October 27, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Re: Earth Sciences, Inc.; Definitive Proxy Materials
Gentlemen and Ladies:
On behalf of Earth Sciences, Inc. (the Company), we file with you herewith
pursuant to Rule 14a-6(a) under the Securities Exchange Act of 1934, as amended,
the definitivey proxy material which the Company mailed on or about September
21, 1998, to its shareholders in connection with the solicitation of proxies
for an October 21, 1998 annual meeting of shareholders.
In connection with the foregoing, we deliver to you the following:
1. A copy of the Notice of an Annual Meeting of Shareholders and Proxy
Statement (the Notice), including the cover page required by Rule 14a-6(m); and
2. A definitive form of Proxy.
The Company has taken appropriate action to comply with the broker, bank
and nominee notification requirements set forth by Rule 14a-13 regarding the
forwarding of definitive proxy and other soliciting materials.
Very truly yours,
Earth Sciences, Inc.
Mark H. McKinnies
President
1
<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities 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
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
EARTH SCIENCES, INC.
...............................................................................
(Name of Registrant as Specified In Its Charter)
N/A
...............................................................................
(Name of Persons(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
[X ]No Fee Required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
..........................................................................
2) Aggregate number of securities to which transaction applies:
..........................................................................
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
..........................................................................
4) Proposed maximum aggregate value of transaction:
..........................................................................
5) Total fee paid:
..........................................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, of
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
..........................................................................
2) Form, Schedule or Registration Statement No.:
..........................................................................
3) Filing Party:
..........................................................................
4) Date Filed:
..........................................................................
2
<PAGE>
EARTH SCIENCES, INC.
910 12th Street
Golden, Colorado 80401
(303) 279-7641
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 21, 1998
To Our Shareholders:
An Annual Meeting (the "Meeting") of Shareholders of Earth Sciences, Inc. (the
"Company"), a Colorado corporation, will be held at 9:00 a.m. (local time) on
October 21, 1998 at the Golden Community Center, 1470 10th Street, Golden,
Colorado, for the following purposes:
1. To elect six (6) directors of the Company;
2. To approve an amendment to the Company's Articles of Incorporation to
increase the number of authorized shares from 25,000,000 shares to
50,000,000 shares;
3. To consider and vote upon such other matters as may properly come
before the Meeting or any adjournment thereof.
Shareholders of record at the close of business on September 15, 1998 are
entitled to notice of and to vote at the Meeting.
The Board of Directors of the Company extends a cordial invitation to all
shareholders to attend the Meeting in person. Whether or not you plan to attend
the Meeting, please fill in, date, sign and mail the enclosed proxy in the
return envelope as promptly as possible. Your proxy may be revoked at any time
prior to the Meeting. The prompt return of your completed proxy will assist the
Company in obtaining a quorum of shareholders for the Meeting, but will not
affect your ability to change your vote by subsequent proxy or by attending the
Meeting and voting in person. If you are unable to attend, your written proxy
will assure that your vote is counted.
By Order of the Board of Directors
Mark H. McKinnies
President
September 15, 1998
3
<PAGE>
PROXY STATEMENT
EARTH SCIENCES, INC.
910 12th Street
Golden, Colorado 80401
Telephone: (303) 279-7641
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 21, 1998
This Proxy Statement is furnished to the shareholders of Earth Sciences, Inc.
(the "Company"), a Colorado corporation, in connection with the solicitation of
proxies by the Company's Management and Board of Directors (collectively, the
"Board"), to be voted at the ANNUAL MEETING OF SHAREHOLDRS (the "Meeting") of
the Company to be held on Wednesday, October 21, 1998, at the Golden Community
Center, 1470 10th Street, Golden, Colorado. The Company anticipates that this
Proxy Statement and accompanying form of proxy will be first mailed or given to
Shareholders of the Company on our about September 21, 1998. The shares
represented by all proxies that are properly executed and submitted will be
voted at the meeting in accordance with the instructions indicated thereon, and
if no instructions are given then in the discretion of the proxy holder.
VOTING RIGHTS AND VOTE REQUIRED
The close of business on September 15, 1998 has been fixed by the Board of
Directors of the Company as the record date for determination of Shareholders
entitled to notice of and to vote at the Meeting. At such date there were
21,890,144 shares of the Company's $.01 par value common stock issued and
outstanding (hereinafter referred to as the "Common Stock"), each of which
entitles the holder thereof to one vote on all matters which may come before the
meeting. The Company has no class of voting securities other than Common Stock.
An abstention or withholding authority to vote will be counted as present for
determining whether the quorum requirement is satisfied. With respect to the
vote on a proposal, abstentions will be treated as shares present and entitled
to vote and, for purposes of determining the outcome of the vote on such
proposal, shall have the same effect as a vote against the proposal. A broker
non-vote occurs when a nominee holding shares for a beneficial holder does not
have discretionary voting power and does not receive voting instructions from
the beneficial owner. Broker non-votes on a particular proposal will not be
treated as shares present and entitled to vote on the proposal.
A minimum of one-half of the shares of Common Stock issued and outstanding must
be represented at the Meeting, in person or by proxy, in order to constitute a
quorum. Cumulative voting is not allowed for any purpose. Assuming a quorum is
present, the six nominees receiving the highest number of votes cast will be
elected as Directors. The affirmative vote of the holders of two-thirds of the
shares of Common Stock issued and outstanding and entitled to vote thereon will
be necessary to amend the Company's Articles of Incorporation to increase the
number of authorized shares from 25,000,000 shares to 50,000,000 shares.
4
<PAGE>
Unless specified otherwise, each proxy submitted will be noted FOR the persons
nominated by Management for directors of the Company, being Ramon E. Bisque,
Duane N. Bloom, Michael D. Durham, Robert H. Lowdermilk, Mark H. McKinnies, and
Kristen R. Armstrong, and FOR the proposal to amend the Articles of
Incorporation to increase the authorized shares from 25,000,000 shares to
50,000,000 shares.
Management knows of no other matter or motion to be presented at the meeting. If
any other matter or motion should be presented at the meeting upon which a vote
must be properly taken, it is the intention of the person named in the
accompanying form of proxy to vote such proxy in accordance with that person's
judgment, including any matter or motion dealing with the conduct of the
meeting.
Any shareholder who completes a proxy may revoke it at any time before it is
exercised by delivering written notice of such revocation to the Company (c/o
Duane N. Bloom, Secretary) 910 12th Street, Golden, Colorado, 80401, by
submitting a new proxy executed at a later date, or by requesting, in person, at
the Meeting that the proxy be returned.
Solicitation expenses will be paid by the Company. In addition to solicitation
by mail, directors, officers and other employees of the Company may, without
additional compensation, solicit proxies by mail, in person or by
telecommunication.
ELECTION OF DIRECTORS
At the Annual Meeting, the shareholders will elect six directors of the Company.
Each director will hold office until the next Annual Meeting of Shareholders and
thereafter until a successor is elected and has qualified. Cumulative voting is
not permitted in the election of directors. IN THE ABSENCE OF INSTRUCTIONS TO
THE CONTRARY, THE PERSON NAMED IN THE ACCOMPANYING PROXY WILL VOTE IN FAVOR OF
THE ELECTION OF THE FOLLOWING PERSONS NAMED AS THE COMPANY'S NOMINEES FOR
DIRECTORS OF THE COMPANY: RAMON E. BISQUE, DUANE N. BLOOM, MICHAEL D. DURHAM,
ROBERT H. LOWDERMILK, MARK H. MCKINNIES, AND KRISTEN R. ARMSTRONG. All of the
nominees are currently members of the Board of Directors. Each of the nominees
has consented to be named herein and to serve if elected. It is not anticipated
that any nominee will become unable or unwilling to accept nomination or
election, but if such should occur, the person named in the proxy intends to
vote for the election in his stead of such other person as the Management of the
Company may recommend.
The following table sets forth certain information as to each officer and
director of the Company:
5
<PAGE>
- -------------------------------------------------------------------------------
Board
Positions With Position
Name Age the Company Held Since Term Expires
Ramon E. Bisque 66 Chairman of the Board 1963 Upon Successor's
of Directors and Member Election
of the Executive Committee
Duane N. Bloom 64 Director, Secretary, 1963 Upon Successor's
Chairman of the Executive Election
Committee
Michael D. Durham 48 Director, Member of the 1997 Upon Successor's
Audit Committee Election
Robert H. Lowdermilk 61 Director, Member of the 1990 Upon Successor's
Audit Committee Election
Mark H. McKinnies 46 Director, President, 1983 Upon Successor's
Treasurer, Member of the Election
Executive Committee
Kristen R. Armstrong 34 Director, Member of the 1991 Upon Successor's
Audit Committee Election
- --------------------------------------------------------------------------------
RAMON E. BISQUE
Dr. Bisque is Professor Emeritus at the Colorado School of Mines, Golden,
Colorado and was a co-founder of the Company in 1963. Dr. Bisque has been
Chairman of the Board of Directors, a member of the Executive Committee and a
full or part time employee of the Company since 1974.
DUANE N. BLOOM
Dr. Bloom was a co-founder of Earth Sciences, Inc. in 1963. Dr. Bloom has been
employed full time by the Company since that time.
MICHAEL D. DURHAM
Dr. Durham was a co-founder in 1982 of ADA Technologies, Inc., an Englewood,
Colorado private company that contracts to the Federal government and others for
development of emission technologies. Dr. Durham is president of ADA-
Environmental Solutions, LLC, a wholly owned subsidiary of the Company. Dr.
Durham was appointed to the Board on April 30, 1997.
ROBERT H. LOWDERMILK
Mr. Lowdermilk has been president of Tectonic Construction Company, a producer
of washed aggregates and specialty sands since 1986. Mr. Lowdermilk has a long
history in construction and engineering projects.
6
<PAGE>
MARK H. McKINNIES
Mr. McKinnies is a CPA and worked for Peat, Marwick, Mitchell & Co. before
commencing employment with the Company. Mr. McKinnies joined the Company as
Accounting Manager in January 1978, was appointed Manager of Finance and
Administration in January 1979, was elected Controller of the Corporation in
January 1980, was elected Secretary in January 1981 and was elected President in
February 1983.
KRISTEN R. ARMSTRONG
Ms. Armstrong has been an attorney since her graduation from Stanford University
in 1987 and specializes in real estate and other business matters.
There are no family relationships between officers and directors of the Company.
Directors Meetings and Committees
The Board of Directors met 5 times from January 1, 1997 to August 31, 1998. All
of the directors were present for all of the meetings of Board of Directors held
during their individual incumbencies.
The Audit Committee was composed of Michael D. Durham, Robert H. Lowdermilk, and
Kristen R. Armstrong. The Audit Committee met twice from January 1, 1997 to
August 31, 1998. The Audit Committee recommends the selection and reappointment
of the Company's independent certified public accountants to the Board of
Directors and reviews the proposed scope, content and results of the audit
performed by the accountants and any reports and recommendations made by them.
The Audit Committee also serves as the Compensation Committee, which reviews and
makes recommendations to the Company's Board of Directors concerning the
salaries paid to the Company's officers. The Company has no standing nominating
committee.
PROPOSAL TO AMEND ARTICLES OF INCORPORATION TO INCREASE AUTHORIZED COMMON STOCK
On June 3, 1998 the Company's Board unanimously approved a resolution to place
before the Shareholders a proposal to amend the Company's Articles of
Incorporation to increase the number of authorized shares of the Company's
Common Stock from 25,000,000, the number of shares currently authorized, to
50,000,000 shares. For the reasons described below, the Company's Board
believes adoption of the proposed amendment is essential for the Company to have
the ability to structure financings for possible future acquisitions and to meet
the Company's other financing needs.
The Company believes that if the proposal to increase the authorized common
stock to 50,000,000 shares is not approved, the Company's ability to enhance its
growth opportunities through additional acquisition and financing transactions
or participation in other types of future transactions will be severely
hampered.
7
<PAGE>
There are currently 25,000,000 authorized shares of Common Stock and 21,890,144
shares issued and outstanding. In addition, there are outstanding exercisable
stock options and bonus plans to officers, directors and employees to purchase
an aggregate 1,117,600 shares of Common Stock of the Company. Thus, the Company
presently has 1,992,256 discretionary authorized shares of Common Stock
available for issuance for business purposes. In order to provide capital which
may be required for purchases of additional interests in mineral properties,
equity financings, mergers, and acquisitions, which capital might not be
available if there were an insufficient number of shares of authorized Common
Stock of the Company, the Board deems that it is appropriate to increase the
number of authorized shares.
The Board believes that a substantial degree of flexibility should be available
to the Company in structuring financing transactions for funding its development
properties as well as for possible acquisitions using stock or cash. The Board
of Directors believes it is prudent that the Company have authorized but
unissued shares of Common Stock for issuance from time to time as may be
required for various purposes, including issuance for equity financings,
acquisitions, employee stock options and other proper business purposes.
If the proposal to increase the authorized number of shares of Common Stock is
approved, the Company would be able to authorize the issuance of shares without
the necessity, and related costs and delays, of either calling a special
Shareholders meeting or waiting for the next regularly scheduled meeting of
Shareholders in order to increase the authorized capital. If, in a particular
instance, shareholder approval were required by law, rules of stock exchanges
where the Company's shares are listed, or otherwise deemed advisable by the
Board of Directors, then the matter would be referred to the Shareholders for
their approval. No holder of the Company's Common Stock has any preemptive or
similar right to acquire or subscribe for additional unissued or treasury shares
of the Company's Common Stock, or any other securities of any class, or rights,
warrants or options to purchase Common Stock.
Because the Company could issue a significant number of shares in connection
with future financing or acquisitions, it is possible that a change of control
of the Company could occur. However, management believes that most of the shares
sold in any financing would be sold to a number of different purchasers which
would mean that such purchasers would have to act in concert in order to effect
a change in control. There are at present no specific understandings,
arrangements or agreements with respect to any future acquisitions or other
transactions which would require the Company to issue any new shares of its
Common Stock that are proposed to be authorized by amendment of the Company's
Articles of Incorporation.
8
<PAGE>
This proposal is not intended to have any anti-takeover effect and is not part
of any series of anti-takeover measures in the Articles of Incorporation, as
amended, or the Bylaws of the Company in effect on the date of this Proxy
Statement. However, Shareholders should note that the availability of authorized
but unissued shares of Common Stock could make any attempt to gain control of
the Company or the Board of Directors more difficult or time consuming and that
the availability of authorized but unissued shares might make it more difficult
or time consuming to remove Management. Although the Board of Directors
currently has no intention of doing so, shares of Common Stock could be issued
by the Board to dilute the percentage of Common Stock owned by a significant
stockholder and increase the cost of, or the number of, voting shares necessary
to acquire control of the Board of Directors or to meet the voting requirements
imposed by Colorado law with respect to a merger or other business combinations
involving the Company. The Company is not aware of any proposed attempt to take
over the Company. The Company has no present intention to use the authorized
Common Stock for anti-takeover purposes.
The Board recommends that Shareholders vote FOR the proposed Amendment to the
Articles of Incorporation to increase the authorized shares of Common Stock.
The affirmative vote of two thirds of the issued and outstanding shares of the
Company's Common Stock entitled to vote thereon is necessary for the approval of
the proposed Amendment to the Articles of Incorporation to increase the
authorized shares of Common Stock.
THE SHARES OF COMMON STOCK REPRESENTED BY PROXIES IN THE ACCOMPANYING FORM WILL
BE VOTED FOR THE ADOPTION OF THE AMENDMENT TO INCREASE THE AUTHORIZED SHARES
FROM 25,000,000 SHARES TO 50,000,000 SHARES UNLESS A CONTRARY DIRECTION IS
INDICATED.
PRINCIPAL SHAREHOLDERS
The table below sets forth information, as of August 31, 1998, with respect to
beneficial ownership of the Company's Common Stock by each person known by the
Company to be the beneficial owner of more then 5% of its outstanding Common
Stock, by each director of the Company, by each Executive Officer and by all
officers and directors of the Company as a group. With the exception of Mr.
Lowdermilk, each of the individuals named below has sole voting and investment
power for the respective shares.
9
<PAGE>
- -------------------------------------------------------------------------------
Amount and Nature of
Name and Address Beneficial Ownership Percent of Class
Ramon E. Bisque 488,281 (1) 2.2%
(Chairman of the Board of Directors)
9113 Fern Way, Golden, CO
Duane N. Bloom (Director and Secretary) 690,622 (2) 3.2%
5565 Pine Ridge Rd., Golden, CO
Michael D. Durham (Director) 692,269 3.2%
5252 Lariat Drive, Castle Rock, CO
Robert H. Lowdermilk (Director) 841,889 (3) 3.8%
100 Cherry St., Denver, CO
Mark H. McKinnies 287,055 (4) 1.3%
(Director and President)
10134 S. Pinedale Dr., Conifer, CO
Kristen R. Armstrong (Director) 7,644 Less than 1%
6585 Caminito Northland, La Jolla, CA
Directors and Officers as a Group 3,040,760 (5) 13.9%
(7 individuals)
- -------------------------------------------------------------------------------
Notes:
(1) Included in the amount shown are 146,640 shares to which Dr. Bisque has
the right to acquire beneficial ownership through convertible debt
and stock options.
(2) Included in the amount shown are 164,370 shares to which Dr. Bloom has the
right to acquire beneficial ownership through convertible debt and stock
options.
(3) Included in the amount shown are 125,000 shares registered in the name of
Mr. Lowdermilk's wife, Ann Gragg Lowdermilk. Also included in the amount
shown are 370,115 shares to which Tectonic Construction Co. ("TCC") has
the right to acquire beneficial ownership through convertible debt and
stock options. Mr. Lowdermilk is the president and majority shareholder of
TCC.
(4) Included in the amount shown are 234,010 shares to which Mr. McKinnies has
the right to acquire beneficial ownership through convertible debt
and stock options.
(5) The amount shown includes 940,135 shares to which individuals in the group
have the right to acquire beneficial ownership through convertible debt
and stock options.
10
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes the total compensation of the Executive Officers
of the Company for the Company's last three fiscal years. Except as set forth
below under "Stock Option Plan" and "Pension Plan," there were no compensation
plans for which cash or non-cash distributions, other than salaries made during
the last year:
Summary Compensation Table
Annual Compensation Long Term Compensation
Name of Individual and Awards
Principal Position Year Salary Other(2) Securities Underlying Options (#)
- --------------------------------------------------------------------------------
Ramon E. Bisque (1) 1997 $85,175 $12,291 25,000
Chairman of the Board 1996 $81,288 $11,706 50,000
1995 $74,765 $11,148 25,000
Duane N. Bloom (1) 1997 $114,564 $16,388 25,000
Chairman of the 1996 $107,240 $15,607 50,000
Executive Committee 1995 $101,931 $14,864 25,000
Mark H. McKinnies (1) 1997 $116,618 $17,400 25,000
President and Treasurer 1996 $101,568 $15,142 50,000
1995 $ 96,763 $13,735 25,000
- --------------------------------------------------------------------------------
Member of the Executive Committee of Earth Sciences, Inc., which performs the
duties of the Chief Executive Officer.
Amounts represent pension and matching 401(k) payments made to a qualified plan
by Earth Sciences, Inc. for the benefit of the named individual.
OPTION GRANTS IN LAST FISCAL YEAR
Shown below is information at December 31, 1997 with respect to the options
granted to Executive Officers in the last fiscal year.
Number of Securities % of Total Options Exercise
Underlying Options Granted to Employees or Base Expiration
Name Granted (#) in Fiscal Year Price ($/Sh) Date
- --------------------------------------------------------------------------------
Ramon E. Bisque 25,000 33% $1.88 10/30/00
25,000 $1.25 11/3/98*
Duane N. Bloom 25,000 33% $1.88 10/30/00
25,000 $1.25 11/3/98*
Mark H. McKinnies 25,000 33% $1.88 10/30/00
25,000 $1.25 11/3/98*
- --------------------------------------------------------------------------------
* Represents options granted in 1994 whose expiration date was extended from
11/2/97 to 11/3/98. All options shown for each individual were exercisable as of
December 31, 1997.
11
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION TABLE
VALUE
Shown below is information at December 31, 1997 with respect to the exercised
and unexercised options to purchase the Company's Common Stock to Executive
Officers under the Non-Qualified Stock Option and Stock Grant plan.
Number of Securities Underlying Value of Unexercised
Name Unexercised Options at FY-End (#) Options at FY-End
- --------------------------------------------------------------------------------
Ramon E. Bisque 125,000 $ 0
Duane N. Bloom 125,000 $ 0
Mark H. McKinnies 225,000 $ 0
- --------------------------------------------------------------------------------
All options shown for each individual were exercisable as of December 31, 1997.
Compensation of Directors
Directors who are not also executive officers of the Company are accruing
compensation in the amount of $500 per quarter, which amount may be paid by
issuance of the Company's common stock, and are reimbursed for any out-of-pocket
expenses incurred in attendance at meetings. The number of shares of stock which
may be issued will be determined using the quarterly compensation amount and the
average between the bid and asked price quoted during the quarter. A total of
25,252 shares of stock were issued in 1997 in payment of $38,500 of accrued fees
through year end 1996.
Certain Relationships and Related Transactions
At various times during 1997 and 1996, Dr. Bisque borrowed a total of $50,000
and $70,000, respectively, from the Company at an interest rate of 8%. Not more
than $70,000 was outstanding at any one time in 1996 and these loans were paid
back to the Company prior to each year end. All of the amounts borrowed were
collateralized by amounts owing to Dr. Bisque by the Company and were made
available from funds that would have otherwise only earned the Company 5%.
In 1991, the Company converted a total of $366,000 of deferred salaries payable
to Mssrs. Bisque, Bloom, and McKinnies to notes payable bearing interest at 9%,
payable on demand, and granted them rights to convert such notes payable to
shares of common stock at the current market price of $.54 per share. The notes
are collateralized by a mining property. From year to year, Mssrs. Bisque,
Bloom, and McKinnies have agreed not to demand payment during the current year.
As of December 31, 1997, $38,000 remained outstanding under the notes.
In 1997, the Company issued a convertible debenture in the amount of $1,000,000
(the "Debenture") to Tectonic Construction Co. ("TCC") and borrowed $500,000
from TCC under a short-term note (the "Note"). Mr. Lowdermilk, a director of the
Company, is the president and majority shareholder of TCC. These amounts were
collateralized by a mining property, and buildings, equipment, receivables and
inventory in Calgary. The Debenture and the Note bear interest at the greater of
prime plus two points or 10% which interest is payable quarterly. The Debenture,
if not converted, is due March 31, 2000. The Debenture is convertible at any
time after November 30, 1997 into shares of common stock at a weighted average
rate of $3.12. The Note was repaid in full in February 1998.
12
<PAGE>
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership with the Securities an Exchange Commission (the "SEC"). Officers,
directors and greater than ten percent shareholders are required by SEC
regulation to furnish the Company with copies of all Section 16(a) forms they
file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company believes
that during the fiscal year ended December 31, 1997, all filing requirements
applicable to its officers, directors and greater than ten percent beneficial
owners were complied with except that Dr. Bisque was late filing his Form 5
reporting two gifts of stock, Mr. Lowdermilk was late filing his Form 5
reporting one transaction and Mr. McKinnies was late filing his Form 5 reporting
two gifts of stock. In addition, Dr. Durham did not timely file his Initial
Report on Form 3 and had one late filing reporting one transaction on From 4.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors of the Company anticipates engaging Hein & Associates,
LLP as the independent auditors for the fiscal year ending December 31, 1998
subject to determination of the terms of that engagement towards the end of
1998. The Company anticipates that a representative of Hein & Associates, LLP,
who conducted the audit for the year ended December 31, 1997, will be present at
the Annual Meeting of Shareholders. There have been no disagreements on matters
of accounting principles or practices, financial statement disclosures nor of
audit scope or procedures between the Company and Hein & Associates, LLP during
the two most recent fiscal years nor any subsequent interim periods. The
representative of Hien & Associates, LLP will be available to respond to
Shareholder questions and will have the opportunity to make a statement at that
time if the representative desires to do so.
PROPOSALS OF SHAREHOLDERS FOR PRESENTATION
AT THE NEXT ANNUAL MEETING OF SHAREHOLDERS
The Company anticipates that the next Annual Meeting of Shareholders will be
held in August 1999. Any Shareholder of record of the Company who desires to
submit a proper proposal for inclusion in the proxy material related to the net
Annual Meeting of Shareholders must do so in writing and it must be received at
the Company's principal executive officers on or before February 28, 1999. If a
shareholder intends to submit a proposal at the meeting that is not included in
the Company's proxy statement, and the Shareholder fails to notify the Company
prior to May 1, 1999 of such proposal, then the proxies appointed by the
Company's management would be allowed to use their discretionary voting
authority when the proposal is raised at the annual meeting, without any
discussion of the matter in the proxy statement. The proponent must own 1% or
more of the outstanding shares or $2,000.00 in market value, of the Company's
Common Stock and must have owned such shares for one year in order to present a
shareholder proposal to the Company.
ANNUAL REPORT ON FORM 10-KSB
The Annual Report on Form 10-KSB concerning the operation of the Company during
the calendar year ended December 31, 1997, including certified financial
statements for the year then ended, is available upon request to shareholders of
the Company. Exihibits listed in Form 10-KSB are available upon request to
shareholders at a nominal charge for printing and mailing.
OTHER MATTERS
The Board knows of no other business to be presented at the Annual Meeting of
Shareholders. If other matters properly come before the Meeting, the persons
named in the accompanying form of Proxy intend to vote on such other matters in
accordance with their best judgment.
13
<PAGE>
PROXY For an Annual Meeting of Stockholders of PROXY
EARTH SCIENCES, INC.
Proxy Solicited on Behalf of the Board of Directors
THIS PROXY WILL BE VOTED FOR OR AGAINST OR WITHHELD OR ABSTAINED IN RESPECT OF
THE MATTER LISTED IN ACCORDANCE WITH THE CHOICE, IF ANY, INDICATED IN THE SPACE
PROVIDED. IF NO CHOICE IS INDICATED, THE PROXY WILL BE VOTED FOR SUCH MATTER.
IF ANY AMENDMENTS OR VARIATIONS ARE TO BE VOTED ON, OR ANY FURTHER MATTER COMES
BEFORE THE MEETING, THIS PROXY WILL BE VOTED ACCORDING TO THE BEST JUDGMENT OF
THE PERSON VOTING THE PROXY AT THE MEETING; PROVIDED, THAT IF THE UNDERSIGNED
INDICATES AN AGAINST CHOICE FOR MATTER NO. 1 BELOW, THEN THIS PROXY MAY NOT BE
VOTED FOR ANY ADJOURNMENT OF THE MEETING. THIS FORM SHOULD BE READ IN
CONJUNCTION WITH THE ACCOMPANYING NOTICE OF MEETING AND PROXY STATEMENT.
NOTES:
1. Please date and sign (exactly as the shares represented by this Proxy are
registered) and return promptly. Where the instrument is signed by a
corporation, its corporate seal must be affixed and execution must be made by an
officer or attorney thereof duly authorized. If no date is stated by the
Shareholder(s), the Proxy is deemed to bear the date upon which it was mailed by
management to the Shareholder(s).
2. To be valid, this Proxy form, duly signed and dated, must arrive at the
office of the Company's transfer agent, American Securities Transfer & Trust,
Inc., 938 Quail Street, Suite 101, Lakewood, Colorado 80215, not less than
forty-eight (48) hours (excluding Saturdays, Sundays and holidays) before the
day of the Meeting or any adjournment thereof.
The undersigned shareholder of Earth Sciences, Inc. (the "Company") hereby
appoints Ramon E. Bisque, Duane N. Bloom or, failing them, Mark H. McKinnies as
nominee of the undersigned to attend, vote and act for and in the name of the
undersigned at the Annual Meeting of the Shareholders of the Company (the
"Meeting") to be held at the Golden Community Center, 1470 Tenth Street, Golden,
Colorado on Wednesday, October 21, 1998, at the hour of 9:00 a.m. (local time),
and at every adjournment thereof, and the undersigned hereby revokes any former
proxy given to attend and vote at the meeting.
THE NOMINEE IS HEREBY INSTRUCTED TO VOTE AS FOLLOWS WITH RESPECT TO THE
FOLLOWING MATTER:
1. FOR [ ] AGAINST [ ] ABSTAIN [ ] To approve the amendment of the
Company's Articles ofIncorporation to
increase the number of authorized
shares from 25,000,000 to 50,000,000
shares.
2. FOR [ ] WITHELD [ ] Election of Directors.
Nominees:
Ramon E. Bisque
Duane N. Bloom
Michael D. Durham
Robert H. Lowdermilk
Mark H. McKinnies
Kristen R. Armstrong
[ ] For all nominees, except the following:
---------------------------------------------
14
<PAGE>
Dated this _____ day of ________________, 1998.
_____________________________________________________________
Signature of Shareholder(s) (Please sign exactly as your name(s)
appear on the mailing label below.)
_____________________________________________________________
(Please print name of Shareholder[s])
