def14a
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant
þ
Filed by a Party other than the Registrant
o
Check the appropriate box:
o Preliminary Proxy Statement
þ Definitive Proxy Statement
o Definitive Additional
Materials
o Soliciting Material
Pursuant to §240.14a-11(c) or §240.14a-12
o Confidential, for use of
the Commission only (as permitted by Rule 14a-6(e)(2))
BTU International, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
þ No fee required
o Fee computed on table below
per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction
applies:
2) Aggregate number of securities to which transaction
applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
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Fee previously paid with preliminary materials. |
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Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or
Schedule and the date of its filing. |
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
BTU INTERNATIONAL, INC.
23 Esquire Road
North Billerica, Massachusetts 01862-2596, USA
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 26, 2005
Notice is hereby given that the Annual Meeting of Stockholders
of BTU International, Inc. will be held at the offices of the
Company, 23 Esquire Road, North Billerica, Massachusetts, at
10:00 A.M. on Thursday, May 26, 2005, for the
following purposes:
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1. To elect six directors to serve
for the ensuing year. |
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2. To transact any other business
that may properly come before the meeting or any adjournment
thereof. |
Stockholders of record at the close of business on
April 15, 2005 are entitled to notice of and to vote at the
meeting.
If you are unable to be present personally, please sign and date
the enclosed proxy and return it promptly in the enclosed
envelope.
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By Order of the Board of Directors |
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John E. Beard
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Secretary |
North Billerica, Massachusetts
April 27, 2005
ANNUAL MEETING OF STOCKHOLDERS
May 26, 2005
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of
Directors of BTU International, Inc. (“BTU” or the
“Company”) to be voted at the Annual Meeting of
Stockholders (the “Meeting”) to be held on
May 26, 2005 or at any adjournment thereof. The cost of
soliciting proxies will be borne by BTU. Directors, officers and
employees of BTU, without additional remuneration, may also
solicit proxies by telephone, telegraph or personal interview.
BTU will reimburse banks, brokerage firms and other custodians,
nominees and fiduciaries for reasonable expenses incurred by
them in sending proxy materials to the beneficial owners of
shares.
The holders of record of shares of Common Stock, par value
$.01 per share, of the Company (the “Common
Stock”) at the close of business on April 15, 2005 are
entitled to notice and to vote at the Meeting. There were
7,230,063 of Common Stock outstanding on that date, each of
which is entitled to one vote on each matter to come before the
Meeting.
Shares of Common Stock represented by proxies in the form
enclosed, if properly executed and returned and not revoked,
will be voted as specified, but where no specification is made,
the shares will be voted to fix the number of directors at six
and for the election as directors of the nominees named below.
To be voted, proxies must be filed with the Secretary prior to
voting. A proxy may be revoked at any time before it is voted by
filing a notice of such revocation with the Secretary.
The holders of a majority of the issued and outstanding shares
of Common Stock, present in person or represented by proxy and
entitled to vote, will constitute a quorum for the transaction
of business at the Meeting. Directors are elected by a plurality
of the votes cast at the meeting for the election of directors.
The person designated as the election inspector will count
shares represented by proxies that withhold authority to vote
for a nominee for election as a director or that reflect
abstentions only as shares that are present and entitled to vote
on the matter for the purposes of determining the presence of a
quorum, but neither abstentions nor proxies that withhold
authority will have any effect on the outcome of voting on the
matter.
The Annual Report on Form 10-K for BTU’s fiscal year
ended December 31, 2004 has been mailed with this proxy
statement. This proxy statement and the enclosed proxy were
mailed to stockholders on the same date as the date of the
Notice of Annual Meeting of Stockholders. The principal
executive offices of BTU are located at 23 Esquire Road, North
Billerica, Massachusetts 01862-2596.
ELECTION OF DIRECTORS
The persons named in the enclosed proxy intend to vote each
share as to which a proxy has been properly executed and
returned and not revoked to fix the number of directors at six
and in favor of the election as directors of the six nominees
named below, all of whom are now directors of BTU, unless
authority to vote for the election of any or all of such
nominees is withheld by marking the proxy to that effect.
The persons elected as directors will serve until the next
annual meeting of stockholders and until their successors are
elected and shall qualify. It is expected that each of the
nominees will be able to serve, but if any nominee is unable to
serve, the proxies reserve discretion to vote or refrain from
voting for a substitute nominee or nominees or to fix the number
of directors at a lesser number.
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Business Experiences and |
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Director | |
Name |
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Current Directorships |
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Age | |
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Since | |
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Paul J. van der Wansem
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President, Chief Executive Officer (1979-2002) Returning to
position in Oct. 2004. Chairman of the Board of Directors of the
Company. 1979-present. |
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65 |
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1979 |
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J. Chuan Chu
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Director; Chairman of Columbia International Corporation, an
engineering firm; Senior Advisor, Office of the President of SRI
International, an international consulting firm; Director,
Interproject Corp., an international construction and trading
company; Senior Research Professor, Development Research Center,
State Council, China.(2) |
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85 |
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1991 |
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Joseph F. Wrinn
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Director; Vice President, Platform Engineering Manager,
Semiconductor Test Division of Teradyne, Inc. since 1996.(1)(2) |
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51 |
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1999 |
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John E. Beard
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Director; Of Counsel, Ropes & Gray LLP, a law firm,
Partner 1967-2000; Director, The Timberland Company, a producer
of footwear and apparel; Trustee, Century Shares Trust, a mutual
fund; Trustee, Century Small Cap Select Fund, a mutual fund. |
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72 |
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2002 |
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G. Mead Wyman
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Director; Director, Grupo Guayacan, Inc., a Puerto Rico based
non-profit private equity management company; Director,
Strategic Lumber Resources Inc., a private company that
pre-finishes lumber used in the construction industry; Retired
Senior Vice President, Treasurer and Chief Financial Officer of
Mercury Computer Systems Inc.(1)(2) |
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64 |
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2004 |
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J. Samuel Parkhill
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Director; President and Chief Executive Officer of The Hall
Corporation since 1995 (formerly The Stackpole Corporation), a
privately held company formerly involved in manufacturing
operations.(1)(2) |
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67 |
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2004 |
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(1) |
Member of Audit Committee. |
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(2) |
Member of Stock Option and Compensation Committee. |
During 2004, the Board of Directors held six meetings.
Mr. Van der Wansem, Mr. Wyman, Mr. Parkhill, and
Mr. Beard attended 100% of the Board and relevant committee
meetings. Mr. Wrinn attended 83% and Dr. Chu attended
50% of the Board and relevant committee meetings. Each director
who is not an officer or employee of the Company receives an
annual retainer. For 2004, the annual retainer for directors was
$10,000, paid in two $5,000 installments, of which the directors
are permitted to elect to take up to one-half in the form of
stock options. The number of shares subject to options granted
pursuant to any such election by a director is equal to twice
the number of shares determined by dividing the cash amount by
the fair market value of the Common Stock on the date of the
award.
The exercise price of such options is equal to the fair market
value of the Common Stock on the date of the award. Under this
program, Mr. Beard, Dr. Chu and Mr. Wrinn each
received an option to purchase 901 shares of Common
Stock at an exercise price of $5.55 per share on
April 1, 2004. Mr. Wyman and Mr. Parkhill became
Board members in April 2004 and each received 4,000 options at
an exercise price of
2
$5.35 and $5.39 respectively. On October 1, 2004,
Mr. Beard, Dr. Chu, Mr. Wrinn, Mr. Wyman and
Mr. Parkhill also each received an option to
purchase 1,389 shares of Common Stock at an exercise
price of $3.60 per share. Each non-employee director
receives $750 for each Board meeting attended and $500 for each
committee meeting attended.
Under the Company’s 1998 Stock Option Plan for Non-Employee
Directors, on May 27, 2004, Mr. Beard, Dr. Chu,
Mr. Wrinn, Mr. Wyman and Mr. Parkhill each
received an option to purchase 2,000 shares of Common
Stock with an exercise price equal to the fair market value of
the stock on that date ($5.25 per share). These options
become exercisable with respect to one-fourth of the shares on
each of the first four anniversaries of the date of grant, and
expire seven years from the date of grant.
The Company’s compensation for non-employee directors is as
follows:
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1. |
New Directors receive 4,000 shares upon appointment to the
board. |
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2. |
The annual retainer is $10,000, which can be paid either in cash
or in cash and stock options. The formula for options granted
pursuant to any such election by a director is equal to twice
the number of shares determined by dividing the cash amount by
the fair market value of the Common Stock on the date of the
award. The exercise price of such options is equal to the fair
market value of the Common Stock on the date of the award. |
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3. |
Directors serving as Chairman of committees receive an extra
$2,500 per year in cash. |
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4. |
Annual Director Stock options are 2,000 shares. |
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5. |
Board meetings and committee meetings (if separate from a Board
meeting) compensation is $750 and $500 per meeting,
respectively. |
The Audit Committee in 2004 was comprised of G. Mead Wyman
(Chairman), J. Samuel Parkhill and Joseph F. Wrinn, who are not
employees of the Company and are “independent” as
defined in Rule 4200(a)(15) of the NASDAQ listing
standards. The Committee held five meetings during 2004. The
Committee recommends to the Board of Directors the independent
public accountants to be engaged by the Company; reviews with
the independent public accountants and management the
Company’s internal accounting procedures and controls; and
reviews with the independent public accountants the scope and
results of the auditing engagement. The Board determined that
Mr. Wyman is an “audit committee financial
expert.” The revised charter of the Audit Committee is
attached as Exhibit A to this proxy.
The Stock Option and Compensation Committee was comprised in
2004 of Joseph F. Wrinn (Chairman), J. Chuan Chu, G. Mead Wyman
and J. Samuel Parkhill). The Committee administers the
Company’s stock option and compensation plans and provides
recommendations to the Board of Directors regarding compensation
matters. The Committee held four meetings during 2004.
The Company had no nominating committee in 2004 because the size
of the Board and the size of the Company did not warrant a
separate committee.
Although there are no definite qualifications for service as a
director of BTU International, Inc., the Company seeks
candidates for director who will have the integrity, business
experience, commitment and independence to act in the best
interest of the Company and its stockholders. Each director is
urged to suggest appropriate candidates to the Chairman of the
Board for consideration. The Board of Directors will also
consider recommendations by stockholders and will evaluate any
such recommended candidates against the same criteria as
internally generated candidates. A stockholder may recommend a
nominee by writing to Director Nominations, Board of Directors,
BTU International, Inc. 23 Esquire Road, N. Billerica, MA 01862.
Any nominees for the Board of Directors of the Company will be
evaluated and recommended by a majority of the independent
directors.
All of our Board members, except for Paul van der Wansem, are
independent. Our Board members are encouraged to attend the
Company’s Annual Meeting. In some cases, this has been
impractical due to other obligations. Last year all members of
the Board of Directors attended the annual meeting.
3
Communications from Stockholders
Any stockholder wishing to communicate with the Board may do so
by writing to the Board of Directors, c/o BTU
International, 23 Esquire Road, N. Billerica, Massachusetts
01862. These communications will be forwarded to the Chairman of
the Audit Committee, who will determine what action to take with
respect to the communication, including where appropriate
providing copies of the communication to the other directors.
Section 16(a) Beneficial Ownership Reporting
Compliance
Under Section 16(a) of the Securities Exchange Act of 1934,
as amended, the Company’s directors, its officers and any
persons holding more than ten percent of the Company’s
Common Stock are required to report to the Securities and
Exchange Commission their holdings of and transactions in the
Common Stock of the Company. Specific due dates for these
reports have been established, and the Company is required to
report in this proxy statement any failure during 2004 to file
by these dates. The Company’s directors, officers and ten
percent holders satisfied all of these filing requirements for
2004. In making these statements, the Company has relied on the
written representations of its directors, officers and ten
percent holders and copies of the reports that they have filed
with the Commission and the Company.
Beneficial Ownership of Shares
The following table sets forth certain information regarding
beneficial ownership as of April 8, 2005 of the
Company’s Common Stock (i) by each person known by the
Company to own beneficially more than 5% of the Company’s
Common Stock, (ii) by each of the Company’s directors
and nominees, (iii) by each executive officer of the
Company listed below in the Summary Compensation Table and
(iv) by all directors and executive officers of the Company
as a group. Unless otherwise noted below, the address of each
person is 23 Esquire Road, North Billerica, MA 10862.
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Common Stock | |
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Beneficially Owned(1) | |
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Number of | |
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Percent of | |
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Shares | |
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Class | |
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Directors and Executive Officers
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Paul J. van der Wansem(2)
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1,997,775 |
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25.9 |
% |
Mark R. Rosenzweig
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25,500 |
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* |
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J. Chuan Chu(3)
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22,137 |
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* |
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Joseph F. Wrinn(3)
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18,730 |
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* |
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John E. Beard(3)(8)
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19,859 |
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* |
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G. Mead Wyman(3)
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1,500 |
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* |
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J. Samuel Parkhill(3)
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1,500 |
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* |
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Thomas P. Kealy(4)
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40,905 |
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* |
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James M. Griffin(4)
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70,000 |
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* |
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All directors and executive officers as a group
(8 persons)(5)
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2,172,406 |
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28.2 |
% |
5% Beneficial Owners
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FMR Corp.(6)
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578,900 |
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8.1 |
% |
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82 Devonshire Street
Boston, MA 02109 |
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Dimensional Fund Advisors Inc.(7)
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414,151 |
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5.8 |
% |
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1299 Ocean Avenue
Santa Monica, CA 90401 |
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* |
Less than one percent |
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(1) |
Except as otherwise noted, each person or entity named in the
table has sole voting and investment power with respect to all
shares of Common Stock shown as beneficially owned by him or it. |
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(2) |
Includes: (i) 101,000 shares of Common Stock held by
trusts, of which Mr. van der Wansem is a trustee, for the
benefit of certain members of Mr. van der Wansem’s
family (Mr. van der Wansem disclaims beneficial ownership in the
shares held in these trusts); (ii) 225,000 shares held
in a family limited partnership, in which Mr. van der
Wansem is a general partner and a limited partner;
(iii) 85,000 shares held by Mrs. van der Wansem,
of which Mr. van der Wansem disclaims beneficial ownership;
and (iv) 151,525 shares for Mr. van der Wansem
represented by options exercisable within 60 days of the
record date. Mr. van der Wansem’s address is
c/o BTU International, Inc. |
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(3) |
Includes 16,730 for Dr. Chu, 17,730 for Mr. Wrinn,
9,859 for Mr. Beard, 1,500 for Mr. Wyman and 1,500 for
Mr. Parkhill represented by options exercisable within
60 days of the record date. |
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(4) |
Includes 24,375 shares for Mr. Kealy and 67,000 for
Mr. Griffin represented by options exercisable within
60 days of the record date. |
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(5) |
Includes 290,219 shares represented by options, which are
exercisable within 60 days of the record date. |
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(6) |
According to information filed on February 14, 2005 with
the Securities and Exchange Commission in a report on
Schedule 13G, each of Edward C. Johnson 3d, FMR Corp.,
through its wholly owned subsidiary Fidelity
Management & Research Company (“Fidelity”),
and the Fidelity Low-Priced Stock Fund (“the Fund”)
has sole power to dispose of the 578,900 shares owned by
the Fund. Fidelity carries out voting of the shares under
written guidelines established by the Fund’s Board of
Trustees. |
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(7) |
According to information filed on February 9, 2005 with the
Securities and Exchange Commission in a report on
Schedule 13G, Dimensional Fund Advisors Inc.
(“Dimensional”) is an investment advisor registered
under Section 203 of the Investment Advisors Act of 1940,
furnishes investment advice to four investment companies
registered under the Investment Company Act of 1940, and serves
as investment manager to certain other commingled group trusts
and separate accounts. Dimensional possesses voting and/or
investment power over the securities of the Company described in
the schedule and may be deemed to be the beneficial owner of
these shares. However, all the securities are owned by advisory
clients of Dimensional and Dimensional disclaims beneficial
ownership of such securities. |
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(8) |
Mr. Beard is the direct owner of 5,000 shares and
indirectly owns and shares the power to vote or dispose of
5,000 shares as the co-trustee of shares held in a family
partnership of which Mr. van der Wansem is general partner. |
5
Executive Compensation
The following table sets forth information with respect to
compensation paid to or accrued on behalf of the persons who on
December 31, 2004 were the chief executive officer,
chairman of the board of directors and the two other most highly
paid executive officers of the Company (the “Named
Executive Officers”), for services to the Company for the
years 2002, 2003 and 2004.
Summary Compensation Table
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Long-Term Compensation | |
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Awards | |
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Annual Compensation | |
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Securities | |
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Stock | |
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Underlying | |
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All Other | |
Name and Principal Position |
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Year | |
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Salary($) | |
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Bonus($) | |
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Awards($) | |
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Options(#) | |
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Compensation($)(1) | |
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Paul J. van der Wansem
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2004 |
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79,236 |
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0 |
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— |
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250,768 |
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Chairman of the Board |
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2003 |
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155,079 |
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0 |
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— |
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153,872 |
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of Directors; CEO |
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2002 |
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256,145 |
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0 |
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50,000 |
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282,113 |
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until 7/8/2002
CEO 10/1/2004 to present |
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Mark R. Rosenzweig
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2004 |
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254,086 |
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0 |
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— |
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347,113 |
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President, Chief Executive |
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2003 |
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318,339 |
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0 |
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50,000 |
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5,178 |
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Officer and Director |
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2002 |
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142,102 |
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0 |
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74,000 |
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170,000 |
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928 |
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until 10/1/2004 |
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Thomas P. Kealy
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2004 |
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115,973 |
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0 |
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— |
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2,728 |
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Vice President, Corporate |
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2003 |
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116,287 |
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0 |
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7,500 |
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2,722 |
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Controller and Chief |
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2002 |
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112,284 |
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0 |
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7,500 |
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982 |
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Accounting Officer |
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James M. Griffin
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2004 |
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138,758 |
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0 |
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— |
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3,068 |
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Vice President of Sales — |
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2003 |
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130,917 |
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0 |
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8,000 |
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3,000 |
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Americas |
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2002 |
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134,456 |
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0 |
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7,500 |
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1,154 |
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(1) |
Amounts for 2004 consist of Company contributions to individual
401(k). In the case of Mr. van der Wansem,
$250,000 is from consulting fees and Chairman of the Board
Compensation related to his retirement agreement. In the case of
Mr. Rosenzweig, $342,863 is related to severance payments
from Oct. 2004 thru Sept. 2005. |
Option Grants in 2004
There were no options granted to the Named Executive Officers
during 2004.
6
The table below sets forth information with respect to option
exercises during 2004 and the number and aggregate value on
December 31, 2004 of options held by the named executive
officers.
Aggregated Option Exercises in
Last Fiscal Year and FY-End Option Value
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Number of | |
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(1) Value of | |
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Securities | |
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Unexercised | |
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Underlying | |
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In-the-Money | |
|
|
Shares | |
|
|
|
Unexercised Options | |
|
Options at | |
|
|
Acquired on | |
|
|
|
at December 31, | |
|
December 31, | |
|
|
Exercise | |
|
Value | |
|
Exercisable/ | |
|
Exercisable/ | |
Name |
|
(#) | |
|
Realized($) | |
|
Unexercisable (#) | |
|
Unexercisable($) | |
|
|
| |
|
| |
|
| |
|
| |
Mark R. Rosenzweig
|
|
|
5,000 |
|
|
|
5,705 |
|
|
|
0/0 |
|
|
|
0/ 0 |
|
Paul J. van der Wansem
|
|
|
0 |
|
|
|
0 |
|
|
|
151,525/ 37,175 |
|
|
|
29,725/ 29,725 |
|
Thomas P. Kealy
|
|
|
0 |
|
|
|
0 |
|
|
|
24,375/ 11,625 |
|
|
|
4,459/ 4,459 |
|
James M. Griffin
|
|
|
0 |
|
|
|
0 |
|
|
|
67,000/ 13,500 |
|
|
|
4,459/ 4,459 |
|
Value is based on the closing sales price of the Company’s
Common Stock on December 31, 2004, the last trading day of
2004 ($3.049), less the applicable option exercise price.
Compensation Committee Interlocks and Insider
Participation
Messrs. Wyman, Parkhill, Chu, and Wrinn, none of whom is or
was an officer or employee of the Company or had any
relationship with the Company requiring disclosure in this proxy
statement during 2004, served on the Compensation Committee.
Employment Contracts
The Company has an employment agreement with Paul J. van der
Wansem dated February 18, 2005.
Mr. van der Wansem is the Chairman of the Board
of Directors and the Chief Executive Officer of the Company. The
Agreement was approved by the Company’s Compensation
Committee on February 18, 2005 and was effective as of
October 1, 2004.
The following is a brief description of the material terms and
conditions of the Agreement:
Subject to earlier termination provisions, the term of
employment is indefinite, and is effective as of October 1,
2004.
Mr. van der Wansem receives a salary at the annual rate of
$276,000, payable in regular payroll practices of the Company.
He is also generally entitled to participate in any and all
benefit plans from time to time in effect for Company executives.
The amount of bonus compensation for which Mr. van der
Wansem is eligible in each fiscal year ranges from 0 to 70%
calculated on the basis of $350,000 of annual income and will be
35% of that amount if the Board determines that the Company has
achieved all of its performance at targeted levels.
If Mr. van der Wansem’s employment is terminated in
the event of death or disability or if he terminates his
employment with the Company for other than Good Reason, then the
Company will pay to him: (i) base salary through the
termination date, (ii) vacation earned but not used,
(iii) any bonus for the preceding year to the extent earned
but not yet paid, (iv) if he has worked at least
90 days during the fiscal year, a pro-rated portion of the
current year’s bonus, and (v) business expenses
incurred but not yet paid.
If Mr. van der Wansem is terminated by the Company for
Cause (as such term is defined in the Agreement), then the
Company will pay to him: (i) base salary through the
termination date, (ii) vacation earned but not used,
(iii) any bonus for the preceding year to the extent earned
but not yet paid and (iv) business expenses incurred but
not yet paid.
7
If Mr. van der Wansem is terminated by the Company for
reasons other than for Cause, or if he terminates his employment
with the Company for Good Reason (as such term is defined in the
Agreement), then the Company will pay to him: (i) base
salary through the termination date, (ii) vacation earned
but not used, (iii) any bonus for the preceding year to the
extent earned but not yet paid, (iv) business expenses
incurred but not yet paid, and (v) an amount equal to his
base salary, at his then current rate of pay, for a period equal
to twelve months.
If there occurs a change of control (as defined in the
Agreement) and if Mr. van der Wansem’s
employment is terminated other than for Cause, the Company will
pay him the amounts in the preceding bullet (except that the
twelve months’ base salary will be in a lump-sum payment),
and the Company will accelerate the exercisability of any
options he holds and cancel any restrictions on any restricted
stock that he holds.
Mr. van der Wansem has agreed to confidentiality provisions and
to a one-year post-termination non-competition agreement. In
addition, Mr. van der Wansem and the Company have
agreed that the Company will cease making consulting payments to
him under his Retirement Agreement but that upon his termination
of employment the Company will make a lump-sum payment to him
equal to the payments foregone. If his employment terminates
before the end of the consulting period, the consulting period
will resume on that date. In all other respects, the Retirement
Agreement and remains in full force effect.
Also, as part of the agreement, the Company will compensate
Mr. van der Wansem $100,000 per year in
connection with his responsibilities as Chairman of the Board
for the period July 2003 through June 2007. The Company will
recognize these amounts as the services are performed. The
agreement also provides for certain settlement amounts if
Mr. van der Wansem responsibilities as Chairman
of the Board are terminated.
In addition, the Company has an employment agreement with Mark
Rosenzweig dated July 8, 2002.
Mr. Rosenzweig resigned from the Company on
September 29, 2004. He is entitled to receive his base
salary through the date of termination, any bonus payable from
the previous fiscal year, and a pro rata portion of any bonus
for the then current fiscal year if the termination occurs in
the second half, which is referred to as his “final
compensation.” In addition to final compensation, he is
entitled to receive base salary for the remainder of the
original term or 12 months, whichever is longer, (unless he
finds other employment) automobile and life insurance benefits
for three months and medical and dental benefits for up to six
months.
Equity Compensation Plan Benefit Information
The following table gives information about BTU
International’s common stock that may be issued upon the
exercise of options, warrants and rights under all of BTU
International’s existing equity compensation plans as of
December 31, 2004.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b) | |
|
(c) | |
|
|
(a) | |
|
|
|
Number of securities | |
|
|
Number of securities | |
|
|
|
remaining available for | |
|
|
to be issued upon | |
|
Weighted-average | |
|
future issuance under | |
|
|
exercise of outstanding | |
|
exercise price of | |
|
equity compensation plans | |
|
|
options, warrants, and | |
|
outstanding options, | |
|
(excluding securities | |
Plan category |
|
rights | |
|
warrants, and rights | |
|
reflected in column (a)) | |
|
|
| |
|
| |
|
| |
Equity compensation plans approved by shareholders
|
|
|
729,139 |
|
|
$ |
4.43 |
|
|
|
1,070,000 |
(1) |
Equity compensation plans not approved by shareholders
|
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
Total
|
|
|
729,139 |
|
|
$ |
4.43 |
|
|
|
1,070,000 |
|
|
|
(1) |
Up to 100,000 shares of Common Stock may be issued other
than upon the exercise of options, warrants and rights under our
2003 Equity Incentive Plan. |
8
Report of the Compensation Committee on Executive
Compensation
The Compensation Committee has submitted the following report:
Compensation for executive officers consists of three
components: base salary; cash incentive compensation and equity
compensation. Company executive base salary compensation is
arrived at through market survey analysis, functional
responsibility and expected contribution to the results of the
business. For cash incentive compensation, the Compensation
Committee, in conjunction with the full Board of Directors,
reviews and approves incentive compensation plans for the
Company’s executive officers based on attaining certain
goals. These goals included both earnings per share target and
the accomplishment of specific organizational goals. Because of
the losses during 2004 no incentive compensation was paid under
this plan.
The Company awards stock options and or restricted stock to
executive officers as a component of an overall compensation
package. The Company believes that stock options can help better
align the interests of the executive officers with those of
stockholders generally.
|
|
|
G. Mead Wyman |
|
J. Samuel Parkhill |
|
J. Chuan Chu |
|
Joseph F. Wrinn, Chairman |
Report of the Audit Committee
The Audit Committee held five meetings during 2004. The Audit
Committee recommends to the Board of Directors the independent
public accountants to be engaged by the Company; reviews with
such auditors and management the Company’s internal
accounting procedures and controls; and reviews with such
auditors the audit scope and results of their audit of the
consolidated financial statements of the Company. The Audit
Committee adopted a revised committee charter in May 2004, a
copy of which was filed as part of the 2004 Proxy Statement.
The Audit Committee has reviewed and discussed the
Company’s audited consolidated balance sheets as of
December 31, 2004 and 2003 and the related consolidated
statements of operations, comprehensive income,
stockholders’ equity and cash flows for each of the three
years in the period ended December 31, 2004 with BTU
International, Inc.’s management. The Audit Committee has
discussed with Vitale, Caturano and Co. PC (“Vitale”),
the Company’s independent accountants, the matters required
to be discussed by Statement of Auditing Standards No. 61
(concerning the accounting methods used in the financial
statements).
The Audit Committee has also reviewed with Vitale the
Independent Standards Board No. 1 concerning the matters
that may affect the accountant’s independence and has
discussed with Vitale their independence. Based on the foregoing
review and discussion, the Audit Committee recommended to the
Board of Directors that the audited financial statements be
included in the Company Annual Report on Form 10-K for the
year ended December 31, 2004 for filing with the Securities
and Exchange Commission.
|
|
|
J. Samuel Parkhill |
|
Joseph F. Wrinn |
|
G. Mead Wyman, Chairman |
9
Independent Auditors and Audit Fees
The Board of Directors, upon recommendation of the Audit
Committee, selected Vitale as independent auditors of the
Company for the year ending December 31, 2004. The Audit
Committee has not yet formally recommended an independent
auditor for the year ending December 31, 2005. This will be
addressed at our Audit Committee meeting scheduled for
May 26, 2005. We expect that representatives of Vitale will
be present at the annual meeting.
The following table describes the fees that Vitale billed to the
Company for the fiscal year ended December 31, 2004 and
December 31, 2003.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Audit- | |
|
|
|
|
|
|
|
|
|
|
Related | |
|
|
|
|
|
|
|
|
Audit Fees | |
|
Fees | |
|
Tax Fees | |
|
Other Fees | |
|
Total Fees | |
|
|
| |
|
| |
|
| |
|
| |
|
| |
2004
|
|
|
$125,500 |
|
|
$ |
10,000 |
|
|
$ |
21,000 |
|
|
$ |
0 |
|
|
$ |
156,500 |
|
2003
|
|
|
$91,000 |
|
|
$ |
0 |
|
|
$ |
31,150 |
|
|
$ |
0 |
|
|
$ |
122,150 |
|
Comparative Stock Performance
The following graph shows the cumulative total return on BTU
Common Stock since December 31, 1999 compared to the
Standard & Poors 500 Index and the Standard &
Poors Technology Sector Index. Historical stock price
performance is not necessarily indicative of future performance.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG BTU INTERNATIONAL, INC., THE S&P 500 INDEX
AND THE S&P INFORMATION TECHNOLOGY INDEX
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BTU INTERNATIONAL, | |
|
|
|
S & P INFORMATION | |
|
|
INC. | |
|
S & P 500 | |
|
TECHNOLOGY | |
|
|
| |
|
| |
|
| |
Dec 99
|
|
|
100.00 |
|
|
|
100.00 |
|
|
|
100.00 |
|
Dec 00
|
|
|
132.61 |
|
|
|
90.89 |
|
|
|
59.10 |
|
Dec 01
|
|
|
75.48 |
|
|
|
80.09 |
|
|
|
43.81 |
|
Dec 02
|
|
|
36.66 |
|
|
|
62.39 |
|
|
|
27.42 |
|
Dec 03
|
|
|
61.22 |
|
|
|
80.29 |
|
|
|
40.37 |
|
Dec 04
|
|
|
53.03 |
|
|
|
89.02 |
|
|
|
41.40 |
|
|
|
* |
$100 INVESTED ON 12/31/99 IN STOCK OR INDEX- |
INCLUDING REINVESTMENT OF DIVIDENDS.
FISCAL YEAR ENDING DECEMBER 31.
Audit Matters
Vitale has examined the financial statements of the Company for
the year ended December 31, 2004. A representative of
Vitale is expected to be present at the Annual Meeting and will
be afforded the opportunity to make a statement and to respond
to appropriate questions from stockholders.
10
Stockholder Proposals
Proposals of stockholders to be included in the Company’s
proxy statement for the 2006 Annual Meeting must be received by
the Company no later than December 17, 2005. For
stockholder proposals at the 2006 annual meeting of stockholders
that will not be included in the Company’s proxy statement,
unless notice of such a proposal is received by the Company at
its corporate headquarters, Attention John E. Beard, Secretary,
on or before February 25, 2006, the management proxies with
respect to such meeting will confer discretionary voting
authority with respect to any such matter.
Other Business
The Board of Directors knows of no business that will come
before the meeting for action except as described in the
accompanying Notice of Annual Meeting of Stockholders. However,
as to any such business, the persons designated as proxies will
have discretionary authority to act in their best judgment.
Form 10-K
A copy of BTU’s annual report on Form 10-K filed
with the Securities and Exchange Commission is provided to you
concurrently with this Proxy Statement.
11
Exhibit A
CHARTER OF THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS OF
BTU INTERNATIONAL, INC. (THE “COMPANY”)
1. Purpose. The purpose of the Audit Committee shall
be to (a) appoint, oversee and replace, if necessary, the
independent auditor, (b) assist the Board of
Director’s oversight of (i) the preparation of the
Company’s financial statements, (ii) the
Company’s compliance with legal and regulatory requirements
in the area of financial accounting, (iii) the independent
auditor’s qualifications and independence, (iv) the
performance of the Company’s internal audit function and
independent auditor; and (c) prepare the report the SEC
rules require be included in the Company’s annual proxy
statement.
2. Composition of the Audit Committee. The Committee
shall consist of not less than three board members appointed by
the Board of Directors of the Company. Committee members may be
removed by the Board of Directors in its discretion. Each member
of the Committee shall satisfy the independence requirements of
the Sarbanes-Oxley Act of 2002 and the NASDAQ Stock Market, Inc.
Members of the Committee shall be versed in reading and
understanding financial statements. No member of the Committee
may sit on more than three separate audit committees. At least
one member of the Audit Committee shall be a financial expert as
defined by the SEC.
3. Meetings of the Audit Committee. The Committee
shall hold at least four regularly scheduled meetings and such
special meetings as circumstances dictate. It shall meet
separately, at least quarterly, with management, with the
internal auditors (or other personnel responsible for the
internal audit function), and with the independent auditor to
discuss results of examinations, or discuss any matters that the
Committee or any of these persons or firms believe should be
discussed privately. The Committee shall report regularly to the
Board of Directors.
4. Responsibilities of the Audit Committee. The
function of the Committee is oversight. The Committee has direct
and sole responsibility for the appointment, compensation,
oversight and replacement, if necessary, of the independent
auditor, including the resolution of disagreements between
management and the auditor regarding financial reporting. Each
member of the Committee shall be entitled to rely on
(i) the integrity of those persons and organizations within
and outside the Company that it receives information from and
(ii) the accuracy of the financial and other information
provided to the Committee by such persons or organizations
absent actual knowledge to the contrary (which shall be promptly
reported to the Board of Directors).
5. Duties and Proceedings of the Audit Committee.
The Committee shall assist the Board of Directors in fulfilling
its oversight responsibilities by accomplishing the following:
5.1. Oversight of Independent Auditor.
|
|
|
(a) Annually evaluate, determine the selection of, and if
necessary, determine the replacement of or rotation of, the
independent auditor. |
|
|
(b) Set the independent auditor’s compensation,
oversee the work of the independent auditor and approve or
pre-approve all auditing services (including comfort letters and
statutory audits) and all permitted non-audit services by the
auditor. |
|
|
(c) Review, evaluate and discuss formal reports, at least
annually, from the independent auditor regarding the
auditor’s independence, including a delineation of all
relationships between the auditor and the Company; and recommend
to the Board of Directors actions to satisfy the Board of the
independence of the auditor. |
|
|
(d) Establish hiring policies for employees or former
employees of the independent auditors. |
|
|
(e) At least annually, receive and review a report, orally
or in writing, from the independent auditor detailing the
firm’s internal quality control procedures and any material
issues raised by independent |
12
|
|
|
auditor’s internal quality control review, peer review or
any governmental or other professional inquiry performed within
the past five years and any remedial actions implemented by the
firm. |
5.2. Oversight of Audit Process and Company’s Legal
Compliance Program.
|
|
|
(a) At least annually, review with the independent auditor
the overall scope and plans for audits, including authority and
organizational reporting lines and adequacy of staffing and
compensation. Review with the independent auditor any
difficulties with audits and managements’ response. |
|
|
(b) Review and discuss with management and the independent
auditor the Company’s system of internal control, its
financial and critical accounting practices, and policies
relating to risk assessment and management. |
|
|
(c) Receive and review reports of the independent auditor
discussing (1) all critical accounting policies and
practices used in the preparation of the Company’s
financial statements, (2) all alternative treatments of
financial information within generally accepted accounting
principles (“GAAP”) that have been discussed with
management, ramifications of the use of such alternative
disclosures and treatments, and the treatment preferred by the
independent auditor, and (3) other material written
communications between the independent auditor and management,
such as any management letter or schedule of unadjusted
differences. |
|
|
(d) Discuss with management and the independent auditor any
changes in Company’s critical accounting principles and the
effects of alternative GAAP methods, off-balance sheet
structures and regulatory and accounting initiatives. |
|
|
(e) Review and discuss with management and the independent
auditor: the annual and quarterly financial statements of the
Company and the Company’s disclosures under
“Management’s Discussion and Analysis of Financial
Condition and Results of Operations”, any material changes
in accounting principles or practices used in preparing the
financial statements prior to filing of a report on
Form 10-K or 10-Q with the SEC, and the items required by
Statement of Auditing Standards 61 as in effect at that time in
the case of the annual statements and Statement of Auditing
Standards 100 as in effect at that time in the case of quarterly
statements. |
|
|
(f) Recommend to the Board whether the financial statements
should be included in the annual report on Form 10-K. |
|
|
(g) Review, or establish standards for the type of
information and the type of presentation of such information to
be included in, earnings press releases and earnings guidance
provided to analysts and rating agencies. |
|
|
(h) Review and discuss with management and the independent
auditor pending legal proceedings and other contingent
liabilities which may be material to the Company and review
major legislative and regulatory developments which could
materially impact the Company’s contingent liabilities and
risks. |
|
|
(i) Receive from the CEO and CFO a report of all
significant deficiencies and material weaknesses in the design
or operation of internal controls, and any fraud that involves
management or other employees who have a significant role in the
company’s internal controls. |
|
|
(j) Establish procedures for the receipt, retention and
treatment of complaints received by the Company regarding
accounting, internal accounting controls or auditing matters,
and the confidential, anonymous submissions by employees of
concerns regarding questionable accounting or accounting matters. |
5.3. Other Responsibilities.
|
|
|
(a) Review the adequacy of this audit committee charter
annually and submit charter to Board of Directors for approval. |
|
|
(b) Prepare report for inclusion in the Company’s
annual proxy statement as required by the rules of the
Securities and Exchange Commission. |
13
|
|
|
(c) Put in place an appropriate control process for
reviewing and approving Company’s internal transactions and
accounting. |
|
|
(d) Report to the Board on a regular basis. |
|
|
(e) Annually perform, or participate in, an evaluation of
the performance of the Committee, the results of which shall be
presented to the Board. |
|
|
(f) Perform any other activities consistent with the
Charter, By-laws and governing law as the Board or the Audit
Committee shall deem appropriate, including holding meetings
with the Company’s investment bankers and financial
analysts. |
6. Authority and Resources of the Audit Committee.
The Committee has the authority to retain legal, accounting or
other experts that it determines to be necessary to carry out
its duties. It also has the authority to determine compensation
levels for such advisors as well as for the independent auditor.
The Committee may determine appropriate funding needs for its
own ordinary administrative expenses that are necessary and
appropriate to carry out its duties.
14
BTU-PS-05
BTU INTERNATIONAL, INC.
C/O EQUISERVE TRUST
COMPANY, N.A.
P.O. BOX 8694
EDISON, NJ 08818-8694
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DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
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ZBTU21 |
x |
Please mark votes as in this example. |
|
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#BTU |
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PLEASE DO NOT FOLD THIS PROXY.
1. |
To fix the number of Directors for
the ensuing year at (6) and to elect
the following (6) Directors. |
|
|
|
Nominees:
|
|
(01) Paul J. van der Wansem, (02) G. Mead Wyman,
(03) J. Chuan Chu, (04) John E. Beard,
(05) Joseph F. Wrinn and (06) J. Samuel Parkhill |
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FOR
ALL
NOMINEES
|
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o
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o
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WITHHELD
FROM ALL
NOMINEES |
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o |
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For all nominees except as noted above |
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MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
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o |
Please sign exactly as name(s) appear
hereon. When signing as attorney,
executor, administrator, trustee, or
guardian, please sign your full title as
such. Each joint owner should sign.
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Signature: |
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Date: |
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Signature: |
|
Date: |
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PROXY
ANNUAL MEETING OF BTU INTERNATIONAL, INC.
MAY 26, 2005
The undersigned hereby constitutes and appoints Paul J. van der Wansem and Thomas P. Kealy,
or either of them with full power of substitution to each, proxies to vote and act at the Annual
Meeting of Stockholders on May 26, 2005 at 10:00 a.m., and at any adjournments thereof, upon and
with respect to the number of shares of Common Stock of the company as to which the undersigned
may be entitled to vote or act. The undersigned instructs such proxies, or their substitutes, to
vote in such manner as they may determine on any matters which may come before the meeting, all as
indicated in the accompanying Notice of Meeting and Proxy Statement, receipt of which is
acknowledged, and to vote on the following as specified by the undersigned. All proxies heretofore
given by the undersigned in respect of said meeting are hereby revoked.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. Unless otherwise specified in
the boxes provided on the reverse side hereof, the proxy will be voted IN FAVOR of all nominees
for director and in the discretion of the named proxies as to any other matter that may come
before this meeting or any adjournment thereof.
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SEE REVERSE SIDE
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CONTINUED AND TO BE SIGNED ON REVERSE SIDE
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|
SEE REVERSE SIDE |