<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 / /
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
THE RICEX COMPANY
- --------------------------------------------------------------------------------
(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:
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total Fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary material.
/ / 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:
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(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing party:
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(4) Date filed:
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<PAGE>
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
ON JULY 1, 1999
------------------------
To the Stockholders of
The RiceX Company:
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of the Stockholders of
The RiceX Company, a Delaware corporation (the "Company"), will be held at The
Sheraton Hotel, 11211 Point East Drive, Rancho Cordova, California on Thursday,
July 1, 1999, at 8:30 A.M. (Pacific Time) for the following purposes:
1. To elect two directors to the Board of Directors who will serve until
the Company's 2002 Annual Meeting of Stockholders or until their
successors have been duly elected and qualified; and
2. To transact such other business as may be properly brought before the
meeting or any postponement or adjournment thereof.
It is anticipated that this Proxy Statement and the accompanying form of
proxy will first be sent to the stockholders of the Company on or about June 10,
1999. The Board of Directors knows of no matters, other than those set forth in
paragraphs 1 through 2 above (discussed in greater detail in the accompanying
Proxy Statement), that will be presented for consideration at the meeting.
Stockholders of record at the close of business on May 21, 1999 will be entitled
to notice of and to vote at said meeting or any adjournments thereof. A list of
such stockholders shall be open to the examination of any stockholder at the
meeting and for a period of ten days prior to the date of the meeting at the
Company's principal executive offices in El Dorado Hills, California.
The Board of Directors urges each stockholder to read carefully the enclosed
Proxy Statement, which is incorporated herein by reference.
By Order of the Board of Directors,
/s/ Todd C. Crow
Todd C. Crow
SECRETARY AND PRINCIPAL FINANCIAL
OFFICER
El Dorado Hills, CA
Dated: June 8, 1999
IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND THE 1999 ANNUAL MEETING IN PERSON, PLEASE
COMPLETE, DATE, SIGN, AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. YOUR PROXY
WILL BE REVOCABLE ANY TIME PRIOR TO ITS EXERCISE EITHER IN WRITING OR BY VOTING
YOUR SHARES PERSONALLY AT THE 1999 ANNUAL MEETING.
<PAGE>
THE RICEX COMPANY
1241 HAWK'S FLIGHT COURT
EL DORADO HILLS, CA 95672
------------------------
PROXY STATEMENT FOR
1999 ANNUAL MEETING OF STOCKHOLDERS
JULY 1, 1999
------------------------
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors and management of The RiceX Company, a Delaware corporation
("RiceX" or "Company"), of proxies from the holders of the Company's common
stock, par value $.001 per share (the "Common Stock"), for use at the 1999
Annual Meeting of Stockholders to be held at The Sheraton Hotel, 11211 Point
East Drive, Rancho Cordova, California on Thursday, July 1, 1999, at 8:30 A.M.
(Pacific Time) and at any adjournments or postponements thereof. A form of the
proxy is enclosed for use at the meeting. Stockholders are being asked to vote
upon the election of two directors to the Board of Directors and to transact
such other business as may properly come before the meeting.
INFORMATION CONCERNING PROXY
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. If no instructions are given on the proxy, all shares represented by
valid proxies received pursuant to this solicitation and not revoked before they
are voted will be voted FOR the directors nominated by the Board of Directors,
and as recommended by the Board of Directors with regard to all other matters
or, if no such recommendation is given, in the discretion of the proxy holder.
Proxies marked "withhold" will be counted towards the quorum requirement but
will not be voted for the election of the Board of Directors' director nominees.
A proxy may be revoked at any time before it is exercised by giving written
notice of revocation to the Secretary of the Company or by submitting, prior to
the time of the meeting, a properly executed proxy bearing a later date.
Stockholders having executed and returned a proxy, who attend the meeting and
desire to vote in person, are requested to so notify the Secretary of the
Company prior to the time of the meeting.
The cost of soliciting proxies, including expenses in connection with
preparing and mailing this Proxy Statement, will be borne by the Company. In
addition to solicitation by use of the mail, certain officers and regular
employees of the Company may solicit, for no additional compensation, the return
of proxies by telephone, telegram, or personal interview. The Company has
requested that brokerage houses and other custodians, nominees and fiduciaries
forward soliciting materials to their principals, the beneficial owners of
Common Stock of the Company, and will reimburse them for their reasonable
out-of-pocket expenses in so doing.
The mailing address of the Company is 1241 Hawk's Flight Court, El Dorado
Hills, CA 95762.
PURPOSES OF THE MEETING
At the 1999 Annual Meeting, the Company's stockholders will consider and
vote upon the following matters:
1. To elect two directors to the Board of Directors who will serve until the
Company's 2002 Annual Meeting of Stockholders or until their successors have
been duly elected and qualified; and
<PAGE>
2. To transact such other business as may be properly brought before the
meeting or any postponement or adjournment thereof.
Unless contrary instructions are indicated on the enclosed proxy, all shares
represented by valid proxies received pursuant to this solicitation (and which
have not been revoked in accordance with the procedures set forth above) will be
voted (1) FOR the election of the nominees for director named below, and (2) by
the proxies, in a manner recommended by the Board of Directors, or, if no such
recommendation, by the proxies in their discretion upon any other proposal as
may properly come before the Annual Meeting. In the event a stockholder
specifies a different choice by means of the enclosed proxy, such stockholder's
shares will be voted in accordance with the specification so made.
OUTSTANDING VOTING SECURITIES AND VOTING RIGHTS
The Company's Board of Directors has fixed the close of business on May 21,
1999 as the record date for the determination of stockholders entitled to vote
at the meeting (the "Record Date"). As of the Record Date, there were 22,052,997
shares of Common Stock issued and outstanding, all of which are entitled to be
voted at the Annual Meeting. Each share of Common Stock is entitled to one vote
on each matter submitted to stockholders for approval at the Annual Meeting.
Stockholders do not have the right to cumulate votes for directors.
The attendance, in person or by proxy, of the holders of a majority of the
outstanding shares of Common Stock entitled to vote at the Annual Meeting is
necessary to constitute a quorum. Directors will be elected by a plurality of
the votes cast by the shares of Common Stock represented in person or by proxy
at the Annual Meeting. Any other matter that may be submitted to a vote of the
stockholders will be approved if the number of shares of Common Stock voted in
favor of the matter exceeds the number of shares voted against the matter,
unless the matter is one for which a greater vote is required by law or by the
Company's Certificate of Incorporation or Bylaws. If less than a majority of
outstanding shares of Common Stock are represented at the Annual Meeting, a
majority of the shares so represented may adjourn the Annual Meeting to another
date, time or place, and notice need not be given of the new date, time or place
if the new date, time or place is announced at the meeting before an adjournment
is taken.
Prior to the Annual Meeting, the Company will select one or more inspectors
of election for the meeting. Such inspector(s) shall determine the number of
shares of Common Stock represented at the meeting, the existence of a quorum and
the validity and effect of proxies, and shall receive, count and tabulate
ballots and votes and determine the results thereof. Abstentions will be
considered as shares present and entitled to vote at the Annual Meeting and will
be counted as votes cast at the Annual Meeting, but will not be counted as votes
cast for or against any given matter. The inspectors of election will treat
shares referred to as "broker or nominee non-votes" (shares held by brokers or
nominees as to which instructions have not been received from the beneficial
owners or persons entitled to vote and the broker or nominee does not have
discretionary voting power on a particular matter) as shares that are present
and entitled to vote for purposes of determining the presence of a quorum. For
purposes of determining the outcome of any matter as to which the proxies
reflect broker or nominee non-votes, shares represented by such proxies will be
treated as not present and not entitled to vote on that subject matter and
therefore will not be considered by the inspectors of election when counting
votes cast on the matter (even though those shares are considered entitled to
vote for quorum purposes and may be entitled to vote on other matters).
Accordingly, abstentions and broker or nominee non-votes will not have the same
effect as a vote against the election of any director.
SECURITY OWNERSHIP
The following table sets forth certain information as of May 1, 1999 (the
"Reference Date") with respect to the beneficial ownership of Common Stock of
the Company, by each person known by the Company to own beneficially more than
five percent of the Company's Common Stock, by each executive
2
<PAGE>
officer and director, and by all executive officers and directors as a group.
Unless otherwise indicated, all persons have sole voting and investment powers
over such shares, subject to community property laws. As of the Reference Date,
there were 22,027,997 shares of Common Stock outstanding.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL PERCENT OF
NAME (1) OWNERSHIP(2) CLASS
- --------------------------------------------------------- ---------------------- -----------
<S> <C> <C>
FoodCeuticals, LLC....................................... 4,684,218(3) 15.50%
355 Madison Avenue,
Morristown, NJ 07960
Daniel L. McPeak, Sr., Chief Executive Officer and
Chairman of the Board, and Patricia McPeak, President
and Director........................................... 3,877,829(4) 12.81%
Heldomo, A.G............................................. 3,181,818(5) 10.51%
12, Baarer Strasse, 6300 Zug,
Switzerland
Kirit Kamdar, Director................................... 1,801,250(6) 5.95%
Steven W. Saunders, Director............................. 857,300(6) --
Ike E. Lynch, V.P. Operations............................ 200,000(6) --
Dr. Michael Goldblatt, Director.......................... 65,000(6) --
Sebastian N. Rosin, Director............................. 50,000(6) --
Todd C. Crow, Principal Financial Officer................ 110,000(6) --
Joseph R. Bellantoni, Director........................... 251,200(7)
All directors and executive officers, as a group (9
persons)............................................... 7,212,379 23.86%
</TABLE>
- ------------------------
(1) Except as otherwise noted, the address for each person is c/o The RiceX
Company, 1241 Hawk's Flight Court, El Dorado Hills, California 95762.
(2) Unless otherwise noted, the Company believes that all persons named in the
table have sole voting and investment power with respect to all shares of
common stock listed as beneficially owned by them. A person is deemed to be
the beneficial holder of securities that can be acquired by such person
within 60 days from the Reference Date upon the exercise of warrants or
options. Each beneficial owner's percentage ownership is determined by
including shares underlying options or warrants which are exercisable by
such person currently or within 60 days following the Reference Date, and
excluding shares underlying options and warrants held by any other person.
(3) Includes warrants to purchase 3,743,540 shares of common stock of the
Company.
(4) Ownership shown jointly because Mr. McPeak and Ms. McPeak are married.
Includes 1,808,225 shares in Mr. McPeak's name and 1,869,604 shares in Ms.
Peak's name and 200,000 held in a joint trust.
(5) Includes warrants to purchase 1,000,000 shares of Common Stock of the
Company.
(6) Includes options for the purchase of common stock as follows: Kirit S.
Kamdar, 50,000; Steven W. Saunders, 50,000; Dr. Michael Goldblatt, 65,000;
Todd C. Crow, 110,000; Sebastian N. Rosin, 50,000; Ike Lynch, 140,000.
(7) Includes shares held by Mr. Bellantoni's wife in the amount of 26,000 shares
of common stock to which Mr. Bellantoni disclaims beneficial ownership and a
warrant to purchase 200,000 shares of common stock of the Company that
FoodCeuticals, LLC has agreed to give Mr. Bellantoni in consideration of his
services performed in connection with the loan from FoodCeuticals to the
Company. The warrant when transferred will be currently exercisable.
3
<PAGE>
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
<TABLE>
<CAPTION>
NAME AGE POSITION
- --------------------------------------- ----- ----------------------------------------------
<S> <C> <C>
Daniel L. McPeak, Sr................... 64 Class III Director, CEO, and Chairman of the
Board
Patricia McPeak........................ 58 President and Class III Director
Dr. Michael J. Goldblatt(1)(2)......... 46 Class I Director
Kirit S. Kamdar(1)..................... 57 Class I Director
Joseph R. Bellantoni................... 37 Class II Director
Steven W. Saunders (2)................. 43 Class I Director
Todd C. Crow........................... 50 Vice President Finance and Principal Financial
Officer
Ike E. Lynch........................... 54 Vice President of Operations
Daniel L. McPeak, Jr................... 39 Vice President and General Manager
Dr. Rukmini Cheruvanky................. 65 Director of Research and Development
Dr. Reddy Sastry V. Cherukuri.......... 62 Director of Science and Technology
</TABLE>
- ------------------------
(1) Member of the Audit Committee
(2) Member of the Compensation Committee
DIRECTORS AND EXECUTIVE OFFICERS
DANIEL L. MCPEAK. Mr. McPeak co-founded the Company in February 1989 and
has served as Chairman of the Board of the Company since its formation. Mr.
McPeak has served as a Class III Director of the Company and will serve until
the election of Directors in 2001. In November 1998, Mr. McPeak was re-appointed
Chief Executive Officer ("CEO") of the Company. Mr. McPeak previously served as
CEO of the Company from May 1989 to April 1997. Mr. McPeak is the spouse of Ms.
McPeak
PATRICIA MCPEAK. Ms. McPeak co-founded the Company in February 1989 and has
served as President and Director of the Company since its formation. Ms. McPeak
has served as a Class III Director of the Company and will serve until the
election of Directors in 2001. From February 1989 to January 1996, Mrs. McPeak
also served as Secretary of the Company. Ms. McPeak is the spouse of Mr. McPeak.
DR. MICHAEL J. GOLDBLATT. Dr. Goldblatt has served as a Class I Director of
the Company since July 1997 and will serve until the next election of Directors
in 1999. Dr. Goldblatt currently serves as President and Chief Executive Officer
for Intelligent Biocides. Dr. Goldblatt served as Vice President of Science and
Technology for McDonalds Corporation from February 1996 to September 1998. Dr.
Goldblatt held various positions during his career at McDonalds Corporation,
beginning in 1987 as Director of Nutrition. Dr. Goldblatt is also a member of
the Board of Directors of Bernard Technologies, Biotechnologies Research
Development Corporation and Gray Star. Mr. Goldblatt received his Ph.D. in
Nutrition from the University of California, Davis.
KIRIT S. KAMDAR. Mr. Kamdar has served as a Class I Director of the Company
since August 1998 and will serve until the next election of Directors at this
Annual Meeting. Mr. Kamdar has tendered his resignation to be effective upon the
appointment of a director to fill the vacancy by (i) Monsanto upon conversion of
the Monsanto Note or (ii) appointment of a director by a majority of investors,
if required by the terms of any future offering of equity securities of the
Company. From January 1990 to September 1992, Mr. Kamdar also served as Director
of the Company, and from January 1990 to April 1994 as the Company's Executive
Vice President. Since July 1974, Mr. Kamdar has been Chairman of the Board and
4
<PAGE>
Chief Executive Officer of Kamflex Corporation, a manufacturing corporation. Mr.
Kamdar received his B.A. degree in Mechanical Engineering from the University of
Bombay and his Master's Degree in Industrial Engineering and Management from
Oklahoma State University.
JOSEPH R. BELLANTONI. Mr. Bellantoni has served as a Class II Director of
the Company since April 1999. Mr. Bellantoni has tendered his resignation to be
effective upon the Company's payment of the $1,850,000 promissory note to
FoodCeuticals, LLC. Mr. Bellantoni was nominated as a director by FoodCeuticals
in connection with a loan from FoodCeuticals to the Company in December 1998.
From December 1998 to the present, Mr. Bellantoni has served as the Managing
Director of FoodCeuticals. From April 1995 to the present, Mr. Bellantoni has
served as a Director of Dominion Resources, Inc., a real estate and resort
development company. From April 1995 to December 1998 he served as Treasurer and
Chief Financial Officer of Dominion and from January 1999 to the present has
served as its Treasurer and President. From February 1989 to January 1993, Mr.
Bellantoni served as a manager of Great American Recreation, Inc., an owner,
operator and developer of a ski resort and summer recreation facility. Great
American Recreation, Inc. filed for involuntary bankruptcy under the Bankruptcy
Code on April 2, 1996 and was renamed as GAR, Inc. From January 1993 to June
1994, Mr. Bellantoni served as the Vice President of Administration of Great
American, from June 1994 to October 1996 he served as its Chief Financial
Officer and from October 1995 to the present, Mr. Bellantoni has served as a
Director. From November 1994 to the present, Mr. Bellantoni has served as the
Chief Financial Officer of the Great Gorge Golf Reserve, an owner, operator and
developer of golf courses. Mr. Bellantoni is also currently a director of
Dominion Resources, Inc. and GAR, Inc. (formerly Great American Recreation,
Inc.). See "Certain Relationships and Related Transactions."
STEVEN W. SAUNDERS. Mr. Saunders has served as a Class I Director of the
Company since August 1998 and will serve until the next election of Directors at
this Annual Meeting. Mr. Saunders has tendered his resignation to be effective
upon the appointment of a director to fill the vacancy by (i) Monsanto upon
conversion of the Monsanto Note or (ii) appointment of a director by a majority
of investors, if required by the terms of any future offering of equity
securities of the Company. Mr. Saunders has been President of Saunders
Construction, Inc., a commercial construction firm since February 7, 1991 and
President of Warwick Corporation, a business-consulting firm.
TODD C. CROW. Mr. Crow joined the Company in May 1996 and has been the
Company's Vice President of Finance and Principal Financial Officer since
November 1998 and its Secretary since January 1999. From September 1997 to
November 1998, Mr. Crow was the Company's Controller. From May 1996 to September
1997 he was the Company's Chief Financial Officer. Mr. Crow also served as a
Director of the Company from June 1996 to January 1997. From 1989 until joining
The RiceX Company, Mr. Crow held senior financial positions with the Morning
Star Group, an agri-business holding company, and Harter, Inc., a
food-processing manufacturer.
IKE E. LYNCH. Mr. Lynch has served as Vice President of Operations of the
Company since July 1997 and as President and Chief Operations Officer of FoodEx
MT since January 1997. Previously Mr. Lynch was President and Chief Executive
Officer of Centennial Foods, Inc., since its founding in 1989 until its
acquisition by the Company in January 1997.
SIGNIFICANT EMPLOYEES
DANIEL L. MCPEAK, JR. Mr. McPeak joined the Company in July 1996 and has
been the Company's Vice President and General Manager since November 1998. From
July 1996 to July 1997, he served as Director of Sales and Marketing, then moved
to the position of Business Manager until November 1998. From 1994 until joining
the Company, Mr. McPeak served as Vice President of Marketing for Fort Knox,
Inc., a security products manufacturer. Daniel L. McPeak, Jr. is the son of
Daniel L. McPeak, Sr.
5
<PAGE>
DR. RUKMINI CHERUVANKY. Dr. Cheruvanky has served as the Company's Director
of Research and Development since April 1996. From January 1996 until joining
the Company, Dr. Cheruvanky was the Laboratory Supervisor for Certified
Analytical Laboratories, a company that specializes in food analysis. From
November 1994 to December 1995, Dr. Cheruvanky was Research Chemist in the
Research and Development Department of DuPont Merck Pharmaceutical Company. From
May 1967 to February 1994, Dr. Cheruvanky was Deputy Director of the National
Institute of Nutrition, the Indian Council of Medical Research. Dr. Cheruvanky
has an M.S. degree in Organic Chemistry and a Ph.D. degree in Organic Chemistry
of Natural Products from Andhra University in India.
DR. REDDY SASTRY V. CHERUKURI. Dr. Cherukuri has served as the Company's
Director of Science and Technology since April 1996. From May 1995 until joining
the Company, Dr. Cherukuri served as Laboratory Supervisor of Customs Coatings,
Inc., a research pharmaceutical company. From December 1994 to January 1995, Dr.
Cherukuri was Chemist for DuPont Merck Pharmaceutical Company. From May 1992 to
November 1994, Dr. Cherukuri was Consultant to the Indian Council of Medical
Research. From January 1967 to May 1992, Dr. Cherukuri served as Senior Research
Manager, Chief of Medicinal Chemistry and Group Leader of New Drug Development
for Indian Drugs and Pharmaceutical, Ltd., a synthetic drugs research and
development company. Dr. Cherukuri has a M.S. degree in Organic Chemistry and a
Ph.D. degree in Organic Chemistry of Synthetic and Natural Products from Andhra
University in India.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Kirit Kamdar has been a Director of the Company since August 5, 1998 and
was a Director of the Company from January 1990 to September 1992. From January
1990 to April 1994, Mr. Kamdar served as the Company's Executive Vice President.
Mr. Kamdar currently owns 1,801,250 shares of the Company's common stock or
5.95%. Since July 1974, Mr. Kamdar has been Chairman of the Board and Chief
Executive Officer of Kamflex Corporation ("Kamflex"), a manufacturer of
extrusion and conveyor equipment. In 1997, Kamflex sold $83,990 worth of such
equipment to the Company pursuant to its standard commercial terms and prices.
Kamflex's sales volume to customers other than the Company is approximately $3.5
to $4 million per year. The Company did not purchase any equipment from Kamflex
in 1998.
In May 1997, the Company's Chief Executive Officer and a director (the
"CEO") exercised an option to purchase 2,000,000 shares of the Company's common
stock at an exercise price of $2.00 per share in exchange for promissory notes
in the aggregate principal amount of $4,000,000 that bore interest at a rate of
8% per annum, were secured by the 2,000,000 shares of common stock purchased and
were due at the earlier of May 2002 or upon the sale of all or a portion of the
shares of common stock acquired upon exercise. The Company agreed to reimburse
the CEO the interest payable on the notes plus the related income tax effect of
such reimbursement. The CEO agreed to rescind the exercise of his option
concurrent with the successful closing of the a private placement in September
1998.
In September 1998, the CEO, as agreed, rescinded the exercise of his option
in exchange for the cancellation of his indebtedness to the Company related to
the exercise and the reinstitution of the options to purchase 2,000,000 shares
of the Company's common stock at an exercise price of $1.81 per share, the fair
market value of the shares on the date of grant. The accrued interest income
related to the notes receivable and the associated accrued liability for the
associated reimbursements were written off to operations in the year ended
December 31, 1998 in connection with the rescission.
In addition, in September 1998, the Company's Board of Directors cancelled
the outstanding options to purchase an aggregate of 2,950,000 shares of common
stock with exercise prices ranging from $2.00 to $4.88 per share held by the
CEO, four of the Company's executive officers and two directors, and replaced
them with options to purchase an aggregate of 2,950,000 shares of common stock
at an exercise price of $1.81 per share, the fair market value of the Company's
common stock on the date of grant.
6
<PAGE>
In December 1998, the employment agreements of four officers were
terminated. As part of the severance agreements with three officers, all
previously issued options to purchase the Company's common stock held by such
officers were canceled and the remaining officer's options expired. The unvested
portion of the accrued compensation relating to the options at the date of
termination of $1,376,204 was forfeited by the officers. In conjunction with
their terminations, three of the officers were paid an aggregate of $260,417 and
were issued warrants, which expire in December 2000, to purchase an aggregate of
1,200,000 shares of the Company's common stock at an exercise price of $1.00 per
share as part of their severance agreements.
Mr. Joseph R. Bellantoni has been a director of the Company since April
1999. Mr. Bellantoni currently serves as the Treasurer, President and a Director
of Dominion Resources, Inc., a company to which the Company has outstanding a
promissory note in the amount of $1,750,000. From April 1995 to December 1998 he
served as the Chief Financial Officer of Dominion. In addition, FoodCeuticals, a
company to which the Company has outstanding a promissory note in the amount of
$1,850,000, has agreed to give Mr. Bellantoni 200,000 warrants to purchase
common stock of the Company as consideration for Mr. Bellantoni's services
provided to FoodCeuticals in connection with the promissory note. Mr. Bellantoni
also has served as FoodCeuticals Managing Director since December 1998. Pursuant
to the terms of the promissory note with FoodCeuticals, Mr. Bellantoni was
nominated by FoodCeuticals to serve as a director on the Company's board.
The Company believes that the transactions set forth above were made on
terms no less favorable to the Company than could have been obtained from
unaffiliated third parties. The Company intends that all future transactions,
including loans, between the Company and its officers, directors, principal
stockholders and their affiliates be approved by a majority of the Board of
Directors, including a majority of the independent and disinterested outside
directors on the Board of Directors, and be on terms no less favorable to the
Company than could be obtained from unaffiliated third parties.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based upon a review of the Company's records, the Company is aware that the
following officers or directors of the Company failed to timely file one or more
reports disclosing beneficial ownership of securities of the Company as required
under Section 16(a) of the Securities Exchange Act of 1934, as amended, during
the fiscal year ended December 31, 1998: each of Karen D. Berriman, Dr. Michael
J. Goldblatt, Ike E. Lynch, Daniel McPeak, Sr., Patricia McPeak, Gary A. Miller,
Dennis Riddle, Allen J. Simon and Dr. Jerry Weisbach failed to timely file Forms
3 reporting their initial statement of beneficial ownership of securities upon
the Company registering its Common Stock with the Securities and Exchange
Commission under the Securities Exchange Act of 1934 in July 1998; Todd C. Crow
failed to timely file Forms 3 reporting his initial statement of beneficial
ownership of securities upon Mr. Crow becoming Vice President of Finance and the
Company's Principle Financial Officer in November 1998; Karen D. Berriman failed
to timely file Forms 4 reporting the following transactions which were
subsequently reported on a timely filed Form 5 (i) a cancellation of options to
purchase 200,000 shares of Common Stock on December 26, 1998, and (ii) the
issuance of warrants to purchase 100,000 shares of Common Stock on December 26,
1998; Karen D. Berriman failed to timely file Forms 4 for the following
transactions which were subsequently reported on a late Form 4 filing (i) the
cancellation of stock options on September 10, 1998, and (ii) the grant of
replacement options on September 10, 1998; Gary A. Miller failed to timely file
Forms 4 reporting the following transactions which were subsequently reported on
a timely filed Form 5 (i) a cancellation of options to purchase 200,000 shares
of Common Stock on December 26, 1998, and (ii) the issuance of warrants to
purchase 100,000 shares of Common Stock on December 26, 1998; Allen J. Simon
failed to timely file Forms 4 reporting the following transactions which were
subsequently reported on a timely filed Form 5 (i) a cancellation of options to
purchase 2,000,000 shares of Common Stock on December 26, 1998, and (ii) the
issuance of warrants to purchase 1,000,000 shares of Common Stock on December
26, 1998.
7
<PAGE>
BOARD OF DIRECTORS
The Board of Directors is classified into three classes, designated Class I,
Class II and Class III. The term of office of the initial Class I Directors
expires at this Annual Meeting of stockholders; the term of office of the
initial Class II Directors expires at the Company's 2000 Annual Meeting of
stockholders; and the term of the initial Class III Directors expires at the
Company's 2001 Annual Meeting of stockholders. The classification of the Board
of Directors has the effect of generally requiring at least two annual
stockholder meetings, instead of one, to replace a majority of the members of
the Board of Directors.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the Company's fiscal year ended December 31, 1998, the Company's
Board of Directors held six meetings and took certain actions by written
consent. During the 1998 fiscal year, no director attended fewer than 75 percent
of the aggregate of (i) the number of meetings of the Board of Directors held
during the period he served on the Board, and (ii) the number of meetings of
committees of the Board of Directors held during the period he or she served on
such committees.
The Board of Directors has established an Audit Committee and Compensation
Committee.
The Audit Committee, consisting of Dr. Goldblatt and Kirit Kamdar, reviews
the adequacy of internal controls and results and scope of the audit and other
services provided by the Company's independent auditors. The Audit Committee
meets periodically with management and the independent auditors. The Audit
Committee held no meetings during the fiscal year ended December 31, 1998.
The Compensation Committee, consisting of Dr. Goldblatt and Steven Saunders,
establishes salaries, incentives and other forms of compensation for officers
and other employees of the Company, and administers the incentive compensation
and benefit plans of the Company. The Compensation Committee held no meetings
during the fiscal year ended December 31, 1998.
EXECUTIVE COMPENSATION
The following table sets forth the total compensation for the Chief
Executive Officers and each of the Company's current executive officers and two
former officers whose total salary and bonuses for fiscal 1997 and 1998 exceeded
$100,000 or would have exceeded $100,000 on an annualized basis (collectively,
the "Named Executive Officers").
8
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
------------------------------------
AWARDS
ANNUAL COMPENSATION -----------------
------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY COMPENSATION OPTIONS/SARS (#) COMPENSATION
- ---------------------------------------- ---- -------- -------------- ----------------- ---------------
<S> <C> <C> <C> <C> <C>
Daniel L. McPeak, Sr.................... 1998 $150,000 (2) -- --
Chairman of the Board(1) 1997 141,798 $26,409(5) 50,000 --
1996 116,308 (2) 50,000 --
Patricia McPeak......................... 1998 130,000 18,282(6) -- --
President 1997 127,135 13,372(6) 50,000 --
1996 113,308 (2) 50,000 --
Allen J. Simon(1)....................... 1998 221,534 38,471(7) -- $236,522(11)
1997 177,370 28,760(7) 2,050,000(10) --
Ike E. Lynch............................ 1998 137,500 25,200(8) 140,000 --
V.P. Operations 1997 131,253 47,700(8) 60,000 --
Karen Berriman(3)....................... 1998 132,693 (2) -- $ 31,837(11)
1997 43,189 (2) 200,000(10) --
Dennis C. Riddle(4)..................... 1998 154,746 $52,185(9) -- --
1997 $ 30,147 (2) 350,000(12) --
</TABLE>
- ------------------------
(1) Mr. McPeak was Chief Executive Officer from January 1996 to April 1997 and
from November 18, 1998 to present. Mr. Simon provided services as CEO from
April 1997 to November 18, 1998 and resigned from the office of CEO
effective December 13, 1998 in accordance with his severance agreement. See
"Certain Relationships and Related Transactions."
(2) Other Annual Compensation is less than 10% of Salary.
(3) Ms. Berriman served as Chief Financial Officer from September 1997 to
December 1998.
(4) Mr. Riddle served as Vice President of Sales and Marketing from October
1997 to December 1998.
(5) Represents automobile expenses of $21,787 and other perquisites.
(6) Represents automobile allowance of $12,000 in 1998 and automobile expenses
of $9,019 in 1997 and other perquisites paid on behalf of the executives.
(7) Represents automobile allowance of $12,600, temporary housing allowance of
$24,381 and other prerequisites in 1998; automobile allowance of $10,200,
temporary living allowance of $18,052 and other perquisites in 1997.
(8) Represents allowances for temporary living of $18,000 and automobile of
$7,200 in 1998; and value realized upon the exercise of stock options of
$30,000, automobile allowance of $7,200 and temporary housing allowance of
$10,500 in 1997.
(9) Represents allowances for relocation of $30,000, temporary housing of
$8,862, automobile of $12,500 and other perquisites.
(10) Represents options granted in 1997 that were replaced and re-priced in
September 1998, eventually cancelled in December 1998 and warrants issued
in accordance with severance agreements. See "--Re-priced Options,"
"Certain Relationships and Related Transactions."
9
<PAGE>
(11) Represents severance payments and accrued vacation pay: A. Simon $210,417
severance, $26,105 accrued vacation; K. Berriman $25,000 severance, $6,837
accrued vacation pay.
(12) Represents options granted in 1997 that were replaced and re-priced in
September 1998 and eventually expired subsequent to termination in
December 1998. See "--Re-priced Options," "Certain Relationships and
Related Transactions."
OPTION GRANTS IN 1998 TO EXECUTIVES
The following table sets forth for each of the Named Executive Officers
certain information concerning stock options granted during 1998.
<TABLE>
<CAPTION>
NUMBER OF PERCENT OF
SECURITIES TOTAL OPTIONS/
UNDERLYING SARS GRANTED
OPTIONS/SARS TO EMPLOYEES EXERCISE PRICE EXPIRATION
NAME GRANTED (#) IN FISCAL YEAR ($/SH) DATE
- -------------------------------------------------- ----------------- -------------- --------------- ----------
<S> <C> <C> <C> <C>
Ike E. Lynch...................................... 40,000(1) 0.7% 1.8125 9/10/08
Ike E. Lynch...................................... 200,000(2) 3.8%(2) 1.8125 9/10/08
Allen J. Simon.................................... 4,000,000(3)(4) 76.0%(3)(4) 1.8125(3)(4) --
Karen D. Berriman................................. 200,000(4) 3.8%(4) 1.8125(4) --
Dennis C. Riddle.................................. 350,000(5) 6.6%(5) 1.8125(5) --
</TABLE>
- ------------------------
(1) Options were granted on September 10, 1998 and were fully vested and
immediately exercisable at $1.81 per share.
(2) Options to purchase 100,000 shares were granted on January 1, 1998, provided
for vesting over 3 years, and were exercisable at $3.75 per share. In
September 1998, the option was cancelled and replaced with a new option to
purchase an equal number of shares of common stock at $1.81 per share. Only
100,000 options are outstanding at year end.
(3) Pursuant to a rescission of exercise, Mr. Simon's 2,000,000 options were
reinstituted at the original exercise price of $2.00 per share. These
options were then cancelled in September 1998. See "--Re-priced Options".
(4) Original options were granted in 1997, and the reinstituted options in the
case of Mr. Simon were cancelled September 1998. Cancelled options granted
in 1997 were replaced and re-priced in September 1998, then the replacement
options were subsequently cancelled and warrants were issued in accordance
with severance agreements. See "--Re-priced Options" and "Certain
Relationships and Related Transactions".
(5) Original options granted in 1997 were cancelled September 1998. Original
options were replaced and re-priced in September 1998, then expired
subsequent to termination in December 1998. See "--Repriced Options" and
"Certain Relationships and Related Transactions."
10
<PAGE>
STOCK OPTION EXERCISES AND YEAR-END VALUE TABLE
The table below reflects the number of shares covered by both exercisable
and non-exercisable stock options as of December 31, 1998 for the Named
Executive Officers. Values for "in-the-money" options represent the position
spread between the exercise price of existing options and the market value for
the Company's common stock on December 31, 1998.
<TABLE>
<CAPTION>
SHARES
ACQUIRED NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
ON OPTIONS IN-THE-MONEY OPTIONS
EXERCISE VALUE -------------------------- ---------------------------
NAME (#) REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------------------------- --------- ---------- ----------- ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Daniel L. McPeak, Sr........................ 100,000 $ 225,000
Allen J. Simon.............................. 50,000 93,750
Patricia McPeak............................. 100,000 162,500
Ike Lynch................................... 30,000 $ 30,000 40,000 100,000 (1) (1)
</TABLE>
- ------------------------
(1) The fair market value of the common stock subject to options as of December
31, 1998 was less than the exercise price of such options.
REPRICED OPTIONS
In September 1998, in conjunction with the private placement of 1,000,000
shares of the Company's common stock, the Company's Chief Executive Officer
("CEO"), at the request of the new investor, rescinded his 1997 exercise of a
1997 option to acquire 2,000,000 shares of the Company's common stock in
exchange for a $4,000,000 note payable to the Company. Coincidental with the
private placement and related rescission, the Company's Board of Directors
cancelled the options granted in 1997 to the CEO, four executive officers and
two directors to acquire an aggregate of 2,950,000 shares of the Company's
common stock at exercise prices ranging from $2.00 to $4.88 per share and
re-granted new options to purchase the same number of shares to these
individuals at an exercise price of $1.81 per share, the fair market value of
the shares at the date the new options were granted.
DIRECTOR COMPENSATION
On July 9, 1997, the Board of Directors adopted a non-employee director
compensation plan pursuant to which non-employee directors are compensated as
follows: (i) $15,000 annual retainer payable in quarterly installments for
participation at up to six meetings of the Board of Directors; (ii) an
immediately exercisable, nonqualified stock option to purchase 50,000 shares of
common stock to be granted upon appointment to the Board of Directors, and (iii)
an immediately exercisable, nonqualified stock option to purchase 15,000 shares
of common stock to be granted on the day of each annual shareholders' meeting
during the non-employee director's service on the Board of Directors. Such
options are to be granted as free-standing options and not under the 1997 Stock
Option Plan. The exercise price shall be the fair market value of a share of
common stock on the date of grant. On April 27, 1999 the Board voted to
temporarily suspend the grant of options with payment of retainers to the Board
of Directors. Directors are also reimbursed for reasonable expenses incurred in
attending meetings of the Board of Directors and committees thereof.
EMPLOYMENT AGREEMENTS
McPEAK EMPLOYMENT AGREEMENT. The Company entered into an Employment
Agreement with Mr. McPeak in April 1997 (the "McPeak Employment Agreement"),
pursuant to which Mr. McPeak agreed to serve as Chairman of the Board of
Directors of the Company and previously served as Chief Executive Officer. The
McPeak Employment Agreement provides that Mr. McPeak will receive an annual base
salary of $150,000 which will be increased to $200,000 upon the Company's
realization of positive cash
11
<PAGE>
flow on a month-to-month basis. The McPeak Employment Agreement terminates on
December 31, 2001, unless his employment is terminated earlier. Thereafter, the
term will be automatically extended for additional one-year periods unless
either party delivers notice of election not to extend the employment at least
60 days prior to the end of the then current term. Mr. McPeak's employment may
be terminated prior to the expiration of this agreement under the following
circumstances: (i) death; (ii) termination by the Company for Cause (as defined
in the McPeak Employment Agreement); or (iii) termination by the Company without
Cause (as defined in the McPeak Employment Agreement). If Mr. McPeak is
terminated without Cause, he is entitled to the base salary in effect at such
time for the remainder of the term of the McPeak Employment Agreement. Within
three months of first receiving notice of a Change in Control (as defined in the
McPeak Employment Agreement), Mr. McPeak may elect to retire from service and
render, on a non-exclusive basis, only such consulting and advisory services to
the Company as he may reasonably accept, and he is entitled to continue
receiving his benefits and salary until the later of (i) six months after the
date of such election, (ii) subsequent full-time employment with another
enterprise, or (iii) the expiration of the term of the McPeak Employment
Agreement.
MS. McPEAK EMPLOYMENT AGREEMENT. The Company entered into an Employment
Agreement with Ms. McPeak in April 1997 (the "Ms. McPeak Employment Agreement"),
pursuant to which Ms. McPeak agreed to serve as President of the Company. The
Ms. McPeak Employment Agreement provides that Ms. McPeak will receive an annual
base salary of $130,000 which will be increased to $150,000 upon the Company's
realization of positive cash flow on a month-to-month basis. The Ms. McPeak
Employment Agreement terminates on December 31, 2001, unless her employment is
terminated earlier. Thereafter, the term will be automatically extended for
additional one-year periods unless either party delivers notice of election not
to extend the employment at least 60 days prior to the end of the then current
term. Ms. McPeak's employment may be terminated prior to the expiration of the
agreement under the following circumstances: (i) death; (ii) termination by the
Company for Cause (as defined in the Ms. McPeak Employment Agreement); or (iii)
termination by the Company without Cause (as defined in the Ms. McPeak
Employment Agreement). If Ms. McPeak is terminated without Cause, she is
entitled to the base salary in effect at such time for the remainder of the term
of the Ms. McPeak Employment Agreement. Within three months of first receiving
notice of a Change in Control (as defined in the Ms. McPeak Employment
Agreement), Ms. McPeak may elect to retire from service and render, on a
non-exclusive basis, only such consulting and advisory services to the Company
as she may reasonably accept, and she is entitled to continue receiving her
benefits and salary until the later of (i) six months after the date of such
election, (ii) subsequent full-time employment with another enterprise, or (iii)
the expiration of the term of the Ms. McPeak Employment Agreement.
LYNCH EMPLOYMENT AGREEMENT. In January 1997, the Company's wholly-owned
subsidiary, Food Extrusion Montana, Inc., entered into an Employment Agreement
with Mr. Lynch (the "Lynch Employment Agreement"), pursuant to which Mr. Lynch
agreed to serve as President and Chief Operations Officer. The Lynch Employment
Agreement provides that Mr. Lynch will receive an annual base salary of $125,000
per year. The Lynch Employment Agreement terminates on December 31, 2002, unless
his employment is terminated earlier. Thereafter, the term will be automatically
extended for an additional two year term unless either party delivers notice of
election not to extend the employment at least 30 days prior to the expiration
of the initial term. Mr. Lynch's employment may be terminated prior to the
expiration of the agreement under the following circumstances: (i) the mutual
written agreement of FoodEx MT and Mr. Lynch; (ii) Mr. Lynch's disability, which
shall, for the purposes of the Lynch Employment Agreement, mean Mr. Lynch's
inability due to physical or mental impairment, to perform Mr. Lynch's duties
and obligations under the Lynch Employment Agreement, despite reasonable
accommodation by FoodEx MT, for a period exceeding three months; (iii) Mr.
Lynch's death; (iv) notice of termination by FoodEx MT for cause (as defined in
the Lynch Employment Agreement); or (v) written notice of termination by FoodEx
MT without cause upon fourteen (14) days notice, subject to the compensation for
early termination. If Mr. Lynch is terminated without cause, he is entitled to
the base salary in effect at such time for the remainder of the term of the
Lynch Employment Agreement.
12
<PAGE>
1997 STOCK OPTION PLAN
The Board of Directors adopted the 1997 Stock Option Plan (the "1997 Plan")
in November 1997 and the shareholders approved the 1997 Plan in May 1998. A
total of 5,000,000 shares have been authorized for issuance under the 1997 Plan,
of which 4,860,000 shares are available for future grant as of December 31,
1998. The 1997 Plan provides for the grant of "incentive stock options" as
defined in Section 422A of the Internal Revenue Code of 1986, as amended (the
"Code"), to employees of the Company. The 1997 Plan also provides for the grant
of options that are not intended to qualify as incentive stock options under
Section 422A of the Code to employees, non-employee directors and consultants of
the Company. The exercise price of any incentive stock option granted under the
1997 Plan may not be less than 100% of the fair market value of the Company's
common stock on the date of grant and the exercise price of any nonqualified
stock option may not be less than 85% of such fair market value, provided that,
in the case of a participant owning stock possessing more than 10% of the voting
rights of the Company's outstanding capital stock, the exercise price of any
incentive stock option may not be less than 110% of such fair market value.
Shares subject to an option granted under the 1997 Plan may be purchased for
cash, in exchange for shares of common stock owned by the optionee, or other
consideration as set forth in the 1997 Plan. The 1997 Plan is administered by
the Board of Directors. Under the 1997 Plan, options vest not less than 20% per
year and have ten year terms (except with respect to 10% stockholders which have
five-year terms). If the Company sells substantially all of its assets, is a
party to a merger or consolidation in which it is not the surviving corporation
(a "Change of Control"), then the Company has the right to accelerate unvested
options and shall give the option holder written notice of the exercisability
and specify a time period in which the option may be exercised. All options
shall terminate in their entirety to the extent not exercised on or prior to the
date specified in the written notice unless the agreement governing the Change
of Control shall provide otherwise.
INDEPENDENT PUBLIC ACCOUNTANTS
The Company's independent public accountants for the last completed fiscal
year end, December 31, 1998, were PricewaterhouseCoopers LLP. The Company
anticipates that representatives of PricewaterhouseCoopers will be present at
the Annual Meeting and will have an opportunity to make a statement if they
desire to do so and such representatives will be expected to be available to
respond to appropriate questions.
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
The Company's Certificate of Incorporation provides that the Board of
Directors shall consist of not less than five nor more than eight members, with
the exact number to be fixed from time to time by the Board of Directors. The
Board of Directors has currently fixed the number of directors at eight. The
Certificate of Incorporation divides the Board of Directors into three classes,
with staggered three-year terms. The current classes of the Board of Directors
and their terms of office are as follows:
<TABLE>
<CAPTION>
CLASS DIRECTORS TERM EXPIRES IN:
----- ------------------------------------- -----------------
<S> <C> <C>
I Dr. Michael J. Goldblatt 1999
I Kirit S. Kamdar 1999
I Steven W. Saunders 1999
II Joseph Bellantoni 2000
III Daniel L. McPeak, Sr. 2001
III Patricia McPeak 2001
</TABLE>
The three directors serving in Class I have terms expiring at the Annual
Meeting. Sebastian Rosin resigned as a Class I director on June 1, 1999. Two of
the three Class I directors currently serving on the Board, Messrs. Kamdar and
Saunders, have been nominated by the Board of Directors for re-election to
13
<PAGE>
three-year terms at the Annual Meeting. Each Class I director elected at the
Annual Meeting will serve for a term expiring at the Company's 2002 Annual
Meeting of Stockholders or when his successor has been duly elected and
qualified. The Board of Directors has no reason to believe that any nominee will
refuse or be unable to accept election; however, in the event that any nominee
is unable to accept election or if any other unforeseen contingencies should
arise, each proxy that does not direct otherwise will be voted for the remaining
nominees, if any, and for such other person(s) as may be designated by the Board
of Directors.
BOARD OF DIRECTORS
Below is the information with respect to nominees for election.
KIRIT S. KAMDAR. Mr. Kamdar has served as a Class I Director of the Company
since August 1998 and will serve until the next election of Directors in 1999.
Mr. Kamdar has tendered his resignation to be effective upon the appointment of
a director to fill the vacancy by (i) Monsanto upon conversion of the Monsanto
Note or (ii) appointment of a director by a majority of investors, if required
by the terms of any future offering of equity securities of the Company. From
January 1990 to September 1992, Mr. Kamdar also served as Director of the
Company, and from January 1990 to April 1994 as the Company's Executive Vice
President. Since July 1974, Mr. Kamdar has been Chairman of the Board and Chief
Executive Officer of Kamflex Corporation, a manufacturing corporation. Mr.
Kamdar received his B.A. degree in Mechanical Engineering from the University of
Bombay and his Master's Degree in Industrial Engineering and Management from
Oklahoma State University.
STEVEN W. SAUNDERS. Mr. Saunders has served as a Class I Director of the
Company since August 1998 and will serve until the next election of Directors in
1999. Mr. Saunders has tendered his resignation to be effective upon the
appointment of a director to fill the vacancy by (i) Monsanto upon conversion of
the Monsanto Note or (ii) appointment of a director by a majority of investors,
if required by the terms of any future offering of equity securities of the
Company. Since February 7, 1991, Mr. Saunders has been President of Saunders
Construction, Inc., a commercial construction firm, and President of Warwick
Corporation, a business-consulting firm.
OTHER BUSINESS
The Board knows of no other business to be brought before the Annual
Meeting. If, however, any other business should properly come before the Annual
Meeting, the persons named in the accompanying proxy will vote proxies as in
their discretion they may deem appropriate, unless they are directed by a proxy
to do otherwise.
INFORMATION CONCERNING STOCKHOLDER PROPOSALS
Pursuant to Rule 14a-8 promulgated by the Securities and Exchange
Commission, a stockholder intending to present a proposal to be included in the
Company's Proxy Statement for the Company's 2000 Annual Meeting of Shareholders
must deliver a proposal in writing to Corporate Secretary, The RiceX Company,
1241 Hawk's Flight Court, El Dorado Hills, CA 95762, no later than March 15,
2000. Proposals not in full conformity with the applicable rules of the
Securities and Exchange Commission may be excluded from the Proxy Statement.
By Order of the Board of Directors,
/s/ Daniel L. McPeak
Daniel L. McPeak
CHAIRMAN OF THE BOARD
El Dorado Hills, California
June 8, 1999
14
<PAGE>
THE RICEX COMPANY
1241 HAWK'S FLIGHT COURT
EL DORADO HILLS, CALIFORNIA 95762
THIS PROXY IS SOLICITED ON BEHALF OF
THE COMPANY'S BOARD OF DIRECTORS
The undersigned holder of Common Stock of The RiceX Company, a Delaware
corporation (the "Company"), hereby appoints Daniel L. McPeak and Patricia
McPeak, and each of them, as proxies for the undersigned, each with full power
of substitution, for and in the name of the undersigned to act for the
undersigned and to vote, as designated on the reverse side of this proxy card,
all of the shares of stock of the Company that the undersigned is entitled to
vote at the 1999 Annual Meeting of Stockholders of the Company, to be held at
The Sheraton Hotel, 11211 Point East Drive, Rancho Cordova, California on
Thursday, July 1, 1999, at 8:30 A.M. (Pacific Time) and at any adjournments or
postponements thereof.
(change of address/comments)
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
(If you have written in the above spaces please
mark the corresponding box on the reverse side
of this card.)
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
- PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED -
- --------------------------------------------------------------------------------
A /X/ PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
FOR all nominees WITHHOLD
listed at right AUTHORITY
(except as marked to for all nominees
the contrary below) listed at right
1. Election of / / / /
Directors:
Nominees:
Kirit Kamdar
Steven Saunders
For, except authority withheld as to the following nominee(s):
- ----------------------------------------------------------
The Board of Directors recommends a vote FOR the nominees for directors in
Proposal No. 1.
2. In their discretion on any other matter that may properly come before the
meeting or any adjournment thereof.
Please check this box if you plan to attend the Annual Meeting / /
DETACH & RETURN PROXY CARD; RETAIN ADMISSION CARD
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF STOCKHOLDERS
THE RICEX COMPANY
JULY 1, 1999
Signature(s) ______________________ ______________________ Date __________, 1999
NOTE: PLEASE SIGN EXACTLY AS NAME APPEARS ABOVE. JOINT OWNERS SHOULD EACH
SIGN. FIDUCIARIES SHOULD ADD THEIR FULL TITLE TO THEIR SIGNATURE.
CORPORATIONS SHOULD SIGN IN FULL CORPORATE NAME BY AN AUTHORIZED
OFFICER. PARTNERSHIPS SHOULD SIGN IN PARTNERSHIP NAME BY AN AUTHORIZED
PERSON.
<PAGE>
ADMISSION CARD
ANNUAL MEETING OF STOCKHOLDERS
JULY 1, 1999
8:30 A.M. (Pacific Time)
The Sheraton Hotel
11211 Point East Drive
Rancho Cordova, California
Presentation of this card is required
for admission to the Annual Meeting
PLEASE PRESENT THIS CARD TO THE COMPANY'S REPRESENTATIVE
AT THE ENTRANCE TO THE ANNUAL MEETING
THE RICEX COMPANY
Name: ________________________________________________
Address: _____________________________________________
