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SCHEDULE 14A
SCHEDULE 14A INFORMATION
Filed by the Registrantþ
Filed by a Party other than the Registranto
Check the appropriate box:
o Preliminary Proxy Statement
o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
þ Definitive Proxy Statement
o Definitive Additional Materials
o Soliciting Material Pursuant to Rule 14a-12
Intevac, Inc.
Payment of Filing Fee (Check the appropriate box): | ||||
þ | No fee required. | |||
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11 | |||
(1) Title of each class of securities to which transaction applies: | ||||
(2) Aggregate number of securities to which transaction applies: | ||||
(3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | ||||
(4) Proposed maximum aggregate value of transaction: | ||||
(5) Total fee paid: | ||||
o | Fee paid previously with preliminary materials. | |||
o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | |||
(1) Amount Previously Paid: | ||||
(2) Form, Schedule or Registration Statement No.: | ||||
(3) Filing Party: | ||||
(4) Date Filed: | ||||
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![INTEVAC LOGO](https://capedge.com/proxy/DEF 14A/0000950134-05-007330/f06691deintv1.gif)
Sincerely yours, | |
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Kevin Fairbairn | |
President and Chief Executive Officer |
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1. To elect directors to serve for the ensuing year or until their respective successors are duly elected and qualified. The nominees are Norman H. Pond, Kevin Fairbairn, David S. Dury, Stanley J. Hill, David N. Lambeth, Robert Lemos and Arthur L. Money. | |
2. To amend the Company’s Bylaws to increase the range of authorized number of directors to a range of five to nine. | |
3. To ratify the appointment of Grant Thornton LLP as independent accountants of Intevac for the fiscal year ending December 31, 2005. | |
4. To transact such other business as may properly come before the meeting or any adjournment thereof. |
BY ORDER OF THE BOARD OF DIRECTORS | |
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CHARLES B. EDDY III | |
Vice President, Finance and Administration, | |
Chief Financial Officer, Treasurer and Secretary |
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Name | Position(s) with Intevac | Age | ||||
Norman H. Pond | Chairman of the Board | 66 | ||||
Kevin Fairbairn | President and Chief Executive Officer | 51 | ||||
David S. Dury(1)(3) | Director | 56 | ||||
Stanley J. Hill(3) | Director | 63 | ||||
David N. Lambeth(2) | Director | 57 | ||||
Robert Lemos(1)(2) | Director | 64 | ||||
Arthur L. Money(1) | Director | 65 |
(1) | Member of the Audit Committee |
(2) | Member of the Compensation Committee |
(3) | Member of the Nominating and Governance Committee |
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• | The Committee periodically reviews the current composition, size and effectiveness of the Board. | |
• | In its evaluation of director candidates, including the members of the Board of Directors eligible for re-election, the Committee seeks to achieve a balance of knowledge, experience and capability on the Board and considers (1) the current size and composition of the Board of Directors and the needs of the Board of Directors and the respective committees of the Board, (2) such factors as issues of character, judgment, diversity, age, expertise, business experience, length of service, independence, other commitments and the like, (3) the relevance of the candidates’ skills and experience to our businesses and (4) such other factors as the Committee may consider appropriate. | |
• | While the Committee has not established specific minimum qualifications for director candidates, the Committee believes that candidates and nominees must reflect a Board that is comprised of directors who (1) are predominantly independent, (2) are of high integrity, (3) have broad, business-related knowledge and experience at the policy-making level in business, government or technology, including an understanding of our industry and our business in particular, (4) have qualifications that will increase overall Board effectiveness and (5) meet other requirements that may be required by applicable rules, such as financial literacy or financial expertise with respect to audit committee members. | |
• | With regard to candidates who are properly recommended by shareholders or by other means, the Committee will review the qualifications of any such candidate, which review may, in the Committee’s discretion, include interviewing references for the candidate, direct interviews with the candidate, or other actions that the Committee deems necessary or proper. | |
• | In evaluating and identifying candidates, the Committee has the authority to retain or terminate any third party search firm that is used to identify director candidates, and has the authority to approve the fees and retention terms of any search firm. | |
• | The Committee will apply these same principles when evaluating Board candidates who may be elected initially by the full Board either to fill vacancies or to add additional directors prior to the Annual Meeting of Shareholders at which directors are elected. | |
• | After completing its review and evaluation of director candidates, the Committee selects, or recommends to the full Board of Directors for selection, the director nominees. |
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Audit Fees |
Audit-Related Fees |
Tax Fees |
All Other Fees |
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Amount and Nature of | |||||||||
Beneficial Ownership(1) | |||||||||
Number of | Percent | ||||||||
Name and Address of Beneficial Owner | Shares | Owned(2) | |||||||
Redemco, L.L.C.(3) | 3,255,969 | 16.1 | % | ||||||
395 Mill Creek Circle | |||||||||
Vail, CO 81657 | |||||||||
Kern Capital Management, LLC | 2,720,900 | 13.4 | % | ||||||
114 West 47thStreet, Suite 1926 | |||||||||
New York, NY 10036 | |||||||||
T. Rowe Price Associates, Inc. | 1,698,794 | 8.4 | % | ||||||
100 E. Pratt Street | |||||||||
Baltimore, MD 21202 | |||||||||
Norman H. Pond(4) | 1,006,218 | 5.0 | % | ||||||
3560 Basset Street | |||||||||
Santa Clara, CA 95054 | |||||||||
Kevin Fairbairn(5) | 190,645 | * | |||||||
Charles B. Eddy(6) | 148,003 | * | |||||||
Verle Aebi(7) | 84,039 | * | |||||||
Luke Marusiak | 750 | * | |||||||
David S. Dury(8) | 45,000 | * | |||||||
Stanley J. Hill(9) | 34,000 | * | |||||||
David N. Lambeth(10) | 65,000 | * | |||||||
Robert Lemos(11) | 48,000 | * | |||||||
Arthur L. Money(12) | 40,000 | * | |||||||
All directors and executive officers as a group (10 persons)(13) | 1,661,655 | 8.0 | % |
* | Less than 1% |
(1) | Except as indicated in the footnotes to this table and pursuant to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares of Common Stock. The number of shares beneficially owned includes shares that such individual had the right to acquire either on or within 60 days after March 9, 2005, including upon the exercise of an option. | |
(2) | Percentage of beneficial ownership is based upon 20,266,172 shares of Common Stock that were outstanding on March 9, 2004. For each individual, this percentage includes shares that such individual had the right to acquire either on or within 60 days after March 9, 2005, including upon the exercise of an option; however, such shares are not considered outstanding for the purpose of computing the percentage owned by any other individual as required by Rule 13d-3(d)(1)(i) under the Securities Exchange Act of 1934. |
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(3) | These shares may be deemed to be beneficially owned by Mill Creek Systems, LLC and by Ann Becher Smead. Mill Creek Systems, LLC is a Managing Member of Redemco, L.L.C., and Ann Becher Smead is the Manager of Mill Creek Systems, LLC. | |
(4) | Includes 775,528 shares held by the Norman Hugh Pond and Natalie Pond Trust DTD 12/23/80 and 182,357 shares held by the Pond 1996 Charitable Remainder Unitrust, both of whose trustees are Norman Hugh Pond and Natalie Pond. Also includes options exercisable for 48,333 shares of Common Stock outstanding under the 1995 Stock Option/ Stock Issuance Plan (the “1995 Option Plan”). | |
(5) | Includes options exercisable for 174,999 shares of Common Stock under the 1995 Option Plan. | |
(6) | Includes 88,155 shares held by the Eddy Family Trust DTD 02/09/00, whose trustees are Charles Brown Eddy III and Melissa White Eddy, and options exercisable for 50,833 shares of Common Stock under the 1995 Option Plan. | |
(7) | Includes options exercisable for 38,166 shares of Common Stock under the 1995 Option Plan. | |
(8) | Includes options exercisable for 35,000 shares of Common Stock under the 1995 Option Plan and for 10,000 shares under the 2004 Equity Incentive Plan (the “2004 Plan”). | |
(9) | Includes options exercisable for 30,000 shares of Common Stock under the 1995 Option Plan. |
(10) | Includes options exercisable for 55,000 shares of Common Stock under the 1995 Option Plan and for 10,000 shares under the 2004 Plan. |
(11) | Includes options exercisable for 35,000 shares of Common Stock under the 1995 Option Plan and for 10,000 shares under the 2004 Plan. |
(12) | Includes options exercisable for 30,000 shares of Common Stock under the 1995 Option Plan and for 10,000 shares under the 2004 Plan. |
(13) | Includes options exercisable for 497,331 shares of Common Stock under the 1995 Option Plan and for 40,000 shares under the 2004 Plan. |
(1) Directors Dury, Lambeth, Lemos and Money each filed one late report on a Form 4 covering the grant of stock options. | |
(2) Mr. Fairbairn, Mr. Eddy, Mr. Aebi, Mr. Marusiak, Ms. Burk, Mr. Gustafson and Mr. Kerns each filed one late report on a Form 4 covering the grant of stock options. | |
(3) Mr. Lane filed two late reports on a Form 4, one covering the grant of a stock option and one covering the sale of 493 shares of our Common Stock. |
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Long-Term | |||||||||||||||||||||
Compensation | |||||||||||||||||||||
Annual Compensation | Awards | ||||||||||||||||||||
Securities | |||||||||||||||||||||
Underlying | All Other | ||||||||||||||||||||
Name and Principal Position(2) | Years | Salary ($)(1) | Bonus | Options (#) | Compensation | ||||||||||||||||
Norman H. Pond | 2004 | $ | 67,041 | — | — | $ | 2,917 | ||||||||||||||
Chairman of the Board | 2003 | 67,922 | — | — | 2,798 | ||||||||||||||||
2002 | 140,805 | — | — | 3,562 | |||||||||||||||||
Kevin Fairbairn | 2004 | 337,069 | — | 50,000 | 2,793 | ||||||||||||||||
President and Chief Executive Officer | 2003 | 270,304 | $ | 85,000 | — | 2,609 | |||||||||||||||
2002 | 216,734 | — | 250,000 | 2,312 | |||||||||||||||||
Charles B. Eddy III | 2004 | 192,619 | — | 20,000 | 2,396 | ||||||||||||||||
Vice President, Finance and | 2003 | 185,704 | — | — | 2,375 | ||||||||||||||||
Administration, Chief Financial | 2002 | 184,304 | — | — | 2,373 | ||||||||||||||||
Officer, Treasurer and Secretary | |||||||||||||||||||||
Verle Aebi | 2004 | 192,927 | — | 20,000 | 2,397 | ||||||||||||||||
President of Photonics Technology Division | 2003 | 187,708 | — | — | 2,248 | ||||||||||||||||
2002 | 186,294 | — | — | 2,247 | |||||||||||||||||
Luke Marusaik(3) | 2004 | 124,618 | — | 50,000 | 2,109 | ||||||||||||||||
Chief Operating Officer | 2003 | — | — | — | — | ||||||||||||||||
2002 | — | — | — | — |
(1) | Includes salary deferral contributions to Intevac’s 401(k) Plan. |
(2) | The indicated amount for each Named Executive Officer comprises the contributions made by Intevac on behalf of such individual to our 401(k) Plan, which match a portion of the officer’s salary deferral contributions to that plan, and the cost of any life insurance in excess of $50,000 paid by Intevac. |
(3) | Mr. Marusiak joined Intevac in April 2004 as Chief Operating Officer. |
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Individual Grants | Potential Realizable | |||||||||||||||||||||||
Value at Assumed Annual | ||||||||||||||||||||||||
Number of | Percent of | Rates of Stock Price | ||||||||||||||||||||||
Securities | Total Options | Appreciation | ||||||||||||||||||||||
Underlying | Granted to | Exercise or | for Option Term(1) | |||||||||||||||||||||
Options | Employees in | Base Price | Expiration | |||||||||||||||||||||
Name | Granted(2) | 2004 | ($/Share)(3) | Date | 5% | 10% | ||||||||||||||||||
Norman H. Pond | — | — | — | — | — | — | ||||||||||||||||||
Kevin Fairbairn | 50,000 | 8.2 | % | $ | 14.00 | 02/19/14 | $ | 440,226 | $ | 1,115,620 | ||||||||||||||
Charles B. Eddy III | 20,000 | 3.3 | % | 4.06 | 07/22/14 | 51,066 | 129,412 | |||||||||||||||||
Verle Aebi | 20,000 | 3.3 | % | 4.06 | 07/22/14 | 51,066 | 129,412 | |||||||||||||||||
Luke Marusiak | 50,000 | 8.2 | % | 10.01 | 05/14/14 | 314,762 | 797,668 |
(1) | There can be no assurance that the actual stock price appreciation over the 10-year option term will be at the 5% and 10% assumed annual rates of compounded stock price appreciation or at any other defined level. Unless the market price of the Common Stock appreciates over the option term, no value will be realized from the option grants made to the Named Executive Officers. |
(2) | Option shares granted to Mr. Fairbairn and Mr. Marusiak become fully exercisable with respect to (i) 25% of the shares upon the optionee’s completion of one year of service measured from the grant date and (ii) the balance of the shares in equal annual installments over the three-year period thereafter. Option shares granted to Mr. Eddy and Mr. Aebi become fully exercisable with respect to (i) 33.33% of the shares upon the optionee’s completion of two years of service measured from the grant date and (ii) the balance of the shares in equal annual installments over the two-year period thereafter. In addition, the option shares vest in full upon an acquisition of Intevac by merger or asset sale, unless such option is assumed by the acquiring entity. Each option has a maximum term of 10 years measured from the option grant date, subject to earlier termination following the optionee’s cessation of service with Intevac. Each option also includes a limited stock appreciation right which provides the optionee with a right, exercisable upon the successful completion of a hostile tender offer for fifty percent or more of Intevac’s outstanding voting securities, to surrender the option to Intevac, to the extent the option is at that time exercisable for vested shares, in return for a cash distribution per surrendered option share equal to the excess of (i) the highest price per share of Common Stock paid in the hostile tender offer over (ii) the option exercise price payable per share. |
(3) | The exercise price may be paid in cash or in shares of our Common Stock valued at fair market value on the exercise date. |
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Number of | ||||||||||||||||
Securities | ||||||||||||||||
Underlying | Value of Unexercised | |||||||||||||||
Unexercised | in-the-Money | |||||||||||||||
Options/SARs at | Options/SARs at | |||||||||||||||
Fiscal Year-End (#) | Fiscal Year-End | |||||||||||||||
Shares Acquired | Value | Exercisable/ | Exercisable/ | |||||||||||||
Name | on Exercise (#) | Realized(1) | Unexercisable | Unexercisable(2) | ||||||||||||
Norman H. Pond | 15,000 | $ | 51,000 | 48,333/0 | $ | 75,399/0 | ||||||||||
Kevin Fairbairn | — | — | 145,833/154,167 | $ | 718,957/513,543 | |||||||||||
Charles B. Eddy III | — | — | 50,833/22,000 | $ | 83,498/78,720 | |||||||||||
Verle Aebi | — | — | 45,666/22,000 | $ | 67,786/78,720 | |||||||||||
Luke Marusaik | — | — | 0/50,000 | $ | 0/0 |
(1) | Equal to the fair market value of the purchased shares on the option exercise date less the exercise price paid for those shares. |
(2) | Based on the market price of $7.56 per share, which was the closing price per share of our Common Stock on the Nasdaq National Market on the last day of fiscal 2004, less the exercise price payable for such shares. Options for which the exercise price is greater than $7.56 are excluded from this calculation. |
(a) | (b) | (c) | ||||||||||
Number of | ||||||||||||
Securities to Be | Number of Securities | |||||||||||
Issued Upon | Weighted-Average | Remaining Available | ||||||||||
Exercise of | Exercise Price of | for Future Issuance | ||||||||||
Outstanding | Outstanding | Under Equity | ||||||||||
Options, Warrants | Options, Warrants | Compensation | ||||||||||
Plan Category | and Rights | and Rights | Plans(1) | |||||||||
Equity compensation plans approved by security holders(2) | 1,712,955 | $ | 6.04 | 1,121,290 | ||||||||
Equity compensation plans not approved by security holders | — | $ | — | — | ||||||||
Total | 1,712,955 | $ | 6.04 | 1,121,290 |
(1) | Excludes securities reflected in column (a). |
(2) | Included in the column (c) amount are 276,013 shares available for future issuance under our 2003 Employee Stock Purchase Plan. |
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• | Market Driven: Our programs are structured to be competitive both in their design and in the total compensation opportunity they offer. Comparison groups will vary by business, based on the leading competitors in the industries in which we compete for business and in the markets in which we compete for talent. | |
• | Shareholder-Aligned: To focus on the common linkage to Intevac, employees have some portion of their compensation dependent upon company-wide financial performance. | |
• | Performance-Based: Employees have their pay linked to a combination of company, team and individual performance. The specific measures of success that apply and the forms of compensation that are affected vary by business and by position. Individual performance is objectively assessed via a formal performance management process. | |
• | Values-Oriented: The design and administration of our compensation programs are supportive of our values and commitment to diversity. Our assessments of individual performance are measured against our values. |
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This report is submitted by the Compensation Committee. | |
David N. Lambeth | |
Robert Lemos (Chairman) |
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1. The Audit Committee has reviewed and discussed with management and the independent accountants our audited consolidated financial statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2004. | |
2. The Audit Committee has discussed with the independent accountants matters required to be discussed by Statement on Auditing Standards No. 61 (Communications with Audit Committees). | |
3. The Audit Committee has received from the independent accountants, Grant Thornton LLP, the written disclosures and the letter required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees), and the Audit Committee has discussed with Grant Thornton LLP the independent accountants’ independence. | |
4. The Audit Committee has considered whether the provision of services covered by Fees Paid To Accountants For Services Rendered is compatible with maintaining the independence of Grant Thornton LLP. |
This report is submitted by the Audit Committee. | |
David S. Dury (Chairman) | |
Robert Lemos | |
Arthur L. Money |
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![(PERFORMANCE GRAPH)](https://capedge.com/proxy/DEF 14A/0000950134-05-007330/f06691def0669103.gif)
12/31/99 | 12/31/00 | 12/31/01 | 12/31/02 | 12/31/03 | 12/31/04 | ||||||||||||||||||||||||||
Intevac, Inc. | $ | 100 | $ | 89 | $ | 68 | $ | 114 | $ | 403 | $ | 216 | |||||||||||||||||||
Nasdaq Stock Market Total Return Index | 100 | 60 | 48 | 33 | 49 | 54 | |||||||||||||||||||||||||
Nasdaq Computer Manufacturers Total Return Index | 100 | 57 | 39 | 26 | 36 | 47 | |||||||||||||||||||||||||
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BY ORDER OF THE BOARD OF DIRECTORS | |
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CHARLES B. EDDY III | |
Vice President, Finance and Administration, | |
Chief Financial Officer, Treasurer and Secretary |
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THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
INTEVAC, INC.
Kevin Fairbairn and Charles B. Eddy III, or either of them, are hereby appointed as the lawful agents and proxies of the undersigned (with all powers the undersigned would possess if personally present, including full power of substitution) to represent and to vote all shares of capital stock of Intevac, Inc. which the undersigned is entitled to vote at our Annual Meeting of Shareholders on May 19, 2005, and at any adjournments or postponements thereof, as follows on the reverse side.
CONTINUED AND TO BE SIGNED ON REVERSE SIDE | ||||
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The Board of Directors recommends a vote FOR each of the proposals below. This Proxy will be voted as directed, or, if no direction is indicated, will be voted FOR each of the proposals below and at the discretion of the persons named as proxies upon such other matters as may properly come before the meeting. This proxy may be revoked at any time before it is voted.
1. | The election of all nominees listed below for the Board of Directors, as described in the Proxy Statement: |
Nominees:Norman H. Pond, Kevin Fairbairn, David S. Dury, Stanley J. Hill, David N. Lambeth, Robert Lemos and Arthur L. Money
FOR o | WITHHELD o |
(INSTRUCTION: To withhold authority to vote for any individual nominee, write such name or names in the space provided below.)
2. | Proposal to approve an amendment to the Company’s Bylaws to increase the range of authorized directors to a range of five to nine.: |
FOR o | AGAINST o | ABSTAIN o |
3. | Proposal to ratify the appointment of Grant Thornton LLP as independent public accountants of Intevac for the fiscal year ending December 31, 2005: |
FOR o | AGAINST o | ABSTAIN o |
4. | Transaction of any other business which may properly come before the meeting and any adjournment or postponement thereof. |
DATE: _______________________, 2005
(Signature) | ||
(Signature if held jointly) |
(Please sign exactly as shown on your stock certificate and on the envelope in which this proxy was mailed. When signing as partner, corporate officer, attorney, executor, administrator, trustee, guardian or in any other representative capacity, give full title as such and sign your own name as well. If stock is held jointly, each joint owner should sign.)
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY,
USING THE ENCLOSED ENVELOPE.