no nominating committee or any other committee
performing a similar function.
3
<PAGE>
OTHER EXECUTIVE OFFICERS
The following are additional executive officers of the Company. All
executive officers serve at the discretion of the Board of Directors, subject
to the terms of any employment agreements:
CHESTER A. BROWN, Jr. age 58, was named Executive Vice President, Sales and
Marketing of the Company in February 1996. Prior to joining the Company, from
April 1994 to December 1995, he served as President and CEO of Cubic Memory
Incorporated, a direct random access memory array manufacturer. From February
1993 to April 1994, Mr. Brown was Vice President of Marketing and Operations
of Q Logic Corporation, a fast input/output semiconductor company. Since
January 1990 Mr. Brown has served as a member of the board of directors of
Prisma Devices, Inc., a high-end video semiconductor company.
HENRY C. MONTGOMERY, age 61, joined the Company as its Executive Vice
President, Finance and Chief Financial Officer in November 1996. Prior to
joining the Company, from September 1995 to November 1996, Mr. Montgomery
served as President and Chief Executive Officer of New Media Corporation, a
privately held company which provides PCMCIA products for the computer
industry. Since 1986, Mr. Montgomery has served as Founder and Chairman of
Montgomery Financial Services Corporation and its predecessor firm, a private
management consulting, financial and accounting services company. Mr.
Montgomery has served on the board of directors of Swift Energy Company, a
public oil and gas company since 1987. Previously, he served on the boards of
directors of Catalyst Semiconductor, Inc. (1989 to 1995) and Southwall
Technologies, Inc. (1972 to 1995).
DALE W. PILGERAM, age 53, was named Executive Vice President and Chief
Technical Officer of the Company in March 1996. Before joining the Company,
from March 1994 to February 1996, Mr. Pilgeram was employed as a consultant
with the consulting firm of Time to Market Solutions. From August 1992 to
February 1994, Mr. Pilgeram was Vice President of the Open Systems Storage
Business Unit at IBM. From 1989 to August 1992, he served as Vice President of
Storage Products Development at IBM.
JOSEPH B. SMITH, age 55, was named Executive Vice President, Global
Operations of the Company in September 1996. Previously, Mr. Smith was vice
president of operations at Western Digital Corporation, a disk drive
manufacturer, from January 1987 until his retirement in July 1993.
THOMAS C. TOKOS, age 44, joined the Company in December 1996 as Vice
President, General Counsel and Secretary. From October 1994 until joining the
Company, Mr. Tokos was Assistant General Counsel and Assistant Secretary of
VLSI Technology, Inc., a semiconductor manufacturer. Mr. Tokos was a partner
in the corporate law firm of Keck, Mahin & Cate from March 1993 to September
1994 and was associated with the corporate law firm of Shearman & Sterling
from 1988 to 1993.
PROPOSAL NO. 2
AMENDMENT TO THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION
The Board of Directors of the Company has adopted a resolution to amend
paragraph (A) of Article IV of the Restated Certificate of Incorporation of
the Company to read in its entirety as follows:
(A) CLASSES OF STOCK. This corporation is authorized to issue the
following classes of stock: Common Stock ("Common Stock" or "Common") and
Preferred Stock ("Preferred Stock" or "Preferred"). The total number of
shares which the corporation is authorized to issue is One Hundred Twenty-
Four Million (124,000,000). One Hundred Twenty Million (120,000,000) shares
shall be Common Stock and Four Million (4,000,000) shares shall be
Preferred Stock. Each share of Common and Preferred Stock shall have a par
value of $0.0001.
The purpose of such amendment is to increase the number of authorized shares
of the Company's Common Stock from 60,000,000 to 120,000,000 shares and to
decrease the stated par value of the Company's Common
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<PAGE>
and Preferred Stock from $0.001 to $0.0001. As of March 3, 1997 the Company
had outstanding 37,657,012 shares of Common Stock and approximately 16,100,000
shares of Common Stock reserved for issuance as follows:
Common shares reserved for:
<TABLE>
<S> <C>
Conversion of Preferred Stock and exercise of Warrants(1).... 12,772,652
Exercise of 6% Convertible Debenture......................... 400,000
Issuance under 1991 Stock Option Plan........................ 2,756,305
Issuance under the 1992 Non-Employee Director Stock Option
Plan........................................................ 160,000
Issuance under the 1992 Employee Stock Purchase Plan......... 296,867
Issuance under Accrued Vacation Exchange Plan................ 170,140
</TABLE>
- --------
(1) Amount of shares reserved is based on the hypothetical conversion of
preferred stock and exercise of warrants on March 3, 1997.
As reported by the Company in its filings with the Securities and Exchange
Commission, the Company had significant losses in fiscal 1996 (aggregating
$136,651,000), and will need additional cash to meet its commitments. As set
forth above, the Company currently has a total of sixty million (60,000,000)
shares of Common Stock authorized and as of March 3, 1997 has issued or
reserved nearly 54,200,000 shares of Common Stock. Without an increase in the
authorized number of shares, the Company believes that it will not be able to
raise that cash, because the number of shares of Common Stock currently
authorized is inadequate to permit the Company to issue a sufficient number of
additional shares of Common Stock, warrants to purchase Common Stock or
Preferred Stock convertible into Common Stock, to raise additional capital. In
addition, given the Company's losses, it may be necessary for the Company to
raise additional equity to satisfy the listing requirements for the Nasdaq
Stock Market. The capital that would be raised from the sale of the increased
number of authorized shares would assist the Company in meeting the Nasdaq
listing requirements.
The Company recently sold Fletcher International Limited ("Fletcher")
$5,000,000 of preferred stock that is convertible into Common Stock and
granted Fletcher a warrant to purchase 5,000,000 shares of the Company's
Common Stock. As the Company does not currently have sufficient shares of
Common Stock for conversion of all the preferred stock and exercise of all the
warrants, the Company's agreement with Fletcher requires the Company to pay to
Fletcher, based on the current market price, approximately $5,000,000 if
Fletcher seeks to convert preferred stock or exercise the warrant and the
Company is unable to deliver the corresponding Common Stock. In such an event,
the Company will be required to make cash payment within three months equal to
the market value of the Common Stock that would be issuable on conversion or
exercise using the closing price of the Common Stock at the date the
conversion or exercise is requested. Any balance owed will accrue interest at
an annual rate of 15%. Stockholder approval of this Proposal will eliminate
the Company's obligation to make such payment with such interest. As an
additional penalty if this Proposal is not passed, the warrant issued to
Fletcher will become exercisable for an additional 500,000 shares of the
Company's Common Stock for each month (on a pro rata basis) after the date of
the annual meeting of stockholders, but in no event later than June 1, 1997,
that the Company is unable to reserve sufficient shares of Common Stock
necessary to issue Fletcher upon the hypothetical conversion of all preferred
shares and the exercise of the warrant.
This amendment will, in the opinion of the Board Directors, increase the
Company's financial flexibility in attempting to raise additional capital. The
Board of Directors of the Company believes that the complexity of business
financing and acquisition transactions require greater flexibility in the
Company's capital structure than now exists. Preferred Stock is available for
issuance, but this amendment will permit the Company to offer additional
shares of Preferred Stock that are convertible into Common Stock, from time to
time as determined by the Board for any corporate purpose. Such purposes could
include, without limitation, issuance in public or private sales for cash as a
means of obtaining capital for use in the Company's business and operations or
in cancellation of existing indebtedness, as part or all of the consideration
for acquisitions by the Company of other businesses or properties, and
issuance under employee benefit plans. The Company intends to enter into such
financing transactions in the immediate future in order to raise capital
pursuant to which it would issue (or
5
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obligate itself to issue) some of the shares of Common Stock that would be
authorized if this Proposal is approved. The precise terms of such
transactions, however, have not as yet been determined.
The Company can give no assurance, however, even if the proposed amendment
is adopted, that the Company will be successful in raising additional capital,
or maintaining its listing on the Nasdaq Market.
Approval of the increase now will eliminate delays and expense that
otherwise would be incurred if stockholder approval were required to increase
the authorized number of shares of Common Stock for possible future
transactions involving the issuance of additional shares. The rules of the
National Association of Securities Dealers, Inc. ("NASD") governing
corporations with securities listed on the Nasdaq Stock Market would
nevertheless require stockholder approval by a majority of the total votes
cast in person or by proxy prior to the issuance of designated securities (a)
where the issuance would result in a change of control of the Company, (b) in
connection with the acquisition of the stock or assets of another company if
an affiliate of the Company has certain interlocking interests with the
company to be acquired or where the Company issues twenty percent or more of
its outstanding shares or (c) in connection with a transaction other than a
public offering involving the sale or issuance of twenty percent or more of
the Common Stock or voting power outstanding before the issuance at less than
the book value or market value of the Company's shares at that time, subject
to certain exceptions or application to Nasdaq if delay in the issuance would
impair the financial viability of the Company. Violation of these rules could
result in the Company's Common Stock being removed from listing on the Nasdaq
Stock Market.
The additional shares of Common Stock may be issued, subject to certain
exceptions, by the Company's Board of Directors at such times, in such amounts
and on such terms as the Board may determine, without further approval of the
stockholders. Any such issuance could reduce the current stockholders'
proportionate interests in the Company or dilute the stock ownership of
persons seeking to obtain control of the Company, depending on the number
shares issued and the purpose, terms and conditions of the issuance.
Stockholders have no preemptive rights to subscribe for additional shares
although certain holders of the Company's 7% Cumulative Convertible Preferred
Stock, have a right of first refusal with regard to participation in future
financing transactions of the Company.
Increasing the number of shares of Common Stock authorized for issuance
could discourage attempts to acquire control of the Company by tender offer or
other means, if significant additional shares of Common Stock are issued or
reserved for issuance. It could therefore deprive stockholders of benefits
that could result from such an attempt, such as realization of a premium over
the market price of their shares in a tender offer or the temporary increase
in market price that could result from such an attempt. Moreover, the issuance
of stock to persons friendly to the Board of Directors could make it more
difficult to remove incumbent management and directors from office even if
such change would be favorable to the stockholders generally.
The Board of Directors believes that the financial flexibility offered by
the amendment increasing the number of authorized shares of Common Stock
(particularly in light of the need of the Company to raise additional capital)
outweighs any of its potential disadvantages.
The company currently computes certain state taxes on the basis of the par
value of the Company's authorized stock. The purpose of the proposed reduction
in par value of the Company's authorized stock is to reduce the amount of such
taxes.
VOTE REQUIRED
The approval of the amendment of the Company's Restated Certificate of
Incorporation requires the affirmative vote of the holders of a majority of
the outstanding shares of Common Stock entitled to vote. CONSEQUENTLY,
ABSTENTIONS AND BROKER NON-VOTES WILL HAVE THE EFFECT OF A VOTE AGAINST THE
PROPOSED AMENDMENT.
RECOMMENDATION
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT TO
THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION.
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<PAGE>
PROPOSAL NO. 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Company has appointed the accounting firm of Price Waterhouse LLP to act
as its independent accountants for the fiscal year ending September 30, 1997,
and recommends that stockholders vote to ratify such appointment. If the
appointment is not ratified, the Board of Directors will reconsider the
Company's selection.
The Company had engaged the accounting firm of Ernst & Young LLP ("E&Y") as
its independent auditors from 1982 until the Company dismissed E&Y on January
23, 1997. E&Y confirmed its dismissal to the Company by letter dated January
24, 1997, and received by the Company on January 27, 1997. The Company's
decision to replace E&Y with Price Waterhouse LLP as the Company's independent
accountants was concurred with by the Company's Audit Committee and approved
by its Board of Directors.
E&Y's reports on the Company's financial statements for the past two fiscal
years did not contain an adverse opinion or a disclaimer of opinion nor were
they qualified or modified as to uncertainty, audit scope or accounting
principles. During the Company's two most recent fiscal years ended September
30, 1996, and for all subsequent interim periods preceding the dismissal of
E&Y on January 23, 1997, there were no disagreements, as that term is used in
paragraph (a)(1)(iv) of Item 304 ("Item 304") of Regulation S-K promulgated by
the Securities and Exchange Commission (the "SEC"), between the Company and
E&Y, which, if not resolved to the satisfaction of E&Y, would have caused E&Y
to refer thereto in their reports on the Company's financial statements for
such periods. During the Company's two most recent fiscal years, and for all
subsequent interim periods preceding the dismissal of E&Y on January 23, 1997,
there were no reportable events, as defined in paragraph (a)(1)(v) of Item
304, with respect to E&Y, except as set forth in a letter from E&Y to the
Company's Audit Committee, dated December 11, 1996, but not provided to the
Company until January 29, 1997, noting a material weakness in the Company's
internal control structure relative to the preparation of accurate financial
statements in a timely fashion for the Company's fiscal year ended September
30, 1996. During the Company's two most recent fiscal years ended September
30, 1996, and for all subsequent interim periods preceding the dismissal of
E&Y on January 23, 1997, the Company did not consult Price Waterhouse LLP
regarding the application of accounting principles to a specified transaction
or the type of audit opinion that might be rendered on the Company's financial
statements or regarding any matter that was either subject to a disagreement
or a reportable event, as those terms are used in paragraphs (a)(1)(iv) and
(a)(1)(v), respectively, of Item 304.
Representatives of Price Waterhouse LLP are expected to be present at the
meeting with the opportunity to make a statement if they desire to do so and
are expected to be available to respond to appropriate questions.
RECOMMENDATION
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF PRICE WATERHOUSE LLP AS INDEPENDENT ACCOUNTANTS.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth beneficial ownership of Common Stock of the
Company as of March 3, 1997 by (i) each present director and nominee, (ii)
each executive officer of the Company, including certain former executive
officers of the Company named in the Summary Compensation Table set forth
below, (iii) all present directors and executive officers as a group, and (iv)
all persons known to the Company to be the beneficial owners of more than five
percent of the Company's Common Stock, the only class of voting securities of
the Company outstanding. The table does not include the holders of the
Company's outstanding 7% Cumulative Convertible Preferred Stock, Series 1 (the
"7% Convertible Preferred") because a holder of 7% Convertible Preferred Stock
is not permitted to convert shares of Preferred Stock at any time when the
conversion would
7
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result in such holder and its affiliates having beneficial ownership of more
than four and nine-tenths percent (the "4.9% Restriction") of the outstanding
Common Stock of the Company.(1)
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED(1)
----------------------------------
NUMBER OF SHARES PERCENT OF SHARES
---------------- -----------------
<S> <C> <C>
All current directors and executive
officers of the Company as a group (9
persons)............................. -- *
</TABLE>
- --------
* Less than one percent.
(1) At March 3, 1997, assuming the 4.9% Restriction did not apply, the
outstanding 7% Cumulative Convertible Preferred Stock was convertible into
3,891,261 shares of Common Stock (10.34% of the outstanding shares of
Common Stock) and holders of the 7% Cumulative Convertible Preferred Stock
also held 5,902,379 shares of Common Stock (15.67% of the outstanding
Common Stock). Additionally, the Convertible Preferred Stock was converted
into a total of 3,333,372 shares of Common Stock or 8.85% of the
outstanding shares of Common Stock. The Convertible Preferred Stock Series
1 holders also hold warrants to purchase and additional 1,096,670 shares
of Common Stock or 2.91% of the outstanding shares of Common Stock. All 5%
Cumulative Preferred Stock Series 2 Stock was converted into a total of
12,440,448 shares of Common Stock or 33.03% of the outstanding shares of
Common Stock. The 5% Cumulative Convertible Preferred Stock Series 2
stockholders also hold warrants to purchase an additional 4,146,810 shares
of Common Stock or 11.01% of the outstanding shares of Common Stock.
EXECUTIVE COMPENSATION AND OTHER MATTERS
GENERAL
Shown below is information concerning the annual and long-term compensation
for services in all capacities to the Company for the fiscal years ended
September 30, 1996, 1995 and 1994, of the Chief Executive Office of the
Company and the four other most highly compensated executive officers with the
Company at the year ended September 30, 1996, along with information for the
two most highly compensated executive officers employed by the Company during
fiscal 1996 that are no longer with the Company (collectively the "Named
Executive Officers"). Compensation information is only included for those
years during which the named individual served as an executive officer of the
Company.
8
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
-------------------- ------------
NUMBER OF
SHARES
UNDERLYING ALL OTHER
FISCAL OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITIONS YEAR SALARY ($) BONUS ($) GRANTED ($)
- ---------------------------- ------ ---------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Edwin L. Harper(1).......... 1996 113,665 0 390,000 14,175(2)
President and Chief
Executive Officer
Edward L. Marinaro(3)....... 1996 99,662 0 390,000 8,500(4)
Chairman of the Board
Chester A. Brown............ 1996 161,267 0 100,000 1,000(5)
Executive Vice
President, Sales and
Marketing
Dale W. Pilgeram(6)......... 1996 139,927 0 100,000 1,000(7)
Vice President, Chief
Technical Officer
Syed H. Iftikar(8).......... 1996 314,765 0 20,000 1,000(8)
Chairman of the Board,
President and Chief 1995 320,811 0 0 1,000(9)
Executive Officer 1994 319,992 0 45,000 500(9)
Michael J. Perez(10)........ 1996 16,538 0 0 188,574(11)
Senior Vice President--
Finance, Chief Financial 1995 215,543 0 0 0
Officer 1994 203,342 0 0 0
Robert E. Lyon(12).......... 1996 187,039 0 9,750 0
Vice President, Human 1995 127,778 0 30,000 0
Resources
</TABLE>
- --------
(1) Joined the Company in May 1996. Fiscal 1996 salary includes $29,423,
deferred until fiscal 1997 at Mr. Harper's election. Such deferred
compensation accrues interest at ten percent per annum, compounded
quarterly.
(2) Represents moving expenses.
(3) Joined the Company in May 1996. Fiscal 1996 salary includes $29,423,
deferred until fiscal 1997 at Mr. Marinaro's election. Such deferred
compensation accrues interest at ten percent per annum, compounded
quarterly.
(4) Represents the Company's maximum contribution to Mr. Marinaro's 401(k)
plan ($1,000), plus $7,500 paid to Mr. Marinaro for his attendance at
meetings of the Board of Directors before he became Chairman of the
Board.
(5) Represents the Company's maximum contribution to Mr. Brown's 401(k) plan.
(6) Includes $10,000 paid to Mr. Pilgeram as a private contractor prior to
his employment with the Company.
(7) Represents the Company's maximum contribution to Mr. Pilgeram's 401(k)
plan.
(8) Left the Company in July 1996.
(9) Represents the Company's maximum contribution to Mr. Iftikar's 401(k)
plan.
(10) Left the Company in October 1995.
(11) Represents severance compensation paid upon departure from the Company.
(12) Left the Company in August 1996.
9
<PAGE>
The following table sets forth information with respect to each grant of
options to purchase the Company's Common Stock made during the last fiscal
year to each of the Named Executive Officers named in the Summary Compensation
Table.
OPTION GRANTS IN FISCAL YEAR 1996
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
---------------------------------------------
% OF TOTAL POTENTIAL REALIZABLE VALUE
NO. OF OPTIONS AT ASSUMED ANNUAL RATES
SECURITIES GRANTED TO EXERCISE OF STOCK PRICE APPRECIATION
NAME UNDERLYING EMPLOYEES OR BASE FOR OPTION TERM(3)
---- OPTIONS IN FISCAL PRICE (2) EXPIRATION -----------------------------
GRANTED(1) YEAR ($/SHARES) DATE 5% 10%
---------- ---------- ---------- ---------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Edwin L. Harper......... 390,000(4) 18.247 4.9380 05/13/01 415,026 893,773
Edward L. Marinaro...... 5,000 0.2339 6.7180 02/28/03 7,239 15,589
385,000(5) 18.0135 4.9380 05/13/01 409,705 882,314
Chester A. Brown........ 60,000(4) 2.8073 7.3750 02/28/01 95,362 205,364
40,000(4) 1.8715 4.9380 05/13/01 42,567 91,669
Dale W. Pilgeram........ 40,000(4) 1.8715 7.0000 02/28/01 63,574 136,910
60,000(4) 2.8073 4.9380 05/13/01 63,850 137,504
Syed H. Iftikar(6)...... 20,000(6) 0.9357 11.3750 02/28/01 (6) (6)
Robert E. Lyon.......... 7,500 0.3509 7.3750 02/28/01 (6) (6)
2,250 0.1025 4.9380 05/13/01
Michael J. Perez........ -- -- -- -- -- --
</TABLE>
- --------
(1) All options were granted under the Company's 1991 Stock Option Plan,
except with respect to Mr. Marinaro, who has 5,000 shares under the 1992
Non-Employee Directors Plan.
(2) Options were granted at an exercise price equal to the fair market value
of the Company's Common Stock as determined by reference to the closing
price reported on the Nasdaq National Market system on the last trading
day prior to the date of grant. Exercise price and tax withholding
obligations may be paid in cash or by an alternate method of payment if
authorized by the Board of Directors, such as by delivery of already-owned
shares subject to certain conditions, or pursuant to a cashless exercise
procedure.
(3) Potential realizable value is based on an assumption that the market price
of the stock appreciates at the stated rate, compounded annually, from the
date of grant to the expiration date. These values are calculated as a
result of regulations promulgated by the Securities and Exchange
Commission and do not reflect the Company's estimate of future stock price
appreciation. Actual gains, if any, are dependent on the future market
price of the Company's stock. Gains are reported net of the option
exercise price but before taxes associated with exercise.
(4) Options vest over four years.
(5) 128,334 vested immediately upon grant date and the remaining 261,666 will
vest over three years.
(6) Not applicable to Mr. Iftikar's and Mr. Lyon's options, which expired on
termination of their respective employment with the Company.
10
<PAGE>
The following table sets forth information with respect to option exercises
and year-end stock option values for each of the Named Executive Officers.
AGGREGATED OPTIONS EXERCISED IN FISCAL YEAR 1996
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT FY-END AT FISCAL YEAR END(1)
------------------------- -------------------------
SHARES
ACQUIRED VALUE
NAME ON EXERCISE REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Edwin L. Harper......... -- -- -- 390,000 -- $536,250
Edward L. Marinaro...... -- -- 128,334 261,666 $176,459 $352,916
Chester A. Brown........ -- -- -- 40,000 -- $ 55,000
Dale W. Pilgeram........ -- -- -- 60,000 -- $ 82,500
Syed H. Iftikar......... 231,623 $960,032 40,000 -- -- --
Robert E. Lyon.......... -- -- 7,500 -- -- --
Michael J. Perez........ 25,000 $ 96,875 -- -- -- --
</TABLE>
- --------
(1) Calculated as the difference between the market value of the Company's
Common Stock at exercise date or fiscal year end, as the case may be, and
the exercise price.
CHANGE OF CONTROL PROVISIONS
The 1991 Stock Option Plan of the Company provides for the automatic
acceleration of the vesting of all options outstanding under the Plan on a
merger or consolidation of the Company in which the Company is not the
surviving corporation or on a sale of all or substantially all of the assets
of the Company, if the successor entity does not assume the outstanding
options or provide options in substitution for the outstanding options.
Pursuant to their respective offers of employment, if there is a change in
control of the Company, each of Mr. Harper and Mr. Marinaro, at his option,
will be entitled to twelve months salary, having his outstanding options
immediately vest, and having his health benefits continue for 12 months.
COMPENSATION OF DIRECTORS
Each member of the Board of Directors who is not an employee of the Company
receives an annual retainer of $15,000 for serving as a director during the
fiscal year. Each nonemployee director is also paid a fee of $1,500 for each
Board meeting and $500 for each committee meeting attended. An amendment to
the 1992 Non-Employee Director Stock Option Plan granting each director a one
time option to acquire 30,000 shares of the Company's Common Stock was
approved at the special meeting of the stockholders of the Company on
September 26, 1996. Each director is also granted an option each year to
purchase 10,000 shares of the Company's Common Stock. All options are valued
at the fair market value of the Company's Common Stock on the date of the
grant.
EMPLOYEMENT AGREEMENTS
The Company has previously reported in its Form 10K/A filed January 28,
1997, that it has written employment agreements with certain named executive
officers. Although the information previously reported was correct, upon
further review, it has been determined that such agreements have not yet been
reduced to final form. The Company is in the process of completing these
written agreements, the final terms of which may vary from the terms
previously discussed in the Form 10K/A.
STOCK PERFORMANCE GRAPH
The Stock Performance Graph below shall not be deemed incorporated by
reference in any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933 or the
11
<PAGE>
Securities Exchange Act of 1934, except to the extent that the Company
specifically incorporates this information by reference, and shall not
otherwise be deemed filed under either of such Acts.
The following line graph compares the cumulative total returns to holders of
the Company's Common Stock during the fiscal periods since the Company's
initial public offering to September 30, 1996, with the NASDAQ Composite (US)
Index and a peer group constructed by the Company, comprising Connor
Peripherals, Inc., Maxtor Corporation, Micropolis Corporation, Quantum
Corporation, Western Digital Corporation, Iomega Corporation and Exabyte
Corporation.(1)
The Stock Performance Graph assumes that $100 was invested on December 18,
1991, at the closing sale price for the Company's Common Stock and in the
NASDAQ Composite (US) Index and Peer Group, and that all dividends were
reinvested. No dividends have been declared or paid on the Company's Common
Stock. Stockholder returns over the indicated period should not be considered
indicative of future stockholder returns. Returns for the Peer Group are
weighted based on market capitalization at each data point.
- --------
(1) No data is available for Maxtor Corporation, Micropolis Corporation or
Connor Peripherals, Inc. after February 1996 because these companies were
acquired by other companies.
12
<PAGE>
[STOCK PERFORMANCE GRAPH APPEARS HERE]
SYQUEST TECHNOLOGY
HISTORICAL QUARTERLY PRICE--CLOSE
RELATIVE TO DISK DRIVE COMPANIES AND SELECTED MARKET INDICES
<TABLE>
<CAPTION>
DEC. 91 DEC. 91 MAR 92 JUNE 92 SEP 92
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SyQuest Technologies, Inc............... 100 122 107 165 135
Peer Group.............................. 100 120 139 127 110
NASDAQ Composite (US)................... 100 109 112 104 109
<CAPTION>
DEC 92 MAR 93 JUNE 93 SEP 93 DEC 93
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SyQuest Technologies, Inc............... 200 101 84 82 78
Peer Group.............................. 115 83 62 64 90
NASDAQ Composite (US)................... 126 129 131 142 145
<CAPTION>
MAR 94 JUNE 94 SEP 94 DEC 94 MAR 95
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SyQuest Technologies, Inc............... 86 75 83 139 95
Peer Group.............................. 108 84 96 100 87
NASDAQ Composite (US)................... 139 135 144 142 155
<CAPTION>
JUNE 95 SEP 95 DEC 95 MAR 96 JUNE 96
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
SyQuest Technologies, Inc............... 101 104 78 47 62
Peer Group.............................. 121 123 77 110 272
NASDAQ Composite (US)................... 177 198 201 210 227
<CAPTION>
SEP 96
-------
<S> <C>
SyQuest Technologies, Inc............... 50
Peer Group.............................. 310
NASDAQ Composite (US)................... 235
</TABLE>
13
<PAGE>
REPORT OF THE STOCK OPTION COMMITTEE,
THE COMPENSATION COMMITTEE
AND THE HUMAN RESOURCES COMMITTEE
The role of the Stock Option Committee, the Compensation Committee, and the
Human Resources Committee (the "Committees") is to administer the Company's
1991 Stock Option Plan and authorize the grant of options to all employees,
including the executive officers; administer the Company's 1992 Employee Stock
Purchase Plan; review and recommend salaries and incentive programs and review
and recommend executive officers' compensation under the aforementioned
elements. The Committee comprises two independent non-employee directors.
GENERAL COMPENSATION PHILOSOPHY
The Company's overall compensation philosophy is to provide competitive
levels of total compensation that will enable the Company to attract,
motivate, retain and reward qualified employees. The Committee believes that
compensation should vary with the performance of the Company and any long-term
incentive should be aligned with the interest of the stockholders. The
Company's executive compensation policies are designed to provide competitive
levels of compensation to motivate officers to achieve the Company's business
objectives and to reward such officers based on their achievements. The
executive compensation program primarily consists of three main elements--Base
Salary, Incentive Bonuses and Stock Options.
Compensation for the Named Executive Officers consists of the following
components:
Base Salary: In setting compensation levels for officers, the Committee
reviews competitive information relating to compensation levels at other
disk drive companies and the information reported in the proxy statements
of those companies. Recommendations by management are examined by the
Committee in the light of this information. Officer base compensation may
vary based on time in position, assessment of individual performance,
salary relative to internal and external equity and critical nature of the
position relative to the success of the Company.
Incentive Bonuses: The incentive bonus program provides a variable
compensation opportunity for the executive officers. A payout, if any, is
based on a combination of corporate financial performance and individual
officer performance relative to achievement of the pre-established
specified strategic objectives (such as new product development milestones,
marketing/sales results, productivity enhancements and manufacturing yield
improvements). Awards under this program depend on achieving certain levels
of profitability based on after-tax net income and determined and approved
by the Board annually. Target bonuses for executive officers ranged from
twenty-five to fifty percent of base salary and actual incentive bonus
payouts paid in the last fiscal year (for previous year's performance)
ranged from twelve to twenty-seven percent of base salary of the executive
officers. The Company has a profit sharing plan in existence for employees
of the Company who do not participate in the foregoing bonus arrangements.
Since the Company posted a loss in fiscal 1996, no incentive bonuses were
awarded to the executive officers and no profit sharing payments were
awarded to the employees for 1996.
Stock Options: The Committee believes that stock ownership provides
significant incentive to employees by providing an opportunity to receive
additional compensation through building stockholder value. This
compensation element aligns the interests of employees with those of the
stockholders. The long-term incentive is realized through the granting of
stock options to employees and eligible Named Executive Officers. Stock
Options have value for the employee only if the price of the Company's
stock increases above the exercise price, which typically is set at the
fair market value of the Common Stock on the grant date. The number of
shares subject to each stock option grant is based on guidelines that take
into consideration the employee's current and anticipated future
performance and ability to promote achievement of strategic corporate goals
and anticipated future performance, as well as internal equity within the
employee's peer group. The Committee reviews Named Executive Officers'
stock option holdings annually to determine whether additional grants are
appropriate. Each stock option is generally exercisable over a four-year
period, thus providing an incentive to remain in the Company's employ.
14
<PAGE>
Other: In addition to the compensation paid to the Named Executive
Officers as described above, executive officers and all other participating
regular employees of the Company receive each year matching contributions
by the Company of up to $1,000 under the Company's 401(k) plan. In
addition, each of the Named Executive Officers receives an annual car
allowance of up to $7,200. Executive officers, subject to plan provisions,
and all other regular employees are eligible to participate in the
Company's Employee Stock Purchase Plan (which qualifies under section 423
of the Internal Revenue Code of 1986).
COMPANY PERFORMANCE AND COMPENSATION
Edwin L. Harper was named Chief Executive Officer and President of the
Company during fiscal 1996 after Syed Iftikar's resignation as the Company's
Chief Executive Officer, Chairman of the Board and President. In setting
compensation levels for the Chief Executive Officer, the Committee reviews
competitive information reflecting compensation practices for disk drive
companies and examines the Chief Executive Officer's performance relative to
overall Company financial results. The Committee also considers the Chief
Executive Officer's achievements against the same pre-established objectives
and determines whether the Chief Executive Officer's base salary, target bonus
and target total compensation approximate the competitive range of
compensation for chief executive officer positions in the disk drive industry.
While the Committee followed that process to set Mr. Iftikar's compensation
for fiscal 1996, because Mr. Harper was hired in mid-year, the Committee was
not able to measure his past performance with the Company to establish his
compensation. Instead, the Committee reviewed Mr. Harper's qualifications and
past performance and compared them with chief executive officers of other
companies.
In the fiscal year ended September 30, 1996, Mr. Iftikar received $314,765.
Mr. Iftikar did not earn an incentive bonus in fiscal year 1996. Mr. Harper's
annual base salary is $300,000. Overall, both Mr. Harper's and Mr. Iftikar's
base and incentive compensation are below the median compensation for disk
drive companies, but within the competitive range.
With respect to matters of executive compensation, stock option grants and
to all other elements of compensation, the Committee submits the foregoing
report as of January 28, 1997.
David I. Caplan
C. Richard Kramlich
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than ten percent of
a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
(the "SEC") and the National Association of Securities Dealers, Inc. Executive
officers, directors, and greater than ten percent stockholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file. The Form 3 for director Joseph Baia, who became a director in
fiscal 1996, was not filed until October 30, 1996. Based solely on its review
of the copies of such forms received by it, or written representations from
certain reporting persons, the Company believes that all of its other
executive officers and directors complied with applicable filing requirements
during the fiscal year ended September 30, 1996.
OTHER MATTERS
GENERAL
The Company knows of no other matters to be submitted to the stockholders at
the meeting. If any other matters properly come before the meeting, the
persons named in the enclosed form of Proxy intend to vote the shares they
represent in a manner consistent with the recommendations of the Board of
Directors.
15
<PAGE>
STOCKHOLDER PROPOSALS TO BE PRESENTED AT THE NEXT ANNUAL MEETING
Proposals of stockholders of the Company that are intended to be presented
by such stockholders at the Company's 1998 Annual Meeting of Stockholders must
be received by the Company no later than September 30, 1997, to be considered
for inclusion in the proxy statement and form of proxy relating to that
meeting.
BY ORDER OF THE BOARD OF DIRECTORS
Thomas C. Tokos
Secretary
Fremont, California
Dated: April 16, 1997
16
<PAGE>
P
R
O
X
Y
DETACH HERE SYQ F
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
SYQUEST TECHNOLOGY, INC.
1997 ANNUAL MEETING OF STOCKHOLDERS
The undersigned stockholder of SYQUEST TECHNOLOGY, INC., a Delaware
corporation ("Company"), hereby acknowledges receipt of the Notice of Annual
Meeting of Stockholders and Proxy Statement, each dated April 16, 1997, and
hereby appoints Edwin L. Harper and Henry C. Montgomery, or either of them,
proxies and attorneys-in-fact, with full power to each of substitution, on
behalf of and in the name of the undersigned, to represent the undersigned at
the Annual Meeting of Stockholders of SyQuest Technology, Inc. to be held on
May 6, 1997, at 9:00 a.m. local time, at the principal executive offices of
SyQuest Technology, Inc., 47071 Bayside Parkway, Fremont, California 94538, and
at any adjournment or adjournments thereof, and to vote all shares of Common
Stock which the undersigned would be entitled to vote if then and there
personally present, on the matters set forth on the reverse side.
THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO CONTRARY DIRECTION IS INDICATED,
WILL BE VOTED FOR PROPOSALS NOS. 1, 2 AND 3, AND AS SAID PROXIES DEEM ADVISABLE
ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
SEE REVERSE
SIDE
<PAGE>
DETACH HERE SYQ F
Please mark
votes as in
[X] this example.
The Board of Directors Recommends Voting FOR Proposals 1, 2 and 3.
---
<TABLE>
<CAPTION>
<S> <C> <C>
1. To elect the Company's FOR AGAINST ABSTAIN
nominees to serve as directors 2. To approve an amendment to the [_] [_] [_]
for the ensuing year and until Company's Certificate of
their successors are elected Incorporation to increase the
Nominees: Joseph Baia, Edwin L. Harper, the Company's Common Stock
C. Richard Kramlich, Edward L. Marinaro from 60,000,000 to
FOR WITHHELD 120,000,000.
[_] [_]
FOR AGAINST ABSTAIN
[_] ______________________________________ 3. To ratify the appointment of [_] [_] [_]
For all nominees except as noted above Price Waterhouse LLP as
independent auditors of the
Company for the fiscal year
ending September 30, 1997.
4. To transact such other business as may come before
the meeting or any adjournment thereof.
(This proxy should be marked, dated and signed by the stockholder(s) exactly as
his or her name appears hereon, and returned promptly in the enclosed envelope.
Persons signing in a fiduciary capacity should so indicate. If shares are held
jointly or as community property, both stockholders should sign.)
MARK HERE
FOR ADDRESS ________________________
CHANGE AND ________________________
NOTE AT RIGHT [_] ________________________
Signature ________________ Date ______ Signature _________________ Date _____
</TABLE>
