<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss 240.14a-11(c) or ss 240.14a-12
Asyst Technologies, Inc.
------------------------
(Name of Registrant as Specified In Its Charter)
Asyst Technologies, Inc.
------------------------
(Name of Person(s) Filing Proxy Statement)
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:
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2. Aggregate number of securities to which transaction applies:
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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):(1)
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4. Proposed maximum aggregate value of transaction:
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5. Total fee paid:
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[ ] 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:
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2. Form, Schedule or Registration Statement No.:
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4. Date Filed:
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ASYST TECHNOLOGIES, INC.
48761 Kato Road
Fremont, CA 94538
----------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 29, 1997
----------------
TO THE SHAREHOLDERS OF ASYST TECHNOLOGIES, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Asyst
Technologies, Inc., a California corporation (the "Company"), will be held on
Monday, September 29, 1997, at 3:00 p.m. local time at the Beverly Heritage
Hotel, 1820 Barber Lane, Milpitas, California, for the following purpose:
1. To elect directors to serve for the ensuing year and until their
successors are elected.
2. To approve the Company's 1993 Stock Option Plan, as amended, to increase
the aggregate number of shares of Common Stock authorized for issuance
under such plan by 500,000 shares and to add provisions with respect to
Section 162(m) of the Internal Revenue Code of 1986, as amended.
3. To approve the Company's 1993 Non-Employee Directors' Stock Option Plan,
as amended, to increase the aggregate number of Shares of Common Stock
authorized for issuance under such plan by 150,000 shares and to
increase the size of the initial options to purchase Common Stock
granted thereunder to 14,000 shares.
4. To ratify the selection of Arthur Andersen LLP as independent auditors
of the Company for its fiscal year ending March 31, 1998.
5. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
The Board of Directors has fixed the close of business on August 21, 1997,
as the record date for the determination of shareholders entitled to notice of
and to vote at this Annual Meeting and at any adjournment or postponement
thereof.
By Order of the Board of Directors
/s/ JAMES C. KITCH
James C. Kitch
Secretary
Fremont, California
August 25, 1997
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE,
SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO
ENSURE YOUR REPRESENTATION AT THE MEETING. A RETURN ENVELOPE (WHICH IS
POSTAGE PREPAID IF MAILED IN THE UNITED STATES) IS ENCLOSED FOR THAT
PURPOSE. EVEN IF YOU HAVE GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON
IF YOU ATTEND THE MEETING. PLEASE NOTE, HOWEVER, THAT IF YOUR SHARES ARE
HELD OF RECORD BY A BROKER, BANK OR OTHER NOMINEE AND YOU WISH TO VOTE AT
THE MEETING, YOU MUST OBTAIN FROM THE RECORD HOLDER A PROXY ISSUED IN YOUR
NAME.
<PAGE>
ASYST TECHNOLOGIES, INC.
48761 Kato Road
Fremont, CA 94538
----------------
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
September 29, 1997
----------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of Asyst
Technologies, Inc., a California corporation (the "Company"), for use at the
Annual Meeting of Shareholders to be held on Monday, September 29, 1997, at
3:00 p.m. local time (the "Annual Meeting"), or at any adjournment or
postponement thereof, for the purposes set forth herein and in the
accompanying Notice of Annual Meeting. The Annual Meeting will be held at the
Beverly Heritage Hotel, 1820 Barber Lane, Milpitas, California. The Company
intends to mail this proxy statement and accompanying proxy card on or about
August 26, 1997 to all shareholders entitled to vote at the Annual Meeting.
SOLICITATION
The Company will bear the entire cost of solicitation of proxies, including
preparation, assembly, printing and mailing of this proxy statement, the proxy
and any additional information furnished to shareholders. Copies of
solicitation materials will be furnished to banks, brokerage houses,
fiduciaries and custodians holding in their names shares of Common Stock
beneficially owned by others to forward to such beneficial owners. The Company
may reimburse persons representing beneficial owners of Common Stock for their
costs of forwarding solicitation materials to such beneficial owners. Original
solicitation of proxies by mail may be supplemented by telephone, telegram or
personal solicitation by directors, officers or other regular employees of the
Company or at the Company's request. No additional compensation will be paid
to directors, officers or other regular employees for such services but
Corporate Investor Communications, Inc. will be paid its customary fee,
estimated to be about $4,000, if it renders solicitation services.
VOTING RIGHTS AND OUTSTANDING SHARES
Only holders of record of Common Stock at the close of business on August
21, 1997 will be entitled to notice of and to vote at the Annual Meeting. At
the close of business on August 21, 1997 the Company had outstanding and
entitled to vote 10,798,762 shares of Common Stock. All shares numbers in this
proxy statement are adjusted to reflect the 2-for-1 stock split which was
declared by the Board of Directors in the form of a 100% stock dividend paid
on August 22, 1997 to holders of Common Stock on August 1, 1997.
Each holder of record of Common Stock on such date will be entitled to one
vote for each share held on all matters to be voted upon at the Annual Meeting
All votes will be tabulated by the inspector of election appointed for the
meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions and broker non-votes are counted
towards a quorum but are not counted for any purpose in determining whether a
matter is approved.
<PAGE>
REVOCABILITY OF PROXIES
Any person giving a proxy pursuant to this solicitation has the power to
revoke it at any time before it is voted. It may be revoked by filing with the
Secretary of the Company at the Company's principal executive office, 48761
Kato Road, Fremont, CA 94538, a written notice of revocation or a duly
executed proxy bearing a later date, or it may be revoked by attending the
meeting and voting in person. Attendance at the meeting will not, by itself,
revoke a proxy.
SHAREHOLDER PROPOSALS
Proposals of shareholders that are intended to be presented at the Company's
1998 Annual Meeting of Shareholders must be received by the Company not later
than April 17, 1998 in order to be included in the proxy statement and proxy
relating to that Annual Meeting.
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<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
There are six nominees for the Board positions presently authorized in the
Company's Bylaws. Each director to be elected will hold office until the next
annual meeting of shareholders and until his successor is elected and has
qualified, or until such director's earlier death, resignation or removal.
Each nominee listed below is currently a director of the Company, four
directors having been elected by the shareholders and two directors, Stanley
Grubel and Ashok Sinha having been elected by the Board.
Shares represented by executed proxies will be voted, if authority to do so
is not withheld, for the election of the six nominees named below. In the
event that any nominee should be unavailable for election as a result of an
unexpected occurrence, such shares will be voted for the election of such
substitute nominee as management may propose. Proxies cannot be voted for a
greater number of persons than the number of nominees named. Each person
nominated for election has agreed to serve if elected and management has no
reason to believe that any nominee will be unable to serve.
The six candidates receiving the highest number of affirmative votes cast at
the meeting will be elected directors of the Company.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF EACH NAMED NOMINEE.
NOMINEES
The names of the nominees and certain information about them are set forth
below:
<TABLE>
<CAPTION>
NAME AGE PRINCIPAL OCCUPATION
---- --- --------------------
<C> <C> <S>
Mihir Parikh 50 Chairman of the Board and Chief Executive Officer of
the Company
Stanley Grubel 55 Chief Executive Officer of MiCRUS
Tsuyoshi Kawanishi 67 Senior Advisor of Toshiba Corporation
Ashok K. Sinha 53 President of the Metal Deposition Product Business
Group of Applied Materials, Inc.
James E. Springgate 70 Independent Consultant
Walter W. Wilson 53 President of Solectron California Corporation
</TABLE>
Dr. Parikh has served as Chairman of the Board and Chief Executive Officer
of the Company since July 1992. He has been a director of the Company since he
founded the Company in 1984 and served as the Company's President and Chief
Executive Officer from its inception to July 1992.
Mr. Grubel has served as a director of the Company since January 1997. Mr.
Grubel has served as Chief Executive Officer of MiCRUS, a manufacturer of C-
mos wafers since September 30, 1994. Between January 1, 1992 a September 29,
1994, he was a plant manager for International Business Machines Corporation.
Mr. Kawanishi has served as a director of the Company since February 1996.
He has served as Senior Adviser of Toshiba Corporation ("Toshiba"), a
manufacturer of electronic machinery and semiconductors, since June 1994. He
previously held the position of Senior Executive Vice President at Toshiba
from June 1990 to June 1994. Mr. Kawanishi also sits on the board of Applied
Materials, Inc. and Chartered Semiconductor Manufacturing Ltd. He is also
president of Japan's Society for Hybrid Microelectronics and Chairman of the
Board of Singapore's Institute for Microelectronics.
3
<PAGE>
Dr. Sinha has served as a director of the Company since January 1997. Dr.
Sinha has served as Group Vice President of Applied Materials, Inc., a
semiconductor equipment manufacturer, since 1990 and is President of the Metal
Deposition Product Business Group of Applied Materials, Inc.
Mr. Springgate has served as a director of the Company since June 1985. Mr.
Springgate is currently an independent consultant. From 1975 until his
retirement in 1989, he was the President of Monsanto Electronic Materials
Company, a unit of Monsanto Company, a producer of chemicals and
pharmaceuticals.
Mr. Wilson has served as a director of the Company since January 1995. Mr.
Wilson has served as President of Solectron North America, a wholly-owned
subsidiary of Solectron Corporation, a provider of manufacturing services to
the electronics industry ("Solectron"), since September 1995, as President of
Solectron California Corporation since September 1993 and as a Senior Vice
President, Operations of Solectron since June 1990.
There are no family relationships among any of the directors or executive
officers of the Company.
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended March 31, 1997, the Board of Directors held
four meetings. The Board's committees include an Audit Committee and a
Compensation Committee.
The Audit Committee meets with the Company's independent auditors at least
annually to review the results of the annual audit and discuss the financial
statements; recommends to the Board the independent auditors to be retained;
and receives and considers the accountants' comments as to controls, adequacy
of staff and management performance and procedures in connection with audit
and financial controls. The Audit Committee is composed of two non-employee
directors: Messrs. Springgate and Wilson. It met five times during such fiscal
year.
The Compensation Committee makes recommendations concerning salaries and
incentive compensation, awards stock options to employees and consultants
under the Company's stock option plans and otherwise determines compensation
levels and performs such other functions regarding compensation as the Board
may delegate. The Compensation Committee is composed of two non-employee
directors: Messrs. Springgate and Sinha. It did not meet during such fiscal
year.
During the fiscal year ended March 31, 1997, each Board member attended 75%
or more of the aggregate of the meetings of the Board and of the committees on
which he served, held during the period for which he was a director or
committee member, respectively.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF EACH NAMED NOMINEE
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<PAGE>
PROPOSAL 2
APPROVAL OF THE 1993 STOCK OPTION PLAN, AS AMENDED
In June 1993, the Board of Directors adopted, and the shareholders
subsequently approved, the Company's 1993 Stock Option Plan (the "1993 Plan").
As a result of a series of amendments, at September 1996 there were 2,100,000
shares of the Company's Common Stock authorized for issuance under the 1993
Plan.
At June 30, 1997, options (net of canceled or expired options) covering an
aggregate of 1,753,370 shares of the Company's Common Stock had been granted
under the 1993 Plan, and only 33,894 shares (plus any shares that might in the
future be returned to the plans as a result of cancellations or expiration of
options) remained available for future grant under the 1993 Plan. During the
last fiscal year, under the 1993 Plan, the Company granted to all current
executive officers as a group options to purchase 310,000 shares at exercise
prices of $10.125 to $10.84375 per share and to all employees (excluding
executive officers) as a group options to purchase 793,044 shares at exercise
prices of $8.375 to $11.00 per share. Each Named Executive Officer received
options as set forth in the table on page 20.
In July 1997, the Board approved an amendment to the 1993 Plan, subject to
shareholder approval, to enhance the flexibility of the Board and the
Compensation Committee in granting stock options to the Company's employees.
The amendment increases the number of shares authorized for issuance under the
1993 Plan from a total of 2,100,000 shares to 2,600,000 shares. The Board
adopted this amendment to ensure that the Company can continue to grant stock
options to employees at levels determined appropriate by the Board and the
Compensation Committee.
Also in July 1997, the Board amended the 1993 Plan to modify the
requirements related to shareholder approval of amendments to the 1993 Plan to
bring the 1993 Plan into conformity with and take advantage of new regulations
under Section 16 of the Exchange Act. Furthermore, the Board amended the 1993
Plan, subject to shareholder approval, generally to permit the Company, under
Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code"),
to continue to be able to deduct as a business expense certain compensation
attributable to the exercise of stock options granted under the 1993 Plan.
Section 162(m) denies a deduction to any publicly held corporation for certain
compensation paid to specified employees in a taxable year to the extent that
the compensation exceeds $1,000,000 for any covered employee. See "Federal
Income Tax Information" below for a discussion of the application of Section
162(m). In light of the Section 162(m) requirements, the Board has amended the
1993 Plan, subject to shareholder approval, to include a limitation providing
that no employee may be granted options under the 1993 Plan during a calendar-
year to purchase in excess of 200,000 shares of Common Stock. Previously, no
such formal limitation was placed on the number of shares available for option
grants to any individual.
Shareholders are requested in this Proposal 2 to approve the 1993 Plan, as
amended. If the shareholders fail to approve this Proposal 2, options granted
under the 1993 Plan after the Annual Meeting will not qualify as performance-
based compensation and, in some circumstances, the Company may be denied a
business expense deduction for compensation recognized in connection with the
exercise of such options. The affirmative vote of the holders of a majority of
the shares present in person or represented by proxy and voting at the meeting
will be required to approve the 1993 Plan, as amended. For purposes of this
vote, abstentions and broker non-votes will not be counted for any purpose in
determining whether this matter has been approved.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 2.
5
<PAGE>
The description of the essential features of the 1993 Plan outlined below is
qualified in its entirety by reference to the 1993 Plan.
GENERAL
The 1993 Plan provides for the grant of both incentive and nonstatutory
stock options. Incentive stock options granted under the 1993 Plan are
intended to qualify as "incentive stock options" within the meaning of Section
422 of the Internal Revenue Code of 1986, as amended (the "Code").
Nonstatutory stock options granted under the 1993 Plan are intended not to
qualify as incentive stock options under the Code. See "Federal Income Tax
Information" for a discussion of the tax treatment of incentive and
nonstatutory stock options.
PURPOSE
The 1993 Plan was adopted to provide a means by which officers and employees
of and consultants to the Company and its affiliates could be given an
opportunity to purchase stock in the Company, to assist in retaining the
services of employees holding key positions, to secure and retain the services
of persons capable of filling such positions and to provide for such persons
to exert maximum efforts for the success of the Company. Approximately 210 of
the Company's approximately 540 employees and consultants are eligible to
participate in the 1993 Plan.
ADMINISTRATION
The 1993 Plan is administered by the Board of Directors of the Company. The
Board has the power to construe and interpret the 1993 Plan and, subject to
the provisions of the 1993 Plan, to select the persons to whom grants are to
be made, to designate the number of shares to be covered by each option, to
determine whether an option is an incentive stock option or a nonstatutory
stock option, to establish vesting schedules, to specify the exercise price
and the type of consideration to be paid to the Company upon exercise, and,
subject to certain restrictions, to specify any other terms. The Board of
Directors is authorized to delegate administration of the 1993 Plan to a
committee composed of not fewer than two members of the Board. The 1993 Plan
provides that in the Board's discretion, directors serving on the Compensation
Committee will also be "non-employee directors" within the meaning of Rule
16b-3 promulgated under the Exchange Act ("Rule 16b-3") or "outside directors"
within the meaning of Section 162(m) of the Code. The Board has delegated
administration of the 1993 Plan to the Compensation Committee of the Board. As
used herein with respect to the 1993 Plan, the "Board" refers to the
Compensation Committee as well as to the Board of Directors itself.
ELIGIBILITY
Incentive stock options may be granted under the 1993 Plan only to employees
(including officers and directors) of the Company and its affiliates.
Employees (including officers and directors) and consultants are eligible to
receive nonstatutory stock options under the 1993 Plan. Directors who are not
employees of the Company are not eligible to receive any option grants under
the 1993 Plan.
Subject to shareholder approval of this Proposal 2, the Company has added to
the 1993 Plan a per-individual, per-calendar year period limitation equal to
200,000 shares of Common Stock. The purpose of adding this limitation is
generally to permit the Company to continue to be able to deduct for tax
purposes the compensation attributable to the exercise of options granted
under the 1993 Plan. Previously, the Board or the Compensation Committee
determined in its discretion the number of shares subject to an option for any
individual and no such formal limitation was placed on the number of shares
available for grant to any individual. To date, the Company has not granted to
any individual in any calendar year options to purchase a number of shares
equal to or in excess of the limitation.
No incentive stock option may be granted under the 1993 Plan to any person
who, at the time of the grant, owns (or is deemed to own) stock possessing
more than 10% of the total combined voting power of all classes of stock of
the Company or any affiliate of the Company, unless the option exercise price
of such option is at least 110% of the fair market value of the stock subject
to the option on the date of grant, and the term of the option does not exceed
five years from the date of grant. For incentive stock options granted under
the 1993
6
<PAGE>
Plan, the aggregate fair market value, determined at the time of grant, of the
shares of Common Stock with respect to which such options are exercisable for
the first time by an optionee during any calendar year (under all such plans
of the Company and its affiliates) may not exceed $100,000.
STOCK SUBJECT TO THE 1993 PLAN
If options granted under the 1993 Plan expire or otherwise terminate without
being exercised, the Common Stock not purchased pursuant to such options again
becomes available for issuance under the 1993 Plan.
TERMS OF OPTIONS
The following is a description of the permissible terms of options under the
1993 Plan. Individual option grants may be more restrictive as to any or all
of the permissible terms described below.
Exercise Price; Payment. The exercise price of incentive stock options under
the 1993 Plan may not be less than the fair market value of the Common Stock
subject to the option on the date of the option grant, and in some cases (see
"Eligibility" above), may not be less than 110% of such fair market value. The
exercise price of nonstatutory stock options under the 1993 Plan may not be
less than 85% of the fair market value of the Common Stock subject to the
option on the date of the option grant. However, if options were granted with
exercise prices below fair market value, deductions for compensation
attributable to the exercise of such options could be limited by Section
162(m) of the Code. See "Federal Income Tax Information." In the event of a
decline in the value of the Company's Common Stock, the Board has the
authority to offer employees the opportunity to replace outstanding higher
priced options, whether incentive or nonstatutory, with new lower priced
options. At August 15, 1997, the closing price of the Company's Common Stock
as reported on the Nasdaq National Market was $21.625 per share.
In the event of a decline in the value of the Company's Common Stock, the
Board has the authority to offer employees the opportunity to replace
outstanding higher priced options, whether incentive or nonstatutory, with new
lower priced options. To the extent required by Section 162(m) of the Code, an
option repriced under the 1993 Plan is deemed to be canceled and a new option
granted. Both the option deemed to be canceled and the new option deemed to be
granted will be counted against the 200,000 share limitation.
The exercise price of options granted under the 1993 Plan must be paid
either: (i) in cash at the time the option is exercised; or (ii) at the
discretion of the Board, (a) by delivery of other Common Stock of the Company,
(b) pursuant to a deferred payment arrangement or (c) in any other form of
legal consideration acceptable to the Board.
Transferability. Under the 1993 Plan, an incentive stock option may not be
transferred by the optionee otherwise than by will or by the laws of descent
and distribution and may be exercised only by the optionee during the lifetime
of an optionee. A nonstatutory stock option may not be transferred except by
will or by the laws of descent and distribution unless otherwise specified in
the option agreement, in which case the nonstatutory stock option may be
transferred upon such terms and conditions as set forth in the option,
including pursuant to a domestic relations order. In any case, the optionee
may designate in writing a third party who may exercise the option in the
event of the optionee's death.
Option Exercise. Options granted under the 1993 Plan may become exercisable
in cumulative increments ("vest") as determined by the Board. The Board has
the power to accelerate the time during which an option may be exercised. In
addition, options granted under the 1993 Plan may permit early exercise prior
to vesting, but in such event the optionee may be required to enter into an
early exercise stock purchase agreement that allows the Company to repurchase
shares not yet vested at their exercise price should the optionee leave the
employment of the Company before vesting. To the extent provided by the terms
of an option, an optionee may satisfy any federal, state or local tax
withholding obligation relating to the exercise of such option by a cash
payment upon exercise, by authorizing the Company to withhold a portion of the
stock otherwise issuable to the optionee, by delivering already-owned stock of
the Company or by a combination of these means.
7
<PAGE>
Term. The maximum term of options under the 1993 Plan is ten years, except
that in certain cases (see "Eligibility") the maximum term is five years.
Options under the 1993 Plan terminate three months after termination of the
optionee's employment or relationship as a consultant or director of the
Company or any affiliate of the Company, unless (i) such termination of
employment is due to such person's permanent and total disability (as defined
in the Internal Revenue Code (the "Code")), in which case the option may, but
need not, provide that it may be exercised at any time within one year of such
termination; (ii) the optionee dies while employed by or serving as a
consultant or director of the Company or any affiliate of the Company, or
within three months after termination of such relationship, in which case the
option may, but need not, provide that it may be exercised (to the extent the
option was exercisable at the time of the optionee's death) within twelve
months of the optionee's death by the person or persons to whom the rights to
such option pass by will or by the laws of descent and distribution; or (iii)
the option by its terms specifically provides otherwise. Individual options by
their terms may provide for exercise within a longer period of time following
termination of employment or the consulting or director relationship. The
option term may also be extended in the event that exercise of the option
within these periods is prohibited for specified reasons.
ADJUSTMENT PROVISIONS
If there is any change in the stock subject to the 1993 Plan or subject to
any option granted under the 1993 Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange
of shares, change in corporate structure or otherwise), the 1993 Plan and the
options outstanding thereunder will be appropriately adjusted as to the class
and the maximum number of shares and price per share of stock subject to the
1993 Plan and such outstanding options.
EFFECT OF CERTAIN CORPORATE EVENTS
The 1993 Plan provides that, in the event of a dissolution or liquidation of
the Company, specified type of merger or other corporate reorganization, to
the extent permitted by law, any surviving corporation will be required to
either assume any options outstanding under the 1993 Plan or substitute
similar options for those outstanding under such plan, or such outstanding
options will continue in full force and effect. In the event that any
surviving corporation declines to assume or continue the options outstanding
under the 1993 Plan, or to substitute similar options, then, with respect to
options held by persons then performing services as employees or as
consultants or directors for the Company, as the case may be, the time during
which such options may be exercised will be accelerated and the options
terminated if not exercised during such time. The acceleration of an option in
the event of an acquisition or similar corporate event may be viewed as an
antitakeover provision, which may have the effect of discouraging a proposal
to acquire or otherwise obtain control of the Company.
DURATION, AMENDMENT AND TERMINATION
The Board may suspend or terminate the 1993 Plan without shareholder
approval or ratification at any time or from time to time. Unless sooner
terminated, the 1993 Plan will terminate in June 2003.
The Board may also amend the 1993 Plan at any time or from time to time.
However, no amendment will be effective unless approved by the shareholders of
the Company within twelve months of its adoption by the Board if the amendment
would require shareholder approval in order for the 1993 Plan to comply with
Rule 16b-3 or satisfy the requirements of Section 422 of the Code or any
Nasdaq National Market requirement. Subject to the foregoing, the Board may
amend the 1993 Plan in any respect the Board deems necessary or advisable to
provide optionees with the maximum benefits available under the Code or to
bring the 1993 Plan or any option granted thereunder into compliance with the
Code.
8
<PAGE>
FEDERAL INCOME TAX INFORMATION
Incentive Stock Options. Incentive stock options under the 1993 Plan are
intended to be eligible for the favorable federal income tax treatment
accorded "incentive stock options" under the Code.
There generally are no federal income tax consequences to the optionee or
the Company by reason of the grant or exercise of an incentive stock option.
However, the exercise of an incentive stock option may increase the optionee's
alternative minimum tax liability, if any.
If an optionee holds stock acquired through exercise of an incentive stock
option for at least two years from the date on which the option is granted and
at least one year from the date on which the shares are transferred to the
optionee upon exercise of the option, any gain or loss on a disposition of
such stock will be long-term capital gain or loss. Generally, if the optionee
disposes of the stock before the expiration of either of these holding periods
(a "disqualifying disposition"), at the time of disposition, the optionee will
realize taxable ordinary income equal to the lesser of (a) the excess of the
stock's fair market value on the date of exercise over the exercise price, or
(b) the optionee's actual gain, if any, on the purchase and sale. The
optionee's additional gain, or any loss, upon the disqualifying disposition
will be a capital gain or loss which will be long-term or short-term depending
on whether the stock was held for more than one year. Long-term capital gains
currently are generally subject to lower tax rates than ordinary income. The
maximum capital gains rate for federal income tax purposes is currently 28%
while the maximum ordinary income rate is effectively 39.6% at the present
time. Slightly different rules may apply to optionees who acquire stock
subject to certain repurchase options or who are subject to Section 16(b) of
the Exchange Act.
Congress and the President are currently finalizing the details in balanced
budget legislation which would have a significant impact on federal tax law
and in particular the rates and terms of the capital gains tax discussed
herein. Adoption of the current budget agreement would likely make the earlier
exercise of stock options granted by the Company look more attractive for
individuals who are seeking to minimize their potential tax liability
associated with those stock options. However, such an outcome remains
uncertain until new laws are actually approved and enacted.
To the extent the optionee recognizes ordinary income by reason of a
disqualifying disposition, the Company will generally be entitled (subject to
the requirement of reasonableness, the provisions of Section 162(m) of the
Code and the satisfaction of a tax reporting obligation) to a corresponding
business expense deduction in the tax year in which the disqualifying
disposition occurs.
Nonstatutory Stock Options. Nonstatutory stock options granted under the
1993 Plan generally have the following federal income tax consequences:
There are no tax consequences to the optionee or the Company by reason of
the grant of a nonstatutory stock option. Upon exercise of a nonstatutory
stock option, the optionee normally will recognize taxable ordinary income
equal to the excess of the stock's fair market value on the date of exercise
over the option exercise price. Generally, with respect to employees, the
Company is required to withhold from regular wages or supplemental wage
payments an amount based on the ordinary income recognized. Subject to the
requirement of reasonableness, the provisions of Section 162(m) of the Code
and the satisfaction of tax reporting obligation, the Company will generally
be entitled to a business expense deduction equal to the taxable ordinary
income realized by the optionee. Upon disposition of the stock, the optionee
will recognize a capital gain or loss equal to the difference between the
selling price and the sum of the amount paid for such stock plus any amount
recognized as ordinary income upon exercise of the option. Such gain or loss
will be long or short-term depending on whether the stock was held for more
than one year. Slightly different rules may apply to optionees who acquire
stock subject to certain repurchase options or who are subject to Section
16(b) of the Exchange Act.
Potential Limitation on Company Deductions. As part of the Omnibus Budget
Reconciliation Act of 1993, the U.S. Congress amended the Code to add Section
162(m) which denies a deduction to any publicly held corporation for
compensation paid to certain employees in a taxable year to the extent that
compensation exceeds
9
<PAGE>
$1 million for a covered employee. It is possible that compensation
attributable to stock options, when combined with all other types of
compensation received by a covered employee from the Company, may cause this
limitation to be exceeded in any particular year.
Certain kinds of compensation, including qualified "performance-based
compensation," are disregarded for purposes of the deduction limitation. In
accordance with proposed Treasury regulations issued under Code Section
162(m), compensation attributable to stock options will qualify as
performance-based compensation, provided that the option is granted by a
compensation committee comprised solely of "outside directors" and either: (i)
the option plan contains a per-employee limitation on the number of shares for
which options may be granted during a specified period, (ii) the per-employee
limitation is approved by the shareholders; (iii) the award is granted by a
compensation committee compromised solely of two or more "outside directors;"
and (iv) the exercise price of the option is no less than the fair market
value of the stock on the date of grant.
10
<PAGE>
PROPOSAL 3
APPROVAL OF THE 1993 NON-EMPLOYEE DIRECTORS'
STOCK OPTION PLAN, AS AMENDED
In June 1993, the Board of Directors adopted, and the shareholders
subsequently approved, the Company's 1993 Non-Employee Directors' Stock Option
Plan (the "Directors' Plan") and reserved a total of 100,000 shares of the
Company's Common Stock under the Directors' Plan.
In January 1997, the Board of Directors approved an amendment to the
Directors' Plan, subject to shareholder approval, to increase the number of
shares authorized under the Directors' Plan from 100,000 shares to 250,000
shares and to increase the number of shares underlying options granted upon a
non-employee directors' initial election to the Board of Directors from 10,000
shares to 14,000. The Board approved these amendments to ensure that the
Company continues to attract, retain and reward non-employee directors by
compensating them at levels deemed appropriate by the Board.
At June 30, 1997, options (net of canceled or expired options) covering all
of the 100,000 shares currently authorized under the Directors' Plan had been
granted (other than shares that might in the future be returned to the plan as
a result of cancellation or expiration of options). Options covering an
additional 9,000 shares have been granted, subject to shareholder approval.
See "Executive Compensation--Compensation of Directors."
Shareholders are requested in this Proposal 3 to approve the Directors'
Plan, as amended. The affirmative vote of the holders of a majority of the
shares present in person or represented by proxy and voting at the meeting
will be required to approve the Directors' Plan, as amended. For purposes of
this vote, abstentions and broker non-votes will not be counted for any
purpose in determining whether this matter has been approved.
MANAGEMENT RECOMMENDS A VOTE IN FAVOR OF PROPOSAL 3.
11
<PAGE>
The essential features of the Directors' Plan are outlined below:
GENERAL
The Directors' Plan provides for the non-discretionary grant of nonstatutory
stock options to members of the Board of Directors who are not employees of
the Company. Stock options granted under the Directors' Plan are intended not
to qualify as "incentive stock options" as defined by Section 422 under the
Internal Revenue Code of 1986, as amended (the "Code"). See "Certain Federal
Income Tax Information" for a discussion of the tax treatment of nonstatutory
stock options.
PURPOSE
The Directors' Plan was adopted to provide a means by which individuals who
serve as members of the Company's Board of Directors, and who are not
otherwise employed by the Company, could be given an opportunity to purchase
stock in the Company and to provide incentives for such persons to exert
maximum efforts for the success of the Company. The Company's four non-
employee directors are eligible to participate in the Directors' Plan.
ADMINISTRATION
The Directors' Plan is administered by the Board of Directors of the
Company. The Board has the power to construe and interpret the Directors' Plan
and is authorized to delegate administration of the Directors' Plan to a
committee composed of not fewer than two members of the Board (the
"Committee"). As used herein with respect to the Directors' Plan, the "Board"
refers to the Committee as well as to the Board of Directors itself.
ELIGIBILITY
Only non-employee directors of the Company are eligible to receive options
under the Directors' Plan.
STOCK SUBJECT TO THE DIRECTORS' PLAN
If options granted under the Directors' Plan expire or otherwise terminate
without being exercised, the Common Stock not purchased pursuant to such
options becomes available again for issuance under the Directors' Plan.
TERM OF OPTIONS
The following is a description of the terms of options under the Directors'
Plan. Each option granted under the Directors' Plan is non-discretionary and
must be made in accordance with the terms described below.
Options Grants. The Directors' Plan, as amended to date by the Board of
Directors, provides for the automatic, non-discretionary grant of options to
purchase 6,000 shares of the Company's Common Stock, on the anniversary of
each non-employee director's initial grant, to each non-employee director in
service as of such date. In addition, each new member of the Company's Board
will be granted options to purchase 14,000 shares of the Company's Common
Stock as of the date of his or her initial election to the Board.
Exercise Price; Payment. The exercise price of all options under the
Directors' Plan may not be less than 100% of the fair market value of the
Common Stock subject to the option on the date the option is granted. The
exercise price of options granted under the Directors' Plan must be paid
either (a) in cash at the time the option is exercised or (b) by delivery of
other Common Stock of the Company.
Option Exercise. Options granted under the Directors' Plan upon initial
election as a director become exercisable ("vest") in four equal annual
installments commencing on the date one year after the date of the option
grant. Shares issued upon the exercise of options are conditioned upon
satisfactory arrangements made by each non-employee director with the Company
to insure that the amount, if any, of federal or other withholding tax
required to be withheld pursuant to such option exercise is made available to
the Company for timely payment of such tax.
12
<PAGE>
Term, Transferability. The maximum term of options under the Directors' Plan
is ten years. An option may not be transferred by the optionee, except by will
or by the laws of descent and distribution. During the lifetime of an
optionee, an option may be exercised only by the optionee or his or her
guardian or legal representative.
ADJUSTMENT PROVISIONS
If there is any change in the stock subject to the Directors' Plan or
subject to any option granted under the Directors' Plan (through merger,
consolidation, reorganization, stock dividend, dividend in property other than
cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or otherwise), the Directors' Plan and
options outstanding thereunder will be adjusted appropriately as to the class
and the maximum number of shares subject to such plan, the maximum number of
shares and price per share of stock subject to such outstanding options.
EFFECT OF CERTAIN CORPORATE EVENTS
The Directors' Plan provides that, in the event of a specified type of
merger, dissolution, liquidation or other corporate reorganization, the time
during which such options may be exercised will be accelerated and the options
terminated if not exercised prior to such time. The acceleration of an option
in the event of an acquisition or similar corporate event may be viewed as an
antitakeover provisions, which may have the effect of discouraging a proposal
to acquire or otherwise obtain control of the Company.
DURATION, AMENDMENT AND TERMINATION
The Board may suspend or terminate the Directors' Plan without stockholder
approval or ratification at any time or from time to time. Unless sooner
terminated, the Directors' Plan will terminate in June, 2003.
The Board also may amend the Directors' Plan at any time or from time to
time. However, no amendment will be effective unless approved by the
shareholders of the Company within twelve months of its adoption by the Board
if the amendment would require shareholder approval in order for the
Directors' Plan to comply with Rule 16b-3 or satisfy the requirements of
Section 422 of the Code or any Nasdaq National Market requirement. Subject to
the foregoing, the Board may amend the 1993 Plan in any respect the Board
deems necessary or advisable to provide optionees with the maximum benefits
available under the Code or to bring the 1993 Plan or any option granted
thereafter into compliance with the Code.
CERTAIN FEDERAL INCOME TAX INFORMATION
Stock options granted under the Directors' Plan are subject to federal
income tax treatment pursuant to rules governing options that are not
incentive stock options.
Options granted under the Directors' Plan are nonstatutory stock options.
There are no tax consequences to the optionee or the Company by reason of the
grant of a nonstatutory stock option. Upon exercise of a nonstatutory stock
option, the optionee normally will recognize taxable ordinary income equal to
the excess of the stock's fair market value on the date of exercise over the
option exercise price. Because the optionee is a director of the Company,
under existing laws, the date of taxation (and the date of measurement of
taxable ordinary income) may in some instances be deferred unless the optionee
files an election under Section 83(b) of the Code. The filing of Section 83(b)
election with respect to the exercise of an option may affect the time of
taxation and the amount of income recognized at each such time. Upon
disposition of the stock, the optionee will recognize a capital gain or loss
equal to the difference between the selling price and the sum of the amount
paid for such stock plus any amount recognized as ordinary income upon
exercise of such option. Such gain or loss will be long or short-term
depending on whether the stock was held for more than one (1) year.
13
<PAGE>
NEW PLAN BENEFITS
The following table presents certain information with respect to options
granted under the Directors' Plan that are subject to the approval of the
amendment of the Directors' Plan by the shareholders to the individuals and
groups indicated. Only non-employee directors are eligible to be granted
options under the Directors' Plan.
<TABLE>
<CAPTION>
1993 NON-EMPLOYEE
DIRECTORS' STOCK OPTION
PLAN
-------------------------
EXERCISE NUMBER OF SHARES
PRICE SUBJECT TO
NAME AND POSITION ($/SH.) OPTIONS GRANTED
----------------- -------- ----------------
<S> <C> <C>
Stanley Grubel..................................... $9.25 14,000
Director
Ashok K. Sinha..................................... 9.25 14,000
Director
Tsuyoshi Kawanishi................................. 9.25 10,000
Director
Walter W. Wilson................................... 9.25 6,000
Director 9.125 4,000
------ ------
All non-employee directors as a Group.............. $9.24 48,000
</TABLE>
14
<PAGE>
PROPOSAL 4
RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Arthur Andersen LLP as the Company's
independent auditors for the fiscal year ending March 31, 1998 and has further
directed that management submit the selection of independent auditors for
ratification by the shareholders at the Annual Meeting. Arthur Andersen LLP
has audited the Company's financial statements since its inception in 1984.
Representatives of Arthur Andersen LLP are expected to be present at the
Annual Meeting, will have an opportunity to make a statement if they so desire
and will be available to respond to appropriate questions.
Shareholder ratification of the selection of Arthur Andersen LLP as the
Company's independent auditors is not required by the Company's Bylaws or
otherwise. However, the Board is submitting the selection of Arthur Andersen
LLP to the shareholders for ratification as a matter of good corporate
practice. If the shareholders fail to ratify the selection, the Audit
Committee and the Board will reconsider whether or not to retain that firm.
Even if the selection is ratified, the Audit Committee and the Board in their
discretion may direct the appointment of different independent auditors at any
time during the year if they determine that such a change would be in the best
interests of the Company and its shareholders.
The affirmative vote of the holders of a majority of the shares present in
person or represented by proxy and voting at the Annual Meeting will be
required to ratify the selection of Arthur Andersen LLP.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 4.
15
<PAGE>
ADDITIONAL INFORMATION
The current directors and executive officers of the Company, and their ages
as of June 30, 1997, are as follows:
MANAGEMENT
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<C> <C> <S>
Mihir Parikh 50 Chairman of the Board and Chief Executive
Officer
Terry L. Moshier 48 President and Chief Operating Officer
Anthony C. Bonora 54 Senior Vice President, Research and
Development and Chief Technical Officer
Douglas J. McCutcheon 48 Senior Vice President, Chief Financial Officer
William R. Leckonby 57 President and Chief Operating Officer, Asyst
Software, Inc.
Stanley Grubel 55 Director
Tsuyoshi Kawanishi 68 Director
Ashok K. Sinha(2) 53 Director
James E. Springgate(1)(2) 70 Director
Walter W. Wilson(1) 53 Director
</TABLE>
- --------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
Mr. Moshier has served as President and Chief Operating Officer of the
Company since May 1997. From July 1996 to May 1997, Mr. Moshier served as
Executive Vice President and Chief Operating Officer of the Company. From June
1995 to June 1996, Mr. Moshier was on the Advisory Board of the Arizona
Technology Incubator Fund, a non-profit organization assisting start-up
technology companies. Prior to such time, Mr. Moshier was Senior Vice
President of Technology and Operations for Telxon Corporation, a designer and
manufacturer of hand-held wireless computers, from November 1993 to June 1995.
From June 1990 to October 1993, Mr. Moshier was Director of Operations of the
Motorola Computer Group, a wholly-owned subsidiary of Motorola.
Mr. Bonora joined Asyst in 1984 and has been Senior Vice President, Research
and Development of the Company since 1986 and Chief Technical Officer since
January 1996.
Mr. McCutcheon joined the Company in January 1996 as Senior Vice President,
Chief Financial Officer. From January 1991 to November 1995, Mr. McCutcheon
was Vice President, Corporate Finance at Cadence Design Systems, Inc., a
design automation software company. Prior to 1991, Mr. McCutcheon was
President of Toshiba America Medical Credit, a captive financing subsidiary of
Toshiba America.
Mr. Leckonby has served as President and Chief Operating Officer of Asyst
Software, Inc. since June 1996. From October 1993 to June 1996, Mr. Leckonby
was President and Chief Executive Officer of Integral Systems, Inc. an
enterprise application software and services company. From 1986 to September
1993, Mr. Leckonby was President and Chief Operating Officer of Tesseract
Corporation, an enterprise application software and services company.
16
<PAGE>
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the ownership
of the Company's Common Stock as of June 30, 1997 by: (i) each nominee for
director; (ii) each of the executive officers named in the Summary
Compensation Table employed by the Company; (iii) all executive officers and
directors of the Company as a group; and (iv) all those known by the Company
to be beneficial owners of more than five percent (5%) of its Common Stock.
<TABLE>
<CAPTION>
BENEFICIALLY
OWNERSHIP(1)
-----------------
5% SHAREHOLDERS, DIRECTORS AND OFFICERS NUMBER PERCENT
- --------------------------------------- --------- -------
<S> <C> <C>
J.&W. Seligman & Co., Incorporated............................ 1,861,000 17.4%
100 Park Avenue
New York, NY 10017
Mihir Parikh(2)............................................... 520,058 4.8%
Anthony C. Bonora(3).......................................... 45,630 *
Douglas J. McCutcheon(4)...................................... 20,464 *
Terry L. Moshier(5)........................................... 14,280 *
William R. Leckonby(6)........................................ 3,332 *
James E. Springgate(7)........................................ 21,374 *
Walter W. Wilson(8)........................................... 6,500 *
Stanley Grubel................................................ 0 *
Ashok K. Sinha................................................ 0 *
Tsuyoshi Kawanishi(9)......................................... 2,500 *
All directors and officers as a group (10 persons)(10)........ 634,138 5.8%
</TABLE>
- --------
* Less than one percent.
(1) This table is based upon information supplied by officers, directors and
principal shareholders and Schedules 13D and 13G, if any, filed with the
Securities and Exchange Commission (the "Commission"). Unless otherwise
indicated in the footnotes to this table and subject to community
property laws where applicable, each of the shareholders named in this
table has sole voting and investment power with respect to the shares
indicated as beneficially owned. Applicable percentages are based on
10,710,572 shares outstanding on June 30, 1997, adjusted as required by
rules promulgated by the Commission.
(2) Includes 355,500 shares held of record by Mihir & Nancy Parikh Living
Trust, dated April 3, 1986, of which Mr. Parikh is a trustee. Also
includes 49,600 shares held by a custodian for the benefit of Dr.
Parikh's minor children, of which Dr. Parikh disclaims beneficial
ownership. Includes 114,958 shares subject to stock options exercisable
within 60 days of June 30, 1997.
(3) Includes 21,740 shares subject to stock options exercisable within 60
days of June 30, 1997.
(4) Includes 20,464 shares subject to stock options exercisable within 60
days of June 30, 1997.
(5) Includes 14,280 shares subject to stock options exercisable within 60
days of June 30, 1997.
(6) Includes 3,332 shares subject to stock options exercisable within 60 days
of June 30, 1997.
(7) Includes 21,374 shares subject to stock options exercisable within 60
days of June 30, 1997.
(8) Includes 6,500 shares subject to stock options exercisable within 60 days
of June 30, 1997.
(9) Includes 2,500 shares subject to stock options exercisable within 60 days
of June 30, 1997.
(10) Includes an aggregate of 193,150 shares held by all directors and
executive officers that are subject to options exercisable within 60 days
of June 30, 1997. See Notes (2) through (9), above.
17
<PAGE>
COMPLIANCE WITH THE REPORTING REQUIREMENTS OF SECTION 16(A)
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
a registered class of the Company's equity securities, to file with the SEC
initial reports of ownership and reports of changes in ownership of Common
Stock and other equity securities of the Company. Offices, directors and
greater than ten percent shareholders are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended March 31, 1997, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten percent beneficial owners were complied with.
EXECUTIVE COMPENSATION
COMPENSATION OF DIRECTORS
Walter W. Wilson, James Springgate and Stanley Grubel each received $3,500
and Ashok K. Sinha received $2,500 for service on the Board of Directors or
any committee thereof, and directors may be reimbursed for certain expenses in
connection with attendance at Board and committee meetings.
In June 1993, the Company adopted the Directors' Plan to provide for the
automatic grant of options to purchase shares of Common Stock to non-employee
directors of the Company. See Proposal 3--"Approval of the 1993 Non-Employee
Directors' Stock Option Plan, as Amended" for a description of the Directors'
Plan.
During fiscal 1997, the following directors received options under the
Directors' Plan: Mr. Grubel and Mr. Sinha were each granted an option to
purchase 14,000 shares of Common Stock at an exercise price of $9.25 per share
upon his initial election to the Board of Directors in January 1997 and, upon
their respective anniversaries of their initial grants, Mr. Springgate was
granted an additional option to purchase 6,000 shares of Common Stock at an
exercise price of $9.75 per share in September 1996, Mr. Kawanishi was granted
additional options to purchase 10,000 shares of Common Stock at an exercise
price of $9.25 per share in January 1997, and Mr. Wilson was granted an
additional option to purchase 6,000 shares of Common Stock at an exercise
price of $9.125 per share in February 1997 and an additional option to
purchase 4,000 shares of Common Stock at an exercise price of $9.25 per share
in January 1997.
18
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY OF COMPENSATION
The following table shows for the fiscal year ended March 31, 1997
compensation awarded or paid to, or earned by the Company's Chief Executive
Officer and the Company's next five most highly compensated executive officers
who earned over $100,000 during the fiscal year (the "Named Executive
Officers"), except as disclosed below, no compensation characterized as long-
term compensation, including restricted stock awards issued at a price below
fair market value or long-term incentive plan payouts, was paid by the Company
during the fiscal year ended March 31, 1997 to any of the Named Executive
Officers:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION
COMPENSATION AWARDS
----------------- ------------
FISCAL OPTIONS ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(1) (# SHARES) COMPENSATION
- --------------------------- ------ -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Mihir Parikh .............. 1997 $249,519 $145,000 100,000 $11,644(2)
Chairman of the Board and 1996 215,024 177,188 100,000 22,684(3)
Chief Executive Officer 1995 185,000 -- 70,000 15,764(4)
Terry L. Moshier........... 1997 141,539 90,000 150,000 --
President and 1996 -- -- -- --
Chief Operating Officer 1995 -- -- -- --
Douglas J. McCutcheon...... 1997 163,096 80,300 10,000 5,381(5)
Senior Vice President, 1996 30,462 -- 90,000 --
Chief Financial Officer 1995 -- -- -- --
Anthony C. Bonora.......... 1997 158,827 80,500 30,000 2,381(5)
Senior Vice President,
Research 1996 147,300 77,500 30,000 2,711(6)
and Development and Chief
Technical Officer 1995 136,000 -- 50,000 --
William R. Leckonby........ 1997 150,000 64,400 20,000 540(5)
President and Chief
Operating 1996 -- -- -- 4,500(6)
Officer of Asyst Software,
Inc. 1995 -- -- -- --
</TABLE>
- --------
(1) The Company's officers are eligible for annual cash bonuses under the
terms of the Company's Executive Bonus Plans, adopted each fiscal year.
Payments of bonuses are based upon achievement of specified financial
objectives determined by the Board of Directors at the beginning of each
fiscal year. Financial objectives are based, in part, on the Company's
operating budget and results of operations.
(2) Consists of the following payments made by the Company: (i) $6,000 car
allowance, (ii) $600 for premiums for term life and supplemental
disability insurance, (iii) $5,044 in matching contributions to the
Company's 401(k) plan and (iv) reimbursements for certain incidental
expenses.
(3) Consists of the following payments made by the Company: (i) $6,000 car
allowance, (ii) $8,032 for premiums for term life insurance and
supplemental disability insurance, (iii) $8,652 in matching contributions
to the Company's 401(k) plan and (iv) reimbursements for certain
incidental expenses.
(4) Consists of the following payments made by the Company: (i) $6,000 car
allowance, (ii) $9,674 for premiums for term life insurance and
supplemental disability life insurance and (iii) reimbursements for
certain incidental expenses.
(5) Consists of matching contributions to the Company's 401(k) plan.
(6) Consists of a car allowance paid by the Company.
19
<PAGE>
STOCK OPTION GRANTS AND EXERCISES
The following tables show for the fiscal year ended March 31, 1997 certain
information regarding options granted to, exercised by, and held at year end
by the Named Executive Officers:
OPTION GRANTS IN LAST FISCAL YEAR 1996
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
RATES OF STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM(3)
------------------------ -----------------------
PERCENT OF TOTAL
OPTIONS OPTIONS GRANTED EXERCISE
GRANTED TO EMPLOYEES IN PRICE EXPIRATION
NAME (#)(1) FISCAL YEAR(2) ($/SH) DATE 5% 10%
---- ------- ---------------- --------- ---------- -----------------------
<S> <C> <C> <C> <C> <C> <C>
Mihir Parikh............ 100,000 12.6% $10.84375 06/13/06 $ 681,958 $ 1,728,214
Terry L. Moshier........ 150,000 18.9 10.125 08/08/06 955,134 2,420,496
Douglas J. McCutcheon... 10,000 1.3 10.84375 06/13/06 68,196 172,821
Anthony C. Bonora....... 30,000 3.8 10.84375 06/13/06 204,587 518,464
William R. Leckonby..... 20,000 2.5 10.125 07/10/06 127,351 322,732
</TABLE>
- --------
(1) Unless otherwise noted, options granted are subject to standard vesting
and become exercisable at a rate of 2.38% of the shares subject to the
option at the end of each month for 42 months following a six month
waiting period with no vesting. The term of the options is 10 years.
(2) Based on an aggregate of 793,044 options granted to directors and
employees of the Company in fiscal 1996 including the Named Executive
Officers.
(3) The potential realizable value is calculated based on the term of the
option at its time of grant (10 years). It is calculated by assuming that
the stock price on the date of grant appreciates at the indicated annual
rate compounded annually for the entire term of the option and that the
option is exercised and sold on the last day of its term for the
appreciated stock price. No gain to the optionee is possible unless the
stock price increases over the option term, which will benefit all
shareholders.
20
<PAGE>
The following table shows the number and value of the unexercised options
held by each of the Named Executive Officers at March 31, 1997:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR,
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS AT
AT FY-END(#) FY-END
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE(#) REALIZED(1) UNEXERCISABLE UNEXERCISABLE(2)
- ---- --------------- ----------- -------------- ----------------
<S> <C> <C> <C> <C>
Mihir Parikh............ 0 0 76,636/193,364 $174,930/70,070
Terry L. Moshier........ 0 0 3,808/146,192 0/0
Douglas J. McCutcheon... 0 0 12,138/87,862 0/0
Anthony C. Bonora....... 8,600 $86,453 34,222/69,778 87,290/66,710
William R. Leckonby..... 0 0 952/19,048 0/0
</TABLE>
- --------
(1) Based on the fair market value of the Company's Common Stock on the date
of exercise minus the exercise price of the options.
(2) Based on the fair market value of the Company's Common Stock as of March
31, 1997 minus the exercise price of the options.
21
<PAGE>
REPORT OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
REPORT OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION/1/
The Board of Directors is responsible for establishing the Company's
compensation programs including salaries, bonuses (if any) and stock ownership
programs for all employees, including the Chief Executive Officer and the
other executive officers. The Board evaluates performance and determines
compensation policies and levels.
COMPENSATION PHILOSOPHY
The goals of the compensation program are to align compensation with
business objectives and performance and to enable the Company to attract,
retain and reward executive officers and other key employees who contribute to
the long-term success of the Company and to motivate them to enhance long-term
shareholder value. Key elements of this philosophy are:
. The Company pays competitively with leading companies with which it
competes for talent. The Company regularly compares its pay practices
with high-growth Silicon Valley companies in the semiconductor capital
equipment industry and selected companies appearing in compensation
surveys published by the American Electronics Association, and sets it
pay parameters based on this review. When using comparative data, the
Company attempts to set its compensation levels in the mid-range of
management compensation at the companies examined.
. The Company maintains annual incentive opportunities sufficient to
provide motivation to achieve specific operating goals and to generate
rewards that bring total compensation to competitive levels.
. The Company provides equity-based incentives for executives and other key
employees to ensure that they are motivated over the long-term to respond
to the Company's business challenges and opportunities as owners and not
just as employees.
Base Salary. The Board annually reviews each executive officer's base
salary. When reviewing base salaries, the Compensation Committee makes a
subjective assessment of, in order of importance, individual and corporate
performance, levels of responsibility, prior experience, breadth of knowledge
and competitive pay practices. The weight of these factors in the case of a
particular individual's compensation may vary.
Annual Incentive. The Company's Executive Bonus Plan (the "Bonus Plan")
adopted each year, is a variable pay program pursuant to which officers and
other senior managers of the Company may earn additional annual compensation.
The actual incentive award earned depends on the extent to which the Company's
articulated objectives are achieved. At the start of each year, the Board
reviews and approves the annual performance objectives for the Company and
establishes an individual bonus pool for each executive officer. For fiscal
1997, the goal was based on a targeted level of operating earnings per share
and individual performance objectives. The total bonus pool for all the
executive officers was $575,000 for fiscal 1997.
Individual awards are determined by evaluating the Company's performance
against the goal and allocating a pro rata portion of the individual award
pool based on the Company's performance against objectives during the year.
- --------
/1The/material in this report is not soliciting material, is not deemed filed
with the SEC, and is not incorporated by reference in any filing of the
Company under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, whether made before or after the date of
this proxy statement and irrespective of any general incorporation language
in such filing.
22
<PAGE>
Long-Term Incentives. The Company's long-term incentive program currently
consists of the 1993 Stock Option Plan. The option program utilizes vesting
periods (generally four years) to encourage key employees to continue in the
employ of the Company and provide equity incentives to build long-term
shareholder value. The size of option grants is determined based on competitive
practices at leading companies in the industry and the Company's philosophy of
significantly linking executive compensation with shareholder interests. The
Board attempts to set equity compensation levels in the mid-range of comparable
companies. In making awards, the Board considers the number, value and vesting
of an officer's outstanding options.
CORPORATE PERFORMANCE AND CHIEF EXECUTIVE OFFICER COMPENSATION
The Board set Dr. Parikh's base annual salary for fiscal year 1997 at
approximately $249,500. This amount was intended to provide an annual cash
compensation level in the mid-range of salaries of comparable companies. In
setting this amount, the Board took into account (i) the scope of Dr. Parikh's
responsibility, and (ii) the Board's confidence in Dr. Parikh to lead the
Company's continued development.
Based on the Company's growth in revenue and profitability and other non-
financial objectives, the Board awarded Dr. Parikh a bonus of $145,000 for
fiscal 1997. Dr. Parikh was also awarded stock options covering 100,000 shares
in fiscal year 1997 to maintain his equity incentive position consistent with
the objectives set forth above.
SECTION 162(M) OF THE INTERNAL REVENUE CODE.
Section 162(m) of the Internal Revenue Code (the "Code") limits the Company
to a deduction for federal income tax purposes of no more than $1 million of
compensation paid to certain Named Executive Officers in a taxable year.
Compensation above $1 million may be deducted if it is "performance-based
compensation" within the meaning of the Code.
The Board believes that at the present time it is quite unlikely that the
compensation paid to any Named Executive Officer in a taxable year which is
subject to the deduction limit will exceed $1 million. Nevertheless, the Board
has determined that options granted under the Plan with an exercise price at
least equal to the fair market value of the Company's common stock on the date
of grant shall be treated as "performance based compensation." The Board
intends to continue to evaluate the effects of the statute and to comply with
Code Section 162(m) in the future to the extent consistent with the best
interests of the Company.
CONCLUSION
Through the programs described above, a significant portion of the Company's
compensation program and Dr. Parikh's compensation are contingent on Company
performance, and realization of benefits is closely linked to increases in
long-term shareholder value. The Company remains committed to this philosophy
of pay for performance, recognizing that the competitive market for talented
executives and the volatility of the Company's business may result in highly
variable compensation for a particular time period.
Mihir Parikh
Walter W. Wilson
Ashok K. Sinha
James E. Springgate
Tsuyoshi Kawanishi
Stanley Grubel
23
<PAGE>
PERFORMANCE MEASUREMENT COMPARISON(1)
The following graph shows the total shareholder return of an investment of
$100 in cash on September 22, 1994, the date of commencement of trading of the
Company's Common Stock, for (i) the Company's Common Stock, (ii) the Nasdaq
Market Index, as calculated by Media General ("Nasdaq"), and (iii) the Media
General Industry Group 355 Index--Special Industry Machinery, except
Metalworks, a published index ("Media General"). All values assume
reinvestment of the full amount of all dividends and are calculated as of
December 31 of each year:
COMPARISON OF CUMULATIVE TOTAL RETURN
OF COMPANY, INDUSTRY INDEX AND BROAD MARKET
PERFORMANCE GRAPH APPEARS HERE
<TABLE>
<CAPTION>
ASYST
Measurement Period TECHNOLOGIES INDUSTRY
(Fiscal Year Covered) INC INDEX NASDAQ
- ------------------- ---------- --------- ----------
<S> <C> <C> <C>
Measurement Pt-1993 $100.00 $100.00 $100.00
FYE 1994 $109.09 $108.03 $101.85
FYE 1995 $334.09 $145.23 $108.05
FYE 1996 $206.82 $152.43 $145.33
FYE 1997 $177.27 $183.15 $162.59
</TABLE>
- --------
/1/The material in this performance graph is not soliciting material, is not
deemed filed with the SEC, and is not incorporated by reference in any
filing of the Company under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, whether made before or after
the date of this proxy statement and irrespective of any general
incorporation language in such filing.
24
<PAGE>
CERTAIN TRANSACTIONS
In August 1997, the Company loaned $200,000 (the "Loan") to Terry Moshier,
President and Chief Operating Officer of the Company, in order to assist Mr.
Moshier with the purchase of a new residence as part of his relocation to
California. The Loan has an interest rate of 4% per annum while Mr. Moshier is
an employee of the Company and 6.39% per annum if Mr. Moshier's employment
with the Company terminates for any reason. The Loan is secured by a second
deed of trust on Mr. Moshier's California residence. The Loan terminates and
shall be immediately due and payable upon the earlier of: (i) September 1,
2002, (ii) 90 days after the termination of Mr. Moshier's employment for any
reason, (iii) a default on the repayment of any principal or interest on the
Loan, (iv) a default on the first mortgage on the property, (v) the sale or
transfer of the property or (vi) the insolvency of Mr. Moshier.
In addition, in August 1997 the Company loaned Mr. Moshier $180,000 (the
"Second Loan") in order to facilitate his relocation to California. The Second
Loan has an interest rate of 6.39% and is secured by a pledge of all of the
shares of Company Common Stock that Mr. Moshier owns or that he may
subsequently acquire. The Second Loan shall be forgiven equally over a 48
month period; provided, however, that if Mr. Moshier's employment is
terminated without cause or by his death, the Second Loan shall be forgiven in
full. The Second Loan shall terminate and be immediately due and payable upon
the earlier of: (i) 90 days after Mr. Moshier's voluntary termination, (ii)
Mr. Moshier's insolvency or (iii) Mr. Moshier's termination for cause.
OTHER MATTERS
The Board of Directors knows of no other matters that will be presented for
consideration at the Annual Meeting. If any other matters are properly brought
before the meeting, it is the intention of the persons named in the
accompanying proxy to vote on such matters in accordance with their best
judgment.
By Order of the Board of Directors
/s/ JAMES C. KITCH
James C. Kitch
Secretary
August 25, 1997
A COPY OF THE COMPANY'S ANNUAL REPORT TO THE SECURITIES AND EXCHANGE
COMMISSION ON FORM 10-K FOR THE FISCAL YEAR ENDED MARCH 31, 1997 IS AVAILABLE
WITHOUT CHARGE UPON WRITTEN REQUEST TO: DOUGLAS J. MCCUTCHEON, ASYST
TECHNOLOGIES, INC, 48761 KATO ROAD, FREMONT, CA 94538.
25
<PAGE>
ASYST TECHNOLOGIES, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 29, 1997
The undersigned hereby appoints Mihir Parikh and Douglas McCutcheon,
and each of them, as attorneys and proxies of the undersigned, with full power
of substitution, to vote all of the shares of stock of Asyst Technologies, Inc.
which the undersigned may be entitled to vote at the Annual Meeting of
Shareholders of Asyst Technologies, Inc. to be held at the Beverly Heritage
Hotel, 1820 Barber Lane, Milpitas, California on Monday, September 29, 1997, at
3:00 p.m., local time, and at any and all postponements, continuations and
adjournments thereof, with all powers that the undersigned would possess if
personally present, upon and in respect of the following matters and in
accordance with the following instructions, with discretionary authority as to
any and all other matters that may properly come before the meeting.
UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR
ALL NOMINEES LISTED IN PROPOSAL 1 AND FOR PROPOSALS 2, 3 AND 4, AS MORE
SPECIFICALLY DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC INSTRUCTIONS ARE
INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.
MANAGEMENT RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR LISTED BELOW.
PROPOSAL 1: To elect directors to hold office until the next Annual Meeting
of Shareholders and until their successors are elected.
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to
(except as marked to the contrary vote for all nominees
below). listed below.
NOMINEES: Mihir Parikh, Stanley Grubel, Tsuyoshi Kawanishi, Ashok K. Sinha,
James E. Springgate and Walter W. Wilson
TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE(S), WRITE SUCH NOMINEE(S)' NAME(S)
BELOW:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Continued on other side)
1
<PAGE>
(Continued from other side)
MANAGEMENT RECOMMENDS A VOTE FOR PROPOSALS 2, 3, 4 AND 5.
PROPOSAL 2: To approve the Company's 1993 Stock Option Plan, as amended, to
increase the aggregate number of shares of Common Stock
authorized for issuance under such plan by 500,000 shares and to
add provisions with respect to Section 162(m) of the Internal
Revenue Code of 1986, as amended.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PROPOSAL 3: To approve the Company's 1993 Non-Employee irectors' Stock Option
Plan, as amended, to increase the aggregate number of shares of
Common Stock authorized for issuance under such plan by 150,000
shares and to increase the size of the initial options to
purchase Common Stock granted thereunder to 14,000 shares.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PROPOSAL 4: To ratify selection of Arthur Andersen LLP as independent
auditors of the Company for its fiscal year ending March 31,
1998.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
DATED , 1997
----------- -------------------------------------------------
-------------------------------------------------
SIGNATURE(S)
Please sign exactly as your name appears hereon.
If the stock is registered in the names of two or
more persons, each should sign. Executors,
administrators, trustees, guardians and attorneys-
in-fact should add their titles. If signer is a
corporation, please give full corporate name and
have a duly authorized officer sign, stating
title. If signer is a partnership, please sign in
partnership name by authorized person.
PLEASE VOTE, DATE AND PROMPTLY RETURN THIS PROXY IN THE ENCLOSED RETURN ENVELOPE
WHICH IS POSTAGE PREPAID IF MAILED IN THE UNITED STATES.
2
