SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
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Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
ANADIGICS, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
________________________________________________________________________________
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Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and O-11.
1) Title of each class of securities to which transaction applies:
_______________________________________________________________________
2) Aggregate number of securities to which transaction applies:
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3) Per unit price of other underlying value of transaction computed
pursuant to Exchange Act Rule O-11 Set forth the amount on which the
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[ ] Fee paid previously with preliminary materials.
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4) Date Filed:
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[Logo] ANADIGICS(R)
============
Your GaAs IC Source
35 Technology Drive
Warren, NJ 07059
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 29, 1997
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of ANADIGICS, Inc., a Delaware
corporation ("ANADIGICS"), will be held on Thursday, May 29, 1997 at 10:00
o'clock a.m. (E.S.T.), at the Somerset Hills Hotel, 200 Liberty Corner Road
(Route 525), Warren, New Jersey 07052, for the purpose of considering and acting
upon the following:
1) The election of three Class II Directors of ANADIGICS to hold office
until 2000.
2) To approve an amendment to the Amended and Restated Certificate of
Incorporation to increase the number of authorized shares of Common
Stock by 34,000,000 to 68,000,000.
3) To approve an amendment to the Amended and Restated Certificate of
Incorporation to permit the Board of Directors to amend the bylaws of
the Company.
4) To approve an amendment to the 1995 Long Term Incentive and Share
Award Plan to increase the number of shares issuable thereunder by
1,500,000 shares.
5) The ratification of Ernst & Young LLP as independent auditors of
ANADIGICS, Inc. for the fiscal year ending December 31, 1997.
6) The transaction of such other business as may properly be brought
before the meeting or any adjournment thereof.
Only stockholders of record at the close of business on April 10, 1997 are
entitled to notice of and to vote at the Annual Meeting of Stockholders and any
adjournment or postponement thereof. Admission to the Annual Meeting will be by
ticket only. If you are a registered stockholder planning to attend the meeting,
please check the appropriate box on the proxy card and retain the bottom portion
of the card as your admission ticket. If your shares are held through an
intermediary such as a bank or broker, follow the instructions in the Proxy
Statement to obtain a ticket. For at least ten (10) days prior to the Annual
Meeting, a list of stockholders entitled to vote at the Meeting will be open for
the examination of any stockholder, for any purpose germane to the Meeting,
during ordinary business hours at the office of ANADIGICS, Inc.
Stockholders are cordially invited to attend the Annual Meeting. However,
whether or not a stockholder plans to attend, each stockholder is urged to sign,
date, and return promptly the enclosed proxy in the accompanying envelope.
The Annual Report, Proxy Statement and Proxy are enclosed with this notice
and were mailed at New York, NY on or about April 29, 1997.
By order of the Board of Directors
GEORGE J. GILBERT
Secretary
- --------------------------------------------------------------------------------
IMPORTANT
Please sign, date, and return the enclosed Proxy immediately whether or not you
plan to attend the meeting. A return envelope, which requires no postage if
mailed in the United States, is enclosed for that purpose.
- --------------------------------------------------------------------------------
[Logo] ANADIGICS(R)
============
Your GaAs IC Source
35 Technology Drive
Warren, NJ 07059
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
Solicitation of Proxies
This Proxy Statement, which is being mailed to stockholders on or about April
29, 1997, is furnished in connection with the solicitation by the Board of
Directors of ANADIGICS, Inc., a Delaware corporation ("ANADIGICS" or the
"Company"), of proxies for use at its Annual Meeting of Stockholders to be held
on Thursday, May 29, 1997, at 10:00 o'clock a.m. (E.S.T.), at the Somerset Hills
Hotel, 200 Liberty Corner Road (Route 525), Warren, New Jersey 07052, and at any
adjournment of the Annual Meeting.
Attendance at the Annual Meeting will be limited to stockholders as of the
record date, their authorized representatives and guest of the Company.
Admission will be by ticket only. For registered stockholders, the bottom
portion of the proxy card enclosed with the Proxy Statement is their Annual
Meeting ticket. Beneficial owners with shares held through an intermediary, such
as a bank or broker, should request tickets in writing from Investor Relations,
ANADIGICS, Inc., 35 Technology Drive, Warren, New Jersey 07059, and include
proof of ownership, such as a bank or brokerage firm account statement or a
letter from the broker, trustee, bank or nominee holding their stock, confirming
beneficial ownership. Stockholders who do not obtain tickets in advance may
obtain them upon verification of ownership at the Registration Desk on the day
of the meeting. Admission to the Annual Meeting will be facilitated if tickets
are obtained in advanced. Tickets may be issued to others at the discretion of
the Company.
At the meeting, stockholders will be asked to elect three Class II Directors,
to approve amendments to the Amended and Restated Certificate of Incorporation,
to approve amendments to the 1995 Long Term Incentive and Share Award Plan and
to ratify the appointment of auditors. Because many of our stockholders are
unable personally to attend the Annual Meeting, the Board of Directors solicits
the enclosed proxy so that each stockholder is given an opportunity to vote.
This proxy enables each stockholder to vote on all matters which are scheduled
to come before the meeting. When the proxy card is returned properly executed,
the stockholder's shares will be voted according to the stockholder's
directions. Stockholders are urged to specify their choices by marking the
appropriate boxes on the enclosed proxy card. If no choice has been specified,
the shares will be voted FOR the election of the Director-nominees listed below,
FOR the adoption of an amendment to the Company's Amended and Restated
Certificate of Incorporation to permit the Board of Directors to amend the
Company's bylaws, FOR the adoption of an amendment to increase the number of
authorized shares of the Company's common stock, par value $.01 per share ( the
"Common Stock") by 34,000,000, FOR the adoption of an amendment to the 1995 Long
Term Incentive and Share Award Plan (the "1995 Plan") to increase the number of
shares issuable thereunder by 1,500,000 shares and FOR the ratification of the
appointment of Ernst & Young LLP as independent auditors. Proxies will also be
solicited on behalf of management by a ChaseMellon Shareholder Services for a
fee of approximately $5,000 which will be borne by the Company.
The Board of Directors knows of no other business which will be presented at
the meeting. If, however, other matters are properly presented, the persons
named in the enclosed proxy will vote the shares represented thereby in
accordance with their judgment on such matters.
A proxy may be revoked by giving the Secretary of ANADIGICS, Inc. written
notice of revocation at any time before the voting of the shares represented by
the proxy. A stockholder who attends the meeting may cancel any proxy at the
meeting.
Quorum and Voting Rights
The presence, in person or by proxy, of the holders of a majority of the
issued and outstanding shares of Common Stock of the Company entitled to vote
(exclusive of shares held by or for the account of the Company) is necessary to
constitute a quorum at the Annual Meeting of Stockholders. Abstentions and
broker non-votes shall be counted for purposes of determining whether a quorum
is present. With respect to the two proposals amending the Amended and Restated
Certificate of Incorporation of ANADIGICS, Inc., the affirmative vote of a
majority of the shares of Common Stock outstanding and entitled to vote thereon
is required for approval thereof. The affirmative vote of a plurality of the
shares of Common Stock present in person or by proxy at the meeting is required
for the election of directors. The affirmative vote of the holders of a majority
of the shares of Common Stock present in person or by proxy at the meeting is
required for the approval thereof with respect to each of the other matters to
be presented at the meeting. Only holders of record of Common Stock at the close
of business on April 10, 1997 are entitled to notice of and to vote at the
Annual Meeting of Stockholders and any adjournment or postponement thereof.
As of April 10, 1997, the Company had issued and outstanding 14,481,943
shares of Common Stock. Each share of Common Stock entitles the holder to one
vote upon each matter to be voted upon.
PRINCIPAL STOCKHOLDERS
The following tables lists all persons known to be the beneficial owner of
more than 5% of ANADIGICS, Inc. outstanding Common Stock as of March 15, 1997.
% Beneficial
Name and Address Number of Shares Ownership
- ---------------- ---------------- ---------
Smith Barney Holdings Inc. 953,574 (1) 6.6
388 Greenwich Street, New York, NY 10013
- ----------
(1) As reported by Travelers Group Inc. and related entities on Schedule 13G
filed with the Securities and Exchange Commission dated February 5, 1997.
INFORMATION REGARDING DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS
BOARD OF DIRECTORS
The Company's bylaws provide that the Board of Directors shall be divided
into three classes designated Class I, Class II and Class III, each class
consisting as nearly as possible of one-third of the total number of Directors
constituting the entire Board of Directors; provided, however, that in no case
will a decrease in the number of Directors shorten the term of any incumbent
Director. The Board of Directors is presently comprised of nine members.
The term of office for each Director in Class II expires at the Annual
Meeting in 1997; the term of office for each Director in Class III expires at
the Annual Meeting in 1998; and the term of office for each Director in Class I
expires at the Annual Meeting in 1999. At each annual meeting of stockholders,
directors will be elected for full terms of three years to succeed those
directors whose terms are expiring. On April 2, 1997, Mr. Bachow concurrently
resigned as a Class III Director and was appointed and elected by the Board of
Directors as a Class II Director in order to equalize the number of members in
each of the Board classes in accordance with the bylaws of the Company.
2
PROPOSAL I: ELECTION OF DIRECTORS
At the 1997 Annual Meeting, three Directors are to be elected to hold office
until the 2000 Annual Meeting of Stockholders. All of the nominees are currently
serving as Directors.
The Board of Directors has no reason to believe that any nominee will be
unable to serve if elected. If any nominee becomes unavailable for election,
then those shares votes for such nominee will be voted for the election of a
substitute nominee selected by the persons named in the enclosed proxy.
The nominees for Director will be elected if they receive the affirmative
vote of a plurality of the votes of the shares of Common Stock present in person
or by proxy and entitled to vote at the Annual Meeting. Any shares not voted
(whether by abstention, broker non-vote or votes withheld) are not counted as
votes cast for such individuals and will be excluded from the vote.
The Board of Directors recommends a vote "FOR" each of the nominees listed
below:
NOMINEES FOR TERMS EXPIRING IN 2000
(Class II Directors)
PAUL BACHOW (Age 45)
Mr. Bachow has served as a director of the Company since January 1993. He has
been President of Bachow & Associates, Inc. since its formation in December
1989, and its predecessors, Bachow and Elkin Co., Inc. and Paul S. Bachow
Company from December 1985 to December 1989. Mr. Bachow also acts as President
of the general partner of each of Paul S. Bachow Co-Investment Fund, L.P.,
Bachow Investment Partners III, L.P. and Bachtel Cellular Liquidity, L.P. He has
a B.A. from American University, a J.D. from Rutgers University and a Masters
Degree in tax law from New York University, and is a C.P.A. Mr. Bachow serves as
director of Deb Shops, Inc., a publicly traded company, and several private
companies.
GEORGE GILBERT (Age 61)
Mr. Gilbert, a co-founder of ANADIGICS in 1985, has served as Executive Vice
President, Chief Operating Officer and a director of the Company since its
inception. He was co-founder of Microwave Semiconductor Corporation ("MSC"), a
manufacturer of microwave silicon and GaAs transistors and amplifiers, with Mr.
Rosenzweig and served as Executive Vice President of Semiconductor Operations of
MSC from 1968 to 1983. Mr. Gilbert has a B.S. in Physics from Georgia Tech.
CHARLES HUANG (Age 49)
Dr. Huang, a co-founder of ANADIGICS in 1985, has served as Executive Vice
President and a director of the Company since its inception. He was director of
GaAs research and development and wafer fabrication services at Avantek from
1980 to 1984. Dr. Huang received his Ph.D.E.E. at the University of California,
Berkeley.
The following Directors of the Company will continue to serve in accordance
with their existing terms.
3
DIRECTORS CONTINUING IN OFFICE UNTIL 1998
(Class III Directors)
DAVID FELLOWS (Age 44)
Mr. Fellows has served as a director of the Company since September 1994. Mr.
Fellows has served as Senior Vice President of Engineering and Technology at
Continental Cablevision, Inc., a division of US West Media Group, since 1992.
From 1987 until 1992, Mr. Fellows was employed by Scientific Atlanta's
Transmission Systems Business Division, where he served as President. Mr.
Fellows received his Bachelor Degree in Engineering and Applied Physics from
Harvard College and a Masters Degree in Electrical Engineering from Northeastern
University.
RONALD ROSENZWEIG (Age 59)
Mr. Rosenzweig, a co-founder of ANADIGICS in 1985, has served as President,
Chief Executive Officer and a director of the Company since its inception. He
was co-founder of MSC. He served as President and CEO of MSC from 1968 to 1983.
Mr. Rosenzweig received his B.Ch.E degree from City College of New York.
LEWIS SOLOMON (Age 63)
Mr. Solomon has served as a director of the Company since September 1994 and,
previously, from 1985 to 1989. Mr. Solomon has been Chairman of G&L Investments
since 1990 in addition to serving as a director on the boards of
Microelectronics Packaging Inc., ICTV Inc., Anacomp Inc., Computer Products Inc.
And Terayon Corporation. Prior to joining G&L Investments, Mr. Solomon was an
Executive Vice President with Alan Patricof Associates from 1983 to 1986, and a
Senior Vice President of General Instrument from 1967 to 1983. Mr. Solomon
received a Bachelor Degree in Physics from St. Joseph's College and a Masters
Degree in Industrial Engineering from Temple University.
DIRECTORS CONTINUING IN OFFICE UNTIL 1999
(Class I Directors)
CHARLES BURTON (Age 51)
Mr. Burton has served as a director of the Company since 1990. He is Managing
Director of Philadelphia Ventures Inc., which he joined in 1984. Prior to 1984
he was a Vice President of CIGNA Corporation. Mr. Burton graduated from
Gettysburg College and received an MBA from the Wharton Graduate School at the
University of Pennsylvania. He is also a director of Membrex, Inc., Microsource,
Inc., Visual Edge Technology, Inc. and several private companies.
BRUNS GRAYSON (Age 49)
Mr. Grayson has served as a director of the Company since 1985. He is
managing General Partner of Calvert Capital Management Co., which manages ABS
Ventures. Before joining Calvert Capital Management Co., Mr. Grayson was an
associate of Adler & Co. and McKinsey & Co. in New York. He is a director of
Cascade Communications and several private companies. He has a B.A. from
Harvard, an M.A. from Oxford University and a J.D. from the University of
Virginia.
HARRY REIN (Age 52)
Mr. Rein has served as a director of the Company since 1985. He was a
principal founder of Canaan Venture Partners in 1987 and has served as Managing
General Partner since its inception. From 1979 to 1987, Mr. Rein held various
positions at GE, directing several of GE's lighting businesses as general
manager before becoming President and CEO of GE Venture Capital Corporation. He
is a director of Perceptron, Inc. and several private companies.
4
EXECUTIVE OFFICERS OF THE REGISTRANT
The current executive officers of the Company are as follows:
Name Age Position
- ---- --- --------
Ronald Rosenzweig 59 President, Chief Executive Officer and Director
George Gilbert 61 Executive Vice President, Chief Operating Officer and
Director
Charles Huang 49 Executive Vice President Marketing Research and Business
Development and Director
John F. Lyons 50 Senior Vice President and Chief Financial Officer
Robert Bayruns 39 Vice President Research and Technology
James Gilbert 33 Vice President, Process & Device Engineering
Sheo Khetan 47 Vice President Manufacturing
Javed S. Patel 41 Vice President Sales and Marketing
Phillip Wallace 40 Vice President Product Development
Set forth below is certain information with respect to the Company's
executive officers. Officers are appointed to serve at the discretion of the
Board of Directors. There are no family relationships between executive officers
or directors of the Company except for Messrs. George Gilbert and James Gilbert,
who are father and son respectively. Information on Mr. Rosenzweig, Mr. Gilbert
and Dr. Huang is listed in the Director profile above.
Mr. Lyons joined ANADIGICS in 1987 as Director of Finance, was elected a Vice
President in 1989, and currently serves as Senior Vice President and Chief
Financial Officer. Prior to joining the Company, he served as Manager- Finance
Section for GE's Power Electronic Semiconductor Department from 1984 to 1987.
Mr. Lyons is a graduate of GE's Financial Management Program and has a B.A. in
Economics from Hamline University.
Mr. Bayruns joined ANADIGICS in 1985 and currently serves as Vice President
Research and Technology. Prior to joining ANADIGICS, Mr. Bayruns was employed by
AT&T Bell Laboratories. Mr. Bayruns received his M.S.E.E. from Rutgers
University.
Mr. James Gilbert joined ANADIGICS in 1997 as Vice President, Process &
Device Engineering. Prior to joining ANADIGICS, Mr. Gilbert was employed by
Motorola Inc, Compound Semiconductor Technologies in Tempe, AZ. Mr. Gilbert
received his B.S.E.E. from Cornell University.
Mr. Khetan joined ANADIGICS in 1985 and currently serves as Vice President of
Manufacturing. Prior to joining ANADIGICS, Mr. Khetan was at Sprague Solid State
Scientific and, prior to that, at General Instrument. Mr. Khetan received his
Bachelor of Science Degree in Engineering from the Indian Institute of
Technology, a Masters of Science from State University of New York, and a
Masters Degree in Business Administration from Temple University.
Mr. Patel joined ANADIGICS in 1986 and currently serves as Vice President of
Sales and Marketing. Prior to joining ANADIGICS, Mr. Patel was employed by Alpha
Industries. From 1979 to 1984, Mr. Patel was a member of the Technical Staff of
RCA-Astroelectronics. Mr. Patel received his Bachelor of Science Degree and
Masters of Science Degree in Engineering from the University of Kansas and a
Masters Degree in Business Administration from Drexel University.
Mr. Wallace joined ANADIGICS in 1985 and currently serves as Vice President
Product Development. Prior to joining ANADIGICS, Mr. Wallace was at the
Westinghouse R&D Center in Pittsburgh, PA, and, prior to that, he was with MSC.
Mr. Wallace received his B.S.E.E. and M.Eng. (Electrical) from Cornell
University.
Certain Relationships and Related Transactions
Mr. James Gilbert, Vice President, Process & Device Engineering, is the son
of Mr. George Gilbert, Executive Vice President, Chief Operating Officer and a
Director.
5
Section 16(a) Beneficial Ownership Reporting Compliance
Based on the Company's review of copies of all disclosure reports filed by
Directors and executive officers of the Company pursuant to Section 16(a) of the
Securities Exchange Act of 1934, as amended, the Company believes that there was
compliance with all filing requirements of Section 16(a) applicable to Directors
and executive officers of the Company during the fiscal year, except for a Form
4 filed by Mr. Lyons with respect to a donation of 280 Shares of Common Stock
which was filed late.
Stock Ownership of Directors and Management
The following table sets forth as of March 15, 1997 certain information about
stock ownership of each Director and nominee for directorship, the Chief
Executive Officer and the next four most highly compensated executive officers,
and all Directors and executive officers as a group.
Common Stock % Beneficial
Name Beneficially Owned Ownership
---- ------------------ ---------
Paul Bachow......................... 179,515 (1) 1.2
Charles Burton...................... 186,726 (1) 1.3
David Fellows....................... 28,500 (1) (7)
Bruns Grayson....................... 54,135 (1) (7)
Harry Rein.......................... 601,362 (1) 4.2
Lewis Solomon....................... 28,500 (1) (7)
Ronald Rosenzweig................... 201,764 (2) 1.4
George Gilbert...................... 129,283 (3) (7)
Charles Huang....................... 272,913 (4) 1.9
John F. Lyons....................... 99,323 (5) (7)
Javed S. Patel...................... 54,384 (6) (7)
All Directors and Executive Officers
as a group, including 4 officers
not named above................... 1,979,689 13.7
- ----------
(1) Includes 28,500 shares of common stock issuable pursuant to options,
exercisable within 60 days.
(2) Includes 66,866 shares of common stock issuable pursuant to options
exercisable within 60 days.
(3) Includes 63,741 shares of common stock issuable pursuant to options
exercisable within 60 days.
(4) Includes 63,741 shares of common stock issuable pursuant to options
exercisable within 60 days.
(5) Includes 34,066 shares of common stock issuable pursuant to options
exercisable within 60 days.
(6) Includes 22,326 shares of common stock issuable pursuant to options
exercisable within 60 days.
(7) Less than 1%.
6
Committees of the Board
The standing committees of the ANADIGICS, Inc. Board of Directors are as
follows:
The Audit Committee is responsible for (i) determining the adequacy of the
Company's internal accounting and financial controls, (ii) reviewing the results
of the audit of the Company performed by the independent public accountants, and
(iii) recommending the selection of independent public accountants. Messrs.
Bachow, Burton and Solomon were members of the Audit Committee during fiscal
1996. The Audit Committee met twice during the 1996 fiscal year.
The Compensation Committee determines matters pertaining to the compensation
of certain executive officers of the Company and administers the Company's stock
option, incentive compensation, and employee stock purchase plans. Messrs.
Grayson and Rein were members of the Compensation Committee during fiscal 1996.
The Compensation Committee met once during the 1996 fiscal year.
The Executive Committee has authority to act for the Board on most matters
during intervals between Board meetings. The Executive Committee consists of
Messrs. Bachow, Burton, Fellows, Rein, and Rosenzweig. The Executive Committee
met three times during the 1996 fiscal year.
During fiscal 1996, the Board of Directors met six times. Each of the
Directors attended at least 75% of the aggregate of all meetings the Board held.
7
COMPENSATION AND OTHER TRANSACTIONS WITH DIRECTORS, NOMINEES, AND
EXECUTIVE OFFICERS
Summary Compensation Table
Shown below is information concerning the annual compensation for services in
all capacities to the Company for the last three fiscal years of those persons
who were at December 31, 1996 (i) the chief executive officer of the Company and
(ii) the other four most highly compensated officers of the Company
(collectively, the "named executive officers"):
Summary Compensation Table
Long-Term
Compensation
Annual Compensation Awards
------------------- ------
Securities
Name and Other Annual Underlying
Principal Position Year Salary Bonus(1) Compensation(2) Options
- ------------------ ---- ------ -------- -------------- --------
Ronald Rosenzweig.......... 1996 $201,500 $106,352 $6776 37,500
Chief Executive Officer 1995 185,846 157,624 3,978 24,000
1994 177,500 69,020 7,732 27,241
George Gilbert............. 1996 189,586 92,841 3024 30,000
Executive Vice President 1995 174,942 137,387 3,926 24,000
1994 167,500 60,291 3,915 27,241
Charles Huang.............. 1996 174,673 85,550 3,783 30,000
Executive Vice President 1995 161,038 126,435 9,085 24,000
1994 152,000 55,541 3,965 27,241
John F. Lyons.............. 1996 147,875 66,698 1,687 22,500
Senior Vice President 1995 136,134 98,533 3,640 11,550
1994 128,000 43,059 1,627 13,141
Javed S. Patel............. 1996 130,019 58,641 1,081 9,000
Vice President 1995 120,423 86,681 1,254 8,700
1994 115,000 47,557 1,109 9,867
- ----------
(1) Represents bonuses earned in 1996, 1995 or 1994 and payable during 1997,
1996 or 1995, respectively. The bonuses are payable as follows: 40% of each
bonus is payable during the first quarter of the respective year in which
the bonus is paid, and 20% of each such bonus is payable during the second,
third, and fourth quarters of the respective year in which the bonus is
paid. If a named executive officer is not employed with the Company at the
time of such bonus payment, the bonus payment is forfeited.
(2) Represents the value of income tax preparation services provided to each of
Messrs. Rosenzweig and Gilbert by the Company's auditors and premiums paid
for medical insurance covering each of the named executive officers.
8
Stock Options and Certain Other Compensation
The following table presents the stock options granted to the named executive
officers in fiscal 1996 under the Company's 1995 Long Term Incentive and Share
Award Plan:
Option Grants in Last Fiscal Year
Potential Realizable
Percent of Value at Assumed
Total Annual Rates of
Number of Options Stock Price
Securities Granted to Appreciation for
Underlying Employees Exercise Option Term
Options in Fiscal Price $ per Expiration --------------------
Name Granted (1) Year Share (2) Date 5% 10%
- ---- ----------- ---- --------- ---- -- ---
Ronald Rosenzweig.............. 37,500 8.5% $14.33 1/31/06 $338,030 $856,635
George Gilbert................. 30,000 6.8 14.33 1/31/06 270,424 685,308
Charles Huang.................. 30,000 6.8 14.33 1/31/06 270,424 685,308
John F. Lyons.................. 22,500 5.1 14.33 1/31/06 202,818 513,981
Javed S. Patel................. 9,000 2.0 14.33 1/31/06 81,127 205,592
- ----------
(1) One-third of the options become exercisable one year from the date of grant.
Thereafter, two-thirds of the options become exercisable ratably on a quarterly
basis over the following two years.
(2) The exercise price of the stock options was based on the fair market value
of the stock on the date of grant.
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
Stock Price at 12/31/96 $26.17
# of Securities Value of
Underlying Unexercised
Unexercised In-the-money
Shares Acquired Value Options at FY-End Options at FY-End
on Exercise Realized $ Exercisable Unexercisable Exercisable Unexercisable
----------- ---------- ----------- ------------- ----------- -------------
Ronald Rosenzweig. 40,971 47,770 $929,910 $647,197
George Gilbert.... 40,971 40,270 929,910 558,446
Charles Huang..... 40,971 40,270 929,910 558,446
John F. Lyons..... 19,843 27,445 450,777 364,225
Javed S. Patel.... 7 $172 14,854 12,722 337,148 180,227
9
Compensation of Directors
Non-management Directors receive options under the 1995 Long Term Incentive
and Share Award Plan (the "1995 Plan"). Under the 1995 Plan, a grant of options
to purchase 15,000 shares of Common Stock will automatically be granted on the
date a Director is first elected to the Board with an exercise price per share
equal to 100% of the market value of one share on the date of grant. Each option
so granted will expire ten years after the date of grant and will become
exercisable in three equal installments commencing on the date of grant and
annually thereafter. Commencing January 1, 1996, Directors receive an annual
grant of options to purchase 4,000 shares of Common Stock at the fair market
value as determined on the date of grant, which options will vest on December 31
in the year granted. In addition, each non-management Director receives $5,000
per year plus $500 for each meeting of the Board of Directors, or any of its
Committees attended, and each Director is reimbursed for ordinary expenses
incurred in connection with attendance at such meetings.
Compensation Committee Report
The Compensation Committee establishes and reviews the compensation of the
Company's executive officers. The Compensation Committee of the Board of
Directors consists entirely of non-employee directors.
Compensation Philosophy. The Company's executive compensation program is
designed to attract and retain key executives who will enhance the performance
of the Company, promote its long-term interest and build stockholders' equity.
The Committee sought to align total compensation for executive management with
corporate performance. The Company's executive compensation package generally
includes four main components:
1) A base salary which is established at levels considered appropriate for
the duties and scope of responsibilities of each officer's position.
2) A bonus potential which is tied directly to operating income objectives.
3) A stock option award to increase stock ownership in the Company and align
executive compensation with stockholder interests.
4) Other compensation and employee benefits generally available to all
employees of the Company, such as health insurance and participation in
the Anadigics, Inc. Employee Savings and Protection Plan ( "401(k)"
plan).
The Compensation Committee places a particular emphasis on variable,
performance based components, such as the bonus potential and stock option
awards, the value of which could increase or decrease to reflect changes in
corporate and individual performances.
In general, compensation payments in excess of $1.0 million to any of the
named Executive Officers are subject to a limitation on deductibility by the
Company under Section 162(m) of the Internal Revenue Code of 1986, as amended.
The deduction limit does not apply to performance based compensation that
satisfies certain requirements. The Committee has not yet determined a policy
with regard to Section 162(m); however, no officer of the Company is expected to
earn compensation in excess of $1.0 million in 1997.
Chief Executive Officer Compensation. Mr. Rosenzweig's 1996 compensation
consisted of base salary, bonus, stock options, and executive benefits. Mr.
Rosenzweig's base salary was set in 1996 at $201,500 which the Committee
determined to be reasonable in view of Mr. Rosenzweig's responsibility,
seniority, and past performance to the Company. Mr. Rosenzweig's 1996 bonus
payout of $157,624 was from the 1995 bonus award. The 1996 bonus award of
$106,352 will be paid to Mr. Rosenzweig in 1997 over a quarterly timetable. The
Committee authorized a grant in fiscal 1996 to Mr. Rosenzweig of options to
purchase 37,500 shares of Common Stock. The Committee believes the grant of
stock based compensation encourages long-term performance and aligns management
and stockholders interest in the performance of the Company's Common Stock.
Compensation Committee:
Bruns Grayson
Harry Rein
10
Performance Graph
The following graph compares the cumulative total shareholder return on the
Company's Common Stock from the initial public offering date through December
31, 1996 with the cumulative total return on the Nasdaq Stock Market Index and
the Nasdaq Electronic Components Stocks Index (SIC Code 367). The Company is
included in both indexes. The comparison assumes $100 was invested on April 20,
1995 in the Company's Common Stock and in each of the foregoing indices and
assumes reinvestment of dividends. The Company did not declare, nor did it pay
any dividends during the comparison period. Notwithstanding any statement to the
contrary in any of the Company's previous or future filings with the Securities
and Exchange Commission, the graph shall not be incorporated by reference into
any such filings.
[The following table was represented as a line graph in the printed material.]
Nasdaq Stock Nasdaq Electronics
ANADIGICS, Inc. Market Index Components Index
--------------- ------------ ------------------
Dollars ($)
4/20/95 100 100 100
12/30/95 177 130 124
12/30/96 327 159 215
11
PROPOSAL II: ADOPTION OF AMENDMENT TO CERTIFICATION OF INCORPORATION TO
INCREASE THE NUMBER OF AUTHORIZED COMMON SHARES
Pursuant to Article IV of the Company's Amended and Restated Certificate of
Incorporation, the Company is authorized to issue 40,000,000 shares of all
classes of capital stock, consisting of (i) 34,000,000 shares of Common Stock,
(ii) 1,000,000 shares of non-voting common stock, par value $.01 per share
("Non-Voting Common Stock"), and (iii) 5,000,000 shares of preferred stock, par
value $.01 per share ("Preferred Stock"). On March 15, 1997 the Company had
issued and outstanding 14,481,943 shares of Common Stock. In addition the
Company had 2,960,495 shares of Common Stock reserved for issuance under the
Company's stock purchase and stock option plans and outstanding warrants. There
were no outstanding shares of Non-Voting Common Stock or Preferred Stock as of
March 15, 1997.
On April 2, 1997, the Board of Directors unanimously proposed and declared
advisable amendments to Article IV of the Amended and Restated Certificate of
Incorporation of the Company which would increase the number of authorized
shares of Common Stock by 34,000,000 shares to 68,000,000 shares and the number
of authorized shares of all classes of capital stock from 40,000,000 to
74,000,000 shares. If this proposal is adopted, the first paragraph of Article
IV of the Amended and Restated Certificate of Incorporation would read as
follows:
"The Corporation shall be authorized to issue 74,000,000 shares of all
classes of capital stock, consisting of (I) 68,000,000 shares of common
stock, par value $.01 per share ("Common Stock"), (ii) 1,000,000 shares of
non-voting common stock, par value $.01 per share ("NonVoting Common
Stock"; together with the Common Stock, "Common Shares"), and (iii)
5,000,000 shares of preferred stock, par value $.01 per share ("Preferred
Stock")."
Description of the Proposed Amendment to Increase the Number of Authorized
Shares of Common Stock.
The Board of Directors of the Company considers it prudent and in the best
interests of the Company and its stockholders to have a substantial number of
shares of Common Stock authorized by the Amended and Restated Certificate of
Incorporation which are available for issuance, in order to provide the Company
with financing and business flexibility. Common Stock may be issued by the
Company in connection with future acquisitions or equity financings, stock
splits or stock dividends, conversion or exchange of outstanding securities, in
connection with management incentive or employee benefit plans, or under other
circumstances. There are currently no agreements or understandings regarding the
issuance of any additional shares of Common Stock that would become available if
the Company's Amended and Restated Certificate of Incorporation is amended.
The additional shares of Common Stock for which authorization is sought would
be part of the existing class of Common Stock, and, to the extent issued, would
have the same rights and privileges as the shares of Common Stock currently
outstanding. No holder of Common Stock is entitled to any preemptive right to
subscribe for or purchase any stock or other security of the Company.
The increase in the number of authorized shares of Common Stock and the
issuance of a substantial amount of such shares or the granting of an option to
purchase a substantial amount of Common Stock could have the effect of delaying
or preventing a change-of-control of the Company without further action by the
stockholders (for example, by decreasing the percentage of the share ownership
of those persons seeking to obtain control). Under applicable law, the Board of
Directors is required to make any determination to issue such stock based on its
judgment as to the best interest of the Company and its stockholders at the time
of such issuance.
The affirmative vote of a majority of the Company's outstanding Common Stock
entitled to vote at the Annual Meeting is required to approve the proposal to
amend the Company's Amended and Restated Certificate of Incorporation to
increase the authorized Common Stock of the Company.
12
The Board of Directors unanimously recommends a vote "FOR" the proposal to amend
Article IV of the Amended and Restated Certificate of Incorporation of
Anadigics, Inc. for the purpose of increasing the authorized number of shares of
Common Stock.
PROPOSAL III: ADOPTION OF AMENDMENT TO CERTIFICATE OF INCORPORATION TO
GRANT THE BOARD THE RIGHT TO AMEND THE COMPANY'S BYLAWS
Proposal III seeks to amend the Company's Amended and Restated Certificate of
Incorporation to approve the addition of a new Article VII granting the Board of
Directors the power to make, alter or repeal the Company's bylaws without
obtaining stockholder approval to the extent permitted under Delaware law. If
this proposal is approved, the new Article VII would read as follows:
"ARTICLE VII
AMENDMENT OF BYLAWS
In furtherance and not in limitation of the powers
conferred by statute, and except as otherwise provided
herein or in the By-laws of the Corporation, the Board of
Directors is expressly authorized to make, alter or repeal
the By-laws of the Corporation."
This proposal is referred to herein as the "Bylaws Proposal". The Board of
Directors on April 2, 1997 unanimously proposed and declared advisable the
Bylaws Proposal. The Board of Directors believes that the Bylaws Proposal will
provide the Board with greater flexibility in governing the internal affairs and
its relationships with stockholders and other parties. In addition, the power to
amend the bylaws without the necessity of waiting for the next annual meeting of
stockholders or the delay and expense in calling a special meeting of
stockholders will enhance the Board's ability to manage the Company and more
effectively deal with changed circumstances or requirements with which it may be
presented.
Under the General Corporation Law ("GCL") of the State of Delaware, a board
of directors may amend the corporation's bylaws only if the certificate of
incorporation confers such authority on the board of directors. Whether or not a
board of directors has the power to amend the bylaws, the GCL specifically
provides that conferring such power upon the directors does not divest the power
of the stockholders to amend the bylaws. However, as discussed below, conferring
such power upon a board provides them with the authority to require a
supermajority vote of stockholders to amend bylaw provisions.
Bylaws typically provide rules and procedures for managing the business and
affairs of the corporation, such as calling and providing notice of meetings of
stockholders, quorum and voting requirements, voting and inspection procedures,
number and term of directors, nomination procedures for election of persons to
the board of directors, filling vacancies on the board and appointment of
officers and officers' duties. From time to time, it may be desirable or
necessary to add to or change bylaw provisions to reflect changes in the
Company's practices or to reflect changes in applicable law. Granting the
Company's Board of Directors the power to amend the Company's bylaws will allow
the Board of Directors to effect such change in a more efficient, cost-effective
manner without the necessity of incurring the expense and time delay of a
stockholder meeting.
Certain effects of the Bylaws Proposal may have anti-takeover implications.
The Company's present bylaws or Amended and Restated Certificate of
Incorporation contain a number of provisions with anti-takeover effect. Delaware
law permits adoption of additional measures designed to reduce a corporation's
vulnerability to hostile takeover attempts. Many of these measures or certain
other changes altering the rights of stockholders and powers of management could
be implemented in the future by amendment of the Company's bylaws. If the Bylaws
Proposal is
13
approved, the Board of Directors could consider amending the bylaws to include,
without limitation, any or all of the following provisions: a provision
requiring a supermajority vote of the Board of Directors and/or the stockholders
to amend any bylaw provision designed to reduce the Company's vulnerablilty to
hostile takeover attempts, including any amendment of the Company's staggered
Board provision; to provide that directors may only be removed for cause; to
provide for a supermajority vote of the stockholders or directors to increase
the size of the Board or fill vacancies on the Board; or to provide for advance
notice to the Board in the case of stockholder action by written consent. These
provisions, if adopted, could have the effect of discouraging or delaying a
third party from making a tender offer or otherwise attempting to obtain control
of the Company or remove incumbent management.
The Bylaws Proposal is not being proposed in order to prevent a change in
control, nor is it in response to any present attempt known to the Board of
Directors to acquire control of the Company, obtain representation on the Board
of Directors or take significant action which affects the Company. However, in
discharge of its fiduciary obligations to its stockholders, the Board of
Directors may consider and adopt certain amendments, including the defensive
strategies discussed above, to enhance the Board's ability to negotiate with an
unsolicited bidder.
The affirmative vote of a majority of the Company's outstanding Common Stock
entitled to vote at the Annual Meeting is required to approve the proposal to
amend the Company's Amended and Restated Certificate of Incorporation granting
the Board the authority to make, alter or repeal the Company's bylaws without
stockholder approval.
The Board of Directors unanimously recommends a vote "FOR" the proposal to amend
the Amended and Restated Certificate of Incorporation of Anadigics, Inc.
granting the Board of Directors the power to make, alter or repeal the Company's
Bylaws without further stockholder approval.
PROPOSAL IV: ADOPTION OF AMENDMENT TO THE 1995 LONG-TERM INCENTIVE AND
SHARE AWARD PLAN
On April 2, 1997, the Board of Directors unanimously approved an amendment to
the Company's 1995 Long-Term Incentive and Share Award Plan (the "1995 Plan") to
increase the number of shares of Common Stock issuable thereunder by 1,500,000
shares from 1,275,000 shares to 2,775,000 shares.
The 1995 Plan is intended to provide a means to attract, retain and motivate
selected employees of the Company and non-employee Directors of the Company. The
1995 Plan provides for the grant to eligible employees of incentive stock
options ("ISO"), non-qualified stock options ("NQSO"), stock appreciation
rights, restricted shares and other share based awards (collectively, "Awards").
All employees and Directors are eligible to participate in the 1995 Plan. The
portion of the 1995 Plan applicable to employees is administered by the
Compensation Committee of the Board of Directors of the Company or such other
committee designated by the Board (the "Compensation Committee"), which consists
exclusively of Directors who are "disinterested persons" within the meaning of
Rule 16b-3 under the Securities Exchange Act of 1934. The Compensation Committee
has the full and final authority to select employees to whom awards may be
granted, to determine the type of awards to be granted to such employees and to
make all administrative determina tions required by the 1995 Plan. The
Compensation Committee also has authority to waive conditions relating to an
award or accelerate vesting of awards. The 1995 Plan also provides for certain
grants of NQSO to non-employee Directors, and, in the case of such grants, is
intended to operate automatically and not require administration. While the
Company has no current intention to grant Awards other than stock options, the
Board of Directors believes that the ability to utilize different types of
equity compensation will give the Company the flexibility needed to effectively
adapt to changes in the labor market and in equity compensation practices. For a
discussion of options granted under the 1995 Plan to executive officers and
Directors of the Company, see "Compensation and Other Transactions With
Directors, Nominees and Executive Officers".
An aggregate of 1,275,000 shares have been reserved for issuance under the
1995 Plan, subject to anti-dilution
14
adjustments in the event of certain changes in the Company's capital structure.
As of March 15, 1997 approximately 1,192,328 shares are subject to options
currently outstanding under the 1995 Plan. If an Award expires or is canceled
without having been fully exercised or vested, the unvested or canceled shares
will again be available for grants of Awards under the 1995 Plan. No eligible
employee may receive options or stock appreciation rights under the 1995 Plan
for more than 100,000 shares of Common Stock (subject to adjustment) during any
calendar year. The number of shares available for grant under the 1995 Plan (and
outstanding Awards) will be adjusted as appropriate to reflect any stock splits,
stock dividends, recapitalizations, reorganizations or other changes to the
capital structure of the Company.
The grant of an option under the 1995 Plan will generally not result in
taxable income at the time of grant for the optionee or the Company. The
optionee will not have taxable income upon exercising an ISO (except that
alternative minimum tax may apply), and the Company will receive no deduction
when the ISO is exercised. Upon the exercise of a NQSO the optionee will
recognize ordinary income in the amount by which the fair market value on the
date of exercise exceeds the option price. The Company generally will be
entitled to a tax deduction for a NQSO Award in an amount equal to the ordinary
income realized by the participant at the time the participant recognizes such
income.
It is the intent of the Company to use the 1995 Plan to grant such Awards
primarily to the executive officers and Directors of the Company. A new plan,
the 1997 Long Term Incentive and Share Award Plan for Employees the "1997 Plan",
was adopted by the Board on January 24, 1997 as the principal plan through which
to grant stock and share awards to non-officer employees. An aggregate of
1,200,000 shares have been reserved for issuance under the 1997 Plan, subject to
anti-dilution adjustments in the event of certain changes in the Company's
capital structure.
The adoption of the amendment to the 1995 Long Term Incentive and Share Award
Plan requires the affirmative vote of not less than a majority of the votes
entitled to be cast by all shares of Common Stock which are present in person or
by proxy and are entitle to vote at the annual meeting. If the adoption of the
amendment is not so approved, the authorized shares available for grant under
the 1995 Plan will not change.
The Board of Directors unanimously recommends a vote "FOR" the proposal to adopt
the amendment to increase the number of shares available under the 1995 Long
Term Incentive and Share Award Plan
PROPOSAL V: APPOINTMENT OF INDEPENDENT AUDITORS
Appointment of Auditors
Ernst & Young LLP, independent certified public accountants, audited the
financial statements of ANADIGICS, Inc., for the 1996 fiscal year.
Representatives of Ernst & Young LLP are expected to attend the Annual Meeting
of stockholders and will have the opportunity to make a statement if they desire
to do so and are expected to be available to answer appropriate questions. The
Audit Committee and the Board of Directors have selected Ernst & Young LLP as
the independent auditors of the Company for the fiscal year ending December 31,
1997.
The Board of Directors unanimously recommends a vote "FOR" the ratification of
the appointment of Ernst & Young LLP as the independent auditors of the Company.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the 1998 Annual Meeting of
stockholders must be received by the Company no later than December 26, 1997.
Proposals may be mailed to the Company, to the attention of Secretary, 35
Technology Drive, Warren, NJ 07059.
OTHER MATTERS
The Board of Directors knows of no other business which will be presented at
the meeting. If any other matters properly come before the meeting, the persons
named in the enclosed proxy will vote the shares represented thereby in
accordance with their judgment on such matters.
15
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANADIGICS, Inc.
The undersigned hereby appoints Ronald Rosenzweig and John F. Lyons proxies,
with power to act without the other and with power of substitution, and hereby
authorizes them to represent and vote, as designated on the other side, all the
shares of stock of ANADIGICS, Inc. standing in the name of the undersigned with
all powers which the undersigned would possess if present at the Annual Meeting
of Stockholders of the Company to be held May 29, 1996 or any adjournment
thereof.
(Continued, and to be marked, dated and signed, on the other side)
The Board of Directors recommends a vote FOR proposals I, II, III, IV, and V
Please mark your
votes as [X]
indicated in
this example
Proposal I: ELECTION OF DIRECTORS WITHHELD
Nominees: FOR FOR ALL
Paul Bachow
George Gilbert [ ] [ ]
Charles Huang
WITHHELD FOR (Write that nominee's name in the space provided
below).
_________________________________________
Proposal II: ADOPTION OF AMENDMENT TO FOR AGAINST ABSTAIN
CERTIFICATION OF INCORPORATION [ ] [ ] [ ]
TO INCREASE THE NUMBER OF
AUTHORIZED COMMON SHARES
Proposal III: ADOPTION OF AMENDMENT TO FOR AGAINST ABSTAIN
CERTIFICATION OF INCORPORATION [ ] [ ] [ ]
TO GRANT THE BOARD THE RIGHT
TO AMEND THE COMPANY'S BYLAWS
Proposal IV: ADOPTION OF AMENDMENT TO FOR AGAINST ABSTAIN
THE 1995 LONG-TERM INCENTIVE [ ] [ ] [ ]
AND SHARE AWARD PLAN
Proposal V: APPOINTMENT OF INDEPENDENT FOR AGAINST ABSTAIN
AUDITORS [ ] [ ] [ ]
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 all proposals.
Signature(s) __________________________________ Date ___________________________
NOTE: Please sign as name appears hereon. Joint owners should each sign. When
signing as attorney, executor, administrator, trustee or guardian, please give
full title as such.
Please check here if you expect to attend the Annual Meeting of Shareholders [ ]