<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 204.14a-12
PRI AUTOMATION, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act
Rule 0-11: (Set forth the amount on which the filing fee is calculated and
state how it was determined.)
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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4) Date Filed:
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<PAGE>
PRI AUTOMATION, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 7, 1997
Notice is hereby given that the Annual Meeting of Stockholders of PRI
Automation, Inc. (the "Company") will be held at the offices of the Foley,
Hoag & Eliot LLP, One Post Office Square, Boston, Massachusetts on Friday,
February 7, 1997, beginning at 10:00 A.M., local time, for the following
purposes:
1. To fix the number of directors that shall constitute the whole Board of
Directors of the Company at five and to consider and vote upon the
election of five directors.
2. To act upon a proposal to amend the Company's 1994 Incentive and
Nonqualified Stock Option Plan to increase the number of shares of
Common Stock available for grant thereunder by 300,000.
3. To transact such further business as may properly come before the Annual
Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on December 13, 1996,
as the record date for the determination of the stockholders of the Company
entitled to notice of, and to vote at, said Annual Meeting and any adjournment
thereof. Only stockholders of record on such date are entitled to notice of,
and to vote at, said Annual Meeting or any adjournment thereof.
By Order of the Board of Directors,
Mordechai Wiesler
Clerk
Billerica, Massachusetts
January 6, 1997
YOUR VOTE IS IMPORTANT
PLEASE SIGN AND RETURN THE ENCLOSED PROXY, WHETHER OR NOT YOU PLAN TO ATTEND
THE MEETING.
<PAGE>
PRI AUTOMATION, INC.
805 MIDDLESEX TURNPIKE
BILLERICA, MASSACHUSETTS 01821
(508) 670-4270
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
February 7, 1997
This Proxy Statement and the enclosed form of proxy are being mailed to
stockholders on or about January 6, 1997 in connection with the solicitation
by the Board of Directors of PRI Automation, Inc. (the "Company") of proxies
to be used at the Annual Meeting of Stockholders of the Company, to be held on
Friday, February 7, 1997, and at any and all adjournments thereof (the "Annual
Meeting"). When proxies are returned properly executed, the shares represented
will be voted in accordance with the stockholders' directions. Stockholders
are encouraged to vote on the matters to be considered. However, if no choice
has been specified by a stockholder, the shares covered by any executed proxy
will be voted as recommended by management. Any stockholder may revoke his
proxy at any time before it has been exercised by providing the Company with a
later dated proxy, by notifying the Company's Clerk in writing or by attending
the Annual Meeting and voting in person.
The Board of Directors of the Company (the "Board") has fixed the close of
business on December 13, 1996, as the record date for the determination of the
stockholders of the Company entitled to notice of, and to vote at, the Annual
Meeting and any adjournment thereof. Only stockholders of record on such date
are entitled to notice of, and to vote at, the Annual Meeting or any
adjournment thereof. At the close of business on the record date, there were
issued and outstanding 7,345,853 shares of the Company's Common Stock, $.01
par value (the "Common Stock"), each of which is entitled to cast one vote.
QUORUM AND TABULATION OF VOTES
The By-Laws of the Company provide that the holders of a majority in
interest of shares of Common Stock issued and outstanding and entitled to vote
thereat will constitute a quorum at the Annual Meeting. Shares of Common Stock
represented by a properly signed and returned proxy will be treated as present
at the Annual Meeting for purposes of determining a quorum. In general, votes
withheld from any nominee for election as director, abstentions and broker
"non-votes" are counted as present or represented for purposes of determining
the presence or absence of a quorum for the Annual Meeting. A "non-vote"
occurs when a broker or nominee holding shares for a beneficial owner votes on
one proposal, but does not vote on another proposal because, in respect of
such other proposal, the broker or nominee does not have discretionary voting
power and has not received instructions from the beneficial owner.
A plurality of the votes properly cast at the Annual Meeting will elect each
director. Abstentions, votes withheld from director-nominees, and broker "non-
votes" will not be included in calculating the number of votes cast on
Proposal One.
The affirmative vote of a majority of the votes properly cast at the Annual
Meeting will be necessary to approve Proposal Two, the proposal to amend the
Company's 1994 Incentive and Nonqualified Stock Option
<PAGE>
Plan. Abstentions with respect to Proposal Two will count as being present and
represented at the Annual Meeting and entitled to vote, and will be included
in calculating the number of votes cast on Proposal Two. Broker "non-votes"
will not be included in calculating the number of votes cast on Proposal Two.
Votes will be tabulated by the Company's transfer agent, State Street Bank
and Trust Company. The vote on each matter submitted to stockholders will be
tabulated separately.
PROPOSAL ONE--
ELECTION OF DIRECTORS
The Company's By-Laws provide for a Board of Directors, the number of which
shall be fixed from time to time by the stockholders of the Company, and may
be enlarged or reduced by vote of a majority of the Board of Directors. The
Board of Directors has recommended that the number of directors be fixed at
five and has nominated for election as directors Mordechai Wiesler, Mitchell
G. Tyson, Amram Rasiel, Boruch B. Frusztajer and Alexander V. d'Arbeloff, each
of whom is currently a director of the Company. Each director elected at the
Annual Meeting will hold office until the next annual election of directors
and until his successor is chosen and qualified or until he sooner dies,
resigns, is removed, or becomes disqualified.
Each of the nominees has agreed to serve if elected, and the Company has no
reason to believe that any nominee will be unable to serve. In the event that
one or more nominees is unable or declines to serve as a director at the time
of the Annual Meeting, proxies will be voted for such other nominee as is then
designated by the Board.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THIS PROPOSAL TO FIX THE NUMBER OF
DIRECTORS AT FIVE AND TO ELECT THE FIVE INDIVIDUALS NAMED ABOVE AS DIRECTORS
OF THE COMPANY.
PROPOSAL TWO--
AMENDMENT TO THE 1994 INCENTIVE AND NONQUALIFIED STOCK OPTION
PLAN TO INCREASE THE NUMBER OF SHARES OF COMMON STOCK THAT MAY
BE ISSUED UPON EXERCISE OF OPTIONS GRANTED THEREUNDER
The 1994 Incentive and Nonqualified Stock Option Plan (the "1994 Stock
Option Plan") as amended by the Board in November 1995 and approved by the
Company's stockholders in January 1996 provides that the total number of
shares of Common Stock that may be issued pursuant to options granted under
the 1994 Stock Option Plan shall not exceed 905,000 (subject to adjustment
upon certain changes in capitalization of the Company). In November 1996, the
Board amended the 1994 Stock Option Plan to increase the number of shares of
Common Stock that may be issued pursuant to options granted thereunder from
905,000 to 1,205,000, subject to approval by the stockholders of the Company.
See "1994 Stock Option Plan" for a description of the material features of the
1994 Stock Option Plan, the classes of persons eligible to participate
therein, the approximate number of persons in each such class and the basis of
such participation.
The Company intends to file, as soon as practicable, a Registration
Statement on Form S-8 under the Securities Act of 1933 covering the additional
shares of Common Stock issuable under the 1994 Stock Option Plan, as amended.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THIS PROPOSAL TO APPROVE THE
AMENDMENT OF THE 1994 STOCK OPTION PLAN.
2
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning each director
(each of whom has been nominated for reelection) and each executive officer of
the Company:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Mordechai Wiesler......... 66 Chairman of the Board, Chief Executive Officer,
Treasurer and Director
Mitchell G. Tyson......... 42 President, Chief Operating Officer and Director
John J. Schickling........ 56 Chief Financial Officer
Robert G. Postle.......... 42 Vice President, Marketing and Sales
Stephen H. Avedikian,
Jr. ..................... 39 Vice President, Operations
James J. Costa............ 52 Vice President, Tool Automation Systems
Douglas A. Lawson......... 36 Vice President, Software Division
Mitchell Weiss............ 40 Vice President, Strategy/Technology
Diane M. DeLucia.......... 42 Vice President, Human Resources
Walter J. Romanosky,
Jr. ..................... 43 Vice President, Customer Services
Brian J. Doherty.......... 54 Vice President, Engineering
Amram Rasiel(1)........... 66 Director
Boruch B.
Frusztajer(1)(2)......... 66 Director
Alexander V.
d'Arbeloff(2)............ 69 Director
</TABLE>
- --------
(1) Member of the Audit Committee
(2) Member of the Compensation Committee
MORDECHAI WIESLER, a founder of the Company, has been Chief Executive
Officer, Treasurer and a director of the Company since its inception and
served as its President from its inception until February 1995. Mr. Wiesler
was also the founder, president and chairman of Transistor Automation
Corporation until its sale to Teledyne, Inc. in 1966. Mr. Wiesler is currently
a director of SEMI-SEMATECH, Inc., a trade association of American
manufacturers of semiconductor manufacturing equipment.
MITCHELL G. TYSON was elected to the office of President in February 1995
and was named a director of the Company in April 1995. Mr. Tyson has been
Chief Operating Officer of the Company since 1990. From 1987 to 1990, he
served as Vice President, Operations of the Company. From 1984 to 1987, Mr.
Tyson was the director of product management of GCA Corporation, a
manufacturer of semiconductor capital equipment.
JOHN J. SCHICKLING is Chief Financial Officer of the Company. He joined the
Company in 1994. Mr. Schickling was Executive Vice President and Chief
Financial Officer of Proconics, Inc., a manufacturer of semiconductor
manufacturing automation equipment, from 1991 to 1993. From 1986 to 1990 and
from 1993 to January 1994, Mr. Schickling was an independent financial
consultant. From 1981 to 1986, he was Executive Vice President and Chief
Financial Officer of Telesis Systems Corporation, a manufacturer of computer
software and hardware for the CAD industry.
ROBERT G. POSTLE joined the Company in 1994 as Vice President, Marketing and
Sales. From 1989 to 1994, Mr. Postle was Vice President of Marketing and Sales
at ULVAC Technologies, Inc., a manufacturer of vacuum technology products.
From 1987 to 1989, Mr. Postle was Vice President of Marketing and Sales at ASM
Ion Implant, Inc., a manufacturer of ion implantation equipment.
3
<PAGE>
STEPHEN H. AVEDIKIAN, JR. joined the Company in 1994 as Vice President,
Manufacturing. He was appointed Vice President, Manufacturing and Customer
Support in September 1994, and was appointed Vice President, Operations in
February 1995. Before joining the Company, Mr. Avedikian was Director of
Manufacturing and Engineering at Bausch and Lomb/Polymer from 1986 to 1994.
JAMES J. COSTA joined the Company in 1983. He was promoted to Vice
President, Tool Automation Systems in July 1996. He had been Vice President,
Automation Systems since 1994. From 1993 to 1994, he served as Vice President,
Marketing and Advanced Technology Development. From 1988 to 1993, he served as
Vice President, Engineering of the Company.
DOUGLAS A. LAWSON was promoted to Vice President, Software Division in July
1996. He joined the Company as Vice President, Engineering in 1993. From 1987
to 1993, he held several positions in the engineering and marketing
departments at Digital Equipment Corporation. From 1982 to 1987, Mr. Lawson
was a process engineering manager at Intel Corporation.
MITCHELL WEISS joined the Company in 1993 as Vice President, Transport
Technology, and in 1994 was appointed Vice President, Strategy/Technology of
the Company. From 1985 to 1993, Mr. Weiss was President of ProgramMation,
Inc., a supplier of factory automation systems, substantially all the assets
of which were acquired by the Company in 1993.
DIANE M. DELUCIA joined the Company in 1988 as Manager of Human Resources
and was promoted to Director of Human Resources in 1993. In May 1995, Ms.
DeLucia was promoted to Vice President of Human Resources. From 1982 to 1988,
Ms. DeLucia was Director of Personnel at Foxboro/Octek, Inc., a developer and
manufacturer of vision systems for the food and pharmaceutical industry.
WALTER J. ROMANOSKY, JR. joined the Company in 1993 as Director of Project
Management and was promoted to Vice President, Customer Services in December
1995. From 1991 to 1993, Mr. Romanosky was a senior project leader for Mobil
Solar Energy Corporation, a supplier of photovoltaic energy equipment for the
commercial power industry. From 1980 to 1991, he held several positions in the
engineering department at UNC Naval Products, a manufacturer of nuclear
reactor cores for the military.
BRIAN J. DOHERTY joined the Company as Vice President, Engineering in July
1996. From January 1985 to July 1996, Mr. Doherty was Director of Engineering
for the Semiconductor Equipment Division of Eaton Corporation, which
manufactures semiconductor ion implantation equipment.
AMRAM RASIEL has been a director of the Company since 1982. Dr. Rasiel is a
private investor and, from December 1989 to May 1990, was Co-Chief Executive
Officer of ENSR Corporation, an environmental engineering firm. Dr. Rasiel is
currently a director of Opal, Inc., a manufacturer of semiconductor capital
equipment, Progress Software Corporation, a provider of application
development software, and a number of privately-held companies.
BORUCH B. FRUSZTAJER became a director of the Company in 1982. Mr.
Frusztajer has since 1984 been the President of BBF Corporation, an industrial
management company. He is a director of CSP, Inc., a manufacturer of embedded
signal processors, and a number of privately-held companies.
ALEXANDER V. D'ARBELOFF became a director of the Company in 1982. Mr.
d'Arbeloff has been President and CEO of Teradyne, Inc., a manufacturer of
automatic test equipment used in the manufacture of semiconductors, since
1971. Since 1977, Mr. d'Arbeloff has served as Chairman of the Board of
Teradyne. He is currently a director of Stratus Computer, Inc., BTU
Engineering International, Inc. and a number of privately-held companies.
4
<PAGE>
COMMITTEES AND MEETINGS OF THE BOARD
During the fiscal year ended September 30, 1996 ("fiscal 1996"), the Board
met four times and acted one time by unanimous written consent. No director
attended fewer than 75% of the total number of meetings held by the Board and
Committees of the Board on which he served.
The Board currently has two committees. The Audit Committee (currently
composed of Messrs. Rasiel and Frusztajer) reviews the internal accounting
procedures of the Company and consults with and reviews the services provided
by the Company's independent auditors. The Audit Committee met one time during
fiscal 1996. The Compensation Committee (currently composed of Messrs.
Frusztajer and d'Arbeloff) has general responsibility for the Company's
executive compensation policies and practices, including making specific
recommendations to the Board concerning compensation for the Company's
executive officers, and administering the Company's 1984 Incentive Stock
Option Plan (the "1984 Stock Option Plan"), 1994 Incentive and Nonqualified
Stock Option Plan (the "1994 Stock Option Plan") and 1994 Employee Stock
Purchase Plan (the "Stock Purchase Plan"). The Compensation Committee met two
times during fiscal 1996.
REMUNERATION OF EXECUTIVE OFFICERS AND DIRECTORS
DIRECTORS' COMPENSATION
Each non-employee director of the Company has served without cash
compensation but has been reimbursed, upon request, for expenses incurred in
attending meetings of the Board of Directors. Directors who are employees of
the Company are not paid any separate fees for serving as directors. Prior to
fiscal 1996, the Company granted non-qualified stock options to purchase an
aggregate of 54,000 shares of Common Stock, at a weighted average exercise
price of $6.42 per share, in equal amounts of 18,000 each to Amram Rasiel,
Boruch B. Frusztajer and Alexander V. d'Arbeloff, each of whom is a director
of the Company, and granted non-qualified stock options to purchase an
aggregate of 12,000 shares of Common Stock, at a weighted average exercise
price of $2.13 per share, to a former director of the Company. Under the
Company's 1994 Stock Option Plan, on November 30 of each year, each non-
employee director then in office will automatically be granted a non-qualified
option to purchase 1,500 shares of Common Stock at an exercise price equal to
its fair market value on that date. Pursuant to this provision of the 1994
Stock Option Plan, on November 30, 1996, each of Messrs. Rasiel, Frusztajer
and d'Arbeloff was automatically granted a nonqualified option to purchase
1,500 shares of Common Stock at an exercise price of $47.75 per share.
5
<PAGE>
EXECUTIVE COMPENSATION
The following table provides certain summary information concerning the
compensation earned by the Company's Chief Executive Officer and each of the
four other most highly compensated executive officers of the Company
(collectively, the "Named Executive Officers") for services rendered in all
capacities to the Company during fiscal 1996 and during the fiscal years ended
September 30, 1994 and 1995 ("fiscal 1994" and "fiscal 1995," respectively).
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------
AWARDS
------------
ANNUAL COMPENSATION(1) SECURITIES
NAME AND FISCAL ---------------------- UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS(#) COMPENSATION($)(2)
------------------ ------ ----------- ----------------------- ------------------
<S> <C> <C> <C> <C> <C>
Mordechai Wiesler....... 1996 $ 211,153 $ 90,000 11,700 $11,500
Chairman of the Board,
Chief Executive 1995 $ 184,939 $ 90,000 15,000 $ 5,675
Officer, Treasurer and
Director 1994 $ 169,359 $ 84,000 37,500 $ 2,685
Mitchell G. Tyson....... 1996 $ 191,922 $ 90,000 15,300 $ 5,483
President, Chief
Operating Officer and
Director 1995 $ 165,823 $ 100,000 20,000 $ 1,942
1994 $ 146,004 $ 73,400 82,500 $ 1,664
John J. Schickling(3)... 1996 $ 149,616 $ 45,000 9,000 $ 6,047
Chief Financial Officer 1995 $ 132,308 $ 45,000 12,000 $ 2,456
1994 $ 81,089 $ 29,000 33,000 $ 686
Robert G. Postle(3)..... 1996 $ 140,962 $ 54,000 10,800 $ 4,103
Vice President,
Marketing and Sales 1995 $ 130,000 $ 68,000 -- $ 602
1994 $ 5,000 $ 2,000 16,875 $ 41
Stephen H. Avedikian,
Jr.(3)................. 1996 $ 143,269 $ 45,000 9,000 $ 4,034
Vice President of
Operations 1995 $ 118,272 $ 41,000 10,000 $ 1,317
1994 $ 64,044 $ 23,000 22,500 $ 293
</TABLE>
- --------
(1) In accordance with the rules of the Securities and Exchange Commission,
other compensation in the form of perquisites and other personal benefits
has been omitted because such perquisites and other personal benefits
constituted less than the lesser of $50,000 or ten percent of the total
annual salary and bonus for the executive officer.
(2) The amounts reported include the Company's contributions to the Company's
Savings and Retirement Plan during fiscal 1996, fiscal 1995 and fiscal
1994, respectively, for the benefit of Mr. Wiesler ($5,200, $1,895 and
$1,281), Mr. Tyson ($4,973, $1,636 and $1,460), Mr. Schickling ($3,865,
$1,309 and $290), Mr. Postle ($3,629, $350 and $0), and Mr. Avedikian
($3,721, $1,171 and $232). The amounts reported also include premiums paid
by the Company on excess life insurance policies during fiscal 1996,
fiscal 1995 and fiscal 1994, respectively, for Mr. Wiesler ($6,300, $3,780
and $1,404), Mr. Tyson ($510, $306 and $204), Mr. Schickling ($2,182,
$1,147 and $396), Mr. Postle ($474, $252 and $41) and Mr. Avedikian ($313,
$146 and $61).
(3) Messrs. Schickling, Postle and Avedikian joined the Company during fiscal
1994 and, therefore received compensation for only a portion of such
fiscal year.
6
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR.
The following table contains information concerning stock option grants
under the 1994 Stock Option Plan to the Company's Chief Executive Officer and
each of the other Named Executive Officers made during fiscal 1996.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF STOCK
% OF TOTAL PRICE APPRECIATION FOR
OPTIONS GRANTED EXERCISE OR OPTION TERM(3)
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION ----------------------
NAME GRANTED (#)(1) FISCAL YEAR ($/SHARE)(2) DATE 5%($) 10%($)
---- -------------- --------------- ------------ ---------- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Mordechai Wiesler....... 4,941(4) 2.21% $27.25 11/01/01 $ 43,586 $ 98,223
6,759(5) 3.02% $27.25 11/01/01 $ 59,623 $ 134,363
Mitchell G. Tyson....... 4,353(4) 1.95% $27.25 11/01/01 $ 38,399 $ 86,534
10,947(5) 4.89% $27.25 11/01/01 $ 96,586 $ 217,617
John J. Schickling...... 7,143(4) 3.19% $27.25 11/01/01 $ 63,010 $ 141,997
1,857(5) 0.83% $27.25 11/01/01 $ 16,381 $ 36,916
Robert G. Postle........ 10,800(4) 4.83% $27.25 11/01/01 $ 95,270 $ 214,270
Stephen H. Avedikian,
Jr..................... 8,742(4) 3.91% $27.25 11/01/01 $ 77,960 $ 175,941
258(5) 0.12% $27.25 11/01/01 $ 2,276 $ 5,129
</TABLE>
- --------
(1) Incentive and nonqualified options vest at varying rates over five years.
The cumulative effect of the vesting schedule is that the aggregate number
of incentive and nonqualified options vesting in each of the 20 quarterly
vesting dates, beginning on 2/21/96 and ending on 11/1/00, is equal. This
table does not include options granted in November 1995 to purchase the
following numbers of shares of the Company's Common Stock: Mr. Wiesler,
13,000 shares; Mr. Tyson, 17,000 shares; Mr. Schickling, 10,000 shares;
Mr. Postle, 12,000 shares; and Mr. Avedikian, 10,000 shares. Each such
option was at an exercise price equal to $37.75 per share, was for a term
of six years and vested in 20 equal quarterly installments beginning
2/21/96 and ending 11/21/00. In February 1996, these options were
surrendered and exchanged for the options listed in the table above. See
"Option/SAR Repricing."
(2) All options were granted at not less than fair market value, which was
determined by the Board of Directors of the Company to be the closing
price of the Common Stock on the date of grant as reported by the Nasdaq
National Market.
(3) Amounts reported in this column represent hypothetical values that may be
realized upon exercise of the options immediately prior to the expiration
of their term, assuming the specified compounded rates of appreciation of
the Company's Common Stock over the term of the options. These numbers are
calculated based on rules promulgated by the Securities and Exchange
Commission and do not represent the Company's estimate of future stock
price growth. Actual gains, if any, on stock option exercises and Common
Stock holdings are dependent on the timing of such exercises and the
future performance of the Company's Common Stock. There can be no
assurance that the rates of appreciation assumed in this table can be
achieved or that the amounts reflected will be received by the
individuals. This table does not take into account any appreciation in the
price of the Common Stock from the date of grant to the current date. The
values shown are net of the option exercise price, but do not include
deductions for taxes or other expenses associated with the exercise.
(4) Represents an incentive stock option. See Note 1.
(5) Represents a nonqualified stock option. See Note 1.
7
<PAGE>
OPTION/SAR EXERCISES AND FISCAL YEAR-END VALUES
The following table sets forth information concerning option exercises and
holdings under the 1984 and 1994 Stock Option Plans as of September 30, 1996
with respect to the Company's Chief Executive Officer and the other Named
Executive Officers:
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
COMMON STOCK UNDERLYING VALUE OF UNEXERCISED IN-
UNEXERCISED OPTIONS AT THE-MONEY OPTIONS AT
SHARES VALUE FISCAL YEAR-END (#) FISCAL YEAR-END $(2)
ACQUIRED ON REALIZED ------------------------- -------------------------
NAME EXERCISE (#) ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ------------ ---------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mordechai Wiesler....... 57,375 $1,577,391 33,563 41,512 $ 835,046 $809,011
Mitchell G. Tyson....... 37,500 $ 980,875 80,170 46,630 $2,214,779 $882,996
John J. Schickling...... 7,350 $ 158,175 4,500 31,950 $ 87,638 $642,300
Robert G. Postle........ 3,000 $ 58,750 3,683 19,305 $ 59,968 $301,084
Stephen H. Avedikian,
Jr..................... -- -- 15,932 25,568 $ 373,465 $472,910
</TABLE>
- --------
(1) Amounts disclosed in this column do not necessarily reflect amounts
received by the Named Executive Officers but are calculated based on the
difference between the fair market value of the Company's Common Stock on
the date of exercise and the exercise price of the options. Named
Executive Officers will receive cash only if and when they sell the Common
Stock issued upon exercise of the options and the amount of cash received
by such individuals is dependent on the price of the Company's Common
Stock at the time of such sale.
(2) Calculated on the basis of the closing price of the Common Stock on
September 30, 1996 as reported by the Nasdaq National Market ($32.75 per
share), less the applicable option exercise price.
OPTION/SAR REPRICING
The following table sets forth information concerning the repricing during
fiscal 1996 of options previously awarded to the Named Executive Officers as
well as information concerning all such repricings of options held by an
executive officer of the Company during the ten fiscal years ended September
30, 1996. See Compensation Committee Report on Executive Compensation for
further information.
TEN-YEAR OPTION REPRICING
<TABLE>
<CAPTION>
NUMBER OF MARKET PRICE EXERCISE LENGTH OF
SECURITIES OF PRICE AT ORIGINAL OPTION
UNDERLYING STOCK AT TIME OF TERM REMAINING
OPTIONS/SARS TIME OF REPRICING NEW AT DATE OF
REPRICED OR REPRICING OR OR EXERCISE REPRICING OR
DATE AMENDED(1) AMENDMENT AMENDMENT PRICE AMENDMENT
---- ------------ ------------ --------- -------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
Mordechai Wiesler....... 2/1/96 4,941 $27.25 $37.75 $27.25 5 years 293 days
2/1/96 6,759 $27.25 $37.75 $27.25 5 years 293 days
Mitchell G. Tyson....... 2/1/96 4,353 $27.25 $37.75 $27.25 5 years 293 days
2/1/96 10,947 $27.25 $37.75 $27.25 5 years 293 days
John J. Schickling...... 2/1/96 7,143 $27.25 $37.75 $27.25 5 years 293 days
2/1/96 1,857 $27.25 $37.75 $27.25 5 years 293 days
Robert G. Postle........ 2/1/96 10,800 $27.25 $37.75 $27.25 5 years 293 days
Stephen H. Avedikian,
Jr..................... 2/1/96 8,742 $27.25 $37.75 $27.25 5 years 293 days
2/1/96 258 $27.25 $37.75 $27.25 5 years 293 days
James J. Costa.......... 2/1/96 4,500 $27.25 $37.75 $27.25 5 years 293 days
Douglas A. Lawson....... 2/1/96 3,600 $27.25 $37.75 $27.25 5 years 293 days
Mitchell Weiss.......... 2/1/96 6,750 $27.25 $37.75 $27.25 5 years 293 days
Diane M. DeLucia........ 2/1/96 4,500 $27.25 $37.75 $27.25 5 years 293 days
Walter F. Romanosky,
Jr..................... 2/1/96 6,750 $27.25 $37.75 $27.25 5 years 293 days
</TABLE>
- --------
(1) Aggregate number of securities underlying repriced options represents for
each executive officer 90% of the number of securities underlying option
as originally granted in November 1995. See Note 1 of "Option Grants in
Last Fiscal Year."
8
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee is a former or current employee of
the Company or a party to any other relationship of a character required to be
disclosed pursuant to Item 402(j) of Regulation S-K.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
This report has been furnished by the Compensation Committee of the Company.
Boruch B. Frusztajer and Alexander V. d'Arbeloff, two non-employee members of
the Board of Directors, serve as members of the Committee. The Committee meets
at least annually or more frequently if requested by the Board of Directors.
The Committee is primarily responsible for the review of executive
compensation, which includes base salary, profit sharing, and stock option
awards.
Compensation Policies. The Company believes that it is critical to its
continued success to attract and retain highly qualified executive officers
who will play a vital role in future achievements. To this end, the Company
has established its compensation policy to reward executives based upon
corporate, departmental and individual performance which is measured against
the internal goals set for each area. The Company also understands the need to
provide long term incentives to its executive officers to achieve future
financial and strategic goals which include the growth of the Company,
enhancement of Company profitability and thus shareholder value. The Company
believes that its total compensation is sufficiently competitive to retain
and, if necessary, attract executive officers capable of leading the Company
in accomplishing its business goals.
Executive compensation for fiscal 1996 consisted of a base salary, incentive
compensation in the form of an annual cash bonus earned as a result of
achievement of Company objectives, and equity-based long-term incentive
compensation in the form of incentive and nonqualified stock options. Since
options granted under the Company's 1994 Incentive and Nonqualified Stock
Option Plan generally vest over a five year period, option participants are
encouraged to improve the profitability and shareholder value of the Company.
Base Salaries. The salaries of the executive officers are established
annually by evaluating requirements of the position and the contribution of
the individual executive with respect to Company performance and the
executive's responsibility, technical experience and future potential. Base
salaries of the executive officers are generally adjusted annually in January
to reflect comparable executive salaries for comparably sized companies and to
maintain the objectives of the Compensation Policy noted above. In determining
base salaries, the Compensation Committee relies upon independent surveys of
companies in the industry to determine whether the Company's executive
compensation is in a competitive range for executives within the Company's
industry.
The base salary of Mordechai Wiesler, the Chief Executive Officer of the
Company was $211,153 for fiscal 1996. This represented an increase of 14.2%
from fiscal 1995.
Incentive Compensation. To reward performance, the Company provides
executives with additional cash compensation in the form of profit sharing
bonuses. Actual awards against target vary based on financial and non-
financial performance factors and individual contribution. The Company
achieved significantly higher levels of performance in fiscal 1996 compared to
fiscal 1995. Revenue increased by 73% to $110.6 million from $64 million in
fiscal 1995. Net income increased 82% in fiscal 1996 to $13.7 million from
$7.6 million in fiscal 1995. The improvement in financial performance in
conjunction with the attainment of non-financial goals resulted in a bonus of
$90,000 to Mr. Wiesler and bonus payments to the Company's other executive
officers ranging from $15,300 to $90,000 in fiscal 1996. Further detail of the
bonus compensation is disclosed in the Summary Compensation Table at page 6.
9
<PAGE>
Long-Term Incentives. One of the goals of the Company is the enhancement of
shareholder value. The principal incentive tool used to achieve this goal is
the periodic award to key employees of options to purchase Common Stock of the
Company. The stock option plan is a long-term plan designed to link executive
rewards to shareholder value over time. Stock options granted typically have a
term of six (6) years and vest in twenty quarterly installments over a period
of five (5) years from the date of grant. Long-term incentive compensation in
the form of incentive and nonqualified stock options under the Company's 1994
Incentive and Nonqualified Stock Option Plan were granted to the executive
officers. These grants included incentive and nonqualified options granted to
Messrs. Wiesler, Tyson, Schickling, Postle and Avedikian to purchase up to
11,700, 15,300, 9,000, 10,800 and 9,000 shares of Common Stock, respectively.
See "Option Grants in Last Fiscal Year" at page 7.
Report on Repricing of Options. The February 1996 repricing of options held
by certain Named Executive Officers described in the Ten-Year Option Repricing
table above reflects the consistent application of the policy of the
Compensation Committee regarding incentive options. The Compensation Committee
and full Board of Directors believe that to provide maximum incentive to
employees, including senior executives, incentive options should be granted at
exercise prices equal to or not materially in excess of the market price of
the Common Stock. As a result of this policy, options granted by the Board of
Directors and approved by the Compensation Committee on November 21, 1995 were
repriced on February 1, 1996 to more accurately reflect the market value of
the Company's Common Stock as determined by the closing price of the stock as
reported by the Nasdaq National Market on that date. In connection with the
repricing, employees, including executive officers, were provided the
opportunity to keep the original number of options granted at the November 21,
1995 price or receive an award reduced by ten percent (10%) at the price in
effect on February 1, 1996. All grant recipients elected to receive the share
reduction at the lower option price.
Boruch B. Frusztajer
Alexander V. d'Arbeloff
10
<PAGE>
PERFORMANCE GRAPH
The following Performance Graph compares the performance of the Company's
cumulative stockholder return with that of a broad market index, the Nasdaq
Stock Market Index for U.S. Companies, and a published industry index, the
Hambrecht & Quist Semiconductor Sector Index. The cumulative stockholder
returns for shares of the Company's Common Stock and for the market and
industry indices are calculated assuming $100 was invested on October 13,
1994, the date on which the Company's Common Stock commenced trading on the
Nasdaq National Market. The Company paid no cash dividends during the periods
shown. The performance of the market and industry indices is shown on a total
return (dividends reinvested) basis, calculated monthly as of the last day of
month indicated.
CUMULATIVE TOTAL RETURN PRI AUTOMATION, INC.
<TABLE>
<CAPTION>
H&Q
---
Nasdaq Stock Semiconductor
------------ -------------
DATES PRI Automation, Inc. Market-U.S. Sector
----- -------------------- ----------- ------
<S> <C> <C> <C>
10/13/94 100 100 100
Oct-94 112.96 103.17 109.51
Nov-94 124.07 99.75 106.94
Dec-94 119.44 100.03 106.95
Jan-95 118.52 100.59 108.71
Feb-95 133.33 105.91 122.14
Mar-95 164.81 109.05 129.15
Apr-95 194.44 112.48 147.43
May-95 209.26 115.38 159.60
Jun-95 242.59 124.74 181.26
Jul-95 303.70 133.90 206.77
Aug-95 279.63 136.62 202.91
Sep-95 303.70 139.76 204.85
Oct-95 274.07 138.96 192.49
Nov-95 303.70 142.22 170.34
Dec-95 260.19 141.47 148.84
Jan-96 211.11 142.17 146.82
Feb-96 176.85 147.58 147.57
Mar-96 181.48 148.07 140.57
Apr-96 209.26 160.36 161.05
May-96 295.37 167.72 156.06
Jun-96 225.93 160.14 134.72
Jul-96 194.44 145.84 119.60
Aug-96 216.67 154.04 130.90
Sep-96 242.59 165.75 152.94
</TABLE>
11
<PAGE>
1994 STOCK OPTION PLAN
In 1994 the Board adopted and the Company's stockholders approved the 1994
Stock Option Plan. The 1994 Stock Option Plan authorizes (i) the grant of
options to purchase Common Stock intended to qualify as incentive stock
options ("Incentive Options"), as defined in Section 422 of the Code, and (ii)
the grant of options that do not so qualify ("Nonqualified Options").
The 1994 Stock Option Plan currently provides that an aggregate of 905,000
shares of Common Stock (subject to adjustment upon certain changes in
capitalization of the Company) may be issued pursuant to options granted
thereunder. On November 8, 1996, the Board of Directors of the Company amended
the 1994 Stock Option Plan to increase the number of shares of Common Stock
issuable upon exercise of options under the Plan by 300,000. As of December
13, 1996, the number of shares remaining available for grants under the 1994
Stock Option Plan was 366,513. The Company expects that the number of shares
available under the 1994 Stock Option Plan, as amended, will be adequate to
provide for anticipated grants of options through fiscal 1998.
The 1994 Stock Option Plan is administered by a committee consisting of the
non-employee directors who are members of the Compensation Committee of the
Board (the "Committee"). Except for certain non-discretionary option grants to
directors who are not employees as described below, the Committee selects the
individuals to whom options are granted and determines the option exercise
price and other terms of each award, subject to the provisions of the 1994
Stock Option Plan. Incentive Options may be granted under the 1994 Stock
Option Plan to employees, including officers and directors who are also
employees. As of September 30, 1996, approximately 701 employees were eligible
to participate in the 1994 Stock Option Plan. Nonqualified Options may be
granted under the 1994 Stock Option Plan to employees, officers, individuals
providing services to the Company and directors, whether or not they are
employees of the Company.
No options may extend for more than ten years from the date of grant (five
years in the case of employees or officers holding 10% or more of the total
combined voting power of all classes of stock of the Company or any subsidiary
or parent ("greater-than-ten-percent-stockholder")). The exercise price for
Incentive Options may not be less than the fair market value of the Common
Stock on the date of grant (110% of fair market value in the case of a
greater-than-ten-percent-stockholder). The aggregate fair market value
(determined at the time of grant) of shares issuable pursuant to Incentive
Options which first become exercisable by an employee or officer in any
calendar year may not exceed $100,000.
Options are non-transferable except by will or by the laws of descent or
distribution. Options generally may not be exercised after (i) termination by
the Company for cause or voluntary termination by the optionee of an
optionee's employment with the Company, (ii) ninety days following termination
by the Company without cause of the optionee's employment with the Company, or
(iii) one year following an optionee's retirement from the Company in good
standing by reason of disability or death.
Payment of the exercise price for shares subject to options may be made with
(i) cash, certified check, bank draft, postal or express money order for an
amount equal to the option price for such shares, or (ii) with the consent of
the Committee, shares of Common Stock of the Company having a fair market
value equal to the option price of such shares, or (iii) with the consent of
the Committee, such other consideration which is acceptable to the Committee
and which has a fair market value equal to the option price of such shares, or
(iv) with the consent of the Committee, a combination of the (i), (ii) and/or
(iii). Full payment for shares exercised must be made at the time of exercise.
12
<PAGE>
Under the 1994 Stock Option Plan, on November 30 of each year, each non-
employee director then in office is automatically granted a Nonqualified
Option to purchase 1,500 shares of Common Stock at an exercise price equal to
the fair market value of the Common Stock at the date of grant.
At September 30, 1996, 487,484 shares were subject to outstanding options
granted under the 1994 Stock Option Plan, 42,254 had been purchased upon
exercise of options granted thereunder and 375,262 shares remained available
for future grants. As of September 30, 1996, option prices and expiration
dates for outstanding options granted under the 1994 Stock Option Plan ranged
from $6.6667 to $41.00 per share and from March 17, 2000 to April 22, 2006,
respectively. The Company has filed registration statements on Form S-8 under
the Securities Act of 1933 to register the 905,000 shares of the Company's
Common Stock that were reserved for issuance under the 1994 Stock Option Plan.
The Company intends to file, as soon as practicable, a Registration Statement
on Form S-8 under the Securities Act of 1933 covering the additional shares of
Common Stock issuable under the 1994 Stock Option Plan, as further amended.
FEDERAL INCOME TAX INFORMATION WITH RESPECT TO THE 1994 STOCK OPTION PLAN
The grantee of a Nonqualified Option under the 1994 Stock Option Plan
recognizes no income for federal income tax purposes on the grant thereof. On
the exercise of a Nonqualified Option, the difference between the fair market
value of the underlying shares of Common Stock on the exercise date and the
option exercise price is treated as compensation to the holder of the option
taxable as ordinary income in the year of exercise, and such fair market value
becomes the basis for the underlying shares which will be used in computing
any capital gain or loss upon disposition of such shares. Subject to certain
limitations, the Company may deduct for the year of exercise an amount equal
to the amount recognized by the option holder as ordinary income upon exercise
of a Nonqualified Option.
The grantee of an Incentive Option under the 1994 Stock Option Plan
recognizes no income for federal income tax purposes on the grant thereof.
Except as described below with respect to the alternative minimum tax, there
is no tax upon exercise of an Incentive Option. If no disposition of shares
acquired upon exercise of the Incentive Option is made by the option holder
within two years from the date of the grant of the Incentive Option or within
one year after exercise of the Incentive Option, any gain realized by the
option holder on the subsequent sale of such shares is treated as a long-term
capital gain for federal income tax purposes. If the shares are sold prior to
the expiration of such periods, the difference between the lesser of the value
of the shares at the date of exercise or at the date of sale and the exercise
price of the Incentive Option is treated as compensation to the employee
taxable as ordinary income and the excess gain, if any, is treated as capital
gain (which will be long-term capital gain if the shares are held for more
than one year).
The excess of the fair market value of the underlying shares over the option
price at the time of exercise of an Incentive Option will constitute an item
of tax preference for purposes of the alternative minimum tax. Taxpayers who
incur the alternative minimum tax are allowed a credit which may be carried
forward indefinitely to be used as a credit against regular tax liability in a
later year; however, the minimum tax credit cannot reduce the regular tax
below the alternative minimum tax for that carryover year.
In connection with the sale of the shares covered by Incentive Options,
under the 1994 Stock Option Plan, the Company is allowed a deduction for tax
purposes only to the extent, and at the time, the option holder receives
ordinary income (for example, by reason of the sale of shares by the holder of
an Incentive Option within two years of the date of the granting of the
Incentive Option or one year after the exercise of the Incentive Option),
subject to certain limitations on the deductibility of compensation paid to
executives.
13
<PAGE>
NEW PLAN BENEFITS
The Company is unable to determine the dollar value and number of options or
shares of Common Stock that will be issued under the 1994 Stock Option Plan if
the amendment described herein is approved to (i) any of the executive
officers, (ii) the current executive officers as a group, (iii) the current
directors who are not executive officers as a group, (iv) each nominee for
election as a director and (v) the employees who are not executive officers as
a group, because, except for non-discretionary option grants to non-employee
directors described above, options are granted on a discretionary basis. The
Company is unable to determine the benefits or amounts which would have been
received by or allocated to any such persons or groups for fiscal 1996 if the
amendment to the 1994 Stock Option Plan had been in effect throughout such
year.
14
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of December 20, 1996 (i)
by each person or entity known to the Company to own beneficially five percent
or more of the Company's Common Stock, (ii) by each director of the Company,
(iii) by each Named Executive Officer and (iv) by all executive officers and
directors of the Company as a group.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)(2)
-----------------------
NAME NUMBER PERCENT
---- ------------ ----------
<S> <C> <C>
Mordechai Wiesler(3)(4)................................ 517,246 7.0%
Twentieth Century Companies, Inc.(5) .................. 380,100 5.2%
4500 Main Street
P.O. Box 418210
Kansas City, MO 64141-9210
Dr. Amram Rasiel(3)(6)................................. 280,855 3.8%
Mitchell G. Tyson(3)(7)................................ 123,158 1.7%
Boruch B. Frusztajer(3)(8)............................. 46,256 *
Alexander V. d'Arbeloff(3)(9).......................... 36,892 *
Stephen H. Avedikian, Jr.(3)(10)....................... 8,059 *
John J. Schickling(3)(11).............................. 2,250 *
Robert G. Postle(3)(12)................................ 843 *
All directors and executive officers as a group (14
people)(13)........................................... 1,114,472 14.8%
</TABLE>
- --------
*Less than one percent.
(1) The persons named in this table have sole voting and investment power with
respect to all shares of Common Stock shown as beneficially owned by them,
subject to community property laws where applicable and subject to the
information contained in the footnotes to this table. Amounts shown for
each stockholder include those shares subject to stock options exercisable
within 60 days of December 20, 1996.
(2) The number of shares of Common Stock deemed outstanding as of the date of
this table is 7,346,166.
(3) Address is in care of PRI Automation, Inc., 805 Middlesex Turnpike,
Billerica, Massachusetts 01821.
(4) Includes 35,461 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996. Excludes 45,000 shares
held in two trusts for the benefit of Mr. Wiesler's three children. Mr.
Wiesler disclaims beneficial ownership of these shares.
(5) The number of shares beneficially owned by Twentieth Century Companies,
Inc. ("TCC") is based on the information contained in a Schedule 13G filed
by TCC on behalf of itself, Investors Research Corporation and James E.
Stowers, Jr. on February 12, 1996. Investors Research Corporation, a
registered investment advisor and a wholly-owned subsidiary of TCC,
manages the investments of six registered investment companies and certain
institutional investor accounts. These investments include 380,100 shares
of the Company's Common Stock. Mr. Stowers controls TCC by virtue of his
beneficial ownership of a majority of the voting stock of TCC. TCC,
Investors Research Corporation and Mr. Stowers all disclaim beneficial
ownership of these shares.
(6) Includes 6,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
(7) Includes 85,935 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
(8) Includes 6,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996. Includes 29,381 shares
held by members of Mr. Frusztajer's family.
(9) Includes 6,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
(10) Includes 7,444 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
(11) Includes 2,250 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
15
<PAGE>
(12) Represents 843 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
(13) Includes 174,940 shares issuable upon the exercise of outstanding options
exercisable within 60 days of December 20, 1996.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of a registered
class of the Company's equity securities to file reports of ownership and
changes in ownership with the Securities and Exchange Commission (the "SEC").
Officers, directors and greater-than-10% stockholders are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file.
Based solely upon review of Forms 3 and 4 and amendments thereto furnished
to the Company during fiscal 1996 and Forms 5 and amendments thereto furnished
to the Company with respect to fiscal 1996, or written representations that
Forms 5 were not required, the Company believes that all Section 16(a) filing
requirements applicable to its officers, directors and greater-than-10%
stockholders were fulfilled in a timely manner.
SOLICITATION
No compensation will be paid by any person in connection with the
solicitation of proxies. Brokers, banks and other nominees will be reimbursed
for their out-of-pocket expenses and other reasonable clerical expenses
incurred in obtaining instructions from beneficial owners of the Common Stock.
In addition to the solicitation by mail, special solicitation of proxies may,
in certain instances, be made personally or by telephone by directors,
officers and certain employees of the Company. It is expected that the expense
of such special solicitation will be nominal. All expenses incurred in
connection with this solicitation will be borne by the Company.
STOCKHOLDER PROPOSALS
Stockholder proposals for inclusion in the proxy materials related to the
1998 Annual Meeting of Stockholders or Special Meeting in lieu thereof must be
received by the Company at its Executive Offices no later than September 8,
1997.
MISCELLANEOUS
The Board does not intend to present to the Annual Meeting any business
other than the proposals listed herein, and the Board was not aware, a
reasonable time before mailing this Proxy Statement to stockholders, of any
other business which may be properly presented for action at the Annual
Meeting. If any other business should come before the Annual Meeting, the
persons present will have discretionary authority to vote the shares they own
or represent by proxy in accordance with their judgment.
AVAILABLE INFORMATION
Stockholders of record on December 13, 1996 will receive a Proxy Statement
and the Company's Annual Report to Stockholders, which contains detailed
financial information concerning the Company. The Company will mail, without
charge, a copy of the Company's Annual Report on Form 10-K (excluding
exhibits) to any stockholder solicited hereby who requests it in writing.
Please submit any such written request to Mr. John J. Schickling, PRI
Automation, Inc., 805 Middlesex Turnpike, Billerica, Massachusetts 01821.
16
<PAGE>
As amended by the Board of
Directors on November 8, 1996
PRI AUTOMATION, INC.
1994 INCENTIVE AND NONQUALIFIED
STOCK OPTION PLAN
SECTION 1. PURPOSE
This 1994 Incentive and Nonqualified Stock Option Plan (the "Plan") of PRI
Automation, Inc., a Massachusetts corporation (the "Company"), is designed to
provide additional incentive to executives and other key employees of the
Company and its subsidiaries and for certain other individuals providing
services to or acting as directors of the Company and its subsidiaries. The
Company intends that this purpose will be effected by the granting of incentive
stock options ("Incentive Stock Options") as defined in Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"), and nonqualified stock
options ("Nonqualified Options") under the Plan which afford such executives and
key employees an opportunity to acquire or increase their proprietary interest
in the Company through the acquisition of shares of its Common Stock. The
Company intends that Incentive Stock Options issued under the Plan will qualify
as "incentive stock options" as defined in Section 422 of the Code and the terms
of the Plan shall be interpreted in accordance with this intention. The term
"subsidiary" shall have the meaning set forth in Section 424 of the Code.
SECTION 2. ADMINISTRATION
2.1 The Committee. The Plan shall be administered by a Committee (the
-------------
1
<PAGE>
"Committee") consisting of the "Outside Directors" who are also members of the
Compensation Committee. As used herein, the term "Outside Director" means any
director who (i) is not an employee of the Company or of any "affiliated group,"
as such term is defined in Section 1504(a) of the Code, which includes the
Company (an "Affiliate"), (ii) is not a former employee of the Company or any
Affiliate who is receiving compensation for prior services (other than benefits
under a tax-qualified retirement plan) during the Company's or any Affiliate's
taxable year, (iii) has not been an officer of the Company or any Affiliate and
(iv) does not receive remuneration from the Company or any Affiliate, either
directly or indirectly, in any capacity other than as a director. None of the
members of the Committee shall have been granted any incentive stock option or
nonqualified option under this Plan or any other stock option plan of the
Company within one year prior to service on the Committee. It is the intention
of the Company that the Plan shall be administered by "disinterested persons"
within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, but
the authority and validity of any act taken or not taken by the Committee shall
not be affected if any person administering the Plan is not a disinterested
person. Except as specifically reserved to the Company's Board of Directors
(the "Board") under the terms of the Plan, the Committee shall have full and
final authority to operate, manage and administer the Plan on behalf of the
Company. Action by the Committee shall require the affirmative vote of a
majority of all members thereof.
2.2 Powers of the Committee. Subject to the terms and conditions of the
-----------------------
Plan, the Committee shall have the power:
(a) To determine from time to time the persons eligible to receive
options and the options to be granted to such persons under the Plan and to
prescribe the terms,
2
<PAGE>
conditions, restrictions, if any, and provisions
(which need not be identical) of each option granted under the Plan to such
persons;
(b) To construe and interpret the Plan and options granted thereunder
and to establish, amend, and revoke rules and regulations for
administration of the Plan. In this connection, the Committee may correct
any defect or supply any omission, or reconcile any inconsistency in the
Plan, or in any option agreement, in the manner and to the extent it shall
deem necessary or expedient to make the Plan fully effective. All decisions
and determinations by the Committee in the exercise of this power shall be
final and binding upon the Company and optionees ;
(c) To make, in its sole discretion, changes to any outstanding option
granted under the Plan, including: (i) to reduce the exercise price, (ii)
to accelerate the vesting schedule or (iii) to extend the expiration date;
and
(d) Generally, to exercise such powers and to perform such acts as are
deemed necessary or expedient to promote the best interests of the Company
with respect to the Plan.
SECTION 3. STOCK
3.1 Stock to be Issued. The stock subject to the options granted under
------------------
the Plan shall be shares of the Company's authorized but unissued common stock,
$.01 par value (the "Common Stock"), or shares of the Company's Common Stock
held in treasury. The total number of shares that may be issued pursuant to
options granted under the Plan shall not exceed an aggregate of 1,205,000 shares
of Common Stock; provided, however, that the class and
3
<PAGE>
aggregate number of shares which may be subject to options granted under the
Plan shall be subject to adjustment as provided in Section 8 hereof.
3.2 Expiration, Cancellation or Termination of Option. Whenever any
-------------------------------------------------
outstanding option under the Plan expires, is cancelled or is otherwise
terminated (other than by exercise), the shares of Common Stock allocable to the
unexercised portion of such option may again be the subject of options under the
Plan.
3.3 Limitation on Grants. In no event may any Plan participant be granted
--------------------
options with respect to more than 75,000 shares of Common Stock in any calendar
year. The number of shares of Common Stock issuable pursuant to an option
granted to a Plan participant in a calendar year that is subsequently forfeited,
cancelled or otherwise terminated shall continue to count toward the foregoing
limitation in such calendar year. In addition, if the exercise price of an
option is subsequently reduced, the transaction shall be deemed a cancellation
of the original option and the grant of a new one so that both transactions
shall count toward the maximum shares issuable in the calendar year of each
respective transaction.
SECTION 4. ELIGIBILITY
4.1 Persons Eligible. Incentive Stock Options under the Plan may be
----------------
granted only to officers and other employees of the Company or its subsidiaries.
Nonqualified Options may be granted to officers or other employees of the
Company or its subsidiaries, and to members of the Board and consultants or
other persons who render services to the Company (regardless of whether they are
also employees), provided, however, that no such option may be granted to a
person who is a member of the Committee at the time of grant.
4
<PAGE>
4.2 Greater-Than-Ten-Percent Stockholders. Except as may otherwise be
-------------------------------------
permitted by the Code or other applicable law or regulation, no Incentive Stock
Option shall be granted to an individual who, at the time the option is granted,
owns (including ownership attributed pursuant to Section 425 of the Code) more
than ten percent of the total combined voting power of all classes of stock of
the Company or any subsidiary (a "greaterthan-ten-percent stockholder"), unless
such Incentive Stock Option provides that (i) the purchase price per share shall
not be less than one hundred ten percent of the fair market value of the Common
Stock at the time such option is granted, and (ii) that such option shall not be
exercisable to any extent after the expiration of five years from the date it is
granted.
4.3 Maximum Aggregate Fair Market Value. The aggregate fair market value
-----------------------------------
(determined at the time the option is granted) of the Common Stock with respect
to which Incentive Stock Options are exercisable for the first time by any
optionee during any calendar year (under the Plan and any other plans of the
Company or its subsidiary for the issuance of incentive stock options) shall not
exceed $100,000 (or such greater amount as may from time to time be permitted
with respect to incentive stock options by the Code or any other applicable law
or regulation).
4.4 Option Grants to Directors. As compensation for services to the
--------------------------
Company, each director of the Company who is not an employee of the Company and
who is not an officer, director, general partner or employee of a securities
firm, venture capital firm or other financial institution which, together with
its affiliates, holds more than 5% of the issued and outstanding Common Stock of
the Company (an "Outside Disinterested Director") shall be automatically granted
an option to purchase 1,500 shares of Common Stock on November 30 of each year,
5
<PAGE>
provided that the optionee is then a director of the Company. Any director of
the Company who is elected to the Board but who is not an Outside Disinterested
Director at the time of his or her initial election and later becomes an Outside
Disinterested Director shall be automatically granted an option to purchase
1,500 shares of Common Stock on November 30 of each year, provided that the
optionee is then a director of the Company. Each Nonqualified Option granted to
an Outside Disinterested Director pursuant to this Section 4.4 shall be
exercisable in its entirety on the date of grant and shall expire on the tenth
anniversary of the date of grant, provided the optionee is a director of the
Company on each such anniversary. The exercise price per share of Common Stock
of each Nonqualified Option granted pursuant to this Section 4.4 shall be equal
to the fair market value of the Common Stock on the date the Nonqualified Option
is granted, such fair market value to be determined in accordance with the
provisions of Section 6.3.
SECTION 5. TERMINATION OF EMPLOYMENT OR DEATH OF OPTIONEE
5.1 Termination of Employment. Except as may be otherwise expressly
-------------------------
provided herein, options shall terminate on the earlier of:
(a) the date of expiration thereof,
(b) the date of termination of the optionee's employment with or
services to the Company by it for cause (as determined by the Company), or
voluntarily by the optionee; or
(c) ninety days after the date of termination of the optionee's
employment with or services to the Company by it without cause; provided,
--------
that Nonqualified Options
6
<PAGE>
granted to persons who are not employees of the Company need not, unless
the Committee determines otherwise, be subject to the provisions set forth
in clauses (b) and (c) above.
An employment relationship between the Company and the optionee shall be deemed
to exist during any period in which the optionee is employed by the Company or
any subsidiary. Whether authorized leave of absence, or absence on military or
government service, shall constitute termination of the employment relationship
between the Company and the optionee shall be determined by the Committee at the
time thereof.
As used herein, "cause" shall mean (x) any material breach by the optionee
of any agreement to which the optionee and the Company are both parties, (y) any
act or omission to act by the optionee which may have a material and adverse
effect on the Company's business or on the optionee's ability to perform
services for the Company, including, without limitation, the commission of any
crime (other than ordinary traffic violations), or (z) any material misconduct
or material neglect of duties by the optionee in connection with the business or
affairs of the Company or any affiliate of the Company.
5.2 Death or Permanent Disability of Optionee. In the event of the death
-----------------------------------------
or permanent and total disability of the holder of an option that is subject to
clause (b) or (c) of Section 5.1 above prior to termination of the optionee's
employment with or services to the Company and before the date of expiration of
such option, such option shall terminate on the earlier of such date of
expiration or one year following the date of such death or disability. After
the death of the optionee, his/her executors, administrators or any person or
persons to whom his/her option may be transferred by will or by the laws of
descent and distribution, shall
7
<PAGE>
have the right, at any time prior to such termination, to exercise the option to
the extent the optionee was entitled to exercise such option immediately prior
to his/her death. An optionee is permanently and totally disabled if he/she is
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to last for a
continuous period of not less than 12 months; permanent and total disability
shall be determined in accordance with Section 22(e)(3) of the Code and the
regulations issued thereunder.
SECTION 6. TERMS OF THE OPTION AGREEMENTS
Each option agreement shall be in writing and shall contain such terms,
conditions, restrictions, if any, and provisions as the Committee shall from
time to time deem appropriate. Such provisions or conditions may include
without limitation restrictions on transfer, repurchase rights, or such other
provisions as shall be determined by the Committee; provided that such
-------------
additional provisions shall not be inconsistent with any other term or condition
of the Plan and such additional provisions shall not cause any Incentive Stock
Option granted under the Plan to fail to qualify as an incentive option within
the meaning of Section 422 of the Code. The shares of stock issuable upon
exercise of an option by any executive officer, director or beneficial owner of
more than ten percent of the Common Stock of the Company may not be sold or
transferred (except that such shares may be issued upon exercise of such option)
by such officer, director or beneficial owner for a period of six months
following the grant of such option.
Option agreements need not be identical, but each option agreement by
appropriate language shall include the substance of all of the following
provisions:
8
<PAGE>
6.1 Expiration of Option. Notwithstanding any other provision of the Plan
--------------------
or of any option agreement, each option shall expire on the date specified in
the option agreement, which date shall not, in the case of an Incentive Stock
Option, be later than the tenth anniversary (fifth anniversary in the case of a
greater-than-ten-percent stockholder) of the date on which the option was
granted, or as specified in Section 5 of this Plan.
6.2 Exercise. Each option may be exercised, so long as it is valid and
--------
outstanding, from time to time in part or as a whole, subject to any limitations
with respect to the number of shares for which the option may be exercised at a
particular time and to such other conditions as the Committee in its discretion
may specify upon granting the option.
6.3 Purchase Price. The purchase price per share under each option shall
--------------
be determined by the Committee at the time the option is granted; provided,
however, that the option price of any Incentive Stock Option shall not, unless
otherwise permitted by the Code or other applicable law or regulation, be less
than the fair market value of the Common Stock on the date the option is granted
(110% of the fair market value in the case of a greater-than-ten-percent
stockholder). For the purpose of the Plan the fair market value of the Common
Stock shall be the closing price per share on the date of grant of the option as
reported by a nationally recognized stock exchange, or, if the Common Stock is
not listed on such an exchange, as reported by the National Association of
Securities Dealers Automated Quotation System, Inc. ("NASDAQ"), or, if the
Common Stock is not quoted on NASDAQ, the fair market value as determined by the
Committee.
9
<PAGE>
6.4 Transferability of Options. Options shall not be transferable by the
--------------------------
optionee otherwise than by will or under the laws of descent and distribution,
and shall be exercisable, during his or her lifetime, only by him or her.
6.5 Rights of Optionees. No optionee shall be deemed for any purpose to
-------------------
be the owner of any shares of Common Stock subject to any option unless and
until the option shall have been exercised pursuant to the terms thereof, and
the Company shall have issued and delivered the shares to the optionee.
6.6 Repurchase Right. The Committee may in its discretion provide upon
----------------
the grant of any option hereunder that the Company shall have an option to
repurchase upon such terms and conditions as determined by the Committee all or
any number of shares purchased upon exercise of such option. The repurchase
price per share payable by the Company shall be such amount or be determined by
such formula as is fixed by the Committee at the time the option for the shares
subject to repurchase is granted. In the event the Committee shall grant
options subject to the Company's repurchase option, the certificates
representing the shares purchased pursuant to such option shall carry a legend
satisfactory to counsel for the Company referring to the Company's repurchase
option.
SECTION 7. METHOD OF EXERCISE; PAYMENT OF PURCHASE PRICE
7.1 Method of Exercise. Any option granted under the Plan may be
------------------
exercised by the optionee by delivering to the Company on any business day a
written notice specifying the number of shares of Common Stock the optionee then
desires to purchase and specifying the
10
<PAGE>
address to which the certificates for such shares are to be mailed (the
"Notice"), accompanied by payment for such shares.
7.2 Payment of Purchase Price. Payment for the shares of Common Stock
-------------------------
purchased pursuant to the exercise of an option shall be made either by (i)
cash, certified check, bank draft or postal or express money order equal to the
option price for the number of shares specified in the Notice, or (ii) with the
consent of the Committee, shares of Common Stock of the Company having a fair
market value equal to the option price of such shares, or (iii) with the consent
of the Committee, such other consideration which is acceptable to the Committee
and which has a fair market value equal to the option price of such shares, or
(iv) with the consent of the Committee, a combination of (i), (ii) and/or (iii).
For the purpose of the preceding sentence, the fair market value per share of
Common Stock so delivered to the Company shall be determined in the manner
specified in Section 6.3. As promptly as practicable after receipt of the
Notice and accompanying payment, the Company shall deliver to the optionee
certificates for the number of shares with respect to which such option has been
so exercised, issued in the optionee's name; provided, however, that such
delivery shall be deemed effected for all purposes when the Company or a stock
transfer agent of the Company shall have deposited such certificates in the
United States mail, addressed to the optionee, at the address specified in the
Notice.
SECTION 8. CHANGES IN COMPANY'S CAPITAL STRUCTURE
8.1 Rights of Company. The existence of outstanding options shall not
-----------------
affect in any way the right or power of the Company or its stockholders to make
or authorize, without limitation,
11
<PAGE>
any or all adjustments, recapitalizations, reorganizations or other changes in
the Company's capital structure or its business, or any merger or consolidation
of the Company, or any issue of Common Stock, or any issue of bonds, debentures,
preferred or prior preference stock or other capital stock ahead of or affecting
the Common Stock or the rights thereof, or the dissolution or liquidation of the
Company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or
otherwise.
8.2 Recapitalization, Stock Splits and Dividends. If the Company shall
--------------------------------------------
effect a subdivision or consolidation of shares or other capital readjustment,
the payment of a stock dividend, or other increase or reduction of the number of
shares of the Common Stock outstanding, in any such case without receiving
compensation therefor in money, services or property, then (i) the number,
class, and price per share of shares of stock subject to outstanding options
hereunder shall be appropriately adjusted in such a manner as to entitle an
optionee to receive upon exercise of an option, for the same aggregate cash
consideration, the same total number and class of shares as he or she would have
received as a result of the event requiring the adjustment had he or she
exercised his or her option in full immediately prior to such event; (ii) the
number and class of shares with respect to which options may be granted under
the Plan; and (iii) the number and class of shares set forth in Sections 3.3 and
4.4 shall be adjusted by substituting for the total number of shares of Common
Stock then reserved for issuance under the Plan that number and class of shares
of stock that the owner of an equal number of outstanding shares of Common Stock
would own as the result of the event requiring the adjustment.
12
<PAGE>
8.3 Merger without Change of Control. After a merger of one or more
--------------------------------
corporations into the Company, or after a consolidation of the Company and one
or more corporations in which (i) the Company shall be the surviving
corporation, and (ii) the stockholders of the Company immediately prior to such
merger or consolidation own after such merger or consolidation shares
representing at least fifty percent of the voting power of the Company, each
holder of an outstanding option shall, at no additional cost, be entitled upon
exercise of such option to receive in lieu of the number of shares as to which
such option shall then be so exercisable, the number and class of shares of
stock or other securities to which such holder would have been entitled pursuant
to the terms of the agreement of merger or consolidation if, immediately prior
to such merger or consolidation, such holder had been the holder of record of a
number of shares of Common Stock equal to the number of shares for which such
option was exercisable.
8.4 Sale or Merger with Change of Control. If the Company is merged into
-------------------------------------
or consolidated with another corporation under circumstances where the Company
is not the surviving corporation, or if there is a merger or consolidation where
the Company is the surviving corporation but the stockholders of the Company
immediately prior to such merger or consolidation do not own after such merger
or consolidation shares representing at least fifty percent of the voting power
of the Company, or if the Company is liquidated, or sells or otherwise disposes
of substantially all of its assets to another corporation while unexercised
options remain outstanding under the Plan, (i) subject to the provisions of
clause (iii) below, after the effective date of such merger, consolidation,
liquidation, sale or disposition, as the case may be, each holder of an
outstanding option shall be entitled, upon exercise of such option, to
13
<PAGE>
receive, in lieu of shares of Common Stock, shares of such stock or other
securities, cash or property as the holders of shares of Common Stock received
pursuant to the terms of the merger, consolidation, liquidation, sale or
disposition; (ii) the Committee may accelerate the time for exercise of all
unexercised and unexpired options to and after a date prior to the effective
date of such merger, consolidation, liquidation, sale or disposition, as the
case may be, specified by the Committee; or (iii) all outstanding options may be
cancelled by the Committee as of the effective date of any such merger,
consolidation, liquidation, sale or disposition provided that (x) notice of such
cancellation shall be given to each holder of an option and (y) each holder of
an option shall have the right to exercise such option to the extent that the
same is then exercisable or, if the Committee shall have accelerated the time
for exercise of all unexercised and unexpired options, in full during the 30-day
period preceding the effective date of such merger, consolidation, liquidation,
sale or disposition.
8.5 Adjustments to Common Stock Subject to Options. Except as
----------------------------------------------
hereinbefore expressly provided, the issue by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, for cash
or property, or for labor or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock then subject to
outstanding options.
8.6 Miscellaneous. Adjustments under this Section 8 shall be determined
-------------
by the Committee, and such determinations shall be conclusive. No fractional
shares of Common Stock shall be issued under the Plan on account of any
adjustment specified above.
14
<PAGE>
SECTION 9. GENERAL RESTRICTIONS
9.1 Investment Representations. The Company may require any person to
--------------------------
whom an option is granted, as a condition of exercising such option, to give
written assurances in substance and form satisfactory to the Company to the
effect that such person is acquiring the Common Stock subject to the option for
his or her own account for investment and not with any present intention of
selling or otherwise distributing the same, and to such other effects as the
Company deems necessary or appropriate in order to comply with federal and
applicable state securities laws.
9.2 Compliance with Securities Laws. The Company shall not be required to
-------------------------------
sell or issue any shares under any option if the issuance of such shares shall
constitute a violation by the optionee or by the Company of any provisions of
any law or regulation of any governmental authority. In addition, in
connection with the Securities Act of 1933, as now in effect or hereafter
amended (the "Act"), upon exercise of any option, the Company shall not be
required to issue such shares unless the Committee has received evidence
satisfactory to it to the effect that the holder of such option will not
transfer such shares except pursuant to a registration statement in effect under
such Act or unless an opinion of counsel satisfactory to the Company has been
received by the Company to the effect that such registration is not required.
Any determination in this connection by the Committee shall be final, binding
and conclusive. In the event the shares issuable on exercise of an option are
not registered under the Act, the Company may imprint upon any certificate
representing shares so issued the following legend or any other legend which
counsel for the Company considers necessary or advisable to comply with the Act
and with applicable state securities laws:
15
<PAGE>
The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 or under the securities
laws of any State and may not be sold or transferred except upon such
registration or upon receipt by the Corporation of an opinion of
counsel satisfactory to the Corporation, in form and substance
satisfactory to the Corporation, that registration is not required for
such sale or transfer.
The Company may, but shall in no event be obligated to, register any
securities covered hereby pursuant to the Act; and in the event any shares are
so registered the Company may remove any legend on certificates representing
such shares. The Company shall not be obligated to take any other affirmative
action in order to cause the exercise of an option or the issuance of shares
pursuant thereto to comply with any law or regulation of any governmental
authority.
9.3 Employment Obligation. The granting of any option shall not impose
---------------------
upon the Company any obligation to employ or continue to employ any optionee;
and the right of the Company to terminate the employment of any officer or other
employee shall not be diminished or affected by reason of the fact that an
option has been granted to him or her.
SECTION 10. AMENDMENT OR TERMINATION OF THE PLAN
The Board of Directors may modify, revise or terminate this Plan at any
time and from time to time, except that the class of persons eligible to receive
options and the aggregate number of shares issuable pursuant to this Plan shall
not be changed or increased, other than by operation of Section 8 hereof,
without the consent of the stockholders of the Company.
16
<PAGE>
SECTION 11. NONEXCLUSIVITY OF THE PLAN
Neither the adoption of the Plan by the Board of Directors nor the
submission of the Plan to the stockholders of the Company for approval shall be
construed as creating any limitations on the power of the Board of Directors to
adopt such other incentive arrangements as it may deem desirable, including,
without limitation, the granting of stock options otherwise than under the
Plan, and such arrangements may be either applicable generally or only in
specific cases.
SECTION 12. EFFECTIVE DATE AND DURATION OF PLAN
The Plan shall become effective upon its adoption by the Board of Directors
provided that the stockholders of the Company shall have approved the Plan
within twelve months prior to or following the adoption of the Plan by the
Board. No option may be granted under the Plan after the tenth anniversary of
the effective date. The Plan shall terminate (i) when the total amount of the
Stock with respect to which options may be granted shall have been issued upon
the exercise of options or (ii) by action of the Board of Directors pursuant to
Section 10 hereof, whichever shall first occur.
* * * * * * * *
17
<PAGE>
PRI AUTOMATION, INC.
805 MIDDLESEX TURNPIKE, BILLERICA, MASSACHUSETTS 01821
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON FEBRUARY 7, 1997
The undersigned hereby constitutes and appoints Mordechai Wiesler, Mitchell G.
Tyson and John J. Schickling, and each of them acting singly, as proxies of the
undersigned, each with full power to appoint his substitute, and authorizes each
of them, and each substitute so appointed, to represent and vote all shares of
Common Stock of PRI Automation, Inc. (the "Company") held of record by the
undersigned at the close of business on December 13, 1996, at the Annual Meeting
of Stockholders of the Company to be held at the offices of Foley, Hoag & Eliot
LLP, One Post Office Square, Boston, Massachusetts on February 7, 1997, at 10:00
a.m., local time, and at any adjournments thereof.
When properly executed, this proxy will be voted in the manner directed herein
by the undersigned stockholder(s). IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1 AND 2 AND IN THE DISCRETION OF THE PERSONS NAMED AS
PROXIES AS TO SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING. A
stockholder wishing to vote in accordance with the recommendations of the Board
of Directors need only sign and date this proxy and return it in the enclosed
envelope.
The undersigned hereby acknowledge(s) receipt of a copy of the accompanying
Notice of Annual Meeting of Stockholders and of the Proxy Statement relating
thereto, and hereby revoke(s) any proxy or proxies heretofore given. This proxy
may be revoked at any time before it is exercised.
- --------------------------------------------------------------------------------
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
- --------------------------------------------------------------------------------
Please sign this proxy exactly as your name appears on the books of the Company.
Joint owners should each sign personally. Trustees, custodians, and other
fiduciaries should indicate the capacity in which they sign, and where more than
one name appears, each person must sign. If the shareholder is a corporation,
the signature should be that of an authorized officer who should state his or
her title.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
__________________________________ ________________________________________
__________________________________ ________________________________________
1
<PAGE>
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. Proposal to fix the number
of directors that shall With- For All
PRI AUTOMATION, INC. constitute the whole Board For Hold Except
of Directors of the Company
at five and to elect the [_] [_] [_]
following nominees as
directors of the Company:
MORDECHAI WIESLER, MITCHELL G. TYSON,
RECORD DATE SHARES: AMRAM RASIEL, BORUCH B. FRUSZTAJER
AND ALEXANDER V. D'ARBELOFF
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR
ANY INDIVIDUAL NOMINEE, MARK THE "EXCEPTIONS" BOX
AND STRIKE A LINE THROUGH THAT NOMINEE'S NAME.
2. Proposal to approve the
amendment of the Company's
1994 Incentive and
Nonqualified Stock Option
Plan to increase the number
of shares available for grant For Against Abstain
thereunder by 300,000.
[_] [_] [_]
</TABLE>
Please be sure to sign and date this Proxy. Date
[_]
Mark box at right if an
address change or comments
have been noted on the
reverse side of this card.
Shareholder sign here Co-owner sign here
DETACH CARD DETACH CARD
PRI AUTOMATION, INC.
Dear Shareholder:
Please take note of the important information enclosed with this Proxy Ballot.
There are a number of issues related to the management and operation of your
Company that require your immediate attention and approval. These are discussed
in detail in the enclosed proxy materials.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the boxes on the proxy card to indicate how your shares shall be
voted. Then sign the card, detach it and return your proxy vote in the enclosed
postage paid envelope.
Your vote must be received prior to the Annual Meeting of Stockholders to be
held on February 7, 1997.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
PRI Automation, Inc.
2
