<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
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 [ ] Soliciting Material Pursuant to
[ ] Confidential, For Use of the SS.240.14a-11(c) or SS.240.14a-12
Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
WASTE TECHNOLOGY CORP.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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 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, 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:
________________________________________________________________________________
SEC 1913 (3-99)
<PAGE>
WASTE TECHNOLOGY CORP.
5400 RIO GRANDE AVENUE
JACKSONVILLE, FLORIDA 32254
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
July 21, 2000
TO THE STOCKHOLDERS:
Notice is hereby given that the annual meeting of stockholders (the
"Annual Meeting") of Waste Technology Corp. (the "Company") has been called for
and will be held at 10:00 A.M., local time, on Friday, July 21, 2000, at the
offices of the Company, 5400 Rio Grande Avenue, Jacksonville, Florida 32254 for
the following purposes:
1. To elect two (2) Class II Directors, Ted C. Flood and Morton S.
Robson, to the Board of Directors to hold office for three (3) years and until
their successors shall have been elected and qualify;
2. To ratify the appointment by the Board of Directors of KPMG LLP, to
serve as the independent certified public accountants for the current fiscal
year; and
3. To consider and transact such other business as may properly come
before the Annual Meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on May 22, 2000
as the record date for the determination of the stockholders entitled to notice
of, and to vote at, the Annual Meeting or any adjournments thereof. The list of
stockholders entitled to vote at the Annual Meeting will be available for
examination by any stockholder at the Company's offices at 5400 Rio Grande
Avenue, Jacksonville, Florida 32254, for ten (10) days prior to July 21, 2000.
By Order of the Board of Directors
Ted C. Flood, President
Dated: June 16, 2000
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE FILL IN, SIGN,
AND DATE THE PROXY SUBMITTED HEREWITH AND RETURN IT IN THE ENCLOSED STAMPED
ENVELOPE. THE GRANTING OF SUCH PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE SUCH
PROXY IN PERSON SHOULD YOU LATER DECIDE TO ATTEND THE MEETING. THE ENCLOSED
PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS.
<PAGE>
WASTE TECHNOLOGY CORP.
PROXY STATEMENT
GENERAL
This proxy statement is furnished by the Board of Directors of Waste
Technology Corp., a Delaware corporation (sometimes the "Company" or "Waste
Tech"), with offices located at 5400 Rio Grande Avenue, Jacksonville, Florida
32254, in connection with the solicitation of proxies to be used at the annual
meeting of stockholders of the Company to be held on July 21, 2000 and at any
adjournments thereof (the "Annual Meeting"). This proxy statement will be mailed
to stockholders beginning approximately June 22, 2000. If a proxy in the
accompanying form is properly executed and returned, the shares represented
thereby will be voted as instructed on the proxy. Any proxy may be revoked by a
stockholder prior to its exercise upon written notice to the President of the
Company, or by a stockholder voting in person at the Annual Meeting.
All properly executed proxies received prior to the Annual Meeting will
be voted at the Annual Meeting in accordance with the instructions marked
thereon or otherwise as provided therein. Unless instructions to the contrary
are indicated, proxies will be voted FOR the election of the two (2) Class II
Directors named therein and FOR the ratification of the selection by the Board
of Directors of KPMG LLP, as the independent certified public accountants of the
Company.
A copy of the annual report of the Company for the fiscal year ended
October 31, 1999 ("Fiscal 1999"), which contains financial statements audited by
the Company's independent certified public accountants, accompanies this proxy
statement.
The cost of preparing, assembling and mailing this notice of meeting,
proxy statement, the enclosed annual report and proxy will be borne by the
Company. In addition to solicitation of the proxies by use of the mails, some of
the officers and regular employees of the Company, without extra remuneration,
may solicit proxies personally or by telephone, telegraph, or cable. The Company
may also request brokerage houses, nominees, custodians and fiduciaries to
forward soliciting material to the beneficial owners of the Common Stock. The
Company will reimburse such persons for their expenses in forwarding soliciting
material.
VOTING SECURITIES AND
PRINCIPAL HOLDERS THEREOF
The Board of Directors has fixed the close of business on May 22, 2000
as the record date (the "Record Date") for the determination of stockholders
entitled to notice
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of, and to vote at the Annual Meeting. Only stockholders on the Record Date will
be able to vote at the Annual Meeting.
As of the Record Date, 5,516,349 shares of the Company's common stock,
$.01 par value per share ("Common Stock") are outstanding, and each share will
be entitled to one (1) vote, with no shares having cumulative voting rights.
Holders of shares of Common Stock are entitled to vote on all matters. Unless
otherwise indicated herein, a majority of the votes represented by shares
present or represented at the Annual Meeting is required for approval of each
matter which will be submitted to stockholders. The Company also has 10,000,000
shares of Preferred Stock, $.0001 par value per share authorized, none of which
are outstanding.
Management knows of no business other than that specified in Items 1
and 2 of the Notice of Annual Meeting which will be presented for consideration
at the Annual Meeting. If any other matter is properly presented, it is the
intention of the persons named in the enclosed proxy to vote in accordance with
their best judgment.
The following tables set forth certain information with respect to the
ownership of the Company's Common Stock as of the Record Date, May 22, 2000, by
those persons known by the Company to be the beneficial owners of more than 5%
of the total number of outstanding shares of Common Stock:
Five Percent Stockholders
-------------------------
Amount of
Name and Address of Beneficial Approximate
Beneficial Owner Ownership(1) Percent of Class
Ted C. Flood 1,069,778(2) 19.4%
5400 Rio Grande Avenue
Jacksonville, Fla. 32254
--------
(1) Unless otherwise stated, all shares of Common Stock are directly
held with sole voting and dispositive power. The shares set forth in the table
reflect the 2:1 stock split of the Company's common stock effective as of May
15, 1997.
(2) Consists of 640,572 shares held directly and, 429,206 shares owned
by the Waste Technology Corp. Employees Profit Sharing Trust of which Messrs.
Flood and Robson are Trustees.
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Morton S. Robson 586,854(1) 10.6%
530 Fifth Avenue
New York, N.Y. 10036
Robert Roth 318,638(2) 5.8%
Georgetown Electric, Ltd.
Unit 17, 2501 W. Third Street
Wilmington De., 19805
Cosimo Tacopino 509,639(3) 9.2%
145 Connecticut Street
Staten Island, New York 10307
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
General
The Board of Directors is divided into three (3) classes of directors
("Class I", "Class II", and "Class III"), with each class having as nearly the
same number of directors as practicable. Stockholders elect such class of
directors, Class I, Class II, or
--------
(1) Consists of 78,454 shares held directly; 2,400 shares held as
custodian for his minor son; 505,000 shares held by Robson & Miller, of which
Mr. Robson is the senior partner; and 1,000 shares held by the Robson & Miller
pension plan. Excludes 89,726 shares held by Kenneth N. Miller, a partner of Mr.
Robson who is the beneficial and record owner of such shares. Does not include
the 429,206 shares owned by the Waste Technology Corp Employees Profit Sharing
Trust of which Messrs. Flood and Robson are trustees since these shares are
included in Mr. Flood's holdings and their inclusion here would be duplicative.
(2) Consists of 3,300 shares held directly; 114, 182 shares held by his
wife, Patricia B. Roth; 83,968 shares held by his son, Steven F. Roth; 10,000
shares held by his daughter; and, 107188 shares held by his son, Charles B. Roth
and his wife Marta Roth.
(3) Consists of 10,000 shares held directly; 455,864 shares owned
jointly with his wife, Erma Tacopino; and, 43,775 shares held directly by Erma
Tacopino of which 11,000 are held in an individual retirement account.
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Class III, as the case may be, to succeed such class directors whose terms are
expiring, for a three (3) year term, and such class of directors shall serve
until the successors are elected and qualify. The term of each of the two Class
I Directors was to have expired at the Company's 1998 Annual Stockholder's
meeting which was to be held in 1999. However, the Company did not have an
Annual Meeting for 1998. In Fiscal 1999 both Class I Directors, Charles C.
Wildes and Alan Morrison , resigned. Mr. Wildes resigned when he, along with
other individuals, purchased the assets of the Company's wholly owned
subsidiary, International Press and Shear Corporation. Mr. Morrison resigned for
personal reasons. As a result, there is presently a vacancy as to both Class I
Directors. The Company is not nominating anyone at this time to fill those
vacancies.
The terms of both Class II Directors, Ted C. Flood and Morton S. Robson
expire at this year's 1999 Annual Meeting. As a result, the election of two
Class II Directors will be held at this year's 1999 Annual Meeting of
Stockholders. The term of the two Class III Directors will expire at the 2000
Annual Meeting of Stockholders to be held in 2001.
The following is the apportionment of existing directors into classes:
No. of Class Term Expires Members/Nominees
Class I 1998 Annual Vacant
Stockholder's Meeting Vacant
Class II 1999 Annual Morton S. Robson
Stockholder's Meeting Ted C. Flood
(to be held in 2000)
Class III 2000 Annual Robert Roth
Stockholder's Meeting William E. Nielsen
(To be held in 2001)
The Board of Directors presently consists of four (4) persons. There
are two (2) nominees for Class II members of the Board, Ted C. Flood and Morton
S. Robson. Unless authority is withheld, the proxies in the accompanying form
will be voted in favor of the election of Messrs. Flood and Robson as nominees
for Class II Directors at the Annual Meeting. If the nominees should
subsequently become unavailable for election, the persons voting the
accompanying proxy may in their discretion vote for a substitute.
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The Class III directors were each elected at the 1997 annual meeting of
stockholders held in 1998. With the exception of Ted C. Flood, the officers are
elected annually by the directors and serve at the discretion of the board of
directors. See "Executive Compensation- Employment Agreements". There are no
family relationships between executive officers or directors of the Company.
However, Robert Roth is the husband of Patricia B. Roth and the father of Steven
F. Roth and Charles B. Roth, major shareholders of the Company. See "Certain
Transactions".
Board of Directors
The Board of Directors has the responsibility for establishing broad
corporate policies and for the overall performance of the Company. Although only
two (2) members of the Board are involved in day-to-day operating details, the
other members of the Board are kept informed of the Company's business by
various reports and documents sent to them as well as by operating and financial
reports made at Board meetings. The Board of Directors held two meetings in
Fiscal 1999.
During Fiscal 1999 Messrs. Robson and Roth and were the members of the
Company's audit and compensation committees. In Fiscal 1999 the compensation
committee and the audit committee did not hold any formal meetings.
Management has agreed to use its best efforts to have Robert Roth
elected as a director for so long as Patricia Roth and Steven Roth, his family
members, own more than one (1%) percent of the outstanding shares of Common
Stock. See "Certain Transactions- Related Party Transactions - Robert Roth".
Other than with regard to Mr. Roth, there is no understanding or arrangement
between any director or any other persons pursuant to which such individual was
or is to be selected as a director or nominee of the Company.
The following tables set forth certain information with respect to the ownership
of the Company's Common Stock as of the Record Date, May 22, 2000, of the
executive officers and directors of the Company and the directors and officers
of the Company as a group:
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Directors and Officers
Amount of
Name and Address of Beneficial Approximate
Beneficial Owner Ownership(1) Percent of Class
Ted C. Flood 1,069,778(2) 19.4%
5400 Rio Grande Avenue
Jacksonville, Fla. 32254
Morton S. Robson 586,854(3) 10.6%
530 Fifth Avenue
New York, N.Y. 10036
Robert Roth 318,638(4) 5.8%
Georgetown Electric, Ltd.
Unit 17, 2501 W. Third Street
Wilmington De., 19805
William E. Nielsen 263,006(5) 4.7%
5400 Rio Grande Avenue
Jacksonville, Fla. 32254
All Officers and
Directors as a Group 2,238,276 40%
--------
(1) Unless otherwise stated, all shares of Common Stock are directly
held with sole voting and dispositive power. The shares set forth in the table
reflect the 2:1 stock split of the Company's common stock effective as of May
15, 1997.
(2) Consists of 640,572 shares held directly and, 429,206 shares owned
by the Waste Technology Corp. Employees Profit Sharing Trust of which Messrs.
Flood and Robson are Trustees.
(3) Consists of 78,454 shares held directly; 2,400 shares held as
custodian for his minor son; 505,000 shares held by Robson & Miller, of which
Mr. Robson is the senior partner; and 1,000 shares held by the Robson & Miller
pension plan. Excludes 89,726 shares held by Kenneth N. Miller, a partner of Mr.
Robson who is the beneficial and record owner of such shares. Does not include
the 429,206 shares owned by the Waste Technology Corp Employees Profit Sharing
Trust of which Messrs. Flood and Robson are trustees since these shares are
included in Mr. Flood's holdings and their inclusion here would be duplicative.
(4) Consists of 3,300 shares held directly; 114, 182 shares held by his
wife, Patricia B. Roth; 83,968 shares held by his son, Steven F. Roth; 10,000
shares held by his daughter; and, 107188 shares held by his son Charles B. Roth
and his wife Marta Roth.
(5) Consists of 213,006 shares held directly and options to purchase
50,000 shares.
7
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Background of Executive Officers and Directors
The following is a brief account of the experience, during the past
five years, of each director and executive officer of the Company:
Ted C. Flood, age 69, was elected as the President and Chief Executive
Officer of the Company on February 23, 1993. He is also the President and Chief
Executive Officer of the Company's wholly owned subsidiaries, International
Baler Corporation ("IBC"), Consolidated Baling Machine Co., Inc. and Solid Waste
& Recovery Systems, Inc. He was elected as a Director of the Company in May,
1989. From 1960 to 1972 he was president of Peabody Solid Waste Management
Company (EZ Pack). From 1972 to 1975 Mr. Flood was a corporate vice-president of
marketing for Browning Ferris Industries. During the period from 1977 to 1988 he
was the principal shareholder and president of Solid Waste & Recovery Systems,
Inc.
Morton S. Robson, age 77, was elected a Director and the Secretary of
the Company in 1989. On February 23, 1993, he was elected Executive Vice
President of the Company. Mr. Robson is the senior partner of the law firm of
Robson Ferber Frost Chan & Essner, LLP, which acts as general counsel to the
Company. Mr. Robson obtained an LLB degree from St. John's University School of
Law.
Robert Roth, age 74, is the Chairman of the Board and Treasurer of
Georgetowne Electric, Ltd., and a director of Keystone Insurance Co., both
publicly held companies. For more than the past five (5) years, in addition to
being the Chairman of the Board and Treasurer of Georgetowne Electric, Ltd., he
has also been the President and Chief Executive Officer of Browning Weldon
Corp., a privately held financial company.
William E. Nielsen, age 52, joined the Company in June 1994 as its
Chief Financial Officer. Prior to joining the Company, Mr. Nielsen acted as a
financial consultant to Fletcher Barnum Inc., a privately held manufacturing
concern, from October 1993 through June 1994. From 1980 through July 1993 he was
the Vice President, Administration and Finance at Unison Industries, Inc. Mr.
Nielsen received a B.B.A in Finance and an M.B.A. at Western Illinois University
in 1969 and 1970, respectively.
Executive Compensation
The following table sets forth a summary of all compensation awarded to, earned
by or paid to, the Company's Chief Executive Officer and each of the Company's
executive officers whose compensation exceeded $100,000 per annum for services
rendered in all
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capacities to the Company and its subsidiaries during fiscal years ended
October 31, 1999, October 31, 1998 and October 31, 1997(1):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term Awards
------------------- ----------------
Name and Year Salary Bonus Other Annual Number All Other
Principal Position ($) ($) Compensation of Compensation
($) Options
<S> <C> <C> <C> <C> <C> <C>
Ted C. Flood, 1999 157,866(2) -0- -0- -0- -0-
Chief Executive Officer
and President of 1998 186,854(3) -0- -0- -0- -0-
Company and IBC
1997 180,750(4) -0- -0- -0- -0-
</TABLE>
--------
(1) The law firm of Robson & Miller, LLP and its predecessor firms have
provided legal services for the Company. Effective July 1, 1999, Robson & Miller
merged its practice with the firm of Ferber Chan & Essner, LLP. The new firm is
known as Robson Ferber Frost Chan & Essner, LLP (hereinafter collectively
referred to as the "Robson Firms") Morton S. Robson, the Executive Vice
President and Secretary and a Director of the Company, is the senior partner of
Robson Ferber Frost Chan & Essner, LLP. During Fiscal 1999, the Company paid the
Robson Firms the sum of $56,021 for legal services rendered. As of the end of
Fiscal 1999 accrued but unpaid legal fees and accrued interest due to the Robson
Firms from the Company amounted to $416,995. In June, 1995, Robson & Miller, Mr.
Robson's firm at that time, exercised an option to purchase 250,000 shares of
Common Stock at $1.00 per share. See "Certain Relationships and Related Party
Transactions".
(2) Ted C. Flood, President of the Company and President of the
Company's subsidiaries received $133,608 in compensation from IBC during the
fiscal year ended October 31, 1999 and $24,258 from Consolidated during that
period.
(3) Ted C. Flood, President of the Company and President of the
Company's subsidiaries received $160,730 in compensation from IBC during the
fiscal year ended October 31, 1998 and $26,124 from Consolidated during that
period.
(4) Ted C. Flood, President of the Company and President of the
Company's subsidiaries received $156,500 in compensation from IBC and IPS during
the fiscal year ended October 31, 1997 and $24,250 from Consolidated during that
period.
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The following table sets forth certain information relating to stock
option grants during Fiscal 1997 to the Company's Chief Executive Officer and
each of the Company's most highly compensated executive officers whose
compensation exceeded $100,000 for Fiscal 1999:
OPTION GRANTS IN LAST FISCAL YEAR
Individualized Grants
<TABLE>
<CAPTION>
Name Number of Securities Percent of Total Exercise or Expiration
Underlying Options/SARs Base Price Date
Options/SARs Granted to ($/Sh)
Granted (#) Employees in Fiscal
1999
<S> <C> <C> <C> <C>
Ted C. Flood(1) -0- NA NA NA
</TABLE>
No options were exercised during Fiscal 1999 by the Company's Chief
Executive Officer or any of the Company's most highly compensated executive
officers whose compensation exceeded $100,000 for Fiscal 1997.
Employment and Severance Agreements
On September 15, 1996, Ted C. Flood, the President and Chief Executive
officer of the Company entered into an employment agreement with the Company.
The agreement is for a term of five years commencing on October 1, 1996 and
terminating on September 30, 2001. The agreement provides that Mr. Flood is to
receive compensation of $150,034 for the first year with increases of 5% per
annum during the term of the agreement. However, in the event the Company is not
profitable in any year, the Company's Board of Directors has the right to defer
the 5% increase earned during that year. Such increase in income that is
deferred shall be carried forward and paid in the next profitable fiscal year at
the end of such fiscal year in a lump sum payment. The agreement further
provides that in the event of a merger, consolidation, sale of substantially all
of the Company's assets, or a sale of either a majority or plurality of the
Company's stock, Mr. Flood shall have the option to allow the agreement to
remain a binding obligation of the Company or the surviving or successor
--------
(1) In September 1988 Mr. Flood was granted an option to purchase
200,000 shares of IBC stock. This option was to expire on September 21, 1998. As
a result of the IBC merger, this option was converted to an option to purchase
48,622 shares of the Company's stock at a price of $.6165 per shares. The
conversion was calculated based upon the conversion rate of IBC shares for the
Company's shares as set forth in the Merger Agreement.
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corporation or at such time of such event receive the balance due him under the
agreement.
On June 3, 1989, IBC entered into a severance agreement with Ted C.
Flood, its President. The severance agreement provides, among other things,
that, in the event of a change in control of IBC as that term is defined in the
agreement, and the subsequent termination of Mr. Flood's employment by IBC other
than for cause or by Mr. Flood for good reason, (as such terms are defined in
the agreement), IBC shall pay to Mr. Flood, in addition to his salary at the
date of termination, a lump-sum severance payment equal to 2.99 times the
greater of his annual salary rate in effect as of the date of termination or
such rate in effect immediately prior to the change in control, together with
compensation for other benefits to which he would have been entitled.
The initial term of the severance agreement was from May 3, 1989
through April 30, 1991. It was, and thereafter it shall be, automatically
extended for one year periods, unless IBC shall give written notice of
termination, at least one year prior to the termination date, of its desire not
to extend the agreement. In the event of a change in control of the Company,
however, the severance agreement shall continue in effect for not less than 24
months after such change in control.
Certain Transactions
Related Party Transactions
Loans to Officers and Directors
The Company and IBC entered into an agreement with Mr. Flood
dated as of December 29, 1995 pursuant to which IBC assigned all of its interest
in a life insurance policy in the face amount of $1,000,000 it owned on Mr.
Flood's life to Mr. Flood. In consideration for this assignment Mr. Flood agreed
to pay IBC the sum of $145,727 which amount represented the cash surrender value
of the policy as of the date of the agreement. This amount is to be paid out of
the proceeds Mr. Flood or his Estate receives upon surrender of the policy or
from the living proceeds or death benefit proceeds from the policy, whichever
occurs first. Interest on Mr. Flood's obligation accrues at the rate of 6% per
annum from the date of the agreement to the date of payment. The agreement
further provides that no payment of principal or interest of this obligation
shall be required to be made until such time that Mr. Flood or his Estate shall
receive the proceeds from the policy. This obligation of Mr. Flood to IBC is
evidenced by a promissory note executed by Mr. Flood to the order of IBC.
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The agreement further provides that all premiums due on the policy
after ownership has been transferred from IBC to Mr. Flood shall be advanced by
the Company. Each time that such advance is made for a premium by the Company,
Mr. Flood shall execute a promissory note to the order of the Company in the
amount of such premium advanced. Such note shall accrue interest at the rate of
six per cent per annum and no payment of principal or interest of such notes
shall be required to be made until such time that Mr. Flood or his Estate shall
receive the proceeds from the policy, either upon the surrender of the policy or
from the living proceeds or death benefit proceeds, whichever occurs first. As
of this date, the Company has advanced funds to pay eight premiums on the policy
each in the amount of $20,000. Mr. Flood has executed eight promissory notes,
each in the amount of $20,000, to the order of the Company evidencing his
obligation to repay these loans to the Company.
As of this date, Morton S. Robson, the Company's Executive Vice
President and Secretary and a Director and corporate counsel, was indebted to
the Company. The transaction giving rise to the obligations owed to the Company
by Mr. Robson is described below.
On April 12, 1990, four individuals, including Leslie N. Erber, then
Chairman of the Board and President of the Company, and Morton S. Robson entered
into an agreement with a group of dissident shareholders to purchase an
aggregate of 294,182 shares at a purchase price of $4.00 per share. Mr. Erber
and Mr. Robson each purchased 134,951 shares of stock. Such number of shares and
purchase price have been adjusted to reflect the one for four (1:4) reverse
stock split effected on November 13, 1991. The dissidents had previously filed
Forms 14B with the Commission indicating their intention of seeking control of
the Company through the solicitation of consents from shareholders to a
reduction in the number of directors and the replacement of the present
directors with directors nominated by the dissident group. As part of the
agreement to purchase the shares, the dissident shareholders who were selling
their shares agreed that, for a period of ten years, they would not seek to
obtain control of the Company or solicit proxies in opposition to the Board of
Directors on any matter.
Messrs. Erber and Robson and the two other persons borrowed the
aggregate amount of $1,244,328 from the Company in 1990 and 1991 to purchase
these shares. Most of the loan (91.5%) was made in equal amounts to Mr. Erber
and Mr. Robson. Those advances were secured by a lien on the 294,182 shares of
Common Stock. In addition, Mr. Erber agreed to transfer to the Company as
additional collateral, 156,000 shares of stock of the Company. Approximately
one-half of this sum was advanced on April 12, 1990 and the balance during 1991.
In April 1990, promissory notes evidencing the first half of the funds were
executed by these persons bearing interest at the rate of 9% per annum and
payable in three annual installments commencing on April 12, 1991. Thereafter,
independent members of the Company's Board of Directors
12
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unanimously extended the payment due date of each payment for one (1) year. New
promissory notes to the Company were thereafter executed for the full amount of
the advance, payable in three annual installments commencing April 12, 1992. The
notes were secured by a lien on all of these shares which were acquired. In June
1992, $200,000 of the principal amount of these loans was repaid to the Company
through a sale of 100,000 of the acquired shares at $2.00 per share. Payment of
the remainder of the principal due in 1993 and 1994, together with the accrued
interest, was subsequently deferred for two years by the Company's Board of
Directors, and deferred again until 2000.
Thereafter, Mr. Erber, in connection with his termination as President
of the Company, turned in all of his stock in to the Company and IBC in full
satisfaction of his obligation of $698,527.
In June 1995, Robson & Miller, Mr. Robson's firm at that time,
exercised a stock option to purchase 250,000 shares of Common Stock at $1.00 per
share, by offsetting $250,000 of the fees that were due and owing to it from the
Company. As of the end of fiscal 1999, the Company owed Mr. Robson's law firm
the sum of $416,995 for legal fees and accrued interest. The Company has
acquired a security interest in the shares acquired by Robson & Miller by the
exercise of the aforesaid option as collateral security for repayment of the
outstanding loan of Mr. Robson. As of October 31, 1999 Mr. Robson still owed the
Company $427,364 together with accrued interest. The largest aggregate
outstanding loan balance of Mr. Robson during the past two (2) fiscal years was
$796,647.
Related Party Transactions
Legal Services
The law firms in which Morton S. Robson, the Secretary and a Director
of the Company, was and is a partner have provided services to the Company since
1975. During fiscal 1999, Mr. Robson's law firms received $56,021 from the
Company as payment for legal services rendered. As of the end of fiscal 1999
accrued but unpaid legal fees and accrued interest due to Mr. Robson's law firm
from the Company amounted to $416,995.
Conflicts of Interest
Each of Messrs. Flood and Robson are directors of both the Company and
its wholly owned subsidiary, IBC. Conflicts of interest may arise for Messrs.
Flood and
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Robson in transactions between the Company and IBC. Additionally, Mr. Robson is
the senior partner of the law firm which is counsel to the Company. Conflicts of
interests may arise as the result of such relationship.
Robert Roth
Members of the immediate family of Robert Roth, one of the Directors of
the Company and members of his immediate family own an aggregate of 5.7% of the
Company's outstanding and issued stock. The shares of stock are owned by Mr.
Roth (3,300), his wife, Patricia B. Roth (114,182), his son, Steven F. Roth
(83,968), his daughter, Kathie Cecile Roth (10,000) and his son Charles B. Roth
and his wife, Marta Roth (107,188). Pursuant to the terms of an agreement dated
May 11, 1993 between Patricia Roth, Steven Roth and Robert Roth so long as
Patricia Roth and Steven Roth are the owners of more than one percent (1%) of
the number of outstanding shares of Common Stock, the Company has agreed to use
its best efforts to cause the election of Robert Roth as a member of the Board
of Directors.
PROPOSAL NO. 2:
RATIFICATION OF SELECTION OF
KPMG LLP AS INDEPENDENT AUDITORS
The Board of Directors has selected the firm of KPMG LLP, independent
certified public accountants, to audit the accounts for the Company for fiscal
year ending October 31, 2000 ("Fiscal 2000"). The Company is advised that
neither that KPMG LLP nor any of its partners has any material direct or
indirect relationship with the Company. The Board of Directors considers KPMG
LLP to be well qualified for the function of serving as the Company's auditors.
The Delaware General Corporation Law does not require the approval of the
selection of auditors by the Company's stockholders, but in view of the
importance of the financial statement to stockholders, the Board of Directors
deems it desirable that they pass upon its selection of auditors. In the event
the stockholders disapprove of the selection, the Board of Directors will
consider the selection of other auditors. The Board of Directors recommends that
you vote in favor of the above proposal in view of the quality of the
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services provided by KPMG LLP, its outstanding reputation as a leading audit
firm and its familiarity with the Company's financial and other affairs.
A representative of KPMG LLP is expected to be present at the Annual
Meeting with the opportunity to make a statement if he desires to do so, and is
expected to be available to respond to appropriate questions.
Unless otherwise directed by the stockholder giving the proxy, the
proxy will be voted for the ratification of the selection by the Board of
Directors of KPMG LLP as the Company's independent certified public accountants
for Fiscal 2000.
STOCKHOLDERS' PROPOSALS
Proposals of stockholders intended to be presented at the 2000 annual
meeting must be received in writing, by the President of the Company at its
offices by February 1, 2001 in order to be considered for inclusion in the
Company's proxy statement relating to that meeting.
By Order of the Board of Directors
Morton S. Robson, Secretary
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WASTE TECHNOLOGY CORP.
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
The undersigned hereby appoints William E. Nielsen and Robert Roth as
proxies (the "Proxies"), each with power of substitution and resubstitution, to
vote all shares of Common Stock, $.01 par value per share, of Waste Technology
Corp. (the "Company") held of record by the undersigned on May 22, 2000 at the
Annual Meeting of stockholders to be held at the offices of the Company, 5400
Rio Grande Avenue, Jacksonville, Florida 32254, on Friday, July 21, 200 at 10:00
A.M. local time, or at any adjournments thereof, as directed below, and in their
discretion on all other matters coming before the meeting or any adjournments
thereof.
Please mark boxes / / in blue or black ink.
1. Election of two Class II Directors: Ted C. Flood and Morton S. Robson.
(Mark only one of the two boxes for this item)
/ / VOTE FOR all nominees named above except those who may be named
on this line:
-----------------------------------------------------------------------
(OR)
/ / VOTE WITHHELD as to all nominees named above.
2. Proposal to ratify appointment of KPMG LLP as the Company's independent
certified public accountants:
FOR / / AGAINST / / ABSTAIN / /
4. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
When properly executed, this Proxy will be voted as directed. If no
direction is made, this Proxy will be voted "FOR" Proposals 1 and 2.
Please mark, date, sign and return this Proxy promptly in the enclosed
envelope.
<PAGE>
Please sign exactly as name appears hereon. When shares are held by
joint tenants, both should sign. When signing as attorney or 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: _______________________ , 2000
X ____________________________
Signature
X _____________________________
Print Name(s)
X ____________________________
Signature, if held jointly
