SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
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 Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for Use of the Commission Only ( as permitted by Rule
14a-6(e)(2))
APPLIED SCIENCE AND TECHNOLOGY INC.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] $125 PER EXCHANGE ACT RULES 0-11(C)(1)(II), 14A-6(I)(1), OR 14A-6(I)(2) OR
ITEM 22(A)(2) OF SCHEDULE 14A.
[ ] $500 PER EACH PARTY 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 TRANSACTION:
___________________________________________________________________________
(5) TOTAL FEE PAID:
__$125_____________________________________________________________________
[ ] FEE PREVIOUSLY PAID 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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(4) DATE FILED:
___________________________________________________________________________
APPLIED SCIENCE AND TECHNOLOGY, INC.
35 CABOT ROAD
WOBURN, MASSACHUSETTS 01801
October 18, 1996
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
of APPLIED SCIENCE AND TECHNOLOGY, INC. (the "Corporation") to be held on
Thursday, November 21, 1996 at 10:30 a.m. at the offices of the Corporation, 35
Cabot Road, Woburn, Massachusetts 01801.
At the Annual Meeting, you will be asked (i) to elect three (3) members
of the Board of Directors of the Corporation; and (ii) to ratify and approve the
selection of the Corporation's independent auditors. Details of the matters to
be considered at the Annual Meeting are contained in the Proxy Statement, which
we urge you to review carefully.
Whether or not you plan to attend the Annual Meeting, please complete,
date, sign and return your Proxy promptly in the enclosed envelope, which
requires no postage if mailed in the United States. If you attend the Annual
Meeting, you may vote in person if you wish, even if you have previously
returned your Proxy.
On behalf of the Board of Directors, I would like to express our
appreciation for your continued interest in the affairs of the Corporation.
Sincerely,
Richard S. Post, Ph.D.
President
APPLIED SCIENCE AND TECHNOLOGY, INC.
35 CABOT ROAD
WOBURN, MASSACHUSETTS 01801
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
APPLIED SCIENCE AND TECHNOLOGY, INC. (the "Corporation"), a Delaware
corporation, will be held on Thursday, November 21, 1996 at 10:30 a.m. at the
Corporation's offices located at 35 Cabot Road, Woburn, Massachusetts 01801, for
the following purposes:
1. To elect three (3) members of the Board of Directors;
2. To ratify and approve the selection of KPMG Peat Marwick LLP as
independent auditors for the Corporation for the fiscal year ending
June 28, 1997; and
3. To consider and act upon any matters incidental to the foregoing and
any other matters that may properly come before the meeting or any
adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on October 1,
1996, as the record date for the determination of stockholders entitled to
notice of and vote at the Annual Meeting and any adjournment or adjournments
thereof.
By Order of the
Board of Directors
John M. Tarrh
Secretary
Woburn, Massachusetts
October 18, 1996
IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND IN PERSON, WE URGE YOU TO SIGN, DATE, AND
RETURN THE ENCLOSED PROXY AT YOUR EARLIEST CONVENIENCE. THIS WILL ENSURE THE
PRESENCE OF A QUORUM AT THE MEETING. PROMPTLY SIGNING, DATING, AND RETURNING
THE PROXY WILL SAVE THE CORPORATION THE EXPENSES AND EXTRA WORK OF ADDITIONAL
SOLICITATION. AN ADDRESSED ENVELOPE FOR WHICH NO POSTAGE IS REQUIRED IF
MAILED IN THE UNITED STATES IS ENCLOSED FOR THAT PURPOSE. SENDING IN YOUR
PROXY WILL NOT PREVENT YOU FROM VOTING YOUR STOCK AT THE MEETING IF YOU
DESIRE TO DO SO, AS YOUR PROXY IS REVOCABLE AT YOUR OPTION.
APPLIED SCIENCE AND TECHNOLOGY, INC.
35 CABOT ROAD
WOBURN, MASSACHUSETTS 01801
---------------
PROXY STATEMENT
---------------
OCTOBER 18, 1996
The enclosed proxy is solicited by the Board of Directors of APPLIED
SCIENCE AND TECHNOLOGY, INC. (the "Corporation") for use at the Annual Meeting
of Stockholders (the "Annual Meeting") to be held on Thursday, November 21,
1996, at 10:30 a.m. at the offices of the Corporation, 35 Cabot Road, Woburn,
Massachusetts 01801, and at any adjournment or adjournments thereof.
Stockholders of record at the close of business on October 1, 1996,
will be entitled to vote at the Annual Meeting or any adjournment thereof. On
that date, 4,448,475 shares of the Corporation's common stock, $.01 par value
per share (the "Common Stock"), were issued and outstanding. Each share of
Common Stock entitles the holder to one vote with respect to all matters
submitted to stockholders at the Annual Meeting. The Corporation has no other
voting securities.
The presence of the holders of a majority of the issued and outstanding
shares of Common Stock entitled to vote at the Annual Meeting, either in person
or represented by a properly executed proxy, is necessary to constitute a quorum
for the transaction of business at the Annual Meeting.
The election of directors will be determined by a plurality vote. The
other proposal to be voted upon by the stockholders of the Corporation requires
the vote of a majority of shares of Common Stock present at the Annual Meeting
for passage. Abstentions and broker non-votes (the latter of which result when a
broker holding shares for a beneficial holder in "street name" has not received
timely voting instructions on certain matters from such beneficial holder and
the broker does not have discretionary voting power on such matters) are counted
for purposes of determining the presence or absence of a quorum at the Annual
Meeting. Abstentions are counted in tabulations of the votes cast on proposals
presented to stockholders, whereas broker non-votes are not counted for purposes
of determining whether a proposal has been approved.
THE DIRECTORS, NOMINATED DIRECTORS AND OFFICERS OF THE CORPORATION AS A
GROUP OWN OR MAY BE DEEMED TO CONTROL 1,106,190 SHARES OF COMMON STOCK,
CONSTITUTING APPROXIMATELY 24.8% OF THE OUTSTANDING SHARES OF COMMON STOCK OF
THE CORPORATION. EACH OF THE DIRECTORS, NOMINATED DIRECTORS AND OFFICERS HAS
INDICATED HIS INTENT TO VOTE ALL SHARES OF COMMON STOCK OWNED OR CONTROLLED BY
HIM IN FAVOR OF EACH ITEM SET FORTH HEREIN.
2
Execution of a proxy will not in any way affect a stockholder's right
to attend the Annual Meeting and vote in person. The proxy may be revoked at any
time before it is exercised by written notice to the Secretary prior to the
Annual Meeting, or by giving to the Secretary a duly executed proxy bearing a
later date than the proxy being revoked at any time before such proxy is voted,
or by appearing at the Annual Meeting and voting in person. The shares
represented by all properly executed proxies received in time for the Annual
Meeting will be voted as specified therein. In the absence of other instructions
set forth on a proxy, shares will be voted in favor of the election as directors
of those persons named in this Proxy Statement and in favor of all other items
set forth herein.
The Board of Directors knows of no other matter to be presented at the
Annual Meeting. If any other matter should be presented at the Annual Meeting
upon which a vote may be taken, such shares represented by all proxies received
by the Board of Directors will be voted with respect thereto in accordance with
the judgment of the persons named as attorneys in the proxies. The Board of
Directors knows of no matter to be acted upon at the Annual Meeting that would
give rise to appraisal rights for dissenting stockholders.
An annual report on Form 10-K, containing the Corporation's audited
financial statements for its fiscal years ended June 29, 1996 ("Fiscal Year
1996"), July 1, 1995 ("Fiscal Year 1995") and July 2, 1994 ("Fiscal Year 1994")
is being mailed together with this Proxy Statement to all stockholders entitled
to vote. This Proxy Statement and the accompanying proxy were first mailed to
stockholders on or about October 18, 1996.
PROPOSAL NO. 1
--------------
ELECTION OF DIRECTORS
The bylaws of the Corporation provide for a Board of Directors which is
divided into three classes. Directors constituting approximately one-third of
the Board of Directors are elected each year for a period of three years at the
Corporation's Annual Meeting of Stockholders and serve until their successors
are duly elected by the stockholders of the Corporation. The members of Class
III, Dr. Smith and Messrs. de Beaumont and Bertucci, are currently proposed for
reelection to the Board of Directors. The terms of the members of Class I, Dr.
Post and Mr. Anderson, expire in 1997, and the terms of the members of Class II,
Messrs. Tarrh and Kahl, expire in 1998. Messrs. Kahl and Anderson were elected
as directors by the Board of Directors effective October 1, 1995. Vacancies and
newly created directorships resulting from any increase in the number of
authorized directors may be filled by a majority vote of the directors then
remaining in office. Officers are elected by and serve at the discretion of the
Board of Directors.
3
Shares represented by all proxies received by the Board of Directors
and not so marked as to withhold authority to vote for an individual director,
or for all directors, will be voted (unless one or more nominees are unable or
unwilling to serve) for the election of the nominees named below. The Board of
Directors expects that each of the nominees will be available for election, but
if any of them is not a candidate at the time the election occurs, it is
intended that such proxy will be voted for the election of another nominee to be
designated by the Board of Directors to fill any such vacancy.
The following table sets forth the year each director was elected a
director and the age, positions and offices presently held by each director with
the Corporation:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
CLASS TO YEAR
WHICH FIRST
DIRECTOR BECAME A
NAME AGE BELONGS DIRECTOR POSITION
Richard S. Post, Ph.D........ 53 I 1987 Chief Executive Officer,
President and Chairman of
the Board of Directors
John M. Tarrh ............... 49 II 1987 Senior Vice President,
Finance, Secretary, Treasurer
and Director
Donald K. Smith, Ph.D........ 44 III 1987 Senior Vice President,
Advanced Technology, and
Director
Robert R. Anderson........... 59 I 1995 Director
Michel de Beaumont........... 54 III 1993 Director
John R. Bertucci............. 55 III 1994 Director
Hans-Jochen Kahl............. 56 II 1995 Director
</TABLE>
Mr. Jordan L. Golding has served as an advisor to the Board of
Directors since 1989.
The Board of Directors has appointed an Executive Committee presently
comprised of Drs. Post and Smith and Mr. Tarrh. The Executive Committee is
authorized to take any action that the Board of Directors is authorized to act
upon with the exception of the issuance of stock, the sale of all or
substantially all of the Corporation's assets, and any other significant
corporate transaction.
All of the directors of the Corporation who were directors during
Fiscal Year 1996 attended at least 75% of the meetings of the Board of Directors
and the committees on which they served during Fiscal Year 1996. The Board of
Directors met four (4) times formally, while the Executive Committee met
informally on a number of occasions during Fiscal Year 1996.
4
The Board of Directors also has appointed a Compensation Committee,
presently comprised of Mr. Kahl with Mr. Golding as an advisor, and an Audit
Committee comprised of Messrs. Bertucci and Anderson, with Mr. Golding as an
advisor. The Compensation Committee is responsible for negotiating and approving
compensation arrangements for officers, employees, consultants, and directors,
including the granting of options to purchase the Corporation's Common Stock
pursuant to any of the Corporation's stock option plans. The Audit Committee was
established for the purposes of (i) reviewing the Corporation's financial
results and recommending the selection of the Corporation's independent
auditors; (ii) reviewing the effectiveness of the Corporation's accounting
policies and practices, financial reporting and internal controls; and (iii)
reviewing the scope of independent audit coverages and fees, and any
transactions that may involve a potential conflict of interest and internal
control systems. In July 1995, the Board of Directors established a Stock Option
Committee to administer the Corporation's 1987 and 1993 Stock Option Plans.
Members of the Stock Option Committee are Messrs. de Beaumont and Bertucci, the
outside directors of the Corporation. The Compensation and Audit Committees met
three (3) and four (4) times, respectively, during Fiscal Year 1996.
None of the directors or executive officers of the Corporation are
related by blood, marriage, or adoption to any of the Corporation's directors or
executive officers. To date, no other committee of the Board of Directors except
as described above has been established.
BACKGROUND
The following is a brief summary of the background of each director of
the Corporation, as well as Mr. Golding, an advisor to the Board of Directors:
RICHARD S. POST, PH.D. has served as the Corporation's President, Chief
Executive Officer and Chairman of the Board since its inception in 1987. He has
also been President and Chairman of the Board of Directors of ASTeX/Gerling
Laboratories, Inc. ("AGL") since 1992. Prior to founding the Corporation, Dr.
Post served at the Massachusetts Institute of Technology ("MIT") from 1981 to
1987. At MIT, Dr. Post served as a Senior Research Scientist, in the position of
Head of the Mirror Confinement Division of the Plasma Fusion Center, where he
was responsible for project management, plasma physics and materials
interactions research. Dr. Post earned his Ph.D. in Plasma Physics from Columbia
University and his Bachelor of Science degree from the University of California
at Berkeley.
MR. JOHN M. TARRH has served as the Corporation's Senior Vice
President, Finance, and Secretary, and as a director since its inception in
1987. Mr. Tarrh became the Manager of the Mirror Confinement Division of MIT's
Plasma Fusion Center in 1986 where he was responsible for financial management,
project management and administration. Prior to joining the research staff of
MIT in 1978, he was the Executive Vice President - Operations of Magnetic
Engineering Associates, a privately held, high-technology company in Cambridge,
Massachusetts which was owned by Sala Magnetics. Mr. Tarrh presently serves as a
director for QC Optics, Inc., a privately
5
held designer of laser based defect detection systems. Mr. Tarrh received his
Master of Science degree in Electrical Engineering from MIT, and he earned his
Bachelor of Science degree in Electrical Engineering from Virginia Polytechnic
Institute and State University.
DONALD K. SMITH, PH.D. has served as the Corporation's Senior Vice
President, Advanced Technology, and as a director since its inception in 1987.
He joined MIT as a Research Scientist in 1981 and was a Group Leader as well as
a member of the management team on several projects. Dr. Smith specializes in
radio frequency and plasma engineering. Dr. Smith earned his Master of Science
degree and Ph.D. in Electrical Engineering from the University of Wisconsin,
Madison, and his Bachelor of Science degree from Davidson College.
MR. ROBERT R. ANDERSON has served as a director of the Corporation
since October 1995. Previously, Mr. Anderson co-founded and served as Chief
Financial Officer and Chief Operating Officer of KLA Instruments Corporation,
the leading manufacturer of yield monitoring and process control systems for the
semiconductor manufacturing industry, from which he retired in 1994. Prior to
co-founding KLA, Mr. Anderson was Chief Financial Officer of Computervision
Corporation, which develops and markets software for design automation and
product data management. Mr. Anderson is Chairman of the Board of Directors of
Silicon Valley Research, a leading manufacturer of EDA software for integrated
circuit design and manufacture. Mr. Anderson attended Bentley College.
MR. MICHEL DE BEAUMONT has served as a director of the Corporation
since January 1993. Since 1981, Mr. de Beaumont has served as a co-founder and
director of American Equities Overseas (U.K.) Ltd. of London, England ("American
Equities"), a private securities brokerage and corporate finance firm. From 1978
to 1981, Mr. de Beaumont served as a Vice President in the London, England
Office of American Securities Corp. ("American Securities"), a clearing house
for American Equities. Mr. de Beaumont has also previously served as a Vice
President at Smith Barney Harris Upham and Oppenheimer & Co. Mr. de Beaumont
holds degrees in Advanced Mathematics, Physics and Chemistry from the
Universities of Poitiers and Paris, and a degree in Business Administration from
the University of Paris.
MR. JOHN R. BERTUCCI has served as a director of the Corporation since
September 1994. Mr. Bertucci has been President, Chief Executive Officer and a
director of MKS Instruments, Inc. ("MKS"), a privately held manufacturer and
seller of pressure control instruments for vacuum processes, since 1974. Mr.
Bertucci received a Master of Science degree in Industrial Administration and a
Bachelor of Science degree in Metallurgical Engineering from Carnegie-Mellon
University.
MR. HANS-JOCHEN KAHL has served as a director of the Corporation since
October 1995. Mr. Kahl currently serves as a consultant to Ebara, a Japanese
manufacturer of industrial water pumps and vacuum process equipment for the
semiconductor industry. Previously, Mr. Kahl was employed by Leybold AG,
formerly Leybold-Heraeus GmbH ("Leybold"), a leading international manufacturer
of vacuum pumps and other vacuum process equipment for the semiconductor
industry. Mr. Kahl
6
served as a managing director of Leybold, where he was primarily responsible
for sales, marketing and strategic planning. Mr. Kahl was appointed to the
Board of Directors of Leybold in 1987.
MR. JORDAN L. GOLDING, a certified public accountant, has served as an
advisor to the Board of Directors since 1989. Mr. Golding served as a partner in
KPMG Peat Marwick LLP until his retirement in 1988, where his client
responsibilities included high technology, merchandising, banking and emerging
companies. After service in the U.S. Navy, he became a partner in Golding,
Golding & Company, which in 1967 merged with KPMG Peat Marwick LLP. He has
served as President of the Massachusetts Society of Certified Public Accountants
and was Chairman of the Management Advisory Services Committee of the American
Institute of Certified Public Accountants. Mr. Golding presently serves as a
consultant and a director of Marcliff Corporation, the privately held parent
company of Marson Corporation (a manufacturer and distributor of various
automobile parts), and of Canadian Western Bank, a publicly held commercial
bank. Mr. Golding serves on the Advisory Board of New Balance, Inc., the
privately held parent company of New Balance Athletic Shoe, Inc., and of
Charrette Corporation, a publicly held art and graphics supplies company, and as
a consultant to other corporations. Mr. Golding earned a Master of Business
Administration degree from Harvard Business School, and graduated from Harvard
College.
EXECUTIVE OFFICERS AND KEY EMPLOYEES
The executive officers and certain other key employees of the
Corporation, their ages and positions held in the Corporation are as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
NAME AGE POSITION
Richard S. Post, Ph.D................ 53 President, Chief Executive Officer and
Chairman of the Board of Directors
John M. Tarrh ........................... 49 Senior Vice President, Finance, Secretary
and Treasurer
Donald K. Smith, Ph.D............. 44 Senior Vice President, Advanced
Technology
Paul A. Blackborow.................. 37 Vice President, Customer Operations
John D. Lloyd ........................... 56 Vice President, Manufacturing
Operations
Michael A. Silvia ..................... 44 Vice President, Business Operations
Robert E. Bettilyon ................... 47 Controller
William M. Holber, Ph.D.......... 42 Director of Technical Marketing
Lorrie Ferraro............................ 34 Director of Human Resources
Richard W. Hartnell.................. 55 Director of Operations of AGL
</TABLE>
7
The following is a brief summary of the background of each executive
officer or key employee of the Corporation, other than Drs. Post and Smith and
Mr. Tarrh, whose backgrounds are described above:
MR. PAUL A. BLACKBOROW has served as the Corporation's Vice President,
Customer Operations since August 1995. Prior to this Mr. Blackborow served as
the Corporation's Manager of Customer Operations since September 1994.
Previously, Mr. Blackborow served as Director of Business Development for the
Corporation. Prior to joining the Corporation, from 1991 to 1993 Mr. Blackborow
was employed by W.E.D. Ltd., a British manufacturer of robotics equipment, where
he was responsible for the establishment of a new manufacturing facility. Prior
to his employment with W.E.D. Ltd., from 1987 to 1991, Mr. Blackborow was
employed as President by Plasma Technology, Inc. Mr. Blackborow received
Bachelor and Master of Science degrees in Engineering from Cambridge University.
MR. JOHN D. LLOYD has been the Corporation's Vice President,
Manufacturing Operations since June 1994. Prior to joining the Corporation, from
1988 to 1993 Mr. Lloyd was Director of Manufacturing at Coherent General, Inc.,
a private manufacturer of industrial lasers and laser systems for materials
processing and medical applications. Mr. Lloyd received a Master of Science
degree in Industrial Management from Purdue University, and a Bachelor of
Science degree in Electrical Engineering from Clarkson University.
MR. MICHAEL A. SILVIA is currently Vice President, Business Operations.
He previously served as the Corporation's Vice President of Operations from
December 1991 through June 1994. Mr. Silvia joined the Corporation in 1988 as
Materials Manager and was named Operations Manager in October 1989. Originally a
contracts manager with the Electronic Systems Divisions of the United States Air
Force/Air Force Systems Command, Mr. Silvia joined MIT in 1980 as the Purchasing
Manager for the combined requirements of the Plasma Fusion Center and National
Magnet Laboratory and in 1987 became Assistant Director of Purchasing for all of
MIT. Mr. Silvia earned a Bachelor of Science degree in Finance at the University
of Massachusetts at Dartmouth.
MR. ROBERT E. BETTILYON has been the Corporation's Controller since
August 1993. From 1983 to 1993, Mr. Bettilyon was Controller at Coherent
General, Inc., a private manufacturer of industrial lasers and laser systems for
materials processing and medical applications, and has served at each of its
Massachusetts, Tokyo and Munich facilities. Mr. Bettilyon previously served as a
Senior Financial Planning Analyst at Standard Oil of Ohio from 1980 to 1983, and
as an Audit Senior at Touche Ross (now Deloitte and Touche), from 1977 to 1980.
Mr. Bettilyon holds a Bachelor of Science degree in Accounting from the
University of Utah and is a Certified Public Accountant.
WILLIAM M. HOLBER, PH.D. has been the Corporation's Director of
Technical Marketing since July 1995. From May 1993 to July 1995, Dr. Holber was
the Corporation's Director of Technology Development for OEM products. From 1986
to May 1993, Dr. Holber was a research staff member
8
for the IBM T.J. Watson Research Center where he performed research on various
aspects of electron cyclotron resonance (ECR) plasmas for microelectronic
applications. Dr. Holber received a Ph.D. in Applied Physics from Columbia
University, a Master of City and Regional Planning degree from Harvard
University, Kennedy School of Government, a Master of Science degree in Physics
from the University of Chicago and a Bachelor of Science degree from Brown
University.
MS. LORRIE FERRARO has been the Corporation's Director of Human
Resources since June 1995. Prior to joining the Corporation, Ms. Ferraro owned
and operated a privately-held human resources consulting firm, AmCan Marketing,
in Lowell, Massachusetts, where her clients included AVID Technologies and Muro
Pharmaceutical. Prior to founding AmCan Marketing in 1990, Ms. Ferraro was
employed from 1989 to 1990 by Metcalf and Eddy Companies, Inc., as Human
Resource Manager. Ms. Ferraro received an Associate degree in Human Resources
from McGill University and an Associate degree in Education from Northern Lights
College.
MR. RICHARD W. HARTNELL has served as Director of Operations for AGL
since 1994. Prior to joining the Corporation, from 1979 to 1993, Mr. Hartnell
was Director of Operations for Teledyne CME, a publicly-held electronics
manufacturing company, where he was responsible for manufacturing, manufacturing
engineering and quality control. Mr. Hartnell received a Bachelor of Science
degree in Electrical Engineering from San Jose State University.
9
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth, as of October 1, 1996, certain
information concerning stock ownership of the Corporation by (i) each person
known by the Corporation to own of record or be the beneficial owner of more
than five percent (5%) of the Corporation's Common Stock, (ii) each of the
Corporation's directors, and (iii) all directors and officers as a group. Except
as otherwise indicated, the stockholders listed in the table have sole voting
and investment powers with respect to the shares indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
NAME AND ADDRESS NUMBER OF SHARES PERCENTAGE
OF BENEFICIAL OWNER(1) BENEFICIALLY OWNED(2) OF CLASS
---------------------- --------------------- ----------
Kopp Investment Advisors, Inc............. 845,515 19.0%
Richard S. Post, Ph.D.(3)................. 408,535 9.2%
Donald K. Smith, Ph.D.(4) ................ 312,252 7.0%
John M. Tarrh(5).......................... 281,858 6.3%
Michel de Beaumont(6)..................... 55,012 1.2%
John Bertucci(7).......................... 59,000 1.3%
Robert R. Anderson(8) .................... 5,000 *
Hans-Jochen Kahl(8)....................... 5,000 *
All Officers and Directors
as a Group (10 persons)
(3)(4)(5)(6)(7)(8)(9)(10)(11). . . . . . . . . . 1,185,890 26.1%
- ---------------------------------------
* Less than one percent (1%)
</TABLE>
(1) The address for all officers and directors is c/o Applied Science and
Technology, Inc., 35 Cabot Road, Woburn, Massachusetts 01801. The
address for Kopp Investment Advisors, Inc. is 6600 France Avenue South,
#672, Edina, Minnesota 55435.
(2) Pursuant to the rules of the Securities and Exchange Commission, shares
of Common Stock that an individual or group has a right to acquire
within 60 days pursuant to the exercise of options or warrants are
deemed to be outstanding for the purpose of computing the percentage
ownership of such individual or group, but are not deemed to be
outstanding for the purpose of computing the percentage of ownership of
any other person in the table.
10
(3) Includes (i) 3,200 shares of Common Stock owned by Dr. Post as
custodian for his two children; (ii) 12,500 shares of Common Stock
owned by Dr. Post's wife; (iii) 2,000 shares of Common Stock issuable
upon the exercise of the vested portion of an option to purchase up to
5,000 shares, at an exercise price of $11.125 per share, which expires
on July 2, 2000; (iv) 5,000 shares of Common Stock issuable upon the
exercise of the vested portion of an option to purchase up to 15,000
shares, at an exercise price of $12.625 per share, which expires on
December 28, 2000; and (v) 6,000 shares of Common Stock issuable upon
the exercise of the vested portion of an option to purchase up to
30,000 shares, at an exercise price of $9.625 per share, which expires
on August 5, 2001.
(4) Includes (i) 800 shares of Common Stock issuable upon the exercise of
the vested portion of an option to purchase up to 2,000 shares, at an
exercise price of $11.125 per share, which expires on July 2, 2000;
(ii) 3,000 shares of Common Stock issuable upon the exercise of the
vested portion of an option to purchase up to 15,000 shares, at an
exercise price of $12.625 per share, which expires on December 28,
2000; and (iii) 3,000 shares of Common Stock issuable upon the exercise
of the vested portion of an option to purchase up to 15,000 shares at
an exercise price of $9.625 per share, which expires on August 5, 2001.
(5) Includes (i) an aggregate of 876 shares of Common Stock owned by Mr.
Tarrh's wife and minor son; (ii) 400 shares of Common Stock issuable
upon the exercise of the vested portion of an option to purchase up to
1,000 shares, at an exercise price of $11.125 per share, which expires
on July 2, 2000; (iii) 1,400 shares of Common Stock issuable upon the
exercise of the vested portion of an option to purchase up to 7,000
shares at an exercise price of $12.625 per share, which expires on
December 28, 2000; and (iv) 1,300 shares of Common Stock issuable upon
the exercise of the vested portion of an option to purchase up to 6,500
shares at an exercise price of $9.625 per share, which expires on
August 5, 2001. Excludes 12,500 shares of Common Stock held by Mr.
Tarrh's father and sisters, in which Mr. Tarrh disclaims any beneficial
interest.
(6) Includes (i) 10,487 shares of Common Stock held by American Equities,
of which Mr. de Beaumont is a director; (ii) 35,525 shares of Common
Stock owned by Samisa Investment Corp., an investment trust of which
Mr. de Beaumont is a beneficiary; (iii) 4,000 shares of Common Stock
issuable upon the exercise of the vested portion of an option to
purchase up to 4,000 shares, at an exercise price of $7.06 per share,
which expires on November 18, 2004; and (iv) 5,000 shares of Common
Stock issuable upon the exercise of the vested portion of an option to
purchase up to 12,000 shares at an exercise price of $16.00 per share,
which expires on November 15, 2005.
(7) Includes (i) 15,000 shares of Common Stock owned directly by Mr.
Bertucci; (ii) 35,000 shares of Common Stock held by MKS Instruments,
Inc., of which Mr. Bertucci is the majority shareholder; (iii) 5,000
shares of Common Stock issuable upon the exercise of the vested portion
of an option to purchase up to 12,000 shares at an exercise price of
$16.00 per share, which expires on November 15, 2005; and (iv) 4,000
shares of Common Stock issuable upon the exercise of the vested portion
of an option to purchase up to 4,000 shares, at an exercise price of
$7.06 per share, which expires on November 18, 2004.
11
(8) Includes 5,000 shares of Common Stock issuable upon the exercise of the
vested portion of an option to purchase up to 12,000 shares at an
exercise price of $16.00 per share, which expires on November 15, 2005.
(9) Includes the following shares and options owned or beneficially held by
Paul A. Blackborow, the Corporation's Vice President, Customer
Operations: (i) 9,000 shares of Common Stock; (ii) 2,000 shares of
Common Stock issuable upon the exercise of the vested portion of an
option to purchase up to 4,000 shares, at an exercise price of $5.875
per share, which expires on October 17, 1998; (iii) 4,000 shares of
Common Stock issuable upon the exercise of the vested portion of an
option to purchase up to 10,000 shares, at an exercise price of $11.125
per share, which expires on July 2, 2000; (iv) 800 shares of common
stock issuable upon the exercise of the vested portion of an option to
purchase up to 4,000 shares at an exercise price of $12.625 per share,
which expires on December 28, 2000; and (v) 1,300 shares of Common
Stock issuable upon the exercise of the vested portion of an option to
purchase up to 6,500 shares at an exercise price of $9.625 per share,
which expires on August 5, 2001.
(10) Includes the following shares and options owned or beneficially held by
John D. Lloyd, the Corporation's Vice President, Manufacturing
Operations: (i) 2,000 shares of Common Stock; (ii) 1,200 shares of
Common Stock held in a retirement account; (iii) 2,000 shares of Common
Stock issuable upon the exercise of the vested portion of an option to
purchase up to 6,000 shares, at an exercise price of $5.875 per share,
which expires on October 17, 1999; (iv) 2,000 shares of Common Stock
issuable upon the exercise of the vested portion of an option to
purchase up to 5,000 shares, at an exercise price of $11.125 per share,
which expires on July 2, 2000; (v) 800 shares of Common Stock issuable
upon the exercise of the vested portion of an option to purchase up to
4,000 shares at an exercise price of $12.625 per share, which expires
on December 28, 2000; and (vi) 700 shares of Common Stock issuable upon
the exercise of the vested portion of an option to purchase up to 3,500
shares at an exercise price of $9.625 per share, which expires on
August 5, 2001. Excludes 300 shares of Common Stock held by Mr. Lloyd's
two adult children, of which Mr. Lloyd disclaims any beneficial
interest.
(11) Includes the following shares and options owned or beneficially held by
Michael A. Silvia, the Corporation's Vice President, Business
Operations: (i) 18,233 shares of Common Stock; (ii) 2,500 shares of
Common Stock issuable upon the exercise of the vested portion of an
option to purchase up to 2,500 shares, at an exercise price of $5.00
per share, which expires on November 30, 1997; (iii) 4,000 shares of
Common Stock issuable upon the exercise of the vested portion of an
option to purchase up to 5,000 shares, at an exercise price of $8.00
per share, which expires on July 27, 1998; (iv) 3,200 shares of Common
Stock issuable upon the exercise of the vested portion of an option to
purchase up to 4,000 shares, at an exercise price of $6.875 per share,
which expires on October 18, 1998; (v) 4,000 shares of Common Stock
issuable upon the exercise of the vested portion of an option to
purchase up to 10,000 shares, at an exercise price of $11.125 per
share, which expires on July 2, 2000; (vi) 800 shares of Common Stock
issuable upon the exercise of the vested portion of an option to
purchase up to 4,000 shares, at an exercise price of $12.625 per share,
which expires on December 28, 2000; and (vii) 700 shares of Common
Stock issuable upon the exercise of the vested portion
12
of an option to purchase up to 3,500 shares at an exercise price of
$9.625 per share, which expires on August 5, 2001.
COMPENSATION OF OFFICERS AND DIRECTORS
EXECUTIVE OFFICERS' COMPENSATION
The table on the following page sets forth the compensation paid to Dr.
Post, the Corporation's Chief Executive Officer, President and Chairman of the
Board of Directors, Mr. Tarrh, the Corporation's Senior Vice President, Finance,
Dr. Smith, the Corporation's Senior Vice President, Advanced Technology, Mr.
Silvia, the Corporation's Vice President, Business Operations, and Mr. Lloyd,
the Corporation's Vice President, Manufacturing Operations during Fiscal Years
1996, 1995 and 1994.
13
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation
------------------------------------
Annual Compensation Awards Payouts
- ------------------------------------------------------------------------------------------ ------------------------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Securities
Name and Restricted Underlying LTIP All Other
Principal Other Annual Stock Options/ Payouts Compen-
Position Year Salary(1) Bonus Compensation(2) Awards SARs (#) $ sation(3)
- --------- ---- --------- ----- --------------- ------ -------- -------- ---------
Richard S. Post 1996 $142,500 $57,200 -0- -0- 30,000 -0- $2,344
President, Chief 1995 $130,000 $17,679 -0- -0- -0- -0- $1,739
Executive Officer 1994 $130,661 $ 9,180 -0- -0- -0- -0- $1,542
and Chairman of the
Board
Donald K. Smith 1996 $114,000 $40,040 -0- -0- 17,000 -0- $1,534
Senior Vice President, 1995 $104,000 $16,143 -0- -0- -0- -0- $1,512
Advanced Technology, 1994 $104,000 $ 9,115 -0- -0- -0- -0- $1,237
and Director
John M. Tarrh 1996 $95,366 $28,710 -0- -0- 8,000 -0- $1,761
Senior Vice President, 1995 $87,006 $10,139 -0- -0- -0- -0- $1,255
Finance, Secretary, 1994 $84,309 $ 9,244 -0- -0- -0- -0- $ 909
Treasurer and Director
Michael A. Silvia 1996 $93,190 $23,379 -0- -0- 14,000 -0- $1,772
Vice President, 1995 $85,000 $15,021 $ 63 -0- -0- -0- $1,235
Business Operations 1994 $83,968 $ 8,752 -0- -0- 9,000 -0- $1,047
John D. Lloyd 1996 $93,437 $23,100 -0- -0- 9,000 -0- $1,672
Vice President, 1995 $80,846 $ 7,000 -0- -0- 6,000 -0- $ 913
Manufacturing Operations 1994 $ 3,077 -0- -0- -0- -0- -0- -0-
</TABLE>
(1) Amounts shown indicate cash compensation earned and received by Drs.
Post and Smith and Messrs. Silvia, Tarrh and Lloyd; no amounts were
earned but deferred at their election. Drs. Post and Smith and Messrs.
Silvia, Tarrh and Lloyd participate in the Corporation's group health
and life insurance programs and other benefits generally available to
all employees of the Corporation.
(2) Represents the difference between the exercise price and fair market
value of the Common Stock at the time of exercise of certain options to
purchase Common Stock held by Michael A. Silvia.
(3) Amounts shown represent premium payments on life and long-term
disability insurance policies for Drs. Post and Smith and Messrs.
Silvia, Tarrh and Lloyd (which are available to all employees of the
Corporation) and contributions paid by the Corporation in connection
with its 401(k) Plan.
14
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1996
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
(a) (b) (c) (d) (e)
- -------------------------- --------------------------------- ------------------- ----------
Number of Value of
Securities Unexercised
Underlying In-the-Money
Unexercised Options at
Options Fiscal Year-
Value at Fiscal Year- End Exercisable/
Shares Acquired Realized End Exercisable/ Unexercisable
Name on Exercise ($) Unexercisable ($)(1)
- -------------------------- ------------------- ------------- ---------------- -------------
John D. Lloyd 4,000 $5.875/sh 4,800/10,200 44,100/97,275
Michael A. Silvia 10,000 $5.50/sh 14,500/11,000 121,101/120,650
</TABLE>
(1) In-the-Money options are those options for which the fair market value
of the underlying Common Stock is greater than the exercise price of
the option. On June 29, 1996 the last day of Fiscal Year 1996, the fair
market value of the Corporation's Common Stock underlying the options
(as determined by the last sale price quoted on NASDAQ/NMS) was $12.00.
OPTION GRANTS IN FISCAL YEAR 1996
<TABLE>
<CAPTION>
Potential Realizable Value
at Assumed Annual Rates of
Stock Price Appreciation
Individual Grants For Option Term (1)(5)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
(a) (b) (c) (d) (e) (f) (g)
- ------------------------ ----------------- ----------- ----------- ----------- --------- ---------
% of Total
Number of Options
Securities Granted to
Underlying Employees Exercise or
Options in Fiscal Base Price Expiration
Name Granted (#)(1)(2) Year(3) ($/Sh) Date(4) 5% 10%
- ------------------------ ----------------- ------------ ----------- ----------- --------- ---------
Richard S. Post 5,000 2.1% $11.1250 07/02/2000 $ 15,368 $ 33,960
25,000 10.5% $12.6250 12/28/2000 $ 87,201 $ 192,692
Donald K. Smith 2,000 .8% $11.1250 07/02/2000 $ 6,147 $ 13,584
15,000 6.3% $12.6250 12/28/2000 $ 52,321 $ 115,615
Michael A. Silvia 10,000 4.2% $11.1250 07/02/2000 $ 30,736 $ 67,919
4,000 1.7% $12.6250 12/28/2000 $ 13,952 $ 30,831
John M. Tarrh 1,000 .4% $11.1250 07/02/2000 $ 3,074 $ 6,792
7,000 2.9% $12.6250 12/28/2000 $ 24,416 $ 53,954
- ----------------------------------------------
</TABLE>
15
(1) None of the above named individuals has exercised any of the options
granted during Fiscal Year 1996.
(2) Options granted in Fiscal Year 1996 are exercisable immediately after
the grant date, with 20% of the shares covered thereby becoming
exercisable at that time and an additional 20% of the option shares
becoming exercisable on each successive anniversary date, with full
vesting occurring on the fifth anniversary date.
(3) In Fiscal Year 1996, options to purchase a total of 237,550 shares of
Common Stock were granted to employees of the Corporation, including
executive officers.
(4) The options are subject to earlier termination upon certain events
related to termination of employment.
(5) The dollar gains under these columns result from calculations
discussing hypothetical growth rates as set by the Commission and are
not intended to forecast future price appreciation of the Common Stock.
COMPENSATION OF DIRECTORS
Messrs. Anderson, Bertucci, and Kahl receive $1,000 per meeting for
participation in Board of Directors meetings, and $500 per meeting for
participation in Committee meetings. All non-employee directors receive
reimbursement of reasonable travel expenses.
In addition, pursuant to the Corporation's Formula Plan, effective on
and commencing as of November 16, 1995, all non-employee directors received a
grant of options to purchase twelve thousand (12,000) shares of Common Stock at
an exercise price equal to the fair market value of the Common Stock on the date
of grant. Under the Formula Plan, options to purchase one thousand (1,000)
shares of Common Stock will vest immediately and additional options to purchase
one thousand (1,000) shares of Common Stock will vest quarterly, subject to the
option holder's continued service as a Director of the Corporation. Upon the
vesting of these options, each non-employee director will receive an additional
grant of options to purchase twelve thousand (12,000) shares of Common Stock, to
vest on the same terms as above.
EMPLOYMENT AGREEMENTS
The Corporation has entered into employment agreements with Drs. Post
and Smith and Mr. Tarrh which are renewable annually. These agreements provide
for base salaries of $170,000, $117,000, and $103,000 respectively, during the
fiscal year ended June 28, 1997 ("Fiscal Year 1997"). However, subsequent to the
end of Fiscal Year 1996, Drs. Post and Smith and Mr. Tarrh recommended and
implemented a 10% reduction in their base salaries as part of an expense
reduction effort by the Corporation. Bonuses may be granted by the Board of
Directors and each of these officers is eligible to receive bonuses if certain
profit levels are achieved pursuant to the Corporation's bonus plan (the "Bonus
Plan"). Pursuant to the Bonus Plan, Drs. Post and Smith, and Mr. Tarrh received
bonuses of $57,200, $40,040 and $28,710, respectively, during Fiscal Year 1996.
Each individual is entitled to
16
receive benefits offered to the Corporation's employees generally and to receive
twelve (12) months base salary as severance in the event his employment is
terminated by the Corporation without cause. In addition, the employment
agreements preclude each individual from competing with the Corporation during
his employment and for at least two years thereafter, from disclosing
confidential information, and each agreement contains an ownership provision in
the Corporation's favor for techniques, discoveries and inventions arising
during the term of employment.
401(K) PLAN
Effective July 1990, the Corporation adopted and established a 401(k)
Employee Benefit Plan (the "401(k) Plan"). Under the 401(k) Plan, any employee
who has completed 90 days of service and has attained the age of 21 years is
eligible to participate. Under the terms of the 401(k) Plan, an employee may
defer up to 15% of his or her compensation through contributions to the 401(k)
Plan. Also, the Corporation may make discretionary matching contributions on
behalf of the participating employees. Amounts contributed to the 401(k) Plan by
the Corporation are subject to a six year vesting schedule. The Corporation made
voluntary contributions to the 401(k) Plan during Fiscal Year 1996 of $72,547 on
behalf of all eligible employees.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
On October 15, 1992, the Securities and Exchange Commission adopted
substantial amendments to its disclosure rules relating to executive
compensation. To adequately address and comply with these rules, the Board of
Directors established a Compensation Committee (the "Committee") in November
1994. The Committee is currently composed of Mr. Kahl, with Mr. Golding serving
as an advisor, and is responsible for setting and administering the policies
which govern annual compensation for the Corporation's executives. Following
review and approval by the Committee of the compensation policies, all issues
pertaining to executive compensation are submitted to the Board of Directors for
approval. Following the Annual Meeting, the Board of Directors may appoint an
additional non-employee director to join Mr. Kahl on the Compensation Committee.
This report is not incorporated by reference in prior Securities Act of
1933 and Securities Exchange Act of 1934 filings made by the Corporation that
might have incorporated future filings in their entirety, except to the extent
that the Corporation specifically incorporates this information by reference,
and should not be otherwise deemed filed under such Acts.
The Committee believes that the primary objectives of the Corporation's
compensation policies are to attract and retain a management team that can
effectively implement and execute the Corporation's strategic business plan.
These compensation policies include (i) an overall management compensation
program that is competitive with management compensation programs at companies
of similar size; (ii) short-term bonus incentives for management to meet the
Corporation's net income performance goals; and (iii) long-term incentive
compensation in the form of stock options and other long-term equity
compensation that will encourage management to continue to focus on shareholder
return.
17
The Committee's goal is to use compensation policies to closely align
the interests of the Corporation with the interests of shareholders so that the
Corporation's management have incentives to achieve short-term performance goals
while building long-term value for the Corporation's shareholders. The Committee
will review its compensation policies from time to time in order to determine
the reasonableness of the Corporation's compensation programs and to take into
account factors which are unique to the Corporation.
The Committee has entered into employment agreements with Drs. Post and
Smith, and Mr. Tarrh. These agreements are renewable annually, and provide for
termination for cause as well as termination without cause and limit competition
if the officer's employment is terminated.
Base Salaries. For Fiscal Year 1997, Dr. Post's base salary has been
increased from $143,000 in Fiscal Year 1996 to $170,000 per annum; Dr. Smith's
base salary has been increased from $114,000 in Fiscal Year 1996 to $117,000 per
annum; and Mr. Tarrh's base salary has been increased from $97,500 in Fiscal
Year 1996 to $103,000. The Compensation Committee believes that these salaries
reflect base salaries paid to senior officers of other companies of similar size
and also reflect improvements in the Corporation's financial performance to
date. However, subsequent to the fiscal year end, Drs. Post and Smith and Mr.
Tarrh recommended and implemented a 10% reduction in their base salaries as part
of an expense reduction effort by the Corporation.
Bonus Plan. To further incentivize management to continue to improve
operating results, in August 1994, the Board of Directors implemented the Bonus
Plan. Pursuant to the Bonus Plan, the Board of Directors may grant bonuses to
certain executive officers if specified profit levels are achieved. The amounts
to be distributed pursuant to the Bonus Plan are determined by the amount by
which operating profits exceed the operating profit goal, which is established
annually. The Committee believes that the Bonus Plan provides significant
incentive to the executive officers of the Corporation to exceed the operating
profit goal.
Compensation for Chief Executive Officer. Dr. Post's compensation was
based upon careful analysis of other comparable public companies' Chief
Executive Officers' compensation and Dr. Post's efforts and success in the
following areas: improving the Corporation's operating results; establishing
strategic goals and objectives for the long-term growth of the Corporation; and
raising equity capital needed to allow the Corporation to advance in its
strategic goals.
COMPENSATION COMMITTEE
Hans-Jochen Kahl, Chairman
18
PERFORMANCE GRAPH
The following graph compares the cumulative total stockholder return
(assuming reinvestment of dividends) from investing $100 on November 10, 1993
(the day the Corporation's Common Stock began trading separately on The National
Association of Securities Dealers Automated Quotation System ("NASDAQ")), and
plotted at the end of Fiscal Years 1994, 1995 and 1996, in each of (i) the
Corporation's Common Stock, (ii) the NASDAQ Market Index of companies (the
"NASDAQ Market Index"); and (iii) a Peer Group Index based on Standard Industry
Classification Number 3679, Electronic Components (the "SIC Code Index"), which
consists of other companies in the Electronic Component industry.
CUMULATIVE TOTAL RETURN
AMONG APPLIED SCIENCE & TECHNOLOGY,
NASDAQ MARKET INDEX AND SIC CODE INDEX
ASSUMES $100 INVESTED ON NOV. 1993
ASSUMES DIVIDEND REINVESTED
FISCAL YEAR ENDING JUNE 1996
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
11/10/93 07/02/94 07/01/95 06/29/96
-------- -------- -------- --------
Applied Science and Technology, Inc. ....... $100.00 $ 55.68 $101.14 $109.09
NASDAQ Market Index ........................ $100.00 $ 106.38 $142.80 $183.35
SIC Code Index.............................. $100.00 $ 99.38 $116.55 $146.72
</TABLE>
19
PRICE RANGE OF COMMON STOCK
The Corporation's Common Stock and Redeemable Warrants have been traded
on the National Association of Securities Dealers Automated Quotation System -
National Market System ("NASDAQ/NMS") under the symbols "ASTX" and "ASTXW,"
respectively. On September 28, 1996, the closing bid and ask prices for the
Corporation's Common Stock as reported by NASDAQ/NMS were $7 7/8 and $8 1/2,
respectively, and the bid and asked prices for the Redeemable Warrants were $5/8
and $3/4, respectively. As of September 28, 1996, the Corporation had 166
holders of record of its Common Stock. Management believes that there are
approximately 1800 beneficial owners of its Common Stock.
For the periods indicated, the following table sets forth the high and
low closing sale prices for the Common Stock as reported by NASDAQ/NMS from July
3, 1994 through September 28, 1996. Such quotations represent interdealer
quotations without adjustment for retail markups, markdowns or commissions and
may not represent actual transactions.
SALE
----
HIGH LOW
---- ---
1995
First Quarter ...................... $ 7 1/8 $ 5 3/4
Second Quarter ..................... 7 1/2 5 1/2
Third Quarter ...................... 8 3/4 5 1/2
Fourth Quarter ..................... 12 5/8 7 3/8
1996
First Quarter ...................... $ 18 1/4 $ 10 3/4
Second Quarter ..................... 16 3/4 15 1/2
Third Quarter....................... 17 12 5/8
Fourth Quarter...................... 23 1/2 9
1997
First Quarter....................... $ 14 1/4 $ 7 3/4
STOCK OWNERSHIP AND TRADING REPORTS
Section 16(a) of the Securities Exchange Act of 1934, as amended,
("Section 16(a)") requires executive officers, directors, and persons who
beneficially own more than ten percent (10%) of the Corporation's stock to file
initial reports of ownership on Form 3 and reports of changes in ownership on
Form 4 with the Securities and Exchange Commission (the "Commission") and any
national securities exchange on which the Corporation's securities are
registered. Executive officers, directors
20
and greater than ten percent (10%) beneficial owners are required by the
Commission's regulations to furnish the Corporation with copies of all Section
16(a) forms they file.
Based solely on a review of the copies of such forms furnished to the
Corporation and written representations from the executive officers and
directors, the Corporation believes that all its executive officers, directors,
and greater than ten percent (10%) beneficial owners complied with all
applicable Section 16(a) filing requirements, with the following exceptions: Mr.
Paul Blackborow, the Corporation's Vice President, Customer Operations filed one
(1) late Form 4, reporting one (1) transaction and Mr. Michael Silvia, the
Corporation's Vice President, Business Operations filed one (1) late Form 4,
reporting one (1) transaction.
DIVIDEND POLICY
The Corporation has not paid dividends on its Common Stock since its
inception and has no intention of paying any dividends in the foreseeable
future. The Corporation's current credit facility arrangements restrict the
Corporation's ability to declare cash dividends without the lender's prior
written consent. The Corporation intends to reinvest future earnings, if any, in
the development and expansion of its business. Any declaration of dividends will
be at the election of the Board of Directors and will depend upon the earnings,
capital requirements and financial position of the Corporation, general economic
conditions, requirements of any bank lending arrangements which may then be in
place, and other pertinent factors.
PROPOSAL NO. 2
ACCOUNTING MATTERS AND RATIFICATION OF AUDITORS
The persons named in the enclosed proxy will vote to ratify the
selection of KPMG Peat Marwick LLP as independent auditors for the fiscal year
ending June 28, 1997 unless otherwise directed by the stockholders. A
representative of KPMG Peat Marwick LLP is expected to be present at the Annual
Meeting, and will have the opportunity to make a statement and answer questions
from stockholders if he or she so desires.
VOTING AT MEETING
The Board of Directors has fixed October 1, 1996 as the record date for
the determination of stockholders entitled to vote at this meeting. At the close
of business on that date, there were outstanding and entitled to vote 4,448,475
shares of Common Stock.
SOLICITATION OF PROXIES
The cost of solicitation of proxies will be borne by the Corporation.
In addition to the solicitation of proxies by mail, officers and employees of
the Corporation may solicit in person or by telephone. The Corporation may
reimburse brokers or persons holding stock in their names, or in the names of
their nominees, for their expense in sending proxies and proxy material to
beneficial owners.
20
REVOCATION OF PROXY
Subject to the terms and conditions set forth herein, all proxies
received by the Corporation will be effective, notwithstanding any transfer of
the shares to which such proxies relate, unless prior to the Annual Meeting the
Corporation receives a written notice of revocation signed by the person who, as
of the record date, was the registered holder of such shares. The notice of
revocation must indicate the certificate number or numbers of the shares to
which such revocation relates and the aggregate number of shares represented by
such certificate(s).
STOCKHOLDER PROPOSALS
In order to be included in proxy material for the 1997 Annual Meeting,
tentatively scheduled for November 13, 1997, stockholders' proposed resolutions
must be received by the Corporation on or before July 1, 1997. The Corporation
suggests that proponents submit their proposals by certified mail, return
receipt requested, addressed to the President of the Corporation.
ANNUAL REPORT
THE CORPORATION IS PROVIDING TO EACH STOCKHOLDER, TOGETHER WITH THIS
PROXY STATEMENT WITHOUT CHARGE, A COPY OF THE CORPORATION'S ANNUAL REPORT,
INCLUDING THE FINANCIAL STATEMENTS FOR THE CORPORATION'S MOST RECENT FISCAL YEAR
ENDED JUNE 29, 1996.
MISCELLANEOUS
Management does not know of any other matter which may come before the
Annual Meeting. However, if any other matters are properly presented to the
Annual Meeting, it is the intention of the persons named in the accompanying
proxy to vote, or otherwise act, in accordance with their judgment on such
matters.
By Order of the Board of Directors
John M. Tarrh
Secretary
October 18, 1996
MANAGEMENT HOPES THAT STOCKHOLDERS WILL ATTEND THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND, YOU ARE URGED TO COMPLETE, DATE, SIGN, AND
RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. PROMPT RESPONSE WILL
GREATLY FACILITATE ARRANGEMENTS FOR THE ANNUAL MEETING AND YOUR COOPERATION WILL
BE APPRECIATED. STOCKHOLDERS WHO ATTEND THE ANNUAL MEETING MAY VOTE THEIR STOCK
PERSONALLY EVEN THOUGH THEY HAVE SENT IN THEIR PROXIES.
22
APPLIED SCIENCE AND TECHNOLOGY, INC.
PROXY OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD NOVEMBER 21, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
THE UNDERSIGNED hereby appoints Richard S. Post and John M. Tarrh as
Proxies, with full power of substitution to each, to vote for and on behalf of
the undersigned at the Annual Meeting of Stockholders of APPLIED SCIENCE AND
TECHNOLOGY, INC. to be held at the Corporation's offices located at 35 Cabot
Road, Woburn, Massachusetts 01801, on Thursday, November 21, 1996 at 10:30 a.m.,
and at any adjournment or adjournments thereof. The undersigned hereby directs
the said Richard S. Post and John M. Tarrh to vote in accordance with their
judgment on any matters that may properly come before the Annual Meeting, all as
indicated in the Notice of the Annual Meeting, receipt of which is hereby
acknowledged, and to act on the following matters set forth in such notice as
specified by the undersigned:
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
ELECTION OF DIRECTORS AND FOR PROPOSAL 2.
(1) Proposal to elect three (3) members of the Board of Directors of the
Corporation, each of whom is currently serving as a Director of the
Corporation.
INSTRUCTION: TO WITHHOLD AUTHORITY FOR ANY INDIVIDUAL NOMINEE STRIKE
SUCH NOMINEE'S NAME FROM THE LIST BELOW.
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY
(except as marked to the contrary) to vote for all nominees
listed below
DONALD K. SMITH, MICHEL DE BEAUMONT, JOHN R. BERTUCCI
(2) Proposal to ratify and approve the selection of KPMG Peat Marwick LLP as
independent auditors of the Corporation for the fiscal year ending June 28,
1997.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(3) In their discretion to transact such other business as may properly come
before the meeting or any adjournment or adjournments thereof.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR AND IN FAVOR OF THE
ITEMS SET FORTH ABOVE UNLESS A CONTRARY SPECIFICATION IS MADE.
PLEASE MARK, DATE, SIGN AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
Please sign exactly as name appears below.
Dated:___________________________ , 1996
________________________________________
Signature
________________________________________
Signature if held jointly
________________________________________
Printed Name
________________________________________
Address
NOTE: 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 the person named on
the stock certificate has died, please
submit evidence of your authority. If a
corporation, please sign in full
corporate name by the President or
authorized officer and indicate the
signer's office. If a partnership,
please sign in partnership name by
authorized person.
