<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
FILED BY THE REGISTRANT [X] FILED BY A PARTY OTHER THAN THE REGISTRANT [ ]
- --------------------------------------------------------------------------------
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Micrion Corporation
(Name of Registrant as Specified In Its Charter)
(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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
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<PAGE> 2
MICRION CORPORATION
ONE CORPORATION WAY
PEABODY, MASSACHUSETTS 01960
November 9, 1998
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders
of Micrion Corporation (the "Company"), which will be held on Thursday, December
10, 1998 at 10:00 A.M., at the offices of Choate, Hall & Stewart, 36th Floor,
Exchange Place, 53 State Street, Boston, Massachusetts.
The following Notice of Annual Meeting of Stockholders and Proxy
Statement describe the items to be considered by the stockholders and contain
certain information about the Company and its officers and directors.
Please sign and return the enclosed proxy card as soon as possible in
the envelope provided so that your shares can be voted at the meeting in
accordance with your instructions. Even if you plan to attend the meeting, we
urge you to sign and return promptly the proxy card. You may revoke it at any
time before it is exercised at the meeting or vote your shares personally if you
attend the meeting.
We look forward to seeing you.
Sincerely,
/s/ Nicholas P. Economou
NICHOLAS P. ECONOMOU
Chairman, President and Chief Executive Officer
<PAGE> 3
MICRION CORPORATION
ONE CORPORATION WAY
PEABODY, MASSACHUSETTS 01960
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER 10, 1998
The Annual Meeting of Stockholders of Micrion Corporation (the
"Company") will be held at the offices of Choate, Hall & Stewart, 36th Floor,
Exchange Place, 53 State Street, Boston, Massachusetts, on Thursday, December
10, 1998 at 10:00 A.M., for the following purposes:
1. To elect the Board of Directors of the Company;
2. To ratify the Board of Directors' selection of KPMG Peat
Marwick LLP as the Company's independent auditors for the fiscal year
ending June 30, 1999; and
3. To transact such other business as may properly come before the
meeting, and any or all adjournments thereof.
Stockholders of record at the close of business on October 28, 1998
will be entitled to notice of and to vote at the meeting and any adjournments
thereof.
By Order of the Board of Directors
/s/ Roslyn G. Daum
ROSLYN G. DAUM
Clerk
Dated: November 9, 1998
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED RETURN ENVELOPE
IN ORDER THAT YOUR SHARES MAY BE REPRESENTED.
<PAGE> 4
MICRION CORPORATION
ONE CORPORATION WAY
PEABODY, MASSACHUSETTS 01960
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished to the holders of common stock of
Micrion Corporation (hereinafter referred to as the "Company") in connection
with the solicitation of proxies to be voted at the Annual Meeting of
Stockholders to be held on December 10, 1998 and at any adjournments of that
meeting. The enclosed proxy is solicited on behalf of the Board of Directors of
the Company. Each properly signed proxy will be voted in accordance with the
instructions contained therein, and, if no choice is specified, the proxy will
be voted in favor of the proposals set forth in the Notice of Annual Meeting.
A person giving the enclosed proxy has the power to revoke it at any
time before it is exercised at the meeting, by written notice to the Clerk of
the Company, by sending a later dated proxy, or by revoking it in person at the
meeting.
The approximate date on which this Proxy Statement and the enclosed
proxy will first be sent to stockholders is November 9, 1998. The Company's
Annual Report to Stockholders for the year ended June 30, 1998 is being mailed
together with this Proxy Statement.
Only holders of common stock of record on the stock transfer books of
the Company at the close of business on October 28, 1998 (the "record date")
will be entitled to vote at the meeting. There were 4,074,397 shares of common
stock outstanding and entitled to vote on the record date.
Each share of common stock is entitled to one vote. The affirmative
vote of the holders of a plurality of the shares represented at the meeting, if
a quorum is present, is required for the election of directors. If a quorum is
present, approval of each other matter which is before the meeting will require
the affirmative vote of the holders of a majority of votes cast with respect to
such matter.
For purposes of the matters before the Annual Meeting, under the
Company's By-Laws, a quorum consists of a majority of the issued and outstanding
shares entitled to vote on such matters as of the record date. Shares as to
which a nominee (such as a broker holding shares in street name for a beneficial
owner) has no voting authority in respect of such matter will be deemed
represented for quorum purposes but will not be deemed to be voting on such
matters, and therefore will not be counted as negative votes as to such matters.
Votes will be tabulated by the Company's transfer agent subject to the
supervision of persons designated by the Board of Directors as inspectors.
<PAGE> 5
STOCK OWNERSHIP OF DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
The following table sets forth certain information regarding beneficial
ownership of the Company's common stock as of October 1, 1998 by (a) each
director and nominee for director of the Company, (b) each of the executive
officers named in the Summary Compensation Table below and (c) all current
directors and executive officers as a group. Except as otherwise indicated, each
person has sole investment and voting power with respect to the shares shown as
being beneficially owned by such person, based on information provided by such
owners. To the Company's knowledge, no person beneficially owned 5% or more of
the Company's Common Stock as of October 1, 1998.
<TABLE>
<CAPTION>
COMMON STOCK PERCENT OF
NAME BENEFICIALLY OWNED OUTSTANDING SHARES
-- ------------------ ------------------
<S> <C> <C>
Nicholas P. Economou............................................... 144,115 (1) 3.5
John A. Doherty.................................................... 70,789 (2) 1.7
Robert K. McMenamin................................................ 49,433 (3) 1.2
Billy W. Ward...................................................... 54,079 (4) 1.3
Charles J. Libby................................................... 42,988 (5) 1.1
David M. Hunter.................................................... 32,527 (6) *
Thomas W. Folger................................................... 15,000 (7) *
Louis P. Valente .................................................. 11,000 (8) *
Charles M. McKenna................................................. 7,500 (9) *
All current directors and executive officers as a group
(10 persons)..................................................... 450,905 (10) 10.5
</TABLE>
- -----------
* Less than 1%.
(1) Includes options to purchase 60,120 shares which are exercisable within
60 days after October 1, 1998.
(2) Includes options to purchase 19,391 shares which are exercisable within
60 days after October 1, 1998.
(3) Includes options to purchase 17,516 shares which are exercisable within
60 days after October 1, 1998.
(4) Includes options to purchase 43,470 shares which are exercisable within
60 days after October 1, 1998, and 3,717 shares held in trust under the
Billy W. Ward Family Trust, as to which shares Mr. Ward shares voting and
investment power and disclaims beneficial ownership.
(5) Includes options to purchase 17,516 shares which are exercisable within
60 days after October 1, 1998.
(6) Includes options to purchase 19,404 shares which are exercisable within
60 days after October 1, 1998.
(7) Includes options to purchase 10,000 shares which are exercisable within
60 days after October 1, 1998.
(8) Includes options to purchase 10,000 shares which are exercisable within
60 days after October 1, 1998.
(9) Consists of options to purchase 7,500 shares which are exercisable within
60 days after October 1, 1998.
(10) Includes options to purchase 225,058 shares which are exercisable within
60 days after October 1, 1998 held by executive officers and directors of
the Company.
2
<PAGE> 6
ELECTION OF DIRECTOR
(ITEM 1 OF NOTICE)
There are currently five members of the Board of Directors. The By-Laws
of the Company provide that the directors are classified, with respect to the
time for which they hold office, into three classes, as nearly equal in number
as possible, with terms expiring at the 1998, 1999 and 2000 Annual Meetings. At
each Annual Meeting, the successors to the class of directors whose term expires
at that meeting shall be elected to hold office for a term continuing until the
Annual Meeting held in the third year following the year of their election. At
this Annual Meeting the Board has fixed the number of directors for the ensuing
year at five and has nominated David M. Hunter for election in the class, the
term of which expires at the Annual Meeting in 2001.
Mr. Hunter has consented to serve, if elected at the meeting, for the
above-described term and until his successor is elected and qualified. The
shares represented by the enclosed proxy will be voted to elect Mr. Hunter
unless such authority is withheld by marking the proxy to that effect. Mr.
Hunter has agreed to serve, but in the event he becomes unavailable for any
reason, the proxy, unless authority has been withheld as to such nominee, may be
voted for the election of a substitute.
The following information is furnished with respect to the nominee for
election as a director and each director whose term will continue following the
Annual Meeting.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE DURING
NAME AND AGE LAST FIVE YEARS;
AS OF NOVEMBER 9, 1998 DIRECTORSHIPS OF PUBLIC COMPANIES
---------------------- ---------------------------------
<S> <C>
NOMINEE FOR ELECTION FOR TERM OF THREE YEARS EXPIRING IN 2001
David M. Hunter, 54................................................... Mr. Hunter has been Vice President, Finance and
Administration, since January 1993. Mr. Hunter joined
the Company in 1984 as Treasurer. Mr. Hunter received
a B.S. in accounting from Boston College in 1966 and
an M.B.A. from Columbia University in 1968.
DIRECTORS WHOSE TERM OF THREE YEARS EXPIRES IN 2000
Thomas W. Folger, 71.................................................. Mr. Folger, a Director of the Company since 1985, has
been a General Partner of the sole General Partner of
DeMuth, Folger & Wetherill, a venture capital firm,
since its formation in 1994, and a General Partner of the
sole General Partner of DeMuth, Folger & Terhune, a
venture capital firm, since its formation in 1983. Prior
to 1983, Mr. Folger was Vice President and a member
of the Board of Directors of Kidder, Peabody & Co.
Incorporated. Mr. Folger is a director of IEC
Electronics Corp., a publicly traded company and a
provider of contract manufacturing services for
electronics companies.
</TABLE>
3
<PAGE> 7
<TABLE>
<S> <C>
Louis P. Valente, 68.................................................. Mr. Valente, a Director of the Company since 1989,
became a director of Palomar Medical Technologies,
Inc., a publicly held company, on February 1, 1997, and
on May 15, 1997, he was elected President and Chief
Executive Officer of Palomar. Palomar designs,
manufactures and sells cosmetic lasers and operates
centers for cosmetic treatments. He was a Senior Vice
President of Acquisitions, Mergers and Investments of
EG&G, Inc., a diversified high technology company,
from 1991 until his retirement in 1995, and was Vice
President of Corporate Development from 1984 through
1991. Mr. Valente, a certified public accountant, is also
a director of several privately held companies.
DIRECTORS WHOSE TERM OF TWO YEARS EXPIRES IN 1999
Nicholas P. Economou, 50.............................................. Dr. Economou has been President and a Director of the
Company since February 1990, Chief Executive Officer
since August 1993 and Chairman of the Board since
November 1997. Dr. Economou joined the Company in
1984 as the Director of Engineering and was
subsequently promoted to Vice President, Engineering,
prior to becoming President. Dr. Economou has been a
director of Palomar Medical Technologies, Inc. since
November 13, 1997. Palomar designs, manufactures and
sells cosmetic lasers and operates centers for cosmetic
treatments.
Charles M. McKenna, 53................................................ Mr. McKenna, a Director of the Company since 1995,
has been Vice President of Varian Semiconductor
Equipment and General Manager of Varian's Ion Implant
Systems, a semiconductor equipment manufacturer, since
1989. He has previously held technical positions with
Varian Corporation, IBM and Hughes Research
Laboratories.
</TABLE>
BOARD OF DIRECTORS AND COMMITTEE MEETINGS
The Board of Directors has Audit and Compensation Committees. It does
not have a nominating or similar committee.
The Audit Committee, which periodically meets with management and the
Company's independent accountants, reviews the results and scope of the audit
and other services provided by the Company's independent accountants, the need
for internal auditing procedures and the adequacy of internal controls. The
directors currently serving on the Audit Committee are Messrs. Valente, Folger
and McKenna. The Audit Committee met once during fiscal 1998.
The Compensation Committee establishes salaries for officers and
incentives and other forms of compensation for officers and other key employees;
administers the various incentive compensation and benefit plans; and recommends
policies relating to such plans. The directors currently serving on the
Compensation Committee are Messrs. Folger and McKenna. The Compensation
Committee met twice during fiscal 1998.
4
<PAGE> 8
During fiscal 1998, the Board of Directors of the Company held eight
meetings. Each incumbent director attended at least 75% of the aggregate number
of the meetings of the Board and the meetings of the committees of the Board on
which he served.
DIRECTOR COMPENSATION
The Company's directors receive compensation in the amount of $1,500
for each regularly scheduled, quarterly meeting of the Board of Directors
attended and an annual retainer of $4,000 and may be reimbursed for certain
expenses in connection with attendance at Board and committee meetings. Under
the Company's 1994 Non-Employee Director Stock Option Plan, each non-employee
director serving as such on the date of the annual meeting of the Board of
Directors held closest to the fourth, eighth and any subsequent four-year
anniversary of the date of such director's election to the Board of Directors is
entitled to receive on such date an option to purchase 10,000 shares of Common
Stock (subject to vesting over sixteen quarterly periods), exercisable at a
price per share equal to fair market value on the date of grant. Any
non-employee director, upon his or her first election to the Board of Directors,
is entitled to receive an option to purchase 10,000 shares of Common Stock.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
This report, prepared by the Compensation Committee of the Company's
Board of Directors (the "Committee"), addresses the Company's executive
compensation policies and the basis on which fiscal 1998 executive officer
compensation determinations were made. The Committee designs and approves all
components of executive pay.
To ensure that executive compensation is designed and administered in
an objective manner, the Committee's members are all non-employee directors.
During fiscal 1998, the Committee members were Thomas W. Folger, Charles M.
McKenna and, until his resignation from the Committee on November 13, 1997,
Louis P. Valente.
Compensation Philosophy
The Company's executive compensation policies are intended to attract,
retain, motivate and reward executives who can lead the Company in achieving its
long-term growth and earnings goals. The objective of the Committee is to
implement a compensation program that will provide appropriate incentives while,
at the same time, encouraging executive officers to increase their equity
ownership in the Company and thereby align their interests with those of the
Company's stockholders. The compensation program consists primarily of three
components, namely (a) base salary, (b) bonus and (c) stock options. Each of
these factors are further described below. In addition, executive officers are
eligible to participate, on a non-discriminatory basis, in various benefit
programs provided to all full-time employees, including the Company's stock
purchase plan, 401(k) plan and group medical, disability and life insurance
programs. The Committee believes that executive compensation packages should be
viewed as a whole in order to assess properly their appropriateness.
In establishing total compensation packages for the Company's executive
officers, the Committee takes into account the compensation packages offered to
executives of other semiconductor capital equipment companies of similar
stature. The Committee uses this comparative data primarily as benchmarks to
ensure that the Company's executive compensation packages are competitive. The
Committee seeks to maintain total compensation within the broad middle range of
comparative pay. The Committee generally meets quarterly and at other times that
it deems are necessary and, from time to time, confers with outside advisors
concerning acceptable industry practices. Individual amounts are based not only
on comparative data, but also on such factors as length of service with the
Company and the Committee's judgment as to individual contributions. These
factors are not assigned specific mathematical weights.
5
<PAGE> 9
Salary
Base salaries are reviewed annually. It is the Committee's intention to
pay slightly below-market base salary but provide a significant equity ownership
opportunity to create incentives for the Company's executive officers to
maximize the Company's growth and success while increasing stockholders' value
over the long term. Changes in base salary from year to year depend upon such
factors as individual performance, cost of living changes and the economic and
business conditions affecting the Company. Executive officer base salaries are
set at the beginning of each calendar year. Given the Company's financial
performance and the current difficult economic and business climate, the
Committee decided to keep executive officer's base salaries unchanged in fiscal
1998.
Bonus
Executive bonuses are determined in accordance with achievement of the
Company's goals for the most recent fiscal year. The amounts are intended to
reward management for achieving certain milestones set out at the beginning of
the fiscal year. Among others, operating profit, sales growth, bookings and
asset management are taken into account.
Stock Options
As noted above, stock options are an important component of total
executive compensation. Stock options are considered long-term incentives that
link the long-term interests of management with those of the Company's
stockholders. Stock options that the Committee has granted vest over a four year
period from the date of grant at the rate of 6.25% per fiscal quarter,
commencing at the end of the quarter in which they were granted. Option exercise
prices are set at 100% of the fair market value of the stock at the date of the
grant and expire after ten years. The Committee has absolute discretion to
determine the recipients and the number of options to be awarded. Each award is
at the Committee's discretion and is not subject to any specific formula or
criteria. The Committee generally awards options on an annual basis. The number
of shares for which options were granted to executive officers in fiscal 1998
was determined by the Committee based upon several factors, including the
executive's position, his past and future expected performance, the comparative
data described above, and the number of shares under options previously granted.
These factors were evaluated in a qualitative manner and were not assigned
predetermined weights.
Stock Option Repricing
During fiscal 1998, certain stock options granted to executive officers
and others on August 8, 1997 at an exercise price of $18.75 per share were
canceled and reissued on March 23, 1998 at a new exercise price of $10.88. The
vesting terms of the reissued options were reset to begin vesting in sixteen
quarterly installments from March 23, 1998. The Committee took this action in
relation to the decision not to increase base salaries for executive officers in
fiscal 1998. The Committee considers equity ownership interests to be an
important component of the compensation of executive officers as a way to reward
performance and to provide appropriate incentives for long term growth and
profitability.
The following table is provided regarding repricing of options in
fiscal 1998 for the Company's executive officers:
<TABLE>
<CAPTION>
TEN YEAR OPTION REPRICING
-------------------------
NUMBER OF LENGTH OF ORIGINAL
--------- ------------------
SECURITIES MARKET PRICE OF OPTION TERM
---------- --------------- -----------
UNDERLYING OPTIONS STOCK AT TIME OF REMAINING AT DATE
------------------ ---------------- -----------------
NAME DATE OF REPRICING REPRICED REPRICING NEW EXERCISE PRICE OF REPRICING
---- ----------------- -------- --------- ------------------ ------------
<S> <C> <C> <C> <C> <C>
Nicholas P. Economou 03/23/98 30,000 $10.88 $10.88 9.3 years
John A. Doherty 03/23/98 10,000 $10.88 $10.88 9.3 years
Robert K. McMenamin 03/23/98 10,000 $10.88 $10.88 9.3 years
Billy W. Ward 03/23/98 5,000 $10.88 $10.88 9.3 years
Charles J. Libby 03/23/98 10,000 $10.88 $10.88 9.3 years
David M. Hunter 03/23/98 10,000 $10.88 $10.88 9.3 years
Frank Frontiero 03/23/98 10,000 $10.88 $10.88 9.3 years
</TABLE>
6
<PAGE> 10
Section 162(m)
Section 162(m) of the Internal Revenue Code which became effective
January 1, 1994, generally limits the deductibility of annual compensation for
certain officers to $1 million. It is the general intention of the Committee to
assure that officer compensation will meet the Section 162(m) requirements for
deductibility. However, the Committee reserves the right to use its judgment to
authorize compensation payments which may be in excess of the limit when the
Committee believes such payment is appropriate, after taking into consideration
changing business conditions or the officer's performance, and is in the best
interest of the shareholders. The Committee will review its policy concerning
Section 162(m) on a year-by-year basis.
Compensation Committee
Thomas W. Folger
Charles M. McKenna
7
<PAGE> 11
COMPARISON OF CUMULATIVE TOTAL STOCKHOLDER RETURN
The following performance graph assumes an investment of $100 on May
11, 1994 (the date the Company's common stock was first registered under Section
12 of the Securities Exchange Act of 1934, as amended (the "1934 Act")) and
compares the changes thereafter in the market price of the Company's common
stock with a broad market index (Nasdaq Stock Market (U.S.)) and an industry
index (H&Q Technology). The Company paid no dividends during the periods shown;
the performance of the indexes is shown on a total return (dividend
reinvestment) basis. The graph lines merely connect fiscal year-end dates and do
not reflect fluctuations between those dates.
[GRAPH]
- --------------------------------------------------------------------------------
5/11/94 6/30/94 6/30/95 6/3096 6/30/97 6/30/98
- --------------------------------------------------------------------------------
Micrion Corporation $100 $114 $245 $264 $309 $184
Nasdaq Stock Market-US 100 99 132 169 206 272
H & Q Technology 100 97 172 201 263 333
- --------------------------------------------------------------------------------
THE COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION AND THE
COMPARISON OF CUMULATIVE TOTAL STOCKHOLDER RETURN INFORMATION ABOVE SHALL NOT BE
DEEMED "SOLICITING MATERIAL" OR INCORPORATED BY REFERENCE INTO ANY OF THE
COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION BY IMPLICATION OR
BY ANY REFERENCE IN ANY SUCH FILING TO THIS PROXY STATEMENT.
8
<PAGE> 12
EXECUTIVE OFFICER COMPENSATION
The following summary compensation table sets forth the compensation
paid or accrued for services rendered in fiscal 1998, 1997 and 1996 to the Chief
Executive Officer and the other four most highly compensated executive officers
of the Company (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
------------
COMPENSATION
------------
ANNUAL COMPENSATION AWARDS
----------------------------------------- ------------
OTHER ANNUAL SECURITIES ALL OTHER
NAME AND FISCAL BONUS(S) COMPENSATION UNDERLYING COMPENSATION
PRINCIPAL POSITION YEAR SALARY ($) ($) ($)(1) OPTIONS (#) ($)
------------------ ------ ---------- -------- ------------ ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Nicholas P. Economou - 1998 $200,761 -- $10,800 30,000 $ 5,764(2)
Chairman, President and 1997 183,268 $25,000 10,800 20,000 6,590
Chief Executive Officer 1996 159,716 50,000 10,800 35,000 3,432
John A. Doherty - 1998 176,379(3) -- 10,800 10,000 3,983(4)
Senior Vice President, 1997 155,785(5) -- 10,800 6,667 3,865
Marketing 1996 146,076(6) 10,000 11,145 7,500 16,086
Robert K. McMenamin - 1998 159,238(7) -- 10,800 10,000 3,636(8)
Vice President, Sales 1997 188,394(9) -- 10,800 6,666 3,515
1996 144,239(10) 7,000 10,800 5,000 1,948
Billy W. Ward - 1998 150,587 -- -- 5,000 5,453(11)
Senior Vice President, 1997 150,587 10,000 -- -- 5,540
Chief Engineer 1996 126,547 18,000 -- 50,000 19,790
Charles J. Libby - 1998 125,468 -- -- 10,000 4,544(12)
Vice President, 1997 118,001 10,000 -- 6,667 4,320
Engineering 1996 107,432 20,000 -- 5,000 2,259
</TABLE>
- ---------
(1) Includes annual personal car allowance in the amount of $10,800.
(2) Consists of (i) insurance premiums with respect to term life insurance in
the amount of $1,092 and (ii) Company contributions to 401(k) account in
the amount of $4,672.
(3) Includes sales commissions in the amount of $65,966.
(4) Consists of (i) insurance premiums with respect to term life insurance in
the amount of $686, (ii) Company contributions to 401(k) account in the
amount of $3,297.
(5) Includes sales commission in the amount of $49,802.
(6) Includes sales commissions in the amount of $45,943.
(7) Includes sales commissions in the amount of $58,847.
(8) Consists of (i) insurance premiums with respect to term life insurance in
the amount of $624 and (ii) Company contributions to 401(k) account in
the amount of $3,012.
(9) Includes sales commissions in the amount of $92,038.
(10) Includes sales commissions in the amount of $53,166.
(11) Consists of (i) insurance premiums with respect to term life insurance in
the amount of $936 and (ii) Company contributions of 401(k) account in
the amount of $4,517.
(12) Consists of (i) insurance premiums with respect to term life insurance in
the amount of $780 and (ii) Company contributions to 401(k) account in
the amount of $3,764.
9
<PAGE> 13
OPTIONS GRANTS IN LAST FISCAL YEAR
The following table shows all stock option grants to the Named
Executive Officers during fiscal 1998.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
NUMBER OF SHARES PERCENT OF TOTAL OPTIONS ASSUMED ANNUAL RATE OF
UNDERLYING OPTIONS GRANTED TO EMPLOYEES EXERCISE PRICE EXPIRATION STOCK PRICE APPRECIATION FOR
NAME GRANTED (#)(1) IN FISCAL YEAR PER SHARE DATE OPTION TERM (2)
---- -------------- -------------- --------- ---------- ---------------
5% 10%
-------- --------
<S> <C> <C> <C> <C> <C> <C>
Nicholas P. Economou..... 30,000(3) 13.6% $10.88 3/23/08 $205,271 $520,198
John A. Doherty.......... 10,000(3) 4.6% 10.88 3/23/08 68,424 173,399
Robert K. McMenamin...... 10,000(3) 4.6% 10.88 3/23/08 68,424 173,399
Billy W. Ward............ 5,000(3) 2.3% 10.88 3/23/08 34,212 86,700
Charles J. Libby......... 10,000(3) 4.6% 10.88 3/23/08 68,424 173,399
</TABLE>
- ----------------------
(1) The options listed below were issued following the cancellation of
options granted on August 8, 1997 at an exercise price of $18.75 per
share. See "Compensation Committee Report--Stock Option Repricing."
(2) As required by the rules of the Securities and Exchange Commission,
potential values stated are based on the prescribed assumption that the
Company's common stock will appreciate in value from the date of grant
to the end of the option term at rates (compounded annually) of 5% and
10%, respectively, and therefore are not intended to forecast possible
future appreciation, if any, in the price of the Company's common
stock.
(3) These options vest in sixteen (16) equal quarterly installments,
commencing on March 23, 1998, the date of grant, subject to continuing
employment.
FISCAL YEAR-END OPTION VALUES
During fiscal 1998, none of the Named Executive Officers exercised stock
options issued by the Company. The following table sets forth information
regarding the number of vested and unvested options and the unrealized value or
spread (the difference between the exercise price and the market value) of the
unexercised options issued by the Company and held by the Named Executive
Officers on July 1, 1998.
<TABLE>
<CAPTION>
NUMBER OF SHARES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS(#) IN-THE-MONEY OPTIONS($)
---------------------- -----------------------
NAME VESTED UNVESTED VESTED UNVESTED
- ---- ------ -------- ------ --------
<S> <C> <C> <C> <C>
Nicholas P. Economou............. 51,995 48,125 $2,500 $2,500
John A. Doherty.................. 16,787 14,896 833 833
Robert K. McMenamin.............. 15,068 14,114 833 834
Billy W. Ward.................... 38,938 23,594 -- --
Charles J. Libby................. 15,068 14,115 833 833
</TABLE>
10
<PAGE> 14
RATIFICATION OF SELECTION OF
INDEPENDENT AUDITORS
(ITEM 2 OF NOTICE)
On the recommendation of the Audit Committee, the Board of Directors has
selected KPMG Peat Marwick LLP, independent certified public accountants, as
auditors of the Company for the fiscal year ending June 30, 1999. This firm has
audited the accounts and records of the Company since 1985. A representative of
KPMG Peat Marwick LLP will be present at the Annual Meeting to answer questions
from stockholders and will have an opportunity to make a statement if desired.
The selection of independent auditors is not required to be submitted to a
vote of the stockholders. The Board believes, however, it is appropriate as a
matter of policy to request that the stockholders ratify the appointment. If the
stockholders do not ratify the appointment, the Board will reconsider its
selection.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the 1934 Act, requires the Company's officers and
directors and persons who own more than ten percent of its common stock to file
reports with the Securities and Exchange Commission disclosing their ownership
of stock in the Company and changes in such ownership. Copies of such reports
are also required to be furnished to the Company. Based solely on a review of
the copies of such reports received by it, the Company believed that, during
fiscal 1998, all such filing requirements were complied with.
STOCKHOLDER PROPOSALS FOR 1999 MEETING
Proposals of stockholders intended to be presented at the 1999 Annual
Meeting of Stockholders must be presented on or before July 13, 1999 for
inclusion in the proxy materials relating to that meeting and on or before
September 26, 1999 for matters to be considered timely such that, pursuant to
Rule 14a-8 under the 1934 Act, the Company may not exercise its discretionary
authority to vote on such matters at that meeting. Any such proposals should be
sent to the Company at its principal offices addressed to the Vice President,
Finance and Administration. Other requirements for inclusion are set forth in
Rule 14a-8 under the 1934 Act.
OTHER MATTERS
The Company has no knowledge of any matters to be presented for action by
the stockholders at the Annual Meeting other than as set forth above. However,
the enclosed proxy gives discretionary authority to the persons named therein to
act in accordance with their best judgment in the event that any additional
matters should be presented.
The Company will bear the cost of the solicitation of proxies by
management, including the charges and expenses of brokerage firms and others for
forwarding solicitation material to beneficial owners of common stock.
By order of the Board of Directors
/s/ Roslyn G. Daum
------------------------------
Roslyn G. Daum
Clerk
November 9, 1998
The Board hopes that stockholders will attend the meeting. WHETHER
OR NOT YOU PLAN TO ATTEND, YOU ARE URGED TO COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE. A prompt response will greatly
facilitate arrangements for the meeting, and your cooperation will be
appreciated. Stockholders who attend the meeting may vote their stock personally
even though they have sent in their proxies.
11
<PAGE> 15
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
MICRION CORPORATION
1998 ANNUAL MEETING OF STOCKHOLDERS
The undersigned stockholder of MICRION CORPORATION, a Massachusetts corporation,
hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders and
Proxy Statement, each dated November 9, 1998, and hereby appoints Nicholas F.
Economou and David M. Hunter, and both of them, proxies and attorneys-in-fact,
with full power to each of substitution, on behalf and in the name of the
undersigned, to represent the undersigned at the 1998 Annual Meeting of
Stockholders of MICRION CORPORATION to be held on Thursday, December 10, 1998 at
10:00 a.m., local time, at the offices of Choate, Hall & Stewart, Exchange
Place, 53 State Street, Boston, Massachusetts, and at any adjournment(s)
thereof, and to vote all shares of Common Stock which the undersigned would be
entitled to vote if then and there personally present, on the matters set forth
on the reverse side. Either of such attorneys or substitutes shall have and may
exercise all of the powers of said attorneys-in-fact hereunder.
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION IS INDICATED, WILL BE
VOTED FOR THE ELECTION OF DIRECTOR, FOR THE RATIFICATION OF THE APPOINTMENT OF
KPMG PEAT MARWICK LLP AS INDEPENDENT AUDITORS, AND AS SAID PROXIES DEEM
ADVISABLE ON SUCH MATTERS AS MAY COME BEFORE THE MEETING.
- --------------- ---------------
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
- --------------- ---------------
<PAGE> 16
/X/ PLEASE MARK
VOTES AS IN
THIS EXAMPLE.
1. ELECTION OF DIRECTOR (to serve for the term set forth in the
Proxy Statement):
NOMINEE: David M. Hunter
FOR WITHHELD
/ / / /
FOR AGAINST ABSTAIN
2. PROPOSAL TO RATIFY THE / / / / / /
APPOINTMENT OF KPMG PEAT
MARWICK LLP AS THE
INDEPENDENT AUDITORS OF
THE COMPANY FOR THE 1999
FISCAL YEAR:
3. and upon such other matter or matters which may properly
come before the meeting and any adjournment(s) thereof.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT / /
(This Proxy should be dated, signed by the stockholder(s) exactly
as his or her name appears hereon, and returned promptly in the enclosed
envelope. Persons signing in a fiduciary capacity should so indicate.
If shares are held by joint tenants or as community property,
both should sign.)
