<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / 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 sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
Proxima Corporation
- --------------------------------------------------------------------------------
(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)(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
LOGO
PROXIMA CORPORATION
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
JULY 23, 1997
To The Stockholders:
NOTICE IS HEREBY GIVEN that the 1997 Annual Meeting of Stockholders of
Proxima Corporation, a Delaware corporation (the "Company"), will be held on
July 23, 1997, at 5:00 p.m. at the offices of the Company, 9440 Carroll Park
Drive, San Diego, California 92121, for the following purposes:
1. To elect directors to serve for the following year and until their
successors are duly elected;
2. To approve an amendment to the Amended and Restated 1996 Stock Plan
to increase the number of shares reserved for issuance by 1,000,000 shares;
3. To ratify the appointment of Deloitte & Touche LLP as independent
accountants of the Company for fiscal year 1998; and
4. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Stockholders of record at the close of business on June 6, 1997, are
entitled to notice of and to vote at the meeting.
All stockholders are cordially invited to attend the meeting in person.
However, to ensure your representation at the meeting, you are urged to mark,
sign, date and return the enclosed Proxy as soon as possible in the envelope
enclosed for that purpose. Any stockholder attending the meeting may vote in
person even if he or she previously returned a Proxy.
By Order of the Board of Directors
/S/ THOMAS D. KAMPFER
Thomas D. Kampfer
Secretary
San Diego, California
June 23, 1997
<PAGE> 3
PROXIMA CORPORATION
------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
JULY 23, 1997
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed Proxy is solicited on behalf of Proxima Corporation (the
"Company") for the Annual Meeting of Stockholders to be held on July 23, 1997,
at 5:00 p.m. at the offices of the Company, 9440 Carroll Park Drive, San Diego,
California 92121, or any adjournment or adjournments thereof, for the purposes
set forth herein and in the accompanying Notice of Annual Meeting.
The Company intends to mail this Proxy Statement and the related Proxy on
or about June 23, 1997, to all stockholders entitled to vote at the meeting.
In order to be consistent with the financial reports of the Company and for
ease of presentation, the Company has indicated its fiscal year as ending on
March 31, whereas the Company operates and reports on a 52-53 week fiscal year
ending on the Sunday closest to March 31.
RECORD DATE; OUTSTANDING SHARES
Only stockholders of record at the close of business on June 6, 1997, are
entitled to receive notice of and to vote at the meeting. The outstanding voting
securities of the Company as of such date consisted of 7,152,368 shares of
Common Stock.
REVOCABILITY OF PROXIES
The enclosed Proxy is revocable 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. If a person who has executed and returned a proxy is present at the
meeting and wishes to vote in person, he or she may elect to do so and thereby
suspend the power of the proxy holders to vote his or her proxy.
VOTING AND SOLICITATION
Every stockholder of record on the Record Date is entitled, for each share
held, to one vote on each proposal or item that comes before the meeting. In the
election of directors, each stockholder will be entitled to vote for six
nominees, and the six nominees with the greatest number of votes will be
elected.
The cost of this solicitation will be borne by the Company. The Company may
reimburse expenses incurred by brokerage firms and other persons representing
beneficial owners of shares in forwarding solicitation material to beneficial
owners. Proxies may be solicited by certain of the Company's directors, officers
and regular employees, without additional compensation.
QUORUM; ABSTENTIONS; BROKER NON-VOTES
The required quorum for the transaction of business at the Annual Meeting
is a majority of the shares of Common Stock issued and outstanding on the Record
Date. Shares that are voted "FOR," "AGAINST" or "WITHHELD FROM" a matter are
treated as being present at the meeting for purposes of establishing a quorum
and are also treated as shares "represented and voting" at the Annual Meeting
(the "Votes Cast") with respect to such matter.
<PAGE> 4
While there is no definitive statutory or case law authority in Delaware as
to the proper treatment of abstentions, the Company believes that abstentions
should be counted for purposes of determining both (i) the presence or absence
of the quorum for the transaction of business and (ii) the total number of Votes
Cast with respect to a proposal. In the absence of controlling precedent to the
contrary, the Company intends to treat abstentions in this manner. Accordingly,
abstentions will have the same effect as a vote against a proposal.
Broker non-votes will be counted for purposes of determining the presence
or absence of a quorum for the transaction of business, but will not be counted
for purposes of determining the number of Votes Cast with respect to a proposal.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are intended to be presented
by such stockholders at the Company's next Annual Meeting must be received by
the Company no later than February 16, 1998, in order that they may be included
in the proxy statement and form of proxy relating to that meeting.
ELECTION OF DIRECTORS
A Board of six directors is to be elected at the meeting. Unless otherwise
instructed, the proxy holders will vote all of the proxies received by them for
the Company's six nominees named below. In the event that additional persons are
nominated for election as directors, the proxy holders intend to vote all
proxies received by them in such a manner as will ensure the election of as many
of the nominees listed below as possible, and, in such event, the specific
nominees to be voted for will be determined by the proxy holders. In the event
that any of the nominees shall become unavailable, the proxy holders will vote
in their discretion for a substitute nominee. It is not expected that any
nominee will be unavailable. The term of office of each person elected as a
director will continue until the next Annual Meeting of Stockholders or until
his successor has been elected and qualified.
VOTE REQUIRED
The six nominees receiving the highest number of affirmative votes of the
shares entitled to be voted shall be elected to the Board of Directors. Votes
withheld from any director are counted for purposes of determining the presence
or absence of a quorum, but have no other legal effect under Delaware law.
Unless otherwise instructed, the proxy holders will vote the proxies
received by them for the Company's nominees named below, all of whom are
presently directors of the Company. If any nominee of the Company is unable or
declines to serve as a director at the time of the meeting, the proxies will be
voted for any nominee who is designated by the present Board of Directors to
fill the vacancy. It is not expected that any nominee will be unable or will
decline to serve as a director.
The names and certain information about the nominees for directors are set
forth below:
<TABLE>
<CAPTION>
DIRECTOR
NAME OF NOMINEE AGE POSITION/PRINCIPAL OCCUPATION SINCE
- --------------------- --- ------------------------------------------------------ --------
<S> <C> <C> <C>
Patrick Arrington 54 Partner, Brobeck, Phleger & Harrison LLP 1994
Richard E. Belluzzo 43 Executive Vice President, Computer Organization, 1995
Hewlett-Packard Company
Robert W. Johnson 47 Private Venture Capital Investor 1985
Jeffrey M. Nash 49 President, TransTech Information Management Systems, 1993
Inc.
Kenneth E. Olson 60 Chairman of the Board; Interim President and CEO 1984
John M. Seiber 62 Senior Vice President of PaineWebber, Inc. 1988
</TABLE>
Except as set forth below, each of the nominees has been engaged in the
principal occupation described above during the past five years. There is no
family relationship between any director or executive officer of the Company.
2
<PAGE> 5
Mr. Arrington has been engaged in the practice of law since 1968 and is a
member of the law firm of Brobeck, Phleger and Harrison LLP, Newport Beach,
California.
Mr. Belluzzo is the Executive Vice President, Computer Organization at
Hewlett-Packard Company. Mr. Belluzzo has held various positions at
Hewlett-Packard during the last twenty years.
Mr. Johnson has been a private venture capital investor since July 1988.
Mr. Johnson is a director of STAC Electronics, Inc. and of ViaSat, Inc.
Mr. Nash is the President of TransTech Information Management Systems,
Inc., a software development company. From June 1994 to July 1995, Mr. Nash
served as President of Digital Perceptions, Inc., a software development
company. From 1989 to June 1994, he was President of VISqUS Corporation, a
computer disk drive/magnetic recording technology development company which he
co-founded and which is a subsidiary of Conner Peripherals, a disk drive
company. Mr. Nash is a director of Remec, Inc. and of ViaSat, Inc.
Mr. Olson has served as Chairman of the Board since 1984. In March 1997,
the Board appointed him Interim President and Chief Executive Officer. Prior to
leaving the Company in 1996, he had been Chief Executive Officer from December
1990 to February 1996 and was also President of the Company from April 1995 to
February 1996. Mr. Olson is a director of LIDAK Pharmaceuticals and Applied
Digital Access, Inc.
Mr. Seiber is a Senior Vice President of PaineWebber, Inc., an investment
company. He has served in a variety of positions with PaineWebber, Inc. since
1962.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE NOMINEES
LISTED.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of June 6, 1997, certain information
with respect to the beneficial ownership of the Company's Common Stock by (i)
each person known by the Company to own beneficially more than five percent of
the outstanding shares of Common Stock, (ii) each current director of the
Company, (iii) each of the officers named in the table under "Executive
Compensation -- Summary Compensation Table" and (iv) all directors and executive
officers as a group. Except as otherwise noted, the Company knows of no
agreements among its stockholders which relate to voting or investment power of
its shares of Common Stock.
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK
BENEFICIALLY OWNED
---------------------
DIRECTORS, EXECUTIVE OFFICERS AND PERCENTAGE
FIVE PERCENT STOCKHOLDERS NUMBER OWNERSHIP
-------------------------------------------------------- ------- ---------
<S> <C> <C>
Patrick Arrington(1).................................... 11,874 *
Philip G. Baker......................................... 1,075 *
Richard E. Belluzzo(2).................................. 6,633 *
Michael H. Chaffin, Jr.................................. 282 *
Robert W. Johnson(3).................................... 22,758 *
Jeffrey M. Nash(4)...................................... 13,954 *
Kenneth E. Olson(5)..................................... 262,930 3.5
John E. Rehfeld(6)...................................... 2,075 *
John M. Seiber(7)....................................... 21,604 *
Michael S. Tamkin(8).................................... 10,710 *
Dennis A. Whittler(9)................................... 64,496 *
All directors and executive officers as a group
(14 persons)(10)...................................... 467,968 6.0
</TABLE>
- ---------------
* Less than one percent
(1) Includes 11,874 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
3
<PAGE> 6
(2) Includes 6,633 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
(3) Includes 13,498 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
(4) Includes 13,954 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
(5) Includes 60,500 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997, and 20,500 held in his name as trustee of a
charitable remainder trust and as to which shares he disclaims beneficial
ownership.
(6) Includes 1,000 shares held by his spouse, Gunvor Rehfeld, as to which
shares Mr. Rehfeld disclaims beneficial ownership.
(7) Includes 13,498 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997, and 1,000 shares held by his spouse,
Patricia Seiber, as to which shares Mr. Seiber disclaims beneficial
ownership.
(8) Includes 10,710 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
(9) Includes 38,804 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
(10) Includes 186,238 shares subject to outstanding options that are exercisable
within 60 days of June 6, 1997.
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of eight meetings during
the fiscal year ended March 31, 1997.
The Audit Committee, currently consisting of directors Arrington and
Johnson, met once during the last fiscal year. This Committee recommends
engagement of the Company's independent public accountants and is primarily
responsible for approving the services performed by such accountants and for
reviewing and evaluating the Company's accounting principles and its system of
internal accounting controls.
The Compensation Committee, currently consisting of directors Johnson, Nash
and Seiber, met once during the last fiscal year. This Committee establishes the
salary and incentive compensation of the executive officers of the Company and
administers the Company's employee benefit plans.
The Finance Committee, currently consisting of directors Seiber and Olson,
held two meetings during the last fiscal year. The Finance Committee reviews
matters concerning financing strategies and strategic alliances.
The Nominating Committee, currently consisting of directors Nash, Arrington
and Belluzzo, met once during the last fiscal year. The Nominating Committee
reviews candidates and makes recommendations for nominees to serve on the Board
of Directors. The Committee will consider recommendations by stockholders for
vacancies on the Board. Suggestions may be submitted to the Secretary of the
Company. In addition, the Committee also reviews the criteria for the position
of CEO and President and interviews the final candidates.
During fiscal year 1997, all directors attended at least 75% of the
meetings of the Board of Directors and meetings of Committees on which such
director served with the exception of Mr. Arrington, who attended 50% of the
Board meetings held.
BOARD COMPENSATION
Non-employee directors are compensated at the rate of $1,000 per meeting of
the Board of Directors and $500 per meeting of a committee that is held on a day
when a meeting of the entire Board is not held. Non-employee directors also
receive a $1,000 quarterly retainer.
4
<PAGE> 7
Subsequent to the end of fiscal 1997, the Board of Directors resolved to
compensate non-employee directors for various meetings and their retainer in the
form of Company common stock. Directors will continue to be reimbursed for
out-of-pocket expenses in connection with their attendance at meetings.
Directors may be compensated for special assignments from time to time on
an hourly, per diem or per project basis. During the period Mr. Olson was a
non-employee director, he was engaged to provide services to the Company
principally in connection with its business relationship with its affiliate,
Laser Power Corporation. He was compensated in the amount of $18,814, which is
included in the Summary Compensation Table under the heading "All Other
Compensation."
In addition, all directors are eligible to receive options to purchase
stock under the Company's Amended and Restated 1996 Stock Plan.
REPORT OF THE COMPENSATION COMMITTEE
The following is the Report of the Compensation Committee of the Company,
describing the compensation policies and rationale applicable to the Company's
officers with respect to the compensation paid to the officers for the year
ended March 31, 1997.
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for reviewing and evaluating the compensation of the Company's
officers. The duties of the Compensation Committee include reviewing and making
recommendations regarding salaries, bonuses and equity-based compensation to the
Board. All recommendations by the Committee submitted to the Board are reviewed
and approved by the non-employee directors. The Committee is composed of Messrs.
Robert Johnson, Jeffrey Nash and John Seiber, all of whom are independent,
outside directors of the Company.
- Base Salaries
The Committee establishes the base salaries of the officers by
considering the salaries of officers in similar positions at comparably
sized companies in the electronics industry using survey information
contained in the Radford Associates Management Total Compensation Report.
The Committee benchmarks salaries to the 50th percentile of the survey
range and also considers the Company's performance over the past year in
such areas as profitability and progress toward long-term goals. The base
salaries are reviewed annually.
- Annual Bonuses
The Committee establishes target bonus levels which vary between 20%
and 50% of base salary for officers. The Committee also predetermines a
minimum performance level below which no bonus is earned and the
performance goal at which the full target bonus is earned. Additional bonus
amounts are earned for achievement of results above the targets. The target
bonus is prorated for achievement of results between the minimum level and
the performance goal. For fiscal 1997, annual bonuses were based upon
earnings goals, individual goal achievements and also upon revenue goals
for certain officers who are primarily involved with selling. No
performance bonuses were paid during fiscal 1997.
- Equity-Based Compensation
The Committee views stock options as an important part of the
Company's long-term performance-based compensation plan. The Committee
bases grants of stock options to the officers upon its estimation of each
executive's potential contribution to the long-term growth and
profitability of the Company. The program is intended to provide additional
incentives to the officers to maximize stockholder value. An extensive
review of industry practices was conducted during fiscal 1997 which served
as the basis for equity-based compensation in fiscal 1997. All options are
granted at the fair market value of the Company's Common Stock at the date
of grant. The stock options vest over time to encourage key employees to
remain with the Company.
5
<PAGE> 8
- Chief Executive Officer Compensation
The compensation of the Company's Chief Executive Officer was based
upon the same criteria described above. Specifically, the Committee
considered (i) salaries of chief executive officers for comparably sized
companies in the electronics industry, (ii) the profitability goals of the
Company and the performance of similar companies, and (iii) the Company's
performance for fiscal year 1997.
Section 162(m) of the United States Internal Revenue Code of 1986 (the
"Code") limits deductibility of compensation in excess of $1 million paid to a
company's chief executive officer and four other highest paid executive officers
unless such compensation qualifies as "performance based." The Company will not
be affected by this limitation for the 1997 fiscal tax year. The Compensation
Committee intends to review this issue periodically to determine whether further
changes to the Company's compensation policies and practices are advisable in
order to preserve deductibility.
SPECIAL REPORT ON THE FISCAL YEAR 1997 REPRICING OF OPTIONS
In fiscal year 1997, the Committee determined that factors affecting the
stock price of the Company's shares made it necessary to consider a program to
reprice certain options to purchase common stock of the Company. Stock options
are intended to incentivize employees, and they form a major component of an
employee's compensation package. The Committee believes that stock options
strengthen the Company's ability to attract and retain key employees who
contribute to the Company's success. The Committee deemed it necessary to
reprice specific outstanding stock options held by employees, including the
Company's executive officers. Prior to this action, the Company's stock price
had been depressed. In order to retain key employees, the Committee concluded it
was important that out-of-the-money options be repriced to reflect the current
market value. Option grants to directors were not eligible for participation in
this program.
After consideration and upon recommendation of the Compensation Committee,
on July 10, 1996, the Board of Directors approved the repricing of all
outstanding options for non-officer employees and directed management to convey
the information to the employees. A repricing program was implemented and
communicated to the affected employees. Under the program, non-officer employees
holding outstanding options with an exercise price higher than the closing price
of a share of Proxima Corporation common stock on the repricing date of August
14, 1996 were eligible to participate in the repricing program. Each optionee
holding an out-of-the-money option was offered the opportunity to either retain
the existing option or to accept a repricing of the affected option at an
exercise price of $11.50. No change was made in the number of options granted,
but employees who accepted the repricing offer agreed to a new vesting schedule.
Under the new vesting schedule options vest over a period of four years at the
rate of 25% per annum commencing on the first anniversary of the date of the
repricing.
On September 25, 1996, the Board of Directors approved the repricing of all
options held by officers with prices exceeding the closing price of Proxima
Corporation common stock on September 26, 1996. Such closing price was $12.00.
The program for officers was consistent with that offered to the general
employees with the exception of the exercise price which was governed by the
market price of the stock at the repricing date specified in the Board
resolution.
The Committee and the Board of Directors believe that with the repricing
program, employees will continue to view their options as a valuable part of
their total compensation. The Company believes that this will aid it in
retaining critical employees. It will, however, be necessary for the employees
who elected to participate in the repricing program to continue employment with
the Company for another four years in order to receive the maximum benefit from
the repriced options, and then only if the market value of the stock rises above
the stated option price.
Following the close of the fiscal year, and as the price of the common
stock continued to decrease, the Committee again reviewed the value of the
outstanding stock options and recommended a second repricing program. On April
24, 1997, the Board approved this second repricing program for all employees and
executive officers. All employees have the opportunity to accept a lower
exercise price in exchange for the commencement of a new vesting period, so that
only employees remaining with the Company for a minimum
6
<PAGE> 9
of four years would have an opportunity to take full advantage of the repricing
program. The amended price of the options is $5.19, but at this date, the
repricing program has not been completed.
COMPENSATION COMMITTEE:
Robert W. Johnson, Chairman
Jeffrey M. Nash, Committee Member
John M. Seiber, Committee Member
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee was or is an officer or employee of
the Company or any of its subsidiaries.
7
<PAGE> 10
PERFORMANCE GRAPH
The following is a graph comparing the cumulative total return to
stockholders of the Company's Common Stock to two indices: (i) the Nasdaq Stock
Market (U.S. Companies) Index and (ii) the Nasdaq Computer Manufacturers Stock
Index. Information contained in the Performance Graph shall not be deemed to be
"soliciting material" or to be "filed" with the Securities and Exchange
Commission, nor shall such information be incorporated by reference into any
future filing under the Securities Act or the Exchange Act, except to the extent
that the Company specifically incorporates it by reference into such filing.
COMPARISON OF 50-MONTH CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
NASDAQ STOCK
MEASUREMENT PERIOD PROXIMA MARKET-U.S. NASDAQ COMPUTER
(FISCAL YEAR COVERED) CORPORATION COMPANIES MANUFACTURERS
<S> <C> <C> <C>
FEB-93 $100 100 100
MAR-93 94 98 90
MAR-94 70 106 87
MAR-95 199 118 104
MAR-96 147 161 161
MAR-97 43 186 192
</TABLE>
The Performance Graph shows the cumulative total return on investment
assuming an investment of $100 on February 4, 1993, in the Company, the Nasdaq
Stock Market (U.S. Companies) Index and the Nasdaq Computer Manufacturers Stock
Index. The return on investment includes the reinvestment of dividends, although
dividends have never been paid on Company stock.
8
<PAGE> 11
EXECUTIVE COMPENSATION
Summary Compensation Table. The following table sets forth the compensation
paid by the Company for the year ended March 31, 1997, to any person acting as
the Chief Executive Officer and each of the other four most highly compensated
executive officers of the Company.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------
SECURITIES
ANNUAL COMPENSATION UNDERLYING ALL OTHER
FISCAL ------------------------ OPTION COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) AWARDS (#) ($)(1)
- ---------------------------------- ------ ---------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Philip G. Baker................... 1997 160,000 50,000 47,000(3) 36,314
Vice President, Product 1996(2) 31,597 15,000 40,000 30,422
Development 1995 -- -- -- --
Michael H. Chaffin, Jr. .......... 1997 207,392 -- 67,500(3) 14,450
Executive Vice President, 1996(2) 115,822 -- 60,000 37,895
Business Development 1995 -- -- -- --
Kenneth E. Olson.................. 1997(2) 54,221 6,160 2,500 95,040
Interim President and CEO; 1996 221,538 -- -- 17,278
Chairman of Board 1995 220,000 220,000 37,000 13,865
John E. Rehfeld................... 1997(2) 311,312 75,000 215,000(3) 580,937
Former President and CEO 1996(2) 55,386 25,000 200,000 3,068
1995 -- -- -- --
Michael S. Tamkin................. 1997 161,000 -- 26,000(3) 8,301
Vice President, Manufacturing 1996 155,000 -- 20,000 5,833
1995(2) 136,635 68,345 30,000 52,617
Dennis A. Whittler................ 1997 158,461 3,060 15,500(3) 6,322
Vice President, Finance; 1996 149,000 -- -- 5,041
Chief Financial Officer 1995 129,000 81,041 10,000 4,962
</TABLE>
- ---------------
(1) Includes for fiscal year 1997: Key executive insurance premiums
(Baker -- $255; Chaffin -- $670; Olson -- $2,670; Rehfeld -- $3,958;
Tamkin -- $818; Whittler -- $191); Matching contributions to Company's
401(k) plan (Baker -- $7,177; Chaffin -- $5,128; Olson -- $3,661;
Rehfeld -- $10,313; Tamkin -- $5,151; Whittler -- $6,131); Relocation
expenses (Baker -- $28,587; Chaffin -- $2,352; Rehfeld -- $257,066); Change
in status or termination payments (Olson -- $60,000; Rehfeld -- $300,000);
Automobile allowances (Chaffin -- $6,300; Olson -- $1,255;
Rehfeld -- $9,600; Tamkin -- $2,332); Amounts as a non-employee director
(Olson -- $18,814 consulting fees and $8,640 director's fees).
(2) Employed for a portion of the fiscal year.
(3) See also "Special Report on the Fiscal Year 1997 Repricing of Options" and
"Information Regarding Repricing, Cancellation or Regrant of Options."
9
<PAGE> 12
Option Grants in Last Fiscal Year. The following table sets forth each
grant of stock options made during the fiscal year ended March 31, 1997, to each
of the executive officers named in the Summary Compensation Table :
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------
% OF TOTAL POTENTIAL
OPTIONS REALIZABLE VALUE AT
SECURITIES GRANTED TO ASSUMED ANNUAL RATES OF
UNDERLYING EMPLOYEES EXERCISE STOCK PRICE APPRECIATION
OPTIONS IN FISCAL OR BASE EXPIRATION FOR OPTION TERM (1)
NAME GRANTED(#) YEAR PRICE DATE 5% 10%
- -------------------------------- ---------- ---------- -------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Philip G. Baker................. 7,000 2.0 $11.50 8-14-03 $ 32,772 $ 76,372
40,000 (2) 12.00 9-25-03 195,408 455,384
Michael H. Chaffin, Jr.......... 7,500 2.2 11.50 8-14-03 35,112 81,827
60,000 (2) 12.00 9-25-03 283,112 683,076
Kenneth E. Olson................ 2,500 .7 11.50 8-14-03 11,704 27,276
John E. Rehfeld................. 15,000 4.4 11.50 8-14-03 70,225 163,654
200,000 (2) 12.00 9-25-03 977,041 2,276,921
Michael S. Tamkin............... 6,000 1.7 11.50 8-14-03 28,090 65,461
20,000 (2) 12.00 9-25-03 97,704 227,692
Dennis A. Whittler.............. 5,500 1.6 11.50 8-14-03 25,749 60,006
10,000 (2) 12.00 9-25-03 48,852 113,846
</TABLE>
- ---------------
(1) Potential realizable value is based on an assumption that the stock price
appreciates at the annual rate shown (compounded annually) from the date of
grant until the end of the seven year option term. These numbers are
calculated based on the requirements promulgated by the Securities and
Exchange Commission and do not reflect the Company's estimate of future
stock price growth.
(2) These options were repriced during fiscal 1997, but were granted in prior
years and, therefore, are not included in the calculations for this column.
Aggregate Option Exercises in Last Fiscal Year and Fiscal Year-End
Values. This table sets forth, for each of the executive officers named in the
Summary Compensation Table, each exercise of stock options during the fiscal
year ended March 31, 1997, and the year-end value of unexercised options:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED ON VALUE OPTIONS AT YEAR-END: AT YEAR-END:
NAME EXERCISE(#) REALIZED(1) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(2)
- ------------------------ ----------- ----------- ---------------------------- -------------------------------
<S> <C> <C> <C> <C> <C> <C>
Philip G. Baker......... -- -- 0 47,000 -- --
Michael H. Chaffin,
Jr.................... -- -- 0 67,500 -- --
John E. Rehfeld......... -- -- 0 215,000 -- --
Kenneth E. Olson........ 176,414 $ 1,282,481 500 2,000 -- --
Michael S. Tamkin....... -- -- 8,589 38,411 -- --
Dennis A. Whittler...... -- -- 37,037 23,462 -- --
</TABLE>
- ---------------
(1) Market value of underlying securities minus exercise price at time of
exercise.
(2) None of these options are in-the-money.
INFORMATION REGARDING REPRICING, CANCELLATION OR REGRANT OF OPTIONS
As set out above in the Special Report on Fiscal 1997 Repricing of Options,
the Company implemented an option repricing program for executive officers and
other employees holding out-of-the-money options. The repricing was effective
August 14, 1996 as to employees and September 26, 1996 as to executive officers.
At the employee's election, each option was repriced to the fair market value of
the common stock pursuant to the criteria established in the Board's resolutions
($11.50 on August 14, 1996 for employees and $12.00 on
10
<PAGE> 13
September 26, 1996 for executive officers) and became subject to a new vesting
schedule. The April 24, 1997 repricing program has not been completed at this
time.
The following table sets forth (i) information with respect to each of the
Company's Named Executive Officers who participated in the option repricing
program effected September 26, 1996, and (ii) information with respect to all
former or current executive officers of the Company concerning their
participation in any option repricing programs implemented by the Company during
the last ten fiscal years.
<TABLE>
<CAPTION>
NUMBER OF MARKET PRICE EXERCISE LENGTH OF
SECURITIES OF STOCK AT PRICE AT ORIGINAL OPTION
UNDERLYING TIME OF TIME OF TERM REMAINING
OPTIONS/SARS REPRICING OR REPRICING NEW AT DATE OF
REPRICED OR AMEND- OR AMEND- EXERCISE REPRICING OR
NAME AND POSITION DATE AMENDED(#) MENT($) MENT($) PRICE($) AMENDMENT
- ---------------------------------- ------- ------------ ------------ --------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Philip Baker...................... 9-26-96 40,000 12.00 20.75 12.00 76 of 84 months
Vice President, Product
Development
Michael H. Chaffin, Jr............ 9-26-96 60,000 12.00 18.63 12.00 71 of 84 months
Executive Vice President, Business
Development
Charles Chestnutt................. 9-26-96 10,000 12.00 25.875 12.00 66 of 84 months
Former Vice President and
Controller
Frank Drdek....................... 9-26-96 10,000 12.00 25.875 12.00 66 of 84 months
Vice President, Human Resources
Donald Houston.................... 9-26-96 30,000 12.00 25.875 12.00 66 of 84 months
Former Vice President, 10,000 12.00 19.75 12.00 71 of 84 months
Sales
John Rehfeld...................... 9-26-96 200,000 12.00 20.75 12.00 76 of 84 months
Former President and CEO
Michael Tamkin.................... 9-26-96 10,000 12.00 35.875 12.00 62 of 84 months
Vice President, Manufacturing 10,000 12.00 25.875 12.00 66 of 84 months
Dennis Whittler................... 9-26-96 10,000 12.00 25.875 12.00 66 of 84 months
Vice President, Finance, CFO
</TABLE>
At the present time, the fiscal year 1997 repricing of officers' options
affects a total of 40,000 options.
EMPLOYMENT AND/OR TERMINATION AGREEMENTS
On March 26, 1997, John E. Rehfeld resigned as President, CEO and Director.
Under the terms of his employment agreement, at his termination, he is entitled
to receive twelve months salary at his then current compensation rate, i.e.
$300,000 per annum, payable in biweekly installments. This amount is included in
the Summary Compensation Table.
Subsequent to the end of the fiscal year, Philip G. Baker, Vice President,
Product Development resigned his employment. Under an Employment Release
Agreement executed May 10, 1997, Mr. Baker will receive a salary continuation
benefit of $160,000 payable in biweekly installments over a twelve month period.
Subsequent to the end of the fiscal year, Michael H. Chaffin, Jr.,
Executive Vice President, Business Development, resigned his employment. Under a
Change in Status and General Release Agreement executed December 20, 1996, Mr.
Chaffin will receive a salary continuation benefit of $86,667 payable in
biweekly installments over a six month period.
LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS
The Company's Bylaws provide that the Company is required to indemnify its
officers and directors to the maximum extent and in the manner permitted by
Delaware law. Further, the Company has entered into indemnification agreements
with its officers and directors. The Company believes that its charter and bylaw
provisions and indemnification agreements are necessary to attract and retain
qualified persons as directors and officers.
11
<PAGE> 14
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act), requires the Company's 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 on Form 3 and changes in ownership on
Form 4 or Form 5 with the Securities and Exchange Commission (the "SEC"). Such
officers, directors and ten percent stockholders are also required by SEC rules
to furnish the Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, the
Company believes that, during the fiscal year ended March 31, 1997, all Section
16(a) filing requirements applicable to its officers, directors and ten percent
stockholders were complied with except for one former officer, Donald Houston,
who filed a late Form 4 regarding one open market purchase in May 1996.
AMENDMENT OF THE 1996 STOCK PLAN
BACKGROUND
The 1996 Stock Plan was adopted by the Board of Directors and approved by
the stockholders in 1996, and it was subsequently amended and restated by the
Board in order to take advantage of the revision of Section 16 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Without giving effect to
the amendment described below, a total of 500,000 shares of Common Stock, par
value $.001, has been reserved for issuance, as well as up to an additional
500,000 shares to the extent that outstanding options previously granted under
the expired Amended and Restated 1986 Stock Option Plan (the "1986 Plan") are
not exercised prior to their expiration.
The Board of Directors has approved an amendment to the 1996 Plan to
increase the number of shares reserved for issuance thereunder by 1,000,000,
bringing the total number of shares reserved for issuance to 1,500,000, together
with up to an additional 500,000 shares of Common Stock to the extent that
outstanding options previously granted under the 1986 Plan expire unexercised.
The Company is currently engaged in a nationwide search for a new CEO. The
Company anticipates that it will grant a significant number of stock options in
connection with the hire of an individual to fill this position.
As of March 31, 1997, approximately 731,000 shares were subject to
outstanding options under both the 1986 Plan and the 1996 Plan at prices ranging
from $.19 to $36.88. The closing price of a share of Proxima Corporation Common
Stock on June 1, 1997, was $4.81.
VOTE REQUIRED
The affirmative vote of a majority of the shares of the Votes Cast will be
required to approve the Plan and reserve shares thereunder. Votes that are cast
against the proposal are counted for the purposes of determining the total
number of Voting Shares with respect to this proposal. The Board of Directors
recommends that stockholders vote "FOR" the adoption of the amendment to the
1996 Plan.
DESCRIPTION OF THE AMENDED AND RESTATED 1996 STOCK PLAN
General. The 1996 Plan provides for the discretionary grant of options and
stock purchase rights ("Rights") to employees and directors of and consultants
to the Company. Options granted under the Plan may be either "incentive stock
options," as defined in Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), or nonstatutory stock options.
Purpose. The purpose of the 1996 Plan is to attract and retain the best
available personnel for positions of substantial responsibility with the
Company, to provide additional incentive to the employees, directors and
consultants of the Company and to promote the success of the Company's business.
12
<PAGE> 15
Administration. The 1996 Plan may generally be administered by the Board or
a Committee appointed by the Board. However, with respect to grants of options
and Rights to employees who are also officers or directors of the Company
("Insiders"), if the Company wishes to qualify such transactions as exempt under
Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended, or
any successor rule thereto ("Rule 16b-3"), the transactions shall be structured
to satisfy the Rule 16b-3 exemption requirements, including, if necessary or
appropriate, approvals of the transactions by the entire Board or by a committee
consisting solely of two or more "nonemployee directors," as defined in Rule
16b-3. Also, to the extent that the Company wishes to qualify option grants as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a committee of two or more "outside
directors" within the meaning of Section 162(m). The administrators of the 1996
Plan are referred to herein as the "Administrator."
Eligibility; Limitations. Nonstatutory stock options and Rights may be
granted under the 1996 Plan to employees, directors and consultants of the
Company and any parent or subsidiary of the Company. Incentive stock options may
be granted only to employees. The Administrator, in its discretion, selects the
employees, directors and consultants to whom options and Rights may be granted,
the time or times at which such awards may be exercised, and the number of
shares subject to each such award. To the extent that the aggregate fair market
value of shares with respect to which Incentive Stock Options are exercisable
for the first time by an optionee in a calendar year under all Company plans
exceeds $100,000, such options shall be treated as nonstatutory options.
Section 162(m) of the Code limits the deductibility of compensation paid to
certain executive officers of the Company. To maximize the Company's deduction
attributable to options granted to such persons, the 1996 Plan provides that no
employee may be granted, in any fiscal year of the Company, options or Rights to
purchase more than 200,000 shares of Common Stock, except that in connection
with an employee's initial employment, he or she may be granted options or
Rights to purchase up to an additional 400,000 shares of Common Stock.
Terms and Conditions of Options. Each option is evidenced by a stock option
agreement between the Company and the optionee, and is subject to the following
additional terms and conditions:
(a) Exercise Price. The Administrator determines the exercise price of
options at the time the options are granted and may also reduce the
exercise price of any option or Right if the fair market value of the
Common Stock covered should decline after the initial grant. The
Administrator may also institute an option exchange program, whereby
outstanding options are exchanged for options with a lower exercise price.
The exercise price of an incentive stock option may not be less than 100%
of the fair market value of the Common Stock on the date such option is
granted; provided, however, that the exercise price of an incentive stock
option granted to a more than 10% stockholder may not be less than 110% of
the fair market value of the Common Stock on the date such option is
granted. The exercise price of a nonstatutory stock option shall be
determined by the Administrator, but if such option is intended to qualify
as "performance-based compensation" within the meaning of Section 162(m) of
the Code; it must be no less than 100% of the fair market value of the date
of grant. The fair market value of the Common Stock is generally determined
with reference to the closing sale price for the Common Stock on the last
market trading day before the date the option is granted.
(b) Exercise of Option; Form of Consideration. The Administrator
determines when options become exercisable and may, in its discretion,
accelerate the vesting of any outstanding option or extend the
post-termination exercise period for options beyond what the Plan otherwise
provides. Stock options granted under the 1996 Plan generally vest and
become exercisable over forty-eight (48) months. Vesting is tolled during
unpaid leaves of absence unless the administrator provides otherwise. The
means of payment for shares issued upon exercise of an option is specified
in each option agreement. The 1996 Plan permits payment to be made by cash,
check, promissory note, other shares of Common Stock (with some
restrictions), cashless exercise, a reduction in the amount of any Company
liability to the optionee, any other form of consideration permitted by
applicable law, or any combination thereof.
13
<PAGE> 16
(c) Term of Option. The term of an incentive stock option may be no
more than ten (10) years from the date of grant. An Incentive Stock Option
granted to a more than 10% stockholder may have a term of no more than five
(5) years from the date of grant. No option may be exercised after the
expiration of its term.
(d) Termination of Employment. If an optionee's employment
relationship, directorship or consulting relationship terminates for any
reason other than death or disability, the optionee may exercise any Plan
options that have vested by the termination date within such time as is set
forth in the Notice of Grant or, if no time is so specified, for three
months following the termination. For Incentive Stock Options, the exercise
period may not exceed three months from the termination date. An optionee's
change in status between consultant, employee and director shall not be
considered termination, but an Incentive Stock Option shall be treated for
tax purposes as a nonstatutory stock option three months and one day after
an optionee stops being an employee.
(e) Death or Disability. If an optionee's employment relationship,
directorship or consulting relationship terminates as a result of death or
disability, then all options held by such optionee under the 1996 Plan
expire on the earlier of (i) 12 months from the date of such termination or
(ii) the expiration date of such option in the Notice of Grant. The
optionee (or the optionee's estate or the person who acquires the right to
exercise the option by bequest or inheritance) may exercise all or part of
the option at any time before such expiration to the extent that the option
was exercisable at the time of such termination.
(f) Nontransferability of Options. Options granted under the 1996 Plan are
not transferable other than by will or the laws of descent and distribution, and
may be exercised during the optionee's lifetime only by the optionee.
(g) Offer to Purchase. The Administrator may offer to buy an optionee's
option for cash or shares on terms determined by the Administrator.
(h) Other Provisions. The stock option agreement may contain such other
terms, provisions and conditions not inconsistent with the 1996 Plan as the
Administrator may determine.
Stock Purchase Rights. A stock purchase right gives the purchaser a period
of no longer than six (6) months from the date of grant to purchase Common
Stock. A stock purchase right is accepted by the execution of a restricted stock
purchase agreement between the Company and the purchaser, accompanied by the
payment of the purchase price for the shares. Unless the Administrator
determines otherwise, the restricted stock purchase agreement shall give the
Company a repurchase option exercisable upon the voluntary or involuntary
termination of the purchaser's employment relationship, directorship or
consulting relationship with the Company for any reason (including death and
disability). The purchase price for any shares repurchased by the Company shall
be the original price paid by the purchaser. The repurchase option lapses at a
rate determined by the Administrator. A stock purchase right is nontransferable
other than by will or the laws of descent and distribution, and may be exercised
during the Right holder's lifetime only by the Right holder.
Adjustments Upon Changes in Capitalization. If the stock of the Company
changes by reason of any stock split, reverse stock split, stock dividend,
combination, reclassification or other increase or decrease in the number of
issued shares of Common Stock effected without the receipt of consideration,
appropriate adjustments shall be made in the number of shares of stock subject
to the 1996 Plan, the number of unissued or returned Plan shares and shares
subject to any option or Right outstanding under the 1996 Plan, and the exercise
price of any such outstanding award.
In the event of a liquidation or dissolution, any unexercised options or
Rights will terminate. The Administrator may, in its discretion, provide that
each optionee shall have the right to exercise all of the optionee's options,
including those not otherwise exercisable, and may provide that any Company
repurchase right lapses if the proposed liquidation or dissolution takes place
as contemplated.
14
<PAGE> 17
In connection with any merger or sale of substantially all the assets of
the Company, each outstanding option or Right shall be assumed or an equivalent
option or right shall be substituted by the successor corporation. If the
successor corporation refuses to assume the options and Rights or to substitute
substantially equivalent awards, the optionee or Right holder shall be entitled
to exercise the option or Right in full, including as to shares not otherwise
exercisable. In such event, the Administrator shall notify the optionee or Right
holder that the option or Right is fully exercisable for fifteen (15) days from
the date of such notice and that the option or Right terminates upon expiration
of such period.
Amendment and Termination. The Board may amend, alter, suspend or terminate
the 1996 Plan at any time. However, the Company shall obtain stockholder
approval for any amendment to the 1996 Plan to the extent necessary or desirable
to comply with Rule 16b-3 or Section 422 of the Code, or any successor rule or
statute or other applicable law, including requirements of an exchange or
quotation system. No such action by the Board or stockholders may alter or
impair any option or Right previously granted under the 1996 Plan without the
written consent of the optionee or Right holder. Unless terminated earlier, the
1996 Plan shall terminate ten years from the date of its approval.
FEDERAL INCOME TAX CONSEQUENCES FOR THE 1996 PLAN
Incentive Stock Options. An optionee who is granted an Incentive Stock
Option does not recognize taxable income at the time the option is granted or
upon its exercise, although the exercise may subject the optionee to the
alternative minimum tax. Upon a disposition of the shares more than two years
after grant of the option and one year after exercise of the option, any gain or
loss is treated as long-term capital gain or loss. If these holding periods are
not satisfied, the optionee recognizes ordinary income at the time of
disposition equal to the lesser of (A) the difference between the fair market
value of the shares at the date of the option exercise and the aggregate
exercise price, and (B) the difference between the sale price of the shares and
the aggregate exercise price. A different rule for measuring ordinary income
upon such a premature disposition may apply if the optionee is also an officer,
director, or a more than 10% stockholder of the Company. The Company is entitled
to a deduction in the same amount as the ordinary income recognized by the
optionee.
Nonstatutory Stock Options. An optionee does not recognize any taxable
income at the time of a grant of a nonstatutory stock option. Upon exercise, the
optionee recognizes taxable income generally measured by the excess of the then
fair market value of the shares over the aggregate exercise price. Any taxable
income recognized in connection with an option exercise by an employee or former
employee of the Company is subject to tax withholding by the Company. The
Company is entitled to a deduction in the same amount as the ordinary income
recognized by the optionee.
Stock Purchase Rights. Stock purchase rights will generally be taxed in the
same manner as nonstatutory stock options. However, restricted stock is
generally purchased upon the exercise of a stock purchase right. At the time of
purchase, restricted stock is subject to a "substantial risk of forfeiture"
within the meaning of Section 83 of the Code. As a result, the purchaser will
not recognize ordinary income at the time of purchase. Instead, the purchaser
will recognize ordinary income on the dates when a stock ceases to be subject to
a substantial risk of forfeiture. The stock will generally cease to be subject
to a substantial risk of forfeiture when it is no longer subject to the
Company's right to repurchase the stock upon the purchaser's termination of the
employment relationship, directorship or consulting relationship with the
Company. At such times, the purchaser will recognize ordinary income measured as
the difference between the purchase price and the fair market value of the stock
on the date the stock is no longer subject to a substantial risk of forfeiture.
The purchaser may accelerate to the date of purchase the recognition of
ordinary income, if any, and the beginning of any capital gain holding period by
timely filing an election pursuant to Section 83(b) of the Code. In such event,
the ordinary income recognized, if any, is measured as the difference between
the purchase price and the fair market value of the stock on the date of
purchase, and the capital gain holding period commences on such date. The
ordinary income recognized by a purchaser who is an employee or former employee
will be subject to tax withholding by the Company. Different rules may apply if
the purchaser is also an officer, director, or a more than 10% stockholder of
the Company.
15
<PAGE> 18
THE FOREGOING IS ONLY A SUMMARY OF THE EFFECT OF FEDERAL INCOME TAXATION
UPON OPTIONEES, HOLDERS OF STOCK PURCHASE RIGHTS, AND THE COMPANY WITH RESPECT
TO THE GRANT AND EXERCISE OF OPTIONS AND STOCK PURCHASE RIGHTS UNDER THE 1996
PLAN. IT DOES NOT PURPORT TO BE COMPLETE AND DOES NOT DISCUSS THE TAX
CONSEQUENCES OF AN EMPLOYEE'S, DIRECTOR'S OR CONSULTANT'S DEATH OR THE
PROVISIONS OF THE INCOME TAX LAWS OF ANY MUNICIPALITY, STATE OR FOREIGN COUNTRY
IN WHICH THE EMPLOYEE, DIRECTOR OR CONSULTANT MAY RESIDE.
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Deloitte & Touche LLP, independent
accountants, to audit the books, records and accounts of the Company for fiscal
year 1998. Deloitte & Touche has audited the Company's financial statements
since fiscal 1983.
The affirmative vote of the holders of a majority of the Company's Common
Stock represented and voting at the meeting will be required to approve and
ratify the Board's selection of Deloitte & Touche. The Board of Directors
recommends voting "FOR" approval and ratification of such selection. In the
event of a negative vote on such ratification, the Board of Directors will
reconsider its selection.
A representative of Deloitte & Touche is expected to be available at the
Annual Meeting to make a statement if such representative desires to do so and
to respond to appropriate questions.
OTHER MATTERS
Management does not intend to bring before the meeting any matters other
than those set forth herein, and has no present knowledge that any other matters
will or may be brought before the meeting by others. However, if any other
matters properly come before the meeting, it is the intention of the persons
named in the enclosed form of Proxy to vote the Proxies in accordance with their
judgment.
The Company has borne the cost of preparing, assembling and mailing this
proxy solicitation material.
By Order of the Board of Directors
/S/ THOMAS D. KAMPFER
Thomas D. Kampfer
Secretary
16
<PAGE> 19
PROXIMA CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
1997 ANNUAL MEETING OF STOCKHOLDERS -- JULY 23, 1997
The undersigned stockholder(s) of Proxima Corporation, a Delaware
corporation, hereby appoints Kenneth E. Olson and Dennis A. Whittler, jointly or
individually, as proxies with full power to each of substitution, to represent
the undersigned at the Annual Meeting of Stockholders of Proxima Corporation to
be held July 23, 1997, at 5:00 p.m., local time, at the offices of the
corporation, 9440 Carroll Park Drive, San Diego, California 92121 and any
adjournments thereof, and to vote all shares of Common Stock which the
undersigned is entitled to vote on the matters set forth below:
(CONTINUED, AND TO BE MARKED, DATED AND SIGNED, ON THE REVERSE SIDE)
<PAGE> 20
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3
WITHHOLD
FOR FOR ALL
1. Election of Directors [ ] [ ]
To withhold authority to vote for any individual
nominee, strike through the nominee's name below.
Nominees:
Patrick Arrington
Richard E. Belluzzo
Robert W. Johnson
Jeffrey M. Nash
Kenneth E. Olson
John M. Seiber
FOR AGAINST ABSTAIN
2. Approve the Amendment to the [ ] [ ] [ ]
Amended and Restated 1996 Stock
Plan to increase the number of
shares reserved for issuance thereunder
3. Ratify the appointment of [ ] [ ] [ ]
Deloitte & Touche LLP as
independent accountants
for the ensuing year
Signature(s)_________________________________________________Date:______________
Please sign as name appears hereon. Joint owners should each sign. If signing
as attorney, executor, administrator, trustee or guardian, please give full
title.
(ARROW UP) FOLD AND DETACH HERE (ARROW UP)
