<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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 Rule 14a-11(c) or Rule 14a-12
</TABLE>
CHICAGO MINIATURE LAMP, 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:
(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> 2
CHICAGO MINIATURE LAMP, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 29, 1997
To the Shareholders of Chicago Miniature Lamp, Inc.:
The Annual Meeting of Shareholders of Chicago Miniature Lamp, Inc.
(the "Company") will be held at the offices of CML Fiberoptics, Inc., 45
Bartlett Street, Marlborough, Massachusetts on April 29, 1997, at 11:00 a.m.
for the following purposes:
1. To elect seven directors to hold office until the 1998 Annual
Meeting of Shareholders and until their successors have been
duly elected and qualified;
2. To consider and act upon a proposal to ratify the appointment
of Ernst & Young LLP as independent accountants of the Company
for the year ending November 30, 1997; and
3. To transact such other business as may properly come before
the meeting or any adjournment thereof.
Shareholders of record as of the close of business on March 20, 1997,
will be entitled to vote at this meeting or any adjournment thereof.
Information relating to the matters to be considered and voted on at the Annual
Meeting is set forth in the proxy statement accompanying this Notice.
By Order of the Board of Directors,
/s/ Ronald S. Goldstein
-----------------------------------
Ronald S. Goldstein
Secretary
March 27, 1997
IF YOU DO NOT EXPECT TO ATTEND THE MEETING IN PERSON, PLEASE VOTE ON
THE MATTERS TO BE CONSIDERED AT THE MEETING BY COMPLETING THE ENCLOSED PROXY
AND MAILING IT PROMPTLY IN THE ENCLOSED ENVELOPE.
<PAGE> 3
CHICAGO MINIATURE LAMP, INC.
500 CHAPMAN STREET
CANTON, MASSACHUSETTS 02021
---------
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation
of proxies on behalf of the Board of Directors of Chicago Miniature Lamp, Inc.
(the "Company") for the Annual Meeting of Shareholders to be held at the
offices of CML Fiberoptics, Inc., 45 Bartlett Street, Marlborough,
Massachusetts on April 29, 1997, at 11:00 a.m., or any adjournment thereof.
If the accompanying proxy form is completed, signed and returned, the
shares represented thereby will be voted at the meeting. The giving of the
proxy does not affect the right to vote in person should the shareholder be
able to attend the meeting. The shareholder may revoke the proxy at any time
prior to the voting thereof.
The annual report of the Company for the year ended December 3, 1996,
is being mailed with this proxy statement to shareholders entitled to vote at
the meeting. The cost of the proxy solicitation will be paid by the Company.
SHAREHOLDERS ENTITLED TO VOTE
AND
PRINCIPAL SHAREHOLDERS
The only voting securities of the Company are common shares.
Shareholders of record as of the close of business on March 20, 1997, are
entitled to notice of and to vote at the Annual Meeting. As of March 20, 1997,
there were 19,457,249 shares of Common Stock outstanding, each share being
entitled to one vote.
The affirmative vote of the holders of a majority of the votes cast at
the meeting is necessary for the election of directors and the ratification of
the selection of auditors. The approximate date on which this proxy statement
and the proxy form were first sent to shareholders was March 27, 1997.
The following table sets forth certain information regarding those
persons known to management to hold beneficially at least 5% of the outstanding
shares of Common Stock of the Company and the ownership by all executive
officers and directors as a group.
<PAGE> 4
<TABLE>
<CAPTION>
Amount of Percent
Name and Address of Beneficial Owner Beneficial Ownership(l) of Class
- ------------------------------------ ----------------------- --------
<S> <C> <C>
Frank M. Ward . . . . . . . . . . . . . . . . . . . 10,106,570(2) 51.7%
individually and as trustee
500 Chapman Street
Canton, MA 02021
All executive officers and directors
as a group (8 persons) . . . . . . . . . . . . . 10,547,354 53.7%
</TABLE>
- -------------------
(1) Includes shares underlying options which are exercisable or exercisable
within sixty (60) days from the date of this Proxy Statement.
(2) Includes 7,755,570 shares owned by Frank M. Ward and Eileen M. Ward as
joint tenants with right of survivorship, 500,000 shares owned by Frank
M. Ward GRAT Trust, of which Mr. Ward is one of two Trustees, and
1,851,030 shares owned by Frank M. Ward, as trustee under certain trust
agreements for each of his five children dated May 23, 1995 (the "Trust
Agreements"). The Trust Agreements terminate upon each child reaching
the age of 35 (the first of such trusts Will terminate in 2005).
ELECTION OF DIRECTORS
PROXIES IN THE ACCOMPANYING FORM WILL BE VOTED AT THE MEETING, UNLESS
AUTHORITY TO DO SO IS WITHHELD, IN FAVOR OF THE ELECTION AS DIRECTORS OF THE
NOMINEES NAMED BELOW.
It is proposed that the shareholders elect seven directors. The term
of each director elected will be until the next Annual Meeting of Shareholders
or until his successor is duly elected and qualified. It is intended that the
proxies will be voted for the nominees listed below and cannot be voted for
more than seven nominees. Each nominee is at present available for election,
but if any nominee should become unavailable, the persons voting the
accompanying proxy may, at their discretion, vote for a substitute. Certain
information concerning the nominees is set forth below.
<TABLE>
<CAPTION>
COMMON STOCK
SERVED BENEFICIALLY OWNED AS OF
AS MARCH 20, 1997(1)
DIRECTOR -----------------
NAME AGE SINCE NO. SHARES % SHARES
---- --- ----- ---------- --------
<S> <C> <C> <C> <C>
Frank M. Ward 52 1992 10,106,570(2) 51.7
Werner Arnold 43 1996 170,000 *
Donald S. Dewsnap 62 1995 13,950 *
Michael J. Giani 68 1995 27,000 *
Ronald S. Goldstein 48 1995 111,757 *
Richard E. Ingram 55 1996 23,500 *
Thomas L. Kanaya 59 1995 69,149 *
</TABLE>
- -------------------
* Less than 1%
(1) Includes shares underlying options which are exercisable or
exercisable within sixty (60) days from the date of this Proxy
Statement.
2
<PAGE> 5
(2) Includes 7,755,570 shares owned by Frank M. Ward and Eileen M. Ward as
joint tenants with right of survivorship, 500,000 shares owned by
Frank M. Ward GRAT Trust, of which Mr. Ward is one of two Trustees,
and 1,851,030 shares owned by Frank M. Ward, as trustee under the
Trust Agreements for each of his five children.
Frank M. Ward has served as President, Chief Executive Officer and
Director of the Company and Xenell since 1985. Prior to 1985, Mr. Ward was
President of Xenell Marketing Corporation, an organization formed to manage the
product development, marketing and distribution of the products of Xenell. Mr.
Ward received a Bachelor of Science degree in Electrical Engineering from
Northeastern University and has completed post graduate studies in physics and
metallurgy.
Werner A. Arnold is the President of CML-Alba, a subsidiary of the
Company formed in May 1996 to consummate the acquisition of W. Albrecht GmbH
u. Co KG and its interest in certain other affiliated entities (the "Alba
Acquisition"). From 1994 to 1996, Mr. Arnold served as President and Chief
Executive Officer of Alba-Germany. From 1985 to 1993, he served as General
Manager and Executive Vice President of Engineering, Sales and Marketing of
Alba. Mr. Arnold also served as an officer and director of certain affiliates
of Alba. Mr. Arnold has a Masters in Engineering from Technical University of
Munich, Germany. W. Arnold was elected as a Director of the Company in June
1996.
Donald S. Dewsnap has been Chairman of Norlico Corp. since 1977, a
supplier of engineered chemical dispense systems to industrial users. Prior
thereto he was involved in industrial research at Arthur D. Little Corp. and
spent fourteen years with GTE Sylvania Lighting Division in various product
marketing, management and sales engineering positions. Mr. Dewsnap was elected
a director of the Company in March 1995. W. Dewsnap holds a Bachelor of Arts
degree from Merrimack College.
Michael J. Giani is a Vice President of EDL a subsidiary of the
Company acquired in 1994. Since joining IDI in 1974, Mr. Giani has served in
various capacities including Director, Vice President and Secretary of IDI. As
Vice President of IDI, Mr. Giani's responsibilities have included operations
and purchasing. W. Giani is presently responsible for special projects at IDI.
Mr. Giani was elected as a Director of the Company in September 1995.
Ronald S. Goldstein has served as Chief Financial Officer and
Secretary of the Company since September 1995. Mr. Goldstein is a Certified
Public Accountant and, prior to joining the Company, served as a principal in
the accounting firm of R. J. Gold & Co., which is located in Needham,
Massachusetts. Prior to joining R. J. Gold & Co., Mr. Goldstein was a
shareholder, officer and director of Greenfield, Goldstein, Green & Berger.
Such companies served as the outside accountant for the Company from 1978 to
1994. Mr. Goldstein was elected a director of the Company in March 1995. Mr.
Goldstein received a Bachelor of Science in Accounting and a Masters of
Business Administration from Boston University.
Richard E. Ingram has been the Chairman of the Board of Builder Marts
of America, Inc., a national distributor of lumber and building materials,
since November 1988, and he was its Chief Executive Officer until November
1993. He was a founding director of Carolina First Corporation, the holding
company for Carolina First Bank, and Ingram Enterprises, Inc., a real estate
development and investment banking company. He is also a director of Synalloy
Corporation, Columbia Lumber, a retail lumber business, and Tel-Pan
Communications, Inc., a long distance provider in Panama. He has served on the
Policy Advisory Board of the Joint Center for Urban Studies at Harvard
University. Mr. Ingram is a graduate of the American Institute of Banking and
the
3
<PAGE> 6
University of North Carolina Executive Program. Mr. Ingram was elected a
director of the Company effective August 1, 1996.
Thomas L Kanaya has been Vice President of International Operations
for the Company and Xenell since 1987. His primary responsibility is
purchasing component parts from the Pacific Rim and maintaining a relationship
with the Pacific Rim suppliers. Prior to his employment with the Company, he
was President of Asahi International, a primary supplier of lighting materials
to the United States and Europe. He was elected as a director of the Company
in March 1995. Mr. Kanaya earned his degree in Business from the Hokkaido
University of Education, Hokkaido, Japan.
The Company currently pays its non-employee and non-affiliated
directors an annual fee of $10,000 for attendance at meetings of the Board of
Directors or committees thereof. All directors are reimbursed for their
reasonable expenses in connection with the performance of their duties.
The Board of Directors held eight meetings during the year ended
December 1, 1996. The current standing committees of the Board of Directors
are the Audit Committee, the Compensation Committee and the Stock Option
Committee. The Audit Committee met once, the Compensation Committee met once
and the Stock Option Committee met four times during the year ended December 1,
1996. All directors attended at least 75% of the meetings held during the year
ended December 1, 1996 (during the period for which each was a director).
Each of the following officers and/or directors failed to file reports
with the Securities and Exchange Commission (the "Commission") pursuant to
Section 16(a) of the Securities Exchange Act of 1934, as amended, on a timely
basis: Werner Arnold, a director of the Company, filed one delinquent report
reflecting two transactions; Michael J. Giani, a director of the Company,
filed one delinquent report reflecting one transaction; Ronald S. Goldstein, a
director of the Company, filed one delinquent report reflecting three
transactions; Donald J. MacCrindle, Executive Vice President of the Company,
filed two delinquent reports reflecting two transactions; and Richard F.
Parenti, Vice President - Finance and Chief Accounting Officer of the Company,
filed two delinquent reports reflecting three transactions.
COMMITTEES
The Board of Directors has established a Compensation Committee, a
Stock Option Committee and an Audit Committee. The members of the Compensation
Committee and the Stock Option Committee are Donald S. Dewsnap and Richard E.
Ingram. The Compensation Committee reviews general policy matters relating to
compensation and benefits of employees generally and has responsibility for
reviewing and approving compensation and benefits for all executive officers of
the Company. The Stock Option Committee administers the Company's Stock Option
Plan and recommends grants of the specific options under the Stock Option Plan.
The members of the Audit Committee are Ronald S. Goldstein, Donald S.
Dewsnap and Richard E. Ingram. The Audit Committee has general responsibility
for accounting and audit activities of the Company and its subsidiaries. The
Audit Committee annually reviews the qualifications of the independent
certified public accountants, makes recommendations to the Board as to their
selection, reviews the scope, fees and results of their audit and approves
their non-audit services and related fees. The Audit Committee meets
periodically with management and with the Company's independent auditors to
determine the adequacy of internal controls and other financial reporting
matters.
4
<PAGE> 7
EXECUTIVE COMPENSATION
The following tables set forth certain information relating to the
compensation earned by the Chief Executive Officer of the Company and each of
the other most highly compensated executive officers of the Company whose total
cash compensation for the year indicated exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
---------------------
AWARDS
ANNUAL COMPENSATION ---------------------
------------------- SECURITIES UNDERLYING
YEAR SALARY($) OPTIONS(#)
----- ------------------- ---------------------
<S> <C> <C> <C>
Frank M. Ward
President and Chief Executive Officer . . . 1996 $ 324,000
1995 $ 360,000 ---
1994(l) $2,000,000 ---
Donald J. MacCrindle
Executive Vice President . . . . . . . . 1996 $ 134,481 ---
1995 $ 112,538 30,000
1994(l) $ 73,957 ---
Ronald S. Goldstein
Chief Financial Officer . . . . . . . . 1996 $ 140,769 75,000
</TABLE>
- -------
(1) For the nine-month period ended November 27, 1994.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF STOCK
PRICE APPRECIATION
INDIVIDUAL GRANTS(1) FOR OPTION TERM(2)
----------------------------------------------- ----------------------
% OF
NUMBER OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE
OPTIONS EMPLOYEES PRICE EXPIRATION
NAME GRANTED(#) IN YEAR ($/SHARE) DATE 5%($) 10%($)
- ---- ---------- ------- --------- ---- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Ronald S. Goldstein 30,000 17.24% $13.67 12/4/05 $257,900 $653,600
</TABLE>
(1) All options were granted at an exercise price equal to the fair market
value of the Company's Common Stock on the date of grant. Options are
100% vested as of December 1, 1996 and terminate ten years from the
date of grant.
(2) The assumed annual rates of appreciation of 5% and 10% would result in
the price of the Company's stock increasing to $22.26 and $35.45,
respectively.
5
<PAGE> 8
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
NUMBER UNDERLYING VALUE OF UNEXERCISED
OF SHARES VALUE UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
NAME ACQUIRED REALIZED YEAR-END YEAR-END($)(1)
---- -------- -------- ---------------------- -----------------------
<S> <C> <C> <C> <C>
Donald J. MacCrindle 9,300 $211,575 5,700 $129,675 Exercisable
5,000 $125,850 10,000 $251,700 Unexercisable
Ronald S. Goldstein --- --- 75,000 $1,607,490 Exercisable
</TABLE>
(1) Calculated based on the last reported sales price of $33.50 per share
of Common Stock as reported on the Nasdaq National Market on December
1, 1996.
EMPLOYMENT AGREEMENT
In December 1994, the Company entered into a three-year employment
agreement with Mr. Ward. The agreement provided for a salary of $360,000,
$420,000 and $480,000 for fiscal years 1995 through 1997, respectively. At the
request of Mr. Ward, the employment agreement has been amended to reduce his
salary to $250,000 for each of the fiscal years 1996 and 1997. The agreement
also provides for the reimbursement of Mr. Ward's reasonable and necessary
expenses in carrying out his duties as Chief Executive Officer, including an
automobile and related expenses. Under the agreement, Mr. Ward is also
entitled to receive all employee benefits under any retirement, pension,
profit-sharing, insurance and other plans that are in effect or that may be
later adopted. In the event of any disability that renders Mr. Ward incapable
of performing his normal duties with the Company that continues for a period of
one year, the Company may, at its option, terminate the employment contract.
In connection with the Alba Acquisition, the Company entered into
three-year employment agreements with Mr. Werner A. Arnold and Mr. Daniel S.
Savocchia. After the first three-year term, the agreements can be extended
annually for additional one-year terms. Mr. Arnold will be paid an annual
salary of DM 225,000 and has received stock options to purchase an aggregate of
75,000 shares of Common Stock, which options have an exercise price of $24.33
per share and vest at the rate of 20% per year commencing May 30, 1997. Mr.
Savocchia will be paid an annual salary of $100,000 and will receive a car
allowance of $450 per month. Mr. Savocchia has received stock options to
purchase an aggregate of 30,000 shares of Common Stock, which options have an
exercise price of $24.33 per share and vest at the rate of 20% per year
commencing May 30, 1997. The agreement with Mr. Arnold also provides for
reimbursement of reasonable and necessary business expenses. Under the
employment agreements, Messrs. Arnold and Savocchia are entitled to receive all
employee benefits, rights and privileges under any retirement, pension,
profit-sharing, insurance, hospital or other plans that may now be in effect or
that may be later adopted. In the event of disability that renders either Mr.
Arnold or Mr. Savocchia incapable of performing his normal duties for a period
of six consecutive months, the Company may terminate such employee's employment
by giving him notice in writing. In the event of such termination, Mr.
Savocchia is entitled to (i) his then-current salary for the six-month period
commencing with such disability or (ii) the unexpired term of his employment,
whichever is less. Each employment agreement is also terminable by either
party for cause. The agreements also contain non-compete clauses that prohibit
Messrs. Arnold and
6
<PAGE> 9
Savocchia from competing with the Company for a period of five years following
termination of their employment with the Company.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Prior to the creation of the Compensation Committee on March 27, 1995,
executive compensation decisions were made by the Company's Chief Executive
Officer, Frank M. Ward. During the entire period from the beginning of fiscal
1995 through March 27, 1995, Mr. Ward was employed under the employment
agreement described under the summary compensation table and Mr. Ward did not
participate in any executive compensation decisions affecting himself, although
he did request that his salary be reduced to $250,000 for fiscal years 1996 and
1997.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Introduction
Under rules of the Commission the Company is required to provide
certain information concerning compensation provided to the Company's President
and Chief Executive Officer and the other executive officers of the Company.
The disclosure requirements for the executive officers include the use of
tables and a report of the Committee responsible for compensation decisions for
the named executive officers, explaining the rationale and considerations that
led to those compensation decisions. Therefore, the Compensation Committee of
the Board of Directors has prepared the following report for inclusion in this
Proxy Statement.
Compensation Committee Role
The Compensation Committee of the Board of Directors was created on
March 27, 1995. Since that date, the Compensation Committee has been
responsible for making recommendations to the Board of Directors concerning the
salaries of executive officers. The Committee is also responsible for
overseeing other forms of compensation and benefits to other senior officers.
The Committee's responsibilities include reviewing salaries, benefits and other
compensation of senior officers and making recommendations to the full Board of
Directors with respect to these matters.
Compensation Philosophy
The compensation philosophy for executive officers conforms to the
compensation philosophy of the Company generally for all employees. The
Company's compensation is designed to:
- provide compensation comparable to that offered by companies
with similar businesses, allowing the Company to successfully
attract and retain the employees necessary to its long-term
success;
- provide compensation which relates to performance of the
individual and is based upon individual performance;
- provide incentive compensation that varies directly with both
Company performance and individual contribution to that
performance; and
7
<PAGE> 10
- provide an appropriate linkage between compensation and the
creation of shareholder value through awards tied to the
Company's performance and through facilitating employee stock
ownership.
Executive Officers Compensation Program
The Company's executive officers' compensation program is comprised of
base salary, cash bonuses based upon individual performance and long-term
incentive compensation in the form of stock options under the Stock Option
Plan, which options are recommended by the Stock Option Committee. In
addition, the Company's executive officers receive various other benefits,
including medical benefits, which are generally available to the employees of
the Company.
Base Salary and Bonus Awards
The Compensation Committee reviews the salaries of the executive
officers of the Company annually. The Committee made salary decisions about
the executive officers based upon a variety of considerations in conformance
with the compensation philosophy stated above. First, salaries are
competitively set relative to companies with similar businesses to that of the
Company. Second, the Committee considered the performance of the individual
executive officer with respect to the areas under his or her responsibility,
including an assessment of the value of each to the Company. Third, internal
equity among employees was factored into the decision. Finally, the
Compensation Committee considered the Company's financial performance and its
ability to absorb any increases in salaries.
The salary of the Chief Executive Officer, Frank M. Ward, is
established by an employment agreement entered into in December 1994. The
employment agreement provided for an annual salary of $360,000 for fiscal year
1995, $420,000 for fiscal year 1996 and $480,000 for fiscal year 1997. Upon
the request of Mr. Ward, the employment agreement has been amended to reduce
Mr. Ward's salary to $250,000 for each of the fiscal years 1996 and 1997. He
also received employee health benefits and automobile and expense allowances.
Further, Mr. Ward received a bonus of $75,000 for the fiscal 1996. Mr. Ward
received no stock option grants during the year. While the salary is set by
agreement and is not subject to the discretion of the Compensation Committee,
the Committee believes that the aggregate of salary and bonus is reasonable
based upon his responsibilities, the revenue size of the Company, profitability
of Company, growth and other factors when compared to chief executive officers
of similar companies.
Other than Mr. Ward, Donald J. MacCrindle, Executive Vice President
and Ronald S. Goldstein, Chief Financial Officer and Secretary, were the only
other executive officers receiving compensation exceeding $100,000. Other than
Mr. Ward, no cash bonuses were awarded to any executive officer or employee,
although the Compensation Committee will consider such bonuses in the future on
a discretionary basis for extraordinary performance or accomplishments. Based
upon surveys available to the Compensation Committee, the Committee believes
that the salaries of the executive officers and senior employees of the Company
are reasonable when compared to individuals with similar responsibilities at
comparable companies.
Stock Option Awards
The Company maintains a Stock Option Plan which is designed to align
executive officers' and shareholders' interests in the enhancement of
shareholder value. Stock options are granted upon the recommendation of the
Stock Option Committee with the approval of the disinterested members of the
Board.
8
<PAGE> 11
Executive officers and others are eligible to receive options under these
plans. The Compensation Committee strongly believes that the interests of
shareholders and executives become more closely aligned when such executives
are provided an opportunity to acquire a proprietary interest in the Company
through ownership of the Company's Common Stock. Accordingly, key employees of
the Company, including executive officers, as part of their overall
compensation package, are eligible for participation in the Company's Stock
Option Plan, whereby they are granted options exercisable at no less than fair
market value on the date of grant. Because no benefit is received unless the
Company's stock price performs favorably, awards under the Stock Option Plan
are intended to provide incentives for executive officers to enhance long-term
Company performance, as reflected in stock price appreciation, thereby
increasing shareholder value.
The stock option grants are principally based on overall consolidated
results of the Company, achievement of Company objectives, individual
performance, including managerial effectiveness, initiative and team work, and
are in such amounts that reflect what the Stock Option Committee believes are
necessary to attract, retain and motivate senior management and other key
employees. The members of the Stock Option Committee and the Compensation
Committee are the same, and stock option awards are considered in the package
of the key employees. The Compensation Committee believes that stock option
awards are rewards for past growth and the incentive for continued growth.
COMPENSATION COMMITTEE
Donald S. Dewsnap
Richard Ingram
Date: March 25, 1997
The report of the Compensation Committee shall not be deemed
incorporated by reference by any general statement incorporating by reference
this proxy statement into any filing under the Securities Act of 1933 or under
the Securities Act of 1934 (together, the "Acts"), except to the extent that
the Company specifically incorporates this information by reference, and shall
not otherwise be deemed filed under such Acts.
9
<PAGE> 12
STOCK PRICE PERFORMANCE GRAPH
The following graph presents a comparison of the cumulative total
shareholder return on the Company's Common Stock with the NASDAQ Stock Market
(U.S.) Index and a Peer Group Composite. This graph assumes that $100 was
invested as of the close of markets on June 16, 1995, the date of the Company's
initial public offering, in the Company's Common Stock and in the indices, and
that all dividends were reinvested. The stock price performance shown below is
not necessarily indicative of future price performance.
[GRAPH]
<TABLE>
<CAPTION>
June 16, 1995 December 3, 1995 December 1, 1996
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Chicago Miniature Lamp, Inc. $100.00 $136.67 $334.98
- ----------------------------------------------------------------------------------------------------
Nasdaq Stock Market (U.S.) Index $100.00 $116.14 $142.26
- ----------------------------------------------------------------------------------------------------
Peer Group Composite(1) $100.00 $ 99.99 $123.47
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) Peer Group Composite includes the stock of nine companies selected for
comparison purposes.
The stock price performance graph shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Acts except to the extent that the Company
specifically incorporates this information by reference, and shall not
otherwise be deemed filed under the Acts.
10
<PAGE> 13
CERTAIN TRANSACTIONS
The Company leases on a month-to-month basis approximately 2,200 sq.
ft. of office space in Canton, Massachusetts from Frank M. Ward, the President,
Chief Executive Officer and a director of the Company. Rent expense on this
facility was $45,000 for the nine-months ended November 27, 1994, $60,000 for
the fiscal year ended December 3, 1995 and $67,000 for the year ended December
1, 1996, respectively. Management believes the rent to be comparable to the
rent that would be paid to an unrelated party.
In February 1994, the Company purchased its manufacturing facility
located in Pauls; Valley, Oklahoma from Mr. Ward for $575,000. The facility
had been previously leased from Mr. Ward for $205,000 and $190,000 for the
fiscal years ended February 28, 1993, and February 27, 1994, respectively. The
purchase price equaled the approximate depreciated historical cost to Mr. Ward
as of the sale date. Management believes that such price was less than its
fair market value at such time. Also, in February 1994, Mr. Ward sold to the
Company for $141,000 certain machinery and equipment that he had purchased in
1991. The sale price equaled Mr. Ward's cost. The Company financed the
purchase of the property and equipment by issuing a promissory note payable to
Mr. Ward. This note has been paid in full.
A portion of the net proceeds of the Company's initial public offering
on June 16, 1995 was used to pay $17.5 million of the outstanding indebtedness
under the Company's Amended and Restated Credit Agreement, thereby reducing the
obligation of Frank M. Ward under his guaranty of such indebtedness. The
Amended and Restated Credit Agreement has been further amended following the
Company's initial public offering, and W. Ward's guaranty has been released.
At December 1, 1996, Mr. Frank M. Ward owed the Company $515,000 for
advances made to him or payments made on his behalf. Such amount was repaid by
Mr. Ward in March, 1997.
Ronald S. Goldstein, the Chief Financial Officer and a director of the
Company, is a Certified Public Accountant and, during a part of fiscal 1995,
was a principal in the accounting firm of R. J. Gold & Co. For the fiscal year
ended December 3, 1995, R. J. Gold & Co. was paid approximately $138,000 for
accounting services. In addition, on January 3, 1995, the Company issued to
Mr. Goldstein 14,153 shares of its Common Stock for consulting services
rendered by him. The shares were valued at such time at approximately $4.24
per share or $60,000. For the year ended February 1994, the Company paid
accounting fees of approximately $63,000 to an accounting firm with whom Mr.
Goldstein was associated.
Mr. Werner A. Arnold, President of CML-Alba and a director of the
Company, together with his wife and her father (collectively, the "Arnold
Family") were the direct or indirect owners of Alba, and they sold their
ownership interests in Alba to the Company in May 1996. In connection with the
Alba Acquisition, and certain affiliated entities, the Company paid to the
Arnold Family approximately DM 13.1 million (or approximately $8.5 million) in
cash, assumed certain liabilities totaling approximately DM 7.5 million (or
approximately $4.9 million) and issued 150,000 shares of the Company's Common
Stock (valued at approximately $21.67 per share or $3.3 million).
11
<PAGE> 14
INDEPENDENT PUBLIC ACCOUNTANTS
The Certified Public Accounting firm of Ernst & Young LLP, the
Company's independent accountants for 1996, has been selected as the Company's
independent accountants for 1997. A representative of that accounting firm
will be present at the meeting with the opportunity to make a statement and
respond to appropriate questions.
The Board of Directors recommends a vote "FOR" ratification of the
appointment of Ernst & Young LLP as the Company's independent accountants for
the fiscal year ending November 30, 1997.
On November 10, 1995, the Registrant changed its independent
accountants from Arthur Andersen LLP to Ernst & Young LLP. The change was
recommended by the Audit Committee following a review of competitive proposals
submitted by the accounting firms and the Board of Directors approved the
change. Arthur Andersen LLP was dismissed on November 10, 1995 and Ernst &
Young LLP was engaged effective November 15, 1995. Ernst & Young LLP completed
the audits of the Registrant's financial statements for the fiscal years ended
December 3, 1995 and December 1, 1996.
Arthur Andersen LLP served as the Registrant's independent accountants
for the two most recent fiscal years prior to the change. During those periods
and all subsequent interim periods preceding the change of accountants, Arthur
Andersen's reports on the financial statements of the Registrant contained no
adverse opinions or disclaimers of opinion and were not qualified or modified
as to uncertainty, audit scope or accounting principles. Likewise, during
those periods and at all times prior to the change, there were no disagreements
with Arthur Andersen LLP on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure, which, if not
resolved to the satisfaction of Arthur Andersen LLP, would have caused it to
make a reference to the matter in connection with any of its reports.
OTHER MATTERS
The management has no information that any other matters will be
brought before the meeting. If, however, other matters do come before the
meeting, it is the intention of the persons named in the Proxy in accordance
with their best judgment, discretionary authority to do so being included in
the Proxy.
SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
In order to be included in the proxy materials for the 1998 Annual
Meeting of Shareholders of the Company, shareholder proposals must be received
by the Company not later than January 1, 1998.
CHICAGO MINIATURE LAMP, INC.
By /s/ Ronald S. Goldstein
-------------------------------------
Ronald S. Goldstein, Secretary
Date: March 27, 1997
12
<PAGE> 15
APPENDIX
CHICAGO MINIATURE LAMP, INC.
500 CHAPMAN STREET
CANTON, MA 02021
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Frank M. Ward and Ronald S. Goldstein
with the power to appoint their substitute, and hereby authorized them to
represent and vote, as designated below, all the shares of common stock of
Chicago Miniature Lamp, Inc. held of record by the undersigned as of March 20,
1997 at the Annual Meeting of Shareholders to be held on April 29, 1997 or any
adjournment thereof.
1. To elect seven Directors to hold office until the next Annual
Meeting of Shareholders.
<TABLE>
<S> <C>
----- -----
FOR all nominees listed below WITHHOLD AUTHORITY to vote for
----- (except as marked to the ----- all nominees listed below
contrary below)
Werner Arnold Richard E. Ingram
Donald S. Dewsnap Thomas L. Kanaya
Michael J. Giani Frank M. Ward
Ronald S. Goldstein
</TABLE>
INSTRUCTIONS: To withhold authority to vote for any individual
nominee, write that nominee's name in the space provided.______________________
2. Ratification of reappointment of Ernst & Young LLP as the
Company's independent accountants for 1997.
<TABLE>
<S> <C> <C>
FOR [ ] AGAINST [ ] ABSTAIN [ ]
</TABLE>
3. In their discretion, the holders of this Proxy are authorized
to vote upon such other business as may properly come before
the meeting.
This Proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this Proxy
will be voted for Proposals 1 and 2.
(Continued, and to be signed on next page)
13
<PAGE> 16
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator or trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
- -------------------------------
Signature
- -------------------------------
Signature, if held jointly
DATED: , 1997
------------------
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
14
<PAGE> 17
[SCHIFINO & FLEISCHER, P.A. LETTERHEAD]
ATTORNEYS AT LAW
WILLIAM J. SCHIFINO ONE TAMPA CITY CENTER
FRANK N. FLEISCHER SUITE 2700
CYNTHIA C. ELLIS 201 NORTH FRANKLIN STREET
TAMPA, FLORIDA 33602
TELEPHONE (813) 223-1535
TELECOPIER (813) 223-3070
MARCH 28, 1997
Securities and Exchange Commission
450 5th Street NW
Washington, D.C. 20549-1004
Re: Chicago Miniature Lamp, Inc.
Proxy Statement
Gentlemen:
On behalf of our client, Chicago Miniature Lamp, Inc., we are filing via
Edgar, a definitive Proxy Statement being used in connection with the Company's
forthcoming annual meeting of shareholders scheduled to be held April 29, 1997.
Very truly yours,
SCHIFINO & FLEISCHER, P.A.
/s/ William J. Schifino
--------------------------
William J. Schifino
WJS/ah
