<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
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<S> <C>
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 Rule 14a-11(c) or
Rule 14a-12
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LIGHTBRIDGE, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Not Applicable
- --------------------------------------------------------------------------------
(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)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / 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:
------------------------------------------------------------------------
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[LOGO]
LIGHTBRIDGE, INC.
67 SOUTH BEDFORD STREET
BURLINGTON, MASSACHUSETTS 01803
NOTICE OF SPECIAL MEETING IN LIEU OF 1999 ANNUAL MEETING OF STOCKHOLDERS
Dear Stockholder:
We invite you to attend our Special Meeting in Lieu of 1999 Annual Meeting
of Stockholders, which is being held as follows:
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DATE: Wednesday, June 9, 1999
TIME: 10:00 a.m.
LOCATION: Foley, Hoag & Eliot LLP
One Post Office Square
Sixteenth Floor
Boston, Massachusetts 02109
</TABLE>
At the Meeting, we will ask you and our other stockholders to:
- elect two directors to three-year terms; and
- consider any other business properly presented at the Meeting.
You may vote on these matters in person or by proxy. Whether you plan to
attend the Meeting or not, we ask that you complete and return the enclosed
proxy card promptly in the enclosed addressed, stamped envelope, so that your
shares will be represented and voted at the Meeting in accordance with your
wishes. If you attend the Meeting, you may withdraw your proxy and vote your
shares in person. Only stockholders of record at the close of business on May 3,
1999 may vote at the Meeting.
By order of the Board of Directors,
/s/ Alexander H. Pyle
Alexander H. Pyle
SECRETARY
May 7, 1999
<PAGE>
PROXY STATEMENT
FOR THE
LIGHTBRIDGE, INC.
SPECIAL MEETING IN LIEU OF
1999 ANNUAL MEETING OF STOCKHOLDERS
TABLE OF CONTENTS
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PAGE
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INFORMATION ABOUT THE MEETING
This Proxy Solicitation.................................................................................... 2
How to Vote................................................................................................ 2
Quorum Required to Transact Business....................................................................... 3
Availability of Auditors................................................................................... 3
DISCUSSION OF PROPOSAL
Proposal to Elect Two Directors............................................................................ 4
Other Matters.............................................................................................. 5
Stockholder Proposals for 2000 Annual Meeting.............................................................. 5
INFORMATION ABOUT DIRECTORS
Background Information About Directors Continuing in Office................................................ 6
Meetings of the Board of Directors......................................................................... 6
Committees of the Board of Directors....................................................................... 6
Compensation Committee Interlocks and Insider Participation................................................ 7
Compensation of Directors.................................................................................. 7
INFORMATION ABOUT EXECUTIVE OFFICERS
Background Information About Executive Officers............................................................ 8
Compensation of Executive Officers:
Summary Compensation Table for 1996, 1997 and 1998....................................................... 10
Option Grants in 1998.................................................................................... 11
Aggregated Option Exercises in 1998 and Option Values at December 31, 1998............................... 12
Report of the Compensation Committee on Repricing of Options in 1998..................................... 12
Option Repricings from 1989 to 1998...................................................................... 13
Report of the Compensation Committee on Executive Compensation for 1998.................................. 13
Related Party Transactions................................................................................. 15
INFORMATION ABOUT COMMON STOCK OWNERSHIP AND PERFORMANCE
Stock Owned by Directors, Executive Officers and Greater-than-5% Stockholders.............................. 16
Compliance with Reporting Requirements..................................................................... 18
Performance Graph.......................................................................................... 18
</TABLE>
<PAGE>
INFORMATION ABOUT THE MEETING
THIS PROXY SOLICITATION
We have sent you this proxy statement and the enclosed proxy card because
our Board of Directors is soliciting your proxy to vote at the Meeting
(including any adjournment or postponement of the Meeting).
- THIS PROXY STATEMENT summarizes information about the proposals to be
considered at the Meeting and other information you may find useful in
determining how to vote.
- THE PROXY CARD is the means by which you actually authorize another person
to vote your shares in accordance with your instructions.
We will pay the cost of soliciting these proxies. Our directors, officers
and employees may solicit proxies in person or by mail, telephone or facsimile.
We will reimburse brokers and other nominee holders of shares for expenses they
incur in forwarding proxy materials to the beneficial owners of those shares. We
have not retained the services of any proxy solicitation firm to assist us in
this solicitation.
We are mailing this proxy statement and the enclosed proxy card to
stockholders for the first time on or about May 7, 1999. In this mailing, we are
including a copy of our 1998 Annual Report to Stockholders. We will send you,
without charge, a copy of our Annual Report on Form 10-K for the year ended
December 31, 1998 (excluding exhibits), as filed with the Securities and
Exchange Commission, if you request it in writing. Requests may be sent to
Joseph S. Tibbetts, Jr., Senior Vice President, Finance & Administration and
Chief Financial Officer, at our address set forth on the Notice appearing on the
cover of this Proxy Statement.
HOW TO VOTE
You are entitled to one vote at the Meeting for each share of common stock
registered in your name at the close of business on May 3, 1999.
You may vote your shares at the Meeting in person or by proxy.
- TO VOTE IN PERSON, you must attend the Meeting, and then complete and
submit the ballot provided at the Meeting.
- TO VOTE BY PROXY, you must complete and return the enclosed proxy card.
Your proxy will be valid only if you sign, date and return it before the
Meeting. By completing and returning the proxy card, you will direct the
designated persons to vote your shares at the Meeting in the manner you
specify in the proxy card. If you complete all of the proxy card except
the voting instructions, then the designated persons will vote your shares
for the election of nominated directors. If any other business properly
comes before the Meeting, then the designated persons will have the
discretion to vote in any manner.
If you complete and return a proxy, you may revoke it at any time before it
is exercised by taking one of the following actions:
- send written notice to Alexander H. Pyle, our Secretary, at our address
set forth on the Notice appearing on the cover of this proxy statement;
- send us another signed proxy with a later date; or
- attend the Meeting, notify our Secretary that you are present, and then
vote in person.
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QUORUM REQUIRED TO TRANSACT BUSINESS
At the close of business on April 20, 1999, 16,141,514 shares of common
stock were outstanding. Our by-laws require that a majority of our common stock
be represented, in person or by proxy, at the Meeting in order to constitute the
quorum we need to transact business. We will count abstentions and broker
non-votes in determining whether a quorum exists.
AVAILABILITY OF AUDITORS
Deloitte & Touche LLP has been selected by our Board of Directors as the
independent public accountants to audit our financial statements for the year
ending December 31, 1999. Deloitte & Touche LLP also served as our auditors in
1998. We expect that representatives of Deloitte & Touche LLP will attend the
Meeting, will have an opportunity to make a statement if they desire to do so,
and will be available to respond to appropriate questions.
3
<PAGE>
DISCUSSION OF PROPOSAL
PROPOSAL TO ELECT TWO DIRECTORS
The only proposal on the agenda for the Meeting is the election of two
persons to serve as Class III directors for three-year terms beginning at the
Meeting and ending at the 2002 Annual Meeting of Stockholders. Our Board of
Directors currently has five members and is divided into three classes, two of
which have two members and one of which has one member. Each class of directors
serves a three-year term. We stagger these terms so that the term of only one
class expires each year.
Our Board of Directors has nominated Torrence C. Harder and Pamela D.A.
Reeve for re-election as Class III directors. Brief biographies of the nominees,
as of April 20, 1999, follow. You will find information about the nominees'
holdings of common stock on page 16.
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TORRENCE C. HARDER............... One of our founders, Mr. Harder has served as one of our
directors since June 1989 and currently serves as a
member of the Compensation Committee. Mr. Harder has been
the President and a director of Harder Management
Company, a registered investment advisory firm, since its
establishment in 1971. He has also been the President and
a director of Entrepreneurial Ventures, Inc., a venture
capital investment firm, since 1987 and currently serves
as a director of MicroFinancial, Inc., a microticket
leasing firm. Mr. Harder is 55 years old.
PAMELA D.A. REEVE................ Ms. Reeve has served as our President since November
1989, our Chief Executive Officer since September 1993
and as one of our directors since November 1989. From
November 1989 to September 1993, Ms. Reeve also served as
our Chief Operating Officer. Prior to joining us, Ms.
Reeve was employed by The Boston Consulting Group. Ms.
Reeve served as President of the Massachusetts Software
Council from January 1996 to January 1998. She currently
serves as a director of PageMart Wireless, Inc., a
provider of wireless messaging services, and Natural
MicroSystems Corp., a provider of hardware and software
technology for developers of high-value
telecommunications solutions. Ms. Reeve is 49 years old.
</TABLE>
If for any reason either Mr. Harder or Ms. Reeve becomes unavailable for
election, the persons designated in the proxy card may vote the proxy for the
election of a substitute. Mr. Harder and Ms. Reeve both have consented to serve
as directors if elected, and our Board of Directors has no reason to believe
that either nominee will become unavailable for election.
The two nominees receiving the greatest number of votes cast will be elected
as directors. We will not count abstentions or broker non-votes when we tabulate
votes cast for the election of directors.
OUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF MR.
HARDER AND MS. REEVE.
4
<PAGE>
OTHER MATTERS
Neither we nor our Board of Directors intends to propose any matters at the
Meeting other than the election of two directors. Neither we nor our Board knows
of any matters to be proposed by others at the Meeting.
STOCKHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
A stockholder who intends to present a proposal at the 2000 Annual Meeting
of Stockholders for inclusion in our 2000 proxy statement must submit the
proposal by January 7, 2000. In order for the proposal to be included in the
proxy statement, the stockholder submitting the proposal must meet certain
eligibility standards and must comply with certain procedures established by the
Securities and Exchange Commission, and the proposal must comply with the
requirements as to form and substance established by applicable laws and
regulations. The proposal must be mailed to our Secretary at our address set
forth on the Notice appearing on the cover of this proxy statement.
In addition, in accordance with our By-Laws, a stockholder wishing to bring
an item of business before the 2000 Annual Meeting of Stockholders must deliver
notice of the item of business to us at our offices no later than March 25,
2000, even if the item is not to be included in our proxy statement.
5
<PAGE>
INFORMATION ABOUT DIRECTORS
BACKGROUND INFORMATION ABOUT DIRECTORS CONTINUING IN OFFICE
The Class I and Class II directors will continue in office following the
Meeting, and their terms will expire in 2000 (Class 1) or 2001 (Class II). Brief
biographies of these directors, as of April 20, 1999, follow. You will find
information about their holdings of common stock on page 16.
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Andrew I. Fillat............. Mr. Fillat has served as one of our directors since April
CLASS II DIRECTOR 1996. Since July 1995, Mr. Fillat has served as Senior Vice
President of Advent International Corporation, a venture
capital investment firm. From April 1989 to June 1995, Mr.
Fillat served as Vice President of Advent International
Corporation. Mr. Fillat also serves as a director of
Advanced Radio Telecom Corp., a provider of broadband data
services; Interlink Computer Sciences Inc., a supplier of
solutions of products and services for enterprise networked
systems management; Safety 1st, Inc., a developer, marketer
and distributor of juvenile products; and Voxware, Inc., a
developer of speech and audio technologies. Mr. Fillat is 50
years old.
D. Quinn Mills............... Dr. Mills has served as one of our directors since June
CLASS II DIRECTOR 1990. Since 1976, Dr. Mills has served as the Albert J.
Weatherhead, Jr. Professor of Economics at the Harvard
Business School. Dr. Mills is 57 years old.
Debora J. Wilson............. Ms. Wilson has served as one of our directors since May
CLASS I DIRECTOR 1998. Ms. Wilson is currently Executive Vice President and
General Manager at The Weather Channel, a position she has
held since May 1998. From August 1994 to May 1998, Ms.
Wilson held other positions at The Weather Channel,
including President, U.S. Products and Distribution and
Senior Vice President--New Media. Prior to August 1994, Ms.
Wilson served as Director--Marketing and Product Development
of Bell Atlantic Video Services. Ms. Wilson is 41 years old.
</TABLE>
MEETINGS OF THE BOARD OF DIRECTORS
Our Board of Directors held ten meetings and acted by unanimous written
consent three times during the year ended December 31, 1998. All directors
attended at least 75% of the meetings of our Board.
COMMITTEES OF THE BOARD OF DIRECTORS
Our Board of Directors has appointed an Audit Committee and a Compensation
Committee. Our Board of Directors does not have a Nominating Committee.
The Audit Committee met twice during the year ended December 31, 1998. The
Audit Committee:
- reviews the scope and results of the annual audit of our consolidated
financial statements conducted by our independent accountants;
6
<PAGE>
- reviews the scope of other services provided by our independent
accountants;
- reviews proposed changes in our financial and accounting standards and
principles and in our policies and procedures for our internal accounting,
auditing and financial controls; and
- makes recommendations to our Board of Directors on the engagement of the
independent accountants.
The Audit Committee consists of Andrew Fillat and Quinn Mills, each of whom
attended both meetings of the Audit Committee in the year ended December 31,
1998.
The Compensation Committee met one time and acted by unanimous written
consent eleven times during the year ended December 31, 1998. The Compensation
Committee provides recommendations concerning salaries and incentive
compensation for our employees and consultants. In addition, the Compensation
Committee administers our compensation programs, including our 1990 Incentive
and Nonqualified Stock Option Plan, 1996 Incentive and Non-Qualified Stock
Option Plan, 1996 Employee Stock Purchase Plan and 1998 Non-Statutory Stock
Option Plan. The Compensation Committee also performs other duties that our
Board of Directors periodically assigns to it. The Compensation Committee
consists of Andrew Fillat and Torrence Harder, each of whom attended the meeting
of the Compensation Committee in the year ended December 31, 1998.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee consists of Andrew Fillat and Torrence Harder,
neither of whom has ever been one of our employees. None of our executive
officers serves as a member of the board of directors or compensation committee
of any entity that has one or more executive officers serving as members of our
Board of Directors or Compensation Committee.
COMPENSATION OF DIRECTORS
Directors who are not our employees receive stock option grants under our
1998 Non-Statutory Stock Option Plan. Upon election to the Board of Directors,
each non-employee director automatically receives an option to purchase 20,000
shares of common stock, which vests in three equal annual installments. In
addition, immediately following each annual meeting of stockholders (or special
meeting in lieu of an annual meeting), each non-employee director re-elected to
or remaining on the Board is automatically granted a fully vested option to
purchase 4,000 shares of common stock, PROVIDED that:
- any prior automatic grants held by the director have fully vested; or
- at least two annual meetings of stockholders (or special meetings in lieu
of annual meetings) have elapsed between any prior automatic grant made to
the director and the meeting upon which the subsequent automatic grant
would occur.
The exercise price per share of each automatic option grant is equal to the
closing price of our common stock on the date of such grant, as reported by the
Nasdaq National Market. Directors who are our employees are not entitled to
receive any separate compensation for serving as directors.
7
<PAGE>
INFORMATION ABOUT EXECUTIVE OFFICERS
BACKGROUND INFORMATION ABOUT EXECUTIVE OFFICERS
Brief biographies of our executive officers follow. The ages of the
executive officers are given as of April 20, 1999. You will find information
about their holdings of common stock on page 16.
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Pamela D.A. Reeve............. You will find background information about Ms. Reeve on page
PRESIDENT AND CHIEF 4. Ms. Reeve is 49 years old.
EXECUTIVE OFFICER
Joseph S. Tibbetts, Jr........ Mr. Tibbetts joined us in May 1998 as our Senior Vice
SENIOR VICE PRESIDENT, President, Finance & Administration, Chief Financial Officer
FINANCE & ADMINISTRATION AND and Treasurer. Mr. Tibbetts served as Vice President,
CHIEF FINANCIAL OFFICER Finance and Administration, Chief Financial Officer and
Treasurer of SeaChange International, Inc. from June 1996 to
March 1998. Prior to June 1996, Mr. Tibbetts was employed as
a certified public accountant by Price Waterhouse LLP, most
recently as a partner and National Director of its Software
Services Group. Mr. Tibbetts currently serves as a director
of Great Plains Software, Inc., a provider of business
management software solutions. Mr. Tibbetts is 46 years old.
William G. Brown.............. Mr. Brown has been our Executive Vice President, Development
EXECUTIVE VICE PRESIDENT, since May 1998. Previously, Mr. Brown served as our Chief
DEVELOPMENT Financial Officer, Vice President of Finance and
Administration and Treasurer from June 1989 to May 1998.
Prior to joining us, Mr. Brown was Manager of Financial
Reporting and Analysis for Bolt, Beranek and Newman, Inc.
and was employed at Deloitte, Haskins and Sells. Mr. Brown
is 38 years old.
Brian P. Connolly............. Mr. Connolly has been our Senior Vice President, Sales and
SENIOR VICE PRESIDENT, SALES Marketing since May 1998. Prior to joining us, Mr. Connolly
AND MARKETING was employed by Computer Sciences Corporation's Intellicom
Division, most recently as its Vice President and Chief
Operating Officer. Mr. Connolly is 49 years old.
Michael A. Perfit............. Mr. Perfit, one of our founders, has served as our Senior
SENIOR VICE PRESIDENT OF Vice President of Technology since June 1991. From June 1989
TECHNOLOGY to May 1991, Mr. Perfit served as our Vice President of
Engineering. Prior to joining us, Mr. Perfit was Vice
President of Appex, Inc. and held engineering and technical
support positions at Interactive Management Systems. Mr.
Perfit is 43 years old.
Richard H. Antell............. Mr. Antell has served as our Vice President, Software
VICE PRESIDENT, SOFTWARE Development since February 1996. From June 1991 to January
DEVELOPMENT 1996, Mr. Antell was our Vice President of Engineering.
Prior to joining us, Mr. Antell served as Vice President of
Application Development of Applied Expert Systems, Inc. and
Project Leader of Index Systems, Inc. Mr. Antell is 51 years
old.
</TABLE>
8
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Douglas E. Blackwell.......... Mr. Blackwell has served as our Vice President, Service
VICE PRESIDENT, Delivery since November 1995. From October 1994 to October
SERVICE DELIVERY 1995, Mr. Blackwell served as our Vice President of
Operations. From February 1991 to September 1994, Mr.
Blackwell was employed as Vice President of Operations of
Thomson Financial Services, Inc., an on-line financial
transaction and information services firm. Prior to February
1991, Mr. Blackwell was employed at Nolan, Norton and Co.,
an affiliate of KPMG/Peat Marwick. Mr. Blackwell is 42 years
old.
Carla J. Marcinowski.......... Ms. Marcinowski has been our Vice President, Consulting
VICE PRESIDENT, Services since February 1998. Prior to joining us as an
CONSULTING SERVICES employee, Ms. Marcinowski provided services to us as an
independent consultant from October 1997 to January 1998.
Ms. Marcinowski was a founder and Vice President, Business
Development of The Net Collaborative from July 1996 to
August 1997, and prior to March 1996 was employed by Lotus
Development Corporation in various positions, including
International Managing Director, Consulting Services,
Managing Director, Worldwide Services Group and Services
Lead, Lotus/IBM Transition Team. Ms. Marcinowski is 41 years
old.
</TABLE>
9
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE FOR 1996, 1997 AND 1998
The following table summarizes certain information with respect to the
annual and long-term compensation that we paid for the past three fiscal years
to the following persons (the "Named Officers"):
- Pamela D.A. Reeve, our president and chief executive officer throughout
1998; and
- Richard H. Antell, William G. Brown, Douglas E. Blackwell and Michael A.
Perfit, our four most highly compensated executive officers (other than
Ms. Reeve) in the year ended December 31, 1998.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
AWARDS
ANNUAL -----------
COMPENSATION SECURITIES ALL OTHER
---------------------- UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION(S) YEAR SALARY($) BONUS($)(1) OPTIONS(#) ($)(2)
- ------------------------------------ --------- --------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
Pamela D.A. Reeve................... 1998 $ 235,000 $ 96,500 300,000 $ 6,256
PRESIDENT AND CHIEF EXECUTIVE 1997 200,000 91,700 -- 4,405
OFFICER 1996 165,000 60,000 -- 2,814
Richard H. Antell................... 1998 165,000 63,200 -- 7,367
VICE PRESIDENT, 1997 130,000 50,400 -- 1,893
SOFTWARE DEVELOPMENT 1996 105,000 40,000 90,000 485
William G. Brown.................... 1998 150,000 63,200 -- 3,419
EXECUTIVE VICE PRESIDENT, 1997 130,000 50,000 -- 1,891
DEVELOPMENT 1996 108,462 65,000 70,000 166
Douglas E. Blackwell................ 1998 150,000 63,200 25,000(3) 3,589
VICE PRESIDENT, 1997 130,000 37,100 25,000 1,351
SERVICE DELIVERY 1996 105,000 40,000 90,000 252
Michael A. Perfit................... 1998 135,000 57,200 -- 4,235
SENIOR VICE PRESIDENT OF TECHNOLOGY 1997 109,900 29,600 -- 1,536
1996 92,700 20,000 -- 223
</TABLE>
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(1) Represents the aggregate amount of bonus installments we paid in the
applicable year with respect to bonuses earned in prior years. See "Report
of the Compensation Committee on Executive Compensation for 1998."
(2)Represents matching contributions we made pursuant to our 401(k) Plan and
payments of term life and long-term disability insurance premiums.
(3)Represents an option we issued in connection with the repricing of a
previously granted stock option.
10
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OPTION GRANTS IN 1998
The following table sets forth certain information regarding the options
that we granted to the Named Officers during the year ended December 31, 1998.
<TABLE>
<CAPTION>
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL
GRANTS POTENTIAL REALIZABLE
-------------------------------------------------------- VALUE AT ASSUMED
NUMBER OF ANNUAL RATE OF STOCK
SECURITIES PERCENT OF TOTAL PRICE APPRECIATION
UNDERLYING OPTIONS GRANTED EXERCISE FOR OPTION TERM(3)
OPTIONS TO EMPLOYEES IN PRICE EXPIRATION --------------------------
NAME GRANTED(#) FISCAL YEAR(1) ($/SH)(2) DATE 5%($) 10%($)
- ------------------------------------- ----------- ------------------- --------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Pamela D.A. Reeve.................... 300,000(4) 14.4% $ 12.125 5/22/08 $ 2,287,587 $ 5,797,229
Douglas E. Blackwell................. 25,000(5) 1.2 7.625 7/31/08 119,882 303,807
</TABLE>
- ------------------------
(1) Percentages are calculated based on a total of 2,084,349 options granted in
the year ended December 31, 1998, including 843,100 options granted in
connection with the repricing of certain stock options.
(2)All options were granted at fair market value, which was determined by the
Compensation Committee to be the closing price of our common stock on the
date of grant, as reported by the Nasdaq National Market.
(3)The amounts shown represent hypothetical values that could be achieved for
the respective options if exercised at the end of their option terms. These
gains are based on assumed rates of stock appreciation of five percent and
ten percent, compounded annually from the date the respective options were
granted to the date of their expiration. The gains shown are net of the
option price, but do not include deductions for taxes or other expenses that
may be associated with the exercise. Actual gains, if any, on stock option
exercises will depend on future performance of the common stock, the
optionholders' continued employment through the option period, and the date
on which the options are exercised.
(4)The option is exercisable as to 8.34% of the shares subject thereto upon the
date of grant, with an additional 8.34% of the shares vesting at the end of
each three-month period thereafter.
(5)Represents an option issued in connection with the repricing of a previously
granted stock option. The option is exercisable as to 20% of the shares
subject thereto upon the date of grant, with an additional 5% of the shares
vesting at the end of each three-month period thereafter.
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AGGREGATED OPTION EXERCISES IN 1998 AND OPTION VALUES AT DECEMBER 31, 1998
The following table sets forth information as to options exercised during
the year ended December 31, 1998, and unexercised options held at the end of
1998, by the Named Officers.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<S> <C> <C> <C> <C> <C> <C>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED VALUE OPTIONS AT FISCAL YEAR-END AT FISCAL YEAR-END($)(2)
ON REALIZED -------------------------- --------------------------
NAME EXERCISE(#) ($)(1) EXERCISABLE(#) UNEXERCISABLE(#) EXERCISABLE($) UNEXERCISABLE($)
- ----------------------- ----------- --------- ----------- ------------- ----------- -------------
Pamela D.A. Reeve...... 135,000 $1,031,500 335,109 284,891 $1,622,000 $ 51,200
Richard H. Antell...... 29,000 215,365 111,400 81,000 360,448 211,000
William G. Brown....... 55,000 665,123 40,000 75,000 23,750 190,000
Douglas E. Blackwell... -- -- 93,250 69,750 308,500 170,500
Michael A. Perfit...... -- -- -- -- -- --
</TABLE>
- ------------------------
(1) The values in this column are based on the last reported sale prices of the
common stock on the respective dates of exercise as reported by the Nasdaq
National Market, less the respective option exercise prices.
(2)The closing sale price for the common stock as reported by the Nasdaq
National Market on December 31, 1998 was $5.50. Value is calculated on the
basis of the difference between the option exercise price and $5.50,
multiplied by the number of shares of common stock underlying the option.
REPORT OF THE COMPENSATION COMMITTEE ON REPRICING OF OPTIONS IN 1998
THE FOLLOWING IS A REPORT OF THE COMPENSATION COMMITTEE DESCRIBING THE
REPRICING OF SOME OF THE STOCK OPTIONS HELD BY OUR EXECUTIVE OFFICERS IN 1998
AND THE REASONS FOR THE REPRICING.
On July 31, 1998, the Board of Directors determined that, because certain
stock options held by employees had exercise prices significantly higher than
the fair market value of the common stock, those stock options were not
providing the desired incentive to employees. Accordingly, the Board provided
employees with an opportunity to receive new options in replacement of any
existing options that had exercise prices of more than $7.625 per share (the
closing sale price for the common stock as reported by the Nasdaq National
Market on July 31, 1998). All Lightbridge officers and employees other than Ms.
Reeve, the President and Chief Executive Officer, were eligible to participate
in the stock option repricing, but options granted to Lightbridge's directors
were not eligible for repricing. The new options are exercisable for the same
number of shares as the options they replace, but they each have an exercise
price of $7.625 per share and a new vesting schedule that commenced as of July
31, 1998. As a result of the repricing, new options were granted to purchase
843,100 shares of common stock, and the average exercise price of the repriced
options was reduced from $12.44 per share to $7.625 per share.
The Board determined that it would include in the repricing out-of-the-money
options granted to Lightbridge's executive officers, other than Ms. Reeve,
because those options were principally held by executives who had recently
joined Lightbridge and held no other stock options. In particular, Joseph
Tibbetts, the Chief Financial Officer and Senior Vice President, Finance and
Administration, and Brian Connolly, the Senior Vice President of Sales and
Marketing, had joined Lightbridge less than three months
12
<PAGE>
before the repricing, and Carla Marcinowski, the Vice President, Consulting
Services, had joined Lightbridge less than six months before the repricing. The
Board believed that the goal of retaining and incenting these new executive
officers would be significantly impaired if they were not included in the
repricing program. In addition, the Board concluded that the decline in the
price of the common stock that occurred during the first seven months of 1998
could in no way be attributed to these new executives. One option granted to
Douglas Blackwell was also included in the repricing to provide an extra
incentive for him.
The Board decided not to include Ms. Reeve in the repricing because,
although she had recently been granted options that were out of the money, she
held a substantial number of options that were in the money. Additionally,
unlike most of the officers who were included in the repricing, she was a
long-time employee. The Board also felt that it would be appropriate to exclude
Ms. Reeve, as President and Chief Executive Officer, from the repricing.
Andrew I. Fillat
Torrence C. Harder
OPTION REPRICINGS FROM 1989 TO 1998
The following table sets forth information as to all repricings of stock
options held by any executive officer from 1989 to 1998.
<TABLE>
<CAPTION>
10-YEAR OPTION REPRICINGS
LENGTH OF
NUMBER OF ORIGINAL
SECURITIES MARKET PRICE OF EXERCISE OPTION TERM
UNDERLYING STOCK AT TIME PRICE AT NEW REMAINING AT
OPTIONS OF TIME OF EXERCISE DATE OF
NAME DATE REPRICED(#) REPRICING ($) REPRICING($) PRICE($) REPRICING
- ------------------------------ --------- ----------- --------------- ----------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
Douglas E. Blackwell.......... 7/31/98 25,000 $ 7.625 $ 10.25 $ 7.625 8 years,
VICE PRESIDENT, 6 months
SERVICE DELIVERY
Joseph S. Tibbetts, Jr........ 7/31/98 250,000 7.625 12.00 7.625 9 years,
SENIOR VICE PRESIDENT, 10 months
FINANCE & ADMINISTRATION AND
CHIEF FINANCIAL OFFICER
Brian P. Connolly............. 7/31/98 100,000 7.625 12.125 7.625 9 years,
SENIOR VICE PRESIDENT, 10 months
SALES AND MARKETING
Carla J. Marcinowski.......... 7/31/98 100,000 7.625 14.063 7.625 9 years,
VICE PRESIDENT, 6 months
CONSULTING SERVICES
</TABLE>
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION FOR 1998
THE FOLLOWING IS A REPORT OF THE COMPENSATION COMMITTEE DESCRIBING THE
COMPENSATION POLICIES AND RATIONALES THAT THE COMPENSATION COMMITTEE USED TO
DETERMINE THE COMPENSATION PAID TO OUR EXECUTIVE OFFICERS FOR THE YEAR ENDED
DECEMBER 31, 1998.
13
<PAGE>
The Compensation Committee is responsible for establishing Lightbridge's
executive compensation policies and practices, which includes making specific
recommendations to the Board of Directors concerning compensation for executive
officers.
The Compensation Committee seeks to achieve three broad goals in connection
with Lightbridge's executive compensation programs and decisions regarding
individual compensation:
- structuring executive compensation programs in a manner that will enable
Lightbridge to attract and retain key executives;
- rewarding executives for Lightbridge's achievement of net income goals, in
order to create a performance-oriented environment for Lightbridge's
executives; and
- providing executives with an equity interest in Lightbridge so as to link
a portion of the compensation of Lightbridge's executives with the
performance of the common stock.
Lightbridge's executive compensation program generally consists of three
elements: base salary, annual cash bonus, and a stock-based equity incentive in
the form of participation in Lightbridge's stock option plans. The executive
officers are also eligible to participate in other employee benefit plans,
including health and life insurance plans, a 401(k) retirement plan and a stock
purchase plan, on substantially the same terms as other employees who meet
applicable eligibility criteria, subject to any legal limitations on the amounts
that may be contributed or on the benefits that may be payable under these
plans. In establishing base salaries for executives, the Compensation Committee
monitors salaries at other companies, particularly those companies in the same
industry and companies located in the same geographic area as Lightbridge. In
addition, for each executive the Compensation Committee considers historic
salary levels, work responsibilities and base salary relative to other
executives at Lightbridge. To the extent determined to be appropriate, the
Compensation Committee also considers general economic conditions, Lightbridge's
financial performance and each individual's performance.
Lightbridge's approach to the Chief Executive Officer's compensation package
in fiscal 1998 was to be competitive with other high growth companies in the
software industry and to tie a large percentage of the Chief Executive Officer's
total compensation package to Lightbridge's performance. Ms. Reeve is a party to
a multi-year employment agreement with Lightbridge that establishes her annual
base salary during the term of the agreement, subject to increase (but not
decrease) at the discretion of the Board of Directors. Ms. Reeve's base salary
was designed to give her assurance of a base level of compensation, commensurate
with her position and duration of employment with Lightbridge. Ms. Reeve
received a base salary of $235,000 in 1998, $200,000 in 1997 and $165,000 in
1996.
Executive bonuses generally are considered and granted on an annual basis,
with each bonus being paid in three equal annual installments. Payment of each
bonus is subject to the continued employment of the bonus recipient. Lightbridge
typically adopts a target bonus plan for officers and other key employees in the
year immediately preceding the year for which bonuses are to be granted. In the
year immediately following the year for which bonuses are to be granted, the
Compensation Committee evaluates the performances of the officers and other key
employees and determines the extent to which bonuses are to be paid from the
target bonus plan. In accordance with these procedures, in late 1997 Lightbridge
adopted its 1998 target bonus plan and in early 1999 the Compensation Committee
will consider the extent to which bonuses, if any, will be paid out of the 1998
target bonus plan, as compensation for the performance of the officers and other
key employees.
14
<PAGE>
Generally, Lightbridge's policy with respect to option grants to executive
officers is to create a performance incentive for such officers by providing
them the ability to acquire or increase a proprietary interest in Lightbridge
and its success. In determining the size of each stock option grant, the
Compensation Committee emphasized the seniority, responsibilities and
performance of the executive. In 1998, the Compensation Committee granted
options to purchase 300,000 shares to Ms. Reeve, with an exercise price of
$12.125 per share. The Compensation Committee granted these options because Ms.
Reeve's other stock options were fully or substantially vested, and the
Compensation Committee desired to create a continuing incentive for Ms. Reeve to
act on behalf of Lightbridge. As described above under "Report of the
Compensation Committee on Repricing of Options in 1998," however, the options
granted to Ms. Reeve were not included in the general option repricing
authorized by the Board in 1998. The Compensation Committee also granted options
to the executive officers who joined Lightbridge in 1998: Joseph Tibbetts, Brian
Connolly and Carla Marcinowski. During 1999, the Compensation Committee intends
to consider increasing the proportion of overall compensation of certain
executive officers consisting of stock options and other equity-based
incentives.
Section 162(m) of the Internal Revenue Code of 1986 generally disallows a
tax deduction to public companies for compensation over $1,000,000 paid to its
chief executive officer and its four other most highly compensated executive
officers. Qualifying performance-based compensation will not be subject to the
deduction limit if certain requirements are met. In this regard, Lightbridge has
limited the number of shares subject to stock options that may be granted to
Lightbridge employees in a manner that complies with the performance-based
requirements of Section 162(m), but has not sought stockholder approval of the
1998 Non-Statutory Stock Option Plan in order to qualify options granted
thereunder as qualifying performance-based compensation. Based on the
compensation awarded to Lightbridge's executive officers, it does not appear
that the Section 162(m) limitation will have a significant impact on Lightbridge
in the near term. While the Compensation Committee does not currently intend to
qualify its executive bonus awards as a performance-based plan, it will continue
to monitor the impact of Section 162(m) on Lightbridge.
Andrew I. Fillat
Torrence C. Harder
RELATED PARTY TRANSACTIONS
In April 1997 we made a loan to Douglas Blackwell, our Vice President,
Service Delivery, in the form of a promissory note in the principal amount of
$75,000. The promissory note currently bears interest at an annual rate of 7.0%
and will accrue interest at such rate until we demand payment or until Mr.
Blackwell's employment with us terminates for any reason. At such time, the
promissory note will bear interest at an annual rate of the prime rate plus one
percent. As of March 31, 1999, the remaining balance under the promissory note
was $20,000.
In August 1996 we executed an employment agreement with Pamela D.A. Reeve.
We agreed to employ Ms. Reeve as our President and Chief Executive Officer at an
initial base salary of $165,000 per year, which base salary may be increased but
not decreased. The employment agreement is terminable at will by either party,
but if we terminate Ms. Reeve's employment for any reason, other than death or
disability, within one year after a change of control of Lightbridge or if we
terminate her employment at any time without cause, we will be required to
continue to pay her salary for a period of twelve months after such termination.
15
<PAGE>
INFORMATION ABOUT COMMON STOCK OWNERSHIP AND PERFORMANCE
STOCK OWNED BY DIRECTORS, EXECUTIVE OFFICERS AND GREATER-THAN-5% STOCKHOLDERS
The following table sets forth certain information as of April 20, 1999,
with respect to the beneficial ownership of the common stock by (i) each person
that we know owns of record or beneficially more than 5% of the outstanding
common stock, (ii) the Named Officers, (iii) each director, including each
nominee for re-election, and (iv) all current executive officers and directors
as a group. As of April 20, 1999, there were 16,141,514 shares of common stock
outstanding.
<TABLE>
<CAPTION>
NUMBER OF
SHARES RIGHT TO
NAMES AND ADDRESSES OF BENEFICIAL HOLDERS(1) OWNED(2) ACQUIRE(3) PERCENT
- ------------------------------------------------------------------------------- ---------- ---------- -----------
<S> <C> <C> <C>
Advent International Investors II Limited Partnership
Advent Partners Limited Partnership
Global Private Equity II Limited Partnership(4)................................ 2,000,000 -- 12.4%
101 Federal Street
Boston, Massachusetts 02110
Kopp Investment Advisors, Inc.
Kopp Holding Company
LeRoy C. Kopp(5)............................................................... 1,643,098 -- 10.2
7701 France Avenue South, Suite 500
Edina, Minnesota 55435
Massachusetts Financial Services Company(6).................................... 1,519,321 -- 9.4
500 Boylston Street
Boston, Massachusetts 02116
Torrence C. Harder(7).......................................................... 1,379,634 13,333 8.6
Massachusetts Capital Resource Company(8)...................................... 809,958 500,000 7.9
420 Boylston Street
Boston, Massachusetts 02116
Pamela D.A. Reeve(9)........................................................... 493,144 345,109 5.1
D. Quinn Mills(10)............................................................. 381,451 13,333 2.4
Michael A. Perfit(11).......................................................... 283,194 4,000 1.8
Richard H. Antell.............................................................. 16,000 123,400 *
William G. Brown(12)........................................................... 87,200 57,000 *
Douglas E. Blackwell(13)....................................................... 8,300 111,750 *
Andrew I. Fillat(14)........................................................... 5,500 13,333 *
Debora J. Wilson............................................................... -- 6,666 *
All directors and executive officers as a group (12 persons)(15)............... 2,654,423 757,924 20.2
</TABLE>
- ------------------------
* Less than one percent.
16
<PAGE>
(1) The address of our executive officers and directors is in care of us at 67
South Bedford Street, Burlington, Massachusetts 01803.
(2) Unless otherwise noted, each person or group identified possesses sole
voting and investment power with respect to the shares listed, subject to
community property laws where applicable. Excludes shares that may be
acquired through stock option or warrant exercises.
(3) Represents shares that can be acquired through stock option or warrant
exercises through June 19, 1999.
(4) Consists of 1,668 shares held by Advent International Investors II Limited
Partnership, 93,332 shares held by Advent Partners Limited Partnership and
1,905,000 shares held by Global Private Equity II Limited Partnership.
Advent International Corporation is the general partner of Advent
International Investors II Limited Partnership, Advent Partners Limited
Partnership and Advent International Limited Partnership. Advent
International Limited Partnership is the general partner of Global Private
Equity II Limited Partnership. Because Advent International Corporation is
controlled by a group of 4 persons, none of whom may act independently and a
majority of whom must act in concert to exercise voting or investment power
over the holdings of such entity, individually, no individual in this group
is deemed to share such voting or investment power.
(5) The "Number of Shares Owned" is based on information contained in an
amendment to a report on Schedule 13G, filed with the Securities and
Exchange Commission on February 9, 1999. The amended report states that:
- Kopp Investment Advisors, Inc. has sole voting power with respect to
684,000 shares, sole dispositive power with respect to 412,500 shares and
shared dispositive power with respect to 1,081,598 shares;
- Kopp Holding Company has beneficial ownership of 1,494,098 shares; and
- LeRoy C. Kopp has sole voting and dispositive power with respect to
130,000 shares and beneficially owns 1,634,098 shares.
(6) The "Number of Shares Owned" is based on information contained in a report
on Schedule 13G, filed with the Securities and Exchange Commission on
February 11, 1999.
(7) Includes 861,176 shares owned by a trust of which Mr. Harder is the trustee
and beneficiary, 280,000 shares owned by a trust for the benefit of Mr.
Harder's children, 236,683 shares held by Entrepreneurial Ventures, Inc.,
19,500 shares held by the Torrence C. Harder Cultural Foundation, 5,400
shares beneficially owned by Mr. Harder's wife and children and 1,554 shares
held by Entrepreneurial, Inc. Mr. Harder is the President of both
Entrepreneurial, Inc. and Entrepreneurial Ventures, Inc.
(8) William J. Torpey, Jr. is the president and Joan C. McArdle is the vice
president of Massachusetts Capital Resource Company, so that Mr. Torpey and
Ms. McArdle may be deemed to be the beneficial owners of the shares held by
Massachusetts Capital Resource Company.
(9) Includes 25,500 shares held by trusts for the benefit of certain of Ms.
Reeve's children.
(10) Consists of 381,451 shares owned by a profit sharing plan for the benefit
of Dr. Mills.
(11) Includes 267,194 shares and a warrant to purchase 3,000 shares held by a
trust for the benefit of Mr. Perfit.
(12) Includes 12,000 shares held by trusts for the children of Mr. Brown.
(13) Includes 300 shares owned by Mr. Blackwell's wife.
(14) Includes 5,500 shares held by Advent Partners Limited Partnership. Mr.
Fillat holds a limited partnership interest in Advent Partners Limited
Partnership representing beneficial ownership of 5,500 shares. He disclaims
beneficial ownership of the remaining 1,994,500 shares described in Note 4.
(15) Includes the shares described in Notes 7, 9, 10, 11, 12, 13 and 14.
COMPLIANCE WITH REPORTING REQUIREMENTS
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
our executive officers and directors, and persons who own more than ten percent
of a registered class of our equity securities, to report changes in ownership
by filing Form 4 or 5 with the Securities and Exchange Commission. These
executive officers, directors and ten-percent stockholders are also required by
Securities and Exchange Commission rules to furnish us with copies of all
Section 16(a) reports they file. Based solely on our review of the copies of
these forms, we believe that all Section 16(a) reports applicable to our
executive officers, directors and ten-percent shareholders with respect to
reportable transactions during the fiscal year ended December 31, 1998 were
filed on a timely basis.
PERFORMANCE GRAPH
The following graph compares the cumulative total return to stockholders of
our common stock for the period from September 27, 1996 (the effective date of
the registration of our common stock under the Securities Exchange Act of 1934)
to December 31, 1998, to the cumulative total return of the Nasdaq Stock Market
Index and the Nasdaq Computer & Data Processing Services Index for the same
period.
COMPARISON OF TWENTY-SEVEN MONTH CUMULATIVE TOTAL RETURN*
AMONG LIGHTBRIDGE, INC., THE NASDAQ STOCK MARKET INDEX
AND THE NASDAQ COMPUTER & DATA PROCESSING SERVICES INDEX
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NASDAQ COMPUTER
<S> <C> <C> <C>
Nasdaq & Data Processing
Lightbridge,
Stock Market Services Stocks Inc.
Sep-96 100.00 100.00 100.00
Oct-96 98.49 98.32 102.84
Nov-96 104.58 105.37 95.38
Dec-96 104.49 104.07 85.36
Jan-97 111.91 113.51 91.02
Feb-97 105.72 104.31 100.92
Mar-97 98.82 96.60 74.63
Apr-97 101.91 109.20 69.01
May-97 113.46 121.21 82.47
Jun-97 116.93 123.86 78.78
Jul-97 129.27 136.73 113.13
Aug-97 129.08 133.09 125.95
Sep-97 136.71 135.46 153.81
Oct-97 129.63 132.66 165.73
Nov-97 130.28 136.01 144.77
Dec-97 128.19 127.84 156.65
Jan-98 134.25 139.82 173.42
Feb-98 138.31 148.14 159.62
Mar-98 143.55 162.28 180.47
Apr-98 136.30 150.05 159.30
May-98 136.36 151.95 119.26
Jun-98 156.18 194.03 130.90
Jul-98 149.84 166.13 111.01
Aug-98 108.20 122.01 93.65
Sep-98 119.49 142.63 65.06
Oct-98 112.49 125.45 41.29
Nov-98 123.77 148.85 39.45
Dec-98 131.82 168.89 29.05
</TABLE>
17
<PAGE>
* $100 invested on September 27, 1996 in stock or index, including
reinvestment of dividends. Fiscal year ends December 31.
18
<PAGE>
--------------------------------
WHEN PROXY IS OKAY PLEASE SIGN &
DATE IT ABOVE
LIGHTBRIDGE, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
SPECIAL MEETING IN LIEU OF 1999 ANNUAL MEETING OF STOCKHOLDERS - JUNE 9, 1999
The undersigned stockholder of Lightbridge, Inc. (the "Company") hereby
appoints Pamela D.A. Reeve, Joseph S. Tibbetts, Jr. and Alexander H. Pyle and
each or any of them, proxies, with full power of substitution to each and to
each substitute appointed pursuant to such power, of the undersigned to vote
all shares of common stock of the Company that the undersigned may be
entitled to vote at the Special Meeting in Lieu of 1999 Annual Meeting of
Stockholders of the Company to be held on Wednesday, June 9, 1999, and at any
and all adjournments thereof (the "Meeting"), with all powers the undersigned
would possess if personally present. The proxies are authorized to vote as
indicated on the reverse side upon the matter set forth on the reverse side
and in their discretion upon all other matters that may properly come before
the Meeting. The undersigned hereby acknowledges receipt of a copy of the
accompanying Notice of Special Meeting in Lieu of 1999 Annual Meeting of
Stockholders and Proxy Statement for the Meeting and hereby revokes all
proxies, if any, heretofore given by the undersigned to others for said
Meetings.
(IMPORTANT - TO BE SIGNED AND DATED ON REVERSE SIDE)
<PAGE>
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
SPECIAL MEETING IN LIEU OF 1999 ANNUAL MEETING OF STOCKHOLDERS
LIGHTBRIDGE, INC.
JUNE 9, 1999
Please Detach and Mail in the Envelope Provided
<TABLE>
<CAPTION>
A /X/ Please mark your vote
as in this example.
For all nominees WITHHOLD
(except as indicated AUTHORITY to vote
to the contrary at right) for all nominees
<S> <C> <C>
PROPOSAL 1. / / / / Nominees:
ELECTION OF Torrence C. Harder If this proxy, is properly executed and returned, the
DIRECTORS Pamela D.A. Reeve shares represented thereby will be voted. If a choice
is specified with respect to the matter to be acted
upon, the shares will be voted upon this matter in
accordance with the specifications made. IN THE
ABSENCE OF ANY SPECIFICATION, THE SHARES REPRESENTED
BY THIS PROXY WILL BE VOTED FOR PROPOSAL 1.
---
------------------------------------------------------
(INSTRUCTION: To withhold authority to PLEASE MARK, SIGN, DATE AND RETURN CARD PROMPTLY
vote for any individual nominee, strike USING THE ENCLOSED ENVELOPE.
a line through that nominee's name in ------------------------------------------------------
the list at right.)
Signature Date , 1999 Signature Dated: , 1999
---------------- ------- ------------------- --------
Note: Please date, sign exactly as name appears hereon and return promptly. If the shares are registered in the name of two
or more persons, each should sign. Executors, trustees, guardians, custodians, administrators, attorneys and corporate
officers should add their titles.
</TABLE>
