<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. 1)
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 Section 240.14a-11(c) or Section
240.14a-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)(1)
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:
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(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
PRI AUTOMATION, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MARCH 10, 2000
PRI Automation, Inc. hereby gives notice that its annual meeting of
stockholders will be held at the offices of Foley, Hoag & Eliot LLP, One Post
Office Square, Boston, Massachusetts on Friday, March 10, 2000, beginning at
10:00 A.M., local time, for the following purposes:
1. To elect six directors.
2. To consider and act upon a proposal to approve the 2000 Stock Option
Plan.
3. To consider and act upon a proposal to approve the adoption of the 2000
Employee Stock Purchase Plan and an amendment of the 1994 Employee Stock
Purchase Plan to increase the number of shares available for issuance
under the plan from 450,000 to 520,000.
4. To consider and act upon a proposal to approve an amendment to the
articles of organization to increase the number of authorized shares of
common stock from 50,000,000 to 75,000,000 shares.
5. To transact any further business that may properly come before the
annual meeting or any adjournment.
The board of directors has fixed the close of business on January 20, 2000,
as the record date for the determination of PRI stockholders entitled to notice
of, and to vote at, the annual meeting and any adjournment. Only stockholders of
record on such date are entitled to notice of, and to vote at, the annual
meeting or any adjournment.
By Order of the Board of Directors,
Robert L. Birnbaum
CLERK
Billerica, Massachusetts
February 7, 2000
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
(978) 670-4270
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
MARCH 10, 2000
This proxy statement relates to the annual meeting of stockholders of PRI
Automation, Inc. We are mailing the proxy statement and the enclosed form of
proxy to stockholders on or about February 7, 2000. The board of directors is
soliciting proxies to be used at the annual meeting and any adjournments of the
meeting. The annual meeting will be held at the offices of Foley, Hoag & Eliot
LLP, One Post Office Square, Boston, Massachusetts 02109 on Friday, March 10,
2000, beginning at 10:00 a.m. local time.
When proxies are returned properly executed, the persons named in the
proxies will vote the shares represented in accordance with the stockholders'
directions. We encourage stockholders to vote on each matter to be considered.
However, if no choice has been specified by a stockholder in a properly executed
proxy, the persons named as proxies will vote the shares as recommended by
management.
Any stockholder may revoke his proxy at any time before it has been
exercised by:
- providing us with a later dated proxy,
- notifying PRI's Clerk in writing, or
- attending the annual meeting and voting in person.
We have fixed the close of business on January 20, 2000 as the record date
for the annual meeting and any adjournment. Only stockholders of record on the
record date are entitled to notice of, and to vote at, the annual meeting or any
adjournment. At the close of business on the record date, there were issued and
outstanding 22,780,837 shares of common stock, each of which is entitled to cast
one vote. This number includes outstanding exchangeable shares of PRI Automation
(Canada), Inc., each of which entitles its holder to one vote.
QUORUM AND TABULATION OF VOTES
Our by-laws provide that a quorum for the annual meeting requires a majority
in interest of the shares of common stock issued and outstanding and entitled to
vote. We will treat shares of common stock represented by a properly signed and
returned proxy as present at the annual meeting for the purpose of determining a
quorum. In general, votes withheld from any nominee for election as a 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 and votes withheld from director-nominees, including
broker non-votes, will not be included in calculating the number of votes cast.
Each of the proposal to approve the 2000 Stock Option Plan and the proposal
to approve the adoption of the 2000 Employee Stock Purchase Plan and amendment
of the 1994 Employee Stock Purchase Plan requires a majority of the votes
properly cast at the meeting. Nasdaq Stock Market rules require stockholder
approval of each plan. Also, the stockholders must approve each plan in order
for
<PAGE>
stock options and other awards relating to shares issuable under the plan to
qualify for favorable tax treatment under the Internal Revenue Code. Abstentions
with respect to these proposals will count as being present and represented and
entitled to vote, and will be included in calculating the number of votes cast.
Abstentions will therefore have the effect of a "no" vote. Broker non-votes will
not be included in calculating the number of votes cast on these proposals.
The proposal to amend the articles of organization requires the approval of
a majority of PRI's issued and outstanding voting stock. Abstentions and broker
non-votes have the effect of a "no" vote on this proposal.
The persons named in the proxies will vote the shares FOR election of each
nominee as a director and FOR each other proposal if no specification is made.
We know of no other matter to be presented at the annual meeting. If any
other matter should be presented at the annual meeting upon which a vote
properly may be taken, shares represented by all proxies we receive will be
voted with respect thereto in accordance with the best judgment of the persons
named in the proxies.
EquiServe, L.P., our transfer agent, will tabulate votes at the annual
meeting.
PROPOSAL ONE--
ELECTION OF DIRECTORS
Our by-laws provide for a board of directors, the number of which is fixed
from time to time by the stockholders and may be enlarged or reduced by vote of
a majority of the board. The board has fixed the number of directors at six and
has nominated for election as directors Mordechai Wiesler, Mitchell G. Tyson,
Amram Rasiel, Boruch B. Frusztajer, Alexander V. d'Arbeloff, and Kenneth M.
Thompson. Each nominee is currently a director of PRI. 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 we have 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 of directors.
THE BOARD RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF EACH OF THE SIX
INDIVIDUALS NAMED ABOVE AS DIRECTORS.
PROPOSAL TWO--
2000 STOCK OPTION PLAN
The board of directors has adopted the 2000 Stock Option Plan, subject to
approval by the stockholders. The board of directors authorized a total of
400,000 shares that may be issued pursuant to awards granted under the plan.
Options constitute a significant portion of the overall compensation of our
employees, including our executive officers. The board of directors, including
the members of the Compensation Committee, believes that PRI will derive
substantial benefits from the 2000 Stock Option Plan. We believe that the 2000
Stock Option Plan will help attract and retain key executives by enabling us to
offer competitive compensation packages. We also believe that equity
compensation benefits PRI by aligning the interests of directors, executive
officers and other employees with the interests of the stockholders.
The full text of the 2000 Stock Option Plan as adopted by the board of
directors is printed as Appendix A, beginning on page A-1. A summary of its
material provisions is set forth hereinafter under the caption "Benefit Plans."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL
TO APPROVE THE 2000 STOCK OPTION PLAN.
2
<PAGE>
PROPOSAL THREE--
ADOPTION OF 2000 EMPLOYEE STOCK PURCHASE PLAN AND
AMENDMENT OF 1994 EMPLOYEE STOCK PURCHASE PLAN
The board of directors has adopted the 2000 Employee Stock Purchase Plan,
subject to approval by the stockholders. The plan provides for the sale and
issuance of up to 350,000 shares pursuant to awards granted under the plan. The
plan allows all eligible employees of PRI to purchase shares of common stock by
electing to have a percentage of their pay deducted for a six-month offering
period. It is intended to replace the 1994 Employee Stock Purchase Plan, which
has been in place since 1994.
The board of directors also amended the 1994 Employee Stock Purchase Plan to
increase by 70,000 the number of shares available for issuance thereunder. The
increase is to ensure that PRI will have sufficient shares available for all
employees who have elected to purchase shares in the current, and final,
offering period under the plan. This amendment does not require, and is not
contingent upon, stockholder approval. We are requesting that stockholders
approve this amendment solely so that the plan will continue to be qualified
under Section 423 of the Internal Revenue Code, which provides favorable tax
treatment to employees with respect to shares purchased under the plan.
We are proposing adoption of the 2000 Employee Stock Purchase Plan because
the 1994 Employee Stock Purchase Plan will expire at the end of the current
offering period. We want to retain this broad-based equity compensation measure
as an important component of our overall compensation package. The board of
directors believes that the opportunity to purchase common stock under an
employee stock purchase plan is an important benefit to our employees. We
believe that PRI has derived substantial benefits from the 1994 Employee Stock
Purchase Plan, and will continue to derive these benefits from the new plan.
Offering employees the opportunity to purchase common stock allows us to more
closely align the interests of our employees with the interests of our
stockholders and helps us attract and retain key employees. We believe that such
plans are a common feature of employee compensation in our industry, especially
among companies with whom we compete for employees.
We intend to file, as soon as practicable after stockholder approval of the
proposal, a registration statement under the Securities Act of 1933 covering the
shares of common stock issuable under the plans.
The full text of the 2000 Employee Stock Purchase Plan as adopted by the
board of directors is printed as Appendix B, beginning on page B-1. The full
text of the 1994 Employee Stock Purchase Plan, as amended, is printed as
Appendix C, beginning on page C-1. A summary of material provisions of the plans
is set forth hereinafter under the caption "Benefit Plans."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR THE PROPOSAL
TO APPROVE THE 2000 EMPLOYEE STOCK PURCHASE PLAN AND THE AMENDED 1994 EMPLOYEE
STOCK PURCHASE PLAN.
3
<PAGE>
PROPOSAL FOUR--
AMENDMENT OF THE ARTICLES OF ORGANIZATION
The board of directors has voted to recommend to the stockholders that PRI
amend its articles of organization to increase the number of authorized shares
of common stock from 50,000,000 to 75,000,000 shares.
As of January 20, 2000, there were 22,780,837 shares issued and outstanding
and approximately 4,554,634 shares reserved for future issuance pursuant to
outstanding options to purchase common stock. Additional authorized and unissued
shares of common stock may be issued from time to time by vote of the board of
directors for such corporate purposes as it determines to be necessary or
desirable, including:
- stock splits and stock dividends;
- raising capital through the sale of stock; and
- acquiring businesses through the exchange of stock.
The number of authorized and unissued shares now available limits our
ability to pursue certain strategic options. For example, we presently have too
few shares available to effect a stock split, even if the board determined that
a split would be a desirable corporate action. We presently have no commitments
or agreements to effect a stock split, or to issue any additional shares of
common stock except pursuant to outstanding options. However, the board of
directors considers the authorization of additional shares of common stock
advisable to ensure prompt availability of shares should an appropriate occasion
arise.
Without this authorization, we would generally have to incur the delay and
expense of a meeting of stockholders and proxy solicitation to authorize the
issuance of stock for specific transactions. Of course, Massachusetts law,
Nasdaq rules, or our by-laws or articles of organization may still require a
vote of stockholders for certain transactions, for example, a large acquisition.
If authorized, the additional shares of common stock would have the same
rights and privileges as the currently outstanding shares of common stock. The
increase in authorized shares will not affect the terms, or the rights of the
holders, of outstanding shares of common stock.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE
PROPOSAL TO AMEND THE ARTICLES OF ORGANIZATION.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning each director
(each of whom has been nominated for re-election) and each executive officer of
PRI:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- -------- --------
<S> <C> <C>
Mordechai Wiesler...................... 69 Chairman of the Board of Directors
Mitchell G. Tyson...................... 45 President, Chief Executive Officer and Director
Stephen D. Allison..................... 54 Chief Financial Officer
Robert G. Postle....................... 45 Vice President, General Manager, Factory Systems
Division
Edward A. Wagner....................... 51 Vice President, General Manager, OEM Systems Division
Amram Rasiel (2)....................... 69 Director
Boruch B. Frusztajer (2)(3)............ 69 Director
Alexander V. d'Arbeloff (3)............ 72 Director
Kenneth M. Thompson.................... 61 Director
</TABLE>
- ------------------------
(1) Mr. Allison has resigned effective January 28, 2000.
(2) Member of the Audit Committee.
(3) Member of the Compensation Committee.
4
<PAGE>
MORDECHAI WIESLER, a founder of PRI, has been a director of PRI since our
inception. Mr Wiesler served as PRI's President from our inception until
February 1995, as Chief Executive Officer from our inception until August 1998
and as Treasurer from our inception until September 1999. Mr. Wiesler was also
the founder, president and chairman of Transistor Automation Corporation until
its sale to Teledyne, Inc. in 1966. Mr Wiesler received a B.S. in mechanical
engineering from the Technion in Israel.
MITCHELL G. TYSON was named Chief Executive Officer of PRI in August 1998.
He was elected to the office of President and named a director of PRI in 1995.
Mr. Tyson served as our Chief Operating Officer from 1990 to 1998. From 1987 to
1990, he served as our Vice President, Operations. From 1984 to 1987, Mr. Tyson
was the director of product management of GCA Corporation, a manufacturer of
semiconductor capital equipment. Mr. Tyson holds a B.S. in physics, an M.S. in
political science and an M.S. in nuclear engineering, all from the Massachusetts
Institute of Technology. Mr. Tyson is a member of the board of directors of the
Semiconductor Industry Suppliers of North America (formerly SEMI-SEMATECH,
Inc.). In addition, Mr. Tyson is a member of the North American Advisory Board
of SEMI, a trade association that represents the worldwide semiconductor
equipment industry.
STEPHEN D. ALLISON joined us in 1997 and served as our Chief Financial
Officer until January 28, 2000. Mr. Allison was Vice President and Chief
Financial Officer of Helix Technology Corporation, a manufacturer of cryogenic
vacuum systems, from 1995 to 1997. Mr. Allison also served as Vice President,
Finance of Behring Diagnostic Systems, Inc., a supplier of immunoassay test and
analysis systems, from 1991 to 1995, served as Vice President, Planning of Bay
State Health Care, Inc., from 1989 to 1991 and worked at Teradyne, Inc. in
various financial positions from 1974 to 1989. Mr. Allison holds a B.A. in
economics from Columbia Univeristy and an M.B.A from the Amos Tuck School of
Business Administration at Dartmouth College, and is a Certified Public
Accountant.
ROBERT G. POSTLE was named our Vice President, General Manager, Factory
Systems Division in September 1999. Mr. Postle joined PRI in 1994 as Vice
President, Marketing and Sales, became Vice President, Marketing, Sales and
Service in 1997 and was named Vice President, Sales, Service and Field
Operations in 1998. 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. Mr. Postle holds a B.S. in business administration from the State
University of New York, Brockport.
EDWARD A. WAGNER was appointed our Vice President, General Manager, OEM
Systems Division in January 1999. Mr. Wagner joined PRI as Vice President, Sales
in 1997. From 1989 to 1997, Mr. Wagner was Vice President of US operations for
Metron Technology, a worldwide sales and distribution company supporting many of
the major semiconductor equipment manufacturers in both the US and Japan. From
1979 to 1989, he served as President and General Manager of BGL Corp., a
manufacturer of OEM automation products and quartz glass products. Mr. Wagner
holds a B.S. from the University of California at Berkeley and an M.B.A. from
Golden Gate University, San Francisco.
AMRAM RASIEL has been a director of PRI since 1982. Dr. Rasiel is a private
investor. He is a director of Progress Software Corporation, a provider of
application development software, and of a number of privately held companies.
BORUCH B. FRUSZTAJER became a director of PRI in 1982. Mr. Frusztajer has
been the President of BBF Corporation, an industrial management company, since
1984.
ALEXANDER V. D'ARBELOFF became a director of PRI in 1982. Mr. d'Arbeloff has
been Chairman of the Board of Teradyne, Inc., a publicly-held manufacturer of
automatic testing equipment used in the manufacture of semiconductors, since
1977. From 1971 to 1996, Mr. d'Arbeloff served as President of Teradyne, and
also served as its Chief Executive Officer from 1971 to 1997. He is Chairman of
the
5
<PAGE>
Corporation of the Massachusetts Institute of Technology. Mr. d'Arbeloff is a
director of a number of privately held companies.
KENNETH M. THOMPSON became a director of PRI in July 1998. Mr. Thompson was
employed by Intel Corporation for twenty-five years, most recently as Vice
President, Technology Manufacturing Engineering. He retired from Intel in 1998.
Mr. Thompson is a director of LAM Research Corp., Silicon Valley Group, Inc. and
Gasonics Corporation.
COMMITTEES AND MEETINGS OF THE BOARD
During the fiscal year ended September 30, 1999 ("fiscal 1999"), the Board
met six times, acted three times by unanimous written consent and acted once
through an ad hoc committee of three directors appointed by the full board. No
director attended fewer than 75% of the total number of meetings held by the
Board or committees of the Board on which he served.
The board of directors currently has two standing committees. The Audit
Committee (currently composed of Messrs. Rasiel and Frusztajer) reviews PRI's
internal accounting procedures and consults with and reviews the services
provided by PRI's independent auditors. The Audit Committee met once during
fiscal 1999. The Compensation Committee (currently composed of
Messrs. Frusztajer and d'Arbeloff) has general responsibility for PRI's
executive compensation policies and practices, including making specific
recommendations to the board of directors concerning compensation for PRI's
executive officers and administering the 1984 Incentive Stock Option Plan, the
1994 Incentive and Nonqualified Stock Option Plan, the 1994 Employee Stock
Purchase Plan and the 1997 Non-Incentive Stock Option Plan. The Compensation
Committee acted by written consent three times during fiscal 1999.
REMUNERATION OF EXECUTIVE OFFICERS AND DIRECTORS
DIRECTORS' COMPENSATION
Each non-employee director of PRI 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 PRI employees are not paid any
separate fees for serving as directors. On November 30 of each year, each
non-employee director then in office is automatically granted a non-qualified
option under the 1997 Stock Option Plan to purchase 5,000 shares of common stock
at an exercise price equal to its fair market value on that date. Pursuant to
this provision of the 1997 Stock Option Plan, on November 30, 1998, each of
Messrs. Rasiel, Frusztajer, d'Arbeloff and Thompson was automatically granted a
nonstatutory option to purchase 5,000 shares of common stock at an exercise
price of $24.00 per share.
EXECUTIVE COMPENSATION
The following table provides certain summary information concerning the
compensation earned by PRI's Chief Executive Officer and each of the four other
most highly compensated executive officers, as well as a former officer
(collectively, the "Named Executive Officers"), for services rendered in all
capacities to PRI during fiscal 1999 and during the fiscal years ended
September 30, 1997 and 1998 ("fiscal 1997" and "fiscal 1998," respectively).
6
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------
AWARDS
ANNUAL ------------
COMPENSATION(1) SECURITIES ALL OTHER
NAME AND FISCAL -------------------- UNDERLYING COMPENSATION
PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS(#) ($)(2)
------------------ -------- --------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Mordechai Wiesler........................... 1999 $201,539 -- 40,000 $12,360
Chairman of the Board 1998 $257,212 -- 30,000 $10,485
1997 $243,077 $187,500 40,000 $11,500
Mitchell G. Tyson........................... 1999 $266,010 -- 55,000 $ 5,412
President and Chief Executive Officer 1998 $247,289 -- 130,000 $ 5,363
1997 $218,077 $168,750 40,000 $ 5,260
Robert G. Postle............................ 1999 $207,038 -- 61,000 $ 5,412
Vice President, General Manager, Factory 1998 $196,789 -- 25,500 $ 5,667
Systems Division 1997 $155,847 $100,000 25,000 $ 5,180
Stephen D. Allison(3)....................... 1999 $202,596 -- 26,000 $ 3,754
Chief Financial Officer 1998 $194,789 -- 47,000 $ 2,936
1997 $ 84,135 $ 35,096 30,000 $ 1,512
Edward A. Wagner(4)......................... 1999 $204,346 -- 39,000 $ 6,528
Vice President, General Manager, 1998 $164,237 -- 45,500 $ 5,362
OEM Systems Division 1997 $ 34,303 $ 52,000 22,500 $ 518
Robert Klimm(3)............................. 1999 $229,260 -- 39,000 $ 6,157
Former Vice President, General Manager 1998 $216,231 -- 18,000 $ 7,106
Factory Systems Division 1997 $100,010 $ 52,055 40,000 $ 1,764
</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 $50,000 and less than ten percent of the total annual
salary and bonus for each executive officer.
(2) The amounts reported include PRI's contributions to the PRI Savings and
Retirement Plan during fiscal 1999, fiscal 1998 and fiscal 1997,
respectively, for the benefit of Mr. Wiesler ($4,800, $4,185 and $5,200),
Mr. Tyson ($4,800, $4904 and $4,973), Mr. Postle ($4,800, $5,310 and $3,629)
and Mr. Allison ($2,026, $1,928 and $1,410) and during fiscal 1999 and
fiscal 1998 for Mr. Wagner ($4,800 and $4,927); and premiums paid by PRI on
excess life insurance policies during fiscal 1999, fiscal 1998 and fiscal
1997, respectively, for Mr. Wiesler ($7,560, $6,300 and $6,300), Mr. Tyson
($612, $459 and $510), Mr. Postle ($612, $357 and $505) and Mr. Allison
($1,728, $1,008 and $102) and during fiscal 1999 and fiscal 1998 for
Mr. Wagner ($1,728 and $435).
(3) Messrs. Allison and Klimm joined PRI during fiscal 1997 and, therefore,
received compensation for only a portion of that fiscal year.
(4) Mr. Wagner joined PRI as Vice President, Sales in June 1997 and, therefore,
received compensation for only a portion of that fiscal year. He became Vice
President, General Manager, OEM Systems Division in March 1999.
7
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table contains information concerning stock option grants made
during fiscal 1999 under the 1994 Incentive and Nonqualified Stock Option Plan
and the 1997 Nonqualified Stock Option Plan to the Chief Executive Officer and
each of the other Named Executive Officers:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK
% OF TOTAL PRICE APPRECIATION
OPTIONS FOR
GRANTED TO EXERCISE OR OPTION TERM(2)
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION ---------------------
NAME GRANTED(#) FISCAL YEAR ($/SHARE)(1) DATE 5%($) 10% ($)
- ---- ---------- ------------ ------------ ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Mordechai Wiesler...................... 30,000(3) 1.8 0.6 $27.375 3/03/05 $279,304 $633,644
10,000(4) $23.3125 5/11/05 $ 79,285 $179,870
Mitchell G. Tyson...................... 40,000(3) 2.4 0.9 $27.375 3/03/05 $372,405 $844,859
15,000(4) $23.3125 5/11/05 $118,927 $269,805
Robert G. Postle....................... 27,000(3) 1.6 0.5 1.5 $27.375 3/03/05 $251,373 $570,280
9,000(4) $23.3125 5/11/05 $ 71,356 $161,883
25,000(5) $28.625 8/31/05 $243,381 $552,148
Stephen D. Allison..................... 20,000(3) 1.2 0.4 $27.375 3/03/05 $186,202 $422,430
6,000(4) $23.3125 5/11/05 $ 47,571 $107,922
Edward A. Wagner....................... 30,000(6) 1.8 0.5 $27.00 1/04/05 $275,477 $624,964
9,000(4) $23.3125 5/11/05 $ 71,356 $161,883
Robert Klimm........................... 30,000(3) 1.8 $27.375 3/03/05 $279,304 $633,644
9,000(4) 0.5 $23.3125 5/11/05 $ 71,356 $161,883
</TABLE>
- --------------------------
(1) All options were granted at exercise prices not less than fair market value,
which was determined by the board of directors to be the last sale price of
the common stock on the date of grant as reported by the Nasdaq Stock
Market.
(2) 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
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 PRI'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 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
Named Executive Officers. This table does not take into account any
appreciation in price of the common stock from the date of grant to the
current date. The values shown are net of the option price, but do not
include deductions for taxes or other expenses associated with the exercise.
(3) Option vests in twenty equal quarterly installments beginning June 30, 1999
and ending March 3, 2004.
(4) Fully vested on December 5, 1999.
(5) Option issued in connection with Mr. Postle's promotion to the position of
Vice President, General Manager, Factory Systems Division. Option vests in
twenty equal quarterly installments beginning November 30, 1999 and ending
August 31, 2004.
(6) Option issued in connection with Mr. Wagner's promotion to the position of
Vice President, General Manager, OEM Systems Division. Option vests in
twenty equal quarterly installments beginning April 4, 1999 and ending
January 4, 2004.
8
<PAGE>
OPTION/SAR EXERCISES AND FISCAL YEAR-END VALUES
The following table sets forth information concerning option exercises and
holdings under PRI's 1984 Incentive Stock Option Plan, 1994 Incentive and
Nonqualified Stock Option Plan and 1997 Non-Incentive Stock Option Plan as of
September 30, 1999 with respect to the Chief Executive Officer and the other
Named Executive Officers:
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
COMMON STOCK
UNDERLYING VALUE OF UNEXERCISED
SHARES UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
ACQUIRED VALUE FISCAL YEAR-END (#) FISCAL YEAR-END $(2)
ON REALIZED --------------------------- ---------------------------
NAME EXERCISE(#) ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ---------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mordechai Wiesler................. 75,000 $1,820,473 77,051 86,349 $1,757,298 $1,383,078
Mitchell G. Tyson................. 95,000 $2,369,375 157,951 182,469 $4,153,149 $3,561,915
Robert G. Postle.................. 32,420 $ 476,868 7,187 90,951 $ 190,320 $1,186,378
Stephen D. Allison................ -- -- 15,401 57,599 $ 320,821 $ 952,554
Edward A. Wagner.................. 9,501 $ 176,572 3,000 61,999 $ 74,250 $ 917,416
Robert Klimm...................... 27,400 $ 418,381 2,000 67,600 $ 49,500 $ 855,138
</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 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 common stock at the time of such sale.
(2) Calculated on the basis of the last sale price of the common stock on
September 30, 1999 as reported by the Nasdaq Stock Market ($36.125 per
share), less the applicable option exercise price.
RETENTION AND SEVERANCE AGREEMENTS
PRI has entered into retention agreements with each of Messrs. Wiesler,
Tyson, Postle, Allison and Wagner. The terms of each agreement were amended in
fiscal 1999. The agreements provide for certain payments upon the occurrence of
certain events following a "change of control" of PRI. A "change of control" is
defined in each agreement to mean (i) any person becoming the beneficial owner
of securities of PRI representing fifty percent (50%) or more of the total
voting power; (ii) a change in the composition of the board of directors
creating a majority of directors consisting of individuals other than directors
of PRI as of the date of the retention agreement or their designated successors;
or (iii) the merger or consolidation of PRI with any other corporation (other
than a merger or consolidation keeping at least fifty percent (50%) of the total
voting power in the hands of PRI stockholders) or PRI's liquidation or the sale
or disposition by PRI of all or substantially all of its assets.
Each agreement provides that PRI will pay certain severance benefits to the
executive officer in the event that, within 12 months after a change of control,
the executive's employment is terminated other than for cause, as defined in the
agreement, or if the executive resigns after the occurrence of one or more
certain events, such as material reduction in responsibilities or salary or
relocation to a facility in a different location without the executive's
consent.
Each agreement provides that, if the executive is terminated or resigns
within 12 months after a change of control under circumstances that would
entitle the executive to severance benefits, then PRI will be obligated to pay
to the executive, in a single payment, an amount equal to the sum of (a) his
then-current annual base compensation, (b) the bonus (if any) that PRI (or its
successor) paid the executive with respect to its fiscal year most recently
ended before such termination or resignation and (c) a prorated fraction of the
amount of his "target bonus" for the fiscal year of PRI in which the
9
<PAGE>
termination or resignation occurs. Each agreement further provides that, upon
such termination or resignation, or upon the first anniversary of a change of
control if no such termination or resignation occurs, 100% of the otherwise
unvested portion of each stock option held by the executive will become fully
exercisable, and 100% of each option held by PRI to repurchase stock of PRI
owned by the executive will terminate.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee is a former or current employee of
PRI 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. Boruch B.
Frusztajer and Alexander V. d'Arbeloff, two non-employee members of the Board of
Directors, are the 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. PRI 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, PRI 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. PRI also understands the need to provide long term incentives to its
executive officers to achieve future financial and strategic goals which include
PRI's growth, enhancement of PRI's profitability and thus shareholder value. PRI
believes that its total compensation is sufficiently competitive to retain and,
if necessary, attract executive officers capable of leading PRI in accomplishing
its business goals.
Executive compensation for fiscal 1999 consisted of a base salary and
equity-based long-term incentive compensation in the form of incentive and
nonstatutory stock options. Since options granted under the 1994 Incentive and
Nonqualified Stock Option Plan and 1997 Nonqualified Stock Option Plan generally
vest over a five-year period, option awards encourage the holders to improve the
profitability and shareholder value of PRI. Also, to reward performance PRI
provides executives with additional cash compensation in the form of profit
sharing bonuses. However, no bonus compensation was awarded in fiscal 1999.
BASE SALARIES AND CHIEF EXECUTIVE OFFICER COMPENSATION. The salaries of the
executive officers are established annually by evaluating requirements of the
position, the contribution of the individual executive with respect to PRI's
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 PRI's
executive compensation is in a competitive range for executives within PRI's
industry. The salary of Mitch Tyson, PRI's Chief Executive Officer, was $266,010
for fiscal 1999. This represented an increase of approximately 7.6% from fiscal
1998.
LONG-TERM INCENTIVE COMPENSATION. One of PRI's goals 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. PRI's stock
option plans are long-term plans 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. In fiscal 1999, PRI granted long-term
incentive compensation in the form of incentive and nonstatutory stock options
under the 1994 Incentive and Nonqualified Stock Option Plan and 1997
Nonqualified Stock Option Plan to PRI's executive officers. These grants
included options granted to Messrs. Wiesler, Tyson, Postle, Allison and Wagner
to purchase up to 40,000, 55,000, 61,000, 26,000 and 39,000 shares of common
stock, respectively. See "Option Grants in Last Fiscal Year" at page 8.
Boruch B. Frusztajer
Alexander V. d'Arbeloff
10
<PAGE>
BENEFIT PLANS
EMPLOYEE STOCK PURCHASE PLANS
On November 30, 1999, the board of directors voted to adopt the PRI
Automation, Inc. 2000 Employee Stock Purchase Plan, under which options to
purchase up to 350,000 shares of common stock may be granted to employees of
PRI, and to amend to the 1994 Employee Stock Purchase Plan to increase the total
number of shares available for issuance under the plan from 450,000 to 520,000.
The board of directors initially adopted, and the stockholders approved, the
1994 Employee Stock Purchase Plan in 1994. The 1994 Employee Stock Purchase Plan
will terminate after the current offering period ends on March 31, 2000. The
board of directors intends that the 2000 Employee Stock Purchase Plan will
replace the 1994 Employee Stock Purchase Plan as a component of PRI's employee
compensation.
Each of the employee stock purchase plans is intended to provide a method of
broad-based equity compensation whereby employees of PRI will have an
opportunity to acquire an ownership interest (or increase an existing ownership
interest) in PRI through the purchase of shares of common stock. PRI intends
that each employee stock purchase plan will qualify as an "employee stock
purchase plan" under Section 423 of the Internal Revenue Code. The provisions of
the employee stock purchase plans shall, accordingly, be construed so as to
extend and limit participation in a manner consistent with the requirements of
that section of the Code.
Eligible employees will have the right to purchase stock under the 2000
Employee Stock Purchase Plan in a series of six-month offerings. The
Compensation Committee will, in its discretion, determine the applicable
commencement and termination dates for each offering. An employee may
participate in any one or more of the offerings without being prohibited from or
required to participate in any other offering.
During each six-month offering period under the 2000 Employee Stock Purchase
Plan, participating employees will be entitled to purchase shares through
payroll deductions. An eligible employee can elect to have 1% to 10% of the
employee's base pay over the offering period. During each offering period, the
price at which the employee will be able to purchase the common stock will be
85% of the last reported sale price of the common stock on the Nasdaq Stock
Market on the date that the offering period commences or the date the offering
period concludes, whichever is lower.
All employees who are customarily employed for twenty or more hours per week
and five months per calendar year, and are employed by PRI on the first day of
the applicable offering period, will be eligible to participate in the employee
stock purchase plans. No employee will be able to purchase shares pursuant to
the employee stock purchase plans, if after such purchase, such employee would
own 5% or more of the total combined voting power or value of PRI's stock. The
employee stock purchase plans are administered by the board of directors.
No employee will be granted an option under either employee stock purchase
plan that would permit the employee's rights to purchase common stock to accrue
at a rate in excess of $25,000 in fair market value of common stock, when the
option is granted, for each calendar year in which the option is outstanding at
any time. Additionally, no employee may purchase more than 1,000 shares during
any offering period under the 2000 Employee Stock Purchase Plan.
NEW PLAN BENEFITS
Eligible employees can elect to participate in PRI's employee stock purchase
plans by authorizing deductions from their paychecks during any six-month
offering. Each participating employee may elect to have withheld any amount up
to 10% of the employee's salary. Therefore, PRI is unable to determine the
dollar value and number of options which will be received by or allocated to any
11
<PAGE>
participating employee if the proposal relating to the employee stock purchase
plans is approved. Non-employee directors are not eligible to participate in the
employee stock purchase plans.
AMENDMENT OF THE EMPLOYEE STOCK PURCHASE PLANS
The board of directors may terminate or amend the 1994 Employee Stock
Purchase Plan or the 2000 Employee Stock Purchase Plan at any time. Termination
of either plan would not affect options previously granted, nor can an amendment
make any change in any option theretofore granted if the change would adversely
affect the rights of any participant with respect to outstanding options.
UNITED STATES INCOME TAX INFORMATION
The following discussion is intended only as a brief overview of certain of
the current federal income tax laws applicable to the 2000 Employee Stock
Purchase Plan. Employees should consult their tax advisors concerning their own
federal income tax situations, as well as concerning state tax aspects of the
acquisition of shares of Common Stock pursuant to the Stock Purchase Plan. No
state tax matters are addressed in the following discussion.
If an employee acquires shares under the 2000 Employee Stock Purchase Plan
and does not dispose of them within two years after the commencement of the
offering pursuant to which the shares were acquired, nor within one year after
the date on which the shares were acquired, any gain realized upon subsequent
disposition will be taxable as a long-term capital gain, except that the portion
of such gain equal to the lesser of (a) the excess of the fair market value of
the shares on the date of disposition over the amount paid upon purchase of the
shares, or (b) the excess of the fair market value of the shares on the offering
commencement date over the amount paid upon purchase of the shares, is taxable
as ordinary income. There is no corresponding deduction for PRI, however. If the
employee disposes of the shares at a price less than the price at which he or
she acquired the shares, the employee realizes no ordinary income and has a
long-term capital loss measured by the difference between the purchase price and
the selling price.
If an employee disposes of shares acquired pursuant to the 2000 Employee
Stock Purchase Plan within two years after the commencement date of the offering
pursuant to which the shares were acquired, or within one year after the date on
which the shares were acquired, the difference between the purchase price and
the fair market value of the shares at the time of purchase will be taxable to
him or her as ordinary income in the year of disposition. In this event, PRI may
deduct from its gross income an amount equal to the amount treated as ordinary
income to each such employee. Any excess of the selling price over the fair
market value at the time the employee purchased the shares will be taxable as
long-term or short-term capital gain, depending upon the period for which the
shares were held. If any shares are disposed of within either the two-year or
one-year period at a price less than the fair market value at the time of
purchase, the same amount of ordinary income (i.e., the difference between the
purchase price and the fair market value of the shares at the time of purchase)
is realized, and a capital loss is recognized equal to the difference between
the fair market value of the shares at the time of purchase and the selling
price.
If a participating employee should die while owning shares acquired under
the 2000 Employee Stock Purchase Plan, ordinary income may be reportable on his
or her final income tax return.
The 2000 Employee Stock Purchase Plan is not subject to the provisions of
the Employee Retirement Income Security Act of 1974, nor is the plan qualified
under Section 401(a) of the Code.
12
<PAGE>
2000 STOCK OPTION PLAN
On November 30, 1999, the board of directors approved the 2000 Stock Option
Plan. The 2000 Stock Option Plan authorizes:
- the grant of options to purchase common stock intended to qualify as
incentive stock options, as defined in Section 422 of the Internal Revenue
Code; and
- the grant of options that do not so qualify, or nonstatutory options.
NUMBER OF SHARES AVAILABLE FOR OPTION AWARDS UNDER THE 2000 STOCK OPTION
PLAN
The 2000 Stock Option Plan provides that an aggregate of 400,000 shares of
common stock (subject to adjustment upon certain changes in capitalization of
PRI) may be issued pursuant to options granted thereunder. As of January 20,
2000, all of these shares remained available for awards under the 2000 Stock
Option Plan. Also, the 2000 Stock Option Plan provides that up to a maximum of
600,000 shares not required to be reserved for issuance upon exercise of options
granted under PRI's 1994 Incentive and Non-Qualified Stock Option Plan will be
added to the shares reserved under the 2000 Stock Option Plan.
PRI intends to file, as soon as practicable, a Registration Statement on
Form S-8 under the Securities Act of 1933 covering the shares of common stock
issuable under the 2000 Stock Option Plan.
OPTION AWARDS UNDER THE 2000 STOCK OPTION PLAN
Incentive stock options may be granted under the 2000 Stock Option Plan to
employees, including officers and directors who are also employees. Nonstatutory
options may be granted under the 2000 Stock Option Plan to employees, officers,
individuals providing services to PRI and directors, whether or not they are
employees of PRI.
No options awarded under the 2000 Stock Option Plan 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 PRI or any subsidiary or parent). The exercise price for incentive
stock 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). Options may become exercisable in
periodic installments or upon other terms and conditions as the Compensation
Committee may deem appropriate. The aggregate fair market value (determined at
the time of grant) of shares issuable pursuant to incentive stock options which
first become exercisable by an employee or officer in any calendar year may not
exceed $100,000. Also, no individual may be granted options to purchase more
than 300,000 shares in any calendar year.
Incentive stock options are non-transferable except by will or by the laws
of descent or distribution, and are exercisable during the lifetime of the
person to whom the incentive stock option was granted only by the grantee.
Nonstatutory options may be transferred upon such terms and conditions as are
set forth in the option agreement, as the Compensation Committee may determine
in its discretion. Options generally may not be exercised after (i) termination
by PRI for cause of an optionee's employment with PRI, (ii) thirty days
following termination by PRI without cause or voluntary termination by the
optionee of the optionee's employment with PRI, or (iii) one year following
termination of an optionee's employment because of disability, death or
retirement.
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) at the discretion of
the Committee, (A) shares of common stock held for at least six months and
having a fair market value equal to the option price of such shares,
(B) according to a deferred payment or other arrangement with the person
exercising the option, or (C) any other form of
13
<PAGE>
other legal consideration acceptable to the Committee including a full-recourse
note on terms determined by the Compensation Committee. Full payment for shares
exercised must be made at the time of exercise.
ADMINISTRATION OF THE 2000 STOCK OPTION PLAN
The 2000 Stock Option Plan is administered by the Compensation Committee.
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 2000 Stock Option Plan. Also, under the 2000 Stock Option Plan
the Compensation Committee may delegate to a committee consisting of one or more
PRI officers the authority to grant options under the 2000 Stock Option Plan to
eligible persons who are not subject to Section 16 of the Securities Exchange
Act. The board of directors has appointed Mitchell Tyson, PRI's President and
Chief Executive Officer, to serve in this capacity.
FEDERAL INCOME TAX INFORMATION WITH RESPECT TO THE 2000 STOCK OPTION PLAN
The grantee of a nonstatutory option under the 2000 Stock Option Plan
recognizes no income for federal income tax purposes on the grant thereof. On
the exercise of a nonstatutory 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, PRI 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
nonstatutory option.
The grantee of an incentive stock option under the 2000 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 stock option. If no disposition of shares
acquired upon exercise of the incentive stock option is made by the option
holder within two years from the date of the grant of the incentive stock option
or within one year after exercise of the incentive stock 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 stock 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 stock 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 stock
options, under the 2000 Stock Option Plan, PRI 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 stock option within two years of the date of the granting of the
incentive stock option or one year after the exercise of the incentive stock
option), subject to certain limitations on the deductibility of compensation
paid to executives.
14
<PAGE>
NEW PLAN BENEFITS
The Compensation Committee may grant options under the 2000 Stock Option
Plan on a discretionary basis. In reviewing and making option grants, the
Compensation Committee considers, among other factors, the individual
performance of the recipient. Therefore, PRI is unable to determine the dollar
value and number of options which will be received by or allocated to any
eligible participant, or that would have been received by or allocated to any
eligible participant had the 2000 Stock Option Plan been in effect during fiscal
1999.
AMENDMENT OF 2000 STOCK OPTION PLAN
The board of directors may amend the 2000 Stock Option Plan at any time. No
amendment will be effective without the approval of PRI's stockholders, to the
extent stockholder approval is necessary to satisfy the requirements of the
Nasdaq Stock Market. The board of directors may, in its discretion, submit other
proposed amendments for stockholder approval. Specifically, the board of
directors may amend the 2000 Stock Option Plan in any respect the board deems
necessary or advisable to provide participants with the maximum benefits
available under the Internal Revenue Code relating to incentive stock options.
CERTAIN TRANSACTIONS
In August 1998, PRI entered into a loan arrangement with Robert Postle, then
our Vice President, Sales, Service and Field Operations and now our Vice
President, General Manager, Factory Systems Division. PRI loaned Mr. Postle
$150,000 pursuant to a three-year promissory note with interest accruing at 6%.
The note was secured by a mortgage on Mr. Postle's residence. The outstanding
principal under the note, together with accrued interest thereon, was due and
payable at the maturity date or upon the earlier termination of Mr. Postle's
employment either by PRI for cause or voluntarily by Mr. Postle. This note,
together with all accrued interest, was repaid in full in January 2000.
15
<PAGE>
PERFORMANCE GRAPH
The following performance graph compares the performance of PRI'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
common stock and for the market and industry indices are calculated assuming
that $100 was invested on October 13, 1994, the date on which the common stock
commenced trading on the National Market System of the Nasdaq Stock Market. PRI
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.
PRI AUTOMATION INC. CUMULATIVE TOTAL RETURNS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
PRI AUTOMATION NASDAQ STOCK MARKET -U.S. H&Q SEMICONDUCTOR SECTOR
<S> <C> <C> <C>
10/13/1994 100.00 100.00 100.00
Oct-94 112.96 101.45 109.51
Nov-94 124.07 98.09 106.94
Dec-94 119.44 98.36 106.95
Jan-95 118.52 98.92 108.71
Feb-95 133.33 104.15 122.14
Mar-95 164.81 107.24 129.15
Apr-95 194.44 110.62 147.43
May-95 209.26 113.47 159.60
Jun-95 242.59 122.67 181.26
Jul-95 303.70 131.69 206.77
Aug-95 279.63 134.36 202.91
Sep-95 303.70 137.44 204.85
Oct-95 274.07 136.65 192.49
Nov-95 303.70 139.86 170.34
Dec-95 260.19 139.12 148.84
Jan-96 211.11 139.80 146.82
Feb-96 176.85 145.12 147.57
Mar-96 181.48 145.60 140.57
Apr-96 209.26 157.67 161.05
May-96 295.37 164.91 156.06
Jun-96 225.93 157.48 134.72
Jul-96 194.44 143.44 119.60
Aug-96 216.67 151.47 130.90
Sep-96 242.59 163.06 152.94
Oct-96 262.96 161.26 154.35
Nov-96 353.70 171.23 194.51
Dec-96 337.04 171.07 192.76
Jan-97 445.37 183.23 232.40
Feb-97 365.74 173.09 221.25
Mar-97 353.70 161.79 216.65
Apr-97 379.63 166.85 235.23
May-97 564.81 185.76 254.01
Jun-97 562.03 191.45 244.32
Jul-97 735.19 211.66 298.83
Aug-97 792.59 211.33 304.50
Sep-97 866.67 223.82 305.41
Oct-97 566.67 212.24 239.09
Nov-97 505.56 213.30 230.66
Dec-97 427.78 209.88 203.29
Jan-98 407.41 216.47 227.08
Feb-98 515.27 236.78 249.46
Mar-98 387.96 245.51 233.09
Apr-98 396.30 249.67 253.54
May-98 300.46 235.97 208.36
Jun-98 252.78 252.61 200.26
Jul-98 206.48 249.85 206.50
Aug-98 185.19 200.98 157.84
Sep-98 185.19 228.68 174.59
Oct-98 256.48 237.70 218.59
Nov-98 355.56 261.74 248.55
Dec-98 385.19 295.70 285.36
Jan-99 525.93 338.70 356.23
Feb-99 444.44 308.34 301.35
Mar-99 311.11 330.76 323.69
Apr-99 367.59 340.05 329.58
May-99 362.96 332.23 340.43
Jun-99 537.04 361.89 424.50
Jul-99 458.33 356.63 441.69
Aug-99 424.07 370.76 476.31
Sep-99 535.19 370.19 476.33
</TABLE>
16
<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 our common stock as of January 10, 2000 by (i) each
person or entity known to us to own beneficially five percent or more of PRI's
common stock, (ii) each of our directors, (iii) the Chief Executive Officer and
the other Named Executive Officers and (iv) the executive officers and directors
as a group:
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)(2)
--------------------
NAME AND ADDRESS(3) NUMBER PERCENT
- ------------------- --------- --------
<S> <C> <C>
FMR Corp.(4)
82 Devonshire Street,
Boston, MA 02109............................................ 1,996,940 8.8%
Mordechai Wiesler(5)........................................ 832,710 3.6%
Dr. Amram Rasiel(6)......................................... 574,710 2.5%
Mitchell G. Tyson(7)........................................ 307,648 1.3%
Boruch B. Frusztajer(8)..................................... 105,512 *
Alexander V. d'Arbeloff(9).................................. 86,764 *
Robert G. Postle(10)........................................ 7,680 *
Stephen D. Allison(11)...................................... 8,184 *
Kenneth M. Thompson(12)..................................... 20,000 *
Edward A. Wagner(13)........................................ 4,975 *
Robert Klimm................................................ -- --
All directors and executive officers as a group (9
persons)(14).............................................. 1,948,183 8.4%
</TABLE>
- ------------------------
* Less than one percent.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. 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. Shares of common stock subject to options currently
exercisable or exercisable within 60 days following the date of this table
are deemed outstanding for computing the share ownership and percentage of
the person holding such options, but are not deemed outstanding for
computing the percentage of any other person.
(2) The number of shares of common stock deemed outstanding as of the date of
this table, January 10, 2000, is 22,761,449.
(3) Unless otherwise noted, address is in care of PRI Automation, Inc., 805
Middlesex Turnpike, Billerica, Massachusetts 01821-3986.
(4) Information is based on a Schedule 13G filed by FMR Corp. with the
Securities and Exchange Commission on January 7, 1999. The Schedule 13G
states that Fidelity Management & Research Company, a wholly-owned
subsidiary of FMR Corp. and an investment adviser registered under
Section 203 of the Investment Advisers Act of 1940, is the beneficial owner
of 1,690,440 shares as a result of acting as investment adviser to various
investment companies, that Fidelity Management
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Trust Company, a wholly-owned subsidiary of FMR Corp. and a bank as defined
in Section 3(a)(6) of the Securities Exchange Act of 1934, is the beneficial
owner of 297,000 shares as a result of its serving as investment manager of
institutional accounts and that Fidelity International Limited is the
beneficial owner of 9,500 shares. The Schedule 13G states that various
persons have the right to receive, or to direct the receipt of dividends
from, or the proceeds from the sale of, the common stock, and that no one
person's interest in the common stock is more than five percent.
(5) Includes 72,390 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(6) Includes 22,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(7) Includes 197,011 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table and 8,100 shares held
by members of Mr. Tyson's family.
(8) Includes 22,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table and 58,762 shares held
by members of Mr. Frusztajer's family.
(9) Includes 22,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(10) Includes 7,633 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(11) Includes 7,680 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(12) Includes 20,000 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(13) Includes 4,975 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table.
(14) Includes 375,689 shares issuable upon the exercise of outstanding options
exercisable within 60 days of the date of this table. See notes 5 through
13.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires our officers
and directors, and persons who own more than 10% of our common stock, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission. Officers, directors and greater-than-10% stockholders are required
by SEC regulations to furnish us with copies of all Section 16(a) forms they
file.
Based solely upon review of Forms 3 and 4 and amendments thereto furnished
to us during fiscal 1999 and Forms 5 and amendments thereto furnished with
respect to fiscal 1999, we believe that all of its officers, directors and
greater-than-10% stockholders fulfilled their Section 16(a) filing requirements
in a timely manner.
SOLICITATION
No person will pay any compensation in connection with the solicitation of
proxies for the annual meeting. We will reimburse brokers, banks and other
nominees for their out-of-pocket expenses and other reasonable clerical expenses
incurred in obtaining instructions from beneficial owners of common stock. In
addition to the solicitation by mail, the board of directors, officers and
certain employees may make special solicitation of proxies in certain instances,
personally or by telephone. We expect that the
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expense of any such special solicitation will be nominal. We will pay all
expenses incurred in connection with this solicitation.
INDEPENDENT ACCOUNTANTS
The board of directors has selected PricewaterhouseCoopers LLP as
independent accountants to audit our financial statements for the fiscal year
ending September 30, 2000.
We expect that representatives of PricewaterhouseCoopers LLP will be present
at the annual meeting, will have an opportunity to make a statement if they
desire to do so, and will be available to respond to appropriate questions from
stockholders.
STOCKHOLDER PROPOSALS
Stockholder proposals for inclusion in the proxy materials related to the
2001 annual meeting of stockholders, or special meeting in lieu thereof, must be
received by PRI at its executive offices no later than August 31, 2000.
In addition, our by-laws provide that a stockholder must give us written
notice not less than sixty days prior to the scheduled annual meeting describing
any proposal to be brought before such meeting, even if such item is not to be
included in PRI's proxy statement relating to such meeting. Such procedural
requirements are fully set forth in Article III of our By-laws.
MISCELLANEOUS
The board of directors 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 January 20, 2000 will receive a proxy statement
and our annual report to stockholders, which contains detailed financial
information about us. The annual report to stockholders is not incorporated
herein and is not deemed a part of this proxy statement. We will mail, without
charge, a copy of our 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: Shareholder Relations, PRI Automation, Inc., 805 Middlesex
Turnpike, Billerica, Massachusetts 01821.
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APPENDIX A
PRI AUTOMATION, INC.
2000 STOCK OPTION PLAN
SECTION 1. PURPOSES OF PLAN; DEFINITIONS
1.1. GENERAL PURPOSES. PRI Automation, Inc., a Massachusetts corporation
(the "Company"), desires to afford certain executives, key employees and
directors of, and certain other individuals providing services to, the Company
or its subsidiary companies an opportunity to initiate or increase their
proprietary interests in the Company, and thus to create in such persons an
increased interest in and greater concern for the long-term welfare of the
Company. The Company, by granting under this 2000 Stock Option Plan (this
"Plan") stock options to acquire shares of common stock of the Company (an
"Option"), seeks to retain the services of persons now holding key positions
with the Company and to secure the services of other persons capable of filling
key positions with the Company or its subsidiary companies.
1.2. DEFINITIONS. For purposes of this Plan, the following terms shall have
the indicated meanings:
"AFFILIATE" means a parent corporation, if any, and each subsidiary
corporation of the Company, as those terms are defined in Section 424 of the
Code.
"BOARD" means the Board of Directors of the Company.
"CAUSE" shall mean, with respect to any Option holder, a determination by
the Company (including the Board) or any Affiliate that the Holder's employment
or other relationship with the Company or any such Affiliate should be
terminated as a result of (i) a material breach by the Option holder of any
agreement to which the Option holder and the Company (or any such Affiliate) are
parties, (ii) any act (other than retirement) or omission to act by the Option
holder that may have a material and adverse effect on the business of the
Company, such Affiliate or any other Affiliate or on the Option holder's ability
to perform services for the Company or any such Affiliate, including, without
limitation, the proven or admitted commission of any crime (other than an
ordinary traffic violation), or (iii) any material misconduct or material
neglect of duties by the Option holder in connection with the business or
affairs of the Company or any such Affiliate.
"CODE" means the Internal Revenue Code of 1986, as amended, and any
successor code thereto, together with related rules, regulations and
interpretations; and any reference herein to a particular Section of the Code
shall include any successor provision of the Code.
"COMMITTEE" has the meaning set forth in Section 2.1 hereof.
"COMMON STOCK" means the Common Stock, par value $.01 per share, of the
Company, subject to adjustment pursuant to Section 8 hereof.
"GREATER-THAN-TEN-PERCENT STOCKHOLDER" means any individual who, at the time
he or she is granted an Option, owns or, as a result of the attribution rules of
Section 424(d) of the Code, is deemed to own more than ten percent of the total
combined voting power of all classes of stock of the Company or any Affiliate.
"INCENTIVE OPTION" means any Option designated and qualified as an
"incentive stock option" within the meaning of Section 422 of the Code. The
Company intends that Incentive Options will qualify as "incentive stock options"
within the meaning of Section 422 of the Code, and the terms of this Plan shall
be interpreted in accordance with this intention; the Company makes no warranty,
however, as to the qualification of any Option as an Incentive Option.
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"NONQUALIFIED OPTION" means any Option that is not an Incentive Option.
"NON-EMPLOYEE DIRECTOR" means any director who is not also an employee of
the Company, its parent or any subsidiary.
"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 "Affiliated Group Member"),
(ii) is not a former employee of the Company or any Affiliated Group Member who
is receiving compensation for prior services (other than benefits under a tax-
qualified retirement plan) during the Company's or any Affiliated Group Member's
taxable year, (iii) has not been an officer of the Company or any Affiliated
Group Member, and (iv) does not receive remuneration from the Company or any
Affiliated Group Member, either directly or indirectly, in any capacity other
than as a director. "Outside Director" shall be determined in accordance with
Section 162(m) of the Code and the Treasury regulations issued thereunder.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and any
successor act thereto, together with related rules, regulations and
interpretations.
SECTION 2. ADMINISTRATION
2.1. COMMITTEE. This Plan shall be administered by a committee (the
"Committee") consisting of at least two Outside Directors. It is the intention
of the Company that the Plan shall be administered to comply with the provisions
of Rule 16b-3 under the Securities Exchange Act of 1934 (the "Exchange Act"),
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 Non-Employee
Director as defined in the Rule. Except as specifically reserved to 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. Any or all
powers and functions of the Committee may at any time and from time to time be
exercised by the Board, and any reference in this Plan to the Committee shall be
deemed to refer to the Board to the extent the Board is exercising any of the
powers and functions of the Committee.
2.2. POWERS OF THE COMMITTEE. Subject to the terms and conditions of this
Plan, the Committee shall have the power:
(a) to determine from time to time the individuals to whom Options shall be
granted and the terms, conditions, restrictions and provisions (which
need not be identical) of each of those Options, including, with respect
to each Option, the time at which the Option shall be granted, the number
of shares of Common Stock that shall be subject to the Option, the
exercise price for each share of Common Stock subject to the Option
(which price shall be subject to the requirements of Section 6.3), the
period during which the Option shall be exercisable (whether in whole or
in part) and the time or times when each Option shall become exercisable;
(b) to modify or amend, in its sole discretion, conditionally or
unconditionally, any outstanding Option granted under this Plan,
including a reduction of the exercise price, an acceleration of the
vesting schedule, or an extension of the expiration date;
(c) to accelerate, in its sole discretion, an Option holder's right to
exercise his or her Option in whole or in part, conditionally or
unconditionally, at any time;
(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 this Plan;
(e) to delegate to a committee consisting of one or more officers of the
Company the authority to grant options under this Plan to eligible
persons who are not then subject to Section 16 of the
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Exchange Act and with respect to whom the Company does not wish to comply
with Section 162(m) of the Code, and to delegate to other persons the
responsibility for performing ministerial acts in furtherance of the
Plan's purpose;
(f) to engage the services of persons or organizations in furtherance of the
Plan's purpose, including but not limited to banks, insurance companies,
brokerage firms and consultants; and
(g) to construe and interpret this Plan and Options granted hereunder and to
establish, amend, and revoke rules and regulations for the
interpretation, management and administration of this Plan. In this
connection, the Committee may supply any omission, reconcile any
inconsistency, or correct any other defect in this Plan or in any Option
agreement in the manner and to the extent it shall deem necessary or
expedient to make this Plan fully effective.
All decisions and determinations by the Committee in the exercise of the
foregoing powers shall be final and binding upon the Company and Option holders.
No member or former member of the Committee or the Board shall be liable for any
action or determination made in good faith with respect to this Plan or any
Option.
2.3. APPOINTMENT AND PROCEEDINGS OF COMMITTEE. The Board may from time to
time appoint members of the Committee in substitution for or in addition to
members previously appointed, and subject to Section 2.1 hereof, may fill
vacancies, however caused, in the Committee. The Committee shall select one of
its members as its chairman and shall hold its meetings at such times and places
as it shall deem advisable. A majority of its members shall constitute a quorum,
and all actions of the Committee shall require the affirmative vote of a
majority of its members. Any action may be taken by a written instrument signed
by all of the members, and any action so taken shall be as fully effective as if
it had been taken by a vote of a majority of the members at a meeting duly
called and held.
SECTION 3. STOCK
3.1. STOCK TO BE ISSUED. The stock subject to Options granted under this
Plan may be shares of authorized and issued Common Stock, shares of Common Stock
held in treasury or both, at the discretion of the Company. The total number of
shares of Common Stock that may be issued pursuant to Options granted under the
Plan shall not exceed 400,000 shares in the aggregate; PROVIDED, HOWEVER, that
the class and aggregate number of shares subject to Options shall be subject to
adjustment as provided in Section 8 hereof. Any shares of Company Common Stock
available for future awards under the PRI Automation, Inc. 1994 Incentive and
Nonqualified Stock Option Plan ("Prior Plan") and any shares of Company Common
Stock represented by awards granted under the Prior Plan which are forfeited,
expire or are canceled without delivery of shares of stock, or which result in
the forfeiture of shares of stock back to the Company, shall again be available
for issuance under the Plan; provided, however, such additional shares under the
Prior Plan shall not exceed 600,000 shares of Company Common Stock (subject to
adjustment as provided in Section 8 hereof).
3.2. TERMINATION OF OPTION. If any Option granted under this Plan expires
or otherwise terminates without having been exercised in whole or in part, the
shares of Common Stock previously subject to the unexercised portion of that
Option may be the subject of new Options under this Plan.
3.3. NO FRACTIONAL SHARES. In no event shall any Option be exercisable for
a fraction of a share of Common Stock.
SECTION 4. ELIGIBILITY
4.1. INDIVIDUALS ELIGIBLE. Incentive Options may be granted only to
officers and other employees of the Company and any Affiliate, including members
of the Board who are also employees of the Company or any Affiliate.
Nonqualified Options may be granted to officers or other employees of the
Company or any Affiliate, including members of the Board or the board of
directors of any Affiliate,
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and to consultants and other individuals who render services to the Company or
any Affiliate regardless of whether they are employees.
4.2. GREATER-THAN-TEN-PERCENT STOCKHOLDERS. Except as may otherwise be
permitted by the Code or other applicable law or regulation, no Incentive Option
shall be granted to a Greater-Than-Ten-Percent Stockholder unless (a) the
exercise price per share under the Incentive Option is not less than 110% of the
fair market value of the Common Stock at the time at which the Incentive Option
is granted and (ii) the Incentive Option is not exercisable to any extent after
the fifth anniversary of the date on which the Incentive Option is granted.
4.3. MAXIMUM AGGREGATE FAIR MARKET VALUE. The aggregate fair market value
(determined at the time the Incentive Option is granted) of the Common Stock
with respect to which Incentive Options are exercisable for the first time by
any Option holder during any calendar year under this Plan and any other plans
of the Company or any Affiliate for the issuance of incentive stock options
(within the meaning of Section 422 of the Code) 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.
To the extent any Option exceeds the foregoing limitation, it shall be deemed a
Nonqualified Option.
4.4. LIMITATION ON GRANTS. In no event may any individual be granted
Options with respect to more than 300,000 shares of Common Stock in any calendar
year (subject to adjustment as provided in Section 8 hereof). The number of
shares of Common Stock relating to an Option grant in a calendar year that is
subsequently forfeited, canceled 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 5. TERMINATION OF EMPLOYMENT OR DEATH OF OPTION HOLDER
5.1. TERMINATION OF EMPLOYMENT. Except as otherwise expressly provided
herein, an Option shall terminate on the earliest of:
(a) the date of expiration thereof;
(b) the date of cancellation thereof pursuant to Section 8.3;
(c) thirty days after the date on which the Option holder's employment with,
or directorship or other services to, the Company and all Affiliates
terminates other than for Cause; PROVIDED, HOWEVER, that if, before the
date of expiration of the Option, the Option holder shall be retired in
good standing from the employ of the Company for reasons of age under the
then established rules of the Company, the Option shall terminate on the
earlier of such date of expiration or twelve months after the date of
such retirement. In the event of such retirement, the Option holder shall
have the right prior to the termination of such Option to exercise the
Option to the extent to which the Option holder was entitled to exercise
such Option immediately prior to such retirement; and
(d) the date on which the Option holder's employment with, or directorship
or other services to, the Company and all Affiliates is terminated by the
Company or any Affiliate for Cause;
PROVIDED, HOWEVER, that Nonqualified Options need not, unless the Committee
determines otherwise, be subject to the provisions set forth in clauses (c) and
(d) above nor to Section 5.2 below. Whether authorized leave of absence, or
absence on military or government service, shall constitute termination of an
employment relationship between the Company and the Option holder shall be
determined by the Committee at the commencement thereof, and the Committee shall
promptly notify the Option
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holder of such determination. Options shall not be affected by any Option
holder's change of employment within the Company and any Affiliate or change in
the identity of the Company or any Affiliate to whom directorship or other
services are provided, so long as the Option holder continues to be an employee
of, or to provide such services to, the Company or any Affiliate.
5.2. DEATH OR PERMANENT DISABILITY OF OPTION HOLDER. In the event of the
death or permanent and total disability of an Option holder prior to termination
of the Option holder's services to the Company or any Affiliate and prior to the
date of expiration of such Option, such Option shall terminate on the earliest
of its date of expiration, its date of cancellation pursuant to Section 8.3, and
the date that is twelve (12) months after the date of such death or disability.
After the death of the Option holder, his or her executors, administrators or
any individual or individuals to whom the Option may be transferred by will or
by the laws of descent and distribution, shall have the right, at any time prior
to the date of such termination, to exercise the Option to the extent the Option
holder was entitled to exercise the Option immediately prior to his or her
death. "Permanent and total disability" for these purposes shall be determined
in accordance with Section 22(e)(3) of the Code and the rules, regulations and
interpretations issued thereunder.
SECTION 6. TERMS OF OPTION AGREEMENTS
Each Option shall be evidenced by an agreement (an "Option Agreement") in
writing that shall contain such terms, conditions, restrictions and other
provisions as the Committee shall from time to time deem appropriate. Any
additional provisions shall not, however, be inconsistent with any other term or
condition of this Plan and shall not cause any Incentive Option to fail to
qualify as an incentive stock option within the meaning of Section 422 of the
Code. Option agreements need not be identical, but each Option agreement shall,
by appropriate language, include the substance of the following provisions:
6.1. EXPIRATION OF OPTION. Notwithstanding any other provision of this Plan
or of the Option agreement, such Option shall expire on the date specified in
the Option agreement, which date shall not, in the case of an Incentive Option,
be later than the tenth anniversary (the 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 hereof.
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.
The total number of shares of stock subject to an Option may, but need not,
be allotted in periodic installments (which may, but need not, be equal). The
Option Agreement may provide that from time to time during each of such
installment periods, the Option may become exercisable ("vest") with respect to
some or all of the shares allotted to that period, and may be exercised with
respect to some or all of the shares allotted to such period and/or any prior
period as to which the Option became vested but was not fully exercised. The
Option may be subject to such other terms and conditions on the time or times
when it may be exercised (which may be based on performance or other criteria)
as the Committee may deem appropriate. During the remainder of the term of the
Option (if its term extends beyond the end of the installment periods), the
Option may be exercised from time to time with respect to any shares then
remaining subject to the Option. In addition, the Option Agreement may, but need
not, include a provision whereby the Option holder may elect at any time, while
the Option holder is employed by or providing services to the Company or any
Affiliate, to exercise the Option as to any part or all of the shares subject to
the Option prior to the full vesting of the Option; provided, however, any
unvested shares shall be subject to a repurchase right in the
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Company at the Exercise Price in the event of the Optionee's termination of
employment with, or services to, the Company or any Affiliate.
6.3. EXERCISE PRICE. The exercise price per share under each Option shall
be determined by the Committee at the time the Option is granted and shall not
be less than the par value of the Common Stock obtainable upon the exercise
thereof; PROVIDED, HOWEVER, that the exercise price of any Incentive Option
shall not, unless otherwise permitted by the Code, 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 these
purposes, the "fair market value" of the Common Stock shall equal (a) the
closing price per share on the date of grant of the Option as reported by a
nationally recognized stock exchange, (b) if the Common Stock is not listed on
such an exchange, as reported by the National Association of Securities Dealers
Automatic Quotation System, Inc. ("NASDAQ"), or (c) if the Common Stock is not
quoted on NASDAQ, the fair market value as determined by the Committee.
6.4. TRANSFERABILITY OF OPTIONS AND OPTION SHARES. No Incentive Option
shall be transferable by its holder or by operation of law, otherwise than by
will or under the laws of descent and distribution and shall not be subject to
execution, attachment or similar process. Each Incentive Option shall, during
the Option holder's lifetime, be exercisable only by the Option holder. The
Committee may in its discretion provide upon the grant of any Option that the
shares of Common Stock purchasable upon exercise of such Option shall be subject
to such restrictions on transferability as the Committee may determine. Upon any
attempt to transfer any Option under the Plan or any right or privilege
conferred hereby, contrary to the provisions of the Plan, or (if the Committee
shall so determine) upon any levy or any attachment or similar process upon the
rights and privileges conferred hereby, such Option shall thereupon terminate
and become null and void.
6.5. RIGHTS OF OPTION HOLDERS. No Option holder or other person shall, by
virtue of the granting of an Option, be deemed for any purpose to be the owner
of any shares of Common Stock subject to such Option or to be entitled to the
rights or privileges of a holder of such shares unless and until the Option
shall have been exercised pursuant to the terms thereof with respect to such
shares and the Company shall have issued and delivered the shares to the Option
holder.
6.6. REPURCHASE RIGHT. The Committee may in its discretion provide upon the
grant of any Option that the Company shall have an option to repurchase, upon
terms and conditions 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 of grant of the Option for the shares subject to
repurchase. In the event the Committee grants an Option subject to such a
repurchase option, then so long as the shares purchased upon exercise of that
Option remain subject to the repurchase option, each certificate representing
those shares shall bear a legend satisfactory to counsel for the Company
referring to the Company's repurchase option.
6.7. "LOCKUP" AGREEMENT. The Committee may in its discretion specify upon
granting an Option that the Option holder shall agree for a period of time (not
to exceed 180 days) from the effective date of any registration of securities of
the Company (upon request of the Company or the underwriters managing any
underwritten offering of the Company's securities), not to sell, make any short
sale of, loan, grant any option for the purchase of, or otherwise dispose of any
shares issued pursuant to the exercise of such Option, without the prior written
consent of the Company or such underwriters, as the case may be.
SECTION 7. METHOD OF EXERCISE; PAYMENT OF EXERCISE PRICE
7.1. METHOD OF EXERCISE. Any Option may be exercised by the Option holder
by delivering to the Company, on any business day prior to the termination of
the Option, a written notice specifying the
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number of shares of Common Stock the Option holder then desires to purchase and
the address to which the certificates for such shares are to be mailed,
accompanied by payment of the exercise price for such shares.
7.2. PAYMENT OF EXERCISE PRICE. Payment for the shares of Common Stock
purchased upon exercise of an Option shall be made by:
(a) cash in an amount, or a check, bank draft or postal or express money
order payable in an amount, equal to the aggregate exercise price of the
shares being purchased;
(b) with the consent of the Committee, shares of Common Stock having a fair
market value (as defined for purposes of Section 6.3 hereof) equal to
such aggregate exercise price and owned by the Option holder for a period
of at least six months;
(c) with the consent of the Committee, a personal recourse note issued by
the Option holder to the Company in a principal amount equal to such
aggregate exercise price and with such other terms, including interest
rate and maturity, as the Committee may determine in its discretion;
PROVIDED, HOWEVER, that the interest rate borne by such note shall not be
less than the lowest applicable federal rate, as defined in
Section 1274(d) of the Code;
(d) with the consent of the Committee, such other consideration that is
acceptable to the Committee and that has a fair market value, as
determined by the Committee, equal to such aggregate exercise price,
including any broker-directed cashless exercise/resale procedure adopted
by the Committee; or
(e) with the consent of the Committee, any combination of the foregoing.
As promptly as practicable after receipt of notice and payment pursuant to
Section 7.1 hereof and any documents required pursuant to Sections 9.2 and 9.3
hereof, the Company shall deliver to the Option holder a certificate registered
in the name of the Option holder and representing the number of shares with
respect to which such Option has been so exercised; PROVIDED, HOWEVER, that if
any law or regulation or order of the Securities and Exchange Commission or any
other body having jurisdiction in the premises shall require the Company or the
Option holder to take any action in connection with the shares then being
purchased, the date for the delivery of the certificates for such shares shall
be extended for the period necessary to take and complete such action. Delivery
by the Company of the certificate for such shares shall be deemed effected for
all purposes when the Company or a stock transfer agent of the Company shall
have deposited such certificate in the United States mail, addressed to the
Option holder, at the address specified in the notice delivered pursuant to
Section 7.1 hereof.
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 enter
into, make or authorize, without limitation, (a) any adjustment,
recapitalization, reorganization or other change in the Company's capital
structure or its business, (b) any merger or consolidation of the Company,
(c) any issue of Common Stock or of bonds, debentures, preferred or prior
preference stock or other capital stock ahead of or affecting the Common Stock
or the rights thereof, (d) a dissolution or liquidation of the Company, (e) any
sale or transfer of all or any part of the assets or business of the Company, or
(f) 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 any subdivision or consolidation of shares of its stock or other capital
readjustment, the payment of a stock dividend, or any other increase or
reduction of the number of shares of its stock outstanding, in any such case
without receiving compensation therefor in money, services or property, then
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(a) the number, class and price per share of stock subject to each
outstanding Option shall be appropriately adjusted in such a manner as to
entitle an Option holder 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 the Option holder exercised the Option in
full immediately prior to such event, and
(b) the number and class of shares with respect to which Options may be
granted under Section 3.1 of this Plan and the maximum annual limitation
on grants under Section 4.4 shall be adjusted by substituting for the
total number of shares of Common Stock then reserved for issuance under
this Plan and for the maximum annual limitation on grants 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.
8.3. MERGERS, SALES, ETC. If the Company shall be a party to a
reorganization or merger with one or more other corporations (whether or not the
Company is the surviving or resulting corporation), shall consolidate with or
into one or more other corporations, shall be liquidated, or shall sell or
otherwise dispose of substantially all of its assets to another corporation
(each a "Transaction"), then each outstanding unexercised option shall
automatically accelerate so that it shall, prior to the effective date of the
Transaction, become fully exercisable for all of the shares of Common Stock at
the time subject to such option; provided, however, that an outstanding option
shall not so accelerate if and to the extent that:
(a) such option is under the terms of the Transaction either to be assumed
by the surviving or resulting corporation (or its parent);
(b) such option is under the terms of the Transaction to remain outstanding
and be exercisable in shares of Common Stock or, if applicable, shares of
such stock or other securities, cash or property as the holders of shares
of Common Stock are to receive pursuant to the terms of such Transaction;
or
(c) the acceleration of such option is subject to other limitations imposed
by the Board or Committee at the time of the option grant.
The determination of option comparability under clause (a) above shall be made
by the Board or Committee, and its determination shall be final, binding and
conclusive. Immediately upon the consummation of the Transaction, all
outstanding options shall terminate and cease to be outstanding, unless such
options are assumed by the surviving or resulting corporation (or its parent)
under clause (a) above or remain outstanding under clauses (b) or (c) above.
8.4. 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.
8.5. MISCELLANEOUS. Adjustments under this Section 8 shall be determined by
the Committee, and such determinations shall be conclusive. The Committee shall
have the discretion and power in any such event to determine and to make
effective provision for acceleration of the time or times at which any Option or
portion thereof shall become exercisable. No fractional shares of Common Stock
shall be issued under this Plan on account of any adjustment specified above.
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SECTION 9. GENERAL RESTRICTIONS
9.1. GRANTING OF OPTIONS. No Option may be granted under this Plan after
the tenth anniversary of the effective date hereof.
9.2. INVESTMENT REPRESENTATIONS. The Company may require any individual 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 individual is acquiring the Common Stock subject to the Option
for his or her own account for investment and not with a view to the resale or
distribution thereof, and to such other effects as the Company deems necessary
or advisable in order to comply with the Securities Act and applicable state
securities laws.
9.3. COMPLIANCE WITH SECURITIES LAWS. The Company shall not be required to
sell or issue any shares under any Option if the sale or issuance of such shares
would constitute a violation by the Option holder or the Company of any
provision of any law or regulation of any governmental authority, including the
Securities Act. In addition, the Company shall not be required to sell or issue
shares upon the exercise of any Option unless the Committee has received
evidence satisfactory to it that the holder of such Option will not transfer
such shares except pursuant to a registration statement in effect under the
Securities 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 Securities Act, the Company may imprint upon
any certificate representing shares so issued the following legend or any other
legend that counsel for the Company considers necessary or advisable to comply
with the Securities Act and applicable state securities laws:
"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 issuer of an
opinion of counsel satisfactory to the issuer, in form and
substance satisfactory to the issuer, that registration is not
required for such sale or transfer."
The Company may, but shall not be obligated to, register the shares of stock
covered by any Options pursuant to the Securities Act. In the event such shares
are so registered, the Company may remove any legend on certificates
representing such shares. The Company shall not be obligated to take any
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.
9.4. OTHER CERTIFICATE LEGENDS. The Company may endorse such other legends
upon the certificates for shares of Common Stock issued upon exercise of an
Option and may issue such "stop transfer" instructions to the transfer agent for
the Common Stock as the Committee may, in its discretion, determine to be
necessary or appropriate (a) to implement the provisions of this Plan and such
Option with respect to such shares and (b) to permit the Company to determine
the occurrence of a disqualifying disposition (as defined in Section 421(b) of
the Code) of shares issued upon exercise of Incentive Options.
9.5. EMPLOYMENT OBLIGATION. The granting of any Option shall not impose
upon the Company or any Affiliate any obligation to employ or continue to employ
any Option holder. The right of the Company and each Affiliate to terminate the
employment of any officer or other employee thereof shall not be diminished or
affected by reason of the fact that an Option has been granted to such officer
or other employee.
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SECTION 10. WITHHOLDING TAXES
10.1. RIGHTS OF COMPANY. The Company may require an employee exercising a
Nonqualified Option, or disposing of shares of Common Stock acquired pursuant to
the exercise of an Incentive Option in a disqualifying disposition (as defined
in Section 421(b) of the Code), to reimburse the Company or Affiliate that
employs such employee for any taxes required by any government to be withheld or
otherwise deducted and paid by such employer corporation in respect of the
issuance or disposition of such shares. In lieu thereof, the employer
corporation shall have the right to withhold the amount of such taxes from any
other sums due or to become due from such corporation to the employee upon such
terms and conditions as the Committee may prescribe. The employer corporation
may, in its discretion, hold the stock certificate to which such employee is
otherwise entitled upon the exercise of an Option as security for the payment of
any such withholding tax liability, until cash sufficient to pay that liability
has been received or accumulated.
10.2. PAYMENT IN SHARES. With the consent of the Committee, an employee may
elect to have any required minimum tax withholding obligation satisfied, in
whole or in part, by (i) authorizing the Company to withhold from shares of
Common Stock to be issued pursuant to the exercise of a Nonqualified Option a
number of shares with an aggregate fair market value (as defined in Section 6.3
hereof determined as of the date the withholding is effected) that would satisfy
the withholding amount due with respect to such exercise, or (ii) transferring
to the Company shares of Common Stock owned by the employee with an aggregate
fair market value (as defined in Section 6.3 hereof determined as of the date
the withholding is effected) that would satisfy the withholding amount due.
10.3. NOTICE OF DISQUALIFYING DISPOSITION. Each holder of an Incentive
Option shall agree to notify the Company in writing immediately after making a
disqualifying disposition (as defined in Section 421(b) of the Code) of any
Common Stock purchased upon exercise of the Incentive Option.
SECTION 11. AMENDMENT OR TERMINATION OF PLAN
11.1. AMENDMENT. The Board may terminate the Plan and may amend the Plan at
any time, and from time to time.
Except as provided in Section 8 hereof, the rights and obligations under any
Option granted before amendment of this Plan or any unexercised portion of such
Option shall not be adversely affected by amendment of this Plan or such Option
without the consent of the holder of such Option.
11.2. TERMINATION. This Plan shall terminate as of the tenth anniversary of
its effective date. The Board may terminate this Plan at any earlier time for
any or no reason. No Option may be granted after the Plan has been terminated.
No Option granted while this Plan is in effect shall be altered or impaired by
termination of this Plan, except upon the consent of the holder of such Option.
The power of the Committee to construe and interpret this Plan and the Options
granted prior to the termination of this Plan shall continue after such
termination.
SECTION 12. NONEXCLUSIVITY OF PLAN
Neither the adoption of this Plan by the Board nor the submission of this
Plan to the stockholders of the Company for approval shall be construed as
creating any limitations on the power of the Board to adopt such other incentive
arrangements as it may deem desirable, including the granting of stock options
otherwise than under this Plan, and such arrangements may be either applicable
generally or only in specific cases.
The Committee's determinations under the Plan need not be uniform and may be
made by it selectively among persons who receive, or are eligible to receive,
awards under the Plan (whether or not such persons are similarly situated).
Without limiting the generality of the foregoing, the Committee shall be
entitled, among other things, to make non-uniform and selective determinations,
and to
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enter into non-uniform and selective Plan agreements, as to (i) the persons to
receive awards under the Plan, (ii) the terms and provisions of awards under the
Plan, (iii) the exercise by the Committee of its discretion in respect of the
exercise of options pursuant to the terms of the Plan, and (iv) the treatment of
leaves of absence pursuant to Section 5.1 hereof.
SECTION 13. EFFECTIVE DATE
This Plan shall become effective upon its adoption by the Board, PROVIDED
that the stockholders of the Company shall have approved this Plan within twelve
months prior to or following the adoption of this Plan by the Board. Subject to
the foregoing, Options may be granted under the Plan at any time subsequent to
its effective date; PROVIDED, HOWEVER, that (a) no such Option shall be
exercised or exercisable unless the stockholders of the Company shall have
approved the Plan within twelve months prior to or following the adoption of
this Plan by the Board, and (b) all Options issued prior to the date of such
stockholders' approval shall contain a reference to such condition.
SECTION 14. PROVISIONS OF GENERAL APPLICATION
14.1. SEVERABILITY. The invalidity or unenforceability of any provision of
this Plan shall not affect the validity or enforceability of any other provision
of this Plan, each of which shall remain in full force and effect.
14.2. CONSTRUCTION. The headings in this Plan are included for convenience
only and shall not in any way effect the meaning or interpretation of this Plan.
Any term defined in the singular shall include the plural, and vice versa. The
words "herein," "hereof" and "hereunder" refer to this Plan as a whole and not
to any particular part of this Plan. The word "including" as used herein shall
not be construed so as to exclude any other thing not referred to or described.
14.3. FURTHER ASSURANCES. The Company and any holder of an Option shall
from time to time execute and deliver any and all further instruments, documents
and agreements and do such other and further acts and things as may be required
or useful to carry out the intent and purpose of this Plan and such Option and
to assure to the Company and such Option holder the benefits contemplated by
this Plan; PROVIDED, HOWEVER, that neither the Company nor any Option holder
shall in any event be required to take any action inconsistent with the
provisions of this Plan.
14.4. GOVERNING LAW. This Plan and each Option shall be governed by the
laws of the Commonwealth of Massachusetts.
* * * * *
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APPENDIX B
PRI AUTOMATION, INC.
2000 EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
PURPOSE, SCOPE AND ADMINISTRATION OF THE PLAN
1.1 PURPOSE AND SCOPE
The purpose of the PRI Automation, Inc. 2000 Employee Stock Purchase Plan is
to assist employees of PRI Automation, Inc. and its subsidiaries in acquiring a
stock ownership interest in the Company pursuant to a plan which is intended to
qualify as an "employee stock purchase plan" under Section 423 of the Internal
Revenue Code of 1986, as amended.
1.2 ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Committee. The Committee shall have
the power to make, amend and repeal rules and regulations for the interpretation
and administration of the Plan consistent with the qualification of the plan
under Section 423 of the Code, and the Committee also is authorized to change
the Option Periods, Offering Dates and Exercise Dates under the Plan by
providing written notice to all Employees at least 15 days prior to the date
following which such changes will take effect. The Committee may delegate
administrative tasks under the Plan to one or more agents. The Committee's
interpretation and decisions in respect to the Plan shall be final and
conclusive.
ARTICLE II
DEFINITIONS
Whenever the following terms are used in this Plan, they shall have the
meaning specified below unless the context clearly indicates to the contrary.
The singular pronoun shall include the plural where the context so indicates.
2.1 "BOARD" shall mean the Board of Directors of the Company.
2.2. "CODE" shall mean the Internal Revenue Code of 1986, as amended.
2.3 "COMMITTEE" shall mean the Compensation Committee of the Board, which
Committee shall administer the Plan as provided in Section 1.2 hereof.
2.4 "COMMON STOCK" shall mean shares of common stock of the Company.
2.5 "COMPANY" shall mean PRI Automation, Inc..
2.6 "COMPENSATION" shall mean for the purpose of any offering pursuant to the
Plan, base pay. Compensation shall not include any deferred compensation
other than contributions by an Employee through a salary reduction agreement
to a cash or deferred plan pursuant to Section 401(k) of the Code, or to a
cafeteria plan pursuant to Section 125 of the Code.
2.7 "ELIGIBLE EMPLOYEE" shall mean an Employee (a) who is employed by the
Company or a Subsidiary (b) who is customarily scheduled to work at least
20 hours per week and (c) whose customary employment is more than five
(5) months in a calendar year.
2.8 "EMPLOYEE" shall mean any employee of the Company or a Subsidiary.
2.9 "EXERCISE DATE" shall mean each March 31 and September 30.
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2.10 "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended.
2.11 "FAIR MARKET VALUE" of a share of Common Stock as of a given date shall
mean (i) the average of the closing price of Common Stock on the trading
date previous to such date on a recognized national securities exchanges,
or, if not listed on any such exchange on the trading date previous to such
date, the last sale price reported in the NASDAQ System as of 4:00 p.m.,
New York time on the trading date previous to such date, or (iii) if on any
date such securities are not quoted in the NASDAQ System, the fair market
value of a share of Common Stock as established by the Committee acting in
good faith.
2.12 "OFFERING DATE" shall mean each April 1 and October 1; provided, however,
that the first Offering Date under the Plan shall be April 1, 2000.
2.13 "OPTION PERIOD" shall mean the period beginning on an Offering Date and
ending on the next succeeding Exercise Date.
2.14 "OPTION PRICE" shall mean the purchase price of a share of Common Stock
hereunder as provided in Section 4.1 hereof.
2.15 "PARTICIPANT" shall mean any Eligible Employee who elects to participate.
2.16 "PLAN" shall mean this PRI Automation, Inc. 2000 Employee Stock Purchase
Plan, as the same may be amended from time to time.
2.17 "PLAN ACCOUNT" shall mean a bookkeeping account established and maintained
by the Company in the name of each Participant.
2.18 "SUBSIDIARY" shall mean any corporation in an unbroken chain of
corporations beginning with the Company if each of the corporations other
than the last corporation in the unbroken chain then owns stock possessing
50% or more of the total combined voting power of all classes of stock in
one of the other corporations in such chain.
ARTICLE III
PARTICIPATION
3.1 ELIGIBILITY
An Eligible Employee may participate in the Plan if immediately after the
applicable Offering Date, such Employee would not be deemed for purposes of
Section 423(b)(3) of the Code to possess 5% or more of the total combined voting
power or value of all classes of stock of the Company or any Subsidiary.
3.2 ELECTION TO PARTICIPATE; PAYROLL DEDUCTIONS
(a) An Eligible Employee may participate in the Plan only by means of
payroll deduction. An Eligible Employee may elect to participate in the Plan
during on Option Period by delivering to the Company in the calendar month
preceding the Offering Date on which such initial Option Period commences a
written payroll deduction authorization on a form prescribed by the Company.
(b) Payroll deductions shall be equal to at least 1%, but not more than
10%, of the Participant's Compensation. Amounts deducted from a Participant's
Compensation pursuant to this Section 3.2 shall be credited to the Participant's
Plan Account.
(c) The Committee shall be entitled to amend the maximum payroll deduction
percentage as to any future Option Periods; provided, however, the maximum
payroll deduction shall not exceed 15% of the Participant's Compensation.
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ARTICLE IV
PURCHASE OF SHARES
4.1 OPTION PRICE
The Option Price per share of the Common Stock sold to Participants
hereunder shall be 85% of the Fair Market Value of such share on either the
Offering Date or the Exercise Date of the Option Period, whichever is lower, but
in no event shall the Option Price per share be less than the par value per
share of the Common Stock.
4.2 PURCHASE OF SHARES
(a) On each Exercise Date on which he or she is employed, each Participant
will automatically and without any action on his or her part be deemed to have
exercised his or her option to purchase at the Option Price the largest number
of whole shares of Common Stock which can be purchased with the amount in the
Participant's Plan Account. The balance, if any, other than amounts representing
fractional shares remaining in the Participant's Plan Account (after exercise of
his or her option) as of an Exercise Date shall be returned to the Participant.
Fractional shares will not be issued under the Plan and any accumulated payroll
deductions which would have otherwise been used to purchase such shares shall be
automatically forwarded to the next Offering Period, unless the Participant
elects to have such amounts returned to him or her.
(b) As soon as practicable following each Exercise Date, the Company will
deliver to the Participant a certificate issued in his or her name for such
number of shares purchased by such Participants pursuant to subsection
(a) above, or by depositing said shares in the Participant's brokerage account
at a stock broker designated by the Company. In the event the Company is
required to obtain from any commission or agency authority to issue any such
certificate, the Company will seek to obtain such authority. Inability of the
Company to obtain from any such commission or agency authority which counsel for
the Company deems necessary for the lawful issuance of any such certificate
shall relieve the Company from liability to any Participant except to refund to
him or her the amount withheld.
4.3 LIMITATIONS ON PURCHASE
No Employee shall be granted an option under the Plan which permits his or
her rights to purchase Common Stock under the Plan or any other employee stock
purchase plan of the Company, or any of its Subsidiaries to accrue at a rate
which exceeds $25,000 (as measured by the Fair Market Value of such Common Stock
at the time the option is granted) for each calendar year such option is
outstanding. No Employee may purchase during any Option Period more than 1,000
shares. For purposes of this Section 4.3, the right to purchase Common Stock
under an option accrues when the option (or any portion thereof) becomes
exercisable, and the right to purchase Common Stock which has accrued under one
option under the Plan may not be carried over to any other option.
4.4 TRANSFERABILITY OF RIGHTS
An option granted under the Plan shall not be transferable and is
exercisable only by the Participant. No option or interest or right therein or
part thereof shall be liable for the debts, contracts or engagements of the
Participant or his or her successors in interest or shall be subject to
disposition by alienation, anticipation, pledge, encumbrance, assignment or any
other means whether such disposition be voluntary or involuntary or by operation
of law by judgment, levy, attachment, garnishment or any other legal or
equitable proceedings (including bankruptcy), and any attempt at disposition
thereof shall be null and void and of no effect.
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ARTICLE V
PROVISIONS RELATING TO COMMON STOCK
5.1 COMMON STOCK RESERVED
There shall be 350,000 authorized but unissued or reacquired shares of
Common Stock reserved for issuance pursuant to this Plan, subject to adjustment
in accordance with Section 5.2 hereof.
5.2 ADJUSTMENT FOR CHANGES IN COMMON STOCK
In the event that adjustments are made in the number of outstanding shares
of Common Stock or the shares are exchanged for a different class of stock of
the Company by reason of a stock dividend, stock split or other subdivision, the
Committee shall make appropriate adjustments in (a) the number and class of
shares or other securities that may be reserved for purchase hereunder, (b) the
Option Price of outstanding options and (c) the maximum number of shares that an
Employee may purchase under the second sentence of Section 4.3.
5.3 MERGER, ACQUISITION OR LIQUIDATION
In the event of the merger or consolidation of the Company into another
corporation, the acquisition by another corporation of all or substantially all
of the Company's assets or 80% or more of the Company's then outstanding voting
stock or the liquidation or dissolution of the Company, the date of exercise
with respect to outstanding options shall be the business day immediately
preceding the effective date of such merger, consolidation, acquisition,
liquidation or dissolution unless the Committee shall, in its sole discretion,
provide for the assumption or substitution of such options in a manner complying
with Section 424(a) of the Code.
5.4 INSUFFICIENT SHARES
If the aggregate funds available for the purchase of Common Stock on any
Exercise Date would cause an issuance of shares in excess of the number provided
for in Section 5.1 hereof, (a) the Committee shall proportionately reduce the
number of shares that would otherwise be purchased by each Participant in order
to eliminate such excess, and (b) the Plan shall automatically terminate
immediately after such Exercise Date.
5.5 RIGHTS AS STOCKHOLDERS
With respect to shares of Common Stock subject to an option, a Participant
shall not be deemed to be a stockholder and shall not have any of the rights or
privileges of a stockholder. A Participant shall have the rights and privileges
of a stockholder when, but not until, a certificate for shares has been issued
to him or her following exercise of his or her option.
ARTICLE VI
TERMINATION OF PARTICIPATION
6.1 CESSATION OF CONTRIBUTIONS; VOLUNTARY WITHDRAWAL
(a) A Participant may cease payroll deductions during an Option Period by
delivering written notice of such cessation to the Company. Upon any such
cessation, such Participant may elect either to withdraw from the Plan pursuant
to subsection (b) below or to have amounts credited to his or her Plan Account
held in the Plan for the purchase of Common Stock pursuant to Section 4.2. A
Participant who ceases contributions to the Plan during any Option Period shall
not be permitted to resume contributions to the Plan during such Option Period.
(b) A Participant may withdraw from the Plan at any time by written notice
to the Company prior to the close of business on an Exercise Date. Within
21 days after the notice of withdrawal is delivered, the Company shall refund
the entire amount, if any, in a Participant's Plan Account to him or her, and
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thereupon, the Participant's payroll deduction authorization, his or her
interest in the Plan and his or her option under the Plan shall terminate. Any
Eligible Employee who withdraws from the Plan may again become a Participant in
accordance with Section 3.2 hereof.
6.2 TERMINATION OF ELIGIBILITY
(a) If a Participant ceases to be eligible under Section 3.1 hereof for any
reason, the amount in such Participant's Plan Account will be refunded to the
Participant or his or her designated beneficiary or estate within 21 days of his
or her termination of employment or other cessation of eligibility.
(b) Upon payment by the Company to the Participant or his or her beneficiary
or estate of the remaining balance, if any, in the Participant's Plan Account,
the Participant's interest in the Plan and the Participant's option under the
Plan shall terminate.
ARTICLE VII
GENERAL PROVISIONS
7.1 CONDITIONS OF EMPLOYMENT
Neither the creation of the Plan nor an Employee's participation therein
shall be deemed to create any right of continued employment or in any way affect
the right of the Company or a Subsidiary to terminate an Employee at any time
with or without cause.
7.2 AMENDMENT ON TERMINATION OF THE PLAN
The Board may at any time terminate or amend the Plan. No such termination
shall affect options previously granted, nor may an amendment make any change in
any option theretofore granted which would adversely affect the rights of any
participant holding options under the Plan.
7.3 USE OF FUNDS; NO INTEREST PAID
All funds received by the Company by reason of purchase of Common Stock
hereunder will be included in the general funds of the Company free of any trust
or other restriction and may be used for any corporate purpose. No interest will
be paid to any Participant or credited under the Plan.
7.4 TERM; APPROVAL BY STOCKHOLDERS
The Plan shall terminate on the tenth anniversary of the date of its initial
approval by the stockholders of the Company, unless earlier terminated by action
of the Board. No option may be granted during any period of suspension of the
Plan nor after termination of the Plan. The Plan will be submitted for the
approval of the Company's stockholders within 12 months after the date of the
Board's initial adoption of the Plan. Options may be granted prior to such
stockholder approval; provided, however, that such options shall not be
exercisable prior to the time when the Plan is approved by the stockholders;
provided further that if such approval has not been obtained by the end of said
12-month period, all options previously granted under the Plan shall thereupon
be canceled and become null and void.
7.5 EFFECT UPON OTHER PLANS
The adoption of the Plan shall not affect any other compensation or
incentive plans in effect for the Company or any Subsidiary. Nothing in this
Plan shall be construed to limit the right of the Company or any Subsidiary
(a) to establish any other forms of incentives or compensation for employees of
the Company or any Subsidiary or (b) to grant or assume options otherwise than
under this Plan in connection with any proper corporate purpose, including, but
not by way of limitation, the grant or assumption of options in connection with
the acquisition, by purchase, lease, merger, consolidation or otherwise, of the
business, stock or assets of any corporation, firm or association.
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7.6 CONFORMITY TO SECURITIES LAWS
Notwithstanding any other provision of this Plan, this Plan and the
participation in this Plan by any individual who is then subject to Section 16
of the Exchange Act shall be subject to any additional limitations set forth in
any applicable exemptive rule under Section 16 of the Exchange Act (including
any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the
application of such exemptive rule. To the extent permitted by applicable law,
the Plan shall be deemed amended to the extent necessary to conform to such
applicable exemptive rule.
7.7 NOTICE OF DISPOSITION OF SHARES
The Company may require any participant to give the Company prompt notice of
any disposition of shares of Common Stock, acquired pursuant to the Plan within
two years after the applicable Offering Date or within one year after the
applicable Exercise Date with respect to such shares. The Company may direct
that the certificates evidencing shares acquired pursuant to the Plan refer to
such requirement.
7.8 TAX WITHHOLDING
The Company shall be entitled to require payment in cash or deduction from
other compensation payable to each Participant of any sums required by federal,
state or local tax law to be withheld with respect to any purchase of shares of
Common Stock under the Plan or any sale of such shares.
7.9 GOVERNING LAW
The Plan and all rights and obligations thereunder shall be construed and
enforced in accordance with the laws of the Commonwealth of Massachusetts.
* * * * * *
I hereby certify that the foregoing PRI Automation, Inc. 2000 Employee Stock
Purchase Plan was duly approved by the Board of Directors of PRI
Automation, Inc. on .
I hereby certify that the foregoing PRI Automation, Inc. 2000 Employee Stock
Purchase Plan was duly approved by the stockholders of PRI Automation, Inc. on
.
Executed on the of .
______________________________________
SECRETARY
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APPENDIX C
PRI AUTOMATION, INC.
1994 EMPLOYEE STOCK PURCHASE PLAN
(AS AMENDED)
1. PURPOSE.
The PRI Automation, Inc. Employee Stock Purchase Plan (the "Plan") is
intended to provide a method whereby employees of PRI Automation, Inc. (the
"Company") will have an opportunity to acquire an ownership interest (or
increase an existing ownership interest) in the Company through the purchase of
shares of the Common Stock of the Company. It is the intention of the Company
that the Plan qualify as an "employee stock purchase plan" under Section 423 of
the Internal Revenue Code of 1986, as amended (the "Code"). The provisions of
the Plan shall, accordingly, be construed so as to extend and limit
participation in a manner consistent with the requirements of that section of
the Code.
2. DEFINITIONS.
(a) "Board" means the Board of Directors of the Company.
(b) "Code" shall have the meaning set forth in Paragraph 1.
(c) "Committee" means the Compensation Committee of the Board.
(d) "Common Stock" means the common stock, $.01 par value per share, of the
Company.
(e) "Company" shall also include any subsidiary of PRI Automation, Inc.
designated as a participant in the Plan by the Board, unless the context
otherwise requires.
(f) "Compensation" means, for the purpose of any Offering pursuant to this
Plan, base pay in effect as of the Offering Commencement Date (as hereinafter
defined). Compensation shall not include any deferred compensation other than
contributions by an individual through a salary reduction agreement to a cash or
deferred plan pursuant to Section 401(k) of the Code or to a cafeteria plan
pursuant to Section 125 of the Code.
(g) "Employee" means any person who is customarily employed at least
20 hours per week and more than five months in a calendar year by (i) the
Company or (ii) any subsidiary corporation.
(h) "Investment Accounts" shall have the meaning set forth in Paragraph 9.
(i) "Offering" shall have the meaning set forth in Paragraph 4.
(j) "Offering Commencement Date" shall have the meaning set forth in
Paragraph 4.
(k) "Offering Termination Date" shall have the meaning set forth in
Paragraph 4.
(l) "Plan" shall have the meaning set forth in Paragraph 1.
(m) "Subsidiary corporation" shall mean any present or future corporation
which is or would constitute a "subsidiary corporation" as that term is defined
in Section 425 of the Code.
3. ELIGIBILITY.
(a) Participation in the Plan is completely voluntary. Participation in any
one or more of the offerings under the Plan shall neither limit, nor require,
participation in any other offering.
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(b) Each employee of the Company shall be eligible to participate in the
Plan on the first Offering Commencement Date, as hereafter defined, his becoming
an employee. Notwithstanding the foregoing, no employee shall be granted an
option under the Plan:
(i) if, immediately after the grant, such employee would own stock,
and/or hold outstanding options to purchase stock, possessing 5% or more of
the total combined voting power or value of all classes of stock of the
Company or any subsidiary corporation; for purposes of this Paragraph the
rules of Section 425(d) of the Code shall apply in determining stock
ownership of any employee; or
(ii) which permits his rights to purchase stock under all Section 423
employee stock purchase plans of the Company and its subsidiary corporations
to exceed $25,000 of the fair market value of the stock (determined at the
time such option is granted) for each calendar year in which such option is
outstanding; for purposes of this Paragraph, the rules of Section 423(b)(8)
of the Code shall apply.
4. OFFERING DATES.
The right to purchase stock hereunder shall be made available by a series of
six-month offerings (the "Offering" or "Offerings") to employees eligible in
accordance with Paragraph 3 hereof. The Committee will, in its discretion,
determine the applicable date of commencement ("Offering Commencement Date") and
termination date ("Offering Termination Date") for each Offering. Participation
in any one or more of the Offerings under the Plan shall neither limit, nor
require, participation in any other Offering.
5. PARTICIPATION.
Any eligible employee may become a participant by completing a payroll
deduction authorization form provided by the Company and filing it with the
office of the Company's Treasurer 20 days prior to each applicable Offering
Commencement Date, as determined by the Committee pursuant to Paragraph 4.
6. PAYROLL DEDUCTIONS.
(a) At the time a participant files his authorization for a payroll
deduction, he shall elect to have deductions made from his pay on each payday
during any Offering in which he is a participant at a specified percentage of
his Compensation as determined on the applicable Offering Commencement Date;
said percentage shall be in increments of one percent up to a maximum percentage
of ten percent.
(b) Payroll deductions for a participant shall commence on the applicable
Offering Commencement Date when his authorization for a payroll deduction
becomes effective and shall end on the Offering Termination Date of the Offering
to which such authorization is applicable unless sooner terminated by the
participant as provided in Paragraph 10.
(c) All payroll deductions made for a participant shall be credited to his
account under the Plan. A participant may not make any separate cash payment
into such account.
(d) A participant may withdraw from the Plan at any time during the
applicable Offering period; provided, however, that a participant who is an
officer or director of the Company and who withdraws from the Plan during any
Offering period will not be eligible for the grant of any subsequent option
under the Plan for a period of six months.
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<PAGE>
7. GRANTING OF OPTION.
(a) Except as set forth in Paragraph 7(c) hereof, on the Offering
Commencement Date of each Offering, a participating employee shall be deemed to
have been granted an option to purchase a maximum number of shares of the Common
Stock equal to an amount determined as follows: 85% of the market value per
share of the Common Stock on the applicable Offering Commencement Date shall be
divided into an amount equal to the percentage of the employee's Compensation
which he has elected to have withheld (but no more than 10%) multiplied by the
employee's Compensation over the Offering period. Such market value per share of
the Common Stock shall be determined as provided in clause (i) of
Paragraph 7(b).
(b) The option price of the Common Stock purchased with payroll deductions
made during each such Offering for a participant therein shall be the lower of:
(i) 85% of the average of the bid and the asked prices as reported by
the National Association of Securities Dealers Automated Quotation
System, Inc. ("NASDAQ") in the Wall Street Journal, or, if the Common Stock
is designated as a national market security by the National Association of
Securities Dealers, Inc. ("NASD") the last trading price of the Common Stock
as reported by the NASDAQ National Market System in the Wall Street Journal,
or, if the Common Stock is listed on an exchange the closing price of the
Common Stock on the exchange on the Offering Commencement Date applicable to
such Offering (or on the next regular business date on which shares of the
Common Stock shall be traded in the event that no shares of the Common Stock
have been traded on the Offering Commencement Date); or if the Common Stock
is not quoted on NASDAQ, not designated as a NASDAQ national market security
and not listed on an exchange, 85% of the fair market value on the Offering
Commencement Date as determined by the Committee; and
(ii) 85% of the average of the bid and the asked prices as reported by
NASDAQ in the Wall Street Journal, or, if the Common Stock is designated as
a national market security by the NASD the last trading price of the Common
Stock as reported by the NASDAQ National Market System in the Wall Street
Journal, or, if the Common Stock is listed on an exchange the closing price
of the Common Stock on the exchange on the Offering Termination Date
applicable to such Offering (or on the next regular business date on which
shares of the Common Stock shall be traded in the event that no shares of
the Common Stock shall have been traded on the Offering Termination Date);
or if the Common Stock is not quoted on NASDAQ, not designated as a national
market security and not listed on an exchange, 85% of the fair market value
on the Offering Termination Date as determined by the Committee.
(c) A participant who is an officer or director of the Company and who
elects pursuant to Paragraph 8(a) with respect to any Offering not to exercise
an option deemed to have been granted pursuant to this Paragraph 7, shall not be
eligible for the grant of an option hereunder for a period of six months.
8. EXERCISE OF OPTION.
(a) Unless a participant gives written notice to the Treasurer of the
Company as hereinafter provided, his option for the purchase of Common Stock
with payroll deductions made during any Offering will be deemed to have been
exercised automatically on the Offering Termination Date applicable to such
Offering for the purchase of the number of full shares of Common Stock which the
accumulated payroll deductions in his account at that time will purchase at the
applicable option price (but not in excess of the number of shares for which
options have been granted the employee pursuant to Paragraph 7(a)), and any
excess in his account at that time will be automatically carried forward to the
next Offering unless the participant elects, by written notice to the Treasurer
of the Company, to have the excess returned to him.
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<PAGE>
(b) Fractional shares will not be issued under the Plan and any accumulated
payroll deductions which would have been used to purchase fractional shares
shall be automatically carried forward to the next Offering unless the
participant elects, by written notice to the Treasurer of the Company, to have
the excess cash returned to him.
9. INVESTMENT ACCOUNTS.
All shares of Common Stock purchased pursuant to Paragraph 8 shall be held
in separate investment accounts ("Investment Accounts") maintained by such
brokerage house, investment banking firm, commercial bank or other such similar
institution as may be selected by the Board for the participants. Each
Investment Account shall be in the name of the participating employee. All
dividends, if any, paid with respect to shares of Common Stock in a
participant's Investment Account shall be credited to his or her Investment
Account. Each participant shall have all of the rights and privileges of a
stockholder of the Company with respect to those shares purchased under the Plan
and held in his or her Investment Account.
10. WITHDRAWAL AND TERMINATION.
(a) Prior to the Offering Termination Date for an Offering, any participant
may withdraw the payroll deductions credited to his account under the Plan for
such Offering by giving written notice to the Treasurer of the Company. All of
the participant's payroll deductions credited to such account will be paid to
him promptly after receipt of notice of withdrawal, without interest, and no
future payroll deductions will be made from his pay during such offering. The
Company will treat any attempt to borrow by a participant on the security of
accumulated payroll deductions as an election to withdraw such deductions.
(b) Except as set forth in Paragraphs 6(d) and 7(c), a participant's
election not to participate in, or withdrawal from, any Offering will not have
any effect upon his eligibility to participate in any succeeding Offering or in
any similar plan which may hereafter be adopted by the Company.
(c) Upon termination of the participant's employment for any reason,
including retirement but excluding death, the payroll deductions credited to his
account will be returned to him, or, in the case of his death, to the person or
persons entitled thereto under Paragraph 14.
(d) Upon termination of the participant's employment because of death, his
beneficiary (as defined in Paragraph 14) shall have the right to elect, by
written notice given to the Company's Treasurer prior to the expiration of a
period of 90 days commencing with the date of the death of the participant,
either:
(i) to withdraw all of the payroll deductions credited to the
participant's account under the Plan; or
(ii) to exercise the participant's option for the purchase of stock on
the Offering Termination Date next following the date of the participant's
death for the purchase of the number of full shares which the accumulated
payroll deductions in the participant's account at the date of the
participant's death will purchase at the applicable option price (subject to
the limitation contained in Paragraph 7(a)), and any excess in such account
will be returned to said beneficiary. In the event that no such written
notice of election shall be duly received by the office of the Company's
Treasurer, the beneficiary shall automatically be deemed to have elected to
withdraw the payroll deductions credited to the participant's account at the
date of the participant's death and the same will be paid promptly to said
beneficiary.
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<PAGE>
11. INTEREST.
No interest will be paid or allowed on any money paid into the Plan or
credited to the account of any participating employee.
12. STOCK.
(a) The maximum number of shares of Common Stock available for issuance and
purchase by employees under the Plan, subject to adjustment upon changes in
capitalization of the Company as provided in Paragraph 17, shall be 520,000
shares of Common Stock, $.01 par value per share, of the Company. If the total
number of shares for which options are exercised on any Offering Termination
Date in accordance with Paragraph 8 exceeds the maximum number of shares for the
applicable Offering, the Company shall make a pro rata allocation of the shares
available for delivery and distribution in an equitable manner, with the
balances of payroll deductions credited to the account of each participant under
the Plan carried forward to the next Offering or returned to the participant if
he so chooses, by giving written notice to the Treasurer to this effect.
(b) The participant will have no interest in stock covered by his option
until such option has been exercised.
(c) The shares of stock purchased by a participant who is an officer or
director of the Company, or a beneficiary of a participant who was an officer or
director of the Company pursuant to Paragraph 14 hereof, at each Offering
Termination Date may not be sold or transferred by such participant or
beneficiary for a period of six months following such Offering Termination Date.
Certificates representing said shares of stock issued pursuant to this Plan may
bear legends to that effect.
13. ADMINISTRATION.
The Plan shall be administered by the Committee. The interpretation and
construction of any provision of the Plan and adoption of rules and regulations
for administering the Plan shall be made by the Committee. Determinations made
by the Committee with respect to any matter or provision contained in the Plan
shall be final, conclusive and binding upon the Company and upon all
participants, their heirs or legal representatives. Any rule or regulation
adopted by the Committee shall remain in full force and effect unless and until
altered, amended, or repealed by the Committee.
14. DESIGNATION OF BENEFICIARY.
A participant shall file with the Treasurer of the Company a written
designation of a beneficiary who is to receive any Common Stock and/or cash
under the Plan. Such designation of beneficiary may be changed by the
participant at any time by written notice. Upon the death of a participant and
upon receipt by the Company of proof of the identity and existence at the
participant's death of a beneficiary validly designated by him under the Plan,
the Company shall deliver such Common Stock and/or cash to such beneficiary. In
the event of the death of a participant and in the absence of a beneficiary
validly designated under the Plan who is living at the time of such
participant's death, the Company shall deliver such Common Stock and/or cash to
the executor or administrator of the estate of the participant. No beneficiary
shall prior to the death of the participant by whom he has been designated,
acquire any interest in the Common Stock and/or cash credited to the participant
under the Plan.
15. TRANSFERABILITY.
Neither payroll deductions credited to a participant's account nor any
rights with regard to the exercise of an option or to receive Common Stock under
the Plan may be assigned, transferred, pledged, or otherwise disposed of in any
way by the participant other than by will or the laws of descent and
distribution. Any such attempted assignment, transfer, pledge, or other
disposition shall be
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without effect, except that the Company may treat such act as an election to
withdraw funds in accordance with Paragraph 8(b).
16. USE OF FUNDS.
All payroll deductions received or held by the Company under this Plan may
be used by the Company for any corporate purpose, and the Company shall not be
obligated to segregate such payroll deductions.
17. EFFECT OF CHANGES OF COMMON STOCK.
If the Company shall subdivide or reclassify the Common Stock which has been
or may be optioned under this Plan, or shall declare thereon any dividend
payable in shares of such Common Stock, or shall take any other action of a
similar nature affecting such Common Stock, then the number and class of shares
of Common Stock which may thereafter be optioned (in the aggregate and to any
participant) shall be adjusted accordingly and in the case of each option
outstanding at the time of any such action, the number and class of shares which
may thereafter be purchased pursuant to such option and the option price per
share shall be adjusted to such extent as may be determined by the Committee,
with the approval of independent public accountants and counsel, to be necessary
to preserve the rights of the holder of such option.
18. AMENDMENT OR TERMINATION.
The Board may at any time terminate or amend the Plan. No such termination
shall affect options previously granted, nor may an amendment make any change in
any option theretofore granted which would adversely affect the rights of any
participant holding options under the Plan.
19. NOTICES.
All notices or other communications by a participant to the Company under or
in connection with the Plan shall be deemed to have been duly given when
received by the Treasurer of the Company.
20. MERGER OR CONSOLIDATION.
If the Company shall at any time merge into or consolidate with another
corporation, the holder of each option then outstanding will thereafter be
entitled to receive at the next Offering Termination Date upon the exercise of
such option for each share as to which such option shall be exercised, the
securities or property which a holder of one share of the Common Stock was
entitled to upon and at the time of such merger or consolidation. In accordance
with this Paragraph and Paragraph 17, the Committee shall determine the kind and
amount of such securities or property which such holder of an option shall be
entitled to receive. A sale of all or substantially all of the assets of the
Company shall be deemed a merger or consolidation for the foregoing purposes.
21. APPROVAL OF STOCKHOLDERS.
The Plan is subject to the approval of the stockholders of the Company at
their next annual meeting or at any special meeting of the stockholders for
which one of the purposes of such a special meeting shall be to act upon the
Plan.
22. GOVERNMENTAL AND OTHER REGULATIONS.
The Plan, and the grant and exercise of the rights to purchase shares
hereunder, and the Company's obligation to sell and deliver shares upon the
exercise of rights to purchase shares, shall be subject to all applicable
federal, state and foreign laws, rules and regulations, and to such approvals by
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any regulatory or governmental agency as may, in the opinion of counsel for the
Company, be required. The Plan shall be governed by, and construed and enforced
in accordance with, the provisions of Sections 421, 423 and 424 of the Code and
the substantive laws of the Commonwealth of Massachusetts. In the event of any
inconsistency between such provisions of the Code and any such laws, said
provisions of the Code shall govern to the extent necessary to preserve
favorable federal income tax treatment afforded employee stock purchase plans
under Section 423 of the Code.
* * *
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<PAGE>
PRI AUTOMATION, INC.
805 MIDDLESEX TURNPIKE, BILLERICA, MASSACHUSETTS 01821
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 10, 2000
The undersigned hereby constitutes and appoints Mordechai Wiesler, Mitchell
G. Tyson and Robert L. Birnbaum, 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 voting capital stock of PRI Automation, Inc. (the
"Company") held of record by the undersigned at the close of business on
January 20, 2000 at the Annual Meeting of Stockholders of PRI to be held at
the offices of Foley, Hoag & Eliot LLP, One Post Office Square, Boston,
Massachusetts on March 10, 2000 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 THROUGH 4, 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?
- ---------------------------------- ----------------------------------------
- ---------------------------------- ----------------------------------------
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
PRI AUTOMATION, INC.
<PAGE>
<TABLE>
<S> <C>
1. Proposal to elect the With- For All
following nominees as For Hold Except
directors of the Company: [_] [_] [_]
</TABLE>
MORDECHAI WIESLER, MITCHELL G. TYSON, AMRAM RASIEL, BORUCH
B. FRUSZTAJER, ALEXANDER V. D'ARBELOFF, AND KENNETH M.
THOMPSON
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE, MARK THE "FOR ALL EXCEPT" BOX AND STRIKE
A LINE THROUGH THAT NOMINEE'S NAME.
<TABLE>
<S> <C>
2. Proposal to approve the For Against Abstain
2000 Stock Option Plan [_] [_] [_]
3. Proposal to approve the
2000 Employee Stock Purchase
Plan and the amendment of the 1994 For Against Abstain
Employee Stock Purchase Plan [ ] [ ] [ ]
4. Proposal to amend the articles of
organization to increase the
number of authorized shares of
common stock, from 50,000,000 For Against Abstain
shares to 75,000,000 shares [ ] [ ] [ ]
</TABLE>
RECORD DATE SHARES:
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:
<PAGE>
Please take note of the important information enclosed with this proxy card
related to the management and operation of your Company.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the appropriate box on this proxy card to indicate how your shares
will 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 March 10, 2000.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
PRI Automation, Inc.
