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. |
Time and Date:
|
Thursday, May 14, 2009 at 4:30 p.m., Pacific daylight time. | |
Place:
|
Intevacs principal executive offices, located at: 3560 Bassett Street, Santa Clara, California 95054. | |
Items of Business:
|
(1) To elect directors to serve for the ensuing year or
until their respective successors are duly elected and qualified.
|
|
(2) To approve an amendment to the Intevac 2003 Employee
Stock Purchase Plan to increase the number of shares reserved
for issuance thereunder by 600,000 shares.
|
||
(3) To ratify the appointment of Grant Thornton LLP as
Intevacs independent public accountants for the fiscal
year ending December 31, 2009.
|
||
(4) To transact such other business as may properly come
before the Annual Meeting.
|
||
These items of business are more fully described in the proxy statement accompanying this notice. | ||
Adjournments and Postponements:
|
Any action on the items of business described above may be considered at the Annual Meeting at the time and on the date specified above or at any time and date to which the Annual Meeting may be properly adjourned or postponed. | |
Record Date:
|
You are entitled to vote if you were a stockholder of record as of the close of business on March 25, 2009. | |
Voting:
|
Your vote is very important. Whether or not you plan to attend the Annual Meeting, we encourage you to read the proxy statement and submit your proxy card or vote on the Internet or by telephone as soon as possible. For specific instructions on how to vote your shares, please refer to the section entitled Questions and Answers About Procedural Matters and the instructions on the enclosed proxy card. |
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34 |
Q: | Why am I receiving these proxy materials? | |
A: | The Board of Directors of Intevac, Inc. is providing these proxy materials to you in connection with the solicitation of proxies for use at the 2009 Annual Meeting of Stockholders (the Annual Meeting) to be held Thursday, May 14, 2009 at 4:30 p.m., Pacific daylight time, or at any adjournment or postponement thereof for the purpose of considering and acting upon the matters set forth herein. The notice of Annual Meeting, this proxy statement and accompanying form of proxy card are being distributed to you on or about April 3, 2009. | |
Q: | Where is the Annual Meeting? | |
A: | The Annual Meeting will be held at Intevacs principal executive offices, located at 3560 Bassett Street, Santa Clara, California 95054. The telephone number at that location is 408-986-9888. | |
Q: | Can I attend the Annual Meeting? | |
A: | You are invited to attend the Annual Meeting if you were a stockholder of record or a beneficial owner as of March 25, 2009. You should bring photo identification for entrance to the Annual Meeting. The meeting will begin promptly at 4:30 p.m., Pacific daylight time. |
Q: | What is the difference between holding shares as a stockholder of record and as a beneficial owner? | |
A: | Stockholders of record If your shares are registered directly in your name with Intevacs transfer agent, Computershare Trust Company, N.A., you are considered, with respect to those shares, the stockholder of record. These proxy materials have been sent directly to you by Intevac. | |
Beneficial owners Many Intevac stockholders hold their shares through a broker, trustee or other nominee, rather than directly in their own name. If your shares are held in a brokerage account or by a bank or another nominee, you are considered the beneficial owner of shares held in street name. The proxy materials have been forwarded to you by your broker, trustee or nominee, who is considered, with respect to those shares, the stockholder of record. | ||
As the beneficial owner, you have the right to direct your broker, trustee or other nominee on how to vote your shares. For directions on how to vote shares beneficially held in street name, please refer to the voting instruction card provided by your broker, trustee or nominee. Since a beneficial owner is not the stockholder of record, you may not vote these shares in person at the Annual Meeting unless you obtain a legal proxy from the broker, trustee or nominee that holds your shares, giving you the right to vote those shares at the Annual Meeting. |
Q: | How many shares must be present or represented to conduct business at the Annual Meeting? | |
A: | The presence of the holders of a majority of the shares of Common Stock entitled to vote at the Annual Meeting is necessary to constitute a quorum at the Annual Meeting. Such stockholders are counted as present at the meeting if they (1) are present in person at the Annual Meeting or (2) have properly submitted a proxy. | |
Under the General Corporation Law of the State of Delaware, abstentions and broker non-votes are counted as present and entitled to vote and are, therefore, included for purposes of determining whether a quorum is present at the Annual Meeting. | ||
A broker non-vote occurs when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received instructions from the beneficial owner. | ||
Q: | Who is entitled to vote at the Annual Meeting? | |
A: | Holders of record of Intevacs common stock, par value $0.001 per share (the Common Stock) at the close of business on March 25, 2009 (the Record Date) are entitled to receive notice of and to vote their shares at the Annual Meeting. Such stockholders are entitled to cast one vote for each share of Common Stock held as of the Record Date. | |
At the Record Date, we had 21,925,526 shares of our Common Stock outstanding and entitled to vote at the Annual Meeting, held by 128 stockholders of record. We believe that approximately 4,800 beneficial owners hold shares through brokers, fiduciaries and nominees. No shares of Intevacs preferred stock were outstanding. | ||
Q: | How can I vote my shares in person at the Annual Meeting? | |
A: | Shares held in your name as the stockholder of record may be voted in person at the Annual Meeting. Shares held beneficially in street name may be voted in person at the Annual Meeting only if you obtain a legal proxy from the broker, trustee or other nominee that holds your shares giving you the right to vote the shares. Even if you plan to attend the Annual Meeting, we recommend that you also submit your proxy card or voting instructions as described below, so that your vote will be counted if you later decide not to attend the meeting. | |
Q: | How can I vote my shares without attending the Annual Meeting? | |
A: | Whether you hold shares directly as the stockholder of record or beneficially in street name, you may direct how your shares are voted without attending the Annual Meeting. If you are a stockholder of record, you may vote by submitting a proxy. If you hold shares beneficially in street name, you may vote by submitting voting instructions to your broker, trustee or nominee. For instructions on how to vote, please refer to the instructions below and those included on your proxy card or, for shares held beneficially in street name, the voting instructions provided to you by your broker, trustee or nominee. | |
By mail Stockholders of record of Intevac Common Stock may submit proxies by completing, signing and dating their proxy cards and mailing them in the accompanying pre-addressed envelopes. Proxy cards submitted by mail must be received by the time of the meeting in order for your shares to be voted. Intevac stockholders who hold shares beneficially in street name may vote by mail by completing, signing and dating the voting instructions provided by their brokers, trustees or nominees and mailing them in the accompanying pre-addressed envelopes. | ||
By Internet Stockholders of record of Intevac Common Stock with Internet access may submit proxies by following the Vote by Internet instructions on their proxy cards until 11:00 p.m., Pacific daylight time, on May 13, 2009. Most Intevac stockholders who hold shares beneficially in street name may vote by accessing the web site specified in the voting instructions provided by their brokers, trustees or nominees. Please check the voting instructions for Internet voting availability. | ||
By telephone Stockholders of record of Intevac Common Stock who live in the United States, Puerto Rico or Canada may submit proxies by following the Vote by Phone instructions on their proxy cards until 11:00 p.m., Pacific daylight time, on May 13, 2009. Most Intevac stockholders who hold shares beneficially in street name |
2
may vote by phone by calling the number specified in the voting instructions provided by their brokers, trustees or nominees. Please check the voting instructions for telephone voting availability. | ||
Q: | What proposals will be voted on at the Annual Meeting? | |
A: | At the Annual Meeting, stockholders will be asked to vote on: | |
(1) The election of six directors to serve for the ensuing
year or until their respective successors are duly elected and
qualified;
|
||
(2) An amendment to the Intevac 2003 Employee Stock
Purchase Plan to increase the number of shares reserved for
issuance thereunder by 600,000 shares; and
|
||
(3) The ratification of the appointment of Grant Thornton
LLP as independent public accountants of Intevac for the fiscal
year ending December 31, 2009.
|
||
Q: | What is the voting requirement to approve each of the proposals? | |
A: | Proposal One A plurality of the votes cast is required for the election of directors. You may vote FOR or WITHHOLD on each of the six nominees for election as director. The six nominees for director receiving the highest number of affirmative votes will be elected as directors of Intevac to serve for a term of one year or until their respective successors have been duly elected and qualified. Abstentions and broker non-votes will not affect the outcome of the election. | |
Proposal Two The affirmative vote of a majority of votes represented and voting at the Annual Meeting, or votes cast, is required for approval of the amendment to add an additional 600,000 shares to the Intevac 2003 Employee Stock Purchase Plan. You may vote FOR, AGAINST or ABSTAIN on this proposal. Abstentions are deemed to be votes cast and have the same effect as a vote against this proposal. However, broker non-votes are not deemed to be votes cast and, therefore, are not included in the tabulation of the voting results on this proposal. | ||
Proposal Three The affirmative vote of a majority of votes cast is required to ratify the appointment of Grant Thornton LLP as Intevacs independent public accountants. You may vote FOR, AGAINST or ABSTAIN on this proposal. Abstentions are deemed to be votes cast and have the same effect as a vote against this proposal . However, broker non-votes are not deemed to be votes cast and, therefore, are not included in the tabulation of the voting results on this proposal. | ||
Stockholder ratification of the selection of Grant Thornton LLP as Intevacs independent public accountants is not required by our Bylaws or other applicable legal requirements. However, the Board is submitting the selection of Grant Thornton LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of a different independent accounting firm at any time during the year, if it determines that such a change would be in the best interests of Intevac and its stockholders. | ||
Q: | How does the Board of Directors recommend that I vote? | |
A: | The Board of Directors recommends that you vote your shares: | |
FOR the election of all of the nominees
as director listed in Proposal One;
|
||
FOR the adoption of the amendment to add
an additional 600,000 shares to the Intevac 2003 Employee
Stock Purchase Plan; and
|
||
FOR the proposal to ratify the selection
of Grant Thornton LLP as Intevacs independent public
accountants for the fiscal year ending December 31, 2009.
|
||
Q: | If I sign a proxy, how will it be voted? | |
A: | All shares entitled to vote and represented by properly executed proxy cards received prior to the applicable deadlines described above (and not revoked) will be voted at the Annual Meeting in accordance with the |
3
instructions indicated on those proxy cards. If no instructions are indicated on a properly executed proxy card, the shares represented by that proxy card will be voted as recommended by the Board of Directors. | ||
Q: | What happens if additional matters are presented at the Annual Meeting? | |
A: | If any other matters are properly presented for consideration at the Annual Meeting, including, among other things, consideration of a motion to adjourn the Annual Meeting to another time or place (including, without limitation, for the purpose of soliciting additional proxies), the persons named in the enclosed proxy card and acting thereunder will have discretion to vote on those matters in accordance with their best judgment. Intevac does not currently anticipate that any other matters will be raised at the Annual Meeting. | |
Q: | Can I change or revoke my vote? | |
A: | Subject to any rules and deadlines your broker, trustee or nominee may have, you may change your proxy instructions at any time before your proxy is voted at the Annual Meeting. | |
If you are a stockholder of record, you may change your vote by (1) filing with Intevacs Secretary, prior to your shares being voted at the Annual Meeting, a written notice of revocation or a duly executed proxy card, in either case dated later than the prior proxy card relating to the same shares, or (2) by attending the Annual Meeting and voting in person (although attendance at the Annual Meeting will not, by itself, revoke a proxy). A stockholder of record that has voted on the Internet or by telephone may also change his or her vote by making a timely and valid later Internet or telephone vote. | ||
If you are a beneficial owner of shares held in street name, you may change your vote (1) by submitting new voting instructions to your broker, trustee or other nominee or (2) if you have obtained a legal proxy from the broker, trustee or other nominee that holds your shares giving you the right to vote the shares, by attending the Annual Meeting and voting in person. | ||
Any written notice of revocation or subsequent proxy card must be received by Intevacs Secretary prior to the taking of the vote at the Annual Meeting. Such written notice of revocation or subsequent proxy card should be hand delivered to Intevacs Secretary or should be sent so as to be delivered to Intevacs principal executive offices, Attention: Secretary. | ||
Q: | Who will bear the cost of soliciting votes for the Annual Meeting? | |
A: | Intevac will bear all expenses of this solicitation, including the cost of preparing and mailing these proxy materials. Intevac may reimburse brokerage firms, custodians, nominees, fiduciaries and other persons representing beneficial owners of Common Stock for their reasonable expenses in forwarding solicitation material to such beneficial owners. Directors, officers and employees of Intevac may also solicit proxies in person or by other means of communication. Such directors, officers and employees will not be additionally compensated but may be reimbursed for reasonable out-of-pocket expenses in connection with such solicitation. Intevac may engage the services of a professional proxy solicitation firm to aid in the solicitation of proxies from certain brokers, bank nominees and other institutional owners. Our costs for such services, if retained, will not be significant. | |
Q: | Where can I find the voting results of the Annual Meeting? | |
A: | We intend to announce preliminary voting results at the Annual Meeting and will publish final results in our quarterly report on Form 10-Q for the second quarter of fiscal 2009. |
Q: | What is the deadline to propose actions for consideration at next years annual meeting of stockholders or to nominate individuals to serve as directors? | |
A: | You may submit proposals, including director nominations, for consideration at future stockholder meetings. | |
Requirements for stockholder proposals to be considered for inclusion in Intevacs proxy materials Stockholders may present proper proposals for inclusion in Intevacs proxy statement and for consideration at the next annual meeting of its stockholders by submitting their proposals in writing to Intevacs Secretary in a timely |
4
manner. In order to be included in the proxy statement for the 2010 annual meeting of stockholders, stockholder proposals must be received by Intevacs Secretary no later than December 4, 2009, and must otherwise comply with the requirements of Rule 14a-8 of the Securities Exchange Act of 1934, as amended (the Exchange Act). | ||
Requirements for stockholder proposals to be brought before an annual meeting In addition, Intevacs bylaws establish an advance notice procedure for stockholders who wish to present certain matters before an annual meeting of stockholders. In general, nominations for the election of directors may be made by (1) the Board of Directors, (2) the Nominating and Governance Committee or (3) any stockholder entitled to vote who has delivered written notice to Intevacs Secretary no later than the Notice Deadline (as defined below), which notice must contain specified information concerning the nominees and concerning the stockholder proposing such nominations. | ||
Intevacs bylaws also provide that the only business that may be conducted at an annual meeting is business that is (1) specified in the notice of meeting given by or at the direction of the Board of Directors, (2) properly brought before the meeting by or at the direction of the Board of Directors or (3) properly brought before the meeting by a stockholder who has delivered written notice to the Secretary of Intevac no later than the Notice Deadline (as defined below). | ||
The Notice Deadline is defined as that date which is 120 days prior to the one year anniversary of the date on which Intevac first mailed its proxy materials to stockholders for the previous years annual meeting of stockholders. As a result, the Notice Deadline for the 2010 annual meeting of stockholders is December 4, 2009. | ||
If a stockholder who has notified Intevac of his or her intention to present a proposal at an annual meeting does not appear to present his or her proposal at such meeting, Intevac need not present the proposal for vote at such meeting. | ||
If a stockholder intends to raise a proposal at our 2009 Annual Meeting of Stockholders that is not eligible for inclusion in the proxy statement relating to the meeting and the stockholder has failed to give us notice in accordance with the requirements set forth in the Securities Exchange Act by February 19, 2009 and the bylaw notice requirements set forth above are inapplicable or waived, the proxy holders will be allowed to use their discretionary authority when and if the proposal is raised at our 2009 Annual Meeting. | ||
Q: | How may I obtain a copy of the bylaw provisions regarding stockholder proposals and director nominations? | |
A: | A copy of the full text of the bylaw provisions discussed above may be obtained by writing to the Secretary of Intevac. All notices of proposals by stockholders, whether or not included in Intevacs proxy materials, should be sent to Intevacs principal executive offices, Attention: Secretary. |
Q: | What should I do if I receive more than one set of proxy materials? | |
A: | You may receive more than one set of proxy materials, including multiple copies of this proxy statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you may receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a stockholder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each Intevac proxy card or voting instruction card that you receive to ensure that all your shares are voted. | |
Q: | How may I obtain a separate set of proxy materials or the 2008 Annual Report? | |
A: | If you share an address with another stockholder, each stockholder may not receive a separate copy of the proxy materials and 2008 Annual Report. | |
Stockholders who do not receive a separate copy of the proxy materials and 2008 Annual Report may request to receive a separate copy of the proxy materials and 2008 Annual Report by calling 408-986-9888 or by writing to Investor Relations at Intevacs principal executive offices. Alternatively, stockholders who share an address and receive multiple copies of our proxy materials and 2008 Annual Report can request to receive a single copy by |
5
following the instructions above, although each stockholder of record or beneficial owner must still submit a separate proxy card. | ||
Q: | What is the mailing address for Intevacs principal executive offices? | |
A: | Intevacs principal executive offices are located at 3560 Bassett Street, Santa Clara, California 95054. | |
Any written requests for additional information, additional copies of the proxy materials and 2008 Annual Report, notices of stockholder proposals, recommendations for candidates to the Board of Directors, communications to the Board of Directors or any other communications should be sent to this address. |
Name of Nominee
|
Position(s) with Intevac
|
Age
|
||||
Norman H. Pond
|
Chairman of the Board | 70 | ||||
Kevin Fairbairn
|
President and Chief Executive Officer | 55 | ||||
David S. Dury
|
Director | 60 | ||||
Stanley J. Hill
|
Director | 67 | ||||
Robert Lemos
|
Director | 66 | ||||
Ping Yang
|
Director | 56 |
6
7
8
9
Number of
|
Weighted
|
|||||||
Purchased
|
Average
|
|||||||
Name of Individual or Group
|
Shares | Purchase Price | ||||||
Kevin Fairbairn
|
1,001 | $ | 9.15 | |||||
Jeffrey Andreson
|
1,500 | 9.16 | ||||||
Michael Barnes
|
1,445 | 9.15 | ||||||
Luke Marusiak(1)
|
1,400 | 9.15 | ||||||
Joseph Pietras
|
| | ||||||
Ralph Kerns
|
1,086 | 9.12 | ||||||
All executive officers, as a group
|
7,435 | 9.14 | ||||||
All employees who are not executive officers, as a group
|
158,158 | 9.15 |
(1) | Mr. Marusiak resigned from the Company on October 17, 2008 |
10
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
2008
2007
$
1,286,330
$
996,645
214,631
192,039
$
1,500,961
$
1,188,684
(1)
Audit fees consist of fees billed for professional services
rendered for the audit of our annual consolidated financial
statements and review of the interim consolidated financial
statements included in our Quarterly Reports on
Form 10-Q
and fees for services that are normally provided by Grant
Thornton LLP in connection with statutory and regulatory filings
or engagements. In addition, audit fees include those fees
related to Grant Thorntons audit of the effectiveness of
our internal controls over financial reporting pursuant to
Section 404 of the Sarbanes-Oxley Act. This category also
includes advice on accounting matters that arose during, or as a
result of, the audit or the review of the interim consolidated
financial statements.
(2)
Audit related fees consist of assurance and related services
provided by Grant Thornton LLP that are reasonably related to
the performance of the audit of our consolidated financial
statements and are not reported under Audit Fees.
There were no services provided under this category in fiscal
2007 or fiscal 2008.
(3)
Tax fees consist of fees billed for tax compliance, consultation
and planning services, and include fees associated with a
research and development tax credit study.
(4)
All other fees consist of fees for other corporate related
services. There were no services provided under this category in
fiscal 2007 or fiscal 2008.
11
Table of Contents
Overseeing our accounting and financial reporting processes and
audits of our financial statements;
Assisting the Board in overseeing and monitoring (i) the
integrity of our financial statements, (ii) our compliance
with legal and regulatory requirements related to financial
affairs and reporting, (iii) our independent auditors
qualifications, independence and performance, and (iv) our
internal accounting and financial controls;
Preparing the report that the rules of the SEC require be
included in this proxy statement;
Periodically providing the Board with the results of its
monitoring and recommendations derived therefrom; and
Providing to the Board additional information and materials as
it deems necessary to make the Board aware of significant
financial matters that require the attention of the Board.
12
Table of Contents
Overseeing the entirety of our compensation and benefit
policies, plans and programs;
Overseeing the annual report on executive compensation for
inclusion in our proxy statement; and
Overseeing executive succession planning.
13
Table of Contents
The Nominating and Governance 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 and the needs of the Board 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 Nominating and Governance
Committee may consider appropriate.
While the Nominating and Governance Committee has not
established specific minimum qualifications for director
candidates, the Nominating and Governance 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 laws and regulations, such as
financial literacy or financial expertise with respect to audit
committee members.
With regard to candidates who are properly recommended by
stockholders or by other means, the Nominating and Governance
Committee will review the qualifications of any such candidate,
which review may, in the Nominating and Governance
Committees 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 Nominating and
Governance 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 Nominating and Governance 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 Stockholders
at which directors are elected.
After completing its review and evaluation of director
candidates, the Nominating and Governance Committee selects, or
recommends to the full Board of Directors for selection, the
director nominees.
14
Table of Contents
Provide a significant portion of total compensation as a
performance-based annual cash bonus based on Intevacs
overall financial performance relative to its annual financial
plan and each executives performance relative to
predetermined goals;
Directly tie total performance-based annual cash bonus expense
to profitability, so that bonuses increase with increasing
profits, decrease with decreasing profits and are not paid when
profitability is not achieved;
Provide equity-based, long-term incentives to further align the
financial interests of the executive officers with those of our
stockholders; and
Offer a total compensation package that takes into consideration
the practices of other companies with which Intevac competes for
executive talent.
Provide a total compensation package that is competitive with
our peer group, but that also takes into account the need to
compete for talent with large equipment companies such as
Applied Materials and LAM Research.
15
Table of Contents
Align compensation with the Companys performance by:
Providing a significant portion of total compensation in the
form of a performance-based annual cash bonus dependent on the
Companys profitability and each executives
performance relative to predetermined business objectives and
target financial results set at the beginning of each fiscal
year.
Providing another significant portion of total compensation in
the form of stock options, which focus each executive on
creating stockholder value over the vesting period of the
options.
Paying executive compensation that will generally be above peer
company executive compensation when Intevacs financial
performance is above peer company financial performance and
below peer company executive compensation when Intevacs
financial performance is below that of peer companies.
Increase the portion of total compensation based on
performance-based annual cash bonuses and stock options relative
to base salary with increasing executive responsibility level.
Align each executives goals with those of other executives
to encourage a team approach to problem solving.
Provide clear guidelines for each compensation element (base
salary, performance-based annual cash bonus and stock options),
while allowing the Compensation Committee flexibility to make
final decisions based on management recommendations (other than
decisions for the Chief Executive Officer and Chairman, which
are made by the independent members of the Board of Directors),
and other factors such as experience, contribution to business
success and retention needs.
Provide similar benefits to Named Executive Officers as provided
to other employees.
Advanced Energy Industries, Inc.
Brooks Automation, Inc.
Cymer, Inc
FEI Company
Formfactor, Inc.
Mattson Technology, Inc.
Rofin Sinar Technologies, Inc.
Veeco Instruments, Inc.
16
Table of Contents
Was generally above peer company executive compensation when
Intevacs financial performance was above peer company
financial performance and below peer company executive
compensation when Intevacs financial performance was below
that of peer companies; and
Was more variable as a function of performance than the Peer
Group average and that it continued to provide strong incentive
to management to optimize Intevacs financial performance.
Base salary;
Performance-based annual cash bonus targeted as a percentage of
base salary (Target Bonus Percentage); and
Periodic grants of long-term, equity-based incentives, currently
stock options with four-year annual vesting.
17
Table of Contents
2008 Base Salary
Increase as a % of
2007 Base Salary
2008 Base Salary
2007 Base Salary
$
450,008
$
468,021
4.0
%
$
250,016
$
260,021
4.0
%
$
245,814
$
270,400
10.0
%
$
260,021
$
270,442
4.0
%
$
241,322
$
255,091
5.7
%
Intevac Photonics
$
207,833
$
215,113
3.5
%
(1)
Mr. Marusiak resigned from the Company on October 17,
2008.
Target Bonus;
Bonus Pool; and
Management by Objectives
18
Table of Contents
2007 Target Bonus
2008 Target Bonus
as a Percent of
as a Percent of
Base Salary
Base Salary
200
%
200
%
75
%
75
%
75
%
75
%
75
%
75
%
75
%
75
%
75
%
75
%
Business Results:
Goals included achievements
with respect to metrics such as orders, revenues, profitability,
cash management, quality, cycle-time and other finance related
metrics that were targeted for improvement.
Market Development:
Goals included
achievements with respect to metrics such as market share, new
customers gained for particular products, and completion of
comprehensive marketing and sales plans for gaining additional
business and higher gross margins.
Product Excellence:
Goals included
achievements with respect to metrics such as target completion
dates for new products or improved products, material cost and
reliability goals for new products, product yield improvements,
field product performance and other measures as appropriate to
encourage product excellence.
Strategic Initiatives:
Goals included
achievements with respect to metrics such as business process
improvements, employee reviews, employee development, safety
goals and other measures needed to support Intevacs growth.
19
Table of Contents
2007
2008
2008
Actual Bonus
Target Bonus
Actual Bonus
$
677,465
$
936,042
$
$
100,000
$
195,016
$
$
150,645
$
202,800
$
$
145,463
$
202,800
$
$
136,239
$
191,318
$
$
115,220
$
161,335
$
20
Table of Contents
2007
2008
Option Grants
Option Grants
75,000
75,000
50,000
25,000
25,000
25,000
25,000
25,000
25,000
25,000
15,000
10,000
% Increase/
(Decrease) in
2009 Base
Salary
vs.
2008
2009
2008 Base
Base Salary
Base Salary
Salary
$
468,021
$
468,021
%
$
260,021
$
260,021
%
$
270,442
$
270,442
%
$
255,091
$
255,091
%
$
215,113
$
215,113
%
21
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2008
2009
Target Bonus(1)
Target Bonus
$
936,042
$
936,042
$
195,016
$
195,016
$
202,800
$
202,800
$
191,318
$
191,318
$
161,335
$
161,335
(1)
No bonus payments were made to the Named Executive Officers in
2008 as Proforma Annual Income before Income Taxes was a loss.
2008
2009
Option Grants
Option Grants
75,000
75,000
25,000
25,000
25,000
25,000
25,000
25,000
10,000
5,000
22
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23
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Change in
Pension
Value and
Non-Equity
Nonqualified
Option
Incentive Plan
Deferred
All Other
Stock
Awards ($)
Compensation ($)
Compensation
Compensation ($)
Year
Salary ($)
Bonus ($)
Awards ($)
(1)
(2)
Earnings ($)
(3)
Total ($)
2008
465,250
612,915
6,517
1,084,682
2007
439,518
491,750
677,465
6,296
1,615,029
2006
379,026
213,189
1,543,705
6,164
2,142,084
2008
258,482
242,024
8,803
509,309
2007
125,008
50,000
146,967
100,000
2,000
423,975
2006
2008
268,838
314,495
8,520
591,853
2007
258,482
377,831
145,463
8,612
790,388
2006
219,245
548,326
366,585
2,000
1,136,156
2008
245,333
180,753
2,000
428,086
2007
241,760
169,825
150,645
8,023
570,253
2006
215,078
71,621
351,352
6,164
644,215
2008
252,973
239,937
2,000
494,910
2007
239,891
246,147
136,239
2,000
624,277
2006
80,316
92,912
121,572
2,000
296,800
2008
213,994
156,567
6,579
377,140
2007
206,602
163,375
115,220
5,174
490,371
2006
197,029
94,750
320,462
6,164
618,405
(1)
Amounts shown do not reflect compensation actually received by
the Named Executive Officer. Instead, the amounts shown are the
compensation costs we recognized in fiscal 2008, 2007 and 2006
for option awards as determined pursuant to FAS 123(R).
These compensation costs reflect option awards granted in and
prior to fiscal 2008, 2007 and 2006. The assumptions used to
calculate the value of option awards are set forth under
Note 2 of the notes to Consolidated Financial Statements
included in our Annual Report on
Form 10-K
for fiscal 2008 filed with the SEC on March 4, 2009.
(2)
No bonuses were earned under Intevacs Executive Incentive
Plan for services rendered in fiscal 2008. 2007 and 2006 bonus
amounts consist of bonuses earned under Intevacs Executive
Incentive Plan for services rendered in fiscal 2007 and paid in
2008, and for services rendered in fiscal 2006 and paid in 2007.
(3)
Amounts consist of (i) matching contributions we made under
our tax-qualified 401(k) Plan, which provides for broad-based
employee participation, and (ii) of compensation costs we
recognized for participation in our Employee Stock Purchase Plan.
(4)
Mr. Andreson was hired on June 18, 2007 and was paid a
bonus upon his hire by Intevac.
(5)
Mr. Marusiak resigned from the Company on October 17,
2008.
24
Table of Contents
All Other
Grant Date
Option
Exercise
Fair
All Other Awards:
Awards:
or Base
Value of
Estimated Future Payouts Under Non- Equity
Number of
Number of
Price of
Stock and
Incentive Plan Awards(1)
Shares of
Securities
Option
Option
Grant
Threshold
Target
Maximum
Stock or Units
Underlying
Awards
Awards
Date
($)
($)
($)
(#)
Options (#)
($/Share)
($)(2)
08/21/08
75,000
11.16
452,074
N/A
0
936,042
N/A
08/21/08
25,000
11.16
150,691
N/A
0
195,016
N/A
08/21/08
25,000
11.16
150,691
N/A
0
202,800
N/A
08/21/08
25,000
11.16
150,691
N/A
0
202,800
N/A
08/21/08
25,000
11.16
150,691
N/A
0
191,318
N/A
08/21/08
10,000
11.16
60,276
N/A
0
161,335
N/A
(1)
Reflects threshold, target and maximum target bonus amounts for
fiscal 2008 performance under the Executive Incentive Plan, as
described in Compensation Discussion and
Analysis Compensation Components. No bonus
amounts were paid for fiscal 2008 performance under the
Executive Incentive Plan.
(2)
Reflects the grant date fair value of each equity award computed
in accordance with FAS 123(R). The assumptions used to
calculate the value of option awards are set forth under
Note 2 of the notes to Consolidated Financial Statements
included in our Annual Report on
Form 10-K
for fiscal 2008 filed with the SEC on March 4, 2009.
25
Table of Contents
Option Awards(1)
Equity Incentive
Plan Awards: Number
Number of
Number of
of Securities
Securities
Securities
Underlying
Underlying
Underlying
Unexercised
Option
Option
Unexercised Options
Unexercised Options
Unearned Options
Exercise
Expiration
(#) Exercisable
(#) Unexercisable
(#)
Price ($)
Date
174,769
2.63
01/24/2012
50,000
14.00
02/19/2014
50,000
(2)
7.53
02/01/2015
37,500
37,500
(3)
16.13
08/30/2016
18,750
56,250
(4)
16.13
08/30/2017
75,000
(5)
11.16
08/21/2018
12,500
37,500
(6)
20.20
06/21/2017
25,000
(7)
11.16
08/21/2018
2,500
12.66
09/09/2015
60,000
60,000
(8)
15.81
01/19/2016
6,250
18,750
(9)
16.13
08/30/2017
25,000
(10)
11.16
08/21/2018
25,000
25,000
(11)
17.00
08/17/2016
6,250
18,750
(12)
16.13
08/30/2017
25,000
(13)
11.16
08/21/2018
40,000
7.65
08/21/2013
10,000
9.31
06/23/2014
16,250
23,750
(14)
16.13
08/30/2017
20,000
(15)
7.72
02/08/2015
10,000
(16)
11.16
08/21/2018
(1)
Reflects options granted under the
2004 Equity Incentive Plan and the 1995 Stock Option Plan.
(2)
Assuming continued employment with
Intevac, the shares will become exercisable on February 1,
2009.
(3)
Assuming continued employment with
Intevac, 18,750 shares will become exercisable on August 30
of each 2009 and 2010.
(4)
Assuming continued employment with
Intevac, 18,750 shares will become exercisable on August 30
of each 2009, 2010 and 2011.
(5)
Assuming continued employment with
Intevac, 18,750 shares will become exercisable on August 21
of each 2009, 2010, 2011 and 2012.
(6)
Assuming continued employment with
Intevac, 12,500 shares will become exercisable on June 21
of each 2009, 2010 and 2011.
(7)
Assuming continued employment with
Intevac, 6,250 shares will become exercisable on August 21
of each 2009, 2010, 2011 and 2012.
(8)
Assuming continued employment with
Intevac, 30,000 shares will become exercisable on January
19 of each 2009 and 2010.
(9)
Assuming continued employment with
Intevac, 6,250 shares will become exercisable on August 30
of each 2009, 2010 and 2011.
(10)
Assuming continued employment with
Intevac, 6,250 shares will become exercisable on August 21
of each 2009, 2010, 2011 and 2012.
(11)
Assuming continued employment with
Intevac, 12,500 shares will become exercisable on August 17
of each 2009 and 2010.
(12)
Assuming continued employment with
Intevac, 6,250 shares will become exercisable on August 30
of each 2009, 2010 and 2011.
(13)
Assuming continued employment with
Intevac, 6,250 shares will become exercisable on August 21
of each 2009, 2010, 2011 and 2012.
(14)
Assuming continued employment with
Intevac, 10,000 shares will become exercisable on August 30
of each 2009 and 2010, and 3,750 shares will become
exercisable on August 30, 2011
(15)
Assuming continued employment with
Intevac, 20,000 shares will become exercisable on
February 8, 2009.
(16)
Assuming continued employment with
Intevac, 2,500 shares will become exercisable on August 21
of each 2009, 2010, 2011 and 2012.
26
Table of Contents
Option Awards
Stock Awards
Number of Shares
Number of Shares
Acquired on
Value Realized on
Acquired on
Value Realized on
Exercise (#)
Exercise ($)(1)
Vesting (#)
Vesting ($)
(1)
The value realized equals the difference between the option
exercise price and the fair value of Intevac common stock on the
date of exercise, multiplied by the number of shares for which
the option was exercised.
In the event of the involuntary termination from his position as
President and Chief Executive Officer for any reason not
involving good cause, conditioned upon execution of a waiver and
release of claim within 60 days of his termination or such
earlier date as may be specified in the release, the Company
will continue to pay his base salary for twelve (12) months
following such termination. If Intevac had terminated
Mr. Fairbairns employment without cause on
December 31, 2008, the last business day of our fiscal
2008, Mr. Fairbairn would have received his base salary of
$468,021 over the following 12 months.
In the event of a Change of Control after which Intevac stock
does not exist (such as purchase of the Company for cash), all
of Mr. Fairbairns unvested options outstanding at
that time will immediately vest. If Intevac had undergone such a
Change of Control as of December 31, 2008, stock options to
purchase 218,750 shares would have become immediately
vested. However, all of these shares subject to options were
under water at December 31, 2008 and would not
have provided any benefit to Mr. Fairbairn.
In the event of a Change of Control in which Intevac stock
survives, Mr. Fairbairn may elect either to retain his
unvested options or to accelerate vesting as set forth above.
In the event of a Change of Control in which stock in the
acquiring company is exchanged for Intevac stock and the
acquiring company offers to substitute options in non-Intevac
stock with an economic value equal to all of
Mr. Fairbairns unvested Intevac options, he may
either elect to accept the new stock options or accelerate
vesting as set forth above.
In the event of a Change of Control where the acquiring company
decides to not retain Mr. Fairbairn in his current position
as President and Chief Executive Officer and his employment is
therefore terminated upon the Change of Control, the Company
will pay Mr. Fairbairn an amount equal to twenty-four
(24) months of his base salary in one lump sum as soon as
possible after Mr. Fairbairns separation from service
but in no event later than March 15 of the year following the
year in which the separation from service occurred, which would
have been $936,042 as of December 31, 2008.
27
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Change in Pension
Value and
Nonqualified
Fees Earned
Non-Equity
Deferred
or Paid
Stock
Option
Incentive Plan
Compensation
All Other
in Cash
Awards
Awards
Compensation
Earnings
Compensation
Total
($)
($)
($)(1)
($)
($)
($)
($)
37,500
111,477
(2)
148,977
30,000
111,477
(2)
141,477
30,000
111,477
(2)
141,477
30,000
170,923
(3)
200,923
(1)
Amounts shown do not reflect compensation actually received by
the director. Instead, the amounts shown are the compensation
costs we recognized in fiscal 2008 for option awards as
determined pursuant to FAS 123(R). The assumptions used to
calculate the value of option awards are set forth under
Note 2 of the notes to Consolidated Financial Statements
included in our Annual Report on
Form 10-K
for fiscal 2008 filed with the SEC on March 4, 2009.
(2)
Reflects the compensation costs recognized by Intevac in fiscal
2008 for stock option grants with the following fair value as of
the grant date: (a) $34,775 for a stock option grant to
purchase 10,000 shares of common stock made on May 24,
2006 at an exercise price of $22.01 per share; (b) $33,086
for a stock option grant to purchase 7,500 shares of common
stock made on May 22, 2007 at an exercise price of $20.10
(c) $31,514 for a stock option grant to purchase
7,500 shares of common stock made on May 15, 2008 at
an exercise price of $12.52 per share; and (d) $12,102 for
a stock option grant to purchase 4,500 shares of common
stock made on August 21, 2008 at an exercise price of
$11.16 per share. The directors had options to purchase the
following shares of common stock outstanding at
December 31, 2008: Mr. Dury: 29,500 shares;
Mr. Hill: 47,500 shares; and Mr. Lemos:
49,500 shares.
28
Table of Contents
(3)
Reflects the compensation costs recognized by Intevac in fiscal
2008 for stock option grants with the following fair value as of
the grant date: (a) $94,221 for a stock option grant to
purchase 30,000 shares of common stock made on
March 20, 2006 at an exercise price of $22.40 per share;
(b) $33,086 for a stock option grant to purchase
7,500 shares of common stock made on May 22, 2007 at
an exercise price of $20.10. (c) $31,514 for a stock option
grant to purchase 7,500 shares of common stock made on
May 15, 2008 at an exercise price of $12.52 per share; and
(d) $12,102 for a stock option grant to purchase
4,500 shares of common stock made on August 21, 2008
at an exercise price of $11.16 per share. Dr. Yang had
options to purchase 49,500 shares of common stock
outstanding at December 31, 2008.
A cash payment of $7,500 per quarter for serving as a
director; and
An additional cash payment of $1,875 per quarter for serving as
Lead Director.
29
Table of Contents
(c)
Number of
(a)
(b)
Securities
Number of Securities
Weighted-Average
Remaining Available
to be Issued Upon
Exercise Price of
for Future Issuance
Exercise of
Outstanding
Under Equity
Outstanding Options,
Options, Warrants
Compensation
Warrants
and
Plans
and Rights
Rights
(1)
2,926,411
$
7.13
886,218
$
2,926,411
$
7.13
886,218
(1)
Excludes securities reflected in column (a).
(2)
Included in the column (c) amount are 132,326 shares
available for future issuance under our 2003 Employee Stock
Purchase Plan.
30
Table of Contents
Common Stock
Percentage
Beneficially Owned
Beneficially Owned
(2)
(3)
2,825,600
12.9
%
1,509,315
6.9
%
1,733,843
7.9
%
1,175,655
5.4
%
368,656
1.7
%
32,900
*
101,026
*
31,250
*
92,235
*
88,500
*
70,500
*
35,500
*
897,629
4.1
%
30,000
*
1,775,601
7.8
%
*
Less than 1%
(1)
Unless otherwise indicated in their respective footnote, the
address for each listed person is
c/o Intevac,
Inc., 3560 Bassett Street, Santa Clara, CA 95054
(2)
The number and percentage of shares beneficially owned is
determined in accordance with
Rule 13d-3
of the Exchange Act, and the information is not necessarily
indicative of beneficial ownership for any other purpose. Under
such rule, beneficial ownership includes any shares over which
the individual or entity has the right to acquire within
60 days of February 14, 2009, through the exercise of
any stock option or other right. Unless otherwise indicated in
the footnotes, each person or entity has sole voting and
investment power (or shares such powers with his or her spouse)
with respect to the shares shown as beneficially owned.
(3)
The total number of shares of Common Stock outstanding as of
February 14, 2009 was 21,925,526.
(4)
These securities are owned by various individual investors and
institutional investors, including T. Rowe Price New Horizons
Fund, Inc. (which owns 1,600,000 shares, representing 7.3%
of the shares outstanding), which T. Rowe Price Associates, Inc.
(Price Associates) serves as investment advisor with power to
direct investment and/or sole power to vote the securities. For
purposes of the reporting requirements of the Securities
Exchange Act of 1934, Price Associates is deemed to be
beneficial owner of such securities; however, Price Associates
expressly disclaims that it is, in fact, the beneficial owner of
such securities. The address of Price Associates is
100 E. Pratt Street, Baltimore, Maryland 21202. This
information was obtained from a filing made with the SEC
pursuant to Section 13(g) of the Exchange Act on
February 11, 2009.
(5)
Includes (i) 538,019 shares beneficially owned by
Barclays Global Investors, NA, (ii) 957,488 shares
beneficially owned by Barclays Global Fund Advisors and
(iii) 13,808 shares beneficially owned by Barclays
Global Investors, LTD. The address of Barclays Global Investors,
NA is 400 Howard Street, San Francisco,
31
Table of Contents
CA 94105. This information was obtained from a filing made with
the SEC pursuant to Section 13(g) of the Exchange Act on
February 5, 2009.
(6)
The address of DCM Partners LLC is 909 Third Avenue, 30th Floor,
New York, NY 10022. This information was obtained from a filing
made with the SEC pursuant to Section 13(g) of the Exchange
Act on February 17, 2009.
(7)
The address of Arnhold and S. Bleichroeder Advisers, LLC is 1345
Avenue of the Americas, New York, NY 10105. This information was
obtained from a filing made with the SEC pursuant to
Section 13(g) of the Exchange Act on February 14, 2009.
(8)
Includes 331,019 shares subject to options exercisable
within 60 days of February 14, 2009.
(9)
Includes 15,900 shares held by the Jeffrey and Maureen
Andreson Trust DTD 03/16/99, whose trustees are Jeffrey
Andreson and Maureen Andreson. Includes 12,500 shares
subject to options exercisable within 60 days of
February 14, 2009.
(10)
Includes 98,750 shares subject to options exercisable
within 60 days of February 14, 2009.
(11)
Includes 31,250 shares subject to options exercisable
within 60 days of February 14, 2009.
(12)
Includes 86,250 shares subject to options exercisable
within 60 days of February 14, 2009.
(13)
Includes 66,000 shares held by the Dury Revocable
Trust DTD 06/30/99, whose trustees are David Dury and
Anneke Dury. Includes 12,500 shares subject to options
exercisable within 60 days of February 14, 2009.
(14)
Includes 30,500 shares subject to options exercisable
within 60 days of February 14, 2009.
(15)
Includes 3,000 shares held by the Lemos Living
Trust whose trustees are Robert and Marie Lemos. Includes
32,500 shares subject to options exercisable within
60 days of February 14, 2009.
(16)
Includes 774,628 shares held by the Norman Hugh Pond and
Natalie Pond Trust DTD 12/23/80, 22,357 shares held by
the Pond 1996 Charitable Remainder Unitrust, both of whose
trustees are Norman Hugh Pond and Natalie Pond,
38,144 shares held by the Pond Family Partnership, L.P.,
Norman Hugh Pond, General Partner and 62,500 shares subject
to options exercisable within 60 days of February 14,
2009.
(17)
Includes 30,000 shares subject to options exercisable
within 60 days of February 14, 2009.
(18)
Includes 753,769 shares subject to options exercisable
within 60 days of February 14, 2009.
32
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reviewed and discussed the audited financial statements with
Grant Thornton LLP and management;
discussed with Grant Thornton LLP, Intevacs independent
public accountants, the matters required to be discussed by the
Statement on Auditing Standards No. 61, Communication with
Audit Committees, as currently in effect;
received from Grant Thornton LLP the written disclosures and the
letter from the independent auditors required by Independence
Standards Board Standard No. 1, Independence Discussions
with Audit Committees, as currently in effect, and discussed
with Grant Thornton LLP their independence; and
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.
33
Table of Contents
34
Table of Contents
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Table of Contents
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, Robert Lemos, and
Ping Yang
FOR
o
WITHHELD
o
2.
Proposal to approve an amendment to increase the maximum number of shares of Common Stock
authorized for issuance under the Companys 2003 Employee Stock Purchase Plan by 600,000
shares:
FOR
o
AGAINST
o
ABSTAIN
o
4.
Proposal to ratify the appointment of Grant Thornton LLP as independent public accountants of
Intevac for the fiscal year ending December 31, 2009:
FOR
o
AGAINST
o
ABSTAIN
o
5.
Transaction of any other business which may properly come before the meeting and any
adjournment or postponement thereof.
USING THE ENCLOSED ENVELOPE.