FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, C.C. 20549
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of AUGUST, 1997
TURBODYNE TECHNOLOGIES INC.
(Translation of registrant's name into English)
SUITE 510, 1090 WEST PENDER STREET, VANCOUVER, BC, CANADA, V6E 2N7
(Address of principal executive offices)
[Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
------- ------
[Indicate by check mark whether the registrant by furnishing the
information contained in this form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
Yes No X
-------- --------
[If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b):82
--------------
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
August 1, 1997
Date /S/ LEON NOWEK
----------------------------
Signature
LEON E. NOWEK
-----------------------------
Name
CHIEF FINANCIAL OFFICER
-----------------------------
Title
*Print the name and title of the signing officer under his signature
<PAGE>
TURBODYNE TECHNOLOGIES INC.
NOTICE OF MEETING
AND
PROXY CIRCULAR
FOR THE
ANNUAL GENERAL MEETING
TO BE HELD ON
APRIL 25, 1997
March 18, 1997
<PAGE>
TURBODYNE TECHNOLOGIES INC.
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
===========================================================================
NOTICE is hereby given that the Annual General Meeting of the shareholders
of Turbodyne Technologies Inc. (the "Company") will be held at The Grouse
Room, Hyatt Regency Hotel, 655 Burrard Street, Vancouver, British Columbia,
on Friday, April 25, 1997 at 2:00 p.m. for the following purposes:
1. To receive and consider the Report of the Directors.
2. To receive and consider the audited financial statements of the
Company for the year ended December 31, 1996 together with the auditors'
report thereon.
3. To appoint auditors for the ensuing year and to authorize the
directors to fix the remuneration to be paid to the auditors.
4. To fix the number of directors for the ensuing year at seven.
5. To elect directors for the ensuing year.
6. To approve the granting of stock options to the following insiders of
the Company:
<TABLE>
<CAPTION>
Optionee Number of Shares Exercise Price Expiry Date
- ----------------- ---------------- -------------- -----------------
<S> <C> <C> <C>
Robert F. Taylor 50,000 $9.00 September 3, 1998
Anatoly Mezheritsky 15,000 $9.00 September 3, 1998
Michael Joyce 50,000 $9.00 September 12, 1998
Lennart Renberg 50,000 $9.00 September 12, 1998
Thomas J. Zastera 10,000 $9.00 September 12, 1998
Leon E. Nowek 200,000 $9.85 January 6, 1999
Edward M. Halimi 200,000 $9.85 January 6, 1999
Sadayappa K. Durairaj 80,000 $9.85 January 6, 1999
</TABLE>
7. To approve the Company's 1997 Stock Option Plan and to authorize the
directors to make such changes to the Plan as may be required by the
securities regulatory authorities or to comply with applicable legislation
without further shareholder approval.
<PAGE>
8. To approve by a vote of the disinterested shareholders of the Company,
the Company's 1997 Stock Option Plan and to authorize the directors to make
such changes to the Plan as may be required by the securities regulatory
authorities or to comply with applicable legislation without further
shareholder approval.
9. To approve by a vote of the disinterested shareholders of the Company,
the granting of stock options to insiders of the Company pursuant to the
Company's 1997 Stock Option Plan.
10. To transact such other business as may properly come before the
meeting.
Shareholders unable to attend the Annual General Meeting in person are
requested to read the enclosed Proxy Circular and Proxy, and then complete
and deposit the Proxy together with the power of attorney or other
authority, if any, under which it was signed or a notarially certified copy
thereof with the Company's transfer agent, Montreal Trust Company of
Canada, of 510 Burrard Street, Vancouver, British Columbia, V6C 3B9 at
least 48 hours (excluding Saturdays, Sundays and statutory holidays) before
the time of the meeting or adjournment thereof or with the chairman of the
meeting prior to the commencement thereof. Unregistered shareholders who
received the Proxy through an intermediary must deliver the Proxy in
accordance with the instructions given by such intermediary.
DATED at Vancouver, British Columbia, this 18th day of March, 1997.
ON BEHALF OF THE BOARD OF DIRECTORS
/s/ Edward M. Halimi
--------------------
Edward M. Halimi
Chairman and President
Page 2
<PAGE>
TURBODYNE TECHNOLOGIES INC .
PROXY CIRCULAR
==========================================================================
THIS PROXY CIRCULAR CONTAINS INFORMATION AS AT MARCH 18, 1997.
I. PERSONS MAKING THIS SOLICITATION OF PROXIES
THIS PROXY CIRCULAR IS FURNISHED IN CONNECTION WITH THE SOLICITATION OF
PROXIES BY THE MANAGEMENT OF TURBODYNE TECHNOLOGIES INC. (THE "COMPANY")
FOR USE AT THE ANNUAL GENERAL MEETING (THE "MEETING") OF THE SHAREHOLDERS
OF THE COMPANY TO BE HELD AT THE TIME AND PLACE AND FOR THE PURPOSES SET
FORTH IN THE ACCOMPANYING NOTICE OF MEETING, AND AT ANY ADJOURNMENT
THEREOF. It is expected that the solicitation will be primarily by mail.
Proxies may also be solicited personally by employees of the Company. The
cost of solicitation will be borne by the Company.
II. COMPLETION AND VOTING OF PROXIES
Voting at the Meeting will be by a show of hands, each shareholder having
one vote, unless a poll is requested or required (if the number of shares
represented by proxies that are to be voted against a motion are greater
than 5% of the votes that could be cast at the Meeting), in which case each
shareholder is entitled to one vote for each share held. In order to
approve a motion proposed at the Meeting a majority of greater than 50% of
the votes cast will be required (an "ordinary resolution") unless the
motion requires a special resolution in which case a majority of 66-2/3% of
the votes cast will be required.
The persons named in the accompanying Proxy as proxyholders are directors
or senior officers of the Company. A SHAREHOLDER OR AN INTERMEDIARY
HOLDING SHARES AND ACTING ON BEHALF OF AN UNREGISTERED SHAREHOLDER HAS THE
RIGHT TO APPOINT A PERSON (WHO NEED NOT BE A SHAREHOLDER) TO ATTEND AND ACT
ON HIS BEHALF AT THE MEETING OTHER THAN THE PERSONS NAMED IN THE PROXY AS
PROXYHOLDERS. TO EXERCISE THIS RIGHT, THE SHAREHOLDER OR INTERMEDIARY MUST
STRIKE OUT THE NAMES OF THE PERSONS NAMED IN THE PROXY AS PROXYHOLDERS AND
INSERT THE NAME OF HIS NOMINEE IN THE SPACE PROVIDED OR COMPLETE ANOTHER
PROXY.
A shareholder or intermediary acting on behalf of a shareholder may
indicate the manner in which the persons named in the enclosed Proxy are to
vote with respect to any matter by checking the appropriate space. On any
poll required by virtue of 5% or more of the outstanding shares of the
Company being represented by proxies at the Meeting that are to be voted
against a matter or by a shareholder or proxyholder requesting a poll,
those persons will vote or withhold from voting
<PAGE>
the shares in respect of which they are appointed in accordance with the
directions, if any, given in the Proxy provided such directions are certain.
If the shareholder or intermediary acting on behalf of a shareholder wishes
to confer a discretionary authority with respect to any matter, then the
space should be left blank. IN SUCH INSTANCE, THE PROXYHOLDER, IF ONE
PROPOSED BY MANAGEMENT, INTENDS TO VOTE THE SHARES REPRESENTED BY THE PROXY
IN FAVOUR OF THE MOTION. The enclosed Proxy, when properly signed, also
confers discretionary authority with respect to amendments or variations to
the matters identified in the Notice of Meeting and with respect to other
matters which may be properly brought before the Meeting. At the time of
printing this Circular, the management of the Company is not aware that any
such amendments, variations or other matters are to be presented for action
at the Meeting. If, however, other matters which are not now known to the
management should properly come before the Meeting, the Proxies hereby
solicited will be exercised on such matters in accordance with the best
judgement of the nominees.
The Proxy must be dated and signed by the shareholder or by his attorney
authorized in writing or by the intermediary acting on behalf of a
shareholder. In the case of a corporation, the Proxy must be executed under
its corporate seal or signed by a duly authorized officer or attorney for the
corporation.
COMPLETED PROXIES TOGETHER WITH THE POWER OF ATTORNEY OR OTHER AUTHORITY,
IF ANY, UNDER WHICH IT WAS SIGNED OR A NOTARIALLY CERTIFIED COPY THEREOF
MUST BE DEPOSITED WITH THE COMPANY'S TRANSFER AGENT, MONTREAL TRUST COMPANY
OF CANADA, OF 510 BURRARD STREET, VANCOUVER, BRITISH COLUMBIA, V6C 3B9, AT
LEAST 48 HOURS (EXCLUDING SATURDAYS, SUNDAYS AND STATUTORY HOLIDAYS) BEFORE
THE TIME OF THE MEETING OR ADJOURNMENT THEREOF OR DEPOSITED WITH THE
CHAIRMAN OF THE MEETING PRIOR TO THE COMMENCEMENT THEREOF. UNREGISTERED
SHAREHOLDERS WHO RECEIVED THE PROXY THROUGH AN INTERMEDIARY MUST DELIVER
THE PROXY IN ACCORDANCE WITH THE INSTRUCTIONS GIVEN BY SUCH INTERMEDIARY.
It is not intended to use the proxies for the purpose of voting on the
Company's audited financial statements for the most recently completed
financial year, the directors' reports nor the Auditors' report.
III. REVOCATION OF PROXIES
A shareholder who or an intermediary acting on behalf of a shareholder
which has given a Proxy has the power to revoke it. Revocation can be
effected by an instrument in writing signed by the intermediary or
shareholder or his attorney authorized in writing, and, in the case of a
Page 2
<PAGE>
corporation, executed under its corporate seal or signed by a duly
authorized officer or attorney for the corporation and either delivered to
the registered office of the Company at 12th Floor, 1190 Hornby Street,
Vancouver, British Columbia, V6Z 2L3, at any time up to and including the
last business day preceding the day of the Meeting, or any adjournment
thereof, or deposited with the Chairman of the Meeting on the day of the
Meeting, prior to the hour of commencement.
IV. INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
None of the directors or senior officers of the Company, nor any person who
has held such a position since the beginning of the last completed
financial year of the Company, nor any proposed nominee for election as a
director of the Company, nor any associate or affiliate of the foregoing
persons, has any substantial or material interest, direct or indirect, by
way of beneficial ownership of securities or otherwise, in any matter to be
acted on at the Meeting other than:
10. the election of directors;
11. the approval of stock options granted to insiders of the Company as
further disclosed in Section XI "Particulars of Other Matters to be Acted
Upon - Insiders' Incentive Stock Options";
12. the approval of the 1997 Stock Option Plan, as further disclosed in
Section XI "Particulars of Other Matters to be Acted Upon - Stock Option
Plan" insofar as the directors and officers of the company will be
eligible to be granted options to purchase shares of the Company pursuant
to the Stock Option Plan, approval of all of which will be sought at the
Meeting.
V. VOTING SHARES AND PRINCIPAL HOLDERS THEREOF
The Company has only one class of shares entitled to be voted at the
Meeting, namely, common shares without par value. All issued shares are
entitled to be voted at the Meeting and each has one non-cumulative vote.
There are 23,876,830 common shares issued and outstanding as of March 18,
1997.
Only those common shareholders of record on March 18, 1997 will be entitled
to vote at the Meeting or any adjournment thereof.
To the knowledge of the directors and senior officers of the Company, only
the following persons beneficially own, directly or indirectly, or exercise
control or direction over shares carrying more than 10% of the voting
rights attached to all outstanding shares of the Company which have the
right to vote in all circumstances:
Page 3
<PAGE>
<TABLE>
<CAPTION>
Name and Address Number of Shares Percentage of
Outstanding Shares
- ------------------------- ---------------- ------------------
<S> <C> <C>
March Technologies Inc.(1) 3,250,000(2) 13.64%
1050 North Cindy Lane
Carpinteria, California
USA 93013
</TABLE>
(1) March Technologies Inc. is a company owned and controlled by the
president of Company, Edward M. Halimi.
(2) These shares are held in escrow by Montreal Trust Company of Canada
pursuant to an escrow agreement dated March 7, 1994 between the Company,
Montreal Trust Company of Canada, March Technologies Inc. and Leon E.
Nowek.
VI. ELECTION OF DIRECTORS
The management proposes to nominate the persons named in the following
table for election as directors of the Company. Each director elected will
hold office until the next Annual General Meeting or until his successor is
duly elected or appointed, unless his office is earlier vacated in
accordance with the Bylaws of the Company or he becomes disqualified to act
as a director.
It is proposed to elect seven directors at the Meeting. This requires the
number of directors to be set at seven (subject to the Board's power to
increase the number of directors between annual general meetings by
one-third of the number of directors elected at the previous annual general
meeting) which requires the approval of the shareholders of the Company by
an ordinary resolution, which approval will be sought at the Meeting.
The following information concerning the proposed nominees has been
furnished by each of them.
Page 4
<PAGE>
<TABLE>
<CAPTION>
Name and Country in
Present Which
Position with Present Principal Previously Shares Ordinarily
the Company Occupation(1) a Director Owned(2) Resident
============= ================= ========== ======== ==========
<S> <C> <C> <C> <C>
Edward M. President of the Since 3,250,000 United
Halimi(6) Company. October 18, common States
President & President of 1993 shares(4)
Director Turbodyne
Systems, Inc.
===========================================================================
Leon E. Nowek Chief Financial Since 917,354 Canada
(3)(6) Officer of the October 18, common
Chief Financial Company. Director 1993 shares(5)
Officer & of New Westwin
Director Ventures Inc.
===========================================================================
Daniel Geronazzo Barrister and Since Nil Canada
(3) Solicitor January 24,
Director (retired). 1995
===========================================================================
Wendell R. Attorney with Since Nil United
Anderson Larkin, Hoffman, November 20, States
Director Daly & Lindgren 1995
Ltd. of
Bloomington,
Minnesota,
Director of
National City
Bank Corporation
and Director of
Fingerhut
Corporation.
===========================================================================
Eugene A. Self-employed Since 1,000 Canada
Hodgson(6) management April 25, common
Director consultant. 1996 shares
Director of
New Westwin 50,000
Ventures Inc. Series "A"
Previously Special
Director of Warrants
Corporate
Development at
Intrawest
Corporation for
five years.
Currently
Director of the
Vancouver Board
of Trade and
Chair of its
communications
committee.
===========================================================================
Page 5
<PAGE>
Robert F. Chartered Since 1,000 Canada
Taylor(3)(6) Accountant. July 15, common
Director and Chief Operating 1996 shares
Chief Officer of the
Operating Company as of
Officer January 1, 1997.
Former director
of Shell Canada
Limited (1992-
1996) Former
President of
Shell Canada
Products Limited
(1993-1996).
Formerly employed
by Shell from
1967-1996 in
Calgary, Toronto
and London,
England.
===========================================================================
Sadayappa K. Cardiologist and Since 676,967 United
Durairaj businessman based September common States
Director in California. 16, 1996 shares
President and
C.E.O. of the
Pacifica Hospital
and Sierra Medical
Clinic. Chairman
of Brentwood Bank
(Caifornia) and
VSK Ferro Alloys
(India).
===========================================================================
</TABLE>
(1) Includes occupations for preceding five years unless the director
was elected at the previous Annual General Meeting and was shown as
a nominee for election as a director in the Information Circular
for that meeting.
(2) The approximate number of shares of the Company carrying the right
to vote in all circumstances beneficially owned, directly or
indirectly, or over which control or direction is exercised by each
proposed nominee as of March 18, 1997. Does not include shares
which may be acquired upon the exercise of stock options and
warrants as follows: Leon Nowek - 200,000 shares, Edward Halimi -
200,000 shares, Eugene Hodgson - 123,000 shares (73,000 upon
exercise of options and 50,000 upon exercise of Series A Ordinary
Warrants), Daniel Geronazzo - 115,000 shares, Robert Taylor -
50,000 shares, Wendell Anderson - 50,000 shares.
(3) Member of the Audit Committee.
(4) Of which 3,250,000 are held in escrow by Montreal Trust Company of
Canada.
(5) Of which 900,000 are held in escrow by Montreal Trust Company of
Canada.
(6) Member of Executive Committee
The Company's Executive Committee consists of: Leon E. Nowek, Edward M.
Halimi, Robert F. Taylor and Eugene A. Hodgson. Pursuant to the provisions
of the CANADA BUSINESS CORPORATIONS ACT the Company is required to have an
Audit Committee whose members are indicated above.
Page 6
<PAGE>
VII. REMUNERATION OF MANAGEMENT
AND EXECUTIVE COMPENSATION
EMPLOYMENT AND OTHER AGREEMENTS
Edward M. Halimi is party to an employment agreement dated March 14, 1994
between the Company, Mr. Halimi, and Turbodyne Systems, Inc. ("Turbodyne
Systems"), a subsidiary of the Company. Mr. Halimi is employed as
President and Chief Executive Officer of the Company and Turbodyne Systems
under the employment agreement. The employment agreement has a five year
term. Mr. Halimi is paid a salary of US $60,000 per year and is entitled
to participate in share option plans, share purchase plans and other
financial assistance plans at the discretion of the Board of Directors of
the Company. Mr. Halimi is entitled to terminate the employment agreement
upon three months written notice to the Company.
The Company has retained Robert Taylor, a director of the Company, as Chief
Operating Officer of the Company pursuant to a consultant agreement between
the Company and Mr. Taylor dated January 1, 1997. Mr. Taylor will be based
at the office of Turbodyne Systems in Carpinteria, California and will be
responsible for managing the day to day operations of the Company and
providing direction on the business and financial affairs of the Company.
The consultant agreement has an initial six month term with automatic
renewals for additional six month terms unless Mr. Taylor or the Company
elects not to renew. Mr. Taylor is paid a consultant fee of Cdn. $20,833
per month. In addition, the Company has agreed to grant to Mr. Taylor
options to acquire 100,000 shares of the Company at prices determined in
accordance with the policies of the Vancouver Stock Exchange. Thereafter,
Mr. Taylor will be eligible for grants of additional options as a director
and officer of the Company.
Michael Joyce is party to an employment agreement with Pacific Baja Light
Metals and the Company dated September 5, 1996 whereby he is employed as
President of Pacific Baja Light Metals Corp., a subsidiary of the Company
("Pacific Baja Light Metals"). The employment agreement has a three year
term. Mr. Joyce is paid a base salary of US $12,500 per month plus an
annual cash bonus based on the annual net operating profit of Pacific Baja
Light Metals. The maximum bonus payable is 150% of base salary which is
earned upon the annual net operating profit of Pacific Baja Light Metals
exceeding US $5,500,000. Mr. Joyce is also entitled to receive options to
purchase 50,000 shares of the Company upon the completion of each
anniversary of the execution of the employment agreement.
The consulting services of Lennart Renberg are provided to Pacific Baja
Light Metals pursuant to a consulting agreement between Pacific Baja, the
Company and Lykar Specialties, Inc. ("Lykar Specialties") dated September
5, 1996. The consulting agreement has a three year term. Pacific Baja pays
a base consulting fee for Mr. Renberg's services equal to US $12,500 per
month plus an annual bonus based on the annual net operating profit
Page 7
<PAGE>
of Pacific Baja Light Metals. The maximum bonus payable is 150% of base
salary and is earned upon the annual net operating profit of Pacific Baja
Light Metals exceeding US $5,500,000. Options to purchase 50,000 shares of
the Company are also to be issued to Lykar Specialties upon each
anniversary of the term of the consulting agreement.
Dr. William Woollenweber is employed as Vice-President-Turbocharger
Technology of Turbodyne Systems pursuant to an employment agreement between
Dr. Woollenweber and Turbodyne Systems dated September 1, 1995. Dr.
Woollenweber was paid an initial salary of US.$120,000 per annum for the
initial three year term of the employment agreement. The salary was
increased to $158,400 per annum as of January 1997. Dr. Woollenweber
provides engineering services related to the design and development for
turbocharger and turbocharging systems as applied to internal combustion
engines in connection with the Company's Turbodyne products.
David Willett is employed as Vice-President-Electronics and Controller
Technology of Turbodyne Systems pursuant to an employment agreement dated
January 30,1996 between Mr. Willett and Turbodyne Systems. Mr. Willett was
paid an initial salary of $110,000 for the initial three year term of the
employment agreement. The salary was increased to $130,000 per annum as of
January 1997. Mr. Willett provides engineering services in connection with
electronic and controller technology for the Company's Turbodyne products.
Ralph Maloof is employed as Vice-President and Chief Engineer of Turbodyne
Systems pursuant to an employment agreement between Mr. Maloof and
Turbodyne Systems. Mr. Maloof is paid a salary of US $120,000 per annum.
Mr. Maloof provides engineering services to the Company as chief of
engineering for Turbodyne Systems.
Hanan Cohen is employed as Vice-President-Manufacturing and Procurement of
Turbodyne Systems pursuant to an employement agreement between Mr. Cohen
and Turbodyne Systems. Mr. Cohen is paid a salary of US $120,000 per
annum. Mr. Cohen provides engineering services to the Company in
connection with the manufacture and procurement of materials and products
for the Company's Turobdyne products.
PENSION PLANS
- -------------
The Company does not have any pension plans.
COMPENSATION OF DIRECTORS
- -------------------------
The services of Leon Nowek, a director of the Company, are provided to the
Company pursuant to a management agreement dated August 1, 1994 between the
Company and Seeds Investment Corporation ("Seeds"), a private company
controlled by Mr. Nowek. The Company pays a management fee of $2,500 per
month in consideration of Seeds providing the services of Mr. Nowek as
Chief Financial Officer of the Company.
Page 8
<PAGE>
The services of Eugene Hodgson, a director of the Company, are provided to
the Company pursuant to an agreement between the Company and E.A. Hodgson &
Associates Inc. The Company pays a monthly consultant fee of $8,916 per
month in consideration for E.A. Hodgson & Associates Inc. providing the
consultant services of Mr. Hodgson in connection with providing investor
relations and corporate finance advice to the Company.
The Company pays to Wendell Anderson, a director of the Company, a
consultants's fee of US $1,000 per month in connection with the services
provided by Mr. Anderson as a director of the Company.
Except as described above, the Company does not have any arrangements
pursuant to which directors are remunerated by the Company or its
subsidiaries for their services in their capacities as directors, other
than options to purchase shares of the Company which are granted to the
Company's directors from time to time.
DIRECTORS' AND OFFICERS' LIABILITY INSURANCE
- --------------------------------------------
The Company obtained in January 1997, an insurance policy insuring the
directors and officers of the Company and its subsidiaries against any
liability incurred by them in the course of acting as a director or
officer. The policy is for a maximum amount of US $10 million and has a US
$125,000 deductible for all US Securities and Exchange Commission matters
and a US $50,000 deductible for all other matters. The annual premium for
this policy is US $124,000 plus taxes and fees for a total yearly cost of
US $126,423. The insurance does not cover the directors or officers where
the liability relates to the director's or officer's failure to act
honestly and in good faith with a view to the best interests of the
Company.
Prior to January 1997, the Company had no liability insurance in place
insuring the directors and officers of the Company.
COMPENSATION SUMMARY
- --------------------
The following table discloses the compensation paid during the previous
three financial years to the Company's Chief Executive Officer and four
highest paid executive officers (if they earned more than $100,000 per
year):
Page 9
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Name and Year Annual Compensation Long Term Compensation All Other
Principal Compen-
Position ========================================================== sation($)
Salary Bonus Other Awards Payouts
($)(U.S.) ($) Annual ================================
Compen- Securi- Restricted LTIP
sation ties Shares or Payouts($)
($) Under Restricted
Options/ Share/Units
SARs ($)
Granted
(#)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
========================================================================================================
Edward M. 1996 $60,000 nil nil nil nil nil nil
Halimi
President
of Turbodyne 1995 $60,000 nil nil 500,000 nil nil nil
Technologies Inc.
and Turbodyne
Systems, Inc. 1994 $60,000 nil nil nil nil nil nil
=========================================================================================================
Michael Joyce 1996 $75,000 $75,000 nil 50,000 nil nil nil
President of
Pacific Baja 1995 n/a n/a n/a n/a n/a n/a n/a
Light Metals
Corp. 1994 n/a n/a n/a n/a n/a n/a n/a
===========================================================================================================
Lennart Renberg 1996 $75,000 $75,000 nil 50,000 nil nil nil
Director of
Pacific Baja 1995 n/a n/a n/a n/a n/a n/a n/a
Light Metals
Corp. 1994 n/a n/a n/a n/a n/a n/a n/a
===========================================================================================================
William 1996 $123,200 nil nil nil nil nil nil
Wollenweber
Vice-President of
Turbocharger 1995 $ 40,000 nil nil 50,000 nil nil nil
Technology of
Turbodyne Systems,
Inc. 1994 n/a n/a n/a n/a n/a n/a n/a
===========================================================================================================
David Willett 1996 $104,500 nil nil 35,000 nil nil nil
Vice-President of
Electronics and 1995 $110,000 nil nil nil nil nil nil
Controller of
Turbodyne
Systems, Inc. 1994 n/a n/a n/a n/a n/a n/a n/a
===========================================================================================================
Ralph Maloof 1996 $112,300 nil nil nil nil nil nil
Vice-President,
Chief of 1995 $120,000 nil nil 200,000 nil nil nil
Engineering of
Turbodyne
Systems, Inc. 1994 n/a n/a n/a n/a n/a n/a n/a
===========================================================================================================
Hanan Cohen 1996 $112,300 nil nil nil nil nil nil
Vice-President of
Manufacturing 1995 $ 25,000 nil nil 75,000 nil nil nil
and Procurement
of Turbodyne
Systems, Inc. 1994 n/a n/a n/a n/a n/a n/a n/a
===========================================================================================================
</TABLE>
Page 10
<PAGE>
STOCK OPTIONS
- -------------
During the financial year ended December 31, 1996, the Company was
entitled to grant, pursuant to the policies of the Vancouver Stock
Exchange, stock options to its directors and employees or to employees
of a company providing management services to the Company in
consideration of them providing their services to the Company. The
number of shares subject to each option is determined by the Company's
Board of Directors within the guidelines established by such regulatory
authority. The options enable such persons to purchase shares of the
Company at a price fixed pursuant to the rules of such regulatory body.
The option agreements must provide that the option can only be exercised
by the optionee and only so long as the optionee shall continue in the
capacity as a director or employee of the Company or within a period of
not more than 30 days after ceasing to be a director or employee or, if
the optionee dies, within one year from the date of the optionee's
death. The options are exercisable by the optionee giving the Company
notice and payment of the exercise price for the number of shares to be
acquired. The agreements further provide that shareholder approval will
be obtained prior to exercise of options granted to insiders.
During the financial year ended December 31, 1996, the Company did not
have a formal stock option plan. The Board of Directors has approved a
stock option plan which is subject to the approval of the shareholders
and the Vancouver Stock Exchange as described in Section XI herein -
"Particulars of Other Matters to be Acted Upon - Stock Option Plan".
The following table discloses the particulars of options or stock
appreciation rights ("SARs") granted during the preceding financial year
to the Company's Chief Executive Officer and four highest paid executive
officers (if they earned more than $100,000 per year):
OPTION/SAR GRANTS
DURING THE MOST RECENTLY COMPLETED FINANCIAL YEAR
<TABLE>
<CAPTION>
% of Total
Securities Options/ Market Value of
Under SAR's Granted to Exercise or Base Securities Underyling
Options/SARs Employees in Price Options/SARs on the Date
Name Year Granted (#) Financial Year ($/Security) of Grant($/Security) Expiration Date
==== ==== ============ ================ ================ ======================== ===============
<S> <C> <C> <C> <C>
Edward M. Halimi 1996 Nil Nil N/A N/A N/A
President
Michael Joyce 1996 50,000 3.73% $9.00 $9.00 September 12, 1998
Lennart Renberg 1996 50,000 3.73% $9.00 $9.00 September 12, 1998
William Woollenweber 1996 Nil Nil N/A N/A N/A
David T. Willett 1996 35,000 2.61% $7.13 $7.13 February 27, 1998
Hanan Cohen 1996 Nil Nil N/A N/A N/A
Ralph P. Maloof 1996 Nil Nil N/A N/A N/A
</TABLE>
Page 11
<PAGE>
The following table discloses the particulars of stock options exercised
during the preceding financial year by the Company's Chief Executive
Officer and four highest paid executive officers (if they earned more
than $100,000 per year):
AGGREGATED OPTION/SAR EXERCISES
DURING THE MOST RECENTLY COMPLETED
FINANCIAL YEAR AND FINANCIAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION> Value of Unexercised in
Unexercised the Money Options/
Securities Options/SARs at FY- SARs at FY-End ($)
Acquired on Aggregate Value End(#) (Exercisable/ (Exercisable/
Name Year Exercise (#) Realized ($) Unexercisable) Unexercisable)
===== ==== ============ ============== =================== ========================
<S> <C> <C> <C> <C> <C>
Edward M. Halimi 1996 1000 $11,330 Nil Nil
President
Michael Joyce 1996 Nil N/A 50,000 $ 50,000
Lennart Renberg 1996 Nil N/A 50,000 $ 50,000
William Woollenweber 1996 Nil N/A 50,000 $ 262,500
David Willett 1996 Nil N/A 35,000 $ 100,450
Hanan Cohen 1996 Nil N/A 75,000 $ 400,500
Ralph Maloof 1996 Nil Nil 200,000 $1,050,000
</TABLE>
INDEBTEDNESS OF DIRECTORS AND OFFICERS
- --------------------------------------
With the exception of indebtedness of Edward Halimi, as disclosed below,
none of the current or former directors, executive officers or senior
officers of the Company or persons who were directors, executive
officers or senior officers of the Company at any time during the
Company's last completed financial year. In addition, none of the
proposed nominees for election as directors of the Company and none of
the associates of such persons are or have been indebted to the Company
or its subsidiaries at any time since the beginning of the Company's
last completed financial year except as set out on the following table.
Furthermore, none of such persons were indebted to a third party during
such period where their indebtedness was the subject of a guarantee,
support agreement, letter of credit or other similar arrangement or
understanding provided by the Company or its subsidiaries.
Page 12
<PAGE>
TABLE OF INDEBTEDNESS OF DIRECTORS,
EXECUTIVE OFFICERS AND SENIOR OFFICERS
<TABLE>
<CAPTION>
Financially
Amount Assisted
Largest Outstanding Securities
Involvement of Amount as at Purchase Security
Name and Issuer or Outstanding December 31/96 During 1996 for
Principal Position Subsidiary During 1996 ($) (#) Indebtedness
(a) (b) (c) (d) (e) (f)
================== ============= =========== ============= ========== ============
<S> <C> <C> <C> <C> <C>
Edward M. Halimi, Loan from the
President and Company $112,984 $112,984 Nil Nil
Chief Executive
Officer
</TABLE>
The Company has loaned $112,984 to Edward Halimi, the President
and Chief Executive Officer of the Company. The loan is
repayable on demand by the Company and does not bear interest.
COMPOSITION OF THE COMPENSATION COMMITTEE
- ----------------------------------------------------------------
During the Company's last financial year ended December 31, 1996,
the Company did not have a Compensation Committee.
At a meeting of the Board of Directors held on September 24,
1996, the Company approved the formation of a compensation
committee consisting of Daniel D. Geronazzo, Wendell R. Anderson
and Eugene A. Hodgson. The mandate of the Compensation Committee
is to make recommendations to the Board with respect to
compensation to be paid to the Company's directors and senior
officers of the Company. The Board has asked the Compensation
Committee to review the remuneration paid to Edward M. Halimi as
President and Chief Executive Officer and to Seeds Investment
Corporation in consideration of the services of Leon Nowek as
Chief Financial Officer. The Compensation Committee expects to
submit its report in 1997 and has advised the Board that the
remuneration payable in respect of Mr Halimi and Mr. Nowek's
services will increase substantially in 1997. The Compensation
Committee will make comparisons to other companies in the same
industry carrying on businesses similar to those of the Company,
determining this remuneration.
As of the date of this proxy circular, the Compensation Committee
had not completed its review or made any recommendations.
Page 13
<PAGE>
REPORT ON EXECUTIVE COMPENSATION
- --------------------------------
During the last financial year, the Board of Directors considered
a number of factors in fixing remuneration for directors and
executive officers. The Board of Directors primarily based such
remuneration on their determination of what level of remuneration
would be necessary to attract and retain people having the
experience and ability of the executive officers. No emphasis
was given to the stock options held by such executive officers in
determining their cash remuneration. Furthermore, no
consideration was given to options presently held by such
executive officers in considering whether to grant new options to
them. The Company's financial performance was not closely
related to the remuneration paid to such executive officers.
PERFORMANCE GRAPH
- -----------------
The following graph compares the yearly percentage change in the
Company's cumulative total shareholder return on its common
shares (being the percentage increase (or decrease) in the
trading price of its common shares on a yearly basis based on an
investment in the Company's shares on April 25, 1994, the date on
which the Company's shares first traded under the name of
Turbodyne Technologies Inc.) with the cumulative total
shareholder return of the Vancouver Stock Exchange Index and the
Toronto Stock Exchange 300 Index. For comparison purposes, it is
assumed that Cdn. $100 had been invested in the Company's shares
and in the securities contained in such indices on April 25,
1994.
Page 14
<PAGE>
PERFORMANCE GRAPH
Page 15
<PAGE>
VIII. INTEREST OF MANAGEMENT AND
INSIDERS IN MATERIAL TRANSACTIONS
None of the directors or senior officers of the Company, nor any
proposed nominee for election as a director of the Company, nor
any person who beneficially owns, directly or indirectly, shares
carrying more than 10% of the voting rights attached to all
outstanding shares of the Company, nor any associate or affiliate
of the foregoing persons has any material interest, direct or
indirect, in any transaction since the commencement of the
Company's last completed financial year or in any proposed
transaction which, in either case, has or will materially affect
the Company except as follows and as disclosed herein:
The Company acquired Pacific Baja Light Metals effective July 2,
1996, pursuant to an acquisition agreement dated March 15, 1996
between the Company, Pacific Baja Light Metals Holding Inc.
("Pacific Baja"), and the principal shareholders of Pacific Baja.
The Company acquired all of the issued and outstanding shares of
Pacific Baja for total consideration paid on closing to the
shareholders of Pacific Baja consisting of a cash payment of US
$12,000,670 and the issue of 3,076,923 common shares of the
Company at a deemed price of US $5.85 per share. The purchase
price of Pacific Baja was established by arms length negotiation
between the Company and the shareholders of Pacific Baja. Each
of Michael Joyce, Lennart Renberg, Sadayappa K. Durairaj and
Thomas A. Zastera was a former shareholder of Pacific Baja and
received the following consideration on closing of the Company's
acquisition of Pacific Baja:
<TABLE>
<CAPTION>
Name of Shareholder of Pacific Number of Shares of Turbodyne
Baja and Current Position of Technologies Inc. received Cash Consideration received at
the Company At closing closing
============================== ============================= ==============================
<S> <C> <C>
Michael Joyce,
President and
Director
of Pacific Baja Light Metals 419,615 $ 1,636,500 U.S.
Lennart Renberg,
Director of Pacific
Baja Light Metals 386,058 $ 1,505,600 U.S.
Sadayappa K. Durairaj,
Director of the Company 609,457 $ 2,376,900 U.S.
Thomas A. Zastera,
Vice-President of
Pacific Baja Light Metals 25,309 $ 98,700 U.S.
</TABLE>
Page 16
<PAGE>
IX. REMUNERATION AND APPOINTMENT OF AUDITORS
The persons named in the enclosed Proxy will vote for the
appointment of Morgan & Company, Chartered Accountants, of Suite
1730, 700 West Georgia Street, Vancouver, British Columbia, as
auditors for the Company to hold office until the next Annual
General Meeting of the shareholders, at a remuneration to be
fixed by the directors. Morgan & Company were appointed auditors
of the Company on March 8, 1994.
X. MANAGEMENT CONTRACTS
The Company is party to a management services agreement with
Centrepoint Equities Inc. ("Centrepoint"), whereby the Company
pays Centrepoint $2,500 per month in consideration of Centrepoint
providing office space and secretarial and reception services to
the Company. During the fiscal year ended December 31, 1996 a
total of $30,000 was paid or is payable to Centrepoint pursuant
to this agreement. Centrepoint is a non-reporting British
Columbia company, the shares of which are owned by Leon E. Nowek,
a director of the Company.
XI. PARTICULARS OF OTHER MATTERS TO BE ACTED UPON
INSIDERS' INCENTIVE STOCK OPTIONS
- ---------------------------------
At the Meeting, approval of the shareholders will be sought for
the following options to purchase shares granted to insiders of
the Company since the date of the last annual general meeting of
the Company. The policies of the Vancouver Stock Exchange
require that options granted to insiders must be approved by the
Company's shareholders prior to such options being exercised.
Such approval is being sought at the Meeting.
<TABLE>
<CAPTION>
Optionee Number of Shares Exercise Price Expiry Date
======== ================ ============== ===========
<S> <C> <C> <C>
Robert F. Taylor 50,000 $9.00 September 3, 1998
Anatoly Mezheritsky 15,000 $9.00 September 3, 1998
Michael Joyce 50,000 $9.00 September 12, 1998
Lennart Renberg 50,000 $9.00 September 12, 1998
Thomas J. Zastera 10,000 $9.00 September 12, 1998
Leon E. Nowek 200,000 $9.85 January 6, 1999
Edward M. Halimi 200,000 $9.85 January 6, 1999
Sadayappa K. Durairaj 80,000 $9.85 January 6, 1999
</TABLE>
Page 17
<PAGE>
<PAGE>
STOCK OPTION PLAN
- -----------------
By a resolution dated March 3, 1997, the Board of Directors of
the Company established an incentive Stock Option Plan (the
"Stock Option Plan"). The purpose of the Stock Option Plan is to
attract and motivate the directors, officers and employees of the
Company and the Company's subsidiaries and to give them a greater
interest as shareholders in the success of the Company. Adoption
of the Stock Option Plan by the Company requires the approval of
the Vancouver Stock Exchange and the approval of the shareholders
of the Company. The Company has applied to the Vancouver Stock
Exchange for approval of the Stock Option Plan. Approval of the
Stock Option Plan by the shareholders of the Company is being
sought at the Meeting by way of an ordinary resolution.
The Stock Option Plan authorizes the Board of Directors to grant
stock options to the directors officers and employees of the
Company and its subsidiaries (the "Participants") on the
following terms:
1. The Board of Directors of the Company will appoint a
committee (the "Stock Option Committee") of at least two
directors to administer the Stock Option Plan. The Stock
Option Committee will have full and final authority in its
discretion, subject to the provisions of the Stock Option
Plan, to determine the Participants who are to receive stock
options and the number of shares and purchase price of the
shares to be covered by each option.
2. The aggregate number of shares of the Company's common
shares which may be issued upon the exercise of all
outstanding options shall not exceed 2,840,000 common shares
(approximately 11.5% of the issued and outstanding shares of
the Company as of March 18, 1997).
3. Options may be granted under the Stock Option Plan to any
Participant. In determining the Participants to whom
options shall be granted and the number of shares to be
covered by each option, the Stock Option Committee may take
into account the nature of services provided by the
respective Participants, their present and potential
contributions to the Company's success and other factors as
the Committee in its discretion shall deem relevant.
4. The option price per share with respect to each option shall
be determined by the Stock Option Committee but shall in no
instance be less than the fair market value of the shares of
the Company, determined as the average closing price for the
common shares of the Company for the ten trading days
preceding the date of grant.
5. The Stock Option Committee shall determine the expiration
date of each option provided that such expiration date shall
not be more than ten years from the date of the grant of
each option.
Page 18
<PAGE>
6. Options granted under the Stock Option Plan to Participants,
other than the President, Chief Executive Officer, the Chief
Financial Officer, the Chief Operating Officer, Secretary
and any directors of the Company or its subsidiaries, shall
be subject to a vesting formula. The vesting formula will
provide that options will vest equally over a three year
period so that options can only be exercised as to an
aggregate of 33.3% in the first year, 66.6% in the second
year and 100% in the third year and every year thereafter.
No option grants to an employee of the Company or an
affiliate of the Company shall be exercisable until the
Participant has been employed by the Company or a subsidiary
for a period of six months. The directors have the
discretion to waive the vesting requirements at their
discretion in appropriate circumstances.
7. In the event of the termination of the employment of an
employee to whom an option has been granted under the Stock
Option Plan, other than termination for cause, voluntary
termination of the part of the employee without the consent
of the Company or termination by reason of death, the
employee will be entitled to exercise any outstanding
options at any time within thirty days of such termination.
In the event of the termination of the employment of an
employee to whom an option has been granted under the Stock
Option Plan is either for cause or is a voluntary
termination on the part of the employee without the written
consent of the Company, any option held by the employee
under the stock option plan will terminate on the date of
such termination of employment. In the event an employee to
whom an option has been granted dies, the executor or
administrator of the optionee's estate will be entitled to
exercise the options for a period of one year after the date
of death of the employee, but not after the exercise
termination date set forth in the relevant stock option
agreement.
8. If approved by the Board of Directors of the Company and if
permitted by applicable law, the Company may lend money or
guarantee loans by third parties to an individual to finance
the exercise of any options granted under the Stock Option
Plan.
The policies of the Vancouver Stock Exchange require that the
Stock Option Plan be approved by the shareholders of the Company
prior to the exercise of any stock options granted pursuant to
the Stock Option Plan. Following approval by the shareholders of
the Stock Option Plan, any options granted or amendments made to
options previously granted pursuant to the Stock Option Plan will
not require prior approval of the Vancouver Stock Exchange. Any
amendments to the Stock Option Plan must be approved by the
shareholders of the Company prior to becoming effective.
Page 19
<PAGE>
DISINTERESTED SHAREHOLDER APPROVAL OF 1997 STOCK OPTION PLAN
- ------------------------------------------------------------
At the Meeting, the approval of the disinterested shareholders of
the Company will be sought for the 1997 Stock Option Plan. The
policies of the Vancouver Stock Exchange require that "the
disinterested shareholders of a company approve a stock option
plan if the stock option plan could result at any time in:
a. The number of shares reserved for issuance pursuant to stock
options granted to insiders of the Company exceeding 10% of
the company's issued and outstanding shares;
b. The issuance to insiders of the company, within a one year
period, of a number of shares exceeding 10% of the Company's
issued and outstanding shares; or
c. The issuance to any one insider of the Company, and such
insiders' associates, within a one year period of a number
of shares exceeding 5% of the Company's issued and
outstanding shares."
As the Stock Option Plan for which approval is being sought at
the Meeting does not contain a limitation on the shares reserved
for issuance pursuant to stock options granted to insiders of the
Company, the Board of Directors are seeking the approval of the
disinterested shareholders of the Company in order to comply with
the policies of the Vancouver Stock Exchange.
The disinterested shareholders of the Company include all
shareholders of the Company other than insiders of the Company
and their associates.
STOCK OPTIONS GRANTED TO INSIDERS UNDER THE 1997 STOCK OPTION PLAN
- ------------------------------------------------------------------
At the Meeting, the approval of the shareholders will be sought
for the granting of options to insiders of the Company pursuant
to the 1997 Stock Option Plan.
Page 20
<PAGE>
OTHER MATTERS
- -------------
The management does not know of any other matters to come before
the Meeting other than those referred to in the Notice of
Meeting. Should any other matters properly come before the
Meeting, the shares represented by the Proxy solicited hereby
will be voted on such matters in accordance with the best
judgment of the persons voting the Proxy.
The undersigned hereby certifies that the contents and the
sending of this management proxy circular have been approved and
authorized by the directors of the Company.
DATED at Vancouver, British Columbia, this 18th day of March,
1997.
ON BEHALF OF THE BOARD OF DIRECTORS
/s/ Edward M. Halimi
Edward M. Halimi
Chairman and President
Page 21
<PAGE>
TURBODYNE TECHNOLOGIES INC.
(the "Company")
PROXY
FOR THE ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD FRIDAY, APRIL 25, 1997
- -----------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE MANAGEMENT OF THE COMPANY.
The undersigned, being a shareholder of Turbodyne Technologies
Inc. (the "Company"), hereby appoints Edward M. Halimi, President
and a director of the Company, or failing him, Leon E. Nowek,
Chief Financial Officer and a director of the Company, or,
alternatively, _________________, as proxyholder, to attend the
Annual General Meeting of the Company to be held on Friday, April
25, 1997, and at any adjournment thereof and to vote the shares
in the capital of the Company held by the undersigned with
respect to the matters set forth below as follows:
(a) Appointment of Morgan & Company, Chartered Accountants, as
auditors and authorizing the directors to fix the
remuneration to be paid to the auditors.
VOTE FOR WITHHOLD VOTE
-------- --------
(b) Fixing the number of directors for the ensuing year at
seven.
IN FAVOUR AGAINST
-------- --------
(c) Election of the Board of Directors as follows:
Edward M. Halimi VOTE FOR WITHHOLD VOTE
-------- --------
Leon E. Nowek VOTE FOR WITHHOLD VOTE
-------- --------
Daniel D. Geronazzo VOTE FOR WITHHOLD VOTE
-------- --------
Wendell R. Anderson VOTE FOR WITHHOLD VOTE
-------- --------
Eugene A. Hodgson VOTE FOR WITHHOLD VOTE
-------- --------
Robert F. Taylor VOTE FOR WITHHOLD VOTE
-------- --------
Sadayappa K. Durairaj VOTE FOR WITHHOLD VOTE
-------- --------
<PAGE>
(d) Granting of stock options to the following insiders:
Robert F. Taylor IN FAVOUR AGAINST
-------- --------
Anatoly Mezheritsky IN FAVOUR AGAINST
-------- --------
Michael Joyce IN FAVOUR AGAINST
-------- --------
Lennart Renberg IN FAVOUR AGAINST
-------- --------
Thomas J. Zastera IN FAVOUR AGAINST
-------- --------
Leon E. Nowek IN FAVOUR AGAINST
-------- --------
Edward M. Halimi IN FAVOUR AGAINST
-------- --------
Sadayappa K. Durairaj IN FAVOUR AGAINST
-------- --------
(e) The adoption of the Company's 1997 Stock Option Plan and
authorizing the directors to amend the Plan as may be
required by the securities regulatory authorities.
IN FAVOUR AGAINST
-------- --------
[(F) AND (G) - DISINTERESTED SHAREHOLDERS ONLY]
(f) The adoption by the disinterested shareholders of the
Company of the Company's 1997 Stock Option Plan and
authorizing the directors to amend the Plan as may be
required by the securities regulatory authorities.
IN FAVOUR AGAINST
-------- --------
(g) The approval by the disinterested shareholders of the
Company of granting of stock options to insiders of the
Company, pursuant to the Company's 1997 Stock Option Plan.
IN FAVOUR AGAINST
-------- --------
Page 2
<PAGE>
(h) With respect to any amendments or variations to matters
identified in the Notice of Meeting and with respect to the
transaction of such other business as may properly come
before the Meeting, as the proxyholder, in his sole
discretion, may see fit.
THE UNDERSIGNED HEREBY REVOKES ANY PROXY PREVIOUSLY GIVEN.
DATED this day of , 19 .
-------- ------------------------ ----
- ------------------------------------------
Signature
- ------------------------------------------
NAME (Please Print)
- ------------------------------------------
Number of Shares Represented
by This Proxy
Page 3
<PAGE>
NOTES
-----
1. THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED OR
WITHHELD FROM VOTING ON ANY POLL REQUESTED BY A SHAREHOLDER OR
PROXYHOLDER (PROVIDED THE INSTRUCTIONS ARE CERTAIN) OR REQUIRED
BY VIRTUE OF 5% OR MORE OF THE OUTSTANDING SHARES OF THE COMPANY
BEING REPRESENTED BY PROXIES AT THE MEETING THAT ARE TO BE VOTED
AGAINST A MATTER. IF THE SHAREHOLDER OR AN INTERMEDIARY HOLDING
SHARES AND ACTING ON BEHALF OF AN UNREGISTERED SHAREHOLDER HAS
SPECIFIED A CHOICE WITH RESPECT TO ANY OF THE ITEMS ABOVE BY
MARKING AN "X" IN THE SPACE PROVIDED FOR THAT PURPOSE THE SHARES
WILL BE VOTED ON ANY POLL IN ACCORDANCE WITH THAT CHOICE. IF NO
CHOICE IS SPECIFIED, THE PROXYHOLDER, IF ONE PROPOSED BY
MANAGEMENT, INTENDS TO VOTE THE SHARES REPRESENTED BY THE PROXY
AS IF THE SHAREHOLDER HAD SPECIFIED AN AFFIRMATIVE VOTE. IF ANY
AMENDMENTS OR VARIATIONS TO MATTERS IDENTIFIED IN THE NOTICE OF
MEETING ARE PROPOSED AT THE MEETING OR IF ANY OTHER MATTERS
PROPERLY COME BEFORE THE MEETING, DISCRETIONARY AUTHORITY IS
HEREBY CONFERRED WITH RESPECT THERETO.
2. A SHAREHOLDER OR AN INTERMEDIARY HOLDING SHARES AND
ACTING ON BEHALF OF AN UNREGISTERED SHAREHOLDER HAS THE RIGHT TO
APPOINT A PERSON (WHO NEED NOT BE A SHAREHOLDER) TO ATTEND AND
ACT ON HIS BEHALF AT THE MEETING OTHER THAN THE PERSONS NAMED IN
THE PROXY AS PROXYHOLDERS. TO EXERCISE THIS RIGHT, THE
SHAREHOLDER OR INTERMEDIARY MUST STRIKE OUT THE NAMES OF THE
PERSONS NAMED IN THE PROXY AS PROXYHOLDERS AND INSERT THE NAME OF
HIS NOMINEE IN THE SPACE PROVIDED OR COMPLETE ANOTHER PROXY.
3. This Proxy will not be valid unless it is dated and
signed by the shareholder, by his attorney authorized in writing
or by the intermediary. In the case of a corporation, this Proxy
must be executed under its corporate seal or signed by a duly
authorized officer or attorney for the corporation.
4. To be effective, the Proxy together with the power of
attorney or other authority, if any, under which it was signed or
a notarially certified copy thereof must be deposited with the
Company's transfer agent, Montreal Trust Company of Canada, of
510 Burrard Street, Vancouver, British Columbia, V6C 3B9 at least
48 hours (excluding Saturdays, Sundays and statutory holidays)
before the time of the Meeting or adjournment thereof or
deposited with the chairman of the meeting prior to the
commencement thereof. Unregistered shareholders who received the
Proxy through an intermediary must deliver the Proxy in
accordance with the instructions given by such intermediary.
5. This Proxy is solicited on behalf of the management of
the Company.
Your name and address are shown as registered - please notify
Montreal Trust Company of Canada of any change in your address.
