SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11 or Rule 14a-12
MRS Technology, Inc.
- ----------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ----------------------------------------------------------------
(Name of Person Filing Proxy Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(12)(ii), 14a-6(I)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each part to the controversy pursuant to Exchange
Act Rule 14a-6(I)(3).
[ ] 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 transactions:.....
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>
MRS TECHNOLOGY, INC.
10 Elizabeth Drive
Chelmsford, MA 01824
Notice of Annual Meeting of Stockholders to be held July 30, 1997
The Annual Meeting of Stockholders of MRS Technology, Inc. will be held
on Wednesday, July 30, 1997, at 10:00 a.m. at the BankBoston auditorium,
150 Royall Street, Canton, Massachusetts for the following purposes:
1. To elect one person to the Board of Directors to serve as Class II
Director for a three-year term.
2. To ratify the appointment of Coopers & Lybrand L.L.P. as auditors
for the fiscal year ending March 31, 1998.
3. To transact such other business as may properly come before the
meeting or any adjournament of it.
Stockholders of record on June 2, 1997 will be entitled to notice of and
to vote at the meeting.
By Order of the Board of Directors
June 6, 1997
John L. Steele, Jr., Secretary
Stockholders are requested to sign the enclosed proxy and return it
in the envelope provided. Please do this even if you expect to attend
the Meeting.
<PAGE>
MRS TECHNOLOGY, INC.
10 Elizabeth Drive
Chelmsford, MA 01824
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
Wednesday, July 30, 1997
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of MRS Technology, Inc. ("MRS" or the "Company"),
10 Elizabeth Drive, Chelmsford, MA 01824, of proxies to be voted at the
Annual Meeting of Stockholders of MRS Technology, Inc. to be held at
10:00 a.m. on Wednesday, July 30, 1997 at the BankBoston auditorium,
Blue Hills Office Park, 150 Royall Street, Canton, Massachusetts, and
at any adjournments thereof, for the purposes stated in the accompanying
Notice of Meeting.
Any person giving a proxy may revoke it at any time prior to its being
voted by filing written notice with the Secretary of MRS, by executing
and delivering a proxy bearing a later date, or by attending the meeting
and voting in person. If the proxy is properly executed and is not
revoked, it will be voted at the meeting in the manner specified. If no
instructions are specified, the shares represented by the proxy will be
voted for the election of the one nominee for director listed below and
for the approval of Item 2 in the Notice of Meeting.
The Annual Report of MRS for the fiscal year ended March 31, 1997 and
this Proxy Statement were first distributed or mailed to stockholders
on or about June 18, 1997.
SOLICITATION
MRS will bear the entire cost of preparing, assembling, copying and mailing
the Proxy Statement, the proxy, and any additional material which may be
furnished to stockholders. Further solicitation of proxies may be made
by telephone or oral communication. Brokers, custodians and fiduciaries
in whose names Common Stock is held will be requested to forward Proxy
soliciting material to the beneficial owners of such stock and the Company
will reimburse them for this service.
VOTING SECURITIES
The Company's Common Stock, par value $0.01 per share, is the only class
of voting securities outstanding and entitled to be voted at the Annual
Meeting. Holders of record of Common Stock on June 2, 1997 are entitled
to notice of and to vote at the Annual Meeting. At the close of business
on June 2, 1997, there were outstanding 6,792,728 shares of Common Stock.
Each share is entitled to one vote, with no cumulative voting. A majority
in interest of all capital stock entitled to vote constitutes a quorum.
VOTES REQUIRED
The affirmative vote of the holders of a majority of the shares of Common
Stock present or represented by proxy at the Meeting and voting on a matter
is required for the election of the director and the approval of each of
the other matters to be voted upon.
<PAGE>
Shares of Common Stock represented by executed proxies received by the
Company will be counted for purposes of establishing a quorum at the
Meeting. Accordingly, broker non-votes (if the broker has voted on any
item before the meeting), and proxies that withhold authority to vote
for election as a director or that reflect abstentions will be deemed
present for the purposes of determining the presence of a quorum for
the transaction of business. Broker non-votes will have no effect on
the outcome of the voting on any proposals. Abstentions will have the
effect of a vote against such proposals.
SHARE OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth certain information as of June 2, 1997
with respect to the beneficial ownership of the Common Stock by (i) each
person known to the Company to own of record or beneficially more than
5% of the voting securities of the Company, (ii) those persons listed in
the Summary Compensation Table below, (iii) each director and nominee for
director of the Company, and (iv) all present officers and directors of
the Company as a group. As of June 2, 1997, 6,792,728 shares of Common
Stock were outstanding.
<TABLE>
<CAPTION>
Name and address of Amount and Nature of
Beneficial Owner Beneficial Ownership(1) Percent of Class
- -------------------- ----------------------- ----------------
<S> <C> <C>
Griffith L. Resor, III(2) 184,269 2.69%
Robert P. Schechter(3) 27,666 0.41%
Bennett F. Moore(4) 15,000 0.22%
Ronald K. Haigh(5) 20,000 0.29%
William C. Schneider(6) 77,777 1.13%
John C. Plummer(7) 28,499 0.42%
Mark Lucas(8) 27,508 0.40%
John L. Steele, Jr.(9) 87,283 1.28%
All officers and directors
as a group (10 persons)
( 2 through 10) 509,128 7.15%
</TABLE>
(1) Unless otherwise indicated in these footnotes, each stockholder has
sole voting and investment power with respect to the shares beneficially
owned.
(2) Includes 82,602 shares issuable upon exercise of an option held by
Mr. Resor, a director of the Company, which option is exercisable within
60 days after June 2, 1997
(3) Includes 26,666 shares issuable upon exercise of an option held by
Mr. Schechter, a director of the Company, which option is exercisable
within 60 days after June 2, 1997.
(4) Includes 15,000 shares issuable upon exercise of an option held by
Mr. Moore, a director of the Company, which option is exercisable within
60 days after June 2, 1997.
(5) Includes 20,000 shares issuable upon exercise of an option held by
Mr. Haigh, a director of the Company, which option is exercisable within
60 days after June 2, 1997.
<PAGE>
(6) Includes 62,042 shares issuable upon exercise of option held by
Mr. Schneider, an officer of the Company, which is exercisable within
60 days after June 2, 1997.
(7) Includes 23,833 shares issuable upon exercise of option held by
Mr. Plummer, an officer of the Company, which is exercisable within
60 days after June 2, 1997.
(8) Includes 25,871 shares issuable upon exercise of option held by
Mr. Lucas, an officer of the Company, which is exercisable within 60
days after June 2, 1997.
(9) Includes 39,950 shares issuable upon exercise of option held by
Mr. Steele, an officer of the Company, which is exercisable within 60
days after June 2, 1997.
(10) Includes 13,193 shares issuable upon exercise of options held by
certain other officers (other than Messrs. Resor, Schneider, Plummer,
Lucas and Steele, whose exercisable options are identified above)
upon exercise of options which are exercisable within 60 days after
June 2, 1997.
ITEM 1. ELECTION OF DIRECTORS
Section 50A of Chapter 156B of the Massachusetts General Laws provides
for a Board of Directors of such number, to be fixed by the directors,
as is a multiple of three, serving staggered three-year terms. Currently,
the Board of Directors consists of one Class II Director, two Class III
Directors and one Class I Director, whose terms will expire in 1997,
1998 and 1999, respectively. A vacancy was created in Class II by the
resignation in September 1996 of S. Russel Craig, a director since 1994.
This vacancy was filled by the Board of Directors on May 30, 1997 with the
election of Carl P. Herrmann.
At the 1997 Annual Meeting, the stockholders will elect one Class II
Director, whose term will extend until the 2000 Annual Meeting. Bennett
F. Moore, a Class II Director since 1994 whose term of office expires at
the Annual Meeting, has informed the Company that he will be unable to
stand for reelection. The Board of Directors has recommended the
following nominee to fill a Class II Director position. The nominee,
if elected, will hold office for a three-year term until the 2000 Annual
Meeting of Stockholders and until a successor is elected and qualified.
If for any reason this nominee should become unavailable for election, the
persons named in the proxy may vote the proxy for the election of a
substitute. However, the nominee has consented to serve as a director
if elected and the Board of Directors has no reason to believe the nominee
will become unavailable for election.
Carl P. Herrmann, 49, has been an independent management and international
marketing consultant since December 1994. From July 1991 to November 1994,
he was at Solbourne Computer, Inc. most recently as President and Chief
Executive Officer. From May 1989 to November 1990 he was the Hong Kong-
based Director of Asia/Pacific Operations for Amphenol Corp. From October
1984 to April 1989 he was Managing Director of GenRad Inc.'s regional
operations based in Singapore. From August 1993 to September 1994 he was
the Tokyo-based Vice President of TEL-GenRad, KK, a joint venture developing
and manufacturing PC board and semiconductor test systems.
<PAGE>
VOTE REQUIRED
The affirmative vote of the holders of a majority of votes cast at the
meeting is required for the election of directors. Unless authority is
withheld, it is the intention of the persons voting under the enclosed
proxy to vote such proxy in favor of the election of Mr. Herrmann as a
Class II director.
The following table sets forth certain information about those Directors
of the Company whose terms of office do not expire at the Annual Meeting
and who consequently are not nominees for reelection at the Annual Meeting:
<TABLE>
<CAPTION>
Term of
Director Position Office will
Name / Age Since with Company Class Expire
- ------------------- --------- -------------- ----- ------
<S> <C> <C> <C> <C>
Ronald K. Haigh /62 1994 Director III 1998
G.L.Resor, III /56 1986 President,Chief
Executive Officer
and Director III 1998
Robert P. Schechter/48 1988 Director I 1999
</TABLE>
Ronald K. Haigh, 62, has been an independent manufacturing technology
consultant since July 1994. He recently set up and staffed a 50,000
square foot manufacturing operation in Korea for a major U.S.
semiconductor equipment manufacturer. From 1988 to June 1994, he was
at Summit Technology, a manufacturer of laser-based surgery systems,
most recently as Vice President, Manufacturing.
Griffith L. Resor III, 56, has been President and a Director of MRS
since it was formed on February 21, 1986. Prior to forming MRS,
Mr. Resor served in various product development and management positions
at GCA Corporation, most recently as Vice President and General Manager
of New Products.
Robert P. Schechter, 48, joined Natural MicroSystems Corporation in April
1995 as President and Chief Executive Officer and in May 1996 was also
elected Chairman of the Board. From 1987 to December 1994, he was at
Lotus Development Corporation, most recently as Senior Vice President,
International Business Group. From 1973 and until he joined Lotus,
Mr. Schechter was associated with Coopers & Lybrand, most recently as a
Partner and Northeast Regional Chairman of Coopers & Lybrand's High
Technology Industry Group. Mr. Schechter is a director of Raptor Systems,
Inc. and Natural MicroSystems Corporation.
OTHER INFORMATION ABOUT THE BOARD AND ITS COMMITTEES
The Board of Directors met nine times in fiscal 1997. Each Director
attended at least 75%, of the aggregate of the total number of such
meetings of the Board of Directors and the total number of meetings held
by all committees on which the individual Director served.
During fiscal 1997, the Audit Committee of the Board of Directors consisted
of Messrs. Schechter and Moore. The Audit Committee met once in fiscal 1997.
The functions of the Audit Committee include: (1) making recommendations to
the Board of Directors with respect to the engagement of the Company's
independent auditors; (2) reviewing the audit plans developed by the
independent auditors for the annual audit of the Company's books and
records and the results of such audit; (3) reviewing the annual financial
statements; (4) reviewing the professional services provided by the
independent auditors and the auditors' independence; and (5) reviewing
the adequacy of the Company's system of internal controls and the response
to management letters issued by the independent auditors.
During fiscal 1997, the Compensation Committee consisted of Messrs.
Schechter and Craig. Mr. Craig resigned from the Board of Directors and
related committees in September of 1996 and the Board voted at the next
board meeting in October, 1996 to elect Ronald K. Haigh to serve as a
member of the Compensation Committee. The Compensation Committee completed
five meetings/actions by consent in fiscal 1997. The Compensation Committee
considers and, when appropriate, makes recommendations to the Board of
Directors regarding employee and Director compensation (including stock
compensation) matters.
The Board of Directors does not have a Nominating Committee or committee
performing a similar function.
DIRECTORS COMPENSATION
Directors do not receive cash compensation for services on the Board of
Directors or any committee thereof. As compensation for service as a
Director, each non-employee Director, upon election to the Board, is
entitled to receive an automatic stock option grant pursuant to the
Company's 1994 Stock Option Plan for Non-Employee Directors (the "1994
Plan"). During fiscal 1997, one non-employee director received an
automatic grant of options under the 1994 Plan to purchase 15,000 shares
of Common Stock, at fair market value as of the date of such grant ($2.875
per share), and 5,000 shares of such option became exercisable upon the
grant of option.
EXECUTIVE EMPLOYMENT AGREEMENTS
On January 30, 1996, the Company entered into letter agreements with
Messrs. Resor, Schneider, Plummer, Lucas and Steele as well as with
certain other officers and employees of the Company, in order to
encourage their continued employment with the Company. Under the
letter agreements, the Company agrees that, in the event of termination
of employment in connection with a merger or other change of control of
the Company, the Company will continue to pay the officer who is a party
thereto a certain percentage (90% for Messrs. Resor, Schneider, Plummer,
Lucas and Steele) of the officer's salary on January 26, 1996, for a
period of time (Messrs. Resor, Plummer and Steele, 52 weeks; Messrs.
Schneider and Lucas, 39 weeks) or until the officer finds comparable
employment. The letter agreements further provide that options held
by such officers will become fully vested upon the date of completion
of any merger or change of control of the Company and will be exercisable
for a period of four years following that date. Additionally, the
agreements provide that certain officers shall receive bonuses upon the
consummation of any merger or other change of control of the Company,
Mr. Resor will receive a bonus in the amount of $50,000 and Mr. Steele a
bonus of $20,000.
<PAGE>
EXECUTIVE COMPENSATION
The tables that appear below, together with the accompanying text and
footnotes, provide information on compensation and benefits for the
named officers, as determined by requirements of the Securities and
Exchange Commission ("SEC"). All the data regarding values for stock
options are hypothetical in terms of the amounts that an individual may
or may not receive because such amounts are contingent on continued
employment with the Company and the price of the Common Stock. All
year-end values shown in these tables for outstanding stock options
reflect a $1.25 price, which was the closing price of the Common Stock
on March 31, 1997, as reported in the "NASDAQ" section of the Eastern
Edition of The Wall Street Journal.
The following table sets forth certain compensation information for the
fiscal years ended March 31, 1997, 1996, and 1995 with respect to the
Company's Chief Executive Officer and those other officers of the
Company who were the most highly paid for fiscal 1997.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term
Compensation
Awards/
Annual Securities All Other
Name and Compensation Underlying Compensation
Principal Position Year Salary($) Options (#) ($)(1)
- ------------------ ---- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
G.L. Resor, III 1997 $165,577 157,248 (2) (3) $3,231
President and 1996 156,577 93,000 2,959
Chief Executive 1995 150,000 10,000 2,906
Officer
W.C. Schneider 1997 137,981 119,750 (2) (3) 1,603
Vice President 1996 124,193 43,000 1,379
Research & 1995 113,872 3,000 1,481
Development
John C. Plummer 1997 117,642 39,000 (3) 1,885
Vice President 1996 114,823 52,000 2,319
Manufacturing 1995 110,000 6,000 3,315
Mark Lucas 1997 115,217 115,000 (2) (3) 358
Vice President 1996 106,442 32,000 306
Product Marketing 1995 90,278 2,000 264
John L. Steele, Jr. 1997 106,715 25,125 (3) (4) 2,011
Vice President 1996 104,296 16,000 1,344
1995 99,275 3,000 2,107
</TABLE>
(1) The amounts reported reflect term life insurance premiums paid
on behalf of the officers.
(2) Includes options to purchase 50,000 shares of the Company's Common
Stock granted in July, 1996 which was canceled in February 1997 in
exchange for 37,500 shares at a lower price.
(3) Remaining balance of options granted in exchange for outstanding
options previously granted.
(4) Includes an option to purchase 7,500 shares of the Company's Common
Stock granted in July 1996 which was canceled in February 1997 in
exchange for 5,625 shares at a lower price.
The Compensation Committee of the Board of Directors reviewed and approved
the Bonus plan established for the executive officers and other key members
for the fiscal year 1996. This bonus plan was based on the achievement of
both individual and company goals. Payments were made to two officers
according to this plan in fiscal year 1997.
The Compensation Committee of the Board of Directors reviewed and approved
the Bonus plan established for the executive officers and other key members
for the fiscal year 1997. This bonus plan is based on the achievement of
both individual and company goals.
STOCK BASED COMPENSATION
The following table provides details regarding stock options granted to
the named officers in fiscal 1997 under the 1993 Stock Option Plan. In
addition, in accordance with SEC rules, this table shows hypothetical
gains on a pretax basis or "option spreads" that would exist for the
respective options granted in fiscal 1997 for the named officers. These
gains are based on assumed rates of annual compound stock price
appreciation of 5% and 10% from the date the options were granted over
the full option term.
<PAGE>
<TABLE>
<CAPTION>
Option Grants in Fiscal Year Ended March 31, 1997
Individual Grants
- ---------------------------------------------------------------
Percentage of
Total Options
Granted to
Employees Exercise
Options in Fiscal Price Expiration
Name Granted 1997 ($/sh) Date
- ---------------- -------- ------------ -------- ----------
<S> <C> <C> <C> <C> <C>
G.L. Resor, III 50,000 (2) 5.5% $3.250 07/09/06
37,500 (3) 4.1% $1.625 07/09/06
7,500 (3) 0.8% $1.625 08/30/04
15,750 (3) 1.7% $1.625 08/19/03
12,499 (3) 1.4% $1.625 06/01/03
18,999 (3) 2.1% $1.625 03/29/03
15,000 (3) 1.6% $1.625 05/12/05
------- -----
157,248 17.2%
W.C. Schneider 50,000 (2) 5.5% $3.250 07/09/06
10,500 (3) 1.1% $1.625 06/15/05
37,500 (3) 4.1% $1.625 07/09/06
7,500 (3) 0.8% $1.625 08/19/03
12,000 (3) 1.3% $1.625 05/12/05
2,250 (3) 0.2% $1.625 09/27/04
------- -----
119,750 13.0%
J.C.Plummer 12,000 (3) 1.3% $1.625 08/19/03
10,500 (3) 1.1% $1.625 06/15/05
4,500 (3) 0.5% $1.625 08/30/04
12,000 (3) 1.3% $1.625 05/12/05
------ -----
39,000 4.2%
Mark Lucas 50,000 (2) 5.4% $3.250 07/09/06
1,500 (3) 0.2% $1.625 09/27/04
18,000 (3) 1.9% $1.625 06/15/05
4,500 (3) 0.5% $1.625 05/12/05
37,500 (3) 4.1% $1.625 07/09/06
------- -----
111,500 12.1%
J. L. Steele, Jr. 7,500 (2) 0.8% $3.250 07/09/06
2,250 (3) 0.2% $1.625 05/12/05
7,500 (3) 0.8% $1.625 08/19/03
2,250 (3) 0.2% $1.625 09/27/04
5,625 (3) 0.6% $1.625 07/09/06
------ -----
25,125 2.6%
</TABLE>
(1) Realizable value represents the difference between the assumed
stock price at the expiration date and the exercise price
(2) Option was cancelled as part of option repricing
(3) Consists of Options granted on 2/12/97 in connection with
option repricing
<TABLE>
<CAPTION>
(Continuation of prior table)
Potential Reliazable
Value at Assumed
Annual Rates of Stock
Price Appreciation for
Option Term (1)
----------------------
Name 5%($) 10%($)
- ------------------- ---------- ----------
<S> <C> <C>
G.L.Resor, III $102,195 $258,983
35,472 88,372
5,426 12,836
9,577 22,029
7,307 16,710
10,750 24,467
12,069 29,103
--------- --------
182,796 452,500
W.C. Schneider 102,195 258,983
8,564 20,706
35,472 88,372
4,561 10,490
9,655 23,283
1,648 3,906
-------- -------
162,095 405,740
J.C. Plummer 7,297 16,784
8,564 20,706
3,256 7,701
9,655 23,283
-------- -------
28,772 68,474
Mark Lucas 102,195 258,983
1,098 2,604
14,682 35,496
3,621 8,731
35,473 88,373
------- -------
157,069 394,187
John L. Steele, Jr. 15,329 38,847
1,810 4,365
4,560 10,490
1,648 3,906
5,321 13,256
------- ------
28,668 70,864
</TABLE>
(1) Realizable value represents the difference between the assumed stock price
at the expiration date and the exercise price
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR-END FISCAL 1997 OPTION VALUES
The following tables show the number of shares remaining unexercised
by both "exercisable" (i.e., vested) and "unexercisable" (i.e., unvested)
stock options as of March 31, 1997. Also reported are the values of
"in-the-money" options which represent the positive spread between the
exercise price of any such existing stock options and the fiscal year-
end price of the Common Stock of $1.25.
<TABLE>
<CAPTION>
Option Values at March 31, 1997
- --------------------------------------------------------------
Shares Acquired
Name on Exercise (#) Value Realized ($)
- ---------------------- --------------- ------------------
<S> <C> <C>
Griffith L. Resor, III 20,000 $54,500
William C. Schneider 0 0
John C. Plummer 4,666 7,982
Mark Lucas 0 0
John L. Steele, Jr. 0 0
</TABLE>
<TABLE>
<CAPTION>
($) Value of Unexercised
(#) Number of Unexercised In-the Money Options
Options at March 31, 1997 at March 31, 1997
Name Exercisable Unexercisable Exercisable Unexercisable
- ------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
G.L. Resor, III 66,353 59,561 $ 3,733 0
W.C. Schneider 47,042 57,374 10,733 0
John C. Plummer 18,208 22,125 0 0
Mark Lucas 10,871 55,125 1,574 0
John L. Steele, Jr. 37,980 10,311 9,333 0
</TABLE>
OPTIONS REPRICED
The following table provides information relating to the repricing of
certain options held by the named officers of the Company that occurred
during the last ten fiscal years. There have been two occasions for
repricing the first repricing was on 8/21/95 with a one for one option
repricing, with no change in vesting. The second repricing which occurred
on 2/12/97 required the three for four exchange of options, with no change
to the vesting schedule. The Company has never granted, and thus has never
repriced, any stock appreciation rights.
<PAGE>
<TABLE>
<CAPTION>
Ten Year Option Repricing
Length of
Original
Option
term
Number of Market Remaining
Securities Price Exercise at
Underlying of Stock Price New Date of
Name Options at time of at time of Exercise Repricing
Date Repriced Repricing Repricing Price Yrs Days
- ---------- ------- --------- --------- -------- --- -----
G. L. Resor,III
<S> <C> <C> <C> <C> <C>
8/21/95 25,333 $6.375 $7.200 $6.375 7 220
8/21/95 16,666 $6.375 $9.600 $6.375 7 284
8/21/95 21,001 $6.375 $9.750 $6.375 7 363
8/21/95 10,000 $6.375 $8.000 $6.375 9 9
2/12/97 15,000 $1.625 $4.875 $1.625 8 89
2/12/97 18,999 $1.625 $6.375 $1.625 6 45
2/12/97 12,499 $1.625 $6.375 $1.625 6 109
2/12/97 15,750 $1.625 $6.375 $1.625 6 188
2/12/97 7,500 $1.625 $6.375 $1.625 7 200
2/12/97 37,500 $1.625 $3.250 $1.625 9 147
William C. Schneider
8/21/95 10,000 $6.375 $9.750 $6.375 7 363
8/21/95 3,000 $6.375 $8.250 $6.375 9 37
2/12/97 12,000 $1.625 $4.875 $1.625 8 89
2/12/97 10,500 $1.625 $4.875 $1.625 8 123
2/12/97 7,500 $1.625 $6.375 $1.625 6 188
2/12/97 2,250 $1.625 $6.375 $1.625 7 228
2/12/97 37,500 $1.625 $3.250 $1.625 9 147
John C. Plummer
8/21/95 16,000 $6.375 $9.750 $6.375 7 363
8/21/95 6,000 $6.375 $8.000 $6.375 9 9
2/12/97 12,000 $1.625 $4.875 $1.625 8 89
2/12/97 10,500 $1.625 $4.875 $1.625 8 123
2/12/97 12,000 $1.625 $6.375 $1.625 6 188
2/12/97 4,500 $1.625 $6.375 $1.625 7 200
Mark Lucas
8/21/95 2,000 $6.375 $8.250 $6.375 9 37
2/12/97 4,500 $1.625 $4.875 $1.625 8 89
2/12/97 18,000 $1.625 $4.875 $1.625 8 123
2/12/97 1,500 $1.625 $6.375 $1.625 7 228
2/12/97 37,500 $1.625 $3.250 $1.625 9 147
John L. Steele, Jr.
8/21/95 10,000 $6.375 $9.750 $6.375 7 363
8/21/95 3,000 $6.375 $8.250 $6.375 9 37
2/12/97 2,250 $1.625 $4.875 $1.625 8 89
2/12/97 7,500 $1.625 $6.375 $1.625 6 188
2/12/97 2,250 $1.625 $6.375 $1.625 7 228
2/12/97 5,625 $1.625 $3.250 $1.625 9 147
</TABLE>
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1997, the Compensation Committee consisted of Messrs.
Schechter, Craig and Haigh. No member of the Compensation Committee was
at any time during or prior to fiscal 1997 an officer or employee of the
Company.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE OFFICER COMPENSATION
The Compensation Committee
The Compensation Committee of the Company currently consists of two
Directors, Messrs. Schechter and Haigh, neither of whom is an officer or
employee of the Company. The Compensation Committee is responsible for
establishing compensation policies with respect to the Company's officers,
including the Chief Executive Officer and the other named officers, and
administering the Company's 1986 Stock Option Plan, the 1993 Stock Option
Plan, and the 1994 Employee Stock Purchase Plan the "Purchase Plan".
Compensation Committee Report on Repriced Options
In February 1997, the committee granted each of the Company's employees,
officers and select consultants who had previously been granted options
to purchase shares of Common Stock the right to exchange such options for
new stock options to purchase three shares for four shares surrendered of
Common Stock at a lower exercise price with the same vesting schedule the
"Option Exchange Offer". Options granted to Directors under the 1994
Plan were not subject to the Option Exchange Offer.
The majority of the Company's outstanding stock options contained
exercise prices that were substantially above the current market price
of the Common Stock. Although such options did have some financial value
based on a mathematical formula used in the investment banking community
for valuing options, the Committee believed that the Company's employees
did not place any value on options which were significantly out-of-the-
money. The Committee concluded that such options therefore were no longer
effective in either aligning the interests of the Company's employees
with those of its shareholders or encouraging option holders to remain
in the employ of the Company.
In determining to make the Option Exchange Offer, the Committee considered
the fairness of such exchange in relation to the Company's other share-
holders. The Committee concluded that, instead of issuing a large number
of new options at the current fair market value and thereby causing further
shareholder dilution, it was in the shareholders' long-term best interests
to make the Option Exchange Offer so that the Company could more effectively
motivate and retain its employees and officers. In this light, the
Committee decided that employees, officers and select consultants of the
Company should be given the option to exchange any of their outstanding
options for a new option to purchase the three shares for every four
surrendered with a new exercise price set at $1.625 (the fair market value
of the Company's Common Stock at the date of the Option Exchange Offer).
In August 1995, the committee granted each of the Company's employees
and officers who had previously been granted options to purchase shares
of Common Stock the right to exchange such options for new stock options
to purchase the same number of shares of Common Stock at a lower exercise
price with the same vesting schedule the "Option Exchange Offer". Options
granted to Directors under the 1994 Plan were not subject to the Option
Exchange Offer.
In determining to make the Option Exchange Offer, the Committee considered
the fairness of such exchange in relation to the Company's other share-
holders. The Committee concluded that, instead of issuing a large number
of new options at the current fair market value and thereby causing
further shareholder dilution, it was in the shareholders' long-term best
interests to make the Option Exchange Offer so that the Company could more
effectively motivate and retain its employees and officers. In this light,
the Committee decided that employees and officers of the Company should be
given the option to exchange any of their outstanding options for a new
option to purchase the same number of shares with a new exercise price
set at $6.375, (the fair market value of the Company's Common Stock at
the date of the Option Exchange Offer).
It is the opinion of the Compensation Committee that the Option Exchange
Offer succeeded in its objective of minimizing shareholder dilution and
providing strong incentives for the Company's employees and management.
Compensation for Fiscal 1997
The Compensation Committee seeks to achieve three broad goals in connection
with the Company's compensation programs and decisions regarding individual
compensation. First, the Compensation Committee structures executive
compensation programs in a manner that the Committee believes will enable
the Company to attract and retain key executives. Second, the Compensation
Committee establishes compensation programs that are designed to reward
executives for the achievement of specified business objectives of the
Company. By tying compensation in part to particular goals, the
Compensation Committee believes that a performance-oriented environment
is created for the Company's executives. Finally, the Company's
compensation programs are intended to provide executives with an equity
interest in the Company so as to link a portion of compensation with the
performance of the Company's Common Stock.
The compensation programs for the Company's officers established by the
Compensation Committee consist of four elements based upon the foregoing
objectives: base salary; fringe benefits; annual bonus; and equity
incentives, such as stock options issued under the Company's 1993 Stock
Option Plan. Additionally, as employees of the Company, each of the
Company's officers is eligible to participate in the Purchase Plan upon
the same terms as substantially all of the Company's other employees.
In establishing base salaries for executives, the Compensation Committee
monitors standards at comparable companies, particularly those that are
in the same or related industries and/or same general geographical area as
the Company, considers historic salary levels of the individual and the
nature of the individual's responsibilities and compares the individual's
base salary with those of other employees at the Company. To the extent
determined to be appropriate, the Compensation Committee also considers
general economic conditions and the Company's financial performance in
establishing base salaries of executives.
The Company provides or makes available generally competitive fringe
benefits, such as group life, medical, dental and disability insurance, a
401(k) investment plan, vacation days, holidays and short-term disability
coverage, for all employees. With the exception of individual term life
insurance coverage provided for the three founders of the Company, Messrs.
Resor, Schneider and Steele, since inception, no separate coverage or plans
of these types are provided or made available for officers. In cases where
officers' tax or financial planning is affected by restrictions on the
sales of stock of the Company by officers imposed by federal securities
laws and regulations, the Compensation Committee will consider whether some
reimbursement for related professional advice may be appropriate, although
no such reimbursements have been made to date.
The Compensation Committee generally structures bonuses by linking them to
the achievement of specified Company and/or business unit performance
objectives.
Fiscal 1997 Compensation for the Chief Executive Officer
In considering the compensation for the Chief Executive Officer for fiscal
1997, the Compensation Committee considered the same criteria as for the
compensation of the other officers of the Company. Mr. Resor was paid a
base salary for fiscal 1997 of $165,577. In addition, Mr. Resor received
stock options to purchase 50,000 shares of Common Stock which were
exchanged in the 2/12/97 repricing for 37,500 shares.
/s/ ROBERT P. SCHECHTER
/s/ RONALD K. HAIGH
CERTAIN TRANSACTIONS
Compliance with Section 16(a) of the Exchange Act Under the securities
laws of the United States, the Company's directors, its executive (and
certain other) officers and any persons holding more than ten percent of
the Company's Common Stock are required to report their ownership of the
Common Stock and any changes in that ownership to the Securities and
Exchange Commission (the "Commission"). Specific due dates for these
reports have been established by the Commission and the Company is required
to report in this Proxy Statement any failure during fiscal 1997 to file
by these dates. With the exception of one Form 4 filing which was late,
all of these filing requirements were timely satisfied by its directors,
officers and ten percent holders. In making this statement, the Company
has relied upon the written representations of its directors, officers and
ten percent holders and copies of the reports that have been filed with the
Company.
STOCKHOLDER RETURN PERFORMANCE GRAPH
The following table of data was used to produce the graph which provides
information that compares the performance of the Company's Common Stock to
the Nasdaq Stock Market Total Return Index for U.S. Companies and the
Nasdaq Total Return Index for Computer Manufacturers since the Company's
initial public offering on July 23, 1993. The Nasdaq Total Return Index
for Computer Manufacturers includes both manufacturers of large, complex,
capital equipment and many of the Company's customers. The data assumes
that the value of the investment in the Company's Common Stock and each
index was $100 at July 23, 1993 and that all dividends were reinvested.
<PAGE>
<TABLE>
<CAPTION>
End of Trading on
July 23, 1993
and Last Day of
Each Quarter Nasdaq
Through End Stock Computer
of Fiscal Year MRS Technology Inc. Market(US) Mfgrs.
- --------------- ------------------ ---------- ----------
<S> <C> <C> <C>
07/23/93 100.000 100.000 100.000
09/30/93 178.571 109.003 98.560
12/31/93 185.714 111.144 114.824
03/31/94 142.857 106.472 111.323
06/30/94 121.429 101.495 90.256
09/30/94 117.857 109.898 109.738
12/30/94 100.000 108.645 126.103
03/31/95 96.429 118.441 132.931
06/30/95 75.000 135.476 161.651
09/29/95 71.429 151.793 194.488
12/29/95 46.429 153.645 198.618
03/29/96 82.143 160.813 204.734
06/28/96 53.571 173.941 230.167
09/30/96 41.071 180.123 254.117
12/31/96 30.357 188.951 266.691
03/31/97 17.857 178.737 224.325
</TABLE>
The Indexes and graph were prepared by the Center for Research
in Security Prices at the University of Chicago Graduate School of
Business.
ITEM 2. SELECTION OF AUDITORS
The Board of Directors recommends that the stockholders ratify its
appointment of Coopers & Lybrand L.L.P., independent public accountants,
as the independent auditors of the Company for the fiscal year ending
March 31, 1998. Coopers & Lybrand L.L.P. has acted in such capacity for
the Company since the Company's 1986 fiscal year.
A representative of Coopers & Lybrand L.L.P. will be present at the
meeting and will be afforded the opportunity to make a statement and to
respond to appropriate questions.
VOTE REQUIRED
The affirmative vote of the holders of a majority of the shares of
Common Stock present or represented at the meeting is required to approve
the selection of Coopers & Lybrand L.L.P. as the Company's auditors for
the fiscal year ending March 31, 1998. Unless authority is withheld,
it is the intention of the persons voting the enclosed proxy to vote
such proxy in favor of approving the selection of Coopers & Lybrand L.L.P.
as the Company's auditors. If the proposal to approve the selection of
Coopers & Lybrand L.L.P. is not approved, the Board of Directors will
select and appoint another independent accounting firm for the fiscal
year ending March 31, 1998 without further stockholder action.
<PAGE>
ITEM 3. OTHER BUSINESS
The Board of Directors knows of no other business which will be presented
for consideration at the Annual Meeting other than as stated in the Notice
of Meeting. If any other business properly comes before the meeting, it
is the intention of the persons named in the enclosed proxy to vote or
otherwise act in accordance with their best judgment on such matters.
STOCKHOLDER PROPOSALS
Any stockholder of the Company may present a proposal for consideration at
future meetings of the stockholders of the Company. Any proposal for
consideration at next year's meeting of stockholders must be received by
the Company at its principal executive offices, 10 Elizabeth Drive,
Chelmsford, Massachusetts, 01824, Attention: John L. Steele, Jr.,
Secretary, no later than February 13, 1998, except that if the next year's
annual meeting date is changed by more than 30 calendar days from the
regularly scheduled date, July 29, 1998, the Company must receive such
a proposal within a reasonable time before the Board of Directors makes
its proxy solicitation.
ADDITIONAL FINANCIAL INFORMATION
Copies of the Company's Annual Report on Form 10-K (without exhibits) as
filed with the Securities and Exchange Commission will be furnished without
charge upon written request of any stockholder of record. Requests for
such copies should be directed to: John L. Steele, Jr., Secretary,
MRS Technology, Inc., 10 Elizabeth Drive, Chelmsford, MA 01824.
John L. Steele, Jr., Secretary
June 6, 1997
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING, PLEASE SEND IN YOUR
PROXY WITHOUT DELAY. PROMPT RESPONSE IS HELPFUL AND YOUR COOPERATION WILL BE
APPRECIATED. ANY STOCKHOLDER GIVING A PROXY MAY REVOKE IT AT ANY TIME IF IT
HAS NOT BEEN VOTED.
<PAGE>
PROXY MRS TECHNOLOGY, INC. PROXY
10 Elizabeth Drive
Chelmsford, MA 01824
Annual Meeting of Stockholders
Wednesday, July 30, 1997
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Griffith L.Resor III and John L. Steele,Jr.,
or any of them, as proxies, each with full power of substitution to vote,
in the manner directed by the undersigned, all shares of stock which the
undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders of MRS Technology, Inc. To be held at the BankBoston
auditorium Blue Hills Office Park, 150 Royall Street, Canton, Massachusetts,
on Wednesday, July 30, 1997, at 10:00 a.m. or at any adjournment thereof.
Please return this card in the enclosed postage paid envelope to The
BankBoston, P.O.Box 1628, Boston, MA 02105.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE -- SEE REVERSE SIDE
[X] Please mark votes as in this example.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED IN FAVOR OF THE
PROPOSALS SET FORTH BELOW.
1. To elect Carl P. Herrmann to the Board of Directors to serve as
Class II Director for a three-year term.
[ ] FOR [ ] WITHHELD
2. To ratify the appointment of Coopers & Lybrand L.L.P. as auditors
for the fiscal year ending March 31, 1998.
[ ] FOR [ ] WITHHELD [ ] ABSTAIN
3. In their discretion to vote upon such other business as may properly
come before this meeting and any adjournment thereof.
[ ] MARK HERE FOR ADDRESS CHANGE NOTED BELOW
Please sign exactly as name appears hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by the President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
Signature:----------------------------- Date:----------------
Signature:----------------------------- Date:----------------
