NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 21, 2000
MINING SERVICES INTERNATIONAL
TO THE SHAREHOLDERS:
You are cordially invited to attend the Annual Meeting of Shareholders of Mining
Services International Corporation ("the Company") which will be held at the
Hampton Inn, 10690 South Holiday Park Drive, Sandy, Utah on Thursday, December
21, 2000, commencing at 2:00 p.m. (Mountain Time) for the following purposes:
1. To elect seven (7) Directors to serve until the next Annual Meeting of
Shareholders or until their successors shall be elected and duly qualified;
2. To consider and vote upon a proposal to ratify the appointment of Tanner
+ Co. to be the Company's independent public accountant for the year ending
2000; and
3. To transact such other business as may properly come before the Annual
Meeting of Shareholders or at any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on November 20, 2000
as the record date for the determination of shareholders entitled to receive
notice of and to vote at the Annual Meeting of Shareholders and any adjournment
or postponement thereof. A list of those entitled to vote will be available for
inspection for ten (10) days prior to the meeting at the offices of the Company.
By Order of the Board of Directors
/S/
____________________________
Salt Lake City, Utah Duane W. Moss
November 20, 2000 Secretary
IMPORTANT
Whether or not you expect to attend the Annual Meeting in person, to assure
that your shares will be represented, please complete, date, sign and return the
enclosed proxy without delay in the enclosed envelope, which requires no
additional postage if mailed in the United States. Your proxy will not be used
if you are present at the Annual Meeting and desire to vote your shares
personally.
<PAGE>
MINING SERVICES INTERNATIONAL CORPORATION
8805 South Sandy Parkway
Sandy, UT 84070-6408
_______________________
PROXY STATEMENT
_______________________
Annual Meeting of Shareholders
December 21, 2000
SOLICITATION OF PROXIES
This Proxy Statement is being furnished to the shareholders of Mining
Services International, a Utah Corporation (the "Company" or "MSI") in
connection with the solicitation by the Board of Directors of the Company of
proxies from holders of outstanding shares of the Company's Common Stock for use
at the Annual Meeting of Shareholders of the Company to be held Thursday,
December 21, 2000, and at any adjournment or postponement thereof (the "Annual
Meeting"). This Proxy Statement, the Notice of Annual Meeting of Shareholders
and the accompanying form of proxy are first being mailed to shareholders of the
Company on or about November 20, 2000.
The Company will bear all costs and expenses relating to the solicitation
of proxies, including the costs of preparing, printing and mailing to
shareholders this Proxy Statement and accompanying material. In addition to the
solicitation of proxies by mail, the directors, officers and employees of the
Company, without receiving additional compensation therefore, may solicit
proxies personally or by telephone. Arrangements will be made with brokerage
firms and other custodians, nominees and fiduciaries for the forwarding of
solicitation materials to the beneficial owners of the shares of Common Stock
held by such persons, and the Company will reimburse such brokerage firms,
custodians, nominees and fiduciaries for reasonable out-of-pocket expenses
incurred by them in connection therewith.
VOTING
Record Date
The Board of Directors has fixed the close of business on November 20, 2000
as the Record Date for determination of shareholders entitled to notice of and
to vote at the Annual Meeting (the "Record Date"). As of the Record Date, there
were issued and outstanding 7,314,260 shares of Common Stock, par value $.001
per share. The holders of record of the shares of Common Stock on the Record
Date entitled to be voted at the Annual Meeting are entitled to cast one vote
per share on each matter submitted to a vote at the Annual Meeting. Accordingly,
a total of 7,314,260 shares are entitled to be cast on each matter submitted to
a vote at the Annual Meeting.
Proxies
Shares of the Common Stock which are entitled to be voted at the Annual
Meeting and which are represented by properly executed proxies will be voted in
accordance with the instructions indicated on such proxies. If no instructions
are indicated, such shares will be voted (i) FOR the election of each of the
seven director nominees; (ii) FOR the ratification of the appointment by the
Board of Directors of Tanner + Co. to be the independent public accountant for
the Company for the year ending December 31, 2000; and (iii) in the discretion
of the proxy holders as to any other matters which may properly come before the
Annual Meeting.
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A shareholder who has executed and returned a proxy may revoke it at any
time prior to its exercise at the Annual Meeting by executing and returning a
proxy bearing a later date, by filing with the Secretary of the Company, at the
address set forth above, a written notice of revocation bearing a later date
than the proxy being revoked, or by voting the Common Stock covered thereby in
person at the Annual Meeting.
Required Vote
A majority of the outstanding shares of the Company's common stock entitled
to vote, represented in person or properly executed proxy, is required to
constitute a quorum. Abstentions and broker non-votes, which are indications by
a broker that it does not have discretionary authority to vote on a particular
matter, will be counted as "represented" for the purpose of determining the
presence or absence of a quorum. Under Utah corporate law, once a quorum is
established, shareholder approval with respect to a particular proposal is
generally obtained when the votes cast in favor of the proposal exceed the votes
cast against such proposal.
In the election of Directors, shareholders will not be allowed to cumulate
their votes. The seven nominees receiving the highest vote totals will be
elected as Directors of the Company. For approval of the proposed ratification
of the independent public accountant, the votes cast in favor of the proposal
must exceed the votes cast against the proposal. Accordingly, abstentions and
broker non-votes will not have the effect of being considered as votes cast
against the nominees or the proposed ratification.
ELECTION OF DIRECTORS
At the Annual Meeting seven directors of the Company are to be elected to
serve until the next Annual Meeting of Shareholders and until their successors
shall be duly elected and qualified. Each of the nominees for director
identified below is currently a director of the Company. If any of the nominees
should be unavailable to serve, which is not now anticipated, the proxies
solicited hereby will be voted for such other persons as shall be designated by
the present Board of Directors. The seven nominees receiving the highest number
of votes at the Annual Meeting will be elected.
Nominees for Election as Directors
Certain information with respect to each nominee is set forth below:
Nathan L. Wade, 72, has been a Director of the Company since June 1989.
Since 1953, Mr. Wade has been a Director and principal owner of Nate Wade
Subaru, a Salt Lake City, Utah automobile deal- ship for new and used
automobiles. Mr. Wade was appointed Chairman of the Board on January 21, 2000.
M. Garfield Cook, 59, was appointed to the Board of Directors of the
Company on April 4, 2000 and on April 25, 2000 was appointed as Co-Chairman of
the Board. From 1972 to 1989 Mr. Cook was President and Chief Executive Officer
of IRECO Chemicals, an industrial explosives company with about 1700 employees
serving the natural resource industry worldwide. He has served on the boards of
a number of corporations involved in the explosives and mining industry. He is
also a past Chairman of the Institute of Makers of Explosives in Washington,
D.C. From 1988 to 1995 Mr. Cook was Chairman of Non-Invasive Medical Technology
Corporation (NMT) involved in developing and producing specialized medical
devices, and from 1991 to 1995 he also served as Chairman of In-Line Diagnostics
Corporation (IDC), an affiliate of NMT. Mr. Cook has been a private investor
since 1995 and has served in executive positions with several civic
organizations in Salt Lake City. Mr. Cook is a 1966 graduate of the University
of Utah with a B.S. degree in Physics.
Dr. John T. Day, 61, has been President and Chief Executive Officer of the
Company since April 1993. He was one of the founders of the Company and from
1979 to 1993 was Executive Vice President with responsibility for plant design,
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operations, equipment design and construction, and new product development. Dr.
Day was appointed a member of the Board of Directors on November 10, 1986 and
was appointed the Chief Executive Officer of the Company in 1993. Dr. Day
obtained a B.S. degree in Chemical Engineering from the University of Utah in
1964 and obtained a Sc.D. degree from MIT in 1972.
James E. Solomon, 50, C.P.A., was appointed a director of the Company in
March 2000. He is managing partner at Red Rock Investors, LLC, a venture capital
firm. Mr. Solomon specializes in maximizing value for small to mid-size
companies. He was formerly a financial manager at Exxon Corporation from 1972 to
1980. From 1980 to 1983 Mr. Solomon was Vice President of Farm Management
Company, one of the world's largest agricultural companies. Currently Mr.
Solomon is an Adjunct Professor at the Graduate School of Business at the
University of Utah.
James W. Sight, 44, was appointed a director of the Company on April 4,
2000. Mr. Sight graduated from the Wharton School of Finance in 1977. Mr. Sight
is an investor and financial consultant. He currently serves on the Boards of
Directors of US Home (NYSE), Westmoreland Coal (AMEX) and United Recycling
Industries.
Bryan Bagley, 36, was appointed a director of the Company on June 28, 2000.
Since November 1991, Mr. Bagley has been a market maker for Wilson-Davis &
Company. From April 1990 through November 1991, Mr. Bagley was a trader for
Covey & Co. Previously he was a securities trader for Bagley Securities for four
years and in the late 1980's was a stockbroker for Wilson-Davis & Co. Mr. Bagley
graduated from the University of Utah in 1987 with a Bachelor of Science degree
in Economics.
Frances Flood, 44, was appointed a director of the Company on June 28,
2000. Ms. Flood is the President, Chief Executive Officer and Chairman of
Gentner Communications Corp. Ms. Flood joined Gentner in October 1996 as the
Vice President of Sales and Marketing. Prior to joining Gentner, Ms. Flood was
Area Director of Sales and Marketing for Ernst & Young, LLP, an international
accounting and consulting firm. She graduated from Thomas Edison State College
with a BSBA degree in Banking and Finance.
Board of Directors Meetings and Committees
There were nine (9) regular meetings of the Board of Directors held during
1999. All of the Directors attended all of the meetings or were present via
teleconferencing.
The Company presently has standing audit and compensation committees of the
Board of Directors. The audit committee makes recommendations concerning the
engagement of the Company's independent public accountant and reviews the
results and independence of the accountants and the scope, adequacy and results
of the internal auditing procedures. The Company's audit committee consists of
Nathan L. Wade, James Solomon and Frances Flood. Functions of the compensation
committee include making recommendations concerning Director and senior
management remuneration and overseeing the Company's stock option and other
compensation plans. The compensation committee consists of Nathan L. Wade and
Garfield Cook. Each of the committees normally meets when regular board meetings
are held. No separate compensation is paid for committee attendance or
assignments.
Director Compensation
During 1999, the non-employee directors received $7,200 per year as
compensation for serving on the Board of Directors and $1,000 per meeting and
reimbursement for out-of-pocket expenses. Employee members of the Board of
Directors received no compensation for attendance at meetings of the Board of
Directors. Due to increased time commitments as Board members, during 2000, the
Board of Directors approved the issuance of stock options to the directors. On
August 2, 2000 each director was granted 39,500 stock options at an exercise
price equal to the market price existing on the date of grant of $1.4375. These
options are immediately exercisable for a period of five years. The options are
subject to the terms and conditions of the Company's 1988 Stock Option Plan.
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EXECUTIVE OFFICERS
In addition to Dr. Day, certain information is furnished with respect to
the following executive officers of the Company:
Richard M. Clayton, 59, was first employed by the Company from 1981 to
1983. Mr. Clayton joined the Company again in 1986 as Director of Marketing and
was appointed Vice President in 1991. Prior to joining the Company, Mr. Clayton
held key management and marketing positions with Texaco Petroleum Corporation
and Nitrate Services Corporation, an explosives company.
David P. Reddick, 44, has been employed by the Company since 1985 as
Director of Operations. In 1991, Mr. Reddick was appointed Vice President. Prior
to joining the Company, Mr. Reddick was associated with Cyprus Minerals in
operations management. Mr. Reddick obtained a B.S. degree in Resource Economics
from the University of California at Berkeley.
Duane W. Moss, 52, has been employed by the Company since December 1994. He
was appointed Senior Vice President and General Counsel in 2000. Previously, Mr.
Moss served as Chief Financial Officer and Legal Counsel. Prior to joining the
Company, Mr. Moss was a self-employed consultant and from 1989 to 1992 was the
Secretary, Treasurer and Chief Financial Officer of Alta Gold Co. Mr. Moss
obtained a Juris Doctorate in 1976 and a B.A. degree in Accounting in 1973 from
the University of Utah.
Douglas W. Later, 47, has been employed by the Company since September
1998. He was appointed Vice President in 2000 in charge of Research and
Development and certain operations relating to the Eastern U.S. explosives
business. During 1998 and 1999 he was the Assistant to the President responsible
for research and development activities of the Company and the manufacturing of
its packaged explosives products. From 1989 to 1998, Dr. Later was president of
Mountain States Analytical, a testing and research laboratory. Dr. Later has
eighteen years experience in the chemicals industry and management of
operations. He received his bachelor's degree in Chemistry in 1978 and a Ph.D.
in analytical chemistry in 1982 from Brigham Young University.
Wade L. Newman, CPA, 41, has been employed by the Company since February
1999. In 2000 he was appointed as Chief Financial Officer of the Company.
Previously he was the Company's Controller. Mr. Newman was Vice President and
CFO, Secretary and Treasurer of Recovery Corporation from 1991 to 1999 and was
with Ernst & Young from 1985 to 1991 having served as a Manager in the audit
department. Mr. Newman received a Bachelor's degree in Accounting from Brigham
Young University in 1985.
EXECUTIVE COMPENSATION
Set forth below is information concerning the annual and long-term
compensation for services in all capacities to the Company and its affiliates
for the fiscal years ended December 31, 1999, 1998 and 1997 of those persons who
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were, as of March 30, 2000, (i) the Chief Executive Officer and (ii) the other
executive officers whose total annual salary and bonus exceeded $100,000 during
the fiscal year ended December 31, 1999 (the "Named Executive Officers").
Compensation of Executive Officers
The following table summarizes compensation received by the Named Executive
Officers of the Company for the three fiscal years ended December 31, 1999, 1998
and 1997.
<TABLE>
<CAPTION>
Annual Compensation
Name and Position Other Annual All Other
Salary Bonus Compensation Compensation
Year $ $(1) $(2) $(3)
------------------------ ---------- ----------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C>
Dr. John T. Day 1999 75,000 100,000 19,123 7,477
President and Chief 1998 120,000 132,000 20,601 3,600
Executive Officer 1997 120,000 125,500 16,049 3,600
Duane W. Moss 1999 100,000 10,000 4,550 3,087
Sr. Vice President and 1998 80,000 10,000 6,110 2,255
General Counsel 1997 77,150 27,500 3,915 2,255
</TABLE>
(1) Includes all cash and non-cash bonuses paid on a discretionary basis by the
Board of Directors as recommended by the Compensation Committee. In the case of
Dr. Day, the grant of a $100,000 bonus was for performance achieved in 1998 and
not paid in 1999. The right to receive payment of the bonus, however, is solely
in the discretion of Dr. Day.
(2) Includes life and disability insurance premiums and tax services paid on
behalf of Dr. Day and medical reimbursement payments and personal mileage on
company-owned vehicles on the part of the Named Executive Officers.
(3) Includes matching contributions made by the company on behalf of the Named
Executive Officers pursuant to the Mining Services International Profit Sharing
401(k) Plan.
Option Grants in Last Fiscal Year
No individual grants of stock options were made to the Named Executive
Officers during the fiscal year ended December 31, 1999.
Aggregated Option/SAR Exercises and Fiscal Year End Option/SAR Value
The following table sets forth the aggregate value of unexercised options
to acquire shares of the Common Stock held by the Named Executive Officers on
December 31, 1999 and the value realized upon the exercise of options during the
fiscal year ended December 31, 1999.
<TABLE>
<CAPTION>
Number of Value of Unexercised
Shares Unexercised In-the-Money Options/SARs
Acquired Options/SARs at FY-End ($)(1)
On Value At FY-End (#) Exercisable/Unexercisable
Name Exercise Realized Exercisable/Unexercisable
---------------------------- ----------- ----------- ----------------------------- ----------------------------
<S> <C> <C> <C>
Dr. John T. Day None None None
President and Chief
Executive Officer
Duane W. Moss None 36,566 / 66,415 $0
Sr. Vice President and
General Counsel
</TABLE>
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(1) Reflects the difference between the exercise price of the options granted
and the value of the Common Stock on December 31, 1999. The closing price of the
Common Stock on December 31, 1999, as reported by NASDAQ was $3.00 per share.
The options granted are subject to risks of forfeiture and a vesting schedule.
In the case of Mr. Moss, 13,283 options may vest yearly on the anniversary date
of the option grant, subject to Board of Directors approval.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following tabulation shows as of November 20, 2000 the number of shares
of the Company's common stock, par value $0.001, owned beneficially by: (a) all
persons known to be the holders of more than five percent (5%) of the Company's
voting securities, (b) Directors, (c) named Executive Officers and (d) all
Officers and Directors of the Company as a group:
<TABLE>
<CAPTION>
Amount and Nature of
Beneficial ownership (1)
________________________
Name and Address of Beneficial Owner Shares Percent
<S> <C> <C>
E. Bryan Bagley --------------------------------------------------------- 2,111,034(2) 27.40%
1470 Arlington Dr.
Salt Lake City, UT 84103
Dr. Lex L. Udy --------------------------------------------------------- 560,906(3) 7.28%
4597 Ledgemont Drive
Salt Lake City, Utah 84124
Dr. John T. Day -------------------------------------------------------- 615,804(7) 7.99%
5 Dawn Hill
Sandy, Utah 84092
Edward N. Bagley Estate -------------------------------------------------- 583,280 7.57%
8987 St. Ives Drive
Los Angeles, California 90069
Nathan L. Wade ------------------------------------------------------- 262,992(4) 3.41%
1207 South Main Street
Salt Lake City, Utah 84111
Duane W. Moss ----------------------------------------------------------- 72,310(5) .94%
7952 So. Siesta Drive
Sandy, UT 84093
All Officers and Directors
as a group (12 persons) ------------------------------------------------- 3,388,240(6) 43.98%
__________________________________________________________________________________
</TABLE>
(1) Unless otherwise indicated, each person identified in the table has sole
voting and investment power with respect to the Company's Common Stock
beneficially owned by such person. The total number of outstanding shares
included in the computation of percentages is 7,314,260 plus 389,981 options
which are exercisable or become exercisable by executives and directors within
60 days.
(2) Includes 1,883,287 shares held by the BLA Irrevocable Investment Trust of
which Mr. Bagley is a co-trustee with a sister, Lisa Higley, and 39,500 options
currently exercisable by Mr. Bagley.
(3) Includes shares owned solely by Dr. Udy's wife and shares in a family
limited partnership.
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(4) Includes shares held by a partnership of which Mr. Wade is a partner, shares
held in an IRA account for the benefit of Mr. Wade's spouse and shares held by
Mr. Wade's family members residing in his home; also included are 39,500 options
currently exercisable by Mr. Wade.
(5) Includes options for 36,566 shares which are presently exercisable or will
become exercisable within 60 days.
(6) Includes shares controlled by Mr. Bagley as co-trustee of the BLA
Irrevocable Investment Trust; and includes 389,981 shares which are currently
exercisable or which become exercisable by the directors and executive officers
of the Company within 60 days.
(7) Includes 49,500 options currently exercisable by Dr. Day.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires the Company's executive officers and directors and
persons who own more than ten percent of a registered class of the Company's
stock, to file reports of initial ownership and changes in ownership with the
Securities and Exchange Commission (the "SEC"). Executive officers, directors
and persons who own more than ten percent of the Company's stock, are required
by SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file. Based solely on a review of the copies of such forms furnished to the
Company and written representations from the Company's executive officers and
directors, the Company noted that all required forms, including amendments
thereto, were timely filed during the past fiscal year, except Forms 4 were not
timely filed for (1) Dr. John T. Day regarding a charitable gift of Common Stock
of the Company for 8,000 shares made on or about December 30, 1999, (2) Mr.
Duane W. Moss regarding a charitable gift made by him of 3,200 shares made on or
about December 31, 1999 and (3) Mr. Nathan L. Wade regarding a purchase of 2,000
shares by his wife on or about September 9, 1999 and a disposition from trust of
136 shares on or about November 25, 1999. In each of the three cases regarding
Form 4's, Form 5's were filed to correct the untimely filings. The failure to
timely file was due to extended travel of the executives coupled with procedural
oversight. The Company issues monthly reminders to each executive and director
of the Company to help ensure timely filing of reports promulgated under Section
16(a) of the Exchange Act.
Certain Relationships and Related Transactions
On April 10, 1998, the Company provided John T. Day a five-year loan of
$75,000 at LIBOR 30-day rate plus 1% adjusted annually each year on the
anniversary date. Interest is payable annually with principal due on the date of
maturity. The loan is secured with shares of Company stock owned by Dr. Day.
RATIFICATION OF SELECTION OF AUDITOR
The Audit Committee has recommended, and the Board of Directors has
selected, the firm of Tanner +Co., independent certified public accountants, to
audit the financial statements of the Company for the year ending December 31,
2000. Tanner + Co. has audited the financial statements of the Company since
1993. Representatives of Tanner + Co. are expected to be present at the Annual
Meeting of Shareholders, will have an opportunity to make a statement, if they
desire to do so, and are expected to be available to respond to appropriate
questions.
The Board of Directors unanimously recommends that the shareholders vote
FOR ratification of the appointment of Tanner + Co. as the Company's independent
public accountant.
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OTHER MATTERS
As of the date of this Proxy Statement, management knows of no other
matters to be presented at the Annual Meeting. If any further business should
properly come before the meeting, the persons named as proxies will vote on such
business in accordance with their best judgment.
PROPOSALS OF SHAREHOLDERS
Proposals which shareholders intend to present at the Annual Meeting to be
held in 2001 must be received by Duane W. Moss, Secretary, at the Company's
executive offices, 8805 South Sandy Parkway, Sandy, UT 84070-6408, no later than
January 31, 2001.
ADDITIONAL INFORMATION
The Company will provide without charge to any person from whom a Proxy is
solicited by the Board of Directors, upon the written request of such person, a
copy of the Company's 1999 Annual Report on Form 10-K, including the financial
statements and schedules thereto (as well as exhibits thereto, if specifically
requested) required to be filed with the SEC. Written requests for such
information should be directed as set forth below:
THE CORPORATE SECRETARY
MINING SERVICES INTERNATIONAL CORPORATION
8805 S. Sandy Parkway
Sandy, UT 84070-6408
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