UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K/A-1
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1998
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
Commission file No. 0-6202-2
NORD RESOURCES CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 85-0212139
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
201 3rd St NW, Suite 1750, Albuquerque, NM 87102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (505) 766-9955
Securities registered pursuant to Section 12 (b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, par New York Stock Exchange
value $.01 per share
Securities registered pursuant to Section 12 (g) of the Act:
None
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]
Aggregate market value of voting stock held by non-affiliates,
based on the closing price of $.6875 as of March 23, 1999, was
$10,098,668.
The number of shares of Common Stock outstanding as of March 23,
1999 was 21,905,488.
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Each director holds office until the next annual meeting of
stockholders and until their successors are elected and qualified.
There are no family relationships among any nominees or directors or
among them and any officer of the Corporation or any of its
subsidiaries.
Set forth below is certain information for each director and each
executive officer named in the Summary Compensation Table.
Director
Directors Age Since
W. Pierce Carson 56 1994
Edgar F. Cruft 66 1971
Terence H. Lang 62 1978
Leonard Lichter 71 1984
Marc Franklin 45 1996
James Askew 51 1998
Francis Waldron 55 1998
Other Named Executive Officer
Ray W. Jenner 47 1998
Background Of Directors
Dr. Carson holds a Ph.D. in Economic and Structural Geology and
was appointed President and Chief Executive Officer of the Corporation
effective June 1, 1997. He is also President, Chief Executive Officer
and a director of Nord Pacific Limited ("Nord Pacific"), a company
which is 28.5% owned by the Corporation. He has held these positions
with Nord Pacific since its inception in 1990. From 1980 to 1990, he
served as Senior Vice President of Pacific operations for the
Corporation.
Dr. Cruft holds a Ph.D. in Geochemistry and is a founder of the
Corporation. He served as its Chairman since the Corporation's
inception in 1972 and as Chief Executive Officer from inception until
May 31, 1997. He was President of the Corporation from inception to
1985 and from 1988 until May 31, 1997. Dr. Cruft is also Chairman of
Nord Pacific.
Mr. Franklin has been employed since 1975 by J&S Franklin
Holdings and Management Services Ltd., London, England, a manufacturer
of military and civil equipment, and has served as a director and has
been a shareholder of such corporation since 1977.
Mr. Lang served as Senior Vice President-Finance and Treasurer
upon joining the Corporation in 1978 until his retirement on December
31, 1997. Prior thereto, he had 15 years of experience in financial
planning and management in the business equipment industry, holding
several financial management positions with NCR Corporation. Mr. Lang
is also a director of Nord Pacific.
2
<PAGE>
Mr. Lichter, an attorney and a CPA, is a principal in the law
firm of Spitzer & Feldman P.C., New York, New York, which is counsel
to the Corporation. He is also a director of Nord Pacific.
Mr. Askew, a mining engineer, is President of International
Mining and Finance Corporation, a private mining and venture capital
company. He was a founder and the Chief Executive Officer of Golden
Shamrock Mines Limited and sits on a number of boards of mining and
exploration companies in North America, Europe and Australia.
Mr. Waldron has been with Mutual of New York in various
capacities since 1968 and is currently Senior Vice President,
International Operations, a position he has held since 1994. Mr.
Waldron is also President and Chief Operating Officer of MONY
International Holdings, MONY Life Insurance Company of the Americas
and MONY Bank and Trust Company.
Other Named Executive Officer
Mr. Ray W. Jenner, Chief Financial Officer of the Corporation and
Nord Pacific since February 1998, is a chartered accountant who holds
a Bachelor of Commerce Degree in Management Science and a Bachelor of
Science Degree in Physics and Mathematics. He has 25 years experience
in domestic and international financial environments, and for 14 years
was Vice President and Treasurer of Echo Bay Mines where he was
involved in raising equity and securing debt financing both in Canada
and the U.S. Prior to Echo Bay, he spent ten years with Price
Waterhouse in Canada, Australia and Indonesia.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), requires the Corporation's directors, executive
officers and beneficial holders of more than 10% of the Corporation's
Common Stock to file with the Securities and Exchange Commission
initial reports of ownership and reports of changes in ownership of
the common stock of the Corporation. Based on the Corporation's
review of copies of such forms it received from directors, executive
officers and beneficial holders of more than 10% of the Corporation's
common stock and on written representations from certain of such
persons, the Corporation believes that, during the year ended December
31, 1998, all filing requirements under Section 16(a) of the Exchange
Act were made by such persons on a timely basis.
3
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
The following table discloses compensation received by the
Corporation's Chief Executive Officer and the other most highly paid
executive officers at December 31, 1998 (collectively, "Named
Executive Officers") for the fiscal years ended December 31, 1998,
1997 and 1996.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long-Term
Compensation
Awards
-------
Annual Securities
Compensation(1) Underlying All Other
Name and Principal Position Year Salary ($) Options(4) (Shares) Compensation ($)
- ------------------------------------- ------ ---------------- -------------------- ----------------
<S> <C> <C> <C> <C>
Edgar F. Cruft 1998 119,200 (2) 78,750 (5) 59,861 (9)
Chairman 1997 346,771 (2) 127,775 (6) 91,537 (9)
1996 576,874 (2) 33,750 (5) 25,379 (9)
W. Pierce Carson 1998 350,000 (3) --
President & Chief Executive 1997 300,580 (3) 600,000 (7) 71,377 (10)
Officer
Ray W. Jenner 1998 153,125 35,000 (8) 42,124 (11)
Chief Financial Officer
Terence H. Lang 1998 -- 45,000 (5) 50,000 (12)
Sr. VP-Finance Treasurer 1997 271,615 77,775 (6) 19,493 (12)
1996 261,555 5,709 (12)
</TABLE>
_______________________________
1 Non-cash benefits for each of the Named Executive Officers were
less than 10% of their aggregate compensation.
2 Includes $55,760 salary earned in 1998 as chairman and $112,904 and
$166,810 salary earned in 1997 and 1996, respectively, as chairman
and CEO of Nord Pacific. Dr. Cruft was also President and Chief
Executive Officer of the Corporation until June 1, 1997.
3 Includes $200,000 and $213,080 salary earned in 1998 and 1997,
respectively, as President and CEO of Nord Pacific.
4 Number of shares subject to options granted under stock option
plans for the periods presented.
5 Replaced expired option for identical number of shares and exercise
price.
6 Includes options to replace expired options to purchase 77,775
shares for identical exercise prices.
7 Includes 200,000 options which become exercisable on May 27, 1999.
4
<PAGE>
8 Includes 17,500 shares which become exercisable on January 30, 2000.
9 Included in "All Other Compensation" for Dr. Cruft are matching
contributions under 401(k) Retirement and Savings Plan totaling
$842 in 1998, $23,099 in 1997, including $20,820 matched by Nord
Pacific Limited under its plan, and $24,921 in 1996, including
$20,820 matched by Nord Pacific. Also includes the dollar value of
life insurance premiums paid by the Company with respect to the
benefits for Dr. Cruft totaling $3,780, $6,776 and $458 for 1998,
1997 and 1996 respectively, debt forgiveness of $50,000 in both
1998 and 1997 respectively, as part of the restructuring of
management as of June 1, 1997, and the fair market value of
automobiles provided Dr. Cruft totaling $10,627 in 1997.
10 Included in "All Other Compensation" for Dr. Carson are matching
contributions under a 401(k) Retirement and Savings Plan totaling
$10,000 in 1998 matched by Nord Pacific Limited under its plan, and
$20,760 matched by Nord Pacific in 1997. Also includes the dollar
value of life insurance policies paid by the Company with respect to
benefits to Dr. Carson of $5,110 in 1998 and $4,925 in 1997 of which
$4,325 was paid by Nord Pacific, the fair market value of an
automobile provided Dr. Carson of $3,850 paid by Nord Pacific in
1997 and cash compensation paid by Nord Pacific of $57,957 and
$41,840 in 1998 and 1997 as a living allowance since Nord Pacific
requires Dr. Carson to spend a portion of his time in Australia.
11 Included in "All Other Compensation" for Mr. Jenner are matching
contributions under a 401(k) Retirement and Savings Plan of $4,813.
Also includes the dollar value of life insurance premiums paid by
the Company of $761 and relocation costs of $41,363.
12 Included in "All Other Compensation" for Mr. Lang are matching
contributions under a 401(k) Retirement and Savings Plan of $4,996
and $4,750 for 1997 and 1996, respectively. Also included are the
dollar value of life insurance premiums paid by the Company with
respect to benefits to Mr. Lang of $5,955 and $959 in 1997 and 1996,
respectively, the fair market value of an automobile provided Mr.
Lang of $6,768 in 1997 and debt forgiveness of $50,000 in 1998 as
part of the restructuring of management as of June 1, 1997.
___________________________
5
<PAGE>
The Corporation had established a loan program to fund the
exercise of stock options Dr. Cruft and Mr. Lang, who were executive
officers. Such loans were limited to $150,000 for each executive, are
callable on 90 day notice by the Board and bear interest, payable
quarterly, at 1/2% over the yield on funds invested by the
Corporation. The largest amount of indebtedness outstanding during
1998 from Messrs. Cruft and Lang was $100,000 each. $50,000 of Dr.
Cruft's loan was forgiven on June 1,1998 and $50,000 was forgiven on
June 1, 1997 as part of the restructuring of management as of June 1,
1997. $50,000 of Mr. Lang's loan was forgiven on January 1, 1998 as
part of the restructuring of management as of June 1, 1997. The
amount currently outstanding from Messrs. Cruft and Lang totals
$50,000 each. See "Employment Agreements".
OPTION GRANTS IN 1998
The following table presents information concerning options
granted in 1998 to Named Executive Officers under the Corporation's
employee option plans.
<TABLE>
<CAPTION>
Individual Grants
----------------------------------------------
Number of % of Potential Realizable Value at
Securities Total Assumed Annual Rates of
Underlying Options Stock Price Appreciation for
Options Granted Exercise Expiration Option Term ($) (6)
Name Granted (1) in 1998 (4) Price (5) ($) Date 5% 10% 0%
- ------------------- ------------ ----------- -------------- ------------ ---------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Edgar F. Cruft 45,000 (2) 25.2% 6.67 01/20/00 -- -- --
33,750 (3) 18.9% 4.88 10/25/00 -- -- --
Ray W. Jenner 35,000 (3) 19.6% 1.38 01/30/08 30,380 76,965 --
Terence H. Lang 45,000 (2) 25.2% 6.67 01/20/00 -- -- --
</TABLE>
_________________________
1 All options are exercisable at April 30, 1999 unless otherwise
noted.
2 Replaced expired option for identical number of shares and exercise
price.
3 Options to purchase 17,500 shares become exercisable on January 30,
2000.
4 The Corporation granted options to purchase 178,750 shares in 1998,
including options to purchase 123,780 shares issued to replace
expired options for the identical number of shares and exercise
price.
5 Exercise price is equal to market price at date of grant, other
than the replacement grants noted in footnote 2 above, the exercise
price of all of which are in excess of market price at date of their
grant.
6 Dollar amounts under these columns are the result of calculations
based on assumed annualized rates of stock appreciation as
prescribed by the Securities and Exchange Commission. The assumed
rates are not intended by the Corporation to forecast possible
future appreciation, if any, of its stock price, which will be
determined by future events and unknown factors.
________________________
6
<PAGE>
AGGREGATED OPTION EXERCISES IN 1998 AND YEAR-END OPTION VALUES
The following table presents information concerning options
exercised during 1998 by the Named Executive Officers and the value of
their respective unexercised options at December 31, 1998.
<TABLE>
<CAPTION>
Number of
Securities Value (1)
Underlying Unexercised In-
Unexercised the-Money
Options at Options at
Shares December 31, 1998 December 31, 1998
Acquired Value Exercisable/ Exercisable/
Name On Exercise Realized Unexercisable Unexercisable ($)
- -------------------- ----------- -------- ------------------ ------------------
<S> <S> <S> <C> <C>
Edgar F. Cruft None N/A 246,525 --
W. Pierce Carson None N/A 415,000 --
200,000 --
Ray W. Jenner None N/A 17,500 --
17,500 --
Terence H. Lang None N/A 162,775 --
__________________________
1 Based on closing sale price of $1.09375 for the Corporation's
Common Stock on December 31, 1998 on the New York Stock Exchange
Composite Tape.
__________________________
</TABLE>
EMPLOYMENT AGREEMENTS
Effective May 31, 1997, Dr. Cruft retired as President and Chief
Executive Officer ("CEO") of the Corporation. He continues to retain
the title of Chairman of the Board. Effective June 1, 1997, the Board
of Directors appointed Dr. Pierce Carson President and Chief Executive
Officer, titles he currently holds with Nord Pacific Limited.
Further, effective December 31, 1997, Terence H. Lang retired and
resigned as Senior Vice President-Finance and Treasurer. In February
1998, the Board of Directors appointed Raymond W. Jenner Vice
President-Finance and Chief Financial Officer.
The Corporation has an Employment Agreement (the "Carson
Agreement") with Dr. Carson describing among other things his duties
as President and CEO, his compensation level and perquisites. The
term of the Agreement is from June 1, 1997 through and including May
31, 1999 and automatically extends from year to year unless
termination notice is given by Dr. Carson or the Corporation not less
than 90 days prior to the expiration of the term of the Carson
Agreement. (See "Compensation of CEO" below).
The Corporation also has a Continuation of Employment Agreement
(the "Cruft Continuation") with Dr. Cruft which runs from June 1, 1998
until May 31, 1999, with automatic year to year extensions. Under the
terms of the Cruft Continuation, Dr. Cruft serves as Chairman of the
Board and devotes no less than 12.5% of his time to the Corporation.
For these services, Dr. Cruft is compensated at a rate of $50,000 per
7
<PAGE>
year plus reimbursements for office expenses, part-time secretarial,
and travel and other expenses incurred on behalf of the Corporation,
and also received title to the vehicle provided by the Corporation at
no cost. Dr. Cruft also receives retirement benefits totaling
$226,653 per year under the terms of the Corporation's non-qualified
retirement plan. This benefit will be paid for the longer of 10 years
or for the life of Dr. Cruft and his spouse. Further Dr. Cruft
received options to purchase 50,000 shares of the Corporation's common
stock at $4.00 per share. At May 31, 1997, Dr. Cruft owed $150,000 to
the Corporation under the terms of a loan program as described under
"Compensation of Executive Officers". As per the terms of the Cruft
Continuation, $50,000 of his loan was forgiven on June 1, 1997,
$50,000 was forgiven on June 1, 1998 and $50,000 will be forgiven on
June 1, 1999 so long as Dr. Cruft does not voluntarily terminate his
involvement with the Corporation.
On January 1, 1998, under the terms of the Corporation's non-
qualified retirement plan, Mr. Lang began receiving retirement
benefits. As per the terms of the retirement plan, he elected to
exercise the lump sum payment option. Under the terms of the option,
the Corporation paid to Mr. Lang in cash the present value of his
future benefits, less 12% of such amount in a lump sum payment, but
only to the extent that funds were available in the related trust
established to fund Mr. Lang's benefit. This payment totaled
$877,800. Since the amount received by Mr. Lang was less than the
total accrued benefit, Mr. Lang receives payments totaling $7,247
monthly. This benefit will be paid for the longer of 10 years or for
the life of Mr. Lang and his spouse. Further, at December 31, 1997,
he owed the Corporation $150,000 as described under "Compensation of
Executive Officers" in this document. $50,000 of his loan was
forgiven on January 1, 1998 and $50,000 on January 1, 1999. The
$50,000 balance will be forgiven on January 1, 2000 so long as Mr.
Lang does not voluntarily terminate his involvement with the Company
as a director.
DEFINED BENEFIT RETIREMENT PLAN
The following table illustrates the estimated annual benefit
payable upon retirement to Dr. Carson at specified levels of
compensation and years of service to the Corporation.
<TABLE>
<CAPTION>
Years of Service
Compensation 10 15 20 25 30
- ------------- -------- -------- -------- --------- --------
<C> <C> <C> <C> <C> <C>
$ 100,000 $ 15,000 $ 22,500 $ 30,000 $ 37,500 $ 45,000
$ 125,000 $ 18,750 $ 28,125 $ 37,500 $ 46,875 $ 56,250
$ 150,000 $ 22,500 $ 33,750 $ 45,000 $ 56,250 $ 67,500
$ 175,000 $ 26,250 $ 39,375 $ 52,500 $ 65,625 $ 78,750
$ 200,000 $ 30,000 $ 45,000 $ 60,000 $ 75,000 $ 90,000
</TABLE>
The non-qualified retirement agreement with Dr. Carson designated by
the Board provides annual payments for a period of 15 years beginning
at age 62, or on termination of employment, whichever is later (or
anytime after age 55 in the event the provisions of the agreement with
respect to early retirement are satisfied). The payments are equal to
1.5% for each year of service to a maximum of 30 years times Dr.
Carson's average annual compensation over this last three years of
employment. The compensation covered by the plan is based on Dr.
Carson's annual salary disclosed in the Summary Compensation Table.
The portion of the percentage earned through years of service vests at
8
<PAGE>
the rate of 20% per year, beginning at six years of service, and
becomes fully vested in the event of a change in control of the
Corporation as defined in the agreements. If Dr. Carson dies prior to
reaching retirement, the agreements provide for payment of a death
benefit to his beneficiary in an amount equal to three times the
compensation earned during the year prior to this death, in lieu of
the above payments after retirement.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Philosophy
The Corporation applies a consistent philosophy to compensation
for all employees, including senior management. This philosophy is
based on the premise that the achievements of the Corporation result
from the coordinated efforts of all individuals working toward common
objectives. The Corporation strives to achieve those objectives
through teamwork that is focused on meeting the periodic goals
established by the Corporation, the expectations of customers and
stockholders. The compensation program goals are to enable the
Corporation to attract, retain and reward key personnel who contribute
to the long-term success of the Corporation and to align compensation
with business objectives and performance. The Corporation's
compensation program for executive officers is based on the same
principles applicable to compensation decisions for all employees of
the Corporation.
Competitive Compensation
The Corporation is committed to providing a compensation program
that helps attract and retain key personnel of outstanding ability.
The Corporation ensures that its compensation is competitive by
comparing its compensation practices with those of other similar
companies and reflects this review in its determination of
compensation.
Compensation of CEO
Dr. Carson is compensated by the Corporation at $150,000 per
year. This compensation rate became effective June 1, 1997, the date
of Dr. Carson's appointment as President and CEO of the Corporation.
Dr. Carson's salary will increase to $225,000 per year upon
achievement of positive cash flow from operations for three
consecutive months of the Corporation's 50% owned affiliate, Sierra
Rutile Limited. Further, Dr. Carson was issued options to purchase
600,000 shares of the Corporation's common stock, 200,000 shares at
$4.00 per share, 200,000 shares at $5.00 per share and 200,000 shares
at $6.00 per share, which options expire on May 31, 2002 (see
"Compensation of Executive Officers").
Compensation and Performance
Executive officers are rewarded based upon corporate performance
and individual performance. Corporate performance is evaluated by
reviewing the extent to which strategic and business plan goals are
met, including such factors as operating profit or loss and
performance relative to competitors. Individual performance is
evaluated by reviewing organizational and management development
progress against set objectives and the degree to which teamwork and
Corporation values are fostered.
9
<PAGE>
The Corporation strives to achieve a balance of the compensation
paid to a particular individual and the compensation paid to other
executives both inside the Corporation and at comparable companies.
The Corporation believes that employees should understand the
performance evaluation and compensation administration process. The
process of assessing performance is as follows:
1. At the beginning of the performance cycle, the evaluating manager
sets objectives and key goals.
2. The evaluating manager gives the employee ongoing feedback on
performance.
3. At the end of the performance cycle, the manager evaluates
the accomplishments of objectives/key goals.
4. The manager compares the results with the results of peers
within the Corporation.
5. The evaluating manager communicates the comparative results
to the employee.
6. The comparative result affects decisions on salary and stock
options.
Compensation Vehicles
The Corporation has a successful history of using a simple total
compensation program that consists of cash, equity based compensation
and retirement plans. Having a compensation program that allows the
Corporation to successfully attract and retain key employees permits
it to mine and produce its industrial minerals at competitive levels
of production and costs, to provide useful products and services to
customers, enhance stockholder value, motivate technological
innovation, foster teamwork and adequately reward employees. The
vehicles are:
Cash Based Compensation - The Corporation sets base salary for
employees by reviewing the aggregate of base salary and annual
bonus for competitive positions in the market, and by reviewing
the employee's historical compensation and the effect of
inflation on such compensation.
Stock Option Program - The purpose of this program is to provide
additional incentives to employees to work to maximize
stockholder value. The option program also utilizes vesting
periods to encourage key employees to continue in the employ of
the Corporation. The Corporation grants stock options annually
to a broad-based population representing approximately 50% of the
total employee pool.
Deferred Compensation for Senior Executives - The Corporation has
entered into separate retirement agreements with its senior
executives. The agreements provide benefits to the senior
executives upon retirement based on several factors, including
the number of years of service to the Corporation. The purpose
of these retirement agreements is to provide incentive to the
senior executives to continue to provide their services to the
Corporation.
401-K Plan - The Corporation provides a retirement and savings
plan for its salaried U.S. employees pursuant to Section 401(k)
of the Internal Revenue Code. Each employee may contribute up to
15% of his or her salary to this plan, to a maximum of $9,500 in
10
<PAGE>
1997. Under the plan, the Corporation makes a matching
contribution on behalf of each participating employee of 50% of
the lower of the first 6% of each employee's salary or the
percentage actually contributed by the employee. This plan
enables the Corporation to attract and retain employees upon whom
the Corporation relies in operating its business.
Compensation Committee
Leonard Lichter, Chairman
Dr. Edgar Cruft
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee in 1998 were Dr. Cruft
and Mr. Lichter. Mr. Lichter, Chairman of the Compensation Committee,
is a principal in the firm of Spitzer & Feldman P.C., which firm
provides legal services to the Corporation. Dr. Cruft is Chairman of
the Board. He retired as President and CEO effective June 1, 1997.
He served as an officer of the Corporation from 1969 until June 1997.
11
<PAGE>
STOCKHOLDER RETURN ON COMMON STOCK
The following graph compares the total annual return on the
Corporation's Common Stock with the total annual return of the Dow
Jones Equity Market Index and the Dow Jones Mining Index. The
presentation assumes $100 was invested on December 31, 1993 in the
Corporation's Common Stock and in each of the indices and any
dividends were reinvested.
Comparison of Five-Year Cumulative Total Returns
Performance Graph for
Nord Resources Corporation
Prepared by the Center for Research in Security Prices
Produced on 04/26/1999 including data to 12/31/1998
[DELETED PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
Legend
CRSP Total Returns Index for: 12/1993 12/1994 12/1995 12/1996 12/1997 12/1998
<S> <C> <C> <C> <C> <C> <C>
Nord Resources Corporation 100.0 133.3 48.7 87.2 39.7 20.5
NYSE Stock Market (US Companies) 100.0 100.0 135.5 164.3 218.3 262.0
NYSE Stocks (SIC 1000-1099 US + Foreign) 100.0 90.6 105.5 109.4 79.0 63.1
Metal mining
Notes:
A. The lines represent monthly index levels derived from compounded daily
returns that include all dividends.
B. The indexes are reweighted daily, using the market capitalization on
the previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a
trading day, the preceding trading day is used.
D. The index level for all series was set to $100.0 on 12/31/1993.
</TABLE>
12
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth the only persons known by the
Board to be beneficial owners of more than 5% of the outstanding
shares of Common Stock of the Corporation:
Shares Beneficially
Owned as of
April 30, 1999
Name and Address of ----------------------------
Beneficial Owner Number % of Class
---------------------- ---------- -----------
MIL (Investments) S.A. 7,004,200 32.0%
Boulevard Royal 25B
L-2449
Luxembourg, Luxembourg
MIL (Investments) S.A. ("MIL") acquired 3,160,000 shares from
the Corporation pursuant to a Stock Purchase and Sale Agreement dated
April 15, 1996, 840,000 shares in a Loan Conversion on June 4, 1996,
2,000,000 shares in a Stock Purchase and Sale Agreement dated October
2, 1996 and 1,004,200 shares purchased on the open market. The
transactions with the Company were private placements in reliance upon
the transaction "safe harbor" afforded by Regulation S, as promulgated
by the Securities and Exchange Commission under the Securities Act of
1933, as amended.
Set forth below is certain information for each nominee for
election as a director and each executive officer named in the Summary
Compensation Table and employed by the Corporation on April 30, 1999.
Shares Beneficially
Owned as of
April 30, 1999 (1)
Name and Address of --------------------------------
Beneficial Owner Number % of Class
- ------------------------------ ------------ ------------
W. Pierce Carson 671,040 (2) 3.0%
Edgar F. Cruft 303,869 (3) 1.4%
Marc Franklin 65,000 (4) (9)
Terence H. Lang 179,633 (5) (9)
Leonard Lichter 66,000 (6) (9)
James Askew (10) 50,000 (4) (9)
Francis Waldron (10) -- (9)
Other Named Executive Officer
Ray W. Jenner 19,500 (7) (9)
All nominees for election of
directors and other
named executive officer as a 1,355,042 (8) 5.9%
group (8 persons)
13
<PAGE>
________________________________
1 Ownership includes sole voting and investment power except as
otherwise noted. When applicable, the number of shares beneficially
owned includes the number of unissued shares which the listed person
(or group) has a right to acquire within 60 days after April 30,
1999. In determining the number of shares outstanding for computing
the percent of class owned by a listed person (or group), the number
of shares outstanding of the Corporation has been increased by the
number of unissued shares which the listed person (or group) has a
right to acquire from the Corporation within 60 days after April 30,
1999.
2 Includes options to purchase 615,000 shares.
3 Includes options to purchase 246,525 shares. Dr. Cruft's wife and
children own an additional 57,727 shares as to which Dr. Cruft
disclaims beneficial ownership.
4 Consists of options to purchase shares.
5 Includes options to purchase 162,775 shares. Mr. Lang's wife owns
an additional 21,348 shares as to which Mr. Lang disclaims
beneficial ownership.
6 Includes options to purchase 65,000 shares.
7 Includes options to purchase 17,500 shares.
8 Includes options to purchase 1,221,800 shares held by directors and
named executive officer as a group.
9 Represents less than 1% of the shares outstanding.
10 Director is a MIL Nominee. MIL is indirectly 100% owned by Jean-
Raymond Boulle. There is no family relationship between any of the
MIL Nominees and Jean-Raymond Boulle. MIL, as of April 30, 1999,
beneficially owned 7,004,200 shares of Common Stock of the
Corporation, which amount represents 32.0% of the issued and
outstanding shares of Common Stock. Jean-Raymond Boulle also owns
directly 10,000 shares.
_________________________
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In connection with various agreements with MIL, the size of the
Board is required to be seven (7) members. MIL has the right to
nominate three (3) nominees to the Board (the "MIL Nominees") and the
Board (excluding the MIL Nominees) has the right to nominate the
remaining four (4) nominees. MIL is obligated to vote its shares for
the four Board nominees through and including voting at the annual
meeting to be held in 1999. The Corporation has agreed to nominate
and use its best efforts to obtain the election of the MIL Nominees at
each annual or special meeting of stockholders called for the purpose
of filling positions on the Board through and including the annual
meeting to be held in 1999. Such actions shall include, without
limitation, soliciting persons for the election of directors
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(including the MIL Nominees) and recommending the MIL Nominees for
election to the Board in the same manner as all other nominees of the
Board for election as directors. If any MIL Nominee shall resign, be
removed or be unable to serve for any reason prior to the expiration
of such MIL Nominee's term as a director, MIL is required to notify
the Board of a replacement MIL Nominee and the Board is required to
take all action necessary to cause such replacement MIL Nominee to be
elected or appointed to fill the unexpired term of the withdrawing MIL
Nominee. In addition, the size of the Board cannot be increased or
decreased without the approval of at least two (2) of the MIL
Nominees.
Members of the Board who are not employed by the Corporation,
except Mr. Lichter, receive an annual retainer of $10,000, plus $1,000
for attending each meeting of the Board and $800 for attending each
meeting of a Committee of the Board. Mr. Lichter, counsel to the
Corporation, charges his time and expenses to the Corporation through
Spitzer & Feldman P.C.
The Corporation has a deferred compensation program for
directors, other than directors who are employees of the Corporation,
its subsidiaries or affiliates or are affiliated with entities which
provide services to the Corporation. Under this program, a qualifying
director who has served as a director for ten years will receive a
lifetime payment, beginning at the later of age 65 or his termination
as a director, in an amount equal to the annual retainer paid to the
director during his last year of service as a director. A qualifying
director may elect to receive a reduced payment beginning at age 62,
provided he is not a director at that time. Messrs. Askew, Franklin
and Waldron are eligible for this program.
The Corporation paid $191,768 for legal services during 1998 to
the firm of Spitzer & Feldman, P.C. in which Leonard Lichter, a
director, is a principal.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
NORD RESOURCES CORPORATION
/s/RAY W. JENNER
RAY W. JENNER
VICE PRESIDENT FINANCE -
AUTHORIZED OFFICER
APRIL 30, 1999
