<PAGE>
ASECO CORPORATION
500 DONALD LYNCH BOULEVARD
MARLBORO, MASSACHUSETTS 01752
July 2, 1997
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Aseco Corporation (the "Company"), which will be held on Wednesday, August 6,
1997 at 10:00 A.M., at the offices of Choate, Hall & Stewart, 36th Floor,
Exchange Place, 53 State Street, Boston, Massachusetts.
The following Notice of Annual Meeting of Stockholders and Proxy Statement
describe the items to be considered by the stockholders and contain certain
information about the Company and its officers and directors.
Please sign and return the enclosed proxy card as soon as possible in the
envelope provided so that your shares can be voted at the meeting in
accordance with your instructions. Even if you plan to attend the meeting, you
are urged to sign and promptly return the proxy card. You can revoke it at any
time before it is exercised at the meeting, or vote your shares personally if
you attend the meeting.
We look forward to seeing you.
Sincerely,
/s/ Carl S. Archer, Jr.
Carl S. Archer, Jr.
President, Chief Executive Officer
and Chairman of the Board
<PAGE>
ASECO CORPORATION
500 DONALD LYNCH BOULEVARD MARLBORO, MASSACHUSETTS 01752
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON AUGUST 6, 1997
The Annual Meeting of Stockholders of Aseco Corporation (the "Company") will
be held at the offices of Choate, Hall & Stewart, 36th Floor, Exchange Place,
53 State Street, Boston, Massachusetts on Wednesday, August 6, 1997 at 10:00
A.M., for the following purposes:
1. To elect two directors for a three-year term.
2. To ratify the Board of Directors' selection of Ernst & Young LLP as
the Company's independent auditors for the fiscal year ending March 29,
1998.
3. To transact such other business as may properly come before the
meeting, and any or all adjournments thereof.
Stockholders of record at the close of business on June 25, 1997 will be
entitled to notice of and to vote at the Annual Meeting and any adjournments
thereof.
By Order of the Board of Directors
Robert V. Jahrling
Secretary
Dated: July 2, 1997
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED RETURN ENVELOPE
IN ORDER THAT YOUR SHARES MAY BE REPRESENTED.
<PAGE>
ASECO CORPORATION
500 DONALD LYNCH BOULEVARD
MARLBORO, MASSACHUSETTS 01752
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished to the holders of common stock of Aseco
Corporation (the "Company") in connection with the solicitation of proxies to
be voted at the Annual Meeting of Stockholders to be held on August 6, 1997
and at any adjournment of that meeting. The enclosed proxy is solicited on
behalf of the Board of Directors of the Company. Each properly signed proxy
will be voted in accordance with the instructions contained therein, and, if
no choice is specified, the proxy will be voted in favor of the proposals set
forth in the Notice of Annual Meeting.
A person giving the enclosed proxy has the power to revoke it, at any time
before it is exercised at the meeting, by written notice to the Secretary of
the Company, by sending a later dated proxy, or by revoking it in person at
the meeting.
The approximate date on which this Proxy Statement and the enclosed proxy
will first be sent to stockholders is July 2, 1997. The Company's Annual
Report to Stockholders for the year ended March 30, 1997 is being mailed
together with this Proxy Statement.
Only holders of common stock of record on the stock transfer books of the
Company at the close of business on June 25, 1997 (the "record date") will be
entitled to vote at the meeting. There were 3,672,017 shares of common stock
outstanding and entitled to vote on the record date.
Each share of common stock is entitled to one vote. The affirmative vote of
the holders of a plurality of the shares represented at the meeting, at which
a quorum is present, is required for the election of directors. Approval of
the other matters which are before the meeting will require the affirmative
vote at the meeting, at which a quorum is present, of the holders of a
majority of votes cast with respect to such matters.
For purposes of the matters before the Annual Meeting, under the Company's
By-Laws, a quorum consists of a majority of the issued and outstanding shares
entitled to vote on such matters as of the record date. Shares voted to
abstain or to withhold as to a particular matter and shares as to which a
nominee (such as a broker holding shares in street name for a beneficial
owner) has no voting authority in respect of such matter will be deemed
represented for quorum purposes. Under the Company's By-Laws, such shares will
not be deemed to be voting on such matters, and therefore will not be the
equivalent of negative votes as to such matters. Votes will be tabulated by
the Company's transfer agent subject to the supervision of persons designated
by the Board of Directors as inspectors.
<PAGE>
STOCK OWNERSHIP OF DIRECTORS, NOMINEES, EXECUTIVE OFFICERS
AND PRINCIPAL STOCKHOLDERS
The following table sets forth certain information regarding beneficial
ownership of the Company's common stock as of May 31, 1997 by (a) each
director of the Company and nominee for director, (b) each of the executive
officers named in the Summary Compensation Table below, (c) all current
directors and executive officers as a group and (d) each person known to the
Company to own beneficially 5% or more of the Company's common stock. Except
as otherwise indicated, each person has sole investment and voting power with
respect to the shares shown as being beneficially owned by such person, based
on information provided by such owners.
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIALLY PERCENT OF
NAME OWNED(1) OUTSTANDING SHARES(2)
- ---- ------------ ---------------------
<S> <C> <C>
Carl S. Archer, Jr.......................... 247,815 6.45%
Sebastian J. Sicari......................... 186,455 4.90
C. Kenneth Gray............................. 61,092 1.64
Sheldon Buckler............................. 8,250 *
Sheldon Weinig.............................. 8,250 *
Gerald L. Wilson............................ -- --
Kopp Investment Advisers, Inc.(3)(4)........ 666,950 18.16
6600 France Avenue South
Edina, MN 55435
All current directors and executive officers
as a group (9 persons)..................... 525,564 12.97
</TABLE>
- --------
* Less than 1%
(1) Includes 381,043 shares which may be acquired by exercise of stock options
as of or within sixty days after May 31, 1997 by the current directors and
executive officers as a group and individually as follows: Mr. Archer,
167,146; Mr. Sicari, 130,533; Mr. Gray, 59,051; Dr. Buckler, 4,250; Dr.
Weinig, 7,250; and other current executive officers, 12,813.
(2) The number of shares deemed outstanding includes 3,672,017 shares
outstanding as of May 31, 1997, plus any shares subject to options held by
the person or group in question that are exercisable as of or within sixty
days after May 31, 1997.
(3) Kopp Investment Advisors, Inc. serves as an investment adviser and
exercises investment power with respect to all such shares. Kopp
Investment Advisors, Inc. disclaims beneficial ownership of all such
shares.
(4) Based solely on information contained in filings made with the Securities
and Exchange Commission pursuant to Section 13(d) or 13(g) of the
Securities Exchange Act of 1934 (the "1934 Act").
2
<PAGE>
ELECTION OF DIRECTORS
(ITEM 1 OF NOTICE)
There are currently five members of the Board of Directors, divided into
three classes with terms expiring respectively at the 1997, 1998 and 1999
annual meetings of stockholders. The Board has nominated Sebastian J. Sicari
and Dr. Sheldon Weinig, whose terms are expiring, for re-election. Mr. Sicari
and Dr. Weinig have consented to serve, if elected at the meeting, for three-
year terms expiring at the time of the 2000 annual meeting of stockholders and
when their successors are elected and qualified. The shares represented by the
enclosed proxy will be voted to elect Mr. Sicari and Dr. Weinig unless such
authority is withheld by marking the proxy to that effect. Mr. Sicari and Dr.
Weinig have agreed to serve, but in the event either becomes unavailable for
any reason, the proxy, unless authority has been withheld as to such nominee,
may be voted for the election of a substitute.
The following information is furnished with respect to the nominees for
election as directors and each director whose term of office will continue
after the meeting.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
NAME AND AGE DIRECTOR BUSINESS EXPERIENCE
AS OF MAY 31, 1997 SINCE DURING LAST FIVE YEARS
------------------ -------- ------------------------
<S> <C> <C>
NOMINEES FOR ELECTION FOR TERMS OF THREE YEARS EXPIRING IN 2000
Sebastian J. Sicari, 45. 1993 Mr. Sicari has been Vice President, Finance and
Administration, and Chief Financial Officer of
the Company since December 1985 and has served
as Treasurer of the Company since July 1988.
Dr. Sheldon Weinig, 69.. 1994 Dr. Weinig founded Materials Research Company
and served as its Chairman until 1989 when it
was acquired by the Sony Corporation of
America. He then served as Vice Chairman of
Sony Engineering and Manufacturing of America
until April 1, 1996 when he retired from that
company. He is presently a Professor at
Columbia University and the State University of
New York at Stonybrook, New York. Dr. Weinig is
a Director of Insituform Technologies, Inc., a
provider of pipeline reconstruction techniques,
Intermagnetics General Corporation, a
manufacturer of superconducting materials and
magnets, and U.S. Cast Polymer, a materials
company.
DIRECTORS WHOSE TERMS EXPIRE IN 1998
Carl S. Archer, Jr., 60. 1987 Mr. Archer has been President and Chief
Executive Officer of the Company since November
1987 and Chairman of the Board of Directors
since August 1993.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND
NAME AND AGE DIRECTOR BUSINESS EXPERIENCE
AS OF MAY 31, 1997 SINCE DURING LAST FIVE YEARS
------------------ -------- ------------------------
DIRECTORS WHOSE TERMS EXPIRE IN 1999
<S> <C> <C>
Dr. Sheldon Buckler, 66. 1994 Dr. Buckler served as Vice Chairman of Polaroid
Corporation from 1990 until 1994. Since May
1995, he has served as Chairman of Commonwealth
Energy Systems, an energy utility.
Dr. Gerald L. Wilson, 1996 Dr. Wilson is currently a faculty member and the
58..................... Vannevar Bush Professor of Engineering in the
departments of Electrical Engineering and
Mechanical Engineering at the Massachusetts
Institute of Technology. He was Dean of the
School of Engineering at Massachusetts
Institute of Technology from 1981 until 1991.
Dr. Wilson serves as a Director of Analogic
Corporation, an electronics manufacturing
company, and Commonwealth Energy Systems, and
as a member of the technical advisory boards of
General Motors, Cummins Engine and United
Technologies Corporation.
</TABLE>
BOARD OF DIRECTORS AND COMMITTEE MEETINGS
The Board of Directors has an Audit, Compensation and Nominating Committee.
The Audit Committee reviews the internal accounting procedures of the
Company and consults with and reviews the services provided by the Company's
independent auditors. The directors currently serving on the Audit Committee
are Drs. Buckler, Weinig and Wilson. The Audit Committee met three times
during fiscal 1997.
The Compensation Committee reviews and recommends to the Board the
compensation and benefits of all officers of the Company and reviews general
policy relating to compensation and benefits of employees of the Company. The
Compensation Committee also administers the issuance of stock options. The
directors currently serving on the Compensation Committee are Drs. Buckler,
Weinig and Wilson. The Compensation Committee met three times during fiscal
1997.
The Nominating Committee reviews and recommends to the Board candidates for
director. The directors currently serving on the Nominating Committee are Mr.
Archer and Drs. Weinig and Buckler. The Nominating Committee did not meet
during fiscal 1997. The Nominating Committee will consider director nominees
recommended by stockholders. Stockholder recommendations of director nominees
should be in writing, addressed to the chairman of the committee, Dr. Sheldon
Weinig, at the Company's address shown on the first page of this Proxy
Statement.
During fiscal 1997, the Board of Directors of the Company held six meetings.
Each incumbent director attended at least 75% of the aggregate number of the
meetings of the Board and the meetings of the committees of the Board on which
he served.
4
<PAGE>
EXECUTIVE OFFICER COMPENSATION
The following summary compensation table sets forth the compensation paid or
accrued for services rendered in fiscal 1997, 1996 and 1995 to the chief
executive officer and the other two most highly compensated executive officers
of the Company (the "Named Executive Officers"). None of the Company's other
executive officers' combined annual salary and bonus exceeded $100,000 during
fiscal 1997.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSA-
TION AWARDS
-----------
ANNUAL COMPENSATION SHARES ALL OTHER
FISCAL ------------------- UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS ($) OPTIONS (#) ($)(1)
- --------------------------- ------ --------- --------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Carl S. Archer, Jr........ 1997 $267,000 -- 145,000(2) $4,083
President and Chief 1996 262,633 $95,000 145,000(3) 2,930
Executive Officer 1995 210,538 -- -- 2,742
C. Kenneth Gray........... 1997 155,000 -- 55,000(2) 2,304
Vice President, Sales and 1996 141,756 100,337 65,000(3) 2,476
Marketing 1995 129,458 -- -- 1,276
Sebastian J. Sicari....... 1997 178,400 -- 90,000(2) 2,227
Vice President, Finance 1996 161,202 100,337 100,000(3) 1,422
and Administration 1995 147,506 -- -- 1,305
</TABLE>
- --------
(1) For fiscal 1997, consists of (i) contributions to 401(k) accounts in the
amount of $1,500 for each Named Executive Officer and (ii) insurance
premiums paid by the Company during the covered fiscal years with respect
to term life insurance for the benefit of the Named Executive Officers.
(2) These options include the grant of options to Messrs. Archer, Gray and
Sicari exercisable for 108,750, 41,250 and 67,500 shares, respectively, in
replacement of certain options granted in fiscal 1996, as described in the
"Ten-Year Option Repricing" table below.
(3) Certain of the options granted in fiscal 1996 to Messrs. Archer, Gray and
Sicari were cancelled in connection with the repricings set forth in the
"Ten-Year Option Repricing" table below.
5
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information regarding options to
purchase shares of the Company's common stock granted during fiscal 1997 by
the Company to the Named Executive Officers.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED RATES
NUMBER OF % OF TOTAL OF STOCK PRICE
SECURITIES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM (1)
OPTIONS EMPLOYEES IN PRICE EXPIRATION -----------------------
NAME GRANTED (#) FISCAL YEAR ($/SHARE) DATE 5% 10%
---- ----------- ------------ --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Carl S. Archer, Jr...... 108,750(2) 23.7% $10.375 8/7/01 $ 306,008 $ 675,060
36,250(3) 7.9 9.875 10/18/06 225,125 570,510
C. Kenneth Gray......... 41,250(2) 9.0 10.375 8/7/01 116,072 256,057
13,750(3) 3.0 9.875 10/18/06 85,392 216,400
Sebastian J. Sicari..... 67,500(2) 14.7 10.375 8/7/01 189,936 419,003
22,500(3) 4.9 9.875 10/18/06 139,733 354,110
</TABLE>
- --------
(1) Amounts represent hypothetical gains that could be achieved for the
respective options if such options are not exercised until the end of the
option term. These gains are based on assumed rates of stock price
appreciation of 5% and 10% set by the Securities and Exchange Commission,
compounded annually from the dates the respective options were granted
until their respective expiration dates and, therefore, are not intended
to forecast possible future appreciation, if any, in the common stock.
This table does not take into account any actual appreciation in the price
of the common stock after the date of grant.
(2) These options were granted in exchange for the cancellation of previously
granted options to purchase a greater number of shares at $18.69 per
share. See "Compensation Committee Report" below. These options were
vested at the date of grant with respect to one-third of the shares
covered thereby (equal to the number of shares with respect to which the
canceled options were vested), and the balance of the shares covered
thereby vest in equal quarterly installments over the three-year period
following the date of grant. In the event of a change in control of the
Company, these options vest in full immediately.
(3) These options vest in equal quarterly installments over a four-year period
beginning on the date of grant.
OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES
The following table sets forth information regarding (a) the number of
shares acquired upon the exercise of options during fiscal 1997 and the value
realized therefrom and (b) the number of vested and unvested options and the
unrealized value or spread (the difference between the exercise price and the
market value) of the unexercised options issued by the Company and held by the
Named Executive Officers on March 30, 1997.
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
UNDERLYING IN-THE-MONEY
SHARES UNEXERCISED OPTIONS (#) OPTIONS ($)
ACQUIRED ON VALUE ------------------------- ----------------------
NAME EXERCISE (#) REALIZED ($) VESTED UNVESTED VESTED UNVESTED
---- ------------ ------------ ------------ ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Carl S. Archer, Jr...... -- -- 157,968 77,032 $491,758 $ 35,118
Sebastian J. Sicari..... -- -- 124,188 50,812 405,704 21,797
C. Kenneth Gray......... 5,000 $35,625 62,154 32,844 190,561 14,023
</TABLE>
6
<PAGE>
TEN-YEAR OPTION REPRICINGS
The following table sets forth information regarding all repricings of
options held by executive officers of the Company since the Company became
subject to the reporting requirements of the 1934 Act in March 1993.
<TABLE>
<CAPTION>
NUMBER OF
SHARES
UNDERLYING MARKET PRICE EXERCISE
OPTIONS OF STOCK AT PRICE AT LENGTH OF ORIGINAL
REPRICED OR TIME OF TIME OF NEW OPTION TERM
AMENDED REPRICING REPRICING EXERCISE REMAINING AT DATE
NAME DATE (#)(1) ($) ($) PRICE ($) OF REPRICING
---- ---- ----------- ------------ --------- --------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Carl S. Archer, Jr...... 9/2/96 145,000 $10.375 $18.69 $10.375 4 years, 11 months
Sebastian J. Sicari..... 9/2/96 90,000 10.375 18.69 10.375 4 years, 11 months
C. Kenneth Gray......... 9/2/96 55,000 10.375 18.69 10.375 4 years, 11 months
</TABLE>
- --------
(1) The number of shares of common stock underlying the repriced options was
reduced for Messrs. Archer, Sicari and Gray to 108,750, 67,500 and 41,250
shares, respectively.
SEVERANCE AND CHANGE OF CONTROL ARRANGEMENTS
Pursuant to Severance Agreements dated December 30, 1996, the Company has
agreed to pay each of Messrs. Archer and Sicari severance equal to twelve
months of base salary, the average of the annual bonus amounts paid to him for
each of the two previous fiscal years, and twelve months of continued health
insurance benefits if the Company terminates his employment for any reason
other than for cause. In the event either of such individual's employment is
terminated at any time after a Change of Control Event for any reason except
death, he is entitled to severance equal to twenty-four months of base salary,
two times the average of the annual bonus amounts paid to him for each of the
two previous fiscal years, and twenty-four months of continued health
insurance benefits. A "Change of Control Event" is defined to mean any of the
following events: (a) the sale, lease, transfer or other disposition by the
Company of all or substantially all of its assets; (b) the merger or
consolidation of the Company with another entity in which the stockholders of
the Company immediately prior to such merger or consolidation hold less than
50% of the outstanding voting stock of the surviving or resulting corporation
immediately following such transaction; or (c) the sale or exchange by the
Company's stockholders of greater than 50% of the Company's outstanding voting
stock. In addition, upon any Change of Control Event, the Company's repurchase
rights with respect to any shares of Common Stock held by such individuals
shall lapse and such individuals shall have the right to exercise any options
held by them to purchase shares of common stock. These agreements may have the
possible effect of discouraging unsolicited takeover attempts.
The Company has also agreed to pay to Mr. Gray, pursuant to a Severance
Agreement dated March 18, 1997, severance equal to six months of base salary
and six months of continued health insurance benefits if the Company
terminates his employment for any reason other than for cause.
As of March 30, 1997, Messrs. Archer, Sicari and Gray held options to
purchase 198,750, 142,500 and 61,250 shares, respectively, which stock options
by their terms become immediately exercisable in full upon (i) the acquisition
by any person, entity or group of more than 35% of the aggregate voting power
of the outstanding securities of the Company, (ii) a majority of the Board of
Directors ceasing to consist of individuals (A) who are currently members of
the Board or (B) for whose nomination for such membership a majority of such
current members voted in favor, or (iii) the disposition by the Company of
substantially all its business, other than in connection with a mere change of
place of incorporation or similar change in form.
INDEBTEDNESS OF MANAGEMENT
On April 15, 1996, the Company loaned $140,000 to Sebastian J. Sicari, a
director and executive officer of the Company. The loan bears interest at a
rate of 5.33% per annum, compounded annually, and is due and payable in full
on the earlier of the termination of Mr. Sicari's employment with the Company
or April 15, 1999. At March 30, 1997, principal and accrued interest on the
loan totalled $147,384. The loan is secured by shares of the Company's common
stock owned by Mr. Sicari.
7
<PAGE>
DIRECTOR COMPENSATION
Non-employee directors are paid (i) an annual retainer of $5,000, (ii)
$1,000 for each regular or special Board of Directors meeting attended and
(iii) $500 for each Board Committee meeting attended on a day on which no
meeting of the Board of Directors is held. Non-employee directors also are
reimbursed for their reasonable out-of-pocket expenses incurred in connection
with meeting attendance. In addition, under the Company's 1993 Non-Employee
Director Stock Option Plan, each non-employee director serving as such on
April 30 of each year is automatically granted an option exercisable (subject
to a two-year vesting period) for the purchase of 2,500 shares of the
Company's common stock at a price per share equal to fair market value at the
date of grant. Any non-employee director, upon his or her first election to
the Board of Directors, is entitled to receive an option to purchase 15,000
shares of common stock.
8
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
This report, prepared by the Compensation Committee of the Company's Board of
Directors (the "Committee"), addresses the Company's executive compensation
policies and the basis on which fiscal 1997 executive officer compensation
determinations were made. The Committee designs and approves all components of
executive pay.
To ensure that executive compensation is designed and administered in an
objective manner, the Committee's members are all non-employee directors.
During the portion of fiscal 1997 ending on August 8, 1996, Committee members
were Sheldon Buckler, Kenneth W. Tunnell and Charles D. Yie. During the balance
of fiscal 1997, the Committee was composed of Sheldon Buckler, Sheldon Weinig
and Gerald Wilson.
Compensation Philosophy
The objectives of the Company's executive compensation program are to (i)
enable the Company to attract, retain and reward executives who contribute to
both the short-term and long-term success of the Company, (ii) align
compensation with business objectives and individual performance, and (iii) tie
the interests of the Company's executives to the interests of the Company's
stockholders. The primary components of the Company's executive compensation
program are salary, cash bonuses and stock options. In addition, executives are
eligible to participate, on a non-discriminatory basis, in various benefit
programs provided to all full-time employees, including the Company's stock
purchase plan and group medical, disability and life insurance programs. The
Committee believes that executive compensation packages should be viewed as a
whole in order to properly assess their appropriateness.
In establishing total compensation packages for its executive officers, the
Committee takes into account the compensation packages offered to executives of
other semiconductor capital equipment companies of similar stature. These
companies are not included in the published industry index represented in the
Comparison of Cumulative Total Stockholder Return Graph on page 11. The
Committee uses this comparative data primarily as benchmarks to ensure that the
Company's executive compensation packages are competitive. The Committee seeks
to maintain total compensation within the broad middle range of comparative
pay. Individual amounts are based not only on comparative data, but also on
such factors as length of service with the Company, prior experience and the
Committee's judgment as to individual contributions. These factors are not
assigned specific mathematical weights.
Salary
Amounts shown under the Salary column of the Summary Compensation Table
represent the fixed portion of compensation for executive officers in fiscal
1997. Changes in salary from year to year depend on such factors as individual
performance, cost of living changes, and the economic and business conditions
affecting the Company. Executive salaries are set at the beginning of each
fiscal year.
Mr. Archer received salary compensation of $267,000 in fiscal 1997. Mr.
Archer's salary was based on an assessment of comparative industry salaries.
Bonus
Amounts shown in the Bonus column of the Summary Compensation Table, together
with stock option grants, represent the variable compensation for executive
officers. Cash bonuses are based on the achievement of specific financial
performance goals by the Company as well as specific goals and objectives by
the executive officer. The Company seeks to structure each executive's bonus so
that, if the executive earns his maximum bonus, his combined salary and bonus
will be roughly equal to the average prior year's reported combined salary and
bonus of executives holding the same position with other semiconductor capital
equipment companies of similar stature. In fiscal 1997, no bonuses were granted
to executive officers due to the failure of the Company to meet the financial
performance goals set for fiscal 1997.
Stock Options
The Committee believes that stock ownership by executive officers is
important in aligning management and stockholder interests in the long-term
enhancement of stockholder value. Stock options are awarded based
9
<PAGE>
upon the market price of the Company's common stock on the date of grant and
are linked to future performance of the Company's stock because they do not
become valuable to the holder unless the price of the Company's stock
increases above the price on the date of grant. Beginning in fiscal 1994, the
Company granted options to its executive officers, the exercisability of which
was tied to the Company's achievement of specified financial performance
goals. In fiscal 1997, however, the Committee changed its policy in favor of
annual grants of options to executive officers, the exercisability of which is
tied solely to the continued employment of the executive. Also in fiscal 1997,
the Company for the first time repriced certain employee options, including
certain options held by executive officers. See "Repricing of Stock Options"
below.
The number of shares for which options were granted to executive officers in
fiscal 1997 was determined by the Committee based upon several factors,
including the executive's position, his past and future expected performance,
the comparative data described above, and the number of shares under
previously granted options. These factors were evaluated in a qualitative
manner and were not assigned predetermined weights.
Repricing of Stock Options
On August 23, 1996, the Committee approved the offer by the Company to
employees of the Company holding options to purchase common stock at $18.69
per share (the "Existing Options") to exchange (the "Exchange") their Existing
Options for new options (the "New Options") (i) exercisable for 75% of the
number of shares subject to the Existing Options, (ii) having an exercise
price of $10.375 per share, the fair market value of the Company's common
stock on August 23, 1996 and (iii) vested to the same extent, based on the
number of shares vested, as the Existing Options, but with the balance of the
shares subject thereto vesting in equal quarterly installments over the three-
year period following the date of grant assuming the optionee's continued
employment by the Company (rather than vesting based on the achievement of
Company stock price and earnings per share milestones as was the case with the
Existing Options). In view of the decline in the market value of the common
stock, the Committee determined that the Existing Options provided inadequate
incentive to motivate and retain employees and that the foregoing repricing
offer was important to regain the incentive intended to be provided by options
to purchase the Company's stock. The Committee also determined that under a
Black-Scholes valuation analysis the value of the New Options approximated the
value of the Existing Options thereby minimizing the dilution to existing
stockholders of the Company. The Exchange was effected on September 2, 1996 by
canceling the Existing Options surrendered for cancellation by persons
accepting the Exchange offer and granting such persons New Options. All of the
Named Executive Officers participated in the Exchange and the New Options
granted to them are shown in the Ten-Year Option Repricing table above.
Deductibility of Executive Compensation
Section 162(m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to public companies for compensation over $1 million
paid to its chief executive officer and its four other most highly compensated
executives. Performance-based compensation is excluded from the compensation
taken into account for purposes of the limit if certain requirements are met.
The Company currently intends to structure its stock options granted to
executives in a manner that complies with the performance-based requirements
of the statute. The Committee believes that, given the general range of
salaries and bonuses for executive officers of the Company, the $1 million
threshold of Section 162(m) will not be reached by any executive officer of
the Company in the foreseeable future. Accordingly, the Committee has not
considered what its policy regarding compensation not qualifying for federal
tax deductibility might be at such time, if ever, as that threshold is within
range of any executive officer.
Compensation Committee
Sheldon Buckler
Sheldon Weinig
Gerald Wilson
10
<PAGE>
COMPARISON OF CUMULATIVE TOTAL STOCKHOLDER RETURN
The following performance graph assumes an investment of $100 on March 16,
1993 (the date the Company's common stock was first registered under Section
12 of the 1934 Act) and compares the changes thereafter in the market price of
the Company's common stock with a broad market index (S&P 500) and an industry
index (S&P Electronics-Instrumentation). The Company paid no dividends during
the periods shown; the performance of the indexes is shown on a total return
(dividend reinvestment) basis. The graph lines merely connect fiscal year-end
dates and do not reflect fluctuations between those dates.
COMPARISON OF CUMULATIVE TOTAL RETURN
OF COMPANY, INDUSTRY INDEX AND BROAD MARKET
<TABLE>
<CAPTION>
FISCAL YEAR ENDING
COMPANY 1993 1993 1994 1995 1996 1997
<S> <C> <C> <C> <C> <C> <C>
ASECO CORPORATION 100 92.68 74.39 103.66 106.10 103.66
S&P INDUSTRY
GROUP 230-ELECTRONICS
(INSTRUMENTATION) 100 100.00 108.36 156.24 209.95 264.51
S&P 500 100 100.00 101.48 117.27 154.92 185.64
</TABLE>
THE COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION AND THE
COMPARISON OF CUMULATIVE TOTAL STOCKHOLDER RETURN INFORMATION ABOVE SHALL NOT
BE DEEMED "SOLICITING MATERIAL" OR INCORPORATED BY REFERENCE INTO ANY OF THE
COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION BY IMPLICATION
OR BY ANY REFERENCE IN ANY SUCH FILING TO THIS PROXY STATEMENT.
11
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No person serving on the Compensation Committee at any time during fiscal
1997 was a present or former officer or employee of the Company or any of its
subsidiaries. During fiscal 1997, no executive officer of the Company served
as a member of the board of directors or compensation committee (or other
board committee performing equivalent functions) of another entity one of
whose executive officers served on the Company's Board of Directors or
Compensation Committee.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the 1934 Act requires the Company's officers and directors
and persons who own more than ten percent of its common stock to file reports
with the Securities and Exchange Commission disclosing their ownership of
stock in the Company and changes in such ownership. Copies of such reports are
also required to be furnished to the Company. Based solely on a review of the
copies of such reports received by it, the Company believes that, during
fiscal 1997, all such filing requirements were complied with, except that Mr.
Archer filed one late Form 4 report, Dr. Buckler filed two late Form 4
reports, Mr. Legal filed one late Form 3 report and one late Form 4 report,
Mr. Sicari filed one late Form 4 report, Mr. Tunnell filed one late Form 4
report, Dr. Weinig filed two late Form 4 reports, Dr. Wilson filed one late
Form 4 report and Mr. Yie filed one late Form 4 report.
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
(ITEM 2 OF NOTICE)
On the recommendation of the Audit Committee, the Board of Directors has
selected Ernst & Young LLP, independent auditors, as auditors of the Company
for the fiscal year ending March 29, 1998. This firm has audited the accounts
and records of the Company since 1989. A representative of Ernst & Young LLP
will be present at the Annual Meeting to answer appropriate questions from
stockholders and will have an opportunity to make a statement if desired.
The selection of independent auditors is not required to be submitted to a
vote of the stockholders. The Board believes, however, it is appropriate as a
matter of policy to request that the stockholders ratify the appointment. If
the stockholders do not ratify the appointment, the Board will reconsider its
selection.
STOCKHOLDER PROPOSALS FOR 1998 MEETING
Proposals of stockholders intended to be presented at the 1998 Annual
Meeting of Stockholders must be presented on or before March 4, 1998 for
inclusion in the proxy materials relating to that meeting. Any such proposals
should be sent to the Company at its principal offices addressed to the Vice
President, Finance and Administration. Other requirements for inclusion are
set forth in Rule 14a-8 under the 1934 Act.
12
<PAGE>
OTHER MATTERS
The Company has no knowledge of any matters to be presented for action by
the stockholders at the Annual Meeting other than as set forth above. However,
the enclosed proxy gives discretionary authority to the persons named therein
to act in accordance with their best judgment in the event that any additional
matters should be presented.
The Company will bear the cost of the solicitation of proxies by management,
including the charges and expenses of brokerage firms and others for
forwarding solicitation material to beneficial owners of common stock.
By order of the Board of Directors
Robert V. Jahrling, Secretary
July 2, 1997
The Board hopes that stockholders will attend the Annual Meeting. WHETHER OR
NOT YOU PLAN TO ATTEND, YOU ARE URGED TO COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. A prompt response will greatly
facilitate arrangements for the Annual Meeting, and your cooperation will be
appreciated. Stockholders who attend the Annual Meeting may vote their stock
personally even though they have sent in their proxies.
13
<PAGE>
Please mark your
A [X] votes as in this
example.
1.) To elect two FOR WITHHOLD
directors for a
three-year term. [ ] [ ]
NOMINEES: SEBASTIAN J. SICARI
DR. SHELDON WEINIG
If you do not wish your shares voted for
a particular nominee, complete the "For
All Except" line below or strike a line
through the nominee's name.
For all Except
__________________________________________
2.) To ratify the Board of Directors' selection of FOR AGAINST ABSTAIN
Ernst & Young LLP as the Company's independent
auditors for the fiscal year ending March 29, [ ] [ ] [ ]
1998.
3.) To transact such business as may properly come FOR AGAINST ABSTAIN
before the meeting and any or all adjournments
thereof. [ ] [ ] [ ]
MARK BOX AT RIGHT IS COMMENTS OR ADDRESS CHANGE HAVE BEEN [ ]
NOTED ON THE REVERSE SIDE OF THIS CARD.
Stockholder sign here_________________________________________
Co-owner sign here____________________________________________
Date: _________________________
NOTE: Please be sure to sign and date this Proxy
<PAGE>
PROXY ASECO CORPORATION PROXY
PROXY SOLICITED BY THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS--AUGUST 6, 1997
The undersigned hereby acknowledge(s) receipt of the Notice and accompanying
Proxy Statement, revoke(s) any prior proxies, and appoint(s) Carl S. Archer,
Jr., Sebastian J. Sicari and Robert V. Jahrling, III, and each of them, with
power of substitution in each, attorneys for the undersigned to act for and
vote, as specified on the reverse, all shares of stock which the undersigned may
be entitled to vote at the Annual Meeting of the Stockholders of Aseco
Corporation, to be held on Wednesday, August 6, 1997 at Choate, Hall & Stewart,
36th Floor, Exchange Place, Boston, Massachusetts at 10:00 a.m. and at any
adjourned sessions thereof.
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. ALL PROPOSALS SET FORTH ON THE REVERSE OF THIS
PROXY CARD HAVE BEEN PROPOSED BY THE BOARD OF DIRECTORS. IF NO DIRECTION IS
GIVEN, THIS PROXY CARD WILL BE VOTED "FOR" THE NOMINEES FOR DIRECTOR AND "FOR"
ALL OTHER PROPOSALS. THE PROXY WILL BE VOTED IN ACCORDANCE WITH THE HOLDER'S
BEST JUDGEMENT AS TO ANY OTHER MATTER.
- --------------------------------------------------------------------------------
PLEASE VOTE, DATE AND SIGN ON OTHER SIDE AND
RETURN PROMPTLY IN ENCLOSED ENVELOPE.
- --------------------------------------------------------------------------------
Please sign this proxy exactly as your name appears on the books of the Company.
Joint owners should each sign personally. Trustees and other fiduciaries should
indicate the capacity in which they sign, and where more than one name appears,
a majority must sign. If a corporation, this signature should be that of an
authorized officer who should state his or her title.
- --------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED DO YOU HAVE ANY COMMENTS?
- ----------------------------------- -----------------------------------
- ----------------------------------- -----------------------------------
- ----------------------------------- -----------------------------------
(CONTINUED ON REVERSE SIDE)
