<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
BOLDER TECHNOLOGIES CORPORATION
-----------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
--------------------------------------------------------------------
2. Aggregate number of securities to which transaction applies:
--------------------------------------------------------------------
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
--------------------------------------------------------------------
4. Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------
5. Total fee paid:
--------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1. Amount Previously Paid:
--------------------------------------------------------------------
2. Form, Schedule or Registration Statement No.:
--------------------------------------------------------------------
3. Filing Party:
--------------------------------------------------------------------
4. Date Filed:
--------------------------------------------------------------------
<PAGE> 2
BOLDER TECHNOLOGIES CORPORATION
5181 Ward Road
Wheat Ridge, Colorado 80033
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 5, 1997
TO THE STOCKHOLDERS OF BOLDER TECHNOLOGIES CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
BOLDER TECHNOLOGIES CORPORATION, a Delaware corporation (the "Company"), will
be held on Thursday, June 5, 1997, at 10:00 a.m. local time, at the Company's
facilities located at 4403 Table Mountain Parkway, Golden, Colorado 80403 for
the following purposes:
1. To elect two Class I Directors to hold office until the 2000
Annual Meeting of Stockholders.
2. To approve the Company's 1996 Equity Incentive Plan, as
amended, to increase the aggregate number of shares of Common
Stock authorized for issuance thereunder by 633,334 shares and
to add provisions with respect to Section 162(m) of the
Internal Revenue Code of 1986, as amended.
3. To ratify the selection of Arthur Andersen LLP as independent
accountants of the Company for the fiscal year ending December
31, 1997.
4. To transact such other business as may properly come before
the meeting or any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
The Board of Directors has fixed the close of business on April 17,
1997, as the record date for the determination of stockholders entitled to
notice of and to vote at this Annual Meeting and at any adjournment or
postponement thereof.
By Order of the Board of Directors,
/s/ Joseph F. Fojtasek
Joseph F. Fojtasek, Secretary
Wheat Ridge, Colorado
April 29, 1997
ALL STOCKHOLDERS 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 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 THAT PURPOSE. EVEN IF
YOU HAVE GIVEN YOUR 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 FROM THE RECORD HOLDER A PROXY ISSUED IN YOUR NAME.
<PAGE> 3
BOLDER TECHNOLOGIES CORPORATION
5181 Ward Road
Wheat Ridge, Colorado 80033
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 5, 1997
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of
Bolder Technologies Corporation, a Delaware corporation ("Bolder" or the
"Company"), for use at the Annual Meeting of Stockholders to be held on
Thursday, June 5, 1997, at 10:00 a.m. local time (the "Annual Meeting"), and at
any adjournment or postponement thereof, for the purposes set forth herein and
in the accompanying Notice of Annual Meeting. The Annual Meeting will be held
at the Company's facilities located at 4403 Table Mountain Parkway, Golden,
Colorado 80403. The Company intends to mail this Proxy Statement and
accompanying proxy card on or about April 29, 1997, to all stockholders
entitled to vote at the Annual Meeting.
SOLICITATION
The Company will bear the entire cost of solicitation of proxies,
including preparation, assembly, printing and mailing of this Proxy Statement,
the proxy and any additional information furnished to stockholders. Copies of
solicitation materials will be furnished to banks, brokerage houses,
fiduciaries and custodians holding in their names shares of Common Stock
beneficially owned by others to forward to such beneficial owners. The Company
may reimburse persons representing beneficial owners of Common Stock for their
costs of forwarding solicitation materials to such beneficial owners. Original
solicitation of proxies by mail may be supplemented by telephone, telegram or
personal solicitation by directors, officers or other regular employees of the
Company. No additional compensation will be paid to directors, officers or
other regular employees for such services.
VOTING RIGHTS AND OUTSTANDING SHARES
Only holders of record of Common Stock at the close of business on
April 17, 1997 will be entitled to notice of and to vote at the Annual Meeting.
At the close of business on April 17, 1997, the Company had outstanding and
entitled to vote 9,429,874 shares of Common Stock.
Each holder of record of Common Stock on such date will be entitled to
one vote for each share held on all matters to be voted upon at the Annual
Meeting.
All votes will be tabulated by the inspector of elections appointed
for the meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions and broker non-votes will be
considered present at the Annual Meeting for the purpose of establishing a
quorum.
With regard to election of Class I Directors, votes may be cast in
favor or withheld; votes that are withheld will be excluded entirely from the
vote and will have no effect.
Abstentions may be specified on the proposals to approve the 1996
Equity Incentive Plan and to ratify the Company's auditors. Abstentions on the
proposal to ratify the Company's auditors will have no effect. Abstentions on
the proposal to approve the 1996 Equity Incentive Plan will have the effect of
a negative vote.
1
<PAGE> 4
Brokerage firms who hold shares in "street name" for customers have
the authority to vote those shares with respect to the election of directors
and the ratification of the appointment of the Company's auditors if such firms
have not received voting instructions from a beneficial owner. Brokers will
not have authority to vote shares with respect to the proposal to approve the
1996 Equity Incentive Plan. The failure of a broker to vote shares in the
absence of instructions (a "broker non-vote") will have the effect of a vote
against the proposal to approve the 1996 Equity Incentive Plan; broker
non-votes will have no effect with respect to any other matter considered at
the Annual Meeting.
REVOCABILITY OF PROXIES
Any person giving a proxy pursuant to this solicitation has the power
to revoke it at any time before it is voted. It may be revoked by filing with
the Secretary of the Company at the Company's principal executive office, 5181
Ward Road, Wheat Ridge, Colorado 80033, a written notice of revocation or a
duly executed proxy bearing a later date, or it may be revoked by attending the
meeting and voting in person. Attendance at the meeting will not, by itself,
revoke a proxy.
STOCKHOLDER PROPOSALS
Proposals of stockholders that are intended to be presented at the
Company's 1998 Annual Meeting of Stockholders must be received by the Company
not later than December 30, 1997 in order to be included in the proxy statement
and proxy relating to that Annual Meeting.
2
<PAGE> 5
PROPOSAL 1
ELECTION OF CLASS I DIRECTORS
The Company's Certificate of Incorporation and Bylaws provide that the
Board of Directors shall be divided into three classes, each class consisting,
as nearly as possible, of one-third of the total number of directors, with each
class having a three-year term. Vacancies on the Board may be filled only by
persons elected by a majority of the remaining directors. A director elected
by the Board to fill a vacancy (including a vacancy created by an increase in
the Board of Directors) shall serve for the remainder of the full term of the
class of Directors in which the vacancy occurred and until such director's
successor is elected and qualified.
The Board of Directors is presently composed of five members and there
is one vacancy. There are two Class I Directors, whose term of office expires
in 1997. Each of the nominees for election to this class is currently a
director of the Company who was previously elected by the stockholders. If
elected at the Annual Meeting, each of the nominees would serve until the 2000
annual meeting and until his successor is elected and qualified, or until such
director's earlier death, resignation or removal.
Directors are elected by a plurality of the votes present in person or
represented by proxy and entitled to vote at the meeting. Shares represented
by executed proxies will be voted, if authority to do so is not withheld, for
the election of the two nominees named below. In the event that any nominee
should be unavailable for election as a result of an unexpected occurrence,
such shares will be voted for the election of such substitute nominee as
management may propose. Each person nominated for election has agreed to serve
if elected, and management has no reason to believe that any nominee will be
unable to serve.
Set below is biographical information for each person nominated to
serve on the Board of Directors and each person whose term of office as a
director will continue after the Annual Meeting.
<TABLE>
<CAPTION>
NAME AGE CLASS
---- --- -----
<S> <C> <C>
Wilmer R. Bottoms, Ph.D.(1)(2) 54 Class II Director
Tristan E. Juergens 52 Class III Director
Daniel S. Lankford 51 Class I Director
David L. Riegel (1)(2) 59 Class I Director
Carl S. Stutts (1)(2) 50 Class II Director
</TABLE>
- ------------------------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
NOMINEES FOR ELECTION FOR A THREE-YEAR TERM EXPIRING AT THE 2000 ANNUAL MEETING
(CLASS I DIRECTORS)
Daniel S. Lankford has served as Chief Executive Officer and President
of Bolder since July 1994 and as Chairman of the Board of Directors since
October 1996. Prior to joining the Company, Mr. Lankford was Chief Executive
Officer of AT&T Microelectronics--Europe from December 1989 to July 1994, and
prior to that, Mr. Lankford served as Vice President of Marketing for AT&T's
worldwide microelectronics unit. He received his M.S. in Management as a Sloan
Fellow from Stanford University and his B.S. from Johns Hopkins University.
Mr. Lankford is a Class I Director.
3
<PAGE> 6
David L. Riegel has been a director at Bolder since 1992. From May
1992 to October 1992 Mr. Riegel served as the Chief Executive Officer of the
Company. Mr. Riegel is the Executive Vice President and Chief Operating
Officer of Exabyte Corporation, a data storage company, a position he has held
since December 1994. From July 1993 to December 1994, Mr. Riegel was Senior
Vice President of Operations at Exabyte. From November 1992 to July 1993, he
was Senior Vice President and Chief Executive Officer of PrairieTek Corp., a
disk drive manufacturer. PrairieTek filed for protection under Chapter 11 of
the Federal bankruptcy laws in August 1991. Mr. Riegel received a B.S. from
Purdue University.
DIRECTORS CONTINUING IN OFFICE UNTIL THE 1998 ANNUAL MEETING (CLASS II
DIRECTORS)
Wilmer R. Bottoms, Ph.D. has been a director at Bolder since 1993.
Since July 1996, Dr. Bottoms has served as Chairman of the Board and Chief
Executive Officer of Credence Systems Corporation. From 1984 to July 1996, Dr.
Bottoms was a Senior Vice President of Patricof & Co. Ventures, Inc. Dr.
Bottoms received a Ph.D. from Tulane University and a B.S. from Huntington
College.
Carl S. Stutts has been a director at Bolder since 1992. Mr. Stutts
is a general partner of Columbine Venture Management II, the general partner of
Columbine Venture Fund II, a position he has held since 1988. Mr. Stutts was a
director of Thesis, Inc., which filed a voluntary petition under Chapter 11 of
the Federal Bankruptcy laws in July 1994. Mr. Stutts received an M.B.A. from
the University of Houston and a B.S. from North Carolina State University.
DIRECTOR CONTINUING IN OFFICE UNTIL THE 1999 ANNUAL MEETING (CLASS III
DIRECTOR)
Tristan E. Juergens is the Company's founder. He has served as a
director at Bolder since 1991. Mr. Juergens served as the Company's Chief
Technical Officer from May 1992 to March 1996. From March 1991 to May 1992, he
served as President of the Company. Mr. Juergens holds a B.S. from the
University of Wisconsin.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF EACH NAMED NOMINEE.
BOARD COMMITTEES AND MEETINGS
During the fiscal year ended December 31, 1996 the Board of Directors
held 19 meetings. The Board has an Audit Committee and a Compensation
Committee.
The Audit Committee meets with the Company's independent accountants
at least annually to review the results of the annual audit and discuss the
financial statements; recommends to the Board the independent accountants to be
retained; and receives and considers the accountants' comments as to controls,
adequacy of staff and management performance and procedures in connection with
audit and financial controls. The Audit Committee is composed of three
non-employee directors: Messrs. Bottoms, Riegel and Stutts. It met once
during the fiscal year ended December 31, 1996.
The Compensation Committee makes recommendations concerning salaries
and incentive compensation, awards stock options to employees and consultants
under the Company's stock option plans and otherwise determines compensation
levels and performs such other functions regarding compensation as the Board
may delegate. The Compensation Committee is composed of three non-employee
directors: Messrs. Bottoms, Riegel and Stutts. It met once during the fiscal
year ended December 31, 1996.
During the fiscal year ended December 31, 1996, each Board member
other than Messrs. Juergens and Riegel attended 75% or more of the meetings of
the Board and of the committees on which he served that were held during the
period(s) for which he served as a director and committee member.
4
<PAGE> 7
PROPOSAL 2
APPROVAL OF 1996 EQUITY INCENTIVE PLAN
In March 1996, the Board of Directors adopted, and the stockholders
subsequently approved, the Company's 1996 Equity Incentive Plan (the "1996
Plan"). At December 31, 1996, there were 1,666,666 shares of the Company's
Common Stock authorized for issuance under the 1996 Plan.
At December 31, 1996, options (net of canceled or expired options)
covering an aggregate of 887,750 shares of the Company's Common Stock had been
granted under the 1996 Plan, and only 193,086 shares (plus any shares that
might in the future be returned to the 1996 Plan as a result of cancellation or
expiration of options) remained available for future grant under the 1996 Plan.
In April 1997, the Board approved an amendment to the 1996 Plan,
subject to stockholder approval, to enhance the flexibility of the Board and
the Compensation Committee in granting stock options to the Company's
employees. The amendment increases the number of shares authorized for
issuance under the 1996 Plan from a total of 1,666,666 shares to 2,300,000
shares. The Board adopted this amendment to ensure that the Company can
continue to grant stock options to employees at levels determined appropriate
by the Board and the Compensation Committee.
In April 1997, the Board also amended the 1996 Plan, subject to
stockholder approval, generally to permit the Company, under Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code"), to continue to be
able to deduct as a business expense certain compensation attributable to the
exercise of stock options granted under the 1996 Plan. Section 162(m) denies a
deduction to any publicly held corporation for certain compensation paid to
specified employees in a taxable year to the extent that the compensation
exceeds $1,000,000 for any covered employee. See "Federal Income Tax
Information" below for a discussion of the application of Section 162(m). In
light of the Section 162(m) requirements, the Board has amended the 1996 Plan,
subject to stockholder approval, to include a limitation providing that no
employee may be granted options under the 1996 Plan during a calendar year to
purchase in excess of 460,000 shares of Common Stock. Previously, no such
formal limitation was placed on the number of shares available for option
grants to an employee. In addition, the 1996 Plan was amended, subject to
stockholder approval, to provide that, in the Board's discretion, directors who
grant options to covered employees generally will be "outside directors" as
defined in Section 162(m). For a description of this requirement, see
"Administration."
Stockholders are requested in this Proposal 2 to approve the 1996
Plan, as amended. If the stockholders fail to approve this Proposal 2, options
granted under the 1996 Plan after the Annual Meeting will not qualify as
performance-based compensation and, in some circumstances, the Company may be
denied a business expense deduction for compensation recognized in connection
with the exercise of these stock options. The affirmative vote of the holders
of a majority of the shares present in person or represented by proxy and
entitled to vote at the meeting will be required to approve the 1996 Plan, as
amended. Abstentions will be counted toward the tabulation of votes cast on
proposals presented to the stockholders and will have the same effect as
negative votes. Broker non-votes will be counted towards a quorum, but 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.
The essential features of the 1996 Plan are outlined below:
GENERAL
The 1996 Plan provides for the grant of both incentive and
nonstatutory stock options. Incentive stock options granted under the 1996
Plan are intended to qualify as "incentive stock options" within the meaning of
Section 422 of the Code. Nonstatutory stock options granted under the 1996
Plan are intended not to qualify as
5
<PAGE> 8
incentive stock options under the Code. See "Federal Income Tax Information"
for a discussion of the tax treatment of incentive and nonstatutory stock
options.
PURPOSE
The 1996 Plan was adopted to provide a means by which selected
officers, directors and employees of and consultants to the Company and its
affiliates could be given an opportunity to purchase stock in the Company, to
assist in retaining the services of employees holding key positions, to secure
and retain the services of persons capable of filling such positions, and to
provide incentives for such persons to exert maximum efforts for the success of
the Company. As of March 31, 1997, all of the Company's approximately 74
employees and consultants are eligible to participate in the 1996 Plan.
ADMINISTRATION
The 1996 Plan is administered by the Board of Directors of the
Company. The Board has the power to construe and interpret the 1996 Plan and,
subject to the provisions of the 1996 Plan, to determine the persons to whom
and the dates on which options will be granted, the number of shares to be
subject to each option, the time or times during the term of each option within
which all or a portion of such option may be exercised, the exercise price, the
type of consideration, and other terms of the option. The Board of Directors
is authorized to delegate administration of the 1996 Plan to a committee
composed of members of the Board.
Proposed regulations under Section 162(m) will require that the
directors who serve as members of the Compensation Committee must be "outside
directors." The 1996 Plan has been amended, subject to stockholder approval,
to provide that, in the Board's discretion, directors serving on the
Compensation Committee will also be "outside directors" within the meaning of
Section 162(m). This limitation would exclude from the Compensation Committee
(i) current employees of the Company, (ii) former employees of the Company
receiving compensation for past services (other than benefits under a
tax-qualified pension plan), (iii) current and former officers of the Company,
(iv) directors currently receiving direct or indirect remuneration from the
Company in any capacity (other than as a director), unless any such person is
otherwise considered an "outside director" for purposes of Section 162(m). The
Company currently intends to monitor the proposed regulations and will
determine at the appropriate time whether to make any change to the composition
of its Compensation Committee if any would be required by the final
regulations.
ELIGIBILITY
Incentive stock options may be granted under the 1996 Plan only to key
employees (including officers) of the Company and its affiliates. Employees
(including officers) and consultants are also eligible to receive nonstatutory
stock options under the 1996 Plan. Non-employee directors are eligible only
for nonstatutory option grants under the 1996 Plan.
No incentive stock option may be granted under the 1996 Plan to any
person who, at the time of the grant, owns (or is deemed to own) stock
possessing more than 10% of the total combined voting power of the Company or
any affiliate of the Company, unless the option exercise price is at least 110%
of the fair market value of the stock subject to the option on the date of
grant, and the term of the option does not exceed five years from the date of
grant. For incentive stock options granted under the 1996 Plan, the aggregate
fair market value, determined at the time of grant, of the shares of Common
Stock with respect to which such options are exercisable for the first time by
an optionee during any calendar year (under all such plans of the Company and
its affiliates) may not exceed $100,000.
Subject to stockholder approval of this Proposal 2, the Company has
added to the 1996 Plan a per-employee, per- calendar year limitation equal to
460,000 shares of Common Stock. The purpose of adding this limitation is
generally to permit the Company to continue to be able to deduct for tax
purposes the compensation attributable to the exercise of options granted under
the 1996 Plan. Previously, the Board or the Compensation
6
<PAGE> 9
Committee determined in its discretion the number of shares subject to an
option for any employee, and no such formal limitation was placed on the number
of shares available for an option to an employee.
STOCK SUBJECT TO THE 1996 PLAN
If options granted under the 1996 Plan expire or otherwise terminate
without being exercised, the Common Stock not purchased pursuant to such
options again becomes available for issuance under the 1996 Plan.
TERMS OF OPTIONS
The following is a description of the permissible terms of options
under the 1996 Plan. Individual option grants may be more restrictive as to
any or all of the permissible terms described below.
Exercise Price; Payment. The exercise price of incentive stock
options under the 1996 Plan may not be less than the fair market value of the
Common Stock subject to the option on the date of the option grant, and in some
cases (see "Eligibility" above) may not be less than 110% of such fair market
value. The exercise price of nonstatutory options under the 1996 Plan may not
be less than 85% of the fair market value of the Common Stock subject to the
option on the date of the option grant. However, if options were granted with
exercise prices below fair market value, deductions for compensation
attributable to the exercise of such options could be limited by Section
162(m). See "Federal Income Tax Information." At April 17, 1997, the closing
price of the Company's Common Stock as reported on The Nasdaq Stock Market
(National Market) was $115/8 per share.
In the event of a decline in the value of the Company's Common Stock,
the Board has the authority to offer employees the opportunity to replace
outstanding higher priced options, whether incentive or nonstatutory, with new
lower priced options. To the extent required by Section 162(m), an option
repriced under the 1996 Plan is deemed to be canceled and a new option granted.
Both the option deemed to be canceled and the new option deemed to be granted
will be counted against the 460,000 share limitation.
The exercise price of options granted under the 1996 Plan must be paid
either: (a) in cash at the time the option is exercised; or (b) at the
discretion of the Board, (i) by delivery of other Common Stock of the Company,
(ii) pursuant to a deferred payment arrangement or (c) in any other form of
legal consideration acceptable to the Board.
Option Exercise. Options granted under the 1996 Plan may become
exercisable in cumulative increments ("vest") as determined by the Board.
Shares covered by currently outstanding options under the 1996 Plan typically
vest at the rate of 1/5 of the options becoming exercisable one year following
the date of grant and 1/60th of the options becoming exercisable each month
(20% per year) during the optionee's employment or services as a consultant.
Shares covered by options granted in the future under the 1996 Plan may be
subject to different vesting terms. The Board has the power to accelerate the
time during which an option may be exercised. In addition, options granted
under the 1996 Plan may permit exercise prior to vesting, but in such event the
optionee may be required to enter into an early exercise stock purchase
agreement that allows the Company to repurchase shares not yet vested at their
exercise price should the optionee leave the employ of the Company before
vesting. To the extent provided by the terms of an option, an optionee may
satisfy any federal, state or local tax withholding obligation relating to the
exercise of such option by a cash payment upon exercise, by authorizing the
Company to withhold a portion of the stock otherwise issuable to the optionee,
by delivering already-owned stock of the Company or by a combination of these
means.
Term. The maximum term of options under the 1996 Plan is 10 years,
except that in certain cases (see "Eligibility") the maximum term is five
years. Options under the 1996 Plan terminate three months after termination of
the optionee's employment or relationship as a consultant or director of the
Company or any affiliate of the Company, unless (a) such termination is due to
such person's permanent and total disability (as defined in the Code), in which
case the option may, but need not, provide that it may be exercised at any time
within one year of such termination; (b) the optionee dies while employed by or
serving as a consultant or director of the Company or any affiliate of the
Company, or within three months after termination of such relationship, in
7
<PAGE> 10
which case the option may, but need not, provide that it may be exercised (to
the extent the option was exercisable at the time of the optionee's death)
within one year of the optionee's death by the person or persons to whom the
rights to such option pass by will or by the laws of descent and distribution;
or (c) the option by its terms specifically provides otherwise. Individual
options by their terms may provide for exercise within a longer period of time
following termination of employment or the consulting relationship. The option
term may also be extended in the event that exercise of the option within these
periods is prohibited for specified reasons.
ADJUSTMENT PROVISIONS
If there is any change in the stock subject to the 1996 Plan or
subject to any option granted under the 1996 Plan (through merger,
consolidation, reorganization, recapitalization, stock dividend, dividend in
property other than cash, stock split, liquidating dividend, combination of
shares, exchange of shares, change in corporate structure or otherwise), the
1996 Plan and options outstanding thereunder will be appropriately adjusted as
to the class and the maximum number of shares subject to the 1996 Plan, the
maximum number of shares which may be granted to an employee during a calendar
year, and the class, number of shares and price per share of stock subject to
the outstanding options.
EFFECT OF CERTAIN CORPORATE EVENTS
The 1996 Plan provides that, in the event of a dissolution or
liquidation of the Company or specified types of merger or other corporate
reorganization, to the extent permitted by law, any surviving corporation will
be required to either assume options outstanding under the 1996 Plan or
substitute similar options for those outstanding under the 1996 Plan, or the
outstanding options will continue in full force and effect. In the event that
any surviving corporation declines to assume or continue options outstanding
under the 1996 Plan, or to substitute similar options, then the time during
which the options may be exercised will be accelerated and the options
terminated if not exercised during such time. The acceleration of an option in
the event of an acquisition or similar corporate event may be viewed as an
antitakeover provision, which may have the effect of discouraging a proposal to
acquire or otherwise obtain control of the Company.
DURATION, AMENDMENT AND TERMINATION
The Board may suspend or terminate the 1996 Plan without stockholder
approval or ratification at any time or from time to time. Unless sooner
terminated, the 1996 Plan will terminate on March 5, 2006.
The Board may also amend the 1996 Plan at any time or from time to
time. However, no amendment will be effective unless approved by the
stockholders of the Company within 12 months before or after its adoption by
the Board if the amendment would: (a) modify the requirements as to eligibility
for participation (to the extent such modification requires stockholder
approval in order for the Plan to satisfy Section 422 of the Code, if
applicable, or Rule 16b-3 ("Rule 16b-3") of the Securities Exchange Act of
1934, as amended (the "Exchange Act")); (b) increase the number of shares
reserved for issuance upon exercise of options; or (c) change any other
provision of the 1996 Plan in any other way if such modification requires
stockholder approval in order to comply with Rule 16b-3 or satisfy the
requirements of Section 422 of the Code. The Board may submit any other
amendment to the 1996 Plan for stockholder approval, including, but not limited
to, amendments intended to satisfy the requirements of Section 162(m) of the
Code regarding the exclusion of performance-based compensation from the
limitation on the deductibility of compensation paid to certain employees.
RESTRICTIONS ON TRANSFER
Under the 1996 Plan, an incentive stock option may not be transferred
by the optionee otherwise than by will or by the laws of descent and
distribution and, during the lifetime of the optionee, may be exercised only by
the optionee. A nonstatutory stock option may not be transferred except by
will or by the laws of descent and distribution or pursuant to a "qualified
domestic relations order." In any case, the optionee may designate in writing
a third party who may exercise the option in the event of the optionee's death.
In addition, shares subject
8
<PAGE> 11
to repurchase by the Company under an early exercise stock purchase agreement
may be subject to restrictions on transfer Which the Board deems appropriate.
FEDERAL INCOME TAX INFORMATION
Incentive Stock Options. Incentive stock options under the 1996 Plan
are intended to be eligible for the favorable federal income tax treatment
accorded "incentive stock options" under the Code.
There generally are no federal income tax consequences to the optionee
or the Company by reason of the grant or exercise of an incentive stock option.
However, the exercise of an incentive stock option may increase the optionee's
alternative minimum tax liability, if any.
If an optionee holds stock acquired through exercise of an incentive
stock option for at least two years from the date on which the option is
granted and at least one year from the date on which the shares are transferred
to the optionee upon exercise of the option, any gain or loss on a disposition
of such stock will be long-term capital gain or loss. Generally, if the
optionee disposes of the stock before the expiration of either of these holding
periods (a "disqualifying disposition"), at the time of disposition, the
optionee will realize taxable ordinary income equal to the lesser of (a) the
excess of the stock's fair market value on the date of exercise over the
exercise price, or (b) the optionee's actual gain, if any, on the purchase and
sale. The optionee's additional gain, or any loss, upon the disqualifying
disposition will be a capital gain or loss, which will be long-term or
short-term depending on whether the stock was held for more than one year.
Long-term capital gains currently are generally subject to lower tax rates than
ordinary income. The maximum capital gains rate for federal income tax
purposes is currently 28% while the maximum ordinary income rate is effectively
39.6% at the present time. Slightly different rules may apply to optionees who
acquire stock subject to certain repurchase options or who are subject to
Section 16(b) of the Exchange Act.
To the extent the optionee recognizes ordinary income by reason of a
disqualifying disposition, the Company will generally be entitled (subject to
the requirement of reasonableness, the provisions of Section 162(m) of the Code
and the satisfaction of a tax reporting obligation) to a corresponding business
expense deduction in the tax year in which the disqualifying disposition
occurs.
Nonstatutory Stock Options. Nonstatutory stock options granted under
the 1996 Plan generally have the following federal income tax consequences:
There are no tax consequences to the optionee or the Company by reason
of the grant of a nonstatutory stock option. Upon exercise of a nonstatutory
stock option, the optionee normally will recognize taxable ordinary income
equal to the excess of the stock's fair market value on the date of exercise
over the option exercise price. Generally, with respect to employees, the
Company is required to withhold from regular wages or supplemental wage
payments an amount based on the ordinary income recognized. Subject to the
requirement of reasonableness, the provisions of Section 162(m) of the Code and
the satisfaction of a tax reporting obligation, the Company will generally be
entitled to a business expense deduction equal to the taxable ordinary income
realized by the optionee. Upon disposition of the stock, the optionee will
recognize a capital gain or loss equal to the difference between the selling
price and the sum of the amount paid for such stock plus any amount recognized
as ordinary income upon exercise of the option. Such gain or loss will be long
or short-term depending on whether the stock was held for more than one year.
Slightly different rules may apply to optionees who acquire stock subject to
certain repurchase options or who are subject to Section 16(b) of the Exchange
Act.
Potential Limitation on Company Deductions. As part of the Omnibus
Budget Reconciliation Act of 1993, the U.S. Congress amended the Code to add
Section 162(m), which denies a deduction to any publicly held corporation for
compensation paid to certain employees in a taxable year to the extent that
compensation exceeds $1,000,000 for a covered employee. It is possible that
compensation attributable to stock options, when combined with all other types
of compensation received by a covered employee from the Company, may cause this
limitation to be exceeded in any particular year.
9
<PAGE> 12
Certain kinds of compensation, including qualified "performance-based
compensation," are disregarded for purposes of the deduction limitation. In
accordance with proposed Treasury regulations issued under Section 162(m),
compensation attributable to stock options will qualify as performance-based
compensation, provided that the option is granted by a compensation committee
comprised solely of "outside directors" and either: (i) the option plan
contains a per-employee limitation on the number of shares for which options
may be granted during a specified period, the per- employee limitation is
approved by the stockholders, and the exercise price of the option is no less
than the fair market value of the stock on the date of grant; or (ii) the
option is granted (or exercisable) only upon the achievement (as certified in
writing by the compensation committee) of an objective performance goal
established in writing by the compensation committee while the outcome is
substantially uncertain, and the option is approved by stockholders.
The following table presents certain information with respect to
options to be granted under the 1996 Plan during the Company's fiscal year
ending December 31, 1997 to (i) the Named Executive Officers (as defined in
"Executive Compensation" below), (ii) all executive officers as a group, (iii)
all non-executive officer directors as a group, and (iv) all non-executive
officer employees as a group.
NEW PLAN BENEFITS
<TABLE>
<CAPTION>
1996 EQUITY INCENTIVE PLAN
----------------------------------------------------------------------
NUMBER OF SHARES SUBJECT
NAME AND POSITION DOLLAR VALUE(1) TO OPTIONS GRANTED
- ------------------------------------- -------------------------------- -----------------------------------
<S> <C> <C>
Daniel S. Lankford(2) $1,326,996 121,166
Joseph F. Fojtasek(2) $ 799,998 133,333
Sandra D. Schreiber(2) $ 644,000 50,000
Robert F. Nelson(2)(3) -- --
Arnold C. Allen(2) $ 204,183 16,668
All Executive Officers $2,975,177 321,167
as a Group(2)
All Non-Executive Officer $ 46,500(4) 4,000
Directors as a Group
All Non-Executive Officer $1,853,295 143,166
Employees as a Group(2)
</TABLE>
- --------------
(1) Exercise price multiplied by the number of shares underlying the
option(s).
(2) Option grants to this person or group of persons will be made at the
discretion of the Board and are not determinable at this time.
Accordingly, this table sets forth information regarding option grants
actually made to such person or group of persons during the Company's
fiscal year ended December 31, 1996.
(3) Mr. Nelson resigned as Vice President, Technology effective January
1997.
(4) Based on an assumed exercise price of $115/8 per share, the closing
price of the Company's Common Stock on April 17, 1997, as reported on
The Nasdaq Stock Market (National Market). The actual exercise price
will be equal to the closing price on June 5, 1997.
10
<PAGE> 13
PROPOSAL 3
RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of Directors has selected Arthur Andersen LLP as the
Company's independent accountants for the fiscal year ending December 31, 1997
and has further directed that management submit the selection of independent
accountants for ratification by the stockholders at the Annual Meeting. Arthur
Andersen LLP has audited the Company's financial statements since 1991.
Representatives of Arthur Andersen LLP are expected to be present at the Annual
Meeting, will have an opportunity to make a statement if they so desire, and
will be available to respond to appropriate questions.
Stockholder ratification of the selection of Arthur Andersen LLP as
the Company's independent accountants is not required by the Company's Bylaws
or otherwise. However, the Board is submitting the selection of Arthur
Andersen LLP to the stockholders for ratification as a matter of good corporate
practice. If the stockholders fail to ratify the selection, the Audit
Committee and the Board will reconsider whether or not to retain that firm.
Even if the selection is ratified, the Audit Committee and the Board in their
discretion may direct the appointment of different independent accountants at
any time during the year if they determine that such a change would be in the
best interests of the Company and its stockholders.
The affirmative vote of the holders of a majority of the shares
present in person or represented by proxy and entitled to vote at the Annual
Meeting will be required to ratify the selection of Arthur Andersen LLP.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 3.
11
<PAGE> 14
EXECUTIVE OFFICERS AND KEY EMPLOYEES
Set forth below are the names, periods of service and past experience
of the executive officers and key employees of the Company.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
EXECUTIVE OFFICERS
Daniel S. Lankford 51 Chief Executive Officer, President and Chairman of
the Board
Joseph F. Fojtasek 56 Chief Financial Officer, Vice President of Finance
and Administration, Secretary and Treasurer
Sandra D. Schreiber 48 Senior Vice President, Operations
Arnold C. Allen 57 Vice President, Marketing and Sales
KEY EMPLOYEES
Dr. Ramesh C. Bhardwaj 41 Principal Materials Scientist
Michael E. Cox 46 Director of Product Engineering
Kevin C. Obenchain 41 Controller
Dr. Hollis Pence 46 Director of Systems Development
Victor Rompa 36 Director of Quality and Applications
David T. Sell 55 Director of Manufacturing
Steven M. Sherepita 46 Director of Facilities and Pilot Operations
</TABLE>
EXECUTIVE OFFICERS
Daniel S. Lankford has served as Chief Executive Officer and President
of Bolder since July 1994 and as Chairman of the Board of Directors since
October 1996. Prior to joining the Company, Mr. Lankford was Chief Executive
Officer of AT&T Microelectronics--Europe from December 1989 to July 1994, and
prior to that, Mr. Lankford served as Vice President of Marketing for AT&T's
worldwide microelectronics unit. He received his M.S. in Management as a Sloan
Fellow from Stanford University and his B.S. from Johns Hopkins University.
Mr. Lankford is a Class I Director.
Joseph F. Fojtasek joined Bolder as Chief Financial Officer, Vice
President of Finance and Administration, Secretary and Treasurer in February
1996. From April 1992 to February 1996, Mr. Fojtasek served as Vice President
and Chief Financial Officer of CoCensys, Inc., a biopharmaceutical company. In
1990 and 1991, Mr. Fojtasek provided financial consulting services, in some
cases acting as Chief Financial Officer, to various early stage technology
companies. He received his M.B.A. and B.S. from the University of Texas.
Sandra D. Schreiber has served as the Company's Senior Vice President,
Operations since August 1995 and served as Vice President, Quality from March
1994 to February 1995, when she became Vice President, Operations. Prior to
joining Bolder in August 1993, Ms. Schreiber was Vice President, Technical
Operations at
12
<PAGE> 15
Ivion Corporation, a manufacturer of infusion pumps. Ms. Schreiber received
her B.S. from Montana State University.
Arnold C. Allen joined Bolder in October 1994 as Vice President,
Marketing and Sales. From April 1993 to October 1994, Mr. Allen was the
Director of Marketing and Sales for OPTIMA Battery Company, a manufacturer of
batteries. From 1991 to April 1993, Mr. Allen was an Environmental Clean-Up
Process Manager for Halliburton Corporation, an energy company. Mr. Allen has
a B.S. from the United States Naval Academy.
KEY EMPLOYEES
Dr. Ramesh C. Bhardwaj joined Bolder in June 1996 as Principal
Materials Scientist. From May 1994 to June 1996, Dr. Bhardwaj was an Engineer
V with Rockwell International Company. From April 1993 to May 1994, Dr.
Bhardwaj was Principal Scientist with Lockheed Engineering and Sciences
Company, in their White Sands Test Facility, NASA-Johnson Space Center. From
May 1988 to April 1993, Dr. Bhardwaj was Senior Scientist in the Department of
Chemistry at Texas A&M University. Dr. Bhardwaj holds an M.S. and Ph.D. in
Electrochemistry and Spectroscopy from the University of Jobhbur.
Michael E. Cox joined Bolder in May 1996 as Director of Product
Engineering. From 1995 to May 1996, Mr. Cox was a Manufacturing Consultant to
Commonwealth Sprague Capacitor, Inc., a manufacturer of capacitors and DC motor
drives. From 1994 to 1995, Mr. Cox served as Manager -- Special Projects for
Aerovox, Inc., a manufacturer of capacitors and as a manufacturing consultant.
From 1988 to 1993, Mr. Cox served as Manager of Quality Control and Project
Manager for Aerovox, Inc. Mr. Cox received an M.B.A. from SUNY-Albany and his
B.S. from Regis College.
Kevin C. Obenchain, CPA, joined Bolder in November 1996 as Controller.
From November 1994 to May 1996, Mr. Obenchain was the Controller for Combyte,
Inc., a manufacturer of data storage products. From 1991 to October 1994, Mr.
Obenchain was a Division Accountant at Array Technology Corporation, a
manufacturer of disk arrays. Mr. Obenchain has an M.B.A. in Accounting from
the University of Colorado and a B.A. from Michigan State University.
Dr. Hollis Pence joined Bolder in October 1996 as Director of Systems
Development. Dr. Pence had been a technical consultant to Bolder since March
1995. From 1991 to October 1996, Dr. Pence served as President of the
Technical Network, Inc., a consulting firm in statistical and reliability
engineering. Dr. Pence received his Ph.D. and M.A. from the University of
Northern Colorado and his B.A. from the University of Colorado.
Victor Rompa joined Bolder in September 1994 and is the Director of
Quality and Applications. From April 1991 to September 1994, Mr. Rompa was
Manager, Product Assurance and Test for SAFT Aerospace Batteries, a battery
manufacturer. Mr. Rompa holds a B.S.E.E. from the University of Hartford.
David T. Sell joined Bolder in February 1997 as Director of
Manufacturing. From June 1991 to February 1997, Mr. Sell held various
positions with Sharp Microelectronics Technology, a manufacturer of
semi-conductors, including Director of Operations and Quality Assurance
Manager. Mr. Sell holds an M.B.A. from Regis University and a B.S. from San
Jose State University.
Steven M. Sherepita joined Bolder in March 1993 and is the Director of
Facilities and Pilot Operations. From 1990 to March 1993, Mr. Sherepita served
as Plant Manager for Warvel Products, Inc., a furniture manufacturing company.
13
<PAGE> 16
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
ownership of the Company's Common Stock as of April 17, 1997 by: (i) each
director and nominee for director; (ii) each of the Named Executive Officers
employed by the Company on April 17, 1997; (iii) all executive officers and
directors of the Company as a group; and (iv) each person known by the Company
to be the beneficial owner of more than five percent of the Company's Common
Stock.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP (1)
----------------------------------------
BENEFICIAL OWNER NUMBER OF SHARES PERCENT OF TOTAL
- ----------------------------------------------------------------- ------------------- ---------------------
<S> <C> <C>
Funds managed by Patricof & Co. Ventures, Inc.(2) ............... 1,991,126 21.1%
2100 Geng Road
Palo Alto, CA 94303
Columbine Venture Fund II, L.P.(3) .............................. 1,864,561 19.8%
6312 South Fiddler's Green Circle
Suite 260
Englewood, CO 80111
Johnson Controls Battery Group, Inc. ............................ 558,666 5.9%
5757 North Green Bay Avenue
P.O. Box 591
Milwaukee, WI 53201
549,800 5.8%
The TCW Group, Inc. .............................................
865 South Figueroa Street
Los Angeles, CA 90017
Daniel S. Lankford(4) ........................................... 304,543 3.2%
Joseph F. Fojtasek(5) ........................................... 30,599 *
Sandra D. Schreiber(6) .......................................... 77,279 *
Arnold C. Allen(7) .............................................. 17,918 *
Wilmer R. Bottoms, Ph.D.(8) ..................................... 1,111 *
Tristan E. Juergens(9) .......................................... 395,605 4.2%
David L. Riegel(10) ............................................. 83,672 *
Carl S. Stutts(3)(9) ............................................ 1,865,672 19.8%
All executive officers and directors
as a group (8 persons)(11) ...................................... 2,776,399 28.5%
</TABLE>
- ----------------
* Less than one percent.
(1) This table is based upon information supplied by officers, directors
and principal stockholders and Schedules 13D and 13G, if any, filed
with the Securities and Exchange Commission (the "SEC"). Unless
otherwise indicated in the footnotes to this table and subject to
community property laws where applicable, the Company believes that
each of the stockholders named in this table has sole voting and
investment power with respect to the shares indicated as beneficially
owned. Applicable percentages are based on 9,429,874 shares of Common
Stock outstanding on April 17, 1997, adjusted as required by rules
promulgated by the SEC.
14
<PAGE> 17
(2) Consists of 1,389,881 shares held by APA Excelsior III, L.P., 529,638
shares held by Coutts & Co. (Jersey) Ltd., Custodian for APA Excelsior
III/Offshore, L.P. and 71,677 shares held by CIN Venture Nominees
Limited.
(3) Mr. Stutts is a general partner of Columbine Venture Management II,
the general partner of Columbine Venture Fund II,L.P. ("Columbine").
Mr. Stutts disclaims beneficial ownership of the shares held by
Columbine except to the extent of his pecuniary interest arising from
his general partnership interest therein.
(4) Includes 76,375 shares which are subject to repurchase by the Company
prior to becoming vested (such vesting occurring at the rate of 5,875
shares per month) and 169,817 shares subject to stock options that are
exercisable within 60 days of April 17, 1997.
(5) Includes 29,629 shares subject to stock options that are exercisable
within 60 days of April 17, 1997.
(6) Includes 72,264 shares subject to stock options that are exercisable
within 60 days of April 17, 1997.
(7) Includes 14,221 shares subject to stock options that are exercisable
within 60 days of April 17, 1997.
(8) Consists solely of shares subject to stock options that are
exercisable within 60 days of April 17, 1997.
(9) Includes 1,111 shares subject to stock options that are exercisable
within 60 days of April 17, 1997.
(10) Includes 28,611 shares subject to stock options that are exercisable
within 60 days of April 17, 1997.
(11) See notes 4 through 10 above.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than ten percent of a registered
class of the Company's equity securities, to file with the SEC initial reports
of ownership and reports of changes in ownership of Common Stock and other
equity securities of the Company. Officers, directors and greater than ten
percent stockholders are required by SEC regulations to furnish the Company
with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1996, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten percent beneficial owners were complied with.
15
<PAGE> 18
EXECUTIVE COMPENSATION
COMPENSATION OF DIRECTORS
The Company's directors do not currently receive any cash compensation
for service on the Board of Directors or any committee thereof, other than
grants of nonstatutory stock options to non-employee directors under the 1996
Plan. The members of the Board of Directors are also eligible for
reimbursement for their expenses incurred in connection with attendance at
Board meetings, in accordance with Company policy.
Non-employee directors are eligible only for nonstatutory option
grants. Each person who becomes a non- employee director will automatically be
granted an option to purchase 10,000 shares of Common Stock on the date of his
or her election to the Board. On the date of each annual meeting of
stockholders of the Company, beginning in 1997, each non-employee director who
has continuously served as a non-employee director since the last annual
meeting will be granted an option to purchase 1,000 shares of Common Stock, and
each other person who is then a non-employee director will be granted an option
to purchase a prorated number of shares of Common Stock based on the number of
days such person has continuously served as a non-employee director since the
last annual meeting. Initial options granted to non-employee directors vest in
five equal annual increments following the date of grant, and annual options
granted to non-employee directors vest in three equal annual increments
following the date of grant.
During the last fiscal year, the Company granted options covering an
aggregate of 40,000 shares to its four non-employee directors, at a weighted
average exercise price of $13.20 per share.
COMPENSATION OF EXECUTIVE OFFICERS
Summary of Compensation
The following table shows for the fiscal years ended December 31, 1995
and 1996, compensation awarded or paid to, or earned by, the Company's Chief
Executive Officer and its other four most highly compensated executive officers
at December 31, 1996 (the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------------------------------ ---------------------------
AWARDS PAYOUTS
----------- --------------
FISCAL SALARY BONUS OTHER ANNUAL ALL OTHER
NAME AND PRINCIPAL POSITION YEAR ($) ($) COMPENSATION ($) OPTIONS (#) COMPENSATION($)
- -------------------------------- ------ -------- --------- ---------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Daniel S. Lankford . . . . . . 1995 $180,000 $ 8,400 -- 21,150 --
Chief Executive Officer, 1996 193,333 80,000 -- 121,166 --
President and Chairman of the
Board
Joseph F. Fojtasek . . . . . . 1995 -- -- -- -- --
Chief Financial Officer, Vice 1996 102,917 25,040 -- 133,333 35,000(1)
President of Finance and
Administration, Secretary and
Treasurer
Sandra D. Schreiber . . . . . . 1995 116,731 7,839 -- 41,999 --
Sr. Vice President, 1996 145,000 26,440 -- 50,000 --
Operations
Robert F. Nelson . . . . . . . 1995 106,000 6,130 -- -- --
Vice President, Technology 1996 106,000 4,950 -- -- --
(2)
Arnold C. Allen . . . . . . . . 1995 100,000 5,000 -- 26,666 --
Vice President, Marketing and 1996 105,000 16,610 -- 16,668 --
Sales
</TABLE>
__________________________
(1) Reimbursement of moving expenses.
(2) Mr. Nelson resigned as Vice President, Technology effective January 1997.
16
<PAGE> 19
Stock Option Grants and Exercises
The Company grants options to its executive officers under its 1996
Plan. As of December 31, 1996, options to purchase a total of 887,750 shares
were outstanding under the 1996 Plan and options to purchase 193,086 shares
remained available for grant thereunder.
The following tables show for the fiscal year ended December 31, 1996,
certain information regarding options granted to, exercised by, and held at
year-end by, the Named Executive Officers:
OPTION GRANTS IN FISCAL 1996
<TABLE>
<CAPTION>
% OF TOTAL
OPTIONS
GRANTED TO EXERCISE OR
OPTIONS EMPLOYEES IN BASE EXPIRATION
NAME GRANTED (#) FISCAL YEAR PRICE ($/SH) DATE(1)
---- -------------- ------------ ------------ --------
<S> <C> <C> <C> <C>
Daniel S. Lankford . . . . . . . . . . . . . 21,166 (2) 4.3 $ 6.00 02/06/06
100,000 (3) 20.2 $ 12.00 07/17/06
Joseph F. Fojtasek . . . . . . . . . . . . . 133,333 (4) 27.0 $ 6.00 02/12/06
Sandra D. Schreiber . . . . . . . . . . . . . 50,000 (5) 10.1 $ 12.88 06/01/06
Robert F. Nelson . . . . . . . . . . . . . . -- -- -- --
Arnold C. Allen . . . . . . . . . . . . . . . 16,668 (6) 3.4 $ 12.25 08/29/06
</TABLE>
- ---------------------
(1) Any of the options that are exercisable on the date of termination of
employment may be exercised until the earlier of three months after
such termination and the expiration date unless termination was a
result of total and permanent disability, in which case, until the
earlier of one year after such termination and the expiration date.
(2) Exercisable on the expiration date, unless the Board of Directors
accelerates the vesting of the options based on the achievement of
certain performance goals.
(3) Exercisable in 60 equal monthly installments, beginning August 18,
1997.
(4) One-sixth of the options become exercisable one year following the
date of grant. One-seventy-second of the options becomes exercisable
monthly thereafter.
(5) 20,000 of the options are exercisable in accordance with the vesting
schedule set forth in the following note. 30,000 of the options are
excercisable in accordance with the vesting schedule set forth in note
2 above.
(6) One-fifth of the options becomes exercisable one year following the
date of grant. One-sixtieth of the options becomes exercisable
monthly thereafter.
The following table sets forth information with respect to (i) the
exercise of stock options by the Named Executive Officers during the fiscal
year ended December 31, 1996, (ii) the number of unexercised options held by
the Named Executive Officers as of December 31, 1996 and (iii) the value of
unexercised in-the-money options (i.e., options for which the fair market value
of the Common Stock at December 31, 1996 ($16.44) exceeds the exercise price)
as of December 31, 1996:
17
<PAGE> 20
OPTION EXERCISES AND YEAR-END VALUE TABLE
<TABLE>
<CAPTION>
SHARES NUMBER OF UNEXERCISED OPTIONS VALUE OF UNEXERCISED IN-
ACQUIRED VALUE AT DEC. 31, 1996 THE-MONEY OPTIONS AT DEC. 31, 1996
NAME ON EXERCISE (#) REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- ----------- -------- ------------------------- ---------------------------------------
<S> <C> <C> <C> <C>
Daniel S. Lankford . . . . -- -- 151,843/139,140 $2,435,041/$933,505
Joseph F. Fojtasek . . . . -- -- -- /133,333 -- /$1,391,997
Sandra D. Schreiber . . . . -- -- 43,897/92,768 $700,710/$836,364
Robert F. Nelson . . . . . -- -- 24,166/25,834 $393,664/$420,836
Arnold C. Allen . . . . . . -- -- 10,887/39,113 $165,886/$409,399
</TABLE>
Employment Agreements
On July 11, 1994, the Company entered into an Employment Agreement
with Daniel S. Lankford, which provided for Mr. Lankford's employment as the
President and Chief Executive Officer of the Company. Under the terms of the
agreement, the Company agreed to pay Mr. Lankford a base salary of $180,000 and
granted Mr. Lankford an option to purchase 282,000 shares of Common Stock at an
exercise price of $.375 per share, subject to vesting over four years from the
start of Mr. Lankford's employment with the Company. Mr. Lankford exercised
this option as to 133,333 shares early, subject to the Company's right to
repurchase a portion of such stock if Mr. Lankford leaves the Company prior to
the expiration of the vesting of the option. The Company also paid Mr.
Lankford $50,000 to cover his relocation expenses. In the event that the
Company terminates Mr. Lankford's employment other than for cause, the Company
agreed to pay Mr. Lankford an amount equal to six months of his base salary.
Pursuant to the Employment Agreement, in June 1995 the Company granted Mr.
Lankford an additional option to purchase 21,150 shares of Common Stock at an
exercise price of $1.50 per share, which options will vest in ten years unless
the Board of Directors accelerates the vesting of the options based on Mr.
Lankford's achievement of certain performance goals. In February 1996, the
Company accelerated the vesting of 3,176 shares of such option based on an
evaluation of Mr. Lankford's performance during 1995 and granted Mr. Lankford
an option to purchase 21,166 shares of Common Stock at an exercise price of
$6.00 per share, which options will vest in ten years unless the Board of
Directors accelerates the vesting of the options based on Mr. Lankford's
achievement of certain performance goals. In January 1997, the Company
accelerated the vesting of the remaining 17,974 shares of the June 1995 option
based on an evaluation of Mr. Lankford's performance during 1996 and granted
Mr. Lankford an option to purchase 21,166 shares of Common Stock at an exercise
price of $15.25 per share, which options will vest in ten years unless the
Board of Directors accelerates the vesting of the options based on Mr.
Lankford's achievement of certain performance goals.
Pursuant to an Employment Agreement, dated April 1, 1993, between the
Company and William E. Younkes, at that time the President and Chief Executive
Officer of the Company, the Company granted Mr. Younkes an option to purchase
238,333 shares of Common Stock at an exercise price of $.15 per share. This
option was subject to vesting over four years from the start of Mr. Younkes'
employment with the Company. Such agreement provided that should Mr. Younkes
remain with the Company for a specified period of time, vested shares, if any,
could be exercised in exchange for services rendered. Mr. Younkes resigned as
President and Chief Executive Officer in July 1994 and remained as Chairman of
the Board. Pursuant to an Employment Agreement Amendment, dated October 1,
1995, the Company agreed to retain the services of Mr. Younkes on an hourly
basis based upon his then current salary of $3,076 per week prorated to the
actual number of hours worked per week. The Company also agreed to extend Mr.
Younkes' original severance period of six months by one hour for every hour
worked, provided that the value of the severance benefit not exceed the amount
specified in the Employment Agreement. In addition, the Company reduced the
number of shares which vest on a monthly basis and extended the vesting period
of the unvested portion of Mr. Younkes' stock option, totaling 96,982 shares,
to 87 months beginning October 1, 1995. In February and June 1996, Mr. Younkes
exercised 66,451 and 10,425 shares, respectively, relating to these options.
Mr. Younkes resigned from the Board of Directors in October 1996.
18
<PAGE> 21
On February 13, 1996, the Company entered into a letter agreement with
Joseph F. Fojtasek, which provided for Mr. Fojtasek's employment with the
Company as Vice President, Finance and Administration, and Chief Financial
Officer. Under the terms of the letter agreement, the Company agreed to pay
Mr. Fojtasek a base salary of $130,000 per year, plus a bonus of up to $26,000
in 1996 based on the achievement of certain performance goals and Company
performance. The Company also agreed to grant Mr. Fojtasek an option to
purchase 133,333 shares of Common Stock at an exercise price of $6.00 per
share, subject to vesting over six years from the start of Mr. Fojtasek's
employment with the Company. In addition, the Company has agreed to grant Mr.
Fojtasek a bonus payable at the rate of $1.50 for each share of Common Stock
purchased by Mr. Fojtasek pursuant to such stock option grant. In the event
that the Company terminates Mr. Fojtasek's employment, other than for cause,
the Company agreed to pay Mr. Fojtasek an amount equal to six months of his
base salary. The Company also paid Mr. Fojtasek $35,000 to cover his
relocation expenses.
CERTAIN TRANSACTIONS
The Company issued an aggregate of 13,979 shares of Series C Preferred
Stock ("Series C Stock") at $3.00 per share and 666,284 shares of Series D
Preferred Stock ("Series D Stock") at $6.00 per share in a closing occurring in
April 1995 and sold 16,666 shares of Series D Stock at $6.00 per share in a
second closing occurring in January 1996. In consideration for these shares,
the stockholders, which include certain directors of the Company and their
affiliates, paid an aggregate of $4,139,637 in cash and cancellation of
indebtedness. In addition, in June 1995 the Company issued to Johnson Controls
Battery Group, Inc. ("Johnson Controls"): (i) 250,000 shares of Series E
Preferred Stock ("Series E Stock") at $6.00 per share in cash; and (ii)
warrants to purchase 308,666 shares of Series E Stock, at an exercise price of
$6.00 per share, in consideration of $463 in cash.
The following table sets forth the number of shares of the Company's
Preferred Stock purchased by each of the Company's directors, executive
officers and 5% stockholders and their respective affiliates:
<TABLE>
<CAPTION>
INVESTOR SERIES C STOCK SERIES D STOCK SERIES E STOCK
-------- -------------- -------------- --------------
<S> <C> <C> <C>
Columbine Venture Fund II, L.P. (1) . . . . . . . . 303,348 79,148 --
Funds managed by
Patricof & Co. Ventures, Inc. . . . . . . . . 315,925 124,527 --
David L. Riegel . . . . . . . . . . . . . . . . . . 8,359 578 --
Johnson Controls Battery Group, Inc. . . . . . . . -- -- 558,666
</TABLE>
- ----------------------
(1) Carl S. Stutts, a director of the Company, is a general partner of
Columbine Venture Management II, the general partner of Columbine
Venture Fund II, L.P.
In April 1994, the Company issued convertible promissory notes to
certain stockholders in the aggregate principal amount of $1,000,000. In
connection with this financing, the Company issued (i) notes in the amount of
$433,308 to Columbine Venture Fund II, L.P. ("Columbine") in exchange for cash,
and (ii) notes in the amount of $448,433 to funds managed by Patricof & Co.
Ventures, Inc. ("Patricof") in exchange for cash.
In March 1995, the Company issued convertible promissory notes to
certain stockholders in the aggregate principal amount of $1,797,750 and
warrants to purchase 149,998 shares of Common Stock for an aggregate
consideration of $2,250. In connection with such financing, the Company
issued: (i) a $474,893 note and warrants to purchase 39,624 shares of Common
Stock to Columbine in exchange for $475,487 in cash; (ii) notes in the amount
of $747,175 and warrants to purchase 62,342 shares of Common Stock to funds
managed by Patricof in exchange for $748,110 in cash; and (iii) a $3,474 note
and warrants to purchase 290 shares of Common Stock to David L. Riegel, a
director of the Company, for $3,478 in cash. The principal amounts of the
notes were converted into Series D Stock and the interest accrued on the notes
was converted into Series C Stock in May 1995.
19
<PAGE> 22
In August 1995, the Company loaned Tristan E. Juergens, at that time
the Chief Technical Officer and a director of the Company, $50,000 to assist
him in defraying certain medical expenses. The loan was made pursuant to a
promissory note executed by Mr. Juergens on August 29, 1995 bearing interest at
the rate of 6.04% per year. In addition, the Company repurchased 33,333 shares
of Common Stock held by Mr. Juergens at $1.50 per share, pursuant to a Stock
Repurchase Agreement between the Company and Mr. Juergens dated August 29,
1995. In November 1995, the Company loaned Mr. Juergens an additional sum of
$100,000 pursuant to a promissory note executed by Mr. Juergens on November 7,
1995 bearing interest at the rate of 6.04% per year. Each of these notes has
been repaid in full.
In August 1995, the Company issued a cash bonus to certain officers
and employees of the Company, a portion of the proceeds of which were used by
such officers and employees to purchase an aggregate of 22,443 shares of Common
Stock at $1.50 per share. In connection with this bonus, the Company issued:
(i) 2,914 shares to Arnold C. Allen; (ii) 2,196 shares to Tristan E. Juergens;
(iii) 3,088 shares to Robert F. Nelson; (iv) 3,933 shares to Sandra D.
Schreiber; and (v) an aggregate of 10,312 shares to other employees of the
Company.
In April and May 1996, certain stockholders of the Company exercised
warrants to purchase Common Stock in the following amounts and at the following
exercise prices: (i) 308,606 shares at an exercise price of $6.00 per share;
(ii) 166,666 shares at an exercise price of $1.50 per share; (iii) 145,128
shares at an exercise price of $.75 per share (including 63,270 shares issued
to certain stockholders pursuant to cashless exercises of warrants to purchase
68,138 shares). In connection with such warrant exercises, the Company issued
(i) 39,624 shares of Common Stock to Columbine for $29,718; (ii) 290 shares of
Common Stock to David L. Riegel for $217; (iii) 308,666 shares to Johnson
Controls for $1,851,996; and (iv) 57,888 shares to funds managed by Patricof
for $43,416.
Each share of Preferred Stock converted automatically into Common
Stock immediately prior to the closing of the Company's initial public
offering.
The Company believes that the foregoing transactions were in its best
interests. As a matter of policy, these transactions were, and all future
transactions between the Company and any of its officers, directors or
principal stockholders will be, approved by a majority of the independent and
disinterested members of the Board of Directors, will be on terms no less
favorable to the Company than could be obtained from unaffiliated third parties
and will be in connection with bona fide business purposes of the Company.
20
<PAGE> 23
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,
/s/ Joseph F. Fojtasek
Joseph F. Fojtasek, Secretary
April 29, 1997
21
<PAGE> 24
PROXY BOLDER TECHNOLOGIES CORPORATION PROXY
5181 Ward Road, Wheat Ridge, Colorado 80033
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
FOR THE ANNUAL MEETING OF STOCKHOLDERS -- JUNE 5, 1997
The undersigned hereby constitutes and appoints Daniel S. Lankford and
Joseph F. Fojtasek, and each of them, his true and lawful agents and proxies
with full power of substitution in each, to represent the undersigned at the
Annual Meeting of Stockholders of Bolder Technologies Corporation to be held at
4403 Table Mountain Parkway, Golden, Colorado, on Thursday, June 5, 1997 at
10:00 a.m. local time and at any postponements, continuations and adjournments
thereof, on all matters coming before said meeting.
1. ELECTION OF CLASS I DIRECTORS.
[ ] FOR ALL NOMINEES [ ] WITHHOLD AUTHORITY
FOR ALL NOMINEES
Nominees: Daniel S. Lankford, David L. Riegel
(To withhold vote for any individual nominee, write that name below.)
_____________________________________________________________________
2. APPROVAL OF 1996 EQUITY INCENTIVE PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
You are encouraged to specify your choices by marking the appropriate
boxes, but you need not mark any boxes if you wish to vote in accordance with
the Board of Directors' recommendations. The persons named herein as agents and
proxies cannot vote your shares unless you sign and return this card.
In their discretion, the proxies are entitled to vote upon such other
matters as may properly come before the meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR PROPOSALS 1 THROUGH 3.
Dated , 1997
--------------------------------
--------------------------------------------
--------------------------------------------
Signature(s)
PLEASE MARK, SIGN AND RETURN PROMPTLY USING THE
ENCLOSED ENVELOPE. EXECUTORS, ADMINISTRATORS,
TRUSTEES, ETC. SHOULD GIVE A TITLE AS SUCH. IF
THE SIGNER IS A CORPORATION, PLEASE SIGN FULL
CORPORATE NAME BY DULY AUTHORIZED OFFICER.
