SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No.___)
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Filed by the Registrant
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Filed by a Party other than the Registrant
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to § 240.14a-12
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ABAXIS, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
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Payment of Filing Fee (Check the appropriate box)
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No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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Aggregate number of securities to which transaction applies:
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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
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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.
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September 17, 2009
Dear Shareholder:
This years annual meeting of shareholders will be held on
Wednesday, October 28, 2009, at
10:00 a.m. Pacific time, at our offices, located at
3240 Whipple Road, Union City, California. You are cordially
invited to attend.
The Notice of Annual Meeting of Shareholders and a Proxy
Statement, which describe the formal business to be conducted at
the meeting, follow this letter.
It is important that you use this opportunity to take part in
the affairs of Abaxis, Inc. by voting on the business to come
before this meeting. After reading the Proxy Statement, please
promptly mark, sign, date and return the enclosed proxy card in
the prepaid envelope to assure that your shares will be
represented. Regardless of the number of shares you own, your
careful consideration of, and vote on, the matters before our
shareholders is important.
A copy of Abaxis Annual Report to Shareholders is also
enclosed for your information. At the annual meeting we will
review Abaxis activities over the past year and our plans
for the future. We look forward to seeing you at the annual
meeting.
Sincerely yours,
CLINTON H. SEVERSON
Chairman of the Board, President and
Chief Executive Officer
ABAXIS,
INC.
3240 Whipple Road, Union City,
California 94587
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS
To Be Held On October 28,
2009
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of
Shareholders of Abaxis, Inc., a California corporation (the
Company). The meeting will be held on Wednesday,
October 28, 2009, at 10:00 a.m. local time at our
offices, located at 3240 Whipple Road, Union City, California
94587, for the following purposes:
1.
To elect our five nominees for director to serve
for the ensuing year and until their successors are elected and
qualified.
2.
To ratify the selection by the Audit Committee of
the Board of Directors of Burr, Pilger & Mayer LLP as
the Companys independent registered public accounting firm
for the fiscal year ending March 31, 2010.
3.
To conduct any other business properly brought
before the meeting.
These items of business are more fully described in the Proxy
Statement accompanying this Notice.
The record date for the Annual Meeting is August 31, 2009.
Only shareholders of record at the close of business on that
date may vote at the meeting or any adjournment thereof. For ten
days prior to the meeting, a complete list of shareholders
entitled to vote at the meeting will be available for
examination by any shareholder, for any purpose relating to the
meeting, during ordinary business hours at our offices located
at 3240 Whipple Road, Union City, California.
Important Notice Regarding the Availability of Proxy
Materials for the Shareholders Meeting to Be Held on
Wednesday, October 28, 2009, at 10:00 a.m. local time
at our offices, located at
3240 Whipple Road, Union City, California 94587.
The proxy statement and annual report to shareholders
are available at
http://investor.abaxis.com/.
By Order of the Board of Directors
ALBERTO R. SANTA INES
Secretary
Union City, California
September 17, 2009
You are cordially invited to attend the meeting in person.
Whether or not you expect to attend the meeting, please
complete, date, sign and return the enclosed proxy, or vote over
the telephone or the Internet as instructed in these materials,
as promptly as possible in order to ensure your representation
at the meeting. A return envelope (which is postage prepaid if
mailed in the United States) is enclosed for your convenience.
Even if you have voted by proxy, you may still vote in person if
you attend the meeting. Please note, however, that if your
shares are held of record by a broker, bank or other nominee and
you wish to vote at the meeting, you must obtain a proxy issued
in your name from that record holder.
Table of
Contents
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-i-
ABAXIS,
INC.
3240 Whipple Road, Union City,
California 94587
PROXY
STATEMENT
FOR THE 2009 ANNUAL MEETING OF SHAREHOLDERS
October 28, 2009
QUESTIONS
AND ANSWERS ABOUT THIS PROXY MATERIAL AND VOTING
Why am I
receiving these materials?
We have sent you this proxy statement and the enclosed proxy
card because the Board of Directors of Abaxis, Inc., a
California corporation (referred to as the Company
or Abaxis), is soliciting your proxy to vote at the
2009 Annual Meeting of Shareholders, including at any
adjournments or postponements of the meeting. You are invited to
attend the annual meeting to vote on the proposals described in
this proxy statement. However, you do not need to attend the
meeting to vote your shares. Instead, you may simply complete,
sign and return the enclosed proxy card, or follow the
instructions below to submit your proxy over the telephone or on
the Internet.
The Company intends to mail this proxy statement and
accompanying proxy card on or about September 17, 2009 to
all shareholders of record entitled to vote at the annual
meeting.
How do I
attend the annual meeting?
The meeting will be held on Wednesday, October 28, 2009, at
10:00 a.m. local time at our offices, located at 3240
Whipple Road, Union City, California 94587. Directions to the
annual meeting may be found at www.abaxis.com. Information on
how to vote in person at the annual meeting is discussed below.
Who can
vote at the annual meeting?
Only shareholders of record at the close of business on
August 31, 2009 will be entitled to vote at the annual
meeting. On this record date, there were 22,013,876 shares
of common stock outstanding and entitled to vote.
Shareholder
of Record: Shares Registered in Your Name
If on August 31, 2009 your shares were registered directly
in your name with Abaxis transfer agent, Computershare
Trust Company, N.A., then you are a shareholder of record.
As a shareholder of record, you may vote in person at the
meeting or vote by proxy. Whether or not you plan to attend the
meeting, we urge you to fill out and return the enclosed proxy
card or vote by proxy over the telephone or on the Internet as
instructed below to ensure your vote is counted.
Beneficial
Owner: Shares Registered in the Name of a Broker or
Bank
If on August 31, 2009 your shares were held, not in your
name, but rather in an account at a brokerage firm, bank,
dealer, or other similar organization, then you are the
beneficial owner of shares held in street name and
these proxy materials are being forwarded to you by that
organization. The organization holding your account is
considered to be the shareholder of record for purposes of
voting at the annual meeting. As a beneficial owner, you have
the right to direct your broker or other agent regarding how to
vote the shares in your account. You are also invited to attend
the annual meeting. However, since you are not the shareholder
of record, you may not vote your shares in person at the meeting
unless you request and obtain a valid proxy from your broker or
other agent.
What am I
voting on?
There are two matters scheduled for a vote:
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Election of five directors; and
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Ratification of Burr, Pilger & Mayer LLP as our
independent registered public accounting firm for the fiscal
year ending March 31, 2010.
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What if
another matter is properly brought before the meeting?
The Board of Directors knows of no other matters that will be
presented for consideration at the annual meeting. If any other
matters are properly brought before the meeting, it is the
intention of the persons named in the accompanying proxy to vote
on those matters in accordance with their best judgment.
How do I
vote?
You may either vote For all the nominees to the
Board of Directors or you may Withhold your vote for
any nominee you specify. For any other matters to be voted on,
you may vote For or Against or abstain
from voting. The procedures for voting are as follows:
Shareholder
of Record: Shares Registered in Your Name
If you are a shareholder of record, you may vote in person at
the annual meeting, vote by proxy using the enclosed proxy card,
vote by proxy over the telephone, or vote by proxy on the
Internet. Whether or not you plan to attend the meeting, we urge
you to vote by proxy to ensure your vote is counted. You may
still attend the meeting and vote in person even if you have
already voted by proxy.
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To vote in person, come to the annual meeting and we will give
you a ballot when you arrive.
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To vote using the proxy card, simply complete, sign and date the
enclosed proxy card and return it promptly in the envelope
provided. If you return your signed proxy card to us before the
annual meeting, we will vote your shares as you direct.
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To vote over the telephone, dial toll-free
1-800-652-VOTE,
(1-800-652-8683)
using a touch-tone phone and follow the recorded instructions.
You will be asked to provide the company number and control
number from the enclosed proxy card. Your vote must be received
by 1:00 a.m., Central time on October 28, 2009 to be
counted.
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To vote on the Internet, go to
http://www.investorvote.com/ABAX
to complete an electronic proxy card. You will be asked to
provide the company number and control number from the enclosed
proxy card. Your vote must be received by 1:00 a.m.,
Central time on October 28, 2009 to be counted.
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Beneficial
Owner: Shares Registered in the Name of Broker or
Bank
If you are a beneficial owner of shares registered in the name
of your broker, bank, or other agent, you should have received a
proxy card and voting instructions with these proxy materials
from that organization rather than from Abaxis. Simply complete
and mail the proxy card to ensure that your vote is counted.
Alternatively, you may vote by telephone or over the Internet if
instructed by your broker or bank. To vote in person at the
annual meeting, you must obtain a valid proxy from your broker,
bank or other agent. Follow the instructions from your broker or
bank included with these proxy materials, or contact your broker
or bank to request a proxy form.
We provide Internet proxy voting to allow you to vote your
shares online, with procedures designed to ensure the
authenticity and correctness of your proxy vote instructions.
However, please be aware that you must bear any costs associated
with your Internet access, such as usage charges from Internet
access providers and telephone companies.
How many
votes do I have?
On each matter to be voted upon other than the election of
directors, you have one vote for each share of common stock you
own as of August 31, 2009. For the election of directors,
cumulative voting is available. Under cumulative voting, you
would have five votes for each share of common stock you own.
You may cast all of your votes for one candidate, or you may
distribute your votes among different candidates as you choose.
However, you may cumulate votes (cast more than one vote per
share) for a candidate only if the candidate is nominated before
the voting and at least one shareholder gives notice at the
meeting, before the voting, that he or she intends to cumulate
votes. If you do not specify how to distribute your votes, by
giving your proxy you are authorizing the proxyholders (the
individuals named on your proxy card) to cumulate votes in their
discretion.
2
What if I
return a proxy card but do not make specific choices?
If you return a signed and dated proxy card without marking any
voting selections, your shares will be voted For the
election of all five nominees for director and For
the ratification of the appointment of Burr, Pilger &
Mayer LLP as independent registered public accounting firm of
the Company for its fiscal year ending March 31, 2010. If
any other matter is properly presented at the meeting, your
proxyholder (one of the individuals named on your proxy card)
will vote your shares using his or her best judgment.
Who is
paying for this proxy solicitation?
We will pay for the entire cost of soliciting proxies, including
the preparation, assembly, printing and mailing of the proxy
materials and any additional solicitation materials furnished to
the shareholders. In addition to these mailed proxy materials,
our directors and employees may also solicit proxies in person,
by telephone, or by other means of communication. Directors and
employees will not be paid any additional compensation for
soliciting proxies. We have not engaged any third party to
assist us in solicitation of proxies. We may also reimburse
brokerage firms, banks and other agents for the cost of
forwarding proxy materials to beneficial owners.
What does
it mean if I receive more than one set of proxy
materials?
If you receive more than one set of proxy materials, your shares
may be registered in more than one name or in different
accounts. Please follow the voting instructions on each of the
proxy cards in the proxy materials to ensure that all of your
shares are voted.
Can I
change my vote after submitting my proxy?
Yes. You can revoke your proxy at any time before the final vote
at the meeting. If you are the record holder of your shares, you
may revoke your proxy in any one of three ways:
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You may submit another properly completed proxy card with a
later date.
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You may send a timely written notice that you are revoking your
proxy to Abaxis Secretary at 3240 Whipple Road,
Union City, California 94587.
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You may attend the annual meeting and vote in person. Simply
attending the meeting will not, by itself, revoke your proxy.
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If your shares are held by your broker or bank as a nominee or
agent, you should follow the instructions provided by your
broker or bank.
When are
shareholder proposals due for next years annual
meeting?
To be considered for inclusion in next years proxy
materials, your proposal must be submitted in writing by
May 20, 2010, the date not less than one hundred twenty
(120) days prior to the one year anniversary of our mailing
to shareholders of this Proxy Statement for the 2009 Annual
Meeting of Shareholders, to Abaxis Secretary at
3240 Whipple Road, Union City, California 94587. If you
wish to bring a matter before the shareholders at next
years annual meeting and you do not notify Abaxis before
August 1, 2010, for all proxies we receive, the
proxyholders will have discretionary authority to vote on the
matter, including discretionary authority to vote in opposition
to the matter.
How are
votes counted?
Votes will be counted by the inspector of election appointed for
the meeting, who will separately count For and
Withhold and, with respect to proposals other than
the election of directors, Against votes,
abstentions and broker non-votes. Although abstentions and
broker non-votes are counted as present for purposes of a
quorum, they are not counted as affirmative votes for the
proposals. For Proposal 2, abstentions and broker non-votes
will have no effect except to the extent the number of
abstentions and broker non-votes causes the number of shares
voted in favor of Proposal 2 not to equal or exceed a
majority of the quorum required for the meeting.
3
What are
broker non-votes?
Broker non-votes occur when a beneficial owner of shares held in
street name does not give instructions to the broker
or nominee holding the shares as to how to vote on matters
deemed non-routine. Generally, if shares are held in
street name, the beneficial owner of the shares is entitled to
give voting instructions to the broker or nominee holding the
shares. If the beneficial owner does not provide voting
instructions, the broker or nominee can still vote the shares
with respect to matters that are considered to be
routine, but not with respect to
non-routine matters.
How many
votes are needed to approve each proposal?
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Proposal No. 1:
Election of
Directors. For the election of directors, the five nominees
receiving the most For votes (from the holders of
votes of shares present in person or represented by proxy and
entitled to vote on the election of directors) will be elected.
Only votes For or Withheld will affect
the outcome.
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Proposal No. 2:
Ratification of
Selection of Independent Registered Public Accounting Firm. To
be approved, Proposal No. 2 ratifying the selection by
the Audit Committee of the Board of Directors of Burr,
Pilger & Mayer LLP as independent registered public
accounting firm for the fiscal year ending March 31, 2010
must receive For votes from the holders of a
majority of shares present either in person or by proxy and
voting, provided that the votes in favor of each of
Proposal No. 2 are a majority of the votes that
constitute the required quorum. Abstentions and broker non-votes
will not be counted towards the vote total.
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What is
the quorum requirement?
A quorum of shareholders is necessary to hold a valid meeting. A
quorum will be present if shareholders holding at least a
majority of the outstanding shares entitled to vote are present
at the meeting in person or represented by proxy. On the record
date, there were 22,013,876 shares outstanding and entitled
to vote. Thus, the holders of 11,006,939 shares must be
present in person or represented by proxy at the meeting or by
proxy to have a quorum.
Votes for and against, abstentions and broker
non-votes will each be counted as present for the purposes
of determining the presence of a quorum. Your shares will be
counted towards the quorum only if you submit a valid proxy (or
one is submitted on your behalf by your broker, bank or other
nominee) or if you vote in person at the meeting. If there is no
quorum, the holders of a majority of shares present at the
meeting in person or represented by proxy may adjourn the
meeting to another date.
How can I
find out the results of the voting at the annual
meeting?
Preliminary voting results will be announced at the annual
meeting. Final voting results will be published in the
Companys quarterly report on
Form 10-Q
for the third quarter of fiscal 2010.
What
proxy materials are available on the internet?
The proxy statement and annual report to shareholders are
available at
http://investor.abaxis.com.
4
The authorized number of directors constituting the
Companys Board of Directors is five. There are five
nominees for director this year due to the recent resignation of
one of the Companys directors, Brenton G.A. Hanlon. Each
director to be elected for the ensuing year will hold office
until the next annual meeting of shareholders and until his or
her successor is elected and qualified, or, if sooner, until the
directors death, resignation or removal. Proxies cannot be
voted for a greater number of persons than the five nominees
named in this Proposal 1. Each of the nominees listed below
is currently a director of the Company who was previously
elected by the shareholders. It is the Companys policy to
strongly encourage nominees for directors to attend the Annual
Meeting. All of the Companys directors, as well as
Mr. Hanlon, attended the 2008 Annual Meeting of
Shareholders.
The candidates receiving the highest number of affirmative votes
by the holders of shares entitled to be voted will be elected.
The persons named in the accompanying proxy will vote the shares
represented thereby for the nominees named below, but may
cumulate the votes for less than all of the nominees, as
permitted by the laws of the State of California, unless
otherwise instructed. If any nominee becomes unavailable for
election as a result of an unexpected occurrence, your shares
will be voted for the election of a substitute nominee proposed
by Abaxis. Each person nominated for election has agreed to
serve if elected. The Companys management has no reason to
believe that any nominee will be unable to serve.
NOMINEES
The nominees for election to the Board of Directors at the 2009
Annual Meeting are Clinton H. Severson, Richard J.
Bastiani, Ph.D., Henk J. Evenhuis, Prithipal
Singh, Ph.D. and Ernest S. Tucker, III, M.D.
Please see Directors and Executive Officers of the
Registrant below for information concerning the nominees.
VOTE
REQUIRED AND RECOMMENDATION OF THE BOARD OF DIRECTORS
Although abstentions and broker non-votes will each
be counted as present for purposes of determining a quorum,
neither abstentions nor broker non-votes will have
any impact on the election of directors and the five candidates
for election as directors at the annual meeting who receive the
highest number of affirmative votes will be elected.
If the nominees decline to serve or become unavailable for any
reason, or if a vacancy occurs before the election (although
management knows of no reason to anticipate that this will
occur), the proxies may be voted for substitute nominees as the
Board of Directors may designate. In the event that additional
persons are nominated for election as directors, the proxy
holders intend to vote all proxies received by them in such a
manner in accordance with cumulative voting as will ensure the
election of as many of the nominees listed below as possible,
and, in such event, the specific nominees to be voted for will
be determined by the proxy holders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
FOR THE NOMINEES NAMED ABOVE.
5
DIRECTORS
AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following table sets forth certain information concerning
the Companys directors and executive officers:
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Name
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Age
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Title
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Clinton H. Severson
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61
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Chairman of the Board, President and Chief Executive Officer
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Richard J. Bastiani, Ph.D.(1)(2)(3)
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Director
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Henk J. Evenhuis(1)(2)
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Director
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Prithipal Singh, Ph.D.(1)(2)
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70
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Director
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Ernest S. Tucker, III, M.D.(1)(2)
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Director
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Alberto R. Santa Ines
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Chief Financial Officer and Vice President of Finance
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Kenneth P. Aron, Ph.D.
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Chief Technology Officer
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Donald P. Wood
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Chief Operations Officer
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Vladimir E. Ostoich, Ph.D.
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64
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Vice President of Government Affairs and Vice President of
Marketing for the Pacific Rim, Founder
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Martin V. Mulroy
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48
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Vice President of Veterinary Sales and Marketing for North
America
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Brenton G.A. Hanlon(4)
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63
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Vice President of North American Medical Sales and Marketing
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(1)
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Member of the Audit Committee
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(2)
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Member of the Nominating and Corporate Governance Committee
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(3)
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Member of the Compensation Committee
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(4)
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Mr. Hanlon resigned from the Board of Directors and each
committee of the Board of Directors as of August 10, 2009,
and was appointed as Vice President of North American Medical
Sales and Marketing in September 2009.
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Clinton H. Severson
has served as the Companys
President, Chief Executive Officer and one of our directors
since June 1996. He was appointed Chairman of the Board in May
1998. Since November 2008, Mr. Severson served on the Board
of Directors of Trinity Biotech (Nasdaq: TRIB), a biotechnology
company. Since November 2006, Mr. Severson served on the
Board of Directors of CytoCore, Inc. (OTCBB: CYOE.OB), a
biotechnology company. From February 1989 to May 1996,
Mr. Severson served as President and Chief Executive
Officer of MAST Immunosystems, Inc., a privately-held medical
diagnostic company.
Richard J. Bastiani, Ph.D.
joined the Board of
Directors in September 1995. Dr. Bastiani is currently
retired and serves as Chairman of the Board of Directors of
Response Biomedical Corporation (CDNX: RBM). From 1998 to 2005,
Dr. Bastiani served as Chairman of the Board of Directors
of ID Biomedical Corporation (Nasdaq: IDBE), after he was
appointed to the Board of Directors of ID Biomedical Corporation
in October 1996. Dr. Bastiani was President of Dendreon
(Nasdaq: DNDN), a biotechnology company, from September 1995 to
September 1998. From 1971 until 1995, Dr. Bastiani held a
number of positions with Syva Company, a diagnostic company,
including as President from 1991 until Syva was acquired by a
subsidiary of Hoechst AG of Germany in 1995. Dr. Bastiani
is also a member of the board of directors of three
privately-held companies.
Henk J. Evenhuis
joined the Board of Directors in
November 2002. Mr. Evenhuis is currently retired. He served
on the Board of Directors of Credence Systems Corporation
(Nasdaq: CMOS), a semiconductor equipment manufacturer from 1993
to 2008. Mr. Evenhuis served as Executive Vice President
and Chief Financial Officer of Fair Isaac Corporation (NYSE:
FIC), a global provider of analytic software products to the
financial services, insurance and health care industries from
October 1999 to October 2002. From 1987 to 1998, he was
Executive Vice President and Chief Financial Officer of Lam
Research Corporation (Nasdaq: LRCX), a semiconductor equipment
manufacturer.
6
Prithipal Singh, Ph.D.
joined the Board of Directors
in June 1992. Prior to retiring, Dr. Singh was the Founder,
Chairman and Chief Executive Officer of ChemTrak Inc. (Pink
Sheets: CMTR) from 1988 to 1998. Prior to this, Dr. Singh
was an Executive Vice President of Idetec Corporation from 1985
to 1988 and a Vice President of Syva Corporation from 1977 to
1985.
Ernest S. Tucker, III, M.D.
joined the Board of
Directors in September 1995. Dr. Tucker currently serves as
a self-employed healthcare consultant after having retired as
Chief Compliance Officer for Scripps Health in San Diego in
September 2000, a position which he assumed in April 1998.
Dr. Tucker was Chairman of Pathology at Scripps Clinic and
Research Foundation from 1992 to 1998 and Chair of Pathology at
California Pacific Medical Center in San Francisco from
1989 to 1992.
Alberto R. Santa Ines
has served as the Companys
Chief Financial Officer and Vice President of Finance since
April 2002. Mr. Santa Ines joined us in February 2000 as
Finance Manager. In April 2001, Mr. Santa Ines was promoted
to Interim Chief Financial Officer and Director of Finance, and
in April 2002 he was promoted to his current position. From
March 1998 to January 2000, Mr. Santa Ines was a
self-employed consultant to several companies. From August 1997
to March 1998, Mr. Santa Ines was the Controller of Unisil
(Pink Sheets: USIL), a semiconductor company. From April 1994 to
August 1997, he was a Senior Finance Manager at Lam Research
Corporation (Nasdaq: LRCX), a semiconductor equipment
manufacturer.
Kenneth P. Aron, Ph.D.
has served as the
Companys Chief Technology Officer since April 2008.
Dr. Aron joined us in February 2000 as Vice President of
Research and Development. From April 1998 to November 1999,
Dr. Aron was Vice President of Engineering and Technology
of Incyte Pharmaceuticals (Nasdaq: INCY), a genomic information
company. From April 1996 to April 1998, Dr. Aron was Vice
President of Research, Development and Engineering for
Cardiogenesis Corporation (Nasdaq: CGCP), a manufacturer of
laser-based cardiology surgical products.
Donald P. Wood
has served as the Companys Chief
Operations Officer since April 2009. Mr. Wood joined us in
October 2007 as Vice President of Operations. From April 2003 to
September 2007, Mr. Wood was the Vice President of
Operations of Cholestech Corporation (Nasdaq: CTEC), a medical
products manufacturing company which was subsequently acquired
by Inverness Medical Innovations, Inc. in September 2007. From
July 2001 to March 2003, Mr. Wood served as Vice President
of Bone Health, a business unit of Quidel Corporation, a
manufacturing and marketer of
point-of-care
diagnostics, and was responsible for Bone Health Product
Operations, Device Research and Development, and Sales and
Marketing. He also served as Quidels Vice President of
Ultrasound Operations from August 1999 to July 2001. Prior to
joining Quidel, Mr. Wood was the Director of Ultrasound
Operations for Metra Biosystems Inc., a developer and
manufacturing company of
point-of-care
products for osteoporosis, from July 1998 to August 1999 prior
to Quidels acquisition of Metra Biosystems Inc.
Vladimir E. Ostoich, Ph.D.,
one of the
Companys co-founders, is currently the Vice President of
Government Affairs and Vice President of Marketing for the
Pacific Rim. Dr. Ostoich has served as Vice President in
various capacities at Abaxis since inception, including as Vice
President of Research and Development, Senior Vice President of
Research and Development, Vice President of Engineering and
Instrument Manufacturing and Vice President of Marketing and
Sales for the United States and Canada.
Martin V. Mulroy
has served as the Companys Vice
President of Veterinary Sales and Marketing for
North America since May 2006. Mr. Mulroy joined us in
November 1997 as the Northeast Regional Sales Manager. He was
promoted to Eastern Area Director of Sales in December 1998 and,
in January 2005, he was promoted to National Sales Director for
the Domestic Veterinary market. From March 1996 to November
1997, Mr. Mulroy was Regional Sales Manager for BioCircuits
Inc., an immunoassay company in the medical market.
Mr. Mulroy was Regional Sales Manager from 1990 to 1992 and
Field Operations Manager from 1992 to 1995 for MAST
Immunosystems Inc., a privately-held medical diagnostic company.
Brenton G. A. Hanlon
has served as the Companys
Vice President of North American Medical Sales and Marketing
since September 2009. Mr. Hanlon served on our Board of
Directors from November 1996 through August 2009. From January
2001 to August 2009, Mr. Hanlon was President and Chief
Executive Officer of Hitachi Chemical Diagnostics, a
manufacturer of in vitro allergy diagnostic products.
Concurrently, from December 1996 to August 2009, Mr. Hanlon
was also President and Chief Operating Officer of Tri-Continent
Scientific, a subsidiary
7
of Hitachi Chemical, specializing in liquid-handling products
and instrument components for the medical diagnostics and
biotechnology industries. From 1989 to December 1996,
Mr. Hanlon was Vice President and General Manager of
Tri-Continent Scientific. Mr. Hanlon serves on the board of
directors of two privately-held companies.
INFORMATION
REGARDING THE BOARD OF DIRECTORS AND CORPORATE
GOVERNANCE
INDEPENDENCE
OF THE BOARD OF DIRECTORS
As required under The Nasdaq Stock Market (Nasdaq)
listing standards, a majority of the members of a listed
companys Board of Directors must qualify as
independent, as affirmatively determined by the
Board of Directors. The Board consults with the Companys
counsel to ensure that the Boards determinations are
consistent with relevant securities and other laws and
regulations regarding the definition of independent,
including those set forth in pertinent listing standards of the
Nasdaq, as in effect from time to time.
Consistent with these considerations, after review of all
relevant transactions or relationships between each director, or
any of his or her family members, and the Company, its senior
management and its independent auditors, the Board has
affirmatively determined that each of the following directors
are independent directors within the meaning of the applicable
Nasdaq listing standards: Mr. Evenhuis, Dr. Bastiani,
Dr. Singh and Dr. Tucker. In addition, the Board
previously determined that Mr. Hanlon, who resigned from
the Board of Directors as of August 10, 2009, was an
independent director within the meaning of the applicable Nasdaq
listing standards prior to such resignation. In making this
determination, the Board found that none of these current or
former directors or nominees for director had a material or
other disqualifying relationship with the Company.
Mr. Severson, the Companys President and Chief
Executive Officer, is not an independent director by virtue of
his employment with the Company. There are no family
relationships among any of the Companys directors or
officers.
MEETINGS
OF THE BOARD OF DIRECTORS
The Board of Directors met five times during the fiscal year
ended March 31, 2009. Each Board member attended 75% or
more of the aggregate of the meetings of the Board and of the
committees on which he served, held during the period for which
he was a director or committee member.
As required under applicable Nasdaq listing standards, in fiscal
2009, the Companys independent directors met four times in
regularly scheduled executive sessions at which only independent
directors were present.
INFORMATION
REGARDING COMMITTEES OF THE BOARD OF DIRECTORS
The Board has three committees: an Audit Committee, a
Compensation Committee and a Nominating and Corporate Governance
Committee. The following table provides membership and meeting
information for fiscal 2009 for each of the Board committees:
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Nominating and
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Corporate
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Name
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Audit
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Compensation
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Governance
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Clinton H. Severson
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Richard J. Bastiani, Ph.D.
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X
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X
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*
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X
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Henk J. Evenhuis
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X
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*
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X
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Brenton G. A. Hanlon
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X
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X
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X
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Prithipal Singh, Ph.D.
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X
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X
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*
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Ernest S. Tucker, III, M.D.
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X
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X
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Total meetings in fiscal 2009
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6
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2
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0
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*
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Committee Chairperson
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Mr. Hanlon resigned from the Board of Directors and each
committee of the Board of Directors as of August 10, 2009.
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8
Below is a description of each committee of the Board of
Directors. The Board of Directors has determined that each
member of each committee meets the applicable Nasdaq rules and
regulations regarding independence and that each
member is free of any relationship that would impair his or her
individual exercise of independent judgment with regard to the
Company.
Audit
Committee
The Audit Committee reviews and monitors the Companys
corporate financial reporting and external audits, including,
among other things, the Companys control functions, the
results and scope of the annual audit and other services
provided by the independent registered public accountants and
the Companys compliance with legal matters that have a
significant impact on its financial reports. Among other things,
the Audit Committee:
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evaluates the performance of and assesses the qualifications of
the independent auditors;
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determines and approves the engagement of the independent
auditors;
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determines whether to retain or terminate the existing
independent auditors or to appoint and engage new independent
auditors;
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reviews and approves the retention of the independent auditors
to perform any proposed permissible non-audit services;
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monitors the rotation of partners of the independent auditors on
the Companys audit engagement team as required by law;
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reviews and approves transactions between the company and any
related persons;
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confers with management and the independent auditors regarding
the effectiveness of internal controls over financial reporting;
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establishes procedures for the receipt, retention and treatment
of complaints received by the Company regarding accounting,
internal accounting controls or auditing matters and the
confidential and anonymous submission by employees of concerns
regarding questionable accounting or auditing matters; and
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meets to review the Companys annual audited financial
statements and quarterly financial statements with management
and the independent auditor, including reviewing the
Companys disclosures under Managements
Discussion and Analysis of Financial Condition and Results of
Operations.
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The Audit Committee is currently composed of four directors:
Mr. Evenhuis, Dr. Bastiani, Dr. Singh and
Dr. Tucker. Mr. Evenhuis serves as Chairman of the
Audit Committee. Mr. Hanlon served as a member of the Audit
Committee until his resignation from the Board of Directors and
each committee of the Board of Directors as of August 10,
2009. The Audit Committee held six meetings during the fiscal
year ended March 31, 2009. For additional information about
the Audit Committee, see Report of the Audit Committee of
the Board of Directors below. The Audit Committee has
adopted a written charter that is available to shareholders in
the Investor Relations section of the Companys website at
http://www.abaxis.com.
The Board of Directors annually reviews the Nasdaq listing
standards definition of independence for Audit Committee members
and has determined that all members of the Audit Committee,
including Mr. Hanlon during the time he served on the Audit
Committee, are independent (as independence is currently defined
in Rule 4350(d)(2)(A)(i) and (ii) of the Nasdaq
listing standards). Securities and Exchange Commission
(SEC) regulations require the Company to disclose
whether a director qualifying as an audit committee
financial expert serves on the Audit Committee. The Board
of Directors has determined that Mr. Evenhuis qualifies as
an audit committee financial expert, as defined in
applicable SEC rules. The Board of Directors made a qualitative
assessment of Mr. Evenhuiss level of knowledge and
experience based on a number of factors, including his formal
education and experience as a chief financial officer for public
reporting companies.
9
Report of
the Audit Committee of the Board of
Directors
1
The Audit Committee oversees Abaxis financial reporting
process on behalf of the Board of Directors. Management has the
primary responsibility for the financial statements and the
reporting process, including internal control systems. In the
fiscal year ended March 31, 2009, Burr, Pilger &
Mayer LLP was responsible for expressing an opinion as to the
conformity of the Companys audited financial statements
with generally accepted accounting principles. Burr,
Pilger & Mayer LLP has acted in such capacity since
its appointment on August 25, 2005.
The Audit Committee has reviewed and discussed the audited
financial statements for the fiscal year ended March 31,
2009 with management of the Company. The Audit Committee has
discussed with the independent registered public accounting firm
the matters required to be discussed by the Statement on
Auditing Standards No. 61, as amended (AICPA, Professional
Standards, Vol. 1. AU section 380), as adopted by the
Public Company Accounting Oversight Board (PCAOB) in
Rule 3200T. The Audit Committee has met with Burr,
Pilger & Mayer LLP, with and without management
present, to discuss the overall scope and results of Burr,
Pilger & Mayer LLPs audit and review procedures,
and the overall quality of its financial reporting. The Audit
Committee has also received the written disclosures and the
letter from the independent registered public accounting firm
required by applicable requirements of the PCAOB regarding the
independent accountants communications with the audit
committee concerning independence, and has discussed with the
independent registered public accounting firm the accounting
firms independence. Based on the review and discussions
referred to above, the Audit Committee has recommended to the
Board of Directors that Abaxis audited financial
statements be included in Abaxis Annual Report on
Form 10-K
for the fiscal year ended March 31, 2009.
THE AUDIT
COMMITTEE
Henk J. Evenhuis, Chairman
Richard J. Bastiani, Ph.D.
Brenton G.A. Hanlon*
Prithipal Singh, Ph.D.
Ernest S. Tucker, III, M.D.
*
Mr. Hanlon resigned
from the Audit Committee as of August 10, 2009.
Compensation
Committee
The Compensation Committee is composed of one director,
Dr. Bastiani. During the fiscal year ended March 31,
2009, and until Mr. Hanlons resignation from the
Board of Directors and each committee of the Board of Directors
as of August 10, 2009, the Compensation Committee was
composed of two directors: Dr. Bastiani and
Mr. Hanlon. Dr. Bastiani, the sole current member of
the Compensation Committee, is a non-employee member of the
Companys Board of Directors and is independent (as
independence is currently defined in Rule 4200(a)(15) of
the Nasdaq listing standards). During the time Mr. Hanlon
served as a member of the Companys Board of Directors,
Mr. Hanlon was a non-employee member of the Companys
Board of Directors and was independent (as independence is
currently defined in Rule 4200(a)(15) of the Nasdaq listing
standards). The Companys Board of Directors intends to
appoint one or more additional independent and non-employee
members of the Board of Directors to the Compensation Committee
in light of the resignation of Mr. Hanlon. The Compensation
Committee held two meetings during the fiscal year ended
March 31, 2009, which were attended by both
Messrs. Bastiani and Hanlon. The Compensation Committee has
adopted a written charter that is available to shareholders in
the Investor Relations section of the Companys website at
http://www.abaxis.com.
For additional information about the Compensation Committee, see
Compensation Committee Report and Executive
Compensation.
1
The
material in this report is not soliciting material,
is not deemed filed with the Securities and Exchange
Commission and is not to be incorporated by reference in any
filing of Abaxis, Inc. under the Securities Act or the Exchange
Act, whether made before or after the date hereof and
irrespective of any general incorporation language in any such
filing.
10
The Compensation Committee reviews and makes recommendations to
the Board of Directors regarding the Companys compensation
strategy, policies, plans and programs and all forms of
compensation to be provided to the Companys executive
officers and directors, including among other things:
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development or review and approval of corporate and individual
performance objectives relevant to the compensation of the
Companys Chief Executive Officer and evaluation of
performance in light of these stated objectives;
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review and approval of the compensation and other terms of
employment or service, including severance and
change-in-control
arrangements, of the Companys Chief Executive Officer and
the other executive officers; and
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development or review and approval of incentive-based or
equity-based compensation plans in which the Companys
executive officers and employees participate.
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The Compensation Committee also reviews with management the
Companys Compensation Discussion and Analysis and
considers whether to recommend that it be included in proxy
statements and other filings.
Compensation
Committee Processes and Procedures
Typically, the Compensation Committee meets at least one time
annually and with greater frequency if necessary. The agenda for
each meeting is usually developed by the Chair of the
Compensation Committee, in consultation with the Chief Executive
Officer. However, Mr. Severson does not participate in the
determination of his own compensation. The charter of the
Compensation Committee grants the Compensation Committee
authority to obtain, at the expense of the Company, advice and
assistance from internal and external legal, accounting or other
advisors and consultants and other external resources that the
Compensation Committee considers necessary or appropriate in the
performance of its duties. In particular, the Compensation
Committee has the sole authority to retain compensation
consultants to assist in its evaluation of executive and
director compensation, including the authority to approve the
consultants reasonable fees and other retention terms. The
Compensation Committee presents its recommendation for executive
compensation to the Board of Directors for final review and
approval. Typically, these recommendations are made to our Board
of Directors during the first quarter of the ensuing fiscal year.
The Compensation Committee does not delegate any of its
functions in determining executive
and/or
director compensation. To date, the Compensation Committee has
not established any formal policies or guidelines for allocating
compensation between long-term and currently paid out
compensation, cash and non-cash compensation, or among different
forms of non-cash compensation. The Compensation Committee may
discuss with the Chief Executive Officer or Chief Financial
Officer the Companys financial, operating and strategic
business objectives, bonus targets or performance goals. The
Compensation Committee reviews and determines the
appropriateness of the financial measures and performance goals,
as well as assesses the degree of difficulty in achieving
specific bonus targets and performance goals. From time to time,
the Compensation Committee may engage an independent
compensation advisor to obtain competitive compensation data.
The specific determinations of the Compensation Committee with
respect to executive compensation for fiscal 2009 are described
in greater detail in the Compensation Discussion and Analysis
section of this proxy statement.
Compensation
Committee Interlocks and Insider Participation
No member of the Compensation Committee has ever been an
executive officer or employee of the Company. None of the
Companys executive officers currently serves, or has
served during the last completed fiscal year, on the
Compensation Committee or board of directors of any other entity
that has one or more executive officers serving as a member of
the Companys board of directors or compensation committee.
For information with respect to related-person transactions
involving members of the Compensation Committee, see
Transactions with Related Persons.
11
Compensation
Committee
Report
2
The Compensation Committee has reviewed and discussed with
management the disclosures contained in the Compensation
Discussion and Analysis (CD&A) contained in
this proxy statement. Based on this review and discussion, the
Compensation Committee has recommended to the Board of Directors
that the CD&A be included in this proxy statement.
THE COMPENSATION COMMITTEE
Richard J. Bastiani, Ph.D., Chair
Brenton G.A. Hanlon*
*
Mr. Hanlon resigned
from the Compensation Committee as of August 10, 2009.
The members of the Nominating and Corporate Governance Committee
are Dr. Bastiani, Mr. Evenhuis, Dr. Singh and
Dr. Tucker. Mr. Hanlon served on the Nominating and
Corporate Governance Committee until his resignation from the
Board of Directors and each committee of the Board of Directors
as of August 10, 2009. Each of the members of the
Nominating and Corporate Governance Committee are independent
(as independence is currently defined in Rule 4200(a)(15)
of the Nasdaq listing standards). Prior to his resignation from
the Board of Directors, Mr. Hanlon was also independent (as
independence is currently defined in Rule 4200(a)(15) of
the Nasdaq listing standards). The Nominating and Corporate
Governance Committee did not hold any meetings during the fiscal
year ended March 31, 2009. The Nominating and Corporate
Governance Committee has adopted a written charter that is
available to shareholders in the Investor Relations section of
the Companys website at
http://www.abaxis.com.
The Nominating and Corporate Governance Committee reviews the
results of the evaluation of the Board of Directors and its
committees, and the needs of the Board of Directors for various
skills, experience, expected contributions and other
characteristics, and the optimal size of the Board in light of
these needs, in determining the director candidates to be
nominated at the annual meeting. The Nominating and Corporate
Governance Committee will evaluate candidates for directors,
including incumbent directors and candidates proposed by
directors, shareholders or management, in light of the
Nominating and Corporate Governance Committees views of
the current needs of the Board of Directors for certain skills,
experience or other characteristics, the candidates
background, skills, experience, other characteristics and
expected contributions and the qualification standards, if any,
established by the Nominating and Corporate Governance
Committee. If the Nominating and Corporate Governance Committee
believes that the Board of Directors requires additional
candidates for nomination, the Nominating and Corporate
Governance Committee may poll existing directors or management
for suggestions for candidates and may engage, as appropriate, a
third party search firm to assist in identifying qualified
candidates. The process may also include interviews and
additional background and reference checks for non-incumbent
nominees, at the discretion of the Nominating and Corporate
Governance Committee. In making the determinations regarding
nominations of directors, the Nominating and Corporate
Governance Committee may take into account the benefits of
diverse viewpoints as well as the benefits of a constructive
working relationship among directors.
The Nominating and Corporate Governance Committee will consider
director nominations made by shareholders in accordance with the
requirements of Abaxis bylaws consistent with these
procedures. Any shareholder entitled to vote in the election of
directors generally may nominate one or more persons for
election as directors at a meeting only if timely notice of such
shareholders intent to make such nomination or nominations
has been given in writing to the secretary of Abaxis. To be
timely, a shareholder nomination for a director to be elected at
an annual meeting shall be received at Abaxis principal
executive offices not less than 120 calendar days in advance of
the date that Abaxis proxy statement was released to
shareholders in connection with the previous years annual
meeting of shareholders, except that if no annual meeting was
held in the previous year or the date of the annual
2
The
material in this report is not soliciting material,
is not deemed filed with the Securities and Exchange
Commission and is not to be incorporated by reference in any
filing of Abaxis, Inc. under the Securities Act or the Exchange
Act, whether made before or after the date hereof and
irrespective of any general incorporation language in any such
filing. Nominating and Corporate Governance Committee
12
meeting has been changed by more than 30 calendar days from the
date contemplated at the time of the previous years proxy
statement, or in the event of a nomination for director to be
elected at a special meeting, notice by the shareholders to be
timely must be received not later than the close of business on
the tenth day following the day on which such notice of the date
of the special meeting was mailed or such public disclosure was
made. Each such notice shall set forth: (a) the name and
address of the shareholder who intends to make the nomination
and of the person or persons to be nominated; (b) a
representation that the shareholder is a holder of record of
stock of Abaxis entitled to vote for the election of directors
on the date of such notice and intends to appear in person or by
proxy at the meeting to nominate the person or persons specified
in the notice; (c) a description of all arrangements or
understandings between the shareholder and each nominee and any
other person or persons (naming such person or persons) pursuant
to which the nomination or nominations are to be made by the
shareholder; (d) such other information regarding each
nominee proposed by such shareholder as would be required to be
included in a proxy statement filed pursuant to the proxy rules
of the SEC, had the nominee been nominated, or intended to be
nominated, by the board of directors; and (e) the consent
of each nominee to serve as a director of Abaxis if so elected.
Other than the foregoing, there are no stated minimum criteria
for director nominees, although the Nominating and Corporate
Governance Committee may also consider such other factors as it
may deem to be in the best interests of Abaxis and its
shareholders.
SHAREHOLDER
COMMUNICATIONS WITH THE BOARD OF DIRECTORS
Shareholders may communicate with the Board or any of our
directors by transmitting correspondence by mail, facsimile or
email, addressed as follows:
Chairman of the Board
or Board of Directors
or any individual director
c/o Mr. Alberto
R. Santa Ines, Chief Financial Officer and Secretary
3240 Whipple Road
Union City, CA 94587
Fax:
510-441-6151
or
Email Address:
investors@abaxis.com
The Compliance Officer shall maintain a log of such
communications and transmit as soon as practicable such
communications to the identified director addressee(s), unless
there are safety or security concerns that mitigate against
further transmission of the communication, as determined by the
Compliance Officer in consultation with Abaxis legal
counsel. The Board of Directors or individual directors so
addressed shall be advised of any communication withheld for
safety or security reasons as soon as practicable. The
Compliance Officer shall relay all communications to directors
absent safety or security issues.
CODE OF
BUSINESS CONDUCT AND ETHICS
The Company has adopted the Abaxis, Inc. Code of Business
Conduct and Ethics that applies to all of the Companys
executive officers, directors and employees, including without
limitation the Companys principal executive officer,
principal financial officer, principal accounting officer or
controller or persons performing similar functions. The Code of
Business Conduct and Ethics is available on our website at
www.abaxis.com under Investor Relations at
Corporate Governance. If the Company makes any
substantive amendments to the Code of Business Conduct and
Ethics or grants any waiver from a provision of the Code of
Business Conduct and Ethics to any executive officer or
director, the Company will promptly disclose the nature of the
amendment or waiver on its website. The Company intends to
satisfy the disclosure requirement under Item 5.05 of
Form 8-K
regarding any amendment to, or waiver of, any provision of the
Code of Business Conduct and Ethics by disclosing such
information on the same website.
13
PROPOSAL 2
RATIFICATION
OF SELECTION OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee of the Board of Directors has selected Burr,
Pilger & Mayer LLP as the Companys independent
registered public accounting firm for the fiscal year ending
March 31, 2010 and has further directed that management
submit the selection for ratification by the shareholders at the
Annual Meeting. Burr, Pilger & Mayer LLP has audited
the Companys financial statements since its appointment on
August 25, 2005. A representative of Burr,
Pilger & Mayer LLP is expected to be present at the
Annual Meeting, with the opportunity to make a statement if the
representative desires to do so, and is expected to be available
to respond to appropriate questions.
Neither the Companys Bylaws nor other governing documents
or law require shareholder ratification of the selection of
Burr, Pilger & Mayer LLP as the Companys
independent registered public accounting firm. However, the
Audit Committee of the Board of Directors is submitting the
selection of Burr, Pilger & Mayer LLP to the
shareholders for ratification as a matter of good corporate
practice. If the shareholders fail to ratify the selection, the
Audit Committee of the Board of Directors will reconsider
whether or not to retain that firm. Even if the selection is
ratified, the Audit Committee of the Board of Directors in its
discretion may direct the appointment of a different independent
registered public accounting firm at any time during the year if
they determine that such a change would be in the best interests
of the Company and its shareholders.
PRINCIPAL
ACCOUNTANT FEES AND SERVICES
For the fiscal years ended March 31, 2009 and 2008, our
independent registered public accounting firm, Burr,
Pilger & Mayer LLP billed the approximate fees set
forth below. All fees included below were approved by the Audit
Committee.
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Year Ended March 31,
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2009
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2008
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Audit Fees(1)
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$
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636,000
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$
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614,000
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Audit-Related Fees(2)
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48,000
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Tax Fees
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All Other Fees
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|
|
Total All Fees
|
|
$
|
684,000
|
|
|
$
|
614,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Audit fees represent fees for professional services provided in
connection with the audit of our financial statements and review
of our quarterly financial statements, including attestation
services related to Section 404 of the Sarbanes-Oxley Act
of 2002 and Abaxis tax deferral savings plan.
|
|
(2)
|
|
Audit-related fees represent fees for assurance and related
services that are reasonably related to the performance of the
audit or review of our financial statements and are not reported
under Audit Fees. In fiscal 2009, these services
include due diligence services pertaining to potential
acquisitions.
|
PRE-APPROVAL
POLICIES AND PROCEDURES
The Audit Committee has adopted a policy for the pre-approval of
all audit and non-audit services to be performed for the Company
by the independent registered public accounting firm. The policy
generally pre-approves specified services in the defined
categories of audit services, audit-related services, and tax
services up to specified amounts. Pre-approval may also be given
as part of the Audit Committees approval of the scope of
the engagement of the independent auditor or on an individual
explicit
case-by-case
basis before the independent auditor is engaged to provide each
service. The pre-approval of services may be delegated to one or
more of the Audit Committees members, but the decision
must be reported to the full Audit Committee at its next
scheduled meeting.
14
The Audit Committee has considered the role of Burr,
Pilger & Mayer LLP in providing audit and
audit-related services to Abaxis and has concluded that the
rendering of the services by Burr, Pilger & Mayer LLP
is compatible with maintaining the principal accountants
independence.
VOTE
REQUIRED AND RECOMMENDATION OF THE BOARD OF DIRECTORS
The affirmative vote of the holders of a majority of the shares
present in person or represented by proxy and voting at the
annual meeting (which shares voting affirmatively also
constitute at least a majority of the required quorum) will be
required to ratify the selection of Burr, Pilger &
Mayer LLP. Although abstentions and broker non-votes
are counted as present for purposes of a quorum, they will not
be counted for any purpose in determining whether this matter
has been approved.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 2.
15
SECURITY
OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect
to the beneficial ownership of our common stock as of
August 31, 2009 by (i) each of the Named Executive
Officers in the Summary Compensation Table appearing in this
proxy statement; (ii) each of our directors; (iii) all
of our executive officers and directors as a group and
(iv) seven holders of at least five percent of our common
stock. The persons named in the table have sole or shared voting
and investment power with respect to all shares of common stock
shown as beneficially owned by them, subject to community
property laws where applicable and to the information contained
in the footnotes to this table.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent of Abaxis
|
|
|
|
Shares
|
|
|
Common Stock
|
|
|
|
Beneficially
|
|
|
Beneficially
|
|
Name and Address of Beneficial Owner
|
|
Owned
|
|
|
Owned(1)
|
|
|
Five Percent Holders:
|
|
|
|
|
|
|
|
|
Brown Capital Management, Inc.(3)
|
|
|
2,371,380
|
|
|
|
10.8
|
%
|
Capital World Investors(4)
|
|
|
1,486,800
|
|
|
|
6.8
|
%
|
Neuberger Berman Group LLC and Neuberger Berman LLC(5)
|
|
|
1,453,875
|
|
|
|
6.6
|
%
|
Wasatch Advisors, Inc.(6)
|
|
|
1,448,354
|
|
|
|
6.6
|
%
|
Barclays Global Investors, NA, Barclays Global
Fund Advisors, and Barclays Global Investors, LTD(7)
|
|
|
1,403,996
|
|
|
|
6.4
|
%
|
Kayne Anderson Rudnick Investment Management, LLC(8)
|
|
|
1,275,646
|
|
|
|
5.8
|
%
|
FMR LLC(9)
|
|
|
1,139,400
|
|
|
|
5.2
|
%
|
Executive Officers:(2)
|
|
|
|
|
|
|
|
|
Clinton H. Severson(10)
|
|
|
671,564
|
|
|
|
3.0
|
%
|
Vladimir E. Ostoich, Ph.D.(11)
|
|
|
405,750
|
|
|
|
1.8
|
%
|
Alberto R. Santa Ines(12)
|
|
|
126,605
|
|
|
|
*
|
|
Kenneth P. Aron, Ph.D.(13)
|
|
|
107,698
|
|
|
|
*
|
|
Martin V. Mulroy(14)
|
|
|
21,643
|
|
|
|
*
|
|
Outside Directors:(2)
|
|
|
|
|
|
|
|
|
Richard J. Bastiani, Ph.D.(15)
|
|
|
81,500
|
|
|
|
*
|
|
Prithipal Singh, Ph.D.(16)
|
|
|
30,500
|
|
|
|
*
|
|
Henk J. Evenhuis(17)
|
|
|
22,500
|
|
|
|
*
|
|
Ernest S. Tucker, III, M.D.(18)
|
|
|
13,000
|
|
|
|
*
|
|
Executive officers and directors as a group
(11 persons)
(19)
|
|
|
1,507,379
|
|
|
|
6.7
|
%
|
|
|
|
*
|
|
Less than one percent.
|
|
(1)
|
|
The percentages shown in this column are calculated based on
22,013,876 shares of common stock outstanding on
August 31, 2009 and includes shares of common stock that
such person or group had the right to acquire on or within
60 days after that date, including, but not limited to,
upon the exercise of options.
|
|
(2)
|
|
The business address of the beneficial owners listed is
c/o Abaxis,
Inc., 3240 Whipple Road, Union City, CA 94587.
|
|
(3)
|
|
Based on information set forth in a Schedule 13G/A filed
with the SEC on May 13, 2009 by Brown Capital Management,
Inc., reporting sole power to vote and dispose of 1,125,215 and
2,371,380 shares, respectively. The business address for
Brown Capital Management, Inc. is 1201 North Calvert Street,
Baltimore, MD 21202.
|
|
(4)
|
|
Based on information set forth in a Schedule 13G filed with
the SEC on February 13, 2009 by Capital World Investors,
reporting sole power to vote and dispose of
1,486,800 shares. The business address for Capital World
Investors is 333 South Hope Street, Los Angeles, CA 90071.
|
16
|
|
|
(5)
|
|
Based on information set forth in a Schedule 13G filed with
the SEC on June 11, 2009 by both Neuberger Berman Group LLC
and Neuberger Berman LLC, reporting sole power to vote and
dispose of 4,025 and 0 shares, respectively, and shared
power to vote and dispose of 1,098,200 and
1,453,875 shares, respectively. The business address for
both Neuberger Berman Group LLC and Neuberger Berman LLC is 605
Third Avenue, New York, NY 10158.
|
|
(6)
|
|
Based on information set forth in a Schedule 13G/A filed
with the SEC on February 17, 2009 by Wasatch Advisors,
Inc., reporting sole power to vote and dispose of
1,448,354 shares. The business address for Wasatch
Advisors, Inc. is 150 Social Hall Avenue, Salt Lake City, UT
84111.
|
|
(7)
|
|
Based on information set forth in a Schedule 13G filed with
the SEC on February 5, 2009 by Barclays Global Investors,
NA, reporting sole power to vote and dispose of 423,366 and
510,516 shares, respectively; by Barclays Global
Fund Advisors, reporting sole power to vote and dispose of
629,527 and 878,670 shares, respectively; and by Barclays
Global Investors, LTD, reporting sole power to vote and dispose
of 800 and 14,810 shares, respectively. Each of the
entities listed in the Schedule 13G disclaim beneficial
ownership of the shares as a group, but have been aggregated
together solely for the purposes of this disclosure. According
to the Schedule 13G, the shares reported are held in trust
accounts for the economic benefit of the beneficiaries of those
accounts. The business address for Barclays Global Investors, NA
and Barclays Global Fund Advisors is 400 Howard Street,
San Francisco, CA 94105. The business address for Barclays
Global Investors, LTD is Murray House, 1 Royal Mint Court,
London, EC3N 4HH.
|
|
(8)
|
|
Based on information set forth in a Schedule 13G/A filed
with the SEC on February 10, 2009 by Kayne Anderson Rudnick
Investment Management, LLC, reporting sole power to vote and
dispose of 1,275,646 shares. The business address for Kayne
Anderson Rudnick Investment Management, LLC is 1800 Avenue of
the Stars, 2nd Floor, Los Angeles, CA 90067.
|
|
(9)
|
|
Based on information set forth in a Schedule 13G filed with
the SEC on February 17, 2009 by FMR LLC, reporting sole
power to vote and dispose of 0 and 1,139,400 shares,
respectively. The business address for FMR LLC is 82 Devonshire
Street, Boston, MA 02109.
|
|
(10)
|
|
Includes:
|
|
|
|
461,147 shares held by
Mr. Severson; and
|
|
|
|
210,417 shares subject to stock options
exercisable by Mr. Severson within sixty days of
August 31, 2009.
|
|
(11)
|
|
Includes:
|
|
|
|
152,167 shares held by Dr. Ostoich;
|
|
|
|
26,355 shares held by Dr. Ostoichs
IRA;
|
|
|
|
22,400 shares held by Mrs. Ostoichs
IRA;
|
|
|
|
117,328 shares held by the Vladimir Ostoich and
Liliana Ostoich Trust Fund, for the benefit of
Dr. Ostoich and his wife; and
|
|
|
|
87,500 shares subject to stock options
exercisable by Dr. Ostoich within sixty days of
August 31, 2009.
|
|
(12)
|
|
Includes:
|
|
|
|
24,173 shares held by Mr. Santa
Ines; and
|
|
|
|
102,432 shares subject to stock options
exercisable by Mr. Santa Ines within sixty days of
August 31, 2009.
|
|
(13)
|
|
Includes:
|
|
|
|
13,198 shares held by Dr. Aron; and
|
|
|
|
94,500 shares subject to stock options
exercisable by Dr. Aron within sixty days of
August 31, 2009.
|
|
(14)
|
|
Includes:
|
|
|
|
8,102 shares held by Mr. Mulroy; and
|
|
|
|
13,541 shares subject to stock options
exercisable by Mr. Mulroy within sixty days of
August 31, 2009.
|
|
(15)
|
|
Includes:
|
|
|
|
57,500 shares held by
Dr. Bastiani; and
|
|
|
|
24,000 shares subject to stock options
exercisable by Dr. Bastiani within sixty days of
August 31, 2009.
|
17
|
|
|
(16)
|
|
Includes:
|
|
|
|
8,500 shares held by Dr. Singh; and
|
|
|
|
22,000 shares subject to stock options
exercisable by Dr. Singh within sixty days of
August 31, 2009.
|
|
(17)
|
|
Includes:
|
|
|
|
4,500 shares held by Mr. Evenhuis; and
|
|
|
|
18,000 shares subject to stock options
exercisable by Mr. Evenhuis within sixty days of
August 31, 2009.
|
|
(18)
|
|
Reflects 13,000 shares subject to stock options exercisable
by Dr. Tucker within sixty days of August 31, 2009.
|
|
(19)
|
|
Includes:
|
|
|
|
905,989 shares held by all executive officers
and directors as a group; and
|
|
|
|
601,390 shares subject to stock options
exercisable by all executive officers and directors as a group
within sixty days of August 31, 2009.
|
SECTION 16(A)
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires our executive
officers, directors and persons who beneficially own more than
10% of our equity securities to file initial reports of
ownership and reports of changes in ownership with the SEC. Such
persons are required by SEC regulations to furnish us with
copies of all Section 16(a) forms they file.
Based solely on our review of the copies of Forms 3, 4 and
5 and amendments thereto received by us, we believe that during
the period from April 1, 2008 through March 31, 2009,
our executive officers, directors and greater than 10%
shareholders complied with all applicable filing requirements
applicable to these executive officers, directors and greater
than 10% shareholders, except with respect to one late report
filing, covering one transaction, by Mr. Brenton Hanlon,
one of our executive officers and a former director.
18
EXECUTIVE
COMPENSATION
COMPENSATION
DISCUSSION AND ANALYSIS
Overview
The goals of our executive compensation program are to attract,
retain, motivate and reward executive officers who contribute to
our success and to incentivize these executives on both a
short-term and long-term basis to achieve our business
objectives. This program combines cash and equity awards in the
proportions that we believe will motivate our executive officers
to increase shareholder value over the long-term.
Our executive compensation program is designed to achieve the
following objectives:
|
|
|
|
|
to align our executive compensation with our strategic business
objectives;
|
|
|
|
to align the interests of our executive officers with both
short-term and long-term shareholder interests; and
|
|
|
|
to place a substantial portion of our executives
compensation at risk such that actual compensation depends on
both overall company performance and individual performance.
|
Executive
Compensation Program Objectives and Framework
Our executive compensation program has three primary components:
(1) base salary, (2) annual cash incentive bonus and
(3) equity grants. Base salaries for our executive officers
are a minimum fixed level of compensation consistent with or
below competitive market practice. Annual cash incentive bonuses
awarded to our executive officers are intended to incentivize
and reward achievement of financial, operating and strategic
objectives during the fiscal year. Equity grants awarded to our
executive officers are designed to ensure that incentive
compensation is linked to our long-term company performance,
promote retention and to align our executives long-term
interests with shareholders long-term interests. Our
executive officers total potential cash compensation is
heavily weighted toward annual cash incentive bonuses, because
our Compensation Committee and Board of Directors believes this
weighting best aligns the interests of our executive officers
with that of shareholders generally.
Executive compensation is reviewed annually by our Compensation
Committee and Board of Directors, and adjustments are made to
reflect company objectives and competitive conditions.
Generally, base salaries are adjusted effective May 1 of each
year. We also offer our executive officers participation in our
401(k) plan, health care insurance, flexible spending accounts
and certain other benefits available generally to all full-time
employees.
Role of
Our Compensation Committee
Our Compensation Committee, which operates under a written
charter adopted by the Board of Directors, is primarily
responsible for reviewing and recommending to the Board of
Directors for approval the compensation arrangements for our
executive officers and directors. In carrying out these
responsibilities, the Compensation Committee shall review all
components of executive officer and director compensation for
consistency with the Compensation Committees compensation
philosophy as in effect from time to time. In connection with
their review and recommendations, our Compensation Committee
also considers the recommendations of our Chief Executive
Officer, Mr. Clinton Severson. Our Compensation Committee
gives considerable weight to Mr. Seversons
recommendations because of his direct knowledge of each
executive officers performance and contribution to our
financial performance. However, Mr. Severson does not
participate in the determination of his own compensation. No
other executive officers participate in the determination or
recommendation of the amount or form of executive officer
compensation, except the Companys Chief Financial Officer
as discussed below. Our Compensation Committee does not delegate
any of its functions in determining executive
and/or
director compensation. To date, our Compensation Committee has
not established any formal policies or guidelines for allocating
compensation between long-term and currently paid out
compensation, cash and non-cash compensation, or among different
forms of non-cash compensation.
Our Compensation Committee may discuss with our Chief Executive
Officer or Chief Financial Officer our financial, operating and
strategic business objectives, bonus targets or performance
goals. The Compensation Committee reviews and determines the
appropriateness of the financial measures and performance goals,
as well as
19
assesses the degree of difficulty in achieving specific bonus
targets and performance goals. The Compensation Committee then
presents its recommendation for executive compensation to the
Board of Directors for final review and approval. Typically,
these recommendations are made to our Board of Directors during
the first quarter of the ensuing fiscal year.
From time to time, our Compensation Committee may engage an
independent compensation advisor to obtain competitive
compensation data. In March 2006, we retained the independent
compensation consulting firm of Top Five Data Services, Inc.
(Top Five) to, among other things, help identify
appropriate peer group companies and to obtain and evaluate
executive compensation data for these companies, and took its
recommendations into account in setting fiscal 2007 executive
compensation. We did not engage another compensation consultant,
or request additional recommendations from Top Five, in
connection with our determination of fiscal 2008 or fiscal 2009
executive compensation because our Compensation Committee and
Board of Directors determined that many of the recommendations
made by Top Five with respect to fiscal 2007 continued to be
relevant for fiscal 2008 and fiscal 2009. In May 2008, our
Compensation Committee engaged an independent compensation
consulting firm, Watson Wyatt, to prepare competitive
benchmarking studies as to, and advise the Compensation
Committee on long-term equity compensation for executives in
similarly-situated companies. Our Compensation Committee and
Board of Directors may engage compensation consultants in the
future as they deem it to be necessary or appropriate.
Competitive
Benchmarking
In April 2006, Top Five, in consultation with our Compensation
Committee, compared our senior management compensation to the
senior management compensation at a group of 19 companies
(the Compensation Peer Group). This Compensation
Peer Group represented similarly-situated medical device and
diagnostic companies that were identified by Top Five as
companies with similar financial growth and as competitors for
executive talent. The following companies comprised the
Compensation Peer Group:
|
|
|
|
|
Abiomed
|
|
Conceptus
|
|
Palomar Medical Technologies
|
Adeza Biomedical
|
|
Cutera
|
|
Surmodics
|
Angiodynamics
|
|
Digene
|
|
Thoratec
|
Aspect Medical Systems
|
|
Intralase
|
|
Vivus
|
ATS Medical
|
|
Kensey Nash
|
|
VNUS Medical Technologies
|
Biosite
|
|
Meridian Bioscience
|
|
|
Cholestech
|
|
Orasure Technologies
|
|
|
Top Five measured our relative performance against the
Compensation Peer Group over one and three year periods based on
the following three financial metrics:
|
|
|
|
|
total shareholder return;
|
|
|
|
revenue; and
|
|
|
|
EBITDA (earnings before income tax, depreciation and
amortization).
|
The market data obtained regarding the Compensation Peer Group
was considered by the Compensation Committee in its fiscal 2009
executive compensation decisions.
Compensation
Determinations
The Compensation Committee did not target executive compensation
in fiscal 2009 to any specific benchmarks against the
Compensation Peer Group, but did generally target total
compensation to be competitive with companies in the
Compensation Peer Group with similar financial growth rates
based on the compensation information for the Compensation Peer
Group in fiscal 2006. However, our executive officers
total potential cash compensation is more heavily weighted
toward annual cash incentive bonuses than most companies in the
Compensation Peer Group. In addition to any competitive
benchmarks the Compensation Committee deems relevant, the
Compensation Committee also considers the recommendations from
our Chief Executive Officer regarding the compensation of our
executive officers who report directly to him. These
recommendations generally
20
include annual adjustments to compensation levels, an assessment
of each executive officers overall individual
contribution, scope of responsibilities and level of experience.
Elements
of Compensation
Base
Salary
We provide an annual base salary to each of our executive
officers, including each of the named executive officers listed
on the Summary Compensation Table below (the Named
Executive Officers). Each base salary is reviewed annually
by the Compensation Committee and adjusted for the ensuing year
based on both (i) an evaluation of individual job
performance during the prior year, and (ii) an evaluation
of the compensation levels of similarly-situated executive
officers at the Compensation Peer Group and in our industry
generally.
In determining fiscal 2009 base salaries for our Named Executive
Officers, our Compensation Committee generally targeted salaries
to be between the 25th and 50th percentile of the
Compensation Peer Group. Our Compensation Committee considered
this 25th and 50th percentile range as a general
guideline for the appropriate level of potential salaries, but
did not attempt to specifically match this or any other
percentile. Our Compensation Committee also considered the
recommendations of the Chief Executive Officer regarding the
compensation of each of the Named Executive Officers who
reported directly to him. However, the Compensation Committee
and our Board of Directors did not base their considerations on
any single factor but rather considered a mix of factors and
evaluated individual salaries against that mix.
Our Board of Directors set salaries for fiscal 2009 after
considering a peer company analysis of total compensation for
executive officers prepared in April 2006 by Top Five and the
recommendations of the Compensation Committee. For fiscal 2009,
the Compensation Committee recommended that we increase base
salaries in amounts designed to reward each of the Named
Executive Officers for their performance in the prior year while
maintaining base salaries at an appropriately competitive level.
Our Compensation Committee did not use any specific formula
based on the factors described above to determine the final base
salary levels for each Named Executive Officer. For fiscal 2009,
Dr. Aron received an increase of 8.8% in his base salary
upon his promotion to Chief Technology Officer.
In determining fiscal 2010 base salaries for our Named Executive
Officers, our Compensation Committee recommended to the Board of
Directors not to increase executive base salaries for fiscal
2010 due to the global economic downturn.
Based on the recommendations of the Compensation Committee, our
Board of Directors approved the following base salaries
(effective May 1, 2008 for fiscal 2009 and July 1,
2009 for fiscal 2010) for our Named Executive Officers:
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2009
|
|
|
Fiscal 2010
|
|
Named Executive Officer
|
|
Base Salary
|
|
|
Base Salary
|
|
|
Clinton H. Severson
|
|
$
|
360,000
|
|
|
$
|
360,000
|
|
Alberto R. Santa Ines
|
|
$
|
200,000
|
|
|
$
|
200,000
|
|
Kenneth P. Aron, Ph.D.
|
|
$
|
210,000
|
|
|
$
|
210,000
|
|
Vladimir E. Ostoich, Ph.D.
|
|
$
|
210,000
|
|
|
$
|
210,000
|
|
Martin V. Mulroy
|
|
$
|
185,000
|
|
|
$
|
185,000
|
|
Fiscal 2009 and 2010 base salary increases for the Named
Executive Officers were as follows:
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2009
|
|
|
Fiscal 2010
|
|
|
|
Percent Increase
|
|
|
Percent Increase
|
|
Named Executive Officer
|
|
in Base Salary
|
|
|
in Base Salary
|
|
|
Clinton H. Severson
|
|
|
6.5
|
%
|
|
|
|
%
|
Alberto R. Santa Ines
|
|
|
8.1
|
%
|
|
|
|
%
|
Kenneth P. Aron, Ph.D.
|
|
|
8.8
|
%
|
|
|
|
%
|
Vladimir E. Ostoich, Ph.D.
|
|
|
3.5
|
%
|
|
|
|
%
|
Martin V. Mulroy
|
|
|
5.7
|
%
|
|
|
|
%
|
21
Annual
Cash Incentive Bonus
Our annual cash incentive bonus program is an
at-risk compensation arrangement designed to provide
market competitive cash incentive opportunities that reward our
executive officers for the achievement of key financial
performance goals that we believe are important for us in
creating long-term shareholder value. Most importantly, the
program is structured to achieve our overall objective of tying
this element of compensation to the attainment of company
performance goals that will contribute to our financial success
and create shareholder value.
Our annual cash incentive bonus paid to each executive officer,
including each of our Named Executive Officers, is primarily
based upon Abaxis achieving two equally-weighted financial
performance goals, quarterly net sales and quarterly pre-tax
income. Additionally, the bonus targets established by the
Compensation Committee require executive officers to increase
annual corporate financial performance during the applicable
fiscal year, compared to our previous years actual
financial results. Accordingly, meeting the bonus targets is
highly challenging and requires executive officers to improve
financial performance on a
year-over-year
basis and, thus, a substantial portion of our executive
officers compensation is at risk if corporate financial
results are not achieved during a particular fiscal year. In
addition to meeting financial goals, we must not exceed a
certain failure rate on our reagents discs in order for cash
incentives to be paid to our executive officers. However, our
Compensation Committee has the discretion to grant bonuses even
if these performance goals are not met.
For fiscal 2009, our Compensation Committee generally targeted
total cash compensation to be at or above the
75th percentile of the Compensation Peer Group. Our
Compensation Committee considered this 75th percentile
target as a general guideline for the appropriate level of
potential cash bonus compensation, but did not attempt to
specifically match this or any other percentile. In April 2008,
our Board of Directors approved the fiscal 2009 target bonus
levels for our executive officers. The following table
summarizes the fiscal 2009 target bonus amounts and the bonus
amounts awarded for fiscal 2009 for our Named Executive Officers:
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2009
|
|
|
Fiscal 2009
|
|
Named Executive Officer
|
|
Target Bonus
|
|
|
Bonus Awarded
|
|
|
Clinton H. Severson
|
|
$
|
525,000
|
|
|
$
|
226,406
|
|
Alberto R. Santa Ines
|
|
$
|
300,000
|
|
|
$
|
129,375
|
|
Kenneth P. Aron, Ph.D.
|
|
$
|
300,000
|
|
|
$
|
129,375
|
|
Vladimir E. Ostoich, Ph.D.
|
|
$
|
300,000
|
|
|
$
|
129,375
|
|
Martin V. Mulroy
|
|
$
|
275,000
|
|
|
$
|
139,219
|
|
Payment of the target bonus is equally weighted between
achievement of our quarterly net sales performance goal and our
quarterly pre-tax income performance goal. For fiscal 2009,
bonuses were earned only if we achieved at least 90% of one or
more of our pre-established quarterly net sales
and/or
quarterly pre-tax income goals. After the initial threshold is
met, the amount of the target bonus paid is based on a sliding
scale relative to the proportionate achievement of the
performance goals. If we achieve 90% of only one performance
goal, the payout would be limited to 25% of the aggregate target
bonus. For each 1% above 90% of that performance goal, the
payout would increase by 2.5% for the aggregate target bonus.
The target bonus will be fully earned if at least 100% of both
performance goals are achieved. For each 1% above 100% of a
performance goal, the payout would increase by 1.5% for the
aggregate target bonus. The maximum potential bonus payout is
200% of the target bonus, provided we achieve greater than 133%
of at least one of the performance goals. Assuming targets are
reached, the bonus payments are paid as follows: 15% of the
applicable bonus amount for the first quarter, 25% in the second
and third quarters, and 35% in the fourth quarter. At the end of
the fourth quarter, the final amount of the bonus earned will be
adjusted to reflect overall performance against the year. For
the Named Executive Officers, excluding Mr. Mulroy, our
Vice President of Veterinary Sales and Marketing for North
America, the financial targets for fiscal 2009 were based on the
companys annual net sales and pre-tax income goals. Based
on these pre-established goals, our other Named Executive
Officers received 43.1% of their target bonus awards for fiscal
2009. Since Mr. Mulroys responsibility is to manage
the veterinary sales in North America, his financial targets for
fiscal 2009 were based on sales for the veterinary market for
North America and on the companys annual pre-tax income
goals. Based on these pre-established goals, Mr. Mulroy
received 50.6% of his target bonus awards for fiscal 2009.
Due to the global economic downturn, the Compensation Committee
recommended to our Board of Directors that for fiscal 2010
target bonuses, we maintain the target bonuses from fiscal 2009
for the Named Executive
22
Officers. In April 2009, our Board of Directors approved the
fiscal 2010 target bonus levels for our executive officers. The
following table summarizes the fiscal 2010 target bonus amounts
for our Named Executive Officers:
|
|
|
|
|
|
|
Fiscal 2010
|
|
Named Executive Officer
|
|
Target Bonus
|
|
|
Clinton H. Severson
|
|
$
|
525,000
|
|
Alberto R. Santa Ines
|
|
$
|
300,000
|
|
Kenneth P. Aron, Ph.D.
|
|
$
|
300,000
|
|
Vladimir E. Ostoich, Ph.D.
|
|
$
|
300,000
|
|
Martin V. Mulroy
|
|
$
|
275,000
|
|
We expect payment of the target bonus, as identified above, to
continue to be equally weighted at 50% for achievement of our
quarterly net sales performance goal and 50% for achievement of
our quarterly pre-tax income performance goal. For fiscal 2010,
bonuses will only be earned if we achieve at least 90% of one or
more of our pre-established quarterly net sales
and/or
quarterly pre-tax income goals during fiscal 2010. After the
initial threshold is met, the amount of the target bonus paid
will be based on a sliding scale relative to the proportionate
achievement of the performance goals. If we achieve 90% of only
one performance goal, the payout would be limited to 25% of the
aggregate target bonus. For each 1% above 90% of that
performance goal, the payout would increase by 2.5% for the
aggregate target bonus. The target bonus will be fully earned if
at least 100% of both performance goals are achieved. For each
1% above 100% of a performance goal, the payout would increase
by 1.5% for the aggregate target bonus. The maximum potential
bonus payout is 200% of the target bonus, provided we achieve
greater than 133% of at least one of the performance goals.
Assuming targets are reached, we expect that the bonus payments
will be paid as follows: 15% of the applicable bonus amount for
the first quarter, 25% in the second and third quarters, and 35%
in the fourth quarter. At the end of the fourth quarter of
fiscal 2010, the final payment will be adjusted to reflect
overall performance against the year. Our Compensation Committee
and Board of Directors have the discretion to adjust the
parameters and performance goals for payment of these annual
performance bonuses.
We do not currently have a formal policy regarding adjustments
or recovery of awards or payments following a restatement of
financial performance targets. In such a circumstance, the
Compensation Committee would evaluate whether compensation
adjustments were appropriate based upon the facts and
circumstances surrounding the restatement.
Long-term
Equity Incentive Compensation
Under our 2005 Equity Incentive Plan, we are permitted to award
stock options, stock appreciation rights, restricted stock
awards, restricted stock units, performance shares, performance
units, deferred compensation awards or other share-based awards.
Beginning in fiscal 2007, we began granting restricted stock
units to our executive officers in lieu of other forms of
equity-based grants. Prior to fiscal 2007, equity-based grants
to our executive officers comprised solely of stock options.
There were no equity grants to our current Named Executive
Officers in fiscal 2006. Equity grants to our Named Executive
Officers in fiscal 2009 and fiscal 2010 are discussed below. We
do not currently have stock ownership guidelines for our
executive officers.
Stock
Options
Prior to fiscal 2007, a substantial portion of our executive
compensation arrangement consisted of long-term incentive
grants, comprising of stock options. We granted stock options
with an exercise price equal to the fair market value of our
common stock on the grant date. Accordingly, our executive
officers only realize actual compensation value if our
shareholders realize value. In addition, we believe the stock
options granted to executive officers created retention
incentives as the stock options vested over a period of four
years based on cliff-vesting terms only as long as executive
officers remained an employee with us. For the unvested stock
options granted prior to April 1, 2006, we are required to
recognize share-based compensation expense over the vesting
period in accordance with Statement of Financial Accounting
Standards No. 123 (revised 2004), Share-Based
Payment, which we adopted in fiscal 2007 using the
modified prospective method.
23
Restricted
Stock Units
Fiscal 2009 Restricted Stock Unit Grants.
In
fiscal 2007, we granted restricted stock units with performance
acceleration. Our Board of Directors believed that this form of
long-term equity incentive will help ensure executive retention
and more directly link executive pay to company financial
performance. The four-year time-based vesting of the restricted
stock units granted in fiscal 2007 accelerates if certain
performance criteria are exceeded during the performance period.
For a discussion of the performance criteria, see the table
entitled Outstanding Equity Awards at Fiscal Year End
2009 below. The Compensation Committee approves all
restricted stock unit grants to our Named Executive Officers and
other executive officers.
In April 2008, after considering an analysis of total
compensation for our Named Executive Officers and upon the
recommendation of our Compensation Committee, our Board of
Directors granted 50,000 restricted stock units to our Chief
Executive Officer and 20,000 restricted stock units to each of
our other Named Executive Officers. The value of these equity
grants was approximately $1.3 million for our Chief
Executive Officer and approximately $500,000 for each of our
other Named Executive Officers. The Compensation Committee
believed that these grants of restricted stock units were
appropriate based on our financial performance over the prior
year. The four-year time-based vesting terms of the fiscal 2009
restricted stock unit awards are as follows:
|
|
|
|
|
five percent vesting after the first year of continuous
employment;
|
|
|
|
additional ten percent after the second year of continuous
employment;
|
|
|
|
additional 15 percent after the third year of continuous
employment; and
|
|
|
|
the remaining 70 percent after the fourth year of
continuous employment.
|
Time-based vesting terms is intended to provide retention for
our executive officers as the awards vest based on continuous
employment. Unlike the fiscal 2007 restricted stock units, these
restricted stock units are not subject to performance-based
acceleration. Our Compensation Committee believed that retention
of the Named Executive Officers was key to our success and that
these additional restricted stock units would be more likely,
given the time-based vesting schedule of the restricted stock
units, to maximize retention of our Named Executive Officers
without performance-based acceleration milestones.
Fiscal 2010 Restricted Stock Unit Grants.
In
April 2009, after considering an analysis of long-term equity
incentives conducted by Watson Wyatt in fiscal 2009, for our
Named Executive Officers and upon the recommendation of the
Compensation Committee, our Board of Directors granted 55,000
restricted stock units to our Chief Executive Officer and 25,000
restricted stock units to each of our other Named Executive
Officers. The Compensation Committee believed that these grants
of restricted stock units were appropriate based on our
financial performance over the prior year. The fiscal 2010
restricted stock unit awards vest, based on time-based vesting
terms, in the same manner as the fiscal 2009 restricted stock
unit awards discussed above. The fiscal 2010 restricted stock
units are also not subject to performance-based acceleration.
Our Compensation Committee believed that retention of the Named
Executive Officers was key to our success and that these
additional restricted stock units would be more likely, given
the time-based vesting schedule of the restricted stock units,
to maximize retention of our Named Executive Officers without
performance-based acceleration milestones.
Other
Compensation and Benefits
We do not provide any of our executive officers with any
material perquisites. Currently, all benefits offered to our
executive officers, including an opportunity to participate in
our 401(k) plan, medical, dental, vision, life insurance,
disability coverage and flexible spending accounts, are also
available on a non-discriminatory basis to other full-time
employees. We also provide vacation and other paid holidays to
all full-time employees, including our Named Executive Officers.
Employment
Agreements
In August 2005, we entered into an employment agreement with
Clinton H. Severson, our President and Chief Executive Officer,
which provides Mr. Severson with a severance payment equal
to two years of salary, bonus and benefits if his employment
with us is terminated for any reason other than cause. Certain
severance benefits
24
provided pursuant to the Severance Plan (described below in
Change in Control Agreements) with respect to a
change of control supersede those provided pursuant to the
employment agreement. None of our other executives have
employment agreements with us.
Change in
Control Agreements
In July 2006, our Board of Directors, after considering a change
of control program analysis from the Compensation Peer Group
prepared by Top Five and upon the recommendation of our
Compensation Committee, approved and adopted the Abaxis, Inc.
Executive Change of Control Severance Plan (the Severance
Plan). The Severance Plan was adopted by our Board of
Directors to reduce the distraction of executives and potential
loss of executive talent that could arise from a potential
change of control. Participants in the Severance Plan include
Abaxis senior managers who are selected by the Board of
Directors. In December 2008, our Board of Directors amended the
Severance Plan to ensure its compliance with Section 409A
of the Internal Revenue Code of 1986, as amended (the
Code) and designated the following current executive
officers as participants in the Severance Plan: Clinton H.
Severson, our Chairman, President and Chief Executive Officer;
Alberto R. Santa Ines, our Chief Financial Officer and Vice
President of Finance; Kenneth P. Aron, Ph.D., our Chief
Technology Officer; Vladimir E. Ostoich, Ph.D., our Vice
President of Government Affairs and Vice President of Marketing
for the Pacific Rim; Donald P. Wood, our Chief Operations
Officer; and Martin V. Mulroy, our Vice President of Veterinary
Sales and Marketing for North America.
The Severance Plan provides that upon the occurrence of a change
of control a participants outstanding stock option(s) and
other unvested equity-based instruments will accelerate in full,
and any such stock awards shall become immediately exercisable.
In addition, the Severance Plan provides that, if the
participants employment is terminated by us (or any
successor of Abaxis) for any reason other than cause, death, or
disability within 18 months following the change of control
date and such termination constitutes a separation in service,
the participant is eligible to receive severance benefits as
follows:
|
|
|
|
|
on the 60th day after the termination date, a lump sum cash
payment equal to two times the sum of the participants
annual base salary and the participants target annual
bonus amount for the year in which the change of control occurs;
|
|
|
|
payment of up to 24 months of premiums for medical, dental
and vision benefits, provided, however, that if the participant
becomes eligible to receive comparable benefits under another
employers plan, the Companys benefits shall be
secondary to those provided under such other plan;
|
|
|
|
reimbursement, on a monthly basis, of up to 24 months of
premiums for disability and life insurance benefits if the
participant elects to convert his or her disability
and/or
life
insurance benefits under the Companys plans into
individual policies following termination; and
|
|
|
|
payment of an amount equal to any excise tax imposed under
Section 4999 of the Code, provided, however, that payment
of such amount is capped at $1,000,000 per participant.
|
Payment of the foregoing severance benefits is conditioned upon
the participants execution of a valid and effective
release of claims against us.
Tax
Considerations
Deductibility
of Executive Compensation
We have considered the provisions of Section 162(m) of the
Code and related Treasury Regulations which restrict
deductibility of executive compensation paid to our Named
Executive Officers and our other executive officers holding
office at the end of any year to the extent such compensation
exceeds $1,000,000 for any of such officers in any year and does
not qualify for an exception under the statute or regulations.
The Compensation Committee endeavors to maximize deductibility
of compensation under Section 162(m) of the Code to the
extent practicable while maintaining a competitive,
performance-based compensation program. However, tax
consequences, including tax deductibility, are subject to many
factors (such as changes in the tax laws and regulations or
25
interpretations thereof and the timing of various decisions by
officers regarding stock options) which are beyond the control
of both the Company and our Compensation Committee. In addition,
our Compensation Committee believes that it is important to
retain maximum flexibility in designing compensation programs
that meet its stated business objectives. For these reasons, our
Compensation Committee, while considering tax deductibility as a
factor in determining compensation, will not limit compensation
to those levels or types of compensation that will be
deductible. Our Compensation Committee will continue to consider
alternative forms of compensation, consistent with its
compensation goals that preserve deductibility. The Compensation
Committee does not believe that the components of our
compensation will be likely to exceed $1,000,000 by a material
amount for any affected executive officer in the near future and
therefore concluded that no further action with respect to
qualifying such compensation for deductibility was necessary at
this time.
26
EXECUTIVE
COMPENSATION
Summary
Compensation Table
The following table sets forth for fiscal 2009, 2008 and 2007,
the compensation awarded or paid to, or earned by, Abaxis
Chief Executive Officer, Chief Financial Officer and the three
other most highly compensated executive officers at
March 31, 2009 (collectively, the Named Executive
Officers).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
|
|
|
Option
|
|
|
Incentive Plan
|
|
|
All Other
|
|
|
|
|
|
|
Fiscal
|
|
|
Salary
|
|
|
Bonus
|
|
|
Awards
|
|
|
Awards
|
|
|
Compensation
|
|
|
Compensation
|
|
|
Total
|
|
Name and Principal Position
|
|
Year
|
|
|
($)
|
|
|
($)
|
|
|
($)(1)
|
|
|
($)(2)
|
|
|
($)(3)
|
|
|
($)(4)
|
|
|
($)
|
|
|
Clinton H. Severson
|
|
|
2009
|
|
|
|
355,770
|
|
|
|
|
|
|
|
465,214
|
|
|
|
|
|
|
|
226,406
|
|
|
|
9,311
|
(5)
|
|
|
1,056,701
|
|
President, Chief Executive
|
|
|
2008
|
|
|
|
336,500
|
|
|
|
|
|
|
|
253,941
|
|
|
|
1,099
|
|
|
|
456,000
|
|
|
|
11,535
|
(5)
|
|
|
1,059,075
|
|
Officer and Chairman of the Board
|
|
|
2007
|
|
|
|
323,500
|
|
|
|
|
|
|
|
101,040
|
|
|
|
8,603
|
|
|
|
500,250
|
|
|
|
13,823
|
(5)
|
|
|
947,216
|
|
Alberto R. Santa Ines
|
|
|
2009
|
|
|
|
197,115
|
|
|
|
|
|
|
|
129,741
|
|
|
|
|
|
|
|
129,375
|
|
|
|
8,949
|
(6)
|
|
|
465,180
|
|
Chief Financial Officer and
|
|
|
2008
|
|
|
|
183,846
|
|
|
|
|
|
|
|
64,597
|
|
|
|
879
|
|
|
|
261,250
|
|
|
|
10,972
|
(6)
|
|
|
521,544
|
|
Vice President of Finance
|
|
|
2007
|
|
|
|
174,008
|
|
|
|
|
|
|
|
22,453
|
|
|
|
8,997
|
|
|
|
287,500
|
|
|
|
13,227
|
(6)
|
|
|
506,185
|
|
Kenneth P. Aron, Ph.D.
|
|
|
2009
|
|
|
|
206,730
|
|
|
|
|
|
|
|
129,741
|
|
|
|
|
|
|
|
129,375
|
|
|
|
19,585
|
(7)
|
|
|
485,431
|
|
Chief Technology Officer
|
|
|
2008
|
|
|
|
192,077
|
|
|
|
|
|
|
|
64,597
|
|
|
|
879
|
|
|
|
261,250
|
|
|
|
20,753
|
(7)
|
|
|
539,556
|
|
|
|
|
2007
|
|
|
|
184,054
|
|
|
|
|
|
|
|
22,453
|
|
|
|
6,882
|
|
|
|
287,500
|
|
|
|
22,592
|
(7)
|
|
|
523,481
|
|
Vladimir E. Ostoich, Ph.D.
|
|
|
2009
|
|
|
|
208,654
|
|
|
|
|
|
|
|
129,741
|
|
|
|
|
|
|
|
129,375
|
|
|
|
14,552
|
(8)
|
|
|
482,322
|
|
Vice President of
|
|
|
2008
|
|
|
|
202,077
|
|
|
|
|
|
|
|
64,597
|
|
|
|
879
|
|
|
|
261,250
|
|
|
|
16,599
|
(8)
|
|
|
545,402
|
|
Government Affairs and Vice President of Marketing for the
Pacific Rim
|
|
|
2007
|
|
|
|
194,100
|
|
|
|
|
|
|
|
22,453
|
|
|
|
6,882
|
|
|
|
287,500
|
|
|
|
17,013
|
(8)
|
|
|
527,948
|
|
Martin V. Mulroy
|
|
|
2009
|
|
|
|
183,077
|
|
|
|
|
|
|
|
129,741
|
|
|
|
6,218
|
|
|
|
139,219
|
|
|
|
7,896
|
(10)
|
|
|
466,151
|
|
Vice President of Veterinary Sales and Marketing for North
America(9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Awards consist of restricted stock units granted to the Named
Executive Officer in the fiscal year specified as well as prior
fiscal years. Amounts shown do not reflect whether the Named
Executive Officer has actually realized a financial benefit from
the awards (such as by vesting in a restricted stock unit
award). Amounts listed in this column represent the compensation
cost recognized by us for financial statement reporting
purposes. These amounts have been calculated in accordance with
Statement of Financial Accounting Standards No. 123
(revised 2004), Share-Based Payment
(SFAS No. 123(R)). For a discussion of the
assumptions used in determining the fair value of awards of
restricted stock units in the above table, see Note 11 of
the Notes to Consolidated Financial Statements included in our
Annual Report on
Form 10-K
filed with the SEC on June 12, 2009.
|
|
(2)
|
|
Awards consist of stock options granted to the Named Executive
Officer in the fiscal year specified as well as prior fiscal
years. Amounts shown do not reflect whether the Named Executive
Officer has actually realized a financial benefit from the
awards (such as by exercising stock options). Amounts listed in
this column represent the compensation cost recognized by us for
financial statement reporting purposes. These amounts have been
calculated in accordance with SFAS No. 123(R). For a
discussion of the assumptions used in determining the fair value
of awards of stock options in the above table, see Note 11
of the Notes to Consolidated Financial Statements included in
our Annual Report on
Form 10-K
filed with the SEC on June 12, 2009.
|
|
(3)
|
|
Represents aggregate cash performance bonuses earned during each
fiscal year based on achievement of corporate financial
performance goals, as described under Executive
Compensation Compensation Discussion and
Analysis above. These bonuses were paid in four quarterly
installments within one month following the end of the
applicable quarter upon achieving the established quarterly net
sales and quarterly pre-tax income goals for that quarter.
Amounts do not include bonuses paid during a fiscal year, with
respect to bonuses earned in a prior fiscal year.
|
27
|
|
|
(4)
|
|
Amounts listed are based upon our actual costs expensed in
connection with such compensation.
|
|
(5)
|
|
In fiscal 2009, consists of $4,652 in supplemental health plan
expenses reimbursed by us, $648 in group life insurance paid by
us, $626 in disability insurance premiums paid by us and $3,385
in matching contributions made by us to Mr. Seversons
401(k) account. In fiscal 2008, consists of $4,378 in
supplemental health plan expenses reimbursed by us, $780 in
group life insurance paid by us, $752 in disability insurance
premiums paid by us and $5,625 in matching contributions made by
us to Mr. Seversons 401(k) account. In fiscal 2007,
consists of $4,366 in supplemental health plan expenses
reimbursed by us, $780 in group life insurance paid by us, $812
in disability insurance premiums paid by us and $7,865 in
matching contributions made by us to Mr. Seversons
401(k) account.
|
|
(6)
|
|
In fiscal 2009, consists of $4,652 in supplemental health plan
expenses reimbursed by us, $432 in group life insurance paid by
us, $480 in disability insurance premiums paid by us and $3,385
in matching contributions made by us to Mr. Santa
Ines 401(k) account. In fiscal 2008, consists of $4,490 in
supplemental health plan expenses reimbursed by us, $420 in
group life insurance paid by us, $437 in disability insurance
premiums paid by us and $5,625 in matching contributions made by
us to Mr. Santa Ines 401(k) account. In fiscal 2007,
consists of $4,505 in supplemental health plan expenses
reimbursed by us, $420 in group life insurance paid by us, $437
in disability insurance premiums paid by us and $7,865 in
matching contributions made by us to Mr. Santa Ines
401(k) account.
|
|
(7)
|
|
In fiscal 2009, consists of $14,959 in supplemental health plan
expenses reimbursed by us, $451 in group life insurance paid by
us, $502 in disability insurance premiums paid by us and $3,673
in matching contributions made by us to Mr. Arons
401(k) account. In fiscal 2008, consists of $14,222 in
supplemental health plan expenses reimbursed by us, $444 in
group life insurance paid by us, $462 in disability insurance
premiums paid by us and $5,625 in matching contributions made by
us to Mr. Arons 401(k) account. In fiscal 2007,
consists of $14,186 in supplemental health plan expenses
reimbursed by us, $444 in group life insurance paid by us, $462
in disability insurance premiums paid by us and $7,500 in
matching contributions made by us to
Mr. Arons 401(k) account.
|
|
(8)
|
|
In fiscal 2009, consists of $10,599 in supplemental health plan
expenses reimbursed by us, $451 in group life insurance paid by
us, $502 in disability insurance premiums paid by us and $3,000
in matching contributions made by us to Mr. Ostoichs
401(k) account. In fiscal 2008, consists of $10,043 in
supplemental health plan expenses reimbursed by us, $444 in
group life insurance paid by us, $487 in disability insurance
premiums paid by us and $5,625 in matching contributions made by
us to Mr. Ostoichs 401(k) account. In fiscal 2007,
consists of $10,058 in supplemental health plan expenses
reimbursed by us, $468 in group life insurance paid by us, $487
in disability insurance premiums paid by us and $6,000 in
matching contributions made by us to Mr. Ostoichs
401(k) account.
|
|
(9)
|
|
Mr. Mulroy was not a Named Executive Officer for fiscal
2008 or 2007.
|
|
(10)
|
|
In fiscal 2009, consists of $4,652 in supplemental health plan
expenses reimbursed by us, $400 in group life insurance paid by
us, $444 in disability insurance premiums paid by us and $2,400
in matching contributions made by us to Mr. Mulroys
401(k) account.
|
Salary and Bonus in Proportion to Total
Compensation.
The following table sets forth the
percentage of base salary and annual cash incentive bonus earned
by each Named Executive Officer as a percentage of total
compensation for fiscal 2009.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annual Cash
|
|
|
|
Base Salary as a
|
|
|
Incentive Bonus as a
|
|
|
|
Percentage of
|
|
|
Percentage of
|
|
Named Executive Officer
|
|
Total Compensation
|
|
|
Total Compensation
|
|
|
Clinton H. Severson
|
|
|
34
|
%
|
|
|
21
|
%
|
Alberto R. Santa Ines
|
|
|
42
|
%
|
|
|
28
|
%
|
Kenneth P. Aron, Ph.D.
|
|
|
43
|
%
|
|
|
27
|
%
|
Vladimir E. Ostoich, Ph.D.
|
|
|
43
|
%
|
|
|
27
|
%
|
Martin V. Mulroy
|
|
|
39
|
%
|
|
|
30
|
%
|
28
CEO Employment Agreement.
In August 2005, we
entered into an employment agreement with Clinton H. Severson,
our President and Chief Executive Officer, which provides
Mr. Severson with a severance payment equal to two years of
salary, bonus and benefits if his employment with us is
terminated for any reason other than cause. Certain severance
benefits provided pursuant to the Severance Plan (described
above in Change of Control Agreements) with respect
to a change of control supersede those provided pursuant to the
employment agreement. None of our other executives have
employment agreements with us.
Grants of
Plan-Based Awards in Fiscal 2009
The following table sets forth the grants of plan-based awards
to our Named Executive Officers during fiscal 2009.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Awards:
|
|
|
Grant Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Fair Value of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated Future Payouts Under
|
|
|
Shares of
|
|
|
Stock and
|
|
|
|
|
|
|
Estimated Future Payouts Under Non-Equity Incentive Plan
Awards(1)
|
|
|
Equity Incentive Plan Awards
|
|
|
Stock or
|
|
|
Option
|
|
|
|
Grant
|
|
|
Threshold
|
|
|
Target
|
|
|
Maximum
|
|
|
Threshold
|
|
|
Target
|
|
|
Maximum
|
|
|
Units
|
|
|
Awards
|
|
Name
|
|
Date
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
(#)
|
|
|
(#)
|
|
|
(#)(2)
|
|
|
(#)
|
|
|
($)(3)
|
|
|
Clinton H. Severson
|
|
|
5/5/2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
|
|
|
|
|
|
|
1,250,000
|
|
|
|
|
|
|
|
|
131,250
|
|
|
|
525,000
|
|
|
|
1,050,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Alberto R. Santa Ines
|
|
|
5/5/2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
|
|
|
|
|
500,000
|
|
|
|
|
|
|
|
|
75,000
|
|
|
|
300,000
|
|
|
|
600,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kenneth P. Aron, Ph.D.
|
|
|
5/5/2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
|
|
|
|
|
500,000
|
|
|
|
|
|
|
|
|
75,000
|
|
|
|
300,000
|
|
|
|
600,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vladimir E. Ostoich, Ph.D.
|
|
|
5/5/2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
|
|
|
|
|
500,000
|
|
|
|
|
|
|
|
|
75,000
|
|
|
|
300,000
|
|
|
|
600,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Martin V. Mulroy
|
|
|
5/5/2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
|
|
|
|
|
|
|
500,000
|
|
|
|
|
|
|
|
|
68,750
|
|
|
|
275,000
|
|
|
|
550,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Actual cash performance bonuses, which were approved by the
Board of Directors upon recommendation by the Compensation
Committee based on achievement of corporate financial
performance goals for fiscal 2009, were paid in four quarterly
installments within one month following the end of the
applicable quarter upon achieving the established quarterly net
sales and quarterly pre-tax income goals. Actual cash
performance bonuses are shown in the Non-Equity Incentive
Plan Compensation column of the Summary Compensation
Table above.
|
|
(2)
|
|
Each of the equity-based awards reported in the Grants of
Plan-Based Awards table was granted under, and is subject
to, the terms of our 2005 Equity Incentive Plan. The time-based
vesting schedule of restricted stock unit grants during fiscal
2009 are described above in Restricted Stock Units.
|
|
(3)
|
|
Represents the fair value of the restricted stock unit award on
the date of grant, pursuant to SFAS No. 123(R). See
Note 11 of the Notes to Consolidated Financial Statements
included in our Annual Report on
Form 10-K
filed with the SEC on June 12, 2009 for additional
information.
|
29
Outstanding
Equity Awards at Fiscal Year End 2009
The following table shows, for the fiscal year ended
March 31, 2009, certain information regarding outstanding
equity awards at fiscal year end for our Named Executive
Officers.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Stock Awards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incentive
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Plan
|
|
|
Incentive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Awards:
|
|
|
Plan Awards:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Market or
|
|
|
|
Number of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market
|
|
|
Unearned
|
|
|
Payout Value
|
|
|
|
Securities
|
|
|
Number of
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Value of
|
|
|
Shares,
|
|
|
of Unearned
|
|
|
|
Underlying
|
|
|
Securities
|
|
|
|
|
|
|
|
|
Shares or
|
|
|
Shares or
|
|
|
Units or
|
|
|
Shares, Units
|
|
|
|
Unexercised
|
|
|
Underlying
|
|
|
|
|
|
|
|
|
Units of
|
|
|
Units of
|
|
|
Other
|
|
|
or Other
|
|
|
|
Options
|
|
|
Unexercised
|
|
|
Option
|
|
|
|
|
|
Stock That
|
|
|
Stock That
|
|
|
Rights That
|
|
|
Rights That
|
|
|
|
(#)
|
|
|
Options
|
|
|
Exercise
|
|
|
Option
|
|
|
Have Not
|
|
|
Have Not
|
|
|
Have Not
|
|
|
Have Not
|
|
|
|
Exercisable
|
|
|
(#)
|
|
|
Price
|
|
|
Expiration
|
|
|
Vested
|
|
|
Vested
|
|
|
Vested
|
|
|
Vested
|
|
Name
|
|
(1)
|
|
|
Unexercisable
|
|
|
($)(2)
|
|
|
Date
|
|
|
(#)
|
|
|
($)
|
|
|
(#)
|
|
|
($)(3)
|
|
|
Clinton H. Severson
|
|
|
150,000
|
|
|
|
|
|
|
|
4.87
|
|
|
|
4/24/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,417
|
|
|
|
|
|
|
|
3.85
|
|
|
|
4/22/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
(4)
|
|
|
|
|
|
|
21.65
|
|
|
|
4/20/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
34,000
|
(5)
|
|
|
586,160
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
42,500
|
(5)
|
|
|
732,700
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47,500
|
(6)
|
|
|
818,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
(7)
|
|
|
862,000
|
|
Alberto R. Santa Ines
|
|
|
37,432
|
|
|
|
|
|
|
|
3.00
|
|
|
|
7/23/2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,000
|
|
|
|
|
|
|
|
3.85
|
|
|
|
4/22/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,000
|
(4)
|
|
|
|
|
|
|
21.65
|
|
|
|
4/20/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,000
|
(5)
|
|
|
293,080
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,000
|
(6)
|
|
|
327,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
(7)
|
|
|
344,800
|
|
Kenneth P. Aron, Ph.D.
|
|
|
3,109
|
|
|
|
|
|
|
|
7.5625
|
|
|
|
2/7/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50,000
|
|
|
|
|
|
|
|
6.31
|
|
|
|
10/31/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,500
|
|
|
|
|
|
|
|
5.47
|
|
|
|
7/24/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,000
|
(4)
|
|
|
|
|
|
|
21.65
|
|
|
|
4/20/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,000
|
(5)
|
|
|
293,080
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,000
|
(6)
|
|
|
327,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
(7)
|
|
|
344,800
|
|
Vladimir E. Ostoich, Ph.D.
|
|
|
16,000
|
|
|
|
|
|
|
|
8.125
|
|
|
|
1/25/2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,500
|
|
|
|
|
|
|
|
5.47
|
|
|
|
7/24/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,000
|
|
|
|
|
|
|
|
3.85
|
|
|
|
4/22/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,000
|
(4)
|
|
|
|
|
|
|
21.65
|
|
|
|
4/20/2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,000
|
(5)
|
|
|
293,080
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,000
|
(6)
|
|
|
327,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
(7)
|
|
|
344,800
|
|
Martin V. Mulroy
|
|
|
437
|
|
|
|
|
|
|
|
6.0625
|
|
|
|
1/2/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,812
|
|
|
|
|
|
|
|
4.87
|
|
|
|
4/24/2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,000
|
|
|
|
|
|
|
|
3.85
|
|
|
|
4/22/2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,292
|
|
|
|
|
|
|
|
14.05
|
|
|
|
1/3/2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,000
|
(5)
|
|
|
293,080
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,000
|
(6)
|
|
|
327,560
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,000
|
(7)
|
|
|
344,800
|
|
|
|
|
(1)
|
|
Options granted to the Named Executive Officers expire ten years
after the grant date. All options vest one-fourth on the first
anniversary date of grant and vests at a rate of 1/48th for each
full month thereafter, except as otherwise noted.
|
|
(2)
|
|
Represents the fair value of our common stock on the grant date
of the option.
|
|
(3)
|
|
The value of the equity award is based on the closing price of
our common stock of $17.24 on March 31, 2009, as reported
on the NASDAQ Global Select Market.
|
|
(4)
|
|
These options were accelerated in full by our Board of Directors
and became fully vested on December 5, 2005. However,
pursuant to a
lock-up
and
consent agreement entered into with each of our Named Executive
Officers, these options may not be exercised prior to the date
on which the exercise would have been permitted under the
|
30
|
|
|
|
|
vesting schedule set forth in footnote 1, or earlier upon the
Named Executive Officers last day of employment or a
change in control. On April 20, 2008, the restrictions
under the
lock-up
and
consent agreements expired and 100% of these shares became
exercisable.
|
|
(5)
|
|
The four-year time-based vesting terms of the restricted stock
units is as follows, assuming continuous employment: five
percent of the shares vest on April 25, 2007; ten percent
of the shares vest on April 25, 2008; 15 percent of
the shares vest on April 25, 2009; and 70 percent of
the shares vest on April 25, 2010. Additionally, these
restricted stock unit awards are also subject to accelerated
vesting upon achieving the following performance-based
milestones:
|
|
|
|
upon attainment of certain pre-tax income goals by
March 31, 2007, vesting will accelerate to an aggregate of
25% within one year from grant date; by March 31, 2008,
vesting will accelerate to an aggregate of 25% within two years
from grant date; by March 31, 2009, vesting will accelerate
to an aggregate of 30%, within three years of grant date; hence,
meeting pre-tax income goals in each of the fiscal years ended
March 31, 2007, 2008 and 2009 can result in a cumulative
vesting of 80% over three years;
|
|
|
|
upon attainment of certain product development
objectives prior to June 30, 2007, an additional vesting of
10% would be awarded;
|
|
|
|
upon satisfaction of certain regulatory requirements
prior to March 31, 2008, an additional vesting of 10% would
be awarded; or
|
|
|
|
upon attainment of a certain level of operating
income per share for any fiscal year during the four-year
vesting period, the restricted stock units will accelerate in
full.
|
|
|
|
To date, none of the foregoing performance-based milestones
required for acceleration has been achieved. In each case,
vesting of the equity award is conditioned upon the Named
Executive Officers continuous employment through the
applicable vesting date.
|
|
(6)
|
|
The four-year time-based vesting terms of the restricted stock
units is as follows, assuming continuous employment: five
percent of the shares vest on April 30, 2008; ten percent
of the shares vest on April 30, 2009; 15 percent of
the shares vest on April 30, 2010; and 70 percent of
the shares vest on April 30, 2011.
|
|
(7)
|
|
The four-year time-based vesting terms of the restricted stock
units is as follows, assuming continuous employment: five
percent of the shares vest on May 5, 2009; ten percent of
the shares vest on May 5, 2010; 15 percent of the
shares vest on May 5, 2011; and 70 percent of the
shares vest on May 5, 2012.
|
Option
Exercises and Stock Vested in Fiscal 2009
The following table shows all shares of common stock acquired
upon exercise of stock options and value realized upon exercise,
and all stock awards vested and value realized upon vesting,
held by our Named Executive Officers during fiscal 2009.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards
|
|
|
Stock Awards
|
|
|
|
Number of
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
Shares
|
|
|
Value
|
|
|
Shares
|
|
|
Value
|
|
|
|
Acquired on
|
|
|
Realized on
|
|
|
Acquired on
|
|
|
Realized on
|
|
|
|
Exercise
|
|
|
Exercise
|
|
|
Vesting
|
|
|
Vesting
|
|
Name
|
|
(#)
|
|
|
($)(1)
|
|
|
(#)
|
|
|
($)(2)
|
|
|
Clinton H. Severson
|
|
|
70,000
|
|
|
|
893,394
|
|
|
|
11,500
|
|
|
|
287,500
|
|
Alberto R. Santa Ines
|
|
|
|
|
|
|
|
|
|
|
3,000
|
|
|
|
75,000
|
|
Kenneth P. Aron, Ph.D.
|
|
|
|
|
|
|
|
|
|
|
3,000
|
|
|
|
75,000
|
|
Vladimir E. Ostoich, Ph.D.
|
|
|
50,000
|
|
|
|
723,625
|
|
|
|
3,000
|
|
|
|
75,000
|
|
Martin V. Mulroy
|
|
|
400
|
|
|
|
5,233
|
|
|
|
3,000
|
|
|
|
75,000
|
|
|
|
|
(1)
|
|
The value realized equals the difference between the option
exercise price and the fair market value of our common stock on
the date of exercise, as reported on the NASDAQ Global Market,
multiplied by the number of shares for which the option was
exercised.
|
|
(2)
|
|
The value realized on vesting of restricted stock units equals
the fair market value of our common stock on the settlement
date, multiplied by the number of shares that vested.
|
31
Severance
and Change in Control Agreements
Employment
Agreement
In August 2005, we entered into an employment agreement with
Clinton H. Severson, our President and Chief Executive Officer,
which provides Mr. Severson with a severance payment equal
to two years of salary, bonus and benefits if his employment
with us is terminated for any reason other than cause. Certain
severance benefits provided pursuant to the Severance Plan
(described below in Executive Change of Control Severance
Plan) with respect to a change of control supersede those
provided pursuant to the employment agreement. None of our other
executives have employment agreements with us.
Executive
Change of Control Severance Plan
In July 2006, our Board of Directors, after considering a change
of control program analysis from the Compensation Peer Group
prepared by Top Five and upon the recommendation of our
Compensation Committee, approved and adopted the Abaxis, Inc.
Executive Change of Control Severance Plan (the Severance
Plan). The Severance Plan was adopted by our Board of
Directors to reduce the distraction of executives and potential
loss of executive talent that could arise from a potential
change of control. Participants in the Severance Plan include
Abaxis senior managers who are selected by the Board of
Directors. In December 2008, our Board of Directors amended the
Severance Plan to ensure its compliance with Section 409A
of the Code and designated the following current executive
officers as participants in the Severance Plan: Clinton H.
Severson, our Chairman, President and Chief Executive Officer;
Alberto R. Santa Ines, our Chief Financial Officer and Vice
President of Finance; Kenneth P. Aron, Ph.D., our Chief
Technology Officer; Vladimir E. Ostoich, Ph.D., our Vice
President of Government Affairs and Vice President of Marketing
for the Pacific Rim; Donald P. Wood, our Chief Operations
Officer; and Martin V. Mulroy, our Vice President of Veterinary
Sales and Marketing for North America.
The Severance Plan provides that upon the occurrence of a change
of control a participants outstanding stock option(s) and
other unvested equity-based instruments will accelerate in full,
and any such stock awards shall become immediately exercisable.
In addition, the Severance Plan provides that, if the
participants employment is terminated by us (or any
successor of Abaxis) for any reason other than cause, death, or
disability within 18 months following the change of control
date and such termination constitutes a separation in service,
the participant is eligible to receive severance benefits as
follows:
|
|
|
|
|
on the 60th day after the termination date, a lump sum cash
payment equal to two times the sum of the participants
annual base salary and the participants target annual
bonus amount for the year in which the change of control occurs;
|
|
|
|
payment of up to 24 months of premiums for medical, dental
and vision benefits, provided, however, that if the participant
becomes eligible to receive comparable benefits under another
employers plan, the Companys benefits shall be
secondary to those provided under such other plan;
|
|
|
|
reimbursement, on a monthly basis, of up to 24 months of
premiums for disability and life insurance benefits if the
participant elects to convert his or her disability
and/or
life
insurance benefits under the Companys plans into
individual policies following termination; and
|
|
|
|
payment of an amount equal to any excise tax imposed under
Section 4999 of the Code, provided, however, that payment
of such amount is capped at $1,000,000 per participant.
|
Payment of the foregoing severance benefits is conditioned upon
the participants execution of a valid and effective
release of claims against us.
Incentive
Plans
Under our 2005 Equity Incentive Plan, (the 2005
Plan), in the event of a change in control, as
such term is defined by the 2005 Plan, the surviving,
continuing, successor or purchasing entity or its parent may,
without the consent of any participant, either assume or
continue in effect any or all outstanding options and stock
appreciation
32
rights or substitute substantially equivalent options or rights
for its stock. Any options or stock appreciation rights which
are not assumed or continued in connection with a change in
control or exercised prior to the change in control will
terminate effective as of the time of the change in control. Our
Compensation Committee may provide for the acceleration of
vesting of any or all outstanding options or stock appreciation
rights upon such terms and to such extent as it determines. The
2005 Plan also authorizes our Compensation Committee, in its
discretion and without the consent of any participant, to cancel
each or any outstanding option or stock appreciation right upon
a change in control in exchange for a payment to the participant
with respect to each vested share (and each unvested share if so
determined by our Compensation Committee) subject to the
cancelled award of an amount equal to the excess of the
consideration to be paid per share of common stock in the change
in control transaction over the exercise price per share under
the award. The Compensation Committee, in its discretion, may
provide in the event of a change in control for the acceleration
of vesting
and/or
settlement of any stock award, restricted stock unit award,
performance share or performance unit, cash-based award or other
share-based award held by a participant upon such conditions and
to such extent as determined by our Compensation Committee. It
is currently anticipated that awards granted to executive
officers will accelerate fully on a change of control. The
vesting of non-employee director awards granted under the 2005
Plan automatically will accelerate in full upon a change in
control.
All outstanding stock options under our 1992 Outside
Directors Stock Option Plan (the Directors
Plan) are fully vested and no additional options will be
granted under the Directors Plan. Our Directors Plan provides
that, in the event of a transfer of control of the company, the
surviving, continuing, successor or purchasing corporation or a
parent corporation thereof, as the case may be, shall either
assume our rights and obligations under stock option agreements
outstanding under our option plans or substitute options for the
acquiring corporations stock for such outstanding options.
Any options which are neither assumed by the acquiring
corporation, nor exercised as of the date of the transfer of
control, shall terminate effective as of the date of the
transfer of control.
As described above, certain additional compensation is payable
to a Named Executive Officer (i) if his employment was
involuntarily terminated without cause, (ii) upon a change
in control or (iii) if his employment was terminated
involuntarily following a change in control. The amounts shown
in the table below assume that such termination was effective as
of March 31, 2009, and do not include amounts in which the
Named Executive Officer had already vested as of March 31,
2009. The actual compensation to be paid can only be determined
at the time of the change in control
and/or
a
Named Executive Officers termination of employment.
Potential
Payments Upon Termination or Change in Control
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Involuntary
|
|
|
|
Involuntary
|
|
|
|
|
|
Termination Without
|
|
|
|
Termination Without
|
|
|
Change in Control
|
|
|
Cause Following a
|
|
Executive Benefits and Payments Upon Separation
|
|
Cause(1)
|
|
|
(No Termination)
|
|
|
Change In Control(2)
|
|
|
Clinton H. Severson
|
|
|
|
|
|
|
|
|
|
|
|
|
Salary and bonus
|
|
$
|
1,853,077
|
|
|
|
|
|
|
$
|
1,853,077
|
|
Vesting of restricted stock units(3)
|
|
$
|
2,999,760
|
|
|
$
|
2,999,760
|
|
|
$
|
2,999,760
|
|
Health and welfare benefits(4)
|
|
$
|
11,852
|
|
|
|
|
|
|
$
|
11,852
|
|
Total
|
|
$
|
4,864,689
|
|
|
$
|
2,999,760
|
|
|
$
|
4,864,689
|
|
Alberto R. Santa Ines
|
|
|
|
|
|
|
|
|
|
|
|
|
Salary and bonus
|
|
|
|
|
|
|
|
|
|
$
|
1,046,154
|
|
Vesting of restricted stock units(3)
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
965,440
|
|
Health and welfare benefits(4)
|
|
|
|
|
|
|
|
|
|
$
|
11,128
|
|
Excise tax reimbursement(5)
|
|
|
|
|
|
|
|
|
|
$
|
101,339
|
|
Total
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
2,124,061
|
|
Kenneth P. Aron, Ph.D.
|
|
|
|
|
|
|
|
|
|
|
|
|
Salary and bonus
|
|
|
|
|
|
|
|
|
|
$
|
1,068,462
|
|
Vesting of restricted stock units(3)
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
965,440
|
|
Health and welfare benefits(4)
|
|
|
|
|
|
|
|
|
|
$
|
31,824
|
|
Total
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
2,065,726
|
|
33
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Involuntary
|
|
|
|
Involuntary
|
|
|
|
|
|
Termination Without
|
|
|
|
Termination Without
|
|
|
Change in Control
|
|
|
Cause Following a
|
|
Executive Benefits and Payments Upon Separation
|
|
Cause(1)
|
|
|
(No Termination)
|
|
|
Change In Control(2)
|
|
|
Vladimir E. Ostoich, Ph.D.
|
|
|
|
|
|
|
|
|
|
|
|
|
Salary and bonus
|
|
|
|
|
|
|
|
|
|
$
|
1,068,462
|
|
Vesting of restricted stock units(3)
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
965,440
|
|
Health and welfare benefits(4)
|
|
|
|
|
|
|
|
|
|
$
|
23,104
|
|
Total
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
2,057,006
|
|
Martin V. Mulroy
|
|
|
|
|
|
|
|
|
|
|
|
|
Salary and bonus
|
|
|
|
|
|
|
|
|
|
$
|
962,692
|
|
Vesting of restricted stock units(3)
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
965,440
|
|
Health and welfare benefits(4)
|
|
|
|
|
|
|
|
|
|
$
|
10,992
|
|
Excise tax reimbursement(5)
|
|
|
|
|
|
|
|
|
|
$
|
189,652
|
|
Total
|
|
|
|
|
|
$
|
965,440
|
|
|
$
|
2,128,776
|
|
|
|
|
(1)
|
|
Amounts relate to payments to Mr. Severson equal to two
years of salary, bonus and benefits if his employment with us is
terminated for any reason other than cause (as defined in
Mr. Seversons employment agreement).
|
|
(2)
|
|
Amounts assume that the Named Executive Officer was terminated
without cause or due to constructive termination during the
18-month
period following a change in control.
|
|
(3)
|
|
The value of the restricted stock unit assumes that the market
price per share of our common stock on the date of termination
of employment was equal to the closing price of our common stock
of $17.24 on March 31, 2009, as reported on the NASDAQ
Global Select Market.
|
|
(4)
|
|
Health and welfare benefits includes payment of 24 months
of premiums for medical, dental, vision, disability and life
insurance benefits.
|
|
(5)
|
|
For purposes of computing the excise tax reimbursement payments,
base amount calculations are based on the Named Executive
Officers taxable wages for the fiscal years 2004 through
2009.
|
DIRECTOR
COMPENSATION
Director
Compensation Table
The table below summarizes the compensation paid to our
non-employee directors for fiscal 2009.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees Earned or
|
|
|
Stock
|
|
|
Option
|
|
|
All Other
|
|
|
|
|
|
|
Paid in Cash
|
|
|
Awards
|
|
|
Awards
|
|
|
Compensation
|
|
|
Total
|
|
Name(1)
|
|
($)
|
|
|
($)(2)(3)(4)
|
|
|
($)(5)
|
|
|
($)
|
|
|
($)
|
|
|
Richard J. Bastiani, Ph.D.
|
|
|
24,000
|
|
|
|
36,346
|
|
|
|
|
|
|
|
|
|
|
|
60,346
|
|
Henk J. Evenhuis
|
|
|
28,250
|
|
|
|
36,346
|
|
|
|
|
|
|
|
|
|
|
|
64,596
|
|
Brenton G. A. Hanlon*
|
|
|
24,000
|
|
|
|
36,346
|
|
|
|
|
|
|
|
|
|
|
|
60,346
|
|
Prithipal Singh, Ph.D.
|
|
|
21,250
|
|
|
|
36,346
|
|
|
|
|
|
|
|
|
|
|
|
57,596
|
|
Ernest S. Tucker, III, M.D.
|
|
|
23,250
|
|
|
|
36,346
|
|
|
|
|
|
|
|
|
|
|
|
59,596
|
|
|
|
|
*
|
|
Mr. Hanlon resigned from the Companys Board of
Directors as of August 10, 2009.
|
|
(1)
|
|
Clinton H. Severson, our Chief Executive Officer and Director,
is not included in this table as he is an employee of the
Company and receives no compensation for his services as a
director. The compensation received by Mr. Severson as an
employee is shown in the Summary Compensation Table
above.
|
|
(2)
|
|
Amounts listed in this column represent our accounting expense
for these awards, over the requisite service period, in
accordance with SFAS No. 123(R). For a discussion of
the assumptions used in determining the fair value of awards of
restricted stock units in the above table, see Note 11 of
the Notes to Consolidated Financial Statements in our Annual
Report on
Form 10-K
filed with the SEC on June 12, 2009. Restricted stock units
were
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34
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granted to non-employee directors starting in fiscal 2007. No
stock awards were forfeited by any of our non-employee directors
during fiscal 2009.
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(3)
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Each non-employee director listed in the table above was granted
an award of 1,500 restricted stock units on May 5, 2008
under our 2005 Plan. The grant date fair value, as determined in
accordance with SFAS No. 123(R), of the restricted
stock units granted during fiscal 2009 for each of the directors
listed in the table above was $37,500.
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(4)
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As of March 31, 2009, each of our non-employee directors
held 1,500 shares of unvested restricted stock units.
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(5)
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No options were awarded to our non-employee directors in fiscal
2009, 2008 or 2007. As of March 31, 2009, the non-employee
directors held the following number of outstanding options:
Dr. Bastiani, 24,000; Mr. Evenhuis, 18,000;
Mr. Hanlon, 16,000; Dr. Singh, 22,000; and
Dr. Tucker, 13,000 shares.
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Cash
Compensation Paid to Board Members
During fiscal 2009, all non-employee directors received an
annual retainer of $12,000. The non-employee Chairs of our Audit
Committee and Compensation Committee received an annual
supplement of $5,000 and $2,000, respectively. Our non-employee
directors each received $1,250 per board meeting attended and
$1,000 per committee meeting attended. We also reimburse our
non-employee directors for reasonable travel expenses incurred
in connection with attending board and committee meetings.
Directors who are employees receive no compensation for their
service as directors.
Equity
Compensation Paid to Board Members
Non-employee directors are eligible to receive awards under the
2005 Plan, but such awards are discretionary and not automatic.
In fiscal 2009, 2008 and 2007, each non-employee director
received an annual equity award of 1,500 restricted stock units
granted under the 2005 Plan. Each award of restricted stock
units represents the right of the participant to receive,
without payment of monetary consideration, on the vesting date,
a number of shares of common stock equal to the number of units
vesting on such date. Subject to the directors continued
service with us through the applicable vesting date, each
restricted stock unit award will vest in full 12 months
after the grant date. Under the terms of the 2005 Plan, the
vesting of each non-employee director restricted stock unit
award will also be accelerated in full in the event of a
change in control, as defined in the 2005 Plan.
TRANSACTIONS
WITH RELATED PERSONS
Certain
Relationships and Related Transactions
During the fiscal year ended March 31, 2009 and as of the
date hereof, there was not, nor is there any currently proposed
transaction or series of similar transactions to which the
Company was or is to be a party in which the amount involved
exceeds $120,000 and in which any executive officer, director or
holder of more than 5% of any class of voting securities of the
Company and members of that persons immediate family had
or will have a direct or indirect material interest, other than
as set forth in the Summary Compensation Table above.
Indemnification
Agreements
The Company has entered into indemnity agreements with certain
officers and directors which provide, among other things, that
the Company will indemnify such officer or director, under the
circumstances and to the extent provided for therein, for
expenses, damages, judgments, fines and settlements he or she
may be required to pay in actions or proceedings which he or she
is or may be made a party by reason of his or her position as a
director, officer or other agent of the Company, and otherwise
to the fullest extent permitted under applicable law.
Related-Person
Transactions Policy and Procedures
Pursuant to the requirements set forth in the charter of the
Companys Audit Committee, the Audit Committee is
responsible for reviewing and approving any related-party
transactions, after reviewing each such transaction for
potential conflicts of interests and other improprieties. The
Company does not have any additional written
35
procedures governing the process for addressing related-person
transactions. However, in approving or rejecting proposed
transactions, the Audit Committee generally considers the
relevant facts and circumstances available and deemed relevant,
including, but not limited to the risks, costs and benefits to
the Company, the terms of the transaction, the availability of
other sources for comparable services or products, and, if
applicable, the impact on a directors independence.
As required under the Nasdaq listing standards, a majority of
the members of a listed companys Board of Directors must
qualify as independent, as affirmatively determined
by the Board of Directors. The Board consults with the
Companys counsel to ensure that the Boards
determinations are consistent with relevant securities and other
laws and regulations regarding the definition of
independent, including those set forth in the Nasdaq
listing standards, as in effect time to time. Consistent with
these considerations, after review of all relevant transactions
or relationships between each director, or any of his or her
family members, and the Company, its senior management and its
independent auditors, the Board has affirmatively determined
that each of the following directors are independent directors
within the meaning of the applicable Nasdaq listing standards:
Mr. Evenhuis, Dr. Bastiani, Dr. Singh and
Dr. Tucker. In addition, the Board previously determined
that Mr. Hanlon, who resigned from the Board of Directors
as of August 10, 2009, was an independent director within
the meaning of the applicable Nasdaq listing standards prior to
such resignation. In making this determination, the Board found
that none of these current or former directors or nominees for
director had a material or other disqualifying relationship with
the Company. Mr. Severson, the Companys Chairman,
President and Chief Executive Officer, is not an independent
director by virtue of his employment with the Company.
HOUSEHOLDING
OF PROXY MATERIALS
The SEC has adopted rules that permit companies and
intermediaries (e.g., brokers) to satisfy the delivery
requirements for annual meeting materials with respect to two or
more shareholders sharing the same address by delivering a
single set of annual meeting materials addressed to those
shareholders. This process, which is commonly referred to as
householding, potentially means extra convenience
for shareholders and cost savings for companies.
This year, a number of brokers with account holders who are
Abaxis shareholders may be householding proxy
materials. A single set of annual meeting materials may be
delivered to multiple shareholders sharing an address unless
contrary instructions have been received from the affected
shareholders. Once you have received notice from your broker
that they will be householding communications to
your address, householding will continue until you
are notified otherwise or until you revoke your consent. If, at
any time, you no longer wish to participate in
householding and would prefer to receive a separate
set of annual meeting materials, please notify your broker.
Direct your written request to Abaxis, Inc., Alberto R. Santa
Ines, Chief Financial Officer and Secretary, 3240 Whipple Road,
Union City, California 94587 or contact Alberto R. Santa Ines at
1-510-675-6500. Shareholders who currently receive multiple
copies of the annual meeting materials at their addresses and
would like to request householding of their
communications should contact their brokers.
36
OTHER
MATTERS
The Board of Directors knows of no other matters that will be
presented for consideration at the Annual Meeting. If any other
matters are properly brought before the meeting, it is the
intention of the persons named in the accompanying proxy to vote
on such matters in accordance with their best judgment.
By Order of the Board of Directors
ALBERTO R. SANTA INES
Chief Financial Officer and Secretary
September 17, 2009
A copy of the Companys Annual Report to the Securities and
Exchange Commission on
Form 10-K
for the fiscal year ended March 31, 2009 is available
without charge upon written request to: Investor Relations,
Abaxis, Inc., 3240 Whipple Road, Union City, California 94587.
37
Electronic Voting Instructions
You can vote by Internet or telephone!
Available 24 hours a day, 7 days a week!
Instead of mailing your proxy, you may choose one of the two voting methods outlined below to vote your proxy.
VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.
Proxies submitted by the Internet or telephone must be received by 1:00 a.m., Central Time, on October 28, 2009.
Vote by Internet
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Log on to the Internet and go to
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www.investorvote.com/ABAX
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Follow the steps outlined on the
secured website.
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Vote by telephone
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Call toll free 1-800-652-VOTE
(8683) within the USA,
US territories & Canada any
time on a touch tone
telephone. There is NO
CHARGE to you for the call.
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Follow the instructions
provided by the recorded message.
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Using a
black ink
pen, mark your votes with an X as shown in
this example. Please do not write outside the designated areas.
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x
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Annual Meeting Proxy Card
IF YOU HAVE NOT VOTED VIA THE INTERNET
OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH
AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
A
Proposals The Board of Directors recommends a vote
FOR
all the nominees listed and
FOR
Proposal 2.
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1. Election of Directors:
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For
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Withhold
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For
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Withhold
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For
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Withhold
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01 - Clinton H. Severson *
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o
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o
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02 - Richard J. Bastiani, Ph.D. *
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o
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o
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03 - Henk J. Evenhuis *
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o
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o
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04 - Prithipal Singh, Ph.D. *
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o
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o
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05 - Ernest S. Tucker III, M.D. *
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o
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o
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* each to serve until the 2010 Annual Meeting of Shareholders or until their respective
successors are elected and qualified.
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For
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Against
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Abstain
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2. To ratify the appointment of Burr, Pilger & Mayer LLP as the
independent registered public accounting firm of Abaxis, Inc.
for the fiscal year ending March 31, 2010.
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o
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o
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o
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B
Non-Voting Items
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Change of Address
Please print your new address below.
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Comments
Please print your comments below.
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Meeting Attendance
Mark the box to the right
if you plan to attend the
Annual Meeting.
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o
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C
Authorized Signatures This section must be completed for your vote to be counted. Date and Sign Below
Please sign here exactly as your name(s) appears on your stock certificate. If shares of
stock are held jointly, both or all of such persons should sign. Corporate or partnership
proxies should be signed in full corporate name by an authorized person. Persons signing
in a fiduciary capacity should indicate their full titles in such capacity. Please date
the Proxy.
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Date (mm/dd/yyyy) Please print date below.
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Signature 1 Please keep signature within the box.
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Signature 2 Please keep signature within the box.
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013BUB
IF YOU HAVE NOT VOTED VIA THE INTERNET
OR
TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.
Proxy Abaxis, Inc.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON OCTOBER 28, 2009
SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints Clinton H. Severson and Alberto R. Santa Ines, and each of
them, with full power of substitution, to represent the undersigned and to vote all of the shares of stock in
Abaxis, Inc. a California corporation, which the undersigned is entitled
to vote at the Annual Meeting of Shareholders of Abaxis to be held at the principal offices
of Abaxis at 3240 Whipple Road, Union City, California 94587, on Wednesday, October 28,
2009, at 10:00 a.m. local time, and at any adjournment or postponement thereof (1) as
hereinafter specified upon the proposals listed on the reverse side and as more particularly
described in the Proxy Statement for the 2009 Annual Meeting of Abaxis Shareholders (the
Proxy Statement), receipt of which is hereby acknowledged, and (2) in their discretion
upon such other matters as may properly come before the meeting.
THE SHARES REPRESENTED HEREBY SHALL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS MADE,
SUCH SHARES SHALL BE VOTED FOR ALL NOMINEES UNDER PROPOSAL 1 AND FOR PROPOSAL 2.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, YOU ARE URGED TO SIGN AND
PROMPTLY MAIL THIS PROXY IN THE RETURN ENVELOPE SO THAT YOUR STOCK MAY BE REPRESENTED AT
THE MEETING.
Abaxis, Inc. (delisted) (NASDAQ:ABAX)
과거 데이터 주식 차트
부터 9월(9) 2024 으로 10월(10) 2024
Abaxis, Inc. (delisted) (NASDAQ:ABAX)
과거 데이터 주식 차트
부터 10월(10) 2023 으로 10월(10) 2024