SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. _)
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Mercer International Inc.
(Names of Registrant as Specified in Its Charter)
(Names of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (check appropriate box):
|X| No filing fee.
|_| Fee computed on table below per Exchange Act rules 14a-6(i)(4) 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
computes 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:
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
MERCER INTERNATIONAL INC.
Burglistrasse 6
8002 Zurich
Switzerland
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of
Mercer International Inc.:
Notice is hereby given that the Annual Meeting of Shareholders of Mercer
International Inc., a Massachusetts trust organized under the laws of the State
of Washington (the "Company"), will be held at Hauptstrasse 16, D 07365
Blankenstein, Germany at 9:00 a.m., Central Europe Time, July 13, 1999, for the
following purposes:
1. To elect two (2) Trustees of the Company.
2. Amendment of the Company's Non-qualified Stock Option Plan to
increase the number of shares available for issuance from
2,000,000 shares to 3,600,000 shares.
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Trustees have fixed the close of business on May 21, 1999, as the
record date for the determination of Shareholders entitled to notice of and to
vote at the Annual Meeting.
By Order of the Trustees
Jimmy S.H. Lee
President
June 1, 1999
SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING ARE REQUESTED TO COMPLETE,
SIGN, DATE AND RETURN THE PROXY IN THE ENCLOSED ENVELOPE. INSTRUCTIONS FOR THE
PROPER EXECUTION OF PROXIES ARE SET FORTH IN THE PROXY STATEMENT.
<PAGE>
MERCER INTERNATIONAL INC.
PROXY STATEMENT
This statement is furnished in connection with the solicitation by the
management of Mercer International Inc. (the "Company") of proxies for use at
the Annual Meeting of Shareholders to be held at Hauptstrasse 16, D 07365
Blankenstein, Germany on July 13, 1999, and any adjournments thereof. If the
Proxy is properly executed and received by the Company prior to the meeting or
any adjournment thereof, the Shares represented by your Proxy will be voted in
the manner directed. In the absence of voting instructions, the shares will be
voted for each of the proposals. The Proxy may be revoked at any time prior to
its use by filing a written notice of revocation of Proxy or a later dated Proxy
with the Secretary of the Company, Mr. Maarten Reidel, c/o Suite 1250, 400
Burrard Street, Vancouver, British Columbia V6C 3A6, bearing a date later than
the date of the Proxy or by giving oral notice of revocation at the meeting. You
may also revoke your Proxy in person at the meeting. If you attend the meeting
and have submitted a Proxy, you need not revoke your Proxy and vote in person
unless you elect to do so. The Proxy Statement and form of Proxy are being
mailed to Shareholders commencing on or about June 2, 1999.
The affirmative vote of at least a majority of the shares of beneficial
interest ("Shares") cast in person or by proxy at the Annual Meeting is required
to approve each proposal. The holders of one-third of the outstanding Shares and
entitled to vote at the Annual Meeting, present in person or represented by
proxy, constitute a quorum. Under applicable Washington law, abstentions and
broker non-votes will be counted for purposes of establishing a quorum, but will
have no effect on the vote on either of the proposals.
Proxies will be solicited primarily by mail and may also be solicited
personally and by telephone by Trustees and regular employees of the Company
without additional remuneration therefor. The Company may also reimburse banks,
brokers, custodians, nominees and fiduciaries for their reasonable charges and
expenses in forwarding Proxies and Proxy materials to the beneficial owners of
the Shares. All costs of solicitation of Proxies will be borne by the Company.
The Company does not presently intend to employ any other party to assist in the
solicitation process.
The close of business on May 21, 1999, has been fixed as the record
date (the "Record Date") for the determination of Shareholders entitled to
notice of and to vote at the Annual Meeting.
Voting Securities and Principal Shareholders
The holders of record of 16,034,846 Shares of the Company issued and
outstanding on the Record Date will be entitled to one vote per Share at the
meeting. Under the Company's Declaration of Trust, cumulative voting in the
election of Trustees is not permitted. Trustees will be elected by the majority
of votes cast at the meeting.
<PAGE>
The following table sets forth certain information regarding the
beneficial ownership of the Company's Shares as of April 30, 1999, by each
shareholder who is known by the Company to own more than five percent of the
outstanding Shares. The following is based solely on statements on filings with
the Securities and Exchange Commission or other information the Company believes
to be reliable.
<TABLE>
<CAPTION>
Name and Address Number Percent of
of Beneficial Owner of Shares Outstanding Shares
<S> <C> <C>
FMR Corp.1 1,842,000 11.5%
82 Devonshire Street
Boston, MA 02109
Schneider Capital Management 1,166,000 7.3%
460 E. Swedesford Street
Suite 1080
Wayne, PA 19087
Princeton Services Inc.2 1,610,785 10.0%
800 Scudders Mill Road
Plainsboro, NY 08536
Kennedy Capital Management Inc. 1,477,4013 9.2%
425 N. New Ballas Road
Suite 181
St. Louis, MO 63141
Greenlight Capital, L.L.C. 1,421,000 8.9%
420 Lexington Ave.
Suite 875
New York, NY 10170
</TABLE>
<PAGE>
PROPOSAL 1
ELECTION OF TRUSTEES
Pursuant to resolutions of the Trustees under authority granted by the
Company's Declaration of Trust, the number of Trustees of the Company is
established at five. The votes of a majority of the Shares cast in person or by
Proxy at the Annual Meeting are required to elect the Trustees.
The Board of Trustees is divided into three classes. Initially, Class I
Trustees were elected for one year, Class II Trustees were elected for two years
and Class III Trustees were elected for three years. Successors to the class of
Trustees whose term expires at any annual meeting shall be elected for three
year terms. One of the nominees for Trustee, Mr. Jimmy Lee, is member of Class
II, and is to be elected to the Board of Trustees for a three-year term to serve
until the annual meeting of shareholders in 2002, or until his successor is
elected and qualified. Mr. Lee currently serves as a Trustee. The other nominee,
Mr.R. Ian Rigg, is not currently a Trustee and is nominated to be a member of
Class II and to be elected to the Board of Trustees for a three-year term to
serve until the annual meeting of shareholders in 2002, or until his successor
is elected and qualified.
Mr. Lee and Mr. Rigg each have indicated that he is willing and able
to serve as a Trustee. If the nominee is unable or unwilling to serve, the
accompanying proxy may be voted for the election of such other person as shall
be designated by the Trustees. Proxies received by the Trustees on which no
designation is made will be voted FOR the nominee.
Trustees
The following table sets forth information regarding each nominee for
election as a Trustee and each Trustee whose term of office will continue after
the Annual Meeting.
<TABLE>
<CAPTION>
Expiration of
Name Current Position with the Company Age Term as a Trustee
<S> <C> <C> <C>
Jimmy S. H. Lee Chairman, President and Trustee 42 1999
C. S. Moon Trustee 52 2001
Maarten Reidel Secretary and Chief Financial Officer
and Trustee 35 2001
Michel Arnulphy Trustee 65 2000
R. Ian Rigg Nominee for Trustee 55
</TABLE>
Jimmy S.H. Lee has been a Trustee since May, 1985, and Chief Executive
Officer of the Company since 1992. Mr. Lee is a director of Med Net
International Ltd.
C. S. Moon has been a Trustee since June 1994. Mr. Moon is an
independent consultant. From 1990 until 1998, he was Executive Director of Shin
Ho Group of Korea, an international paper manufacturer headquartered in Korea.
Prior to joining Shin Ho in 1990, Mr. Moon previously served in managerial
positions with Moo Kim Paper Manufacturing Co., Ltd. and Sam Yung Pulp Co.,
Ltd., both in Korea.
Maarten Reidel has been Chief Financial Officer and a Trustee since
December 1996, a Managing Director of Spezialpapierfabrik Blankenstein GmbH
("SBG") since November 1994 and the Chairman of the Management Board of Dresden
Papier AG ("DPAG") from 1992 to 1994, a member of the German government agency
responsible for the privatization of government-owned companies from 1992 to
1994, and an accountant with Arthur Andersen & Co. from 1987 to 1992.
Michel Arnulphy has been a Trustee since June 1995. From 1998 to the
present, Mr. Arnulphy has been the Managing Director of Electro Orient Ltd., a
merchandising trading company located in Hong Kong. From 1975 to 1998, Mr.
Arnulphy was Managing Director of J. Mortenson & Co., Ltd., a manufacturer of
water treatment equipment in Hong Kong.
R. Ian Rigg is a nominee for Trustee. He has been the chief financial
officer and a director of Advanced Project Ltd. since 1996 and of Terrawest
Industries, Inc. since 1989. He is a director of Carlin Resources Corp. and a
nominee director and officer of Bank Gospodarki of Poland. Mr. Rigg is a
chartered accountant in Canada.
During the fiscal year ended December 31, 1998, the Trustees held no
board meetings but acted on six occasions by resolution adopted by unanimous
written consent. Under the Declaration of Trust of the Company, resolutions may
be adopted by written consent signed by a majority of the Trustees.
Committees of the Board
The Company has established an Audit Committee. The function of the Audit
Committee is to meet with and review the results of the audit of the Company's
financial statements performed by the independent public accountants and to
recommend the selection of independent public accountants. The members of the
Audit Committee are Mr. Michel Arnulphy and Mr. C. S. Moon. The Audit Committee
did not meet during 1998.
The Company has also established a Compensation Committee. The members
of the Compensation Committee are Mr. C. S. Moon and Mr. Michel Arnulphy. The
primary duty of the Compensation Committee is to grant stock options under the
Company's 1992 Non-Qualified Stock Option Plan and to award bonuses to employees
and consultants under the Company's Incentive Bonus Plan. The Compensation
Committee did not meet during 1998, but acted by written consent on one
occasion.
The Company does not have a Nominating Committee.
Security Ownership of Management
The following table sets forth information regarding ownership of the
Company's Shares on the April 30, 1999, by (i) each Trustee, nominee for Trustee
and Named Executive Officer (as defined below); and (ii) all Trustees and
executive officers of the Company as a group. Unless otherwise indicated, each
Named Executive Officer and Trustee has sole voting and disposition power with
respect to the Shares set forth opposite his name. Each such person has
indicated that he will vote all Shares owned by him in favor of the nominees for
Trustee and in favor of each of the other proposals.
<TABLE>
<CAPTION>
Shares
Beneficially Percent
Name of Owner Owned of Ownership
<S> <C> <C>
Jimmy S.H. Lee(1) 172,333 1.1%
C.S. Moon(2) 12,000 *
Michel Arnulphy(2) 6,000 *
Maarten Reidel(3) 191,667 1.2%
Ron Aurell(4) 46,700 *
Trustees and Officers as a
Group
(5 persons)(5) 428,700 2.6%
* Less than 1%.
(1) Includes presently exercisable stock options to acquire 158,333 shares.
(2) Represents presently exercisable stock options.
(3) Includes presently exercisable stock options to acquire 71,667 shares.
(4) Includes presently exercisable stock options to acquire 10,000 shares.
(5) Includes presently exercisable stock options to acquire 258,000 shares.
</TABLE>
Executive Compensation
The following table sets forth information on the annual compensation
for each of the Company's last three fiscal years of the chief executive officer
( the "CEO") and each of the Company's four most highly compensated executive
officers other than the CEO who received aggregate annual remuneration from the
Company in excess of $100,000 during the fiscal year ended December 31, 1998
(collectively, with the CEO, the "Named Executive Officers").
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
Securities
Underlying
Name and Principal Other Annual Options/ All Other
Position Year Salary($) Bonus($) Compensation($) SARs(#) Compensation($)
------------------ ---- --------- -------- --------------- ------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Jimmy S.H. Lee 1998 221,326 151,200 0 90,000 0
Chief Executive Officer 1997 263,781 101,540 0 160,000 0
1996 293,220 128,855 0 75,000 0
Maarten Reidel
Chief Financial Officer 50,000
1998 287,799 105,000 0 0
1997 224,790 105,000 0 120,000 0
1996 179,104 71,586 0 0 0
Dr. Ron Aurell 1998 68,224 (1) 0 0 0
Managing Director 1997 69,280 109,159 0 0 0
of Pulp Operations 1996 79,601 258,092 0 0 0
(1) At the date hereof, Dr. Aurell's bonus for 1998 has not been determined.
</TABLE>
Employment Agreement
Mr. Lee has entered into an employment agreement with the Company dated
July 1, 1994. The agreement generally provides, subject to certain termination
provisions, for continued employment of Mr. Lee for a period of 36 months with
automatic one month renewals, so that the contract at all times has a remaining
term of 36 months. The agreement provides for a base salary and other
compensation as determined by the board of directors. The agreement contains
change in control provisions pursuant to which, if a change in control (as
defined in the agreement) occurs, Mr. Lee may only be discharged for cause. In
the event Mr. Lee is terminated without cause or resigns for good reason (as
defined in the agreement) within eighteen months of the change in control, he
shall be entitled to a severance payment of three times his annual salary under
the agreement and all unvested rights in any stock option or other benefit plans
shall vest in full. If Mr. Lee is terminated without cause or resigns for good
reason after eighteen months of the change in control, he shall be entitled to a
severance payment of a proportionate amount based on the length of time
remaining in the term of the agreement of three times his annual salary under
the agreement and all unvested rights in any stock option or other benefit plans
shall vest in full. In addition, Mr. Lee will continue to receive equivalent
benefits as were provided at the date of termination for the remaining term of
the agreement.
Stock Options
The following table sets forth information concerning the award of
stock options to the Named Executive Officers during fiscal 1998
<TABLE>
<CAPTION>
Option/SAR Grants in Last Fiscal Year
Number of % of Total Potential Realizable
Securities Options/SARs Value at Assumed
Underlying Granted to Annual Rates of Stock
Options/SARs Employees Fiscal Exercise or Base Expiration Price Appreciation for
Name Granted (#) Year Price ($/Sh) Date Option Term
5% ($) 10%($)
<S> <C> <C> <C> <C> <C>
Jimmy S.H. Lee 90,000 27.3% $6.00 10/08 339,603 860,620
Maarten Reidel 50,000 15.2% $6.00 10/08 188,668 478,122
</TABLE>
The table below provides information on exercises of options during
1998 by the Named Executive Officers and information with respect to unexercised
options held by the Named Executive Officers at December 31, 1998
Aggregated Option/SAR Exercises in Last Fiscal Year and
Fiscal Year-End Option/SAR Values
<TABLE>
<CAPTION>
Number of Securities
Underlying Value of Unexercised
Unexercised in-the-money
Options/SARs at Options/SARs at
Fiscal Year-End (#) Fiscal Year-End ($)
Shares Acquired on Exercisable/ Exercisable/
Name Exercise (#) Value Realized ($) Unexercisable Unexercisable
---- ------------ ------------------ ------------- -------------
<S> <C> <C> <C> <C>
Jimmy S.H. Lee 0 0 158,333/166,667 24,300/48,600
Maarten Reidel 120,000 176,250 71,667/33,333 13,500/27,000
Dr. R. Aurell 0 0 10,000/0 0/0
</TABLE>
Compensation of Trustees
The Trustees do not receive cash compensation for service as a Trustee.
The Company reimburses the Trustees and officers for their expenses incurred in
connection with their duties as Trustees and officers of the Company.
Non-employee Trustees who are in office at the end of a fiscal year receive
options to acquire 6,000 shares of common stock at an exercise price equal to
the closing price of the Company's shares on The Nasdaq Stock Market's National
Market on the last trading day of the fiscal year.
Report of the Trustees on Executive Compensation
Compensation of the Company's executive officers is determined on an
annual basis by either the Trustees as a whole or the Compensation Committee in
consultation with management. For 1998, compensation of executive officers was
determined by the Trustees as a whole. The Company's goal is to compensate the
Company's executive officers in a manner which is consistent with the Company's
strategic plan and which rewards executive officers in a fair manner for
performance which forwards the strategic plan. To this end, the Company's basic
compensation philosophy is to maintain annual base salaries for executive
officers at relatively low amounts and to award bonuses and long-term incentives
in the form of stock options based on annual performance of the Company and of
the executive.
The financial results from operating the Company's businesses are the
major factor in determining levels of executive compensation.
The Company adopted an Employee Incentive Plan ("EIP") during 1994 in
which the Company's executive officers and other employees may participate.
Under the EIP, 5% of the Company's Net Income for each fiscal year is set aside
as a bonus pool. During the course of the fiscal year, the Trustees may grant
interests in the bonus pool to employees, officers and trustees of the Company
and its subsidiaries. Bonuses are to be paid within 120 days of the end of the
fiscal year.
In evaluating the performance of the Company's executive officers in
awarding grants under the EIP, the Trustees considered factors such as the
growth in earnings of the Company, the effectiveness of cost reduction and
productivity-enhancement measures in the operating subsidiaries, the growth in
assets, and the performance of the Company's Common Stock. The Trustees also
considered the contribution of the Company's executive officers toward the
accomplishment of those goals.
In determining the compensation of the Company's Chief Executive
Officer, Mr. Lee, for 1998, the Trustees evaluated Mr. Lee based on the criteria
set forth above. In determining Mr. Lee's salary and his bonus award under the
EIP, the Trustees considered the operating performance of the Company in a
difficult economic environment for pulp and paper companies, the progress made
by the Company in transitioning its pulp production from sulphite pulp to kraft
pulp and the completion of the sales of two of the Company's paper mills in
furtherance of the Company's strategic plan to rationalize its production
facilities. Mr. Lee was granted options to purchase 90,000 shares of the
Company's common stock in order to provide a long term incentive.
/s/ Michel Arnulphy /s/ Jimmy S. H. Lee /s/ C. S. Moon /s/ Maarten Reidel
<PAGE>
Performance Graph
The following graph compares the cumulative total stockholder return
(stock price appreciation plus dividends) on the Company's Common Stock with the
cumulative total return of NASDAQ Market Index and an additional group of peer
companies which comprise Standard Industrial Classification Code 262--Paper
Mills for comparison over the five years ending December 31, 1998. The companies
which comprise SIC Code 262 are Abitibi-Consolidated Inc.; American Israeli
Paper; Avenour Inc.; Badger Paper Mills Inc.; Boise Cascade Corporation; Bowater
Inc.; Champion International; Chesapeake Corporation; Consolidated Papers Inc.;
Crown Vantage Inc.; Domtar Inc.; Fletcher Challenger Forests; Fletcher
Challenger Building; Fletcher Challenger Paper; Fort James Corp.; Johns Manville
Corporation; Kimberly-Clark Corporation; MacMillan Bloedel Ltd.; Mercer
International Inc. SBI; P.H. Glatelter Co.; Pope & Talbot Inc.; Potlatch
Corporation; Schweitzer Mauduit International; Striker Industries Inc.; Union
Camp Corporation; Wausau-Mosinee Paper Corporation; Westvaco Corporation;
Weyerhauser Company; and Willamette Industries.
Comparison of Cumulative Total Return
of Company Industry Index and Broad Market
<TABLE>
<CAPTION>
FISCAL YEAR ENDED
COMPANY 1994 1995 1996 1997 1998
------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Mercer International Inc. SBI 96.46 145.13 72.57 62.56 48.56
Industry Index 102.01 134.41 150.44 155.60 162.33
Broad Market 104.99 136.18 169.23 207.00 291.96
</TABLE>
<PAGE>
Certain Transactions
At December 31, 1998, Mr. Reidel had outstanding amounts payable to the
Company of $161,000. This amount is due on demand and does not bear interest.
The Company reimburses a Hong Kong company controlled by the family of
Mr. Lee for the use of office space and general and administrative expenses for
activities of the Company's Hong Kong subsidiary. During 1998, the Company
became obligated to reimburse this company a total of $207,000.
Section 16(a) Beneficial Ownership Compliance
Section 16(a) of the Securities and Exchange Act of 1934, as amended
(the "Exchange Act") requires that the Company's officers and directors, and
persons who own more than 10% of a registered class of the Company's equity
securities, file reports of ownership and changes of ownership with the
Securities and Exchange Commission (the "SEC"). Officers, directors and greater
than 10% shareholders are required by SEC regulation to furnish the Company with
copies of all such reports they file.
Based solely on the review of the copies of such reports received by
the Company, and on written representations by the Company's officers and
Trustees regarding their compliance with the applicable reporting requirements
under Section 16(a) of the Exchange Act, the Company believes that, with respect
to its fiscal year ended December 31, 1998, all of its officers and Trustees
filed all required reports under Section 16(a) in a timely manner.
PROPOSAL 2: INCREASE IN SHARES AVAILABLE FOR ISSUANCE UNDER STOCK OPTION PLAN
In 1992, the Board of Directors of the Company adopted the Mercer
International, Inc. 1992 Non-Qualified Stock Option Plan (the "Stock Plan"). A
copy of the Stock Plan may be obtained upon written request to the Company's
secretary. The Stock Plan was approved by shareholders at the annual meeting in
1993. Under the Stock Plan, the Company is authorized to issue 2,000,000 shares
of Mercer common stock upon the exercise of options granted under the Stock
Plan. The shareholders are being requested to approve an amendment to the Stock
Plan that increases the number of shares that may be issued under the Stock Plan
from 2,000,000 to 3,600,000.
The purpose of the Stock Plan is to enable the Company to attract and
retain employees of ability and experience, and to furnish such personnel
significant incentives to improve operations and increase profits of the
Company. Since its inception, options with respect to 1,164,500 shares have been
exercised and 765,000 options are currently outstanding and exercisable.
Currently, there are no shares available for future option grants to employees
and fewer than 70,000 shares available for future option grants to Trustees. The
Board believes that the number of shares remaining available for issuance will
be insufficient to achieve the purpose of the Stock Plan over the term of the
Plan (which expires, unless earlier terminated, in 2002) unless additional
shares are authorized. The amount of the proposed increase, 1,600,000 shares,
represents approximately 10.0% of the Company's outstanding shares.
In general, the Stock Plan currently authorizes Mercer to grant
non-qualified stock options. The Stock Plan is administered by the Compensation
Committee and all terms of the grant are determined by the Compensation
Committee. The purchase price of each share of Mercer common stock covered by an
option may not be less than 100% of the fair market value of Mercer common
stock, on the date of grant of the option. Options may be exercised only while
the holder is in the employ of the Company or a subsidiary within 90 days after
the date of termination or within one year after the death or disability of the
holder.
Approval of an amendment to the Stock Plan as described above requires
the affirmative vote of a majority of the outstanding shares of common stock
eligible to vote as the meeting. THE TRUSTEES RECOMMEND A VOTE FOR ADOPTION OF
THIS PROPOSAL.
INDEPENDENT ACCOUNTANTS AND AUDITORS
Peterson Sullivan P.L.L.C., Certified Public Accountants, has been selected
by the Trustees to examine the consolidated financial statements of the Company
and its subsidiaries for the fiscal year ending December 31, 1999. Peterson
Sullivan P.L.L.C. have examined the consolidated financial statements of the
Company and its subsidiaries each year since 1989. Representatives of Peterson
Sullivan P.L.L.C. are not expected to be present at the Annual Meeting.
FUTURE SHAREHOLDER PROPOSALS
Any proposal which a Shareholder intends to present at the next Annual
Meeting of Shareholders must be received by the Company on or before February 2,
2000. A shareholder must notify the Company on or before April 17, 2000 that he
or she intends to introduce a proposal at the 2000 shareholder meeting or
management will have discretionary authority to vote its proxies with respect to
any such proposal.
OTHER MATTERS
The Trustees know of no matter other than those mentioned in the Proxy
Statement to be brought before the meeting. If other matters properly come
before the meeting, it is the intention of the Proxy holders to vote the Proxies
in accordance with their judgment. If there are insufficient votes to approve
any of the proposals contained herein, the Trustees may adjourn the meeting to a
later date and solicit additional Proxies. If a vote is required to approve such
adjournment, the Proxies will be voted in favor of such adjournment.
A copy of the Company's Annual Report to the Securities and Exchange
Commission will be provided to Shareholders without charge upon written request
directed to Mercer Shareholders Information, Burglistrasse 6, 8002 Zurich,
Switzerland.
By Order of the Trustees,
DATE: June 1, 1999.
<PAGE>
PROXY
MERCER INTERNATIONAL INC.
Burglistrasse 6
8002 Zurich
Switzerland
This Proxy is solicited on behalf of the Trustees of Mercer
International Inc.
The undersigned hereby appoints Jimmy S.H. Lee as proxy, with the power
of substitution to represent and to vote as designated below, all the shares of
beneficial interest of Mercer International Inc. held of record by the
undersigned on May 21, 1999, at the Annual Meeting of Shareholders to be held on
July 13, 1999, or any adjournment thereof.
1. ELECTION OF TRUSTEES
FOR the nominees listed WITHHOLD AUTHORITY to vote
below (except as marked for the nominees listed
to the contrary below) |_| below |_|
(Instruction: To withhold authority to vote for a nominee, strike a line
through the nominee's name in the list below.)
Jimmy S. H. Lee R. Ian Rigg
2. Amendment of the Company's Non-qualified Stock Option Plan to
increase the number of shares available for issuance from 2,000,000 shares to
3,600,000 shares.
3. In his discretion, the Proxy holder is authorized to vote upon such
other business as may properly come before the meeting.
This Proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this Proxy will
be voted FOR Proposals 1 and 2.
Please sign exactly as name appears on your share certificates. When
shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If
a corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
DATED: , 1999
Signature
Print Name
Signature, if jointly held
Print Name
Please mark, sign, date and return this Proxy promptly using the enclosed
envelope.
- --------
1 Filed jointly with Edward C. Johnson 3d and Abigail P. Johnson.
2 Filed on behalf of Merrill Lynch Asset Management Group, together Merrill
Lynch Special Value Fund, Inc. ("MLF"). MLF claims shared voting and dispositive
power with respect to 1,609,000 shares.
3 Sole voting power as to 1,360,146 Shares and sole dispositive power as to
1,477,401 Shares.
