SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] 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 ss. 240.14a-11(c) or ss. 240.14a-12
TECH-SYM CORPORATION
(Name of Registrant as Specified in its Charter)
_____________________________________________________________________
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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>
[LOGO]
TECH-SYM CORPORATION
10500 WESTOFFICE DRIVE, SUITE 200
HOUSTON, TEXAS 77042-5391
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 11, 1999
To the Stockholders
of Tech-Sym Corporation:
The Annual Meeting of Stockholders of Tech-Sym Corporation will be held in
the Omni Ballroom of the Westchase Hilton & Towers at 9999 Westheimer, Houston,
Texas, on Tuesday, May 11, 1999, at 9:00 AM, Houston Time, for the following
purposes:
1. To elect eight directors to serve until the next annual meeting of
stockholders and until their successors are elected and qualified.
2. To consider and act upon a proposal to ratify the appointment of
PricewaterhouseCoopers LLP, certified public accountants, as independent
accountants for the year 1999.
3. To consider and act upon a proposal to approve the Second Amended
and Restated Tech-Sym Corporation 1998 Equity Incentive Plan.
And to vote on all other matters incident to the conduct of the meeting or
any adjournment(s) thereof.
Stockholders of record at the close of business on March 12, 1999, are
entitled to notice of and to vote at the meeting.
All stockholders are cordially invited and urged to attend the meeting.
EVEN IF YOU EXPECT TO ATTEND THE MEETING, YOU ARE REQUESTED TO SIGN, DATE AND
RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ADDRESSED ENVELOPE. If you should
attend, you may vote in person, if you wish, whether or not you have sent in
your proxy.
By Order of the Board of Directors.
J. RANKIN TIPPINS
GENERAL COUNSEL AND SECRETARY
APRIL 9, 1999
<PAGE>
TECH-SYM CORPORATION
PROXY STATEMENT
SOLICITATION OF PROXIES
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors (the "Board") of Tech-Sym Corporation (the
"Company" or "Tech-Sym") for use at the Annual Meeting of Stockholders of
the Company to be held in the Omni Ballroom of the Westchase Hilton & Towers at
9999 Westheimer, Houston, Texas, on Tuesday, May 11, 1999, at 9:00 AM, Houston
Time, and at any adjournment(s) thereof pursuant to and for the purposes set
forth in the accompanying Notice of Meeting.
The cost of solicitation of these proxies will be borne by the Company,
including the reasonable costs incurred by custodians, nominees, fiduciaries,
and other agents in forwarding the proxy material to their principals. The
Company has engaged Georgeson & Company, Inc., a firm of professional proxy
solicitors, to solicit proxies and will pay such firm a fee of approximately
$6,500, plus expenses for so acting. In addition to such solicitation and the
solicitation made hereby, certain directors, officers, and regular employees of
the Company may solicit proxies by telefax, telephone, and personal interview.
A proxy will be voted in accordance with the stockholder's instruction or,
if no instruction is indicated, it will be voted in favor of the proposals set
forth in the notice attached hereto. Any stockholder may revoke his or her proxy
at any time prior to its use by a later dated proxy. The proxy also may be
revoked if the stockholder is present at the meeting and elects to vote in
person. It is anticipated that the proxy materials will be first mailed or given
to stockholders on or about April 12, 1999.
SUBMISSION OF STOCKHOLDER PROPOSALS
In order to be considered for inclusion in the Company's proxy statement
relating to the 2000 Annual Meeting of Stockholders, stockholder proposals must
be received at the Company's principal executive office no later than November
26, 1999, and must otherwise comply with the requirements of Rule 14a-8 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act").
VOTING SECURITIES
At the close of business on March 12, 1999, the record date for
determination of stockholders entitled to notice of and to vote at the meeting,
there were outstanding 6,072,931 shares of Tech-Sym Common Stock (the "Common
Stock") (exclusive of 1,980,400 treasury shares), each share being entitled to
one vote upon each of the matters to be voted on at the meeting. There are no
other voting securities outstanding.
The holders of a majority of the shares entitled to vote, present in person
or by proxy, shall constitute a quorum at all meetings of stockholders. For
purposes of determining the presence of a quorum, shares entitled to vote
include shares as to which there is an abstention from voting on some or all
matters submitted for voting and include shares as to which a broker will vote
on at least one matter pursuant to discretionary authority of such broker to
vote on such matter pursuant to applicable stock exchange rules. In the absence
of a quorum (3,036,466 shares) at the meeting, either in person or by proxy, the
meeting may be adjourned from time to time without notice other than
announcement at the meeting until a quorum shall be formed.
In conformity with the corporate law of Nevada (the state of the Company's
organization) and the Company's Articles of Incorporation and Bylaws, at any
meeting of stockholders at which a quorum is
<PAGE>
present, a majority of the shares entitled to vote, present in person or
represented by proxy, shall decide any matter submitted to such a meeting for
vote, unless the matter is one upon which by law or by express provision of the
Articles of Incorporation or Bylaws the vote of a greater number is required, in
which case the vote of such greater number shall govern and control the decision
of such matter. None of the proposals set forth in this proxy statement require
a greater vote than a majority of shares. For purposes of determining whether a
majority has been obtained with respect to a particular matter, shares as to
which there is an abstention from voting and shares as to which a broker does
not have authority to vote on such matter will not be treated as present and
entitled to vote with respect to such matter.
The following table sets forth as of February 28, 1999, the beneficial
ownership of the Company's Common Stock with respect to each person known by the
Company to be the beneficial owner of more than five percent of the Company's
currently outstanding shares of Common Stock.
<TABLE>
<CAPTION>
NAME AND BUSINESS ADDRESS AMOUNT AND NATURE OF PERCENT
OF BENEFICIAL OWNERS BENEFICIAL OWNERSHIP OF CLASS
--------------------------- -------------------- --------
<S> <C> <C>
Heartland Advisors, Inc.............. 1,037,750(a) 17.09%
790 North Milwaukee Street
Milwaukee WI 53202
FMR Corp............................. 614,100(b) 10.11%
82 Devonshire Street
Boston MA 02109
Neuberger & Berman, LLC.............. 581,679(c) 9.58%
605 Third Avenue
New York NY 10158-3698
Dimensional Fund Advisors, Inc....... 406,100(d) 6.69%
1299 Ocean Avenue, 11th Floor
Santa Monica CA 90401
Merrill Lynch Trust Company of Texas
as Trustee of the Tech-Sym
Retirement Plan
and GeoScience Retirement Plan
(the "Trustee").................. 376,584(e) 6.20%
Suite 1150
2121 San Jacinto Street
Dallas, Texas 752015
</TABLE>
- ------------
(a) According to a Schedule 13G dated February 9, 1999, and filed with the
Securities and Exchange Commission by Heartland Advisors, Inc., Heartland
Advisors, Inc., had sole voting power with respect to 636,150 of such
shares and sole dispositive power with respect to all such shares.
(b) According to an amended Schedule 13G dated March 10, 1999, and filed with
the Securities and Exchange Commission by FMR Corp., FMR Corp. had sole
voting power with respect to 123,000 of such shares and sole dispositive
power with respect to all such shares.
(c) According to an amended Schedule 13G dated February 10, 1999, and filed
with the Securities and Exchange Commission by Neuberger & Berman, LLC,
Neuberger & Berman, LLC, had sole voting power with respect to 357,475 of
such shares and shared dispositive power with respect to all such shares.
(d) According to a Schedule 13G dated February 11, 1999, and filed with the
Securities and Exchange Commission by Dimensional Fund Advisors Inc.
("Dimensional"), a registered investment advisor, Dimensional is deemed
to have beneficial ownership of 406,100 shares as of December 31, 1998,
all
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
2
<PAGE>
of which shares are held in portfolios of DFA Investment Dimensions Group
Inc., a registered open-end investment company, or in series of the DFA
Investment Trust Company, a Delaware business trust, or the DFA Group
Trust and DFA Participation Group Trust, investment vehicles for qualified
employee benefit plans, all of which Dimensional serves as investment
manager. Dimensional had sole voting power and sole dispositive power with
respect to all such shares. Dimensional disclaims beneficial ownership of
all such shares.
(e) According to financial statements as of February 28, 1999, provided by the
Trustee. The shares are held for the benefit of employees and former
employees of the Company who participate in the Tech-Sym Retirement Plan
or the GeoScience Retirement Plan. Each participant may direct the Trustee
regarding the voting of such shares allocated to the participant's
account. The total number of shares does not include 27,432 shares
allocated to the accounts of the executive officers and directors which
are included in the table of beneficial ownership by officers and
directors below.
The following table sets forth as of February 28, 1999, the beneficial
ownership of the Common Stock of the Company and its GeoScience Corporation
("GeoScience") subsidiary by each nominee for director, each of the executive
officers named in the Summary Compensation Table below, all executive officers
and directors of the Company as a group, and Tech-Sym as regards GeoScience.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP
------------------------------------------------------------------------------
GEOSCIENCE COMMON STOCK TECH-SYM COMMON STOCK
------------------------------------ ---------------------------------------
SOLE VOTING OPTIONS SOLE VOTING OPTIONS
AND EXERCISABLE AND EXERCISABLE
NAME OF INDIVIDUAL INVESTMENT WITHIN PERCENT INVESTMENT WITHIN PERCENT
OR GROUP POWER 60 DAYS OF CLASS POWER 60 DAYS OF CLASS
------------------ ----------- ----------- -------- ----------- ----------- --------
<S> <C> <C> <C> <C> <C> <C>
J. Michael Camp...................... 0 0 * 0 0 *
W. L. Creech......................... 41,000 24,000 * 1,000 10,000 *
Michael C. Forrest................... 2,500 24,000 * 1,500 15,000 *
Richard S. Friedland................. 0 0 * 0 10,000 *
A. A. Gallotta, Jr................... 600 10,000 * 3,300 17,000 *
Wendell W. Gamel..................... 7,000 25,000 * 84,995(a)(b) 36,000 1.92%
Charles B. Johnson................... 700 0 * 5,251 10,000 *
Richard F. Miles..................... 3,200(a) 28,750 * 826(a) 0 *
Coy J. Scribner...................... 500 2,500 * 11,334(a) 31,000 *
Ray F. Thompson...................... 4,000 12,500 * 21,295(a) 25,000 *
J. Rankin Tippins.................... 6,000 12,500 * 11,260(a) 15,000 *
Charles K. Watt...................... 1,000 10,000 * 0 20,000 *
All directors and executive officers
as a group (14 persons)............ 68,400 155,500 2.21% 144,454 191,000 5.36%
Tech-Sym Corporation................. 7,900,000 0 79.12%
</TABLE>
- ------------
* Less than one percent (1%)
(a) Includes shares allocated to the employee or director through his
participation in the Tech-Sym Retirement Plan or the GeoScience Retirement
Plan.
(b) Includes 5,000 shares held in trust for Mr. Gamel's adult children in
which he disclaims beneficial ownership.
3
<PAGE>
ELECTION OF DIRECTORS
PROPOSAL 1: THE BOARD OF DIRECTORS BY A UNANIMOUS VOTE NOMINATED AND URGES
YOU TO VOTE FOR THE EIGHT NOMINEES LISTED BELOW. PROXIES SOLICITED HEREBY WILL
BE SO VOTED UNLESS STOCKHOLDERS SPECIFY OTHERWISE IN THEIR PROXIES. THE EIGHT
NOMINEES RECEIVING THE GREATEST NUMBER OF VOTES ENTITLED TO BE CAST SHALL BE
ELECTED.
The Board recommends the election of the nominees listed below as directors
to hold office until the next annual meeting of stockholders and until their
successors are elected and qualified. Each of such nominees is presently a
member of the Board. If at the time of the 1999 annual meeting of stockholders,
any of such nominees should be unable to serve or is unwilling to serve, the
discretionary authority provided in the Proxy will be used to vote for a
substitute or substitutes designated by the Board of Directors. The Board of
Directors has no reason to believe that any substitute nominee or nominees will
be required.
The Articles of Incorporation provide that the affairs of the Company shall
be conducted by a Board of Directors of not less than three nor more than twenty
members and empower the Board to increase or decrease its size within such
limits. The Board in its discretion and in accordance with such authority has
fixed its size at nine members. Dr. Christopher C. Kraft, Jr., a current
director, has reached the age of 75 years and, under the Company's Bylaws, is
not eligible to stand for re-election. He intends to retire upon the expiration
of his term of office at the Annual Meeting, at which time the size of the Board
of Directors shall be reduced from nine to eight members. No proxy will be voted
for a greater number of persons than the number of nominees named herein. If
deemed desirable in the best interests of the Company, the Board of Directors
(pursuant to authority contained in the Articles of Incorporation) may,
subsequent to the annual meeting of stockholders, increase its size and elect
one or more additional qualified persons to fill the vacancies which then exist
pending the next annual meeting of stockholders.
The nominees, and certain information with respect to each of them, are as
follows:
J. MICHAEL CAMP Age 49
Director since 1998
Mr. Camp has served as President and Chief Executive Officer of the Company
since May of 1998. Prior to joining Tech-Sym, Mr. Camp served as President and
Chief Executive Officer of Olicom, Inc., a company that develops and markets
computer network software and hardware products (from 1996 to 1998). Prior
thereto, he served in various capacities at Northern Telecom Inc. including Vice
President and General Manager of the Multimedia Business Applications Division
(from 1993 to 1996), Vice President and General Manager of the Data Network
Division (from 1992 to 1993), and General Manager of the Network Integration
Division (from 1991 to 1992). Mr. Camp also serves as a director of GeoScience
Corporation.
W. L. CREECH Succession Committee Chairman Age 72
Director since 1989 Compensation Committee Member
Since his retirement from the United States Air Force as a Four Star General in
1984, General Creech has been an independent business consultant. He is the
author of THE FIVE PILLARS OF TQM. During his military career spanning more than
37 years, General Creech held a succession of important posts, including as his
last assignment Commander of the Tactical Air Command USAF. General Creech also
serves as a director of Comarco, Inc., ESEA Corporation, and GeoScience
Corporation.
4
<PAGE>
MICHAEL C. FORREST Audit Committee Member Age 65
Director since 1995 Succession Committee Member
Mr. Forrest has been a consultant to the petroleum exploration industry since
his retirement in 1997 from his position as the Senior Vice President of
Technology and Business Development at Maxus Energy Corporation, a position he
held since 1994. Mr. Forrest joined Maxus in 1992 as Vice Chairman and Chief
Operating Officer and served on its Board from 1992 to 1995, at which time Maxus
was acquired by YPF. Prior to that, Mr. Forrest was president of Pecten
International Co., a subsidiary of Shell U.S.A., and had worked within the
exploration and production divisions of Shell for thirty-seven years. He also
serves as a director of GeoScience Corporation.
RICHARD S. FRIEDLAND Age 48
Director since 1998
Mr. Friedland was the Chairman of the Board and Chief Executive Officer of
NextLevel Systems, Inc., a worldwide supplier of communication networks created
by the three-way split of General Instrument Corporation, from July 1997 to
October 1997. He previously served as Chairman of the Board and Chief Executive
Officer of General Instrument Corporation from 1995 to 1997, its President and
Chief Operating Officer from 1993 until 1995 and Chief Financial Officer from
1992 to 1994. He also serves as a director of Premark International, Inc.,
Zilog, Inc., and Objective Communications, Inc.
A. A. GALLOTTA, JR. Audit Committee Chairman Age 66
Director since 1986 Succession Committee Member
Admiral Gallotta has been President of AAG Associates, Inc., a consulting firm
for electronic companies, since 1985, the year that he retired from the United
States Navy as a Rear Admiral. From 1988 to 1990, he served as President and
Director of SWL, Inc., a technical support contractor to the United States
Department of Defense and a subsidiary of Flow General Corporation. Admiral
Gallotta dedicated 23 years of his naval career to electronic warfare related
activities and was Vice Commander, Naval Electronics System Command, at the time
of his retirement.
WENDELL W. GAMEL Age 69
Director since 1966
Mr. Gamel served the Company as its President and Chief Executive Officer from
1975 to 1998. In 1980, he was elected Chairman of the Board and has continuously
served in that capacity ever since. He also serves as a director and Chairman of
the Board of GeoScience Corporation.
COY J. SCRIBNER Age 67
Director since 1983
From 1972 to 1998, Mr. Scribner was President of Metric Systems Corporation, a
subsidiary of the Company engaged in the business of designing and manufacturing
electronic systems primarily used in defense. He was also a Vice President of
the Company from 1985 to 1998 and served as Chairman of Enterprise Electronics
Corporation, a subsidiary of the Company engaged in the business of designing
and manufacturing weather information systems, from 1984 to 1998. He continues
to serve the Company as Vice Chairman of Metric Systems Corporation.
CHARLES K. WATT Compensation Committee Member Age 61
Director since 1987
Since 1988, Dr. Watt has served as Chairman of Scientific Research Corporation,
a company involved in advanced technology products and services in which both
the Company and Dr. Watt have equity interests. Since April 1990, Professor Watt
has been a faculty member and Executive Assistant to the President at Clemson
University. Prior to this appointment, he served as a laboratory director and
faculty member at the Georgia Institute of Technology and as Director of Defense
Test and Evaluation in the Office of the Secretary of Defense.
5
<PAGE>
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board has standing audit and compensation committees (the "Audit
Committee" and the "Compensation Committee," respectively) that are composed
of directors of the Company. A succession committee (the "Succession
Committee") composed of outside directors of the Company, was established on
June 20, 1997, to recommend to the Board of Directors a successor as president
of the Company. On May 1, 1998, Mr. Camp succeeded Mr. Gamel as president of the
Company. The Board does not have a standing nominating committee, but considers
and selects as a whole directors to fill Board vacancies that arise between
annual meetings of stockholders as well as nominates candidates for election at
such meetings. During 1998, the Audit Committee had three meetings, the
Compensation Committee had five meetings, the Succession Committee had two
meetings, and the Board of Directors had six regular and two special meetings.
All members of the Board of Directors attended 75% or more of the total number
of meetings of the Board and Board committees on which they served.
The Audit Committee makes recommendations concerning the engagement of
independent accountants, reviews with the independent accountants the plan and
results of the auditing engagement, approves professional services provided by
the independent accountants, reviews the independence of the independent
accountants and reviews the adequacy of the Company's internal accounting
controls.
The Compensation Committee makes recommendations to the Board as to
compensation to be paid to (i) the officers of the Company, (ii) the chief
executive officers and general managers of subsidiaries and divisions except for
GeoScience and its subsidiaries, and (iii) all employees of the Company and its
subsidiaries, except GeoScience and its subsidiaries, regardless of position,
whose compensation exceeds a certain amount. The Compensation Committee also
reviews, and makes recommendations to the Board with respect to, all incentive
compensation plans proposed for the Company and its subsidiaries. The Board has
final approval concerning the recommendations of the Compensation Committee. The
Compensation Committee administers the 1990 Stock Option Plan and the 1998
Equity Incentive Plan of the Company and has sole authority to grant options and
stock appreciation rights under the 1998 Equity Incentive Plan.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Since September 12, 1988, Dr. Watt has served as Chairman of Scientific
Research Corporation ("SRC") in which both the Company and Dr. Watt have
equity interests. Mr. Gamel serves on the SRC Board of Directors which
determines the compensation for Dr. Watt.
DIRECTORS' REMUNERATION
Members of the Board of Directors who are not employees of the Company are
paid a fee of $2,000 for attendance at each Board meeting and a fee of $750 for
attendance at each Board committee meeting except for committee chairmen who are
paid $1,250 for attendance at each Board committee meeting which they chair.
Board members who are employees of the Company receive a fee of $100 for
attendance at each Board meeting. Members of the Board who are not current or
former employees of the Company are also paid an Annual Director Fee of $24,000.
NONEMPLOYEE DIRECTORS RETIREMENT PLAN
Each director who is not a present or former officer or employee of the
Company covered by a Company retirement plan or agreement is automatically
covered by the Company's Nonemployee Directors Retirement Plan. Upon retirement
on or after reaching age 65 or termination of service due to disability, each
such director will be entitled to receive from the Company an annual retirement
benefit equal to 65% of the Annual Director Fee in effect prior to retirement or
disability. If a director leaves the Board prior to
6
<PAGE>
reaching age 65 for reasons other than disability, his retirement benefit will
not begin until the director reaches age 65 and, if the director has served less
than ten years as a director, retirement benefit will be reduced by 10% for each
such year.
The surviving spouse of a deceased director who was entitled to receive a
retirement benefit under this plan will receive an annual benefit from the
Company, beginning with the director's death, equal to 37 1/2% of the Annual
Director Fee, subject to a reduction of 10% for each year less than 10 served as
a director unless such director was a member of the Board on the date of death
or had been previously terminated due to a disability. The spouse's benefit will
continue for ten years or until the spouse's death, whichever occurs first.
In the event of a change in control of the Company, as defined in the plan,
the retirement benefits become 100% vested regardless of a director's length of
service and are payable in a lump sum. The Company has contributed certain
assets to a trust with a commercial bank to provide for the payment of the
benefits under the plan. The amounts held in trust remain available to the
claims of creditors of the Company in the event of its bankruptcy or insolvency.
INSURANCE
The Company maintains a Directors and Officers Insurance Policy and a
Travel Accident Insurance Policy for the benefit of the Company and its
Directors.
STOCK OPTION PLAN
The Company's 1998 Equity Incentive Plan (the "Plan") provides for the
automatic grant of non-qualified stock options to nonemployee directors of the
Company. An individual who becomes a nonemployee director, and has not
previously been an employee director, is automatically granted options with
respect to 10,000 shares of Common Stock as of the date such person first
becomes a member of the Board of Directors. Each nonemployee director is
automatically granted options with respect to an additional 5,000 shares of
Common Stock effective as of the date of each regular annual meeting at which
such person is reelected or continues to serve as a director. The exercise price
of such options may not be less than 100% of the fair market value per share of
the Common Stock on the date of grant. The stock options are fully exercisable
on their date of grant and have a term of ten years unless earlier terminated in
the event a nonemployee director ceases to be a member of the Board for any
reason except death, disability, or retirement. The Plan provides that, upon a
change in control of the Company, all outstanding stock options would be
immediately exercisable (with certain exceptions).
On October 15, 1998, the Compensation Committee recommended, and the Board
of Directors approved, subject to stockholder approval, a Second Amendment to
the Plan. If the Second Amendment is approved by the stockholders at the 1999
Annual Meeting, each nonemployee director serving on the Board of Directors on
October 15, 1998, will receive options to purchase 6,000 shares of Common Stock
at an exercise price of $21.25, which was 100% of the closing market price per
share on October 15, 1998, the date of grant. See Proposal 3: Approval of the
Second Amended and Restated 1998 Equity Incentive Plan.
CERTAIN TRANSACTIONS
The Company is required to make annual payments for life to Messrs. Gamel
and Scribner, both members of the Board of Directors, of $156,000 and $150,150,
respectively, pursuant to Executive Retirement Agreements dated April 30, 1992,
as amended. The Agreements were amended in 1998 to eliminate the requirement
that the individuals retire prior to receiving payments. Messrs. Gamel and
Scribner received $104,000 and $100,100, respectively, under the Agreements in
1998. The Agreements
7
<PAGE>
also provide for payment of a surviving spouse's benefit in an annual amount of
$90,000 and $86,625, respectively, for the lesser of ten years or the remainder
of the spouse's life.
In addition to the Executive Retirement Agreement payments stated above,
Mr. Gamel received $66,667 for his services as Chairman of the Board after his
resignation as President and Chief Executive Officer of the Company effective
April 30, 1998, and Mr. Scribner received $50,000 for his services as Vice
Chairman of Metric Systems Corporation after his resignation as its President
effective April 30, 1998.
COMPLIANCE WITH SECTION 16 OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers and, if any, persons who own more than ten percent of the
Company's Common Stock to file with the Securities and Exchange Commission and
the New York Stock Exchange reports relating to ownership and changes in
ownership of such Common Stock. Copies of these reports must also be furnished
to the Company. Based on a review of these reports and on written
representations from the reporting persons that no other reports were required,
the Company believes that all applicable Section 16(a) reporting requirements
were fulfilled, except that Mr. Kenneth R. Allstaff was late in reporting his
election as an executive officer of the Company.
COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
The Company's executive compensation policies and practices are designed to
provide competitive levels of compensation that integrate pay with the Company's
annual and long-term performance goals. Compensation of the executive officers
of the Company is primarily comprised of salary, incentive bonus, and stock
options. In addition, all of the executive officers are eligible to participate
in either the Company's or GeoScience's Section 401(k) Retirement Plan. Certain
executive officers are also parties to Termination Agreements and Executive
Retirement Agreements with the Company.
SALARY
The base salaries of the executive officers are established at a level
deemed appropriate to attract and retain qualified executives. In establishing
its recommendations, the Compensation Committee considers the recommendations of
management, the responsibilities of the executive officers, the salaries of
others similarly situated both within and outside of the Company, the recent
performance in the executive's area of responsibility, the relative performance
of other companies in similar businesses, and any changes in the cost-of-living.
The salaries of the executive officers are usually reviewed annually with the
performance of the prior year taken into account. As a result, the salaries
received in 1998 were determined, in part, by each individual's performance in
1997.
INCENTIVE BONUS PLANS
The Company has an incentive bonus plan which provides for incentive
compensation for its officers and key employees, as well as the presidents of
its wholly owned subsidiaries. The Company's subsidiaries have separate profit
sharing incentive bonus plans. Under the Company's plan, the aggregate bonus
pool from which such awards can be made in any year cannot exceed 2% of the
Company's consolidated earnings before federal and state income taxes plus an
amount equal to 25% of the incentive bonus pool accrued by each wholly owned
subsidiary pursuant to its plan. The Committee recommended, and the Board
approved, a 1998 bonus pool exceeding such limitations due to the unusual
write-down of inventory by a subsidiary of GeoScience. The apportionment of that
part of the Company's incentive bonus pool paid to
8
<PAGE>
the executive officers, excluding those executive officers employed by
GeoScience or its subsidiaries, is determined by the Company's Board of
Directors, pursuant to recommendations of the Compensation Committee, according
to levels of responsibilities, individual performance, and industry standards.
No bonus is payable if the Company fails to earn a profit.
Under the GeoScience incentive bonus plan, the aggregate bonus pool from
which awards can be made in any year cannot exceed 2% of GeoScience's
consolidated earnings before federal and state income taxes. The apportionment
of that part of the GeoScience incentive bonus pool paid to the executive
officers is determined by the GeoScience Board of Directors, pursuant to
recommendations of its Compensation Committee, according to levels of
responsibilities and individual performance. No bonus is payable if GeoScience
fails to earn a profit.
Under the incentive bonus plan for the Company's and GeoScience's wholly
owned subsidiaries, officers and key employees of each of the subsidiaries,
excluding the presidents of the subsidiaries, are eligible to share in a bonus
pool, calculated separately for each subsidiary, amounting to not less than 6%
and not more than 15% of such subsidiary's annual earnings before state and
federal income taxes. Bonus amounts earned in excess of 6% pre-tax earnings
depend upon the degree by which each subsidiary exceeds certain performance
criteria, such as sales, net profit and return on investment. The apportionment
of the total amount of the bonus and the recipients thereof are determined by
the senior management of the Company or GeoScience, respectively, and the
respective subsidiary according to levels of responsibility and individual
performance except that approval of the Board of Directors of the Company or
GeoScience, respectively, pursuant to recommendations of the respective
Compensation Committee, is required for an award to (i) any recipient whose
annual salary is equal to or greater than $125,000 and $100,000, respectively,
and (ii) any division or subsidiary general manager or chief executive officer,
regardless of the amount of compensation. No bonus is payable if the subsidiary
fails to earn a profit.
The amount of the bonus pool of the Company and of each subsidiary is
subject to reduction by the amount of (i) any bonuses such as year-end bonuses
paid to employees for such year, (ii) the matching contributions which each such
company would be required to make to the retirement plan, if any, on the total
bonus pool amount for the accounts of its bonus recipients and (iii) certain
marketing incentives paid to employees for such year.
EQUITY INCENTIVE PLANS
The Company's and GeoScience's Equity Incentive Plans are designed to align
the long-term interests of key employees with shareholder interests. The
exercise price of stock options may not be less than 100% of the fair market
value per share of the Common Stock on the date of the grant. The employees
awarded stock options benefit only when the market price of the Company's or
GeoScience's stock increases to the benefit of all shareholders. It has been the
practice to grant Tech-Sym stock options to executive officers every three to
five years with the options vesting incrementally over a three or four year
period. GeoScience stock options have been granted to executive officers
annually and the options vest incrementally over a four-year period. The number
of options granted to any individual is dependent on the individual's level of
responsibility and ability to influence the performance of the Company and its
subsidiaries.
CEO COMPENSATION
As with the other executive officers, the compensation of the Chief
Executive Officer consists primarily of salary, incentive bonus, and stock
options. The CEO's salary is reviewed on an annual basis by the Compensation
Committee and the Board of Directors at the time of the annual election of
officers at the Director's meeting held in conjunction with the annual
stockholders' meeting each year. The incentive
9
<PAGE>
bonus is determined after the end of each year when financial results are
available. Stock option grants are not automatic nor awarded on a regular basis.
Effective April 30, 1998, Mr. Gamel resigned as President and Chief
Executive Officer of the Company. He continues to serve the Company in the
capacity of Chairman of the Board of Directors, an executive officer position,
at an annual salary of $100,000. Mr. Gamel did not receive an incentive bonus
for 1998. The Compensation Committee did not grant Mr. Gamel any stock options
in 1998. The Compensation Committee of the Company's GeoScience subsidiary, for
which Mr. Gamel serves as its Chairman of the Board of Directors, granted Mr.
Gamel stock options for 25,000 shares of GeoScience Common Stock with an
exercise price of $13.75 per share, which was 100% of the closing price on the
date of grant.
Pursuant to the recommendation by the Company's Succession Committee, Mr.
J. Michael Camp was elected as President and Chief Executive Officer effective
May 1, 1998. His election came after many months of reviewing candidates
presented by an executive search firm. His annual salary of $310,000 was
competitive with the salary required by other qualified candidates. Upon his
election, he was granted stock options for 100,000 shares of the Company's
Common Stock and 25,000 shares of GeoScience Common Stock at 100% of the closing
prices that day. The 100,000 Tech-Sym stock options were subsequently
repriced -- see Stock Option Repricing below.
A major portion of Mr. Camp's compensation consists of an annual incentive
bonus under the Incentive Bonus Plan described above and, as such, fluctuates
with the financial performance of the Company. The Compensation Committee
observed that the Company's earnings from continuing operations were 23% greater
in 1998 than the prior year and the Company had taken significant steps to
divest its nonstrategic assets and focus on its core businesses. As a result,
the Compensation Committee recommended, and the Board approved, a 1998 incentive
bonus of $150,000 for Mr. Camp.
STOCK OPTION REPRICING
In October of 1998, the Committee reduced the exercise price of
approximately 46% of the outstanding stock options (the "Repriced Options")
held by the Company's employees due to the general decline in the stock market
and the specific decline in the market value of the Company's Common Stock. The
stock options, all of which had been granted between March 1996 and May 1998,
were repriced at 100% of the closing price on the day repriced and subject to
certain conditions. The original vesting schedule of 20% vesting after one year
from grant and 20% vesting every six months thereafter was extended by a year so
that 20% vested two years after the original date of grant and 20% vested every
six months thereafter. However, under no circumstance were the repriced options
exercisable for one year after they were repriced.
The Committee repriced these employee stock options in an effort to retain
employees at a time when a significant percentage of employee stock options had
exercise prices that were above market value. The Committee believes that stock
options comprise a significant portion of the compensation of key employees and
are a valuable tool in compensating and retaining key employees. The Committee
determined that it was in the best interest of the Company to reprice existing
options rather than issue additional options or increase other compensation
components in order to retain, motivate and reward key employees.
10
<PAGE>
TEN-YEAR OPTION/SAR REPRICINGS
The following table sets forth certain information concerning the Repriced
Options.
<TABLE>
<CAPTION>
NUMBER OF LENGTH OF
SECURITIES MARKET ORIGINAL
UNDERLYING PRICE OF EXERCISE OPTION TERM
OPTIONS/ STOCK AT PRICE AT REMAINING
SARS TIME OF TIME OF NEW AT DATE OF
REPRICED OR REPRICING OR REPRICING OR EXERCISE REPRICING OR
NAME DATE AMENDED(#) AMENDMENT($) AMENDMENT($) PRICE($) AMENDMENT
--------- -------- ----------- ------------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
W. W. Gamel.......................... 10/15/98 25,000 21.25 34.625 21.25 7 1/2 years
J. M. Camp........................... 10/15/98 100,000 21.25 31.5625 21.25 9 1/2 years
R. F. Thompson....................... 10/15/98 15,000 21.25 34.625 21.25 7 1/2 years
R. M. Miles.......................... 10/15/98 5,000 21.25 34.625 21.25 7 1/2 years
J. R. Tippins........................ 10/15/98 15,000 21.25 34.625 21.25 7 1/2 years
C. B. Johnson........................ 10/15/98 9,500 21.25 34.625 21.25 7 1/2 years
</TABLE>
The foregoing 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, as
amended, (the "Securities Act"), or under the Exchange Act, except to the
extent that the Company specifically incorporated this information by reference,
and shall not otherwise be deemed filed under such acts.
The foregoing report is given by the following members of the Compensation
Committee.
Christopher C. Kraft, Jr. W. L. Creech Charles K. Wattiiiii
11
<PAGE>
SUMMARY COMPENSATION TABLE
The Summary Compensation Table shows certain compensation information for
the Chief Executive Officer, the former Chief Executive Officer, and the four
other most highly compensated executive officers in 1998 (as the term
"executive officer" is defined for proxy purposes by the Securities and
Exchange Commission) for services rendered in all capacities during the years
ended December 31, 1998, 1997, and 1996.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION ---------------------------
---------------------------------------------- SECURITIES SECURITIES
OTHER UNDERLYING UNDERLYING
ANNUAL TECH-SYM GEOSCIENCE ALL OTHER
NAME AND SALARY BONUS COMPENSATION OPTIONS/SARS OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($)(A) ($)(B) (#)(C) (#) ($)(D)
------------------------ ---- --------- ------------ ------------------ ------------ ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
W. W. GAMEL(e).................... 1998 188,333 -0- -- 25,000(f) 25,000 8,884
Chairman of the Board and former 1997 360,000 92,000 -- -0- 12,500 8,592
President and Chief Executive 1996 343,667 190,000 -- 25,000 25,000 8,505
Officer
J. M. CAMP(g)..................... 1998 206,667 150,000 61,435(h) 100,000(i) 25,000 143,471(j)
President and Chief
Executive Officer
R. F. THOMPSON.................... 1998 204,333 100,000 -- 15,000(f) 5,000 8,005
Vice President, Treasurer, 1997 187,000 75,000 -- -0- 7,500 7,922
and Chief Financial Officer 1996 172,000 150,000 -- 15,000 15,000 7,714
R. F. MILES....................... 1998 218,333 75,000 -- 5,000(f) 40,000 7,200
President of GeoScience 1997 201,667 35,000 -- -0- 12,500 7,179
Corporation 1996 195,000 140,350 -- 5,000 25,000 6,854
J. R. TIPPINS..................... 1998 165,667 86,000 -- 15,000(f) 5,000 7,684
General Counsel 1997 154,667 62,000 -- -0- 7,500 7,568
and Secretary 1996 142,733 119,772 -- 15,000 15,000 7,413
CHARLES B. JOHNSON(k)............. 1998 201,045 35,000 -- 9,500(f) -0- 7,847
President of Metric Systems
Corporation
</TABLE>
- ------------
(a) Incentive bonus amounts were earned during the years indicated, but paid
in the first quarter of the following year.
(b) The dollar value of other annual compensation not properly categorized as
salary or bonus, such as perquisites and other personal benefits, did not
exceed the lesser of $50,000 or 10% of the total of annual salary and
bonus for any of the named executive officers in any of the years listed,
except for Mr. Camp.
(c) Includes stock appreciation rights (SARs) awarded in tandem with each
stock option except for Mr. Camp's.
(d) Except for Mr. Camp, each of the amounts in this column are matching
contributions by the Company to the executive officer's account in the
Company's Retirement (401(k)) Plan. The amounts for Mr. Gamel include $700
in 1996, $600 in 1997, and $800 in 1998 for attending Board meetings.
(e) Mr. Gamel resigned as President and Chief Executive Officer effective
April 30, 1998 but continued to receive compensation as Chairman of the
Board, an executive officer position.
(f) The stock options were originally granted in 1996 (as indicated), but were
repriced on October 15, 1998. See the Ten-Year Option/SAR Repricings table
above.
(g) Mr. Camp was elected as President and Chief Executive Officer effective
May 1, 1998.
(h) Includes (x) tax reimbursement payments of $57,426 related to certain
relocation costs and benefits paid by the Company in connection with Mr.
Camp's relocation to Houston, Texas, and (y) automobile allowance of
$4,009 attributable to personal use.
(i) Effective May 1, 1998, the effective date of his election as President and
Chief Executive Officer, Mr. Camp received a stock option grant for
100,000 shares of the Company's Common Stock. The options were repriced on
October 15, 1998, along with other executive officers and employees. See
the Ten-Year Option/SAR Repricing table above.
(j) Includes (x) certain relocation costs and benefits of $142,871 paid by the
Company in connection with Mr. Camp's relocation to Houston, Texas, and
(y) $600 for attending Board meetings.
(k) Mr. Johnson was elected as President of Metric Systems Corporation
effective May 1, 1998.
12
<PAGE>
OPTION/SAR GRANTS TABLE
The following table sets forth information concerning grants and repricing
of Tech-Sym stock options and grants of GeoScience stock options during 1998 to
each of the named executive officers.
<TABLE>
<CAPTION>
% OF
TOTAL
NUMBER OF OPTIONS
SECURITIES REPRICED
UNDERLYING AND
OPTIONS GRANTED
REPRICED TO EXERCISE
AND EMPLOYEES OR BASE GRANT DATE
GRANTED IN FISCAL PRICE EXPIRATION PRESENT VALUE
NAME COMPANY (#)(A) YEAR(B) ($/SH) DATE ($)(C)
------ ----------- ---------- --------- -------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
W. W. Gamel.......................... Tech-Sym 25,000* 6 21.2500 4/29/06 203,250
GeoScience 25,000 10 13.7500 4/26/08 228,500
J. M. Camp........................... Tech-Sym 100,000* 25 21.2500 4/30/08 920,000
GeoScience 25,000 10 13.8750 4/30/08 230,750
R. F. Thompson....................... Tech-Sym 15,000* 4 21.2500 4/29/06 121,950
GeoScience 5,000 2 13.7500 4/26/08 45,700
R. F. Miles.......................... Tech-Sym 5,000* 1 21.2500 4/29/06 40,650
GeoScience 40,000 16 13.7500 4/26/08 365,560
J. R. Tippins........................ Tech-Sym 15,000* 4 21.2500 4/29/06 121,950
GeoScience 5,000 2 13.7500 4/26/08 45,700
C. B. Johnson........................ Tech-Sym 9,500* 2 21.2500 4/29/06 77,235
GeoScience 0 0 n/a n/a 0
</TABLE>
- ------------
* These figures represent the Repriced Options. These options were originally
granted in 1996 at an exercise price of $34.625 per share except for Mr.
Camp's which were originally granted in May of 1998 at an exercise price of
$31.5625. No Tech-Sym options were granted to employees in 1998 except for
the stock options for 100,000 shares granted to Mr. Camp upon his election
as President and CEO effective May 1, 1998.
(a) According to the shareholder approved GeoScience 1996 Equity Incentive Plan,
as amended, the exercise price of stock options and stock appreciation
rights may not be less than the market value per share on the date of grant.
GeoScience options are exercisable starting twelve months from grant date,
with 25% of the shares covered thereby becoming exercisable at that time and
25% of the option shares becoming exercisable every year thereafter with
full vesting occurring on the fourth anniversary date. The options are not
transferable other than by will or by the laws of descent and distribution.
The option expires three months after the optionee's employment terminates
except in the event of death, permanent disability, or retirement. The
options and any gains therefrom may also be forfeited by the optionee under
certain conditions including the commission of an illegal act and working
with a competitor of GeoScience.
(b) The percentages include both option grants and Repriced Options.
(c) In accordance with Securities and Exchange Commission rules, the
Black-Scholes option pricing model was used to estimate the value of the
Repriced Options, Mr. Camp's Repriced Option, the GeoScience options, and
Mr. Camp's GeoScience options to be $8.13, $9.20, $9.14, and $9.23 per
option share, respectively, as of the grant or repricing date. The model's
mathematical formula is primarily used to value traded stock options and is
premised on immediate exercisability and transferability of the options.
This is not true for the options granted to executive officers and other
employees. Therefore, the values shown are theoretical and are not intended
to reflect the actual values the recipients may eventually realize, if any.
Any ultimate value will depend on the excess of the stock price over the
exercise price on the date the optionee, in his sole discretion, exercises
the option. The following assumptions were used for the purpose of
estimating the Grant Date present value: (i) option term of eight years,
(ii) volatility of 28% for Tech-Sym and 56% for GeoScience, (iii) dividend
yield of zero, and (iv) risk-free rate of return of 4.26% for Tech-Sym and
5.70% for GeoScience.
13
<PAGE>
OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE
The following table summarizes for each of the named executive officers the
number of Tech-Sym and GeoScience stock options and stock appreciation rights
(SARs), if any, exercised during the year ended December 31, 1998, the aggregate
dollar value realized upon exercise, the total number of unexercised options and
SARs, if any, held at December 31, 1998, and the aggregate dollar value of
in-the-money, unexercised options and SARs, if any, held at December 31, 1998.
Value realized upon exercise is the difference between the fair market value of
the underlying stock on the exercise date and the exercise or base price of the
option or SAR. Value of the unexercised, in-the-money options or SARs at fiscal
year-end is the difference between its exercise or base price and the fair
market value of the underlying stock on December 31, 1998, which was $22.25 per
share for Tech-Sym and $10.9375 per share for GeoScience. THESE VALUES, UNLIKE
THE AMOUNTS SET FORTH IN THE COLUMN HEADED "VALUE REALIZED," HAVE NOT BEEN,
AND MAY NEVER BE REALIZED. THE UNDERLYING OPTIONS OR SARS HAVE NOT BEEN, AND MAY
NOT BE, EXERCISED; AND ACTUAL GAINS, IF ANY, ON EXERCISE WILL DEPEND ON THE
VALUE OF TECH-SYM AND GEOSCIENCE COMMON STOCK ON THE DATE OF EXERCISE. THERE CAN
BE NO ASSURANCE THAT THESE VALUES WILL BE REALIZED. Unexercisable options are
those which have not yet vested under the vesting schedule in the Company's 1990
Stock Option Plan, the Company's 1998 Equity Incentive Plan, or GeoScience's
1996 Equity Incentive Plan.
AGGREGATED OPTION/SAR EXERCISES
IN 1998 AND FY-END
OPTION/SAR VALUES
<TABLE>
<CAPTION>
VALUE OF
UNEXERCISED
NUMBER OF SECURITIES IN-THE-MONEY
UNDERLYING UNEXERCISED OPTIONS/SARS
OPTIONS/SARS AT FY-END
SHARES AT FY-END(#)(A) ($)(B)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME COMPANY EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------ ----------- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
W. W. Gamel.............. Tech-Sym -0- -0- 36,000 25,000 280,000 25,000
GeoScience -0- -0- 15,625 46,875 4,883 14,648
J. M. Camp............... Tech-Sym -0- -0- -0- 100,000 -0- 100,000
GeoScience -0- -0- -0- 25,000 -0- -0-
R. F. Thompson........... Tech-Sym -0- -0- 25,000 15,000 201,250 15,000
GeoScience -0- -0- 9,375 18,125 2,930 8,789
R. F. Miles.............. Tech-Sym 5,000 73,750 -0- 5,000 -0- 5,000
GeoScience -0- -0- 15,625 61,875 4,883 14,648
J. R. Tippins............ Tech-Sym 3,000 40,688 15,000 15,000 97,500 15,000
GeoScience -0- -0- 9,375 18,125 2,930 8,789
C. B. Johnson............ Tech-Sym -0- -0- 10,000 9,500 65,000 9,500
GeoScience -0- -0- -0- -0- -0- -0-
</TABLE>
- ------------
(a) Includes SARs awarded in tandem with each Tech-Sym stock option except for
Mr. Camp.
(b) In-the-Money Options/SARs are those where the fair market value of the
underlying security exceeds the exercise or base price of the option or
SAR.
14
<PAGE>
EXECUTIVE RETIREMENT AGREEMENTS
Messrs. Gamel, Thompson, Miles, and Tippins are each parties to retirement
agreements with the Company which provide for the payment to each such officer
an annual retirement benefit for the remainder of his life commencing at his
retirement on or after age 65, except for Mr. Gamel whose benefit commenced on
May 1, 1998, in an amount equal to 65% of such executive's highest rate of base
salary in effect at any time prior to his reaching age 61 ("Base Salary"). If
such executive voluntarily terminates his employment prior to age 65, but on or
after age 62, he shall commence receiving his retirement benefit reduced by
1.39% for each full calendar month which his date of termination precedes his
65th birthday, unless such reduction is waived by the Board. The applicable Base
Salaries to date of Messrs. Gamel, Thompson, Miles, and Tippins are $240,000,
$193,000, $225,000, and $170,000, respectively. The agreements further provide
for the payment of a surviving spouse's benefit equal to 37 1/2% of the
officer's Base Salary, which is payable annually upon his death to his surviving
spouse, if any, for the lesser of ten years or the remainder of her life. The
Company's obligation under each of the agreements to pay the retirement benefits
terminates if the officer voluntarily leaves the employ of the Company prior to
reaching age 62 (other than due to death or total and permanent disability) or
is terminated for cause. The benefits remain payable in the event of either the
executive's termination of employment prior to age 62 because of his total and
permanent disability or his termination after reaching age 62, but in both
instances are subject to reduction for their early commencement unless such
reduction is waived by the Board. Under each of the agreements, the surviving
spouse's benefit is not payable if the officer voluntarily leaves the employ of
the Company prior to age 62 or is terminated for cause, but is payable if the
executive dies while still in the employ of the Company, or after his
termination of employment after reaching age 62 or after his termination due to
a disability. The agreements also provide the executive with continued
Company-provided health benefits after his retirement. The benefits under the
agreements are completely vested except for those contained in the agreement
with Mr. Miles which provides for 50% vesting after ten years of continuous
employment with the Company (such employment commencing January 29, 1990) with
an additional 10% each year thereafter until fully vested.
The Company has contributed certain assets to a trust with a commercial
bank to provide for the payment of the benefits under the retirement agreements.
The amounts held in trust remain available to the claims of creditors of the
Company in the event of its bankruptcy or insolvency.
TERMINATION AGREEMENTS
The Company has entered into Termination Agreements with certain key
employees, including Messrs. Camp, Thompson, Miles, Tippins and Johnson, which
provide that if the employee's employment is terminated during the three-year
period following a Change in Control of the Company, as defined in the
agreements, other than for cause or by the employee for other than "good
reason," the employee will continue to be paid his base salary, participate in
the Bonus Plan and receive certain other benefits for the remainder of such
three-year period, reduced by any amounts payable to the employee (i) pursuant
to a Retirement Agreement and (ii) from other employment.
STOCK OPTION PLANS
The Company's 1998 Equity Incentive Plan provides for the grant of stock
options, SARs, restricted stock, dividend equivalents, performance units,
phantom shares, limited stock appreciation rights ("LSARs"), bonus stock and
cash tax rights to (i) all officers and employees of, and any consultants to,
the Company or any affiliate of the Company as determined by the the Company's
Compensation Committee and (ii) the nonemployee directors of the Company who
receive automatic grants of Director options with tandem LSARs and Special
Director Options if approved by the Company's stockholders. The maximum
15
<PAGE>
number of shares of Tech-Sym Common Stock as to which options or SARs may be
granted under the 1998 Equity Incentive Plan is 750,000 shares, subject to
certain adjustments to prevent dilution. The exercise price of such options and
SARs may not be less than 100% of the fair market value per share of the Tech-
Sym Common Stock on the date of grant. The 1998 Equity Incentive Plan provides
that, upon a change in control of the Company, all outstanding stock options,
SARs, and other awards under the plan would become immediately vested and
exercisable (with certain exceptions).
The GeoScience 1996 Equity Incentive Plan provides for the grant of stock
options, SARs, restricted stock, dividend equivalents, performance units,
phantom shares, limited stock appreciation rights ("LSARs"), bonus stock and
cash tax rights to (i) all officers and employees of, and any consultants to,
GeoScience or any affiliate of GeoScience as determined by the GeoScience
Compensation Committee and (ii) the directors of GeoScience who are not
employees or consultants of GeoScience or an affiliate who receive only
automatic grants of Director options with tandem LSARs. The maximum number of
shares of GeoScience Common stock as to which options or SARs may be granted
under the 1996 Equity Incentive Plan is 1,500,000 shares, subject to certain
adjustments to prevent dilution. The exercise price of such options and SARs may
not be less than 100% of the fair market value per share of the GeoScience
Common Stock on the date of grant. The 1996 Equity Incentive Plan provides that,
upon a change in control of the Company or, if GeoScience ceases to be a
subsidiary of the Company, a change of control of GeoScience, all outstanding
stock options, SARs, and other awards under the plan would become immediately
vested and exercisable (with certain exceptions).
SHARE INVESTMENT PERFORMANCE
The following graph reflects a comparison of the cumulative total return
(change in stock price plus reinvested dividends) of the Company's Common Stock
from December 31, 1992, through December 31, 1997, with the cumulative total
returns reflected in the Media General Financial Services (MGFS) Composite
Market Value Index (a broad market index which includes over 7,000 publicly held
companies) and the MGFS Industry Group 837 Index -- Scientific/Tech Instruments
(a market index reflecting performance of the Company's peers and which includes
the Company). The MGFS Industry Group 171 -- Electronic Equipment Manufacturers
used in previous share investment performance graphs was not used in this proxy
statement because MGSF no longer supports that group due to an internal
restructuring of its industry group classification system in 1998. The data
presented assumes a hypothetical investment of $100 in the Company's stock and
in the underlying stocks of each of the two indices as of January 1, 1994, and
that all dividends were reinvested.
16
<PAGE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
[LINEAR GRAPH PLOTTED FROM DATA IN TABLE BELOW]
<TABLE>
<CAPTION>
FISCAL YEAR ENDING
------------------------------------------------------------
1993 1994 1995 1996 1997 1998
---- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
TECH-SYM CORPORATION................. 100 110.59 148.82 140.00 119.71 104.71
SCIENTIFIC/TECH INSTRUMENT
COMPANIES.......................... 100 114.00 156.58 182.81 226.27 227.51
COMPOSITE MARKET VALUE............... 100 99.17 128.58 155.28 201.64 246.49
</TABLE>
ASSUMES $100 INVESTED ON JAN. 1, 1994
ASSUMES DIVIDENDS REINVESTED
FISCAL YEAR ENDING DEC. 31, 1998
The foregoing price performance comparisons shall not be deemed
incorporated by reference by any general statement incorporating by reference
this Proxy Statement into any filing under the Securities Act or under the
Exchange Act, except to the extent that the Company specifically incorporates
this graph by reference, and shall not otherwise be deemed filed under such
Acts.
There can be no assurance that the Company's share performance will
continue into the future with the same or similar trends depicted in the graph
above. The Company will not make or endorse any predictions as to future share
performance.
17
<PAGE>
RATIFICATION OF INDEPENDENT ACCOUNTANTS
PROPOSAL 2: THE BOARD OF DIRECTORS HAS UNANIMOUSLY SELECTED
PRICEWATERHOUSECOOPERS LLP, CERTIFIED PUBLIC ACCOUNTANTS, AND URGES YOU TO VOTE
FOR THE RATIFICATION OF THE APPOINTMENT OF SUCH FIRM, AS INDEPENDENT ACCOUNTANTS
OF THE COMPANY FOR THE YEAR 1999. PROXIES SOLICITED HEREBY WILL BE SO VOTED
UNLESS STOCKHOLDERS SPECIFY OTHERWISE IN THEIR PROXIES. PROPOSAL 2 WILL BE
ADOPTED IF A QUORUM IS PRESENT AND THE VOTES CAST IN FAVOR OF THE PROPOSAL
EXCEED THE VOTES CAST AGAINST THE PROPOSAL.
By action of the Board of Directors, pursuant to the recommendation of the
Audit Committee, PricewaterhouseCoopers LLP has been selected as independent
accountants to audit the accounts of the Company for the year ending December
31, 1999, and the Board of Directors proposes the ratification of such
selection. PricewaterhouseCoopers LLP and its predecessor, Price Waterhouse LLP,
have audited the accounts of the Company since 1967. A representative of such
firm is expected to be present at the annual meeting of stockholders with the
opportunity to make a statement if such representative desires to do so and will
be available to answer appropriate questions.
APPROVAL OF THE SECOND AMENDED AND RESTATED
1998 EQUITY INCENTIVE PLAN
PROPOSAL 3: THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED AND URGES YOU
TO VOTE FOR APPROVAL OF THE SECOND AMENDED AND RESTATED 1998 EQUITY INCENTIVE
PLAN, WHICH PROVIDES FOR A SPECIAL GRANT OF STOCK OPTIONS TO OUTSIDE DIRECTORS
WITHOUT INCREASING THE NUMBER OF SHARES PREVIOUSLY AUTHORIZED BY THE
STOCKHOLDERS FOR STOCK AND STOCK-RELATED AWARDS. PROXIES WILL BE SO VOTED UNLESS
THE STOCKHOLDERS SPECIFY OTHERWISE IN THEIR PROXIES. PROPOSAL 3 WILL BE ADOPTED
IF A QUORUM IS PRESENT AND THE VOTES CAST IN FAVOR OF THE PROPOSAL EXCEED THE
VOTES CAST OPPOSING THE PROPOSAL.
The Board recommends the approval of the Second Amended and Restated
Tech-Sym Corporation 1998 Equity Incentive Plan (the "Amended Plan"), which
authorizes the grant of additional stock options to nonemployee Directors of the
Company ("Special Director Options"). Approval of the Amended Plan will NOT
require the authorization of additional shares of Common Stock to be reserved
for the Plan. All Special Director Options will come from the 750,000 shares
currently reserved for the Plan.
The Company's 1998 Equity Incentive Plan (the "Plan") was approved by the
stockholders at the 1998 Annual Meeting of Stockholders. The Plan was
subsequently amended by the Board of Directors, pursuant to the recommendation
of the Compensation Committee, to place limits on any grants of restricted or
bonus stock and to increase the annual automatic grant of stock options to
nonemployee Directors from 2,000 to 5,000 shares of Common Stock. Due to the
general decline of the stock market and the adverse effect such a decline had on
the market price of the Company's stock, the Compensation Committee repriced
certain employee stock options on October 15, 1998, provided such employees
agreed to certain additional conditions on the exercise of the options. The
Director stock options were not repriced. However, the Compensation Committee
recommended, and the Board of Directors approved, an amendment to the Plan
granting a stock option of 6,000 shares for each of the five nonemployee
directors at an exercise price equal to 100% of the closing market price of the
Company's stock that day which was $21.25 per share. These Special Director
Options cannot be exercised until one year after their date of grant. The Plan
amendment was conditioned upon approval by the Company's stockholders.
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The following table sets forth the benefits that will be received by the
five nonemployee directors under the Amended Plan, if approved.
NEW PLAN BENEFITS
TECH-SYM CORPORATION
1998 EQUITY INCENTIVE PLAN
(SECOND AMENDMENT AND RESTATEMENT)
<TABLE>
<CAPTION>
DOLLAR NUMBER
NAME AND POSITION VALUE($)(A) OF UNITS(B)
- ------------------------------------- ------------ -----------
<S> <C> <C>
Non-Executive Director Group(c)...... 276,000 30,000
</TABLE>
- ------------
(a) The Black-Scholes option pricing model was used to estimate the value of
the Special Director Options to be $9.20 per option share as of the grant
date. The following assumptions were used for the purpose of estimating
the value: (i) option term of 8 years, (ii) volatility of 28%, (iii)
dividend yield of zero, and (iv) risk-free rate of return of 4.26%.
(b) Number of shares of Common Stock underlying the Special Director Options.
(c) The group consists of Messrs. Creech, Forrest, Gallotta, Kraft, and Watt
in equal amounts.
The full text of the Amended Plan is set forth in Exhibit A to this Proxy
Statement.
OTHER MATTERS
The Board of Directors of the Company knows of no business to be presented
at the annual meeting other than that stated in the notice of such meeting. In
the event, however, that other matters properly come before the meeting or any
adjournment thereof, it is intended that the persons named in the accompanying
Proxy and acting thereunder will vote in accordance with their best judgment.
Regardless of the number of shares owned by you, it is important that they
be represented at the meeting, and you are respectfully requested to sign, date
and return the accompanying Proxy at your earliest convenience.
ANNUAL REPORT
The annual report to stockholders, including consolidated financial
statements for the years ended December 31, 1998 and 1997, has been mailed to
all stockholders.
FORM 10-K REPORT
UPON THE WRITTEN REQUEST OF EACH STOCKHOLDER SOLICITED HEREBY, ADDRESSED TO
THE COMPANY, ATTENTION: J. RANKIN TIPPINS, SECRETARY, 10500 WESTOFFICE DRIVE,
SUITE 200, HOUSTON, TEXAS 77042-5391, THE COMPANY WILL PROVIDE WITHOUT CHARGE A
COPY OF ITS ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 13A-1 UNDER THE SECURITIES EXCHANGE ACT OF 1934 FOR
THE YEAR ENDED DECEMBER 31, 1998. THE COMPANY'S ANNUAL REPORT ON FORM 10-K IS
ALSO AVAILABLE THROUGH THE U.S. SECURITIES AND EXCHANGE COMMISSION HOME PAGE AT
HTTP://WWW.SEC.GOV.
By Order of the Board of Directors.
J. RANKIN TIPPINS
GENERAL COUNSEL AND SECRETARY
April 9, 1999
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EXHIBIT A
TECH-SYM CORPORATION
1998 EQUITY INCENTIVE PLAN
(SECOND AMENDMENT AND RESTATEMENT)
Tech-Sym Corporation, a Nevada corporation (the "Company"), hereby amends
and restates this Tech-Sym Corporation 1998 Equity Incentive Plan (the
"Plan"), effective as of October 15, 1998, subject to stockholder approval.
1. PURPOSE. The purpose of the Plan is to promote the interests of the
Company by encouraging employees of, and consultants to, the Company and its
Affiliates and the directors of the Company who are not also employees of the
Company or an Affiliate, to acquire or increase their equity interests in the
Company and to provide a means whereby such persons may develop a sense of
proprietorship and personal involvement in the development and financial success
of the Company, and to encourage them to remain with and devote their best
efforts to the business of the Company, thereby advancing the interests of the
Company and its stockholders. The Plan is also contemplated to enhance the
ability of the Company and its Affiliates to attract and retain the services of
individuals who are believed to be essential for the growth and profitability of
the Company.
2. DEFINITIONS. As used in this Plan:
(a) "AFFILIATE" means, at any time, any corporation, partnership or
other entity in which the Company, directly or indirectly, has a
significant equity interest, as determined by the Committee.
(b) "APPRECIATION RIGHT" means a right granted pursuant to
Paragraph 5.
(c) "AWARD" means an Option Right, an Appreciation Right, a
Director Option, Phantom Shares, a Performance Unit, Bonus Stock,
Restricted Stock or a Cash Tax Right.
(d) "BOARD" means the Board of Directors of the Company.
(e) "BONUS STOCK" means unrestricted shares of Common Stock granted
pursuant to Paragraph 9.
(f) "CASH TAX RIGHT" means a right granted pursuant to Paragraph
10.
(g) "CHANGE IN CONTROL" shall occur if:
(i) any "person," as such term is used on Section 13(d)
and 14(d) of the Exchange Act (other than the Company or any
employee benefit plan of the Company) together with its
"affiliates" and "associates," as such terms are defined in
Rule 12b-2 of the Exchange Act, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing
25% or more of the combined voting power of the Company's then
outstanding securities;
(ii) during any period of two consecutive years (not
including any period prior to the effective date of this Plan),
individuals who at the beginning of such period constitute the
Board, and any new director (other than a director designated by a
person who has entered into an agreement with the Company to
effect a transaction described in clause (i), (iii) or (iv) of
this definition) whose election by the Board or nomination for
election by the Company's stockholders was approved by a vote of
at least two-thirds of the directors then
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still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously
so approved, cease for any reason to constitute at least a
majority thereof;
(iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other company other than (1)
a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity)
more than 80% of the combined voting power of the voting
securities of the Company (or such surviving entity) outstanding
immediately after such merger or consolidation, or (2) a merger or
consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no "person" (as
hereinabove defined) acquires more than 25% of the combined voting
power of the Company's then outstanding securities; or
(iv) the stockholders of the Company adopt a plan of
complete liquidation of the Company or approve an agreement for
the sale, exchange or disposition by the Company of all or a
significant portion of the Company's assets. For purposes of this
clause (iv), the term "the sale, exchange or disposition by the
Company of all or a significant portion of the Company's assets"
shall mean a sale or other disposition transaction or series of
related transactions involving assets of the Company or any
subsidiary (including the stock of any subsidiary) in which the
value of the assets or stock being sold or otherwise disposed of
(as measured by the purchase price being paid therefor or by such
other method as the Board determines is appropriate in a case
where there is no readily ascertainable purchase price)
constitutes more than 25% of the fair market value of the Company
(as hereinafter defined). For purposes of the preceding sentence,
the "fair market value of the Company" shall be the aggregate
market value of the outstanding shares of common stock of the
Company (on a fully diluted basis) plus the aggregate market value
of the Company's other outstanding equity securities. The
aggregate market value of the shares of common stock of the
Company shall be determined by multiplying the number of shares of
the Company's common stock (on a fully diluted basis) outstanding
on the date of the execution and delivery of a definitive
agreement with respect to the transaction or series of related
transactions (the "Transaction Date") by the average closing
price of the shares of common stock of the Company for the ten
trading days immediately preceding the Transaction Date. The
aggregate market value of any other equity securities of the
Company shall be determined in a manner similar to that prescribed
in the immediately preceding sentence for determining the
aggregate market value of the shares of common stock of the
Company or by such other method as the Board shall determine is
appropriate.
(h) "CODE" means the Internal Revenue Code of 1986, as in effect
from time to time.
(i) "COMMITTEE" means the Compensation Committee of the Board.
(j) "COMMON STOCK" means the Common Stock, $0.10 par value, of the
Company or any security into which such Common Stock may be changed by
reason of any transaction or event of the type described in Paragraph 14.
(k) "DATE OF GRANT" means (i) with respect to an Award other than a
Director Option, the date specified by the Committee on which such Award
will become effective (which date will not be earlier
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than the date on which the Committee takes action with respect thereto) and
(ii) with respect to a Director Option, the automatic date of grant as
provided in Paragraph 11.
(l) "DIRECTOR" means a member of the Board who is not also an
employee of, or consultant to, the Company or an Affiliate.
(m) "DIRECTOR OPTION" means the right to purchase a share of Common
Stock upon exercise of an option granted pursuant to Paragraph 11.
(n) "DIVIDEND EQUIVALENT" means, with respect to an Option Right or
Phantom Share, an amount equal to the amount of any dividends that are
declared and become payable after the Date of Grant for such Award and on
or before the date such Award is exercised, paid or forfeited, as the case
may be.
(o) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
(p) "GRANT PRICE" means the price per share of Common Stock at
which an Appreciation Right not granted in tandem with an Option Right is
granted.
(q) "MARKET VALUE PER SHARE" means, at any date, the closing sale
price per share of the Common Stock on that date (or, if there are no sales
on that date, the last preceding date on which there was a sale) in the
principal market in which the Common Stock is traded.
(r) "OPTION PRICE" means the purchase price per share payable on
exercise of an Option Right or Director Option.
(s) "OPTION RIGHT" means the right to purchase a share of Common
Stock upon exercise of an option granted pursuant to Paragraph 4.
(t) "PARTICIPANT" means an employee of, or consultant to, the
Company or any of its Affiliates who is selected by the Committee to
receive an Award under any of Paragraphs 4 through 10 and shall also
include a Director who has received an automatic grant of Director Options
pursuant to Paragraph 11.
(u) "PERFORMANCE OBJECTIVES" means the objectives, if any,
established by the Committee that are to be achieved with respect to an
Award granted under this Plan, which may be described in terms of
Company-wide objectives, in terms of objectives that are related to
performance of a division, Subsidiary, department or function within the
Company or a Subsidiary in which the Participant receiving the Award is
employed or in individual or other terms, and which will relate to the
period of time (Performance Cycle) determined by the Committee. The
Performance Objectives intended to qualify under Section 162(m) of the Code
shall be with respect to one or more of the following (i) net earnings;
(ii) operating income; (iii) earnings before interest and taxes ("EBIT");
(iv) earnings before interest, taxes, depreciation, and amortization
expenses ("EBITDA"); (v) earnings before taxes and unusual or
nonrecurring items; (vi) revenue; (vii) return on investment; (viii) return
on equity; (ix) return on total capital; (x) return on assets; (xi) total
stockholder return; (xii) return on capital employed in the business;
(xiii) stock price performance; (xiv) earnings per share growth; and (xv)
cash flows. Which objectives to use with respect to an Award, the weighting
of the objectives if more than one is used, and whether the objective is to
be measured against a Company-established budget or target, an index or a
peer group of companies, shall be determined by the Committee in its
discretion at the time of grant of the Award. A Performance Objective need
not be based on an increase or a positive result and may include, for
example, maintaining the status quo or limiting economic losses. The
Committee, in its sole discretion and without the consent of the
Participant, may amend (i)
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any stock-based Award to reflect (1) a change in corporate capitalization,
such as a stock split or dividend, (2) a corporate transaction, such as a
corporate merger, a corporate consolidation, any corporate separation
(including a spinoff or other distribution of stock or property by a
corporation), any corporate reorganization (whether or not such
reorganization comes within the definition of such term in Section 368 of
the Code), (3) any partial or complete corporate liquidation, or (4) a
change in accounting rules required by the Financial Accounting Standards
Board and (ii) any Award that is not intended to meet the requirements of
Section 162(m) of the Code, to reflect significant event that the
Committee, in its sole discretion, believes to be appropriate to reflect
the original intent in the grant of the Award. With respect to an Award
that is subject to Section 162(m) of the Code, the Committee must first
certify that the Performance Objectives have been achieved before the Award
may be paid.
(v) "PERFORMANCE UNIT" means a unit equivalent to $100 (or such
other value as the Committee determines) awarded pursuant to Paragraph 8.
(w) "PHANTOM SHARES" means notional shares of Common Stock awarded
pursuant to Paragraph 7.
(x) "RESTRICTED STOCK" means shares of Common Stock granted or sold
pursuant to Paragraph 6 as to which neither the ownership restrictions nor
the restriction on transfers referred to therein has expired.
(y) "RULE 16B-3" means Rule 16b-3 of the Securities and Exchange
Commission (or any successor rule to the same effect) as in effect from
time to time.
(z) "SPREAD" means the amount determined by multiplying (i) the
excess of the Market Value per Share on the date when an Appreciation Right
is exercised over the Option Price provided for in the related Option Right
or, if there is no tandem Option Right, the Grant Price provided for in the
Appreciation Right by (ii) the number of shares of Common Stock in respect
of which the Appreciation Right is exercised.
(aa) "SUBSIDIARY" means, at any time, any corporation in which at
the time the Company then owns or controls, directly or indirectly, not
less than 50% of the total combined voting power represented by all classes
of stock issued by such corporation.
3. SHARES AVAILABLE UNDER PLAN. Subject to adjustments as provided in
Paragraph 14, 750,000 is the maximum number of shares of Common Stock which may
be issued or transferred and covered by all outstanding Awards under this Plan,
of which number no more than 150,000 shares may be issued or transferred as
Restricted Stock and/or Phantom Shares, the vesting of which is not subject to
the achievement of Performance Objectives, and/or as Bonus Stock. Such shares
may be shares of original issuance or treasury shares or a combination of the
foregoing. Upon exercise of any Appreciation Rights or the payment of any
Phantom Shares, there will be deemed to have been delivered under this Plan for
purposes of this Paragraph 3 the number of shares of Common Stock covered by the
Appreciation Rights or equal to the Phantom Shares, as applicable, regardless of
whether such Appreciation Rights or Phantom Shares were paid in cash or shares
of Common Stock. Subject to the provisions of the preceding sentence, any shares
of Common Stock which are subject to Option Rights, Appreciation Rights, or
Phantom Shares awarded or sold as Restricted Stock that are terminated
unexercised, forfeited or surrendered or which expire for any reason will again
be available for issuance under this Plan. No person may receive Appreciation
Rights, Option Rights, Phantom Shares, Bonus Stock and Restricted Stock awards
with respect to more than 250,000 shares during any calendar year; but
disregarding any Appreciation Rights
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granted in tandem with any Option Rights granted that year. Similarly, the
maximum value of Performance Units that may be granted to any person during any
calendar may not exceed $1 million.
4. OPTION RIGHTS. The Committee may from time to time authorize grants to
any Participant (other than a Director) of options to purchase shares of Common
Stock upon such terms and conditions as it may determine in accordance with the
following provisions:
(a) Each grant will specify the number of shares of Common Stock to
which it pertains and whether Dividend Equivalents are awarded with respect
to the option, and; if awarded, the payment or crediting of such Dividend
Equivalents.
(b) Each grant will specify its Option Price, which may not be less
than 100% of the Market Value per Share on the Date of Grant.
(c) Each grant will specify that the Option Price will be payable (i)
in cash or by check payable and acceptable to the Company or (ii) to the
extent provided in the grant agreement, (a) by tendering (actually or
constructively) to the Company shares of Common Stock owned by the optionee
(for more than six months if acquired pursuant to the prior exercise of an
Option Right) having an aggregate Market Value Per Share as of the date of
exercise and tender that is not greater than the full Option Price for the
shares with respect to which the option is being exercised and by paying
any remaining amount of the Option Price as provided in (i) above or (b) by
the optionee delivering to the Company a properly executed exercise notice
together with irrevocable instructions to a broker to promptly deliver to
the Company cash or a check payable and acceptable to the Company to pay
the Option Price and any required tax withholding amounts; provided that in
the event the optionee chooses to pay the Option Price as provided in
(ii)(b) above, the optionee and the broker shall comply with such
procedures and enter into such agreements of indemnity and other agreements
as the Committee shall prescribe as a condition of such payment procedure,
or (iii) by a combination of such payment methods. Payment instruments will
be received subject to collection.
(d) Successive grants may be made to the same Participant whether or
not any Option Rights previously granted to such Participant remain
unexercised.
(e) Each grant will specify the required period or periods of
continuous service by the Participant with the Company and the Affiliates
and/or the Performance Objectives (if any) to be achieved before the Option
Rights or installments thereof will become exercisable, and any grant may
provide for the earlier exercise of the Option Rights in the event of a
Change in Control or other corporate transaction or event or upon
termination of the Participant's employment due to death, disability,
retirement or otherwise, including an involuntary termination other than
for cause.
(f) Each grant the exercise of which, or the timing of the exercise
of which, is dependent, in whole or in part, on the achievement of
Performance Objectives may specify a minimum level of achievement in
respect of the specified Performance Objectives below which no Options
Rights will be exercisable and may set forth a formula or other method for
determining the number of Option Rights that will be exercisable if
performance is at or above such minimum but short of full achievement of
the Performance Objectives.
(g) Option Rights granted under this Plan may be (i) options which
are intended to qualify as incentive stock options under Section 422 of the
Code, provided, however, such options may only be granted to employees of
the Company, its parent corporation and subsidiaries of the Company, (ii)
options which are not intended to so qualify or (iii) combinations of the
foregoing.
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(h) Option Rights granted to a Participant who is an officer of the
Company or a Subsidiary may, in the discretion of the Committee, provide
for an automatic "reload" grant upon the exercise of the Option Right,
with such terms and conditions on any such reload grant as the Committee
may choose, provided, however, the Option Price may not be less than 100%
of the Market Value per Share on the Date of Grant of the reload option and
its term may not exceed the remaining term for the exercised option.
(i) Each grant may, in the discretion of the Committee, provide that
the Common Stock acquired upon exercise of the Option Right shall remain
subject to "forfeiture" upon such terms and conditions as the Committee
may determine.
(j) Each grant shall specify the period during which the Option Right
may be exercised, but no Option Right will be exercisable more than ten
years from the Date of Grant.
(k) Each grant of Option Rights will be evidenced by an agreement
executed on behalf of the Company by any officer and delivered to the
Participant and containing such terms and provisions, consistent with this
Plan, as the Committee may approve.
5. APPRECIATION RIGHTS. The Committee may also from time to time
authorize grants to any Participant (other than a Director) of Appreciation
Rights upon such terms and conditions as it may determine in accordance with
this Paragraph. Appreciation Rights may be granted in tandem with Option Rights
or separate and apart from a grant of Option Rights. An Appreciation Right will
be a right of the Participant granted such Award to receive from the Company,
upon exercise, an amount which will be determined by the Committee at the Date
of Grant and will be expressed as a percentage of the Spread (not exceeding
100%) at the time of exercise. An Appreciation Right granted in tandem with an
Option Right may be exercised only by surrender of the related Option Right.
Each grant of an Appreciation Right may utilize any or all of the
authorizations, and will be subject to all of the limitations, contained in the
following provisions:
(a) Each grant will state whether it is made in tandem with Option
Rights and, if not made in tandem with any Option Rights, will specify the
number of shares of Common Stock in respect of which it is made.
(b) Each grant made in tandem with Option Rights will specify the
Option Price and each grant not made in tandem with Option Rights will
specify the Grant Price, which in either case will not be less than 100% of
the Market Value per Share on the Date of Grant.
(c) Any grant may specify that the amount payable on exercise of an
Appreciation Right may be paid by the Company in (i) cash or Company check,
(ii) shares of Common Stock having an aggregate Market Value per Share
equal to the Spread or (iii) any combination thereof, as determined by the
Committee in its sole discretion.
(d) Any grant may specify that the amount payable on exercise of an
Appreciation Right may not exceed a maximum specified by the Committee at
the Date of Grant (valuing shares of Common Stock for this purpose at their
Market Value per Share at the date of exercise).
(e) Each grant will specify the required period or periods of
continuous service by the Participant with the Company and its Affiliates
and/or Performance Objectives to be achieved before the Appreciation Rights
or installments thereof will become exercisable, and will provide that no
Appreciation Right may be exercised except at a time when the Spread is
positive and, with respect to any grant made in tandem with Option Rights,
when the related Option Right is also exercisable. Any grant may provide
for the earlier exercise of the Appreciation Rights in the event of a
Change in
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Control or other corporate transaction or event or upon the Participant's
termination due to death, disability or retirement, including an
involuntary termination other than for cause.
(f) Each grant the exercise of which, or the timing of the exercise
of which, is dependent, in whole or in part, on the achievement of
Performance Objectives may specify a minimum level of achievement in
respect of the specified Performance Objectives below which no Appreciation
Rights will be exercisable and may set forth a formula or other method for
determining the number of Appreciation Rights that will be exercisable if
performance is at or above such minimum but short of full achievement of
the Performance Objectives.
(g) Each grant of an Appreciation Right will be evidenced by an
agreement executed on behalf of the Company by any officer and delivered to
and accepted by the Participant receiving the grant, which agreement will
describe such Appreciation Right, identify any Option Right granted in
tandem with such Appreciation Right, state that such Appreciation Right is
subject to all the terms and conditions of this Plan and contain such other
terms and provisions, consistent with this Plan, as the Committee may
approve.
6. RESTRICTED STOCK. The Committee may also from time to time authorize
grants or sales to any Participant (other than a Director) of Restricted Stock
upon such terms and conditions as it may determine in accordance with the
following provisions:
(a) Each grant or sale will constitute an immediate transfer of the
ownership of shares of Common Stock to the Participant in consideration of
the performance of services, entitling such Participant to voting and other
ownership rights, but subject to the restrictions hereinafter referred to.
Each grant or sale may limit the Participant's dividend rights during the
period in which the shares of Restricted Stock are subject to any such
restrictions.
(b) Each grant or sale will specify the Performance Objectives, if
any, that are to be achieved in order for the ownership restrictions to
lapse. Each grant or sale that is subject to the achievement of Performance
Objectives will specify a minimum acceptable level of achievement in
respect of the specified Performance Objectives below which the shares of
Restricted Stock will be forfeited and may set forth a formula or other
method for determining the number of shares of Restricted Stock with
respect to which restrictions will lapse if performance is at or above such
minimum but short of full achievement of the Performance Objectives.
(c) Each such grant or sale may be made without additional
consideration or in consideration of a payment by such Participant that is
less than the Market Value per Share at the Date of Grant.
(d) Each such grant or sale will provide that the shares of
Restricted Stock covered by such grant or sale will be subject, for a
period to be determined by the Committee at the Date of Grant, to one or
more restrictions, including, without limitation, a restriction that
constitutes a "substantial risk of forfeiture" within the meaning of
Section 83 of the Code and the regulations thereunder; provided, however,
with respect to any such Award that is intended on its Date of Grant to be
on a "performance based" Award under Section 162(m) of the Code, the
minimum restricted period shall be one year, and, with respect to any such
Award that is not intended on its Date of Grant to be such a "performance
based" Award, the minimum restricted period shall be three years.
Notwithstanding the foregoing however, any grant or sale may provide for
the earlier termination of such period in the event of a Change in Control
or other corporate transaction or event or upon termination of the
Participant's employment due to death, disability, retirement or otherwise,
including an involuntary termination other than for cause, to the extent
the inclusion of such acceleration provision(s) on the
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Date of Grant would not preclude an Award intended to be "performance
based" under section 162(m) from so qualifying.
(e) Each such grant or sale will provide that during the period for
which such restriction or restrictions are to continue, the transferability
of the Restricted Stock will be prohibited or restricted in a manner and to
the extent prescribed by the Committee at the Date of Grant (which
restrictions may include, without limitation, rights of repurchase or first
refusal in the Company or provisions subjecting the Restricted Stock to
continuing restrictions in the hands of any transferee).
(f) Each grant or sale of Restricted Stock will be evidenced by an
agreement executed on behalf of the Company by any officer and delivered to
and accepted by the Participant and containing such terms and provisions,
consistent with this Plan, as the Committee may approve.
(g) Unless otherwise approved by the Committee, certificates
representing shares of Common Stock transferred pursuant to a grant of
Restricted Stock will be held in escrow pursuant to an agreement
satisfactory to the Committee until such time as the restrictions on
transfer have expired or the shares have been forfeited.
7. PHANTOM SHARES. The Committee may also from time to time authorize
grants to any Participant (other than a Director) of Phantom Shares upon such
terms and conditions as it may determine in accordance with the following
provisions:
(a) Each grant will specify the number of Phantom Shares to which it
pertains and the payment or crediting of any Dividend Equivalents with
respect to such Phantom Shares.
(b) Each grant will specify the Performance Objectives, if any, that
are to be achieved in order for the Phantom Shares to be earned. Each grant
that is subject to the achievement of Performance Objectives will specify a
minimum acceptable level of achievement in respect of the specified
Performance Objectives below which the Phantom Shares will be forfeited and
may set forth a formula or other method for determining the number of
Phantom Shares to be earned if performance is at or above such minimum but
short of full achievement of the Performance Objectives.
(c) Each grant will specify the time and manner of payment of Phantom
Shares which have been earned, which payment may be made in (i) cash, (ii)
shares of Common Stock or (iii) any combination thereof, as determined by
the Committee in its sole discretion.
(d) Each grant of Phantom Shares will be evidenced by an agreement
executed on behalf of the Company by any officer and delivered to and
accepted by the Participant and containing such terms and provisions,
consistent with this Plan, as the Committee may approve, including
provisions relating to a Change in Control or other corporate transaction
or event or upon the Participant's termination due to death, disability or
retirement or otherwise, including an involuntary termination other than
for cause.
8. PERFORMANCE UNITS. The Committee may also from time to time authorize
grants to any Participant (other than a Director) of Performance Units upon such
terms and conditions as it may determine in accordance with the following
provisions:
(a) Each grant will specify the number of Performance Units to which
it pertains.
(b) Each grant will specify the Performance Objectives that are to be
achieved in order for the Performance Units to be earned. Each grant will
specify a minimum acceptable level of achievement in respect of the
specified Performance Objectives below which no payment will be made and
may set
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forth a formula or other method for determining the amount of payment to be
made if performance is at or above such minimum but short of full
achievement of the Performance Objectives.
(c) Each grant will specify the time and manner of payment of
Performance Units which have become payable, which payment may be made in
(i) cash, (ii) shares of Common Stock having an aggregate Market Value per
Share equal to the aggregate value of the Performance Units which have
become payable or (iii) any combination thereof, as determined by the
Committee in its sole discretion at the time of payment.
(d) Each grant of a Performance Unit will be evidenced by an
agreement executed on behalf of the Company by any officer and delivered to
and accepted by the Participant and containing such terms and provisions,
consistent with this Plan, as the Committee may approve, including
provisions relating to a Change in Control or other corporate transaction
or event or upon the Participant's termination of employment due to death,
disability, retirement or otherwise, including an involuntary termination
other than for cause.
9. BONUS STOCK. The Committee may also from time to time authorize grants
to any Participant (other than a Director) of Bonus Stock, which shall
constitute a transfer of shares of Common Stock, without other payment therefor,
as additional compensation for the Participant's services to the Company or its
Affiliates, provided, however, that no more than 10% of the shares of Common
Stock available for Awards under the Plan may be granted as Bonus Stock, but
excluding from this limitation all Bonus Stock grants made in lieu of salary or
cash bonuses having a value equal to the Bonus Stock Award.
10. CASH TAX RIGHTS.
(a) The Committee may also from time to time authorize grants to any
Participant (other than a Director) of Cash Tax Rights upon such terms and
conditions as it may determine in accordance with this Paragraph. Cash Tax
Rights may only be granted in tandem with an Award that is payable in
shares of Common Stock. A Cash Tax Right will be the right of the
Participant granted such Award to receive from the Company, upon receipt of
shares of Common Stock pursuant to the tandem Award, an amount of cash,
which will be determined by the Committee at the Date of Grant and will be
expressed as a percentage of the Market Value per Share (not exceeding
100%) of each share of Common Stock received upon payment of the tandem
Award.
(b) Each grant of a Cash Tax Right will (i) state the Award it is
made in tandem with and will specify the percentage of the Market Value per
Share that shall be payable in cash and (ii) be evidenced by an agreement
extended on behalf of the Company by any officer and delivered to and
accepted, by the Participant and containing such terms and provisions,
consistent with this Plan, as the Committee may approve, including
provisions relating to a Change in Control or other corporate transaction
or event or upon the Participant's termination of employment due to death,
disability, retirement or otherwise, including an involuntary termination
other than for cause.
11. DIRECTOR OPTIONS.
(a) Each Director who is elected or appointed to the Board for the
first time at or after the 1998 Annual Meeting of the Stockholders of the
Company shall automatically receive, on the date of his or her election or
appointment, a Director Option for 10,000 shares of Common Stock. In
addition, each person who is a Director on October 15, 1998, shall receive
on such date a Director Option for 6,000 shares of Common Stock ("Special
Director Options").
(b) On the day of the regular Annual Meeting of the Stockholders of
the Company in each year that this Plan is in effect (commencing with the
1999 Annual Meeting of Stockholders), each Director
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who is in office on that day and who was not elected or appointed for the
first time on such date shall automatically receive a Director Option for
5,000 shares of Common Stock.
(c) Each Director Option will be subject to all of the limitations
contained in the following provisions:
(i) Each Director Option shall be fully exercisable (vested) on
its Date of Grant, except for each Special Director Option which shall
be fully exercisable (vested) one year after its Date of Grant.
(ii) The Option Price of each Director Option shall be the Market
Value per Share on its Date of Grant.
(iii) Each Director Option may be exercised in full at one time or
in part from time to time by giving written notice to the Company,
stating the number of shares of Common Stock with respect to which the
Director Option is being exercised, accompanied by payment in full of
the Option Price for such shares, which payment may be (1) in cash by
check acceptable to the Company, (2) by tendering (actually or
constructively) to the Company shares of Common Stock owned by the
optionee (for more than six months if acquired pursuant to the prior
exercise of a Director Option) having an aggregate Market Value Per
Share as of the date of exercise and tender that is not greater than the
full option exercise price for the shares with respect to which the
Option is being exercised and by paying any remaining amount of the
option exercise price as provided (i) above, (3) by the optionee
delivering to the Company a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the
Company cash or a check payable and acceptable to the Company to pay the
option exercise price and any required tax withholding amounts; provided
that in the event the optionee chooses to pay the exercise price in this
manner, the optionee and the broker shall comply with such procedures
and enter into such agreements of indemnity and other agreements as the
Committee shall prescribe as a condition of such payment procedure, or
(4) by a combination of such methods of payment. Payment instruments
will be received subject to collection.
(iv) Each Director Option shall expire 10 years from the Date of
Grant thereof, but shall be subject to earlier termination as follows:
Director Options must be exercised within one year of Director ceasing
to be a member of the Board unless such termination results from the
Director's death, disability (as determined by the Committee) or
retirement (as determined by the Committee), in which case the Director
Options may be exercised by the optionee or the optionee's legal
representative or the person to whom the Director's rights shall pass by
will or the laws of descent and distribution, as the case may be, within
three years from the date of termination; provided however, that no such
event shall extend the normal expiration date of such Director Options.
(v) In the event that the number of shares of Common Stock
available for grants under this Plan is insufficient to make all
automatic grants provided for in this Paragraph 11 on the applicable
date, then all Directors who are entitled to a grant on such date shall
share ratably in the number of shares then available for grant under
this Plan, and shall have no right to receive a grant with respect to
the deficiencies in the number of available shares and all future grants
under this Paragraph 11 shall terminate.
(vi) Grants made pursuant to this Paragraph 11 shall be subject to
all of the terms and conditions of this Plan; however, if there is a
conflict between the terms and conditions of this Paragraph 11 and the
terms and conditions of any other Paragraph, then the terms and
conditions
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of this Paragraph 11 shall control. The Committee may not exercise any
discretion with respect to this Paragraph 11 which would be inconsistent
with the intent that this Plan meet the requirements of Rule 16b-3.
12. LSARS. Notwithstanding anything in Paragraphs 4, 5 or 11 above to the
contrary, if during the 60-day period following the date of a Change in Control
or, with respect to an option, Appreciation Right or Director Option granted to
a Participant who is subject to Section 16(b) of the Exchange Act, the 60-day
period following the earlier of the date that Section 16(b) of the Exchange Act
ceases to apply to such person or six months following the date of grant of such
option, Appreciation Right or Director Option (but not to exceed the remaining
term of such option, Appreciation Right or Director Option), a Participant (or
beneficiary thereof) elects to exercise an option, Appreciation Right or
Director Option, as applicable, the holder shall receive in cash whichever of
the following amounts is applicable:
(a) with respect to an acquisition of Common Stock described in
clause (i) of the definition of Change in Control, an amount equal to the
Acquisition Spread (as defined below);
(b) with respect to a change in composition of the Board described in
clause (ii) of the definition of Change in Control, an amount equal to the
Spread (as defined below); or
(c) with respect to stockholder approval of an agreement or adoption
of a plan described in clause (iii) or (iv) of the definition of Change in
Control, an amount equal to the Merger Spread (as defined below).
As used in this Paragraph 12, the following terms shall have the meaning
indicated:
(i) The term "Acquisition Price Per Share" shall mean the
greater of (i) the highest price paid by a person (or an Affiliate or
Associate thereof) for any share of Common Stock acquired prior to, but
in connection with, a Change in Control described in clause (i) of the
definition of a Change in Control or (ii) the highest Market Value per
Share for any day during the 60-day period ending on the date the
option, Appreciation Right or Director Option is exercised.
(ii) The term "Acquisition Spread" shall mean an amount equal to
the product obtained by multiplying (i) the excess of (A) the
Acquisition Price Per Share over (B) the price per share of Common Stock
at which the option, Appreciation Right or Director Option is
exercisable, by (ii) the number of shares of Common Stock with respect
to which such option, Appreciation Right or Director Option is being
exercised.
(iii) The term "Merger Price Per Share" shall mean the greater
of (i) the fixed or formula price for the acquisition of shares of
Common Stock specified in such agreement or adoption, if such fixed or
formula price is determinable on the date on which such option,
Appreciation Right or Director Option is exercised, and (ii) the highest
Market Value per Share for any day during the 60-day period ending on
the date on which such option, Appreciation Right or Director Option is
exercised.
(iv) The term "Merger Spread" shall mean an amount equal to the
product obtained by multiplying (i) the excess of (A) the Merger Price
Per Share over (B) the price per share of Common Stock at which the
option, Appreciation Right or Director Option is exercisable, by (ii)
the number of shares of Common Stock with respect to which such option,
Appreciation Right or Director Option is being exercised.
(v) The term "Spread" shall mean an amount equal to the product
obtained by multiplying (i) the excess of (A) the highest Market Value
per Share for any day during the 60-day period
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ending on the date the option, Appreciation Right or Director Option is
exercised over (B) the price per share of Common Stock at which the
option, Appreciation Right or Director Option is exercisable, by (ii)
the number of shares of Common Stock with respect to which such option,
Appreciation Right or Director Option is being exercised.
The Company intends that this Paragraph 12 shall comply with the
requirements of Rule 16b-3 and any future rules promulgated in substitution
therefor ("the Rule") under the Exchange Act during the term of the Plan.
Should any provision of this Paragraph 12 not be necessary to comply with the
requirements of the Rule or should any additional provisions be necessary for
this Paragraph 12 to comply with the requirements of the Rule, the Board may
amend the Plan to add to or modify the provisions of the Plan accordingly.
13. TRANSFERABILITY. Except as provided below, no Award will be
transferable by a Participant other than by will or the laws of descent and
distribution or pursuant to a qualified domestic relations order. Director
Options, Option Rights or Appreciation Rights will be exercisable during the
Participant's lifetime only by the Participant or by the Participant's guardian
or legal representative. The Committee may, in its discretion, adopt rules or
guidelines under which any option (other than an incentive stock option) granted
to a Participant may be transferred (in whole or in part pursuant to such form
as approved by the Company) by the Participant to (i) the spouse, children or
grandchildren of the Participant ("Immediate Family Members"), (ii) a trust or
trusts for the exclusive benefit of the Immediate Family Members and, if
applicable, the Participant, (iii) a partnership, limited liability company or
other entity in which such Immediate Family Members and, if applicable, the
Participant are the only partners, members or stockholders, or (iv) to other
persons or entities as approved by the Committee in its discretion. Following
transfer, any such option shall continue to be subject to the same terms and
conditions as were applicable to the option immediately prior to transfer;
provided, however, that no transferred option shall be exercisable or payable,
as the case may be, unless arrangements satisfactory to the Company have been
made to satisfy any tax withholding obligations the Company may have with
respect to the option.
14. ADJUSTMENTS. The Board may make or provide for such adjustments in
the maximum number of shares specified in Paragraph 3, in the numbers of shares
of Common Stock covered by outstanding Director Options, Option Rights,
Appreciation Rights and Phantom Shares granted hereunder, in the Option Price or
Grant Price applicable to any such Director Options, Option Rights and
Appreciation Rights, and/or in the kind of shares covered thereby (including
shares of another issuer), as the Board, in its sole discretion exercised in
good faith, may determine is equitably required to prevent dilution or
enlargement of the rights of Participants that otherwise would result from any
stock dividend, stock split, combination of shares, recapitalization or other
change in the capital structure of the Company, merger, consolidation,
reorganization, partial or complete liquidation, issuance of rights or warrants
to purchase securities or any other corporation transaction or event having an
effect similar to any of the foregoing.
15. FRACTIONAL SHARES. The Company will not be required to issue any
fractional share of Common Stock pursuant to this Plan. The Committee may
provide for the elimination of fractions for the settlement of fractions in
cash.
16. WITHHOLDING OF TAXES. To the extent that the Company is required to
withhold federal, state, local or foreign taxes in connection with any grant or
payment made to a Participant or any other person under this Plan, it will be a
condition to the receipt of such grant or payment that the Participant or such
other person make arrangements satisfactory to the Company for the payment of
such taxes. With respect to any Participant who is subject to Rule 16b-3 at the
time withholding is required, the Participant may direct the Company to withhold
from such Award, to the extent such withholding is not satisfied by a tandem
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Cash Tax Right, if any, a number of shares of Common Stock having an aggregate
Market Value per Share equal to the amount of taxes required to be withheld by
the Company.
17. PARACHUTE TAX GROSS-UP. To the extent that the acceleration of the
vesting or payment of any Award to a Participant (a "Benefit") is subject to
excise tax under Section 4999(a) of the Code (a "Parachute Tax"), the Company
shall pay such Participant an amount of cash (the "Gross-up Amount") such that
the "net" Benefit received by the Participant under this Plan, after paying
all applicable Parachute Taxes (including those on the Gross-up Amount) and any
taxes on the Gross-up Amount, shall be equal to the Benefit that such
Participant would have received if such Parachute Tax had not been applicable.
18. ADMINISTRATION OF THE PLAN.
(a) This Plan will be administered by the Committee. A majority of
the Committee will constitute a quorum, and the action of the members the
Committee present at any meeting at which a quorum is present, or acts
unanimously approved writing, will be the acts of the Committee.
(b) The interpretation and construction by the Committee of any
provision of this Plan or of any agreement, notification or document
evidencing the grant of an Award and any determination by the Committee
pursuant to any provision of this Plan or of any such agreement,
notification or documentation will be final and conclusive. No member of
the Committee will be liable for any such action or determination made in
good faith or in the absence of gross negligence or willful misconduct on
the part of such member.
19. AMENDMENTS, ETC.
(a) This Plan may be amended from time to time by the Board but may
not be amended without the approval by the stockholders of the Company if
such amendment would change the class of eligible Participants or increase
the number of shares available for Awards.
(b) This Plan will not confer upon any Participant any right with
respect to continuance of employment or other service with the Company or
any Affiliate, nor will it interfere in any way with any right the Company
or any Affiliate would otherwise have to terminate such Participant's
employment or other service at any time.
20. TERM. This Second Amended and Restated Plan shall be effective as of
October 15, 1998, subject to approval by the Company's stockholders; provided,
however, no Special Director Option shall be exercisable or payable prior to the
date of such stockholders' approval. Unless sooner terminated, this Plan shall
terminate on December 31, 2007, and no further Awards shall be made, but all
outstanding Awards on such date shall remain effective in accordance with their
terms and the terms of this Plan.
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FRONT SIDE OF PROXY
PROXY TECH-SYM CORPORATION PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoint(s) WENDELL W. GAMEL, J. MICHAEL CAMP and J.
RANKIN TIPPINS, or any of them, lawful attorneys and proxies of the undersigned
to vote as Proxy at the Annual Stockholders' Meeting of Tech-Sym Corporation
(herein the "Company") to be held on May 11, 1999, and any adjournment(s)
thereof, according to the number of votes owned by the undersigned as follows:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSALS NUMBERED 1, 2 AND 3.
<TABLE>
<S> <C> <C>
PROPOSAL 1. The Election of Directors: [ ] FOR nominees listed below [ ] WITHHOLD AUTHORITY
(except as marked to vote for all nominees
to the contrary below) listed below
</TABLE>
J. M. Camp, W. Creech, M. Forrest, R. Friedland, A. Gallotta,
W. Gamel, C. Scribner, C. Watt
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, WRITE THAT NOMINEE'S NAME HERE:
- -------------------------------------------------------------------------------
PROPOSAL 2: Ratification of the appointment of PricewaterhouseCoopers LLP as the
independent accountants of the Company for the year 1999.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PROPOSAL 3: To approve the Second Amended and Restated Tech-Sym Corporation 1998
Equity Incentive Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(continued and to be signed on other side)
- --------------------------------------------------------------------------------
BACK SIDE OF PROXY
In accordance with their discretion, said Attorneys and Proxies are authorized
to vote upon such other matters or proposals not known at the time of
solicitation of this proxy which 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, 2 AND 3. ANY PRIOR PROXY IS HEREBY REVOKED.
Dated: ___________________, 1999
________________________________
Signature
________________________________
(Signature if held jointly)
Please sign exactly as your name
appears at the left. When shares
are held by joint tenants, both
should sign. When signing as
attorney, executor,
administrator, trustee or
guardian, please give full title
as such. If a corporation,
please sign in full corporate
name by president or other
authorized person. If a
partnership, please sign in
partnership name by authorized
person.
PLEASE MARK, SIGN, DATE, AND
RETURN THIS PROXY CARD PROMPTLY,
USING THE ENCLOSED ENVELOPE.
THANK YOU.
