SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant / X /
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ X / Preliminary Proxy Statement
/ / Confidential. For Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Ramtron International Corporation
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(Name of Registrant as Specified In Its Charter)
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(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 Rule 14-6(i)(4) and 0-11
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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/ / 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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RAMTRON INTERNATIONAL CORPORATION
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
March 15, 1999
NOTICE IS HEREBY GIVEN that a Special Meeting of the Stockholders (the
"Special Meeting") of Ramtron International Corporation, a Delaware
corporation (the "Company"), will be held on March 15, 1999, at 2:00 p.m.,
Mountain Standard Time, at the principal office of the Company, located at
1850 Ramtron Drive, Colorado Springs, Colorado 80921, for the following
purpose, as more fully described in the attached Proxy Statement:
To approve a series of amendments to the Company's Certificate of
Incorporation, as amended, to effect, at any time prior to January 1, 2000,
a reverse stock split of the Company's Common Stock whereby each 1.5, 2, 2.5,
3, 3.5, 4, 4.5, and 5 shares would be combined, converted and changed into one
share of Common Stock, with the effectiveness of one of such amendments and
the abandonment of the other amendments, or the abandonment of all amendments,
to be determined by the Board of Directors.
Only record holders of Common Stock at the close of business on February 3,
1999 are entitled to notice of, and to vote at, the Special Meeting and at any
adjournment or adjournments thereof.
All stockholders are cordially invited to attend the Special Meeting in
person. Whether or not you expect to attend the Special Meeting in person, in
order to ensure your representation at the Special Meeting, please mark, sign,
date and return the enclosed proxy card as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. Any stockholder attending
the Special Meeting may vote in person even if such stockholder has returned a
proxy.
By Order of the Board of Directors
---------------------------------
Richard L. Mohr
Secretary
Colorado Springs, Colorado
February XX, 1999
<PAGE>
RAMTRON INTERNATIONAL CORPORATION
PROXY STATEMENT
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed proxy is solicited by and on behalf of the Board of Directors
(the "Board") of Ramtron International Corporation, a Delaware corporation
("Ramtron" or the "Company"), for use at the Special Meeting of
Stockholders (the "Special Meeting") to be held on March 15, 1999, at 2:00
p.m., Mountain Standard Time, or at any adjournment or adjournments thereof,
for the purposes set forth herein and in the accompanying Notice of Special
Meeting of Stockholders. The Special Meeting will be held at the principal
office of the Company, 1850 Ramtron Drive, Colorado Springs, Colorado 80921.
These proxy solicitation materials were first mailed on or about February 5,
1999 to all stockholders entitled to vote at the Special Meeting.
Only stockholders of record at the close of business on February 3, 1999 (the
"Record Date") are entitled to notice of, and to vote at, the Special
Meeting. At the Record Date, XX,XXX,XXX shares of Common Stock were issued
and outstanding.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Secretary of the
Company a written notice of revocation or a duly executed proxy bearing a
later date or by attending the Special Meeting and voting in person.
The Company's principal place of business is 1850 Ramtron Drive, Colorado
Springs, Colorado 80921.
VOTING AND SOLICITATION
On all matters, each share of Common Stock has one vote. The affirmative vote
of a majority of the outstanding shares of Common Stock is required for the
approval of the proposal contained herein (the "Proposal"). Abstensions and
broker-non votes (shares held by brokers or nominees that are present in
person or represented by proxy, but are not voted on a particular matter
because instructions were never received by the broker or nominee from the
beneficial owner) are counted as shares that are entitled to vote for purposes
of determining the presence of a quorum at the Special Meeting. Abstensions
and broker-non votes will be treated as shares which are not voted with
respect to the Proposal and will have the same effect as negative votes.
The costs of this solicitation will be borne by the Company. The Company has
retained the services of Innisfree M & A, Inc. to assist in distributing proxy
materials to brokerage houses, banks, custodians and other nominee holders.
The estimated cost of such services is $1,500.00 plus out-of-pocket expenses.
Although there are no formal agreements to do so, the Company may reimburse
brokerage houses and other persons representing beneficial owners of shares
for their expenses in forwarding proxy materials to such beneficial owners.
Proxies may also be solicited personally or by telephone or telegram by
certain of the Company's directors, officers and regular employees, without
additional compensation.
<PAGE>
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of December 31, 1998 by: (i) each
person who is known by the Company to own beneficially more than 5% of the
outstanding shares of the Company's Common Stock; (ii) each of the Company's
directors; (iii) each of the Company's executive officers; and (iv) all
current directors and executive officers of the Company as a group. Shares of
the Company's Common Stock issuable upon conversion of outstanding convertible
notes and debentures and the Company's Series A Convertible Preferred Stock,
$0.01 par value (the "Series A Preferred") are not deemed outstanding for
these purposes as the number of shares of Common Stock issuable upon
conversion of each such security fluctuates based on changes in the market
price for the Common Stock.
Shares of Common Stock Percent
Name of Beneficial Owner(1) Beneficially Owned of Class
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National Electrical Benefit Fund 12,944,804(2) 19.9%
1125 15th Street, N.W., Room 912
Washington, D.C. 20005
NTC Liquidating Trust 7,489,390(3) 11.8
Price Waterhouse
200 E. Randolph Dr., STE 7600
Chicago, IL 60601
Benton Liquidating Trust 1,839,621(4) 3.0
Price Waterhouse
200 E. Randolph Dr., STE 7600
Chicago, IL 60601
L. David Sikes 269,250(5) *
George J. Stathakis 250,500(6) *
Greg B. Jones 148,000(7) *
Richard L. Mohr 144,028(8) *
Donald G. Carrigan 97,216(9) *
Craig W. Rhodine 90,320(10) *
William G. Howard 40,000(11) *
William G. Tull 0 *
Eric A. Balzer 0 *
All current directors and executive
officers as a group (9 persons) 1,039,314(12) 1.7
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<PAGE>
* Less than one percent
(1) Such persons have sole voting and investment power with respect to all
shares of Common Stock shown as being beneficially owned by them, subject
to community property laws where applicable, except as otherwise
indicated in the information contained in these footnotes.
(2) Includes: (i) 8,193,399 shares of Common Stock owned by the Fund;
(ii) 4,028,485 shares of Common Stock issuable upon exercise of warrants
held by the Fund; (iii) approximately 677,920 shares issuable as of
December 31, 1998 upon conversion of a convertible promissory note dated
August 31, 1995 made by the Company in favor of the Fund; and (iv) 45,000
shares of Common Stock issuable to the Fund pursuant to options which are
currently exercisable or become exercisable within 60 days after
December 31, 1998. The trustees of the Fund share voting and dispositive
powers as to such shares.
(3) In an amended Schedule 13D dated June 17, 1998, the NTC Liquidating Trust
reported sole voting and sole dispositive power as to 7,489,390 shares of
Common Stock consisting of: (i) 4,528,174 shares of Common Stock owned
directly; and (ii) 2,961,216 shares of Common Stock issuable upon
exercise of warrants held by the NTC Liquidating Trust.
(4) In an amended Schedule 13D dated June 25, 1998, the Benton Liquidating
Trust reported sole voting and sole dispositive power as to 1,839,621
shares of Common Stock owned directly.
(5) Includes: (i) 10,500 shares of Common Stock owned directly; and
(ii) 258,750 shares issuable to Mr. Sikes pursuant to options which are
currently exercisable or become exercisable within 60 days after
December 31, 1998.
(6) Includes: (i) 10,500 shares of Common Stock owned directly; and
(ii) 240,000 shares issuable to Mr. Stathakis pursuant to options which
are currently exercisable or become exercisable within 60 days after
December 31, 1998.
(7) Includes: (i) 13,000 shares of Common Stock owned directly; and
(ii) 135,000 shares issuable to Mr. Jones pursuant to options which are
currently exercisable or become exercisable within 60 days after
December 31, 1998.
(8) Includes: (i) 10,890 shares of Common Stock owned directly; and
(ii) 133,138 shares issuable to Mr. Mohr pursuant to options which are
currently exercisable or become exercisable within 60 days after
December 31, 1998.
<PAGE>
(9) Includes: (i) 10,841 shares of Common Stock owned directly; and
(ii) 86,375 shares issuable to Mr. Carrigan pursuant to options which
are currently exercisable or become exercisable within 60 days after
December 31, 1998.
(10) Includes: (i) 6,000 shares of Common Stock owned directly; and
(ii) 84,320 shares issuable to Mr. Rhodine pursuant to options which
are currently exercisable or become exercisable within 60 days after
December 31, 1998.
(11) Such shares of Common Stock are issuable pursuant to options which are
currently exercisable or become exercisable within 60 days after
December 31, 1998.
(12) Includes 977,583 shares of Common Stock issuable to current officers
and directors pursuant to options, which are currently exercisable or
become exercisable within 60 days after December 31, 1998.
PROPOSAL
APPROVAL OF A SERIES OF AMENDMENTS TO THE COMPANY'S CERTIFICATE OF
INCORPORATION, AS AMENDED, TO EFFECT, AT ANY TIME PRIOR TO JANUARY 1, 2000,
REVERSE STOCK SPLITS OF THE COMPANY'S COMMON STOCK, WHEREBY EACH 1.5, 2, 2.5,
3, 3.5, 4, 4.5 AND 5 OUTSTANDING SHARES WOULD BE COMBINED, CONVERTED AND
CHANGED INTO ONE SHARE OF COMMON STOCK, WITH THE EFFECTIVENESS OF ONE OF SUCH
AMENDMENTS AND THE ABANDONMENT OF THE OTHER AMENDMENTS, OR THE ABANDONMENT OF
ALL AMENDMENTS, TO BE DETERMINED BY THE BOARD.
GENERAL
On December 22, 1998 and January 4, 1999, the Board of Directors of the
Company considered and unanimously adopted resolutions declaring the
advisability of a series of amendments to the Company's Certificate of
Incorporation, as amended ("Certificate of Incorporation"), to effect, at
any time prior to January 1, 2000, reverse stock splits of the Company's
Common Stock whereby each 1.5, 2, 2.5, 3, 3.5, 4, 4.5, and 5 outstanding
shares would be combined, converted and changed into one share of Common Stock
(the "Reverse Stock Splits"), with the effectiveness of one of such
amendments and the abandonment of the other amendments, or the abandonment of
all amendments, to be determined by the Board. If the Board determines to
effect one of the Reverse Stock Splits (the "Effective Reverse Stock Split")
by filing the applicable amendment with the Secretary of State of the State of
Delaware, all other amendments shall be abandoned. Approval of the Reverse
Stock Splits will authorize the Board in its discretion to effectuate the
Effective Reverse Stock Split in any of the following ratios: 1:1.5, 1:2,
1:2.5, 1:3, 1:3.5, 1:4, 1:4.5, and 1:5. The Board believes that stockholder
approval of a range of exchange ratios (as opposed to a specified exchange
ratio) within which the Reverse Stock Splits may be effected will provide the
Board with flexibility to achieve the purposes of the Reverse Stock Splits.
See "Reasons for the Reverse Stock Splits," below.
<PAGE>
If the Reverse Stock Splits are approved by the stockholders and following
such approval the Board determines an Effective Reverse Stock Split is in the
best interests of the Company and its stockholders, Article FOURTH of the
Company's Certificate of Incorporation would be amended as set forth in the
Certificate of Amendment to the Certificate of Incorporation (the
"Certificate of Amendment"), attached to this Proxy Statement as Exhibit A;
provided, however, that such form of Certificate of Amendment is subject to
amendment to include such changes as may be required by the office of the
Secretary of State of the State of Delaware and as the Board deems necessary
and advisable to effect the Effective Reverse Stock Split.
An Effective Reverse Stock Split would become effective on the date of filing
of the Certificate of Amendment (the "Effective Date") as of the time of
filing with the office of the Secretary of State of the State of Delaware.
Except as set forth below with respect to fractional shares, on the Effective
Date, each share of Common Stock issued and outstanding immediately prior
thereto (the "Old Common Stock") will be automatically and without any action
on the part of the stockholders combined, converted and changed into new
shares of Common Stock (the "New Common Stock") in accordance with the
Effective Reverse Stock Split ratio determined by the Board within the limits
set forth in this Proposal, that is, .67 share, for the ratio 1:1.5, through
and including .2 share, for the ratio 1:5.
Except as may result from the payment of cash for fractional shares, as
described below, each stockholder will hold the same percentage of Common
Stock outstanding immediately following an Effective Reverse Stock Split as
each such stockholder did immediately prior to such Effective Reverse Stock
Split. Upon effectiveness, an Effective Reverse Stock Split will result in a
reduction of the number of shares of Common Stock issued and outstanding and a
corresponding increase in the number of authorized and unissued shares of the
Company's Common Stock. As described more fully in "Effects of the Reverse
Stock Splits on Ownership and Control," conversions of shares of Series A
Preferred will result in dilution to holders of the Company's Common Stock.
If the Reverse Stock Splits are approved by the stockholders of the Company at
the Special Meeting, an Effective Reverse Stock Split will be effected, if at
all, only upon a determination by the Board, in consultation with CIBC
Oppenheimer Corporation ("CIBC"), the Company's financial advisor, that the
Effective Reverse Stock Split (in a reverse split ratio determined by the
Board upon advice of its financial advisor within the limits set forth in this
Proposal) is in the best interests of the Company and its stockholders. Such
determination shall be based upon certain factors, principally including but
not limited to whether an agreement is reached with the holders of the Series
A Preferred regarding conversion and other terms and conditions of the Series
A Preferred, the likely effect of the Effective Reverse Stock Split on the
market price of the Common Stock, the Company's working capital needs in light
of the existing and expected marketability and liquidity of the Common Stock
and prevailing market conditions. In consideration of the reasons as herein
described, the Board determined the advisability of the Reverse Stock Splits
and, depending on the foregoing factors and such other reasons and
circumstances as may exist at the time, the Board expects to effect one of the
Reverse Stock Splits if the Reverse Stock Splits are authorized by the
stockholders.
<PAGE>
Notwithstanding approval of the Reverse Stock Splits by the stockholders at
the Special Meeting, the Board may, in its sole discretion, determine not to
effect any of the Reverse Stock Splits prior to January 1, 2000. If the Board
fails to implement any of the Reverse Stock Splits prior to such date,
stockholder approval again would be required prior to implementing any reverse
stock split or other change in the Company's authorized capital stock.
REASONS FOR THE REVERSE STOCK SPLITS; EFFECTS OF NON-APPROVAL OF THE REVERSE
STOCK SPLITS
The Board declared the advisability of the Reverse Stock Splits and will
effect an Effective Reverse Stock Split, if at all, because, among other
reasons, it should permit the Company to satisfy requests to convert Series A
Preferred pursuant to the terms of the Company's Preferred Stock Investment
Agreements with the holders of the Series A Preferred and the Certificate of
Designation, Preferences, Rights and Limitations of the Series A Preferred
(the "Certificate of Designation"), and depending on the number and time of
such conversions, it should (a) result in a per share price increase
sufficient to enable the Company's Common Stock to remain eligible for listing
on the Nasdaq National Market, although any such per share price increase will
be dependent on, among other factors, whether the Company reaches an agreement
with the holders of the Series A Preferred, the Company's operating
performance, general market conditions and other factors affecting the market
price of the Company's Common Stock, and (b) enhance the Company's ability to
raise capital in the future by making available authorized but unissued shares
of Common Stock. Upon filing of the Certificate of Amendment, the Company's
suspension of conversions of Series A Preferred will be lifted and Series A
Preferred conversion requests will be honored.
In February 1998, the Company issued in a private placement 17,425 shares of
Series A Preferred, at $1,000 per share. As partial consideration for placing
such securities, the placement agents received five-year warrants to acquire
an aggregate of 1,742 shares of Series A Preferred at an exercise price of
$1,000 per share (the "Series A Preferred Warrants"). The net proceeds to the
Company (after cash fees to the placement agents and estimated transaction
expenses) were approximately $16 million, which have been utilized in part for
working capital purposes and in the continued research and development,
manufacturing, and marketing of the Company's ferroelectric random access
memory and enhanced dynamic random access memory technologies. Pursuant to a
Registration Statement on Form S-3, effective March 23, 1998 (the
"Registration Statement"), the Company has registered with the Securities
and Exchange Commission the shares of Common Stock issuable upon conversion of
the Series A Preferred (including the shares of Series A Preferred issued or
issuable upon exercise of the Series A Preferred Warrants), for resale under
the Securities Act of 1933, as amended. If an Effective Reverse Stock Split
is effected, the Company expects to file, if required, a new Registration
Statement on Form S-3, or other applicable form, to register the resale of the
shares of Common Stock issued or issuable upon conversion of the Series A
Preferred.
<PAGE>
As indicated in the Proxy Statement sent to stockholders of the Company in
connection with the Annual Meeting of Stockholders held on May 28, 1998, at
which the stockholders approved and reserved for issuance the shares of Common
Stock issuable upon conversion of the Series A Preferred, the aggregate number
of shares of Common Stock issuable as a result of future conversions of the
Series A Preferred could not be determined, and still cannot be determined,
because such number is subject to adjustment mechanisms dependent on future
events, principally the trading price of the Common Stock and the conversion
decisions of holders of the Series A Preferred. The number of shares of
Common Stock issuable upon conversion of the Series A Preferred increases as
the market price of the Common Stock decreases (and decreases as such market
price increases).
Subsequent to the 1998 Annual Meeting of Stockholders, and particularly during
the period from August to October, the Company's stock price decreased
significantly, with the result that the number of shares of Common Stock
issuable upon conversion of all the outstanding shares of Series A Preferred
materially increased. Due to the Company's issuances of large numbers of
shares of Common Stock in connection with conversion notices it received from
holders of Series A Preferred, the Company currently does not have additional
authorized shares of Common Stock available to issue to holders of Series A
Preferred who elect to convert their Series A Preferred into Common Stock.
Through October 21, 1998, the Company had issued, from its authorized but
unissued and unreserved shares, the maximum number of shares of Common Stock
available for such conversions. On October 21, 1998, the Company notified the
holders of the Series A Preferred, and issued a press release announcing, that
it had suspended conversion of its Series A Preferred. As of the date of this
Proxy Statement, approximately 60,427,612 shares of Common Stock have been
issued and are outstanding and approximately 14,572,388 shares of Common
Stock are reserved for issuance pursuant to pre-existing options, warrants,
debt conversion, and the common stock purchase agreement entered into in
December 1997, between the Company and certain affiliates of Dimensional Fund
Advisors (the "DFA Agreement") which provides for additional shares to be
issued to the purchasers of Common Stock based on subsequent sales of common
stock at a price lower than that paid by the purchasers. Approximately $9.9
million of Series A Preferred remain outstanding. If all of the remaining
outstanding shares of Series A Preferred were to be converted pursuant to the
terms of the Series A Preferred using the lowest stock price of the fourth
quarter 1998 ($0.25 per share), the total number of shares of Common Stock
required for such conversion, with the applicable discount and, including
accrued dividends at December 31, 1998, would be 46,139,431.
In view of the rapid decline in the price of the Company's Common Stock in the
third and fourth quarters of 1998, and the suspension on October 21, 1998, of
conversions of the Series A Preferred, the Company has attempted to resolve
the situation resulting from the inconvertibility of the Series A Preferred
through negotiations with the holders of the Series A Preferred, and on
November 9, 1998, the Company retained CIBC as its financial advisor to assist
the Company in those negotiations and in connection with the possible
reorganization of the Company's capital structure. As of the date of mailing
of this Proxy Statement, negotiations with the holders of the Series A
Preferred are continuing but have not yet resulted in an agreement between the
Company and the holders of the Series A Preferred.
<PAGE>
In November 1998, Deere Park Capital Management LLC ("Deere Park"), a holder
of Series A Preferred, filed a lawsuit against the Company in the Court of
Chancery of the State of Delaware seeking a declaratory judgment and specific
performance of the Company's alleged obligation to convert a portion of Deere
Park's shares of Series A Preferred to Common Stock, as well as damages of
$2.4 million plus costs and attorneys fees. On December 16, 1998, the Company
filed its Answer denying the allegations of the Complaint and asserting, among
other things, that the Company had fully performed its contractual obligation
with respect to the conversions alleged in the Complaint. While the Company
believes that it has good defenses to the allegations made, there can be no
assurances that the Company will ultimately prevail in this action. A
successful action by Deere Park against the Company in this matter may have
material adverse effects on the Company.
Under the Certificate of Designation, "the Company shall at all times reserve
and keep available out of its authorized but unissued shares of common stock,
solely for the purpose of effecting the conversion of the shares of the Series
A Preferred, such number of its shares of Common Stock as shall from time to
time be sufficient to effect the conversion of all outstanding shares of the
Series A Preferred . . . ." The Certificate of Designation also states that
"if at any time the number of authorized but unissued shares of Common Stock
shall not be sufficient to effect the conversion of all then outstanding
shares of the Series A Preferred, the Company will take such corporate action
as may, in the opinion of its counsel, be necessary to increase its authorized
but unissued shares of Common Stock to such number of shares as shall be
sufficient for such purpose, including without limitation, engaging in best
efforts to obtain the requisite shareholder approval as promptly as
practicable." As noted above, the Board declared the advisability of the
Reverse Stock Splits and has called the Special Meeting for the reasons
described herein, including satisfaction of the Company's obligation under the
terms of the Series A Preferred. If the stockholders do not approve the
Reverse Stock Splits, the Company believes that it will have satisfied its
obligation to seek an increase in the number of authorized but unissued shares
of Common Stock. While other holders of the Series A Preferred may commence
legal actions against the Company seeking damages or other relief if the
Reverse Stock Splits are not approved by the stockholders and no agreement
with the holders of the Series A Preferred is reached, the Company believes
that any such action based upon its obligation to seek an increase in the
number of authorized but unissued shares of Common Stock would be without
merit and the Company intends to defend vigorously any such action. There can
be no assurance, however, that the Company would be successful in the defense
of any such action, or that any such action, if successful, would not have a
material adverse effect on the Company.
<PAGE>
In order to remain listed on the Nasdaq National Market, the Company's Common
Stock must comply with a minimum bid price of $1.00 per share. During the
1998 calendar year, the closing bid price for the Common Stock on the Nasdaq
National Market ranged from $5.75 to $0.25 per share. On December 2,
1998, the Nasdaq Listing Qualifications Department notified the Company in
writing that the Company's Common Stock had failed to maintain a closing bid
price greater than or equal to $1.00 per share for the preceding thirty days
as required by the Nasdaq National Market, and that failure to maintain a
closing bid price of $1.00 per share or greater for a minimum of ten
consecutive trading days within ninety days from the date of the letter would
result in the termination of designation ("delisting") of the Company's
Common Stock as a Nasdaq National Market security. Delisting of the Company's
Common Stock as a Nasdaq National Market security can be expected to adversely
affect the trading and liquidity of the Common Stock. Delisting of the
Company's Common Stock as a Nasdaq National Market security could also
adversely affect the ability of the Company to raise capital in the future. In
the event of such delisting, the Company would seek to cause the shares of
Common Stock to be quoted in the "pink sheets" maintained by the National
Quotation Bureau, Inc. or the NASD Electronic Bulletin Board, and the spread
between the "bid" and "asked" prices of the shares of Common Stock quoted by
market makers is likely to be greater than it is at present, causing
stockholders to experience a greater degree of difficulty in trading of shares
of Common Stock.
The Company will likely require additional sources of capital to finance its
future operations, including its working capital needs and research and
development expenses. In discussions with CIBC, the Company has been advised
that, assuming the Company's operating performance improves, an increase in
the per share price of the Company's Common Stock, which the Company expects
as a consequence of an Effective Reverse Stock Split, may enhance the
desirability of the Common Stock in the financial community and the investing
public and broaden the investor pool from which the Company might be able to
obtain additional financing in the future. Additionally, the availability of
additional authorized but unissued shares that will result from an Effective
Reverse Stock Split may benefit the Company in the event that it engages in
future debt and/or equity financing and/or acquisitions, mergers or other
forms of business combinations in which instances the availability of
additional authorized but unissued shares may prove to be essential.
As a result of the circumstances described above, the Company currently has no
shares of Common Stock available to be issued for any of the foregoing or
other purposes beyond shares already reserved for stock option plans,
outstanding warrants, debt conversion, and for issuance pursuant to the DFA
Agreement. Accordingly, if the stockholders of the Company do not approve the
Reverse Stock Splits, the Company will be limited in its ability to honor
conversion requests from holders of the Series A Preferred, to retain listing
of its shares on the Nasdaq National Market, and to raise capital through
issuance of Common Stock or securities convertible into Common Stock in the
future. Further, failure to approve the Reverse Stock Splits may result in
the respective rights of the Company and the holders of Series A Preferred
being determined through further litigation or negotiated resolution of
adverse claims. The Board believes that stockholder approval of a range of
Reverse Stock Splits (as opposed to approval of a specified reverse stock
split), with the effectiveness of the Effective Reverse Stock Split to be
determined by the Board if and when it decides to file the applicable
Certificate of Amendment, will provide the Board with flexibility in seeking
to achieve the purposes of the Reverse Stock Splits and thus is in the best
interests of the Company and its stockholders.
<PAGE>
EFFECTS OF THE REVERSE STOCK SPLITS ON OWNERSHIP AND CONTROL
If the stockholders approve the Reverse Stock Splits, the Reverse Stock Splits
will have the effect of increasing the Company's authorized but unissued
shares of Common Stock which the Company can use to honor conversion requests.
The Company believes that if the stockholders approve the Reverse Stock
Splits, upon effecting one of the Reverse Stock Splits, the holders of the
Series A Preferred will continue to convert the Series A Preferred into Common
Stock, thus resulting in substantial dilution of the holders of the Common
Stock and, based upon the advice of CIBC, increased downward pressure on the
market price for the Common Stock.
Due to the increase in the number of authorized but unissued and unreserved
shares of Common Stock that would result from any of the Reverse Stock Splits,
the percentage and number of shares of the Company's Common Stock that are
authorized but unissued and unreserved for issuance would increase from 0%
(currently) to between approximately 33% or 25,000,000 shares (if the ratio of
1:1.5 were effected) and 80% or 60,000,000 shares (if the ratio of 1:5 were
effected). This effectively constitutes an increase in the number and
proportion of shares of the Company's Common Stock that are available for
future issuance without further stockholder approval.
The increase in the number of authorized but unissued and unreserved shares of
Common Stock, in and of itself, will not affect any stockholder's
proportionate equity interest in the Company, but the subsequent issuance of
any newly authorized shares, upon conversion of outstanding Series A Preferred
or otherwise, would have a substantial dilutive effect on the present
stockholders' proportionate equity interests. If and when the Reverse Stock
Splits are approved by the stockholders and the Certificate of Amendment
becomes effective, the Company anticipates that a potentially significant
number of additional shares of Common Stock will be issued in connection with
conversions of the Series A Preferred, which can be expected to dilute the
current stockholders equity interest in the Company and, thus, dilute such
stockholders control of the Company as well.
Except as set forth above, no one is believed to own more than 5% of the
Company's outstanding Common Stock. Accordingly, the Company does not believe
that any stockholder can individually exercise control of the Company and the
Company is aware of no group acting to influence such control. If the
proposal for the Reverse Stock Splits as described herein is adopted,
additional authorized but unissued shares of Common Stock will be available
for issuance. The issuance of those additional shares, upon conversion of the
Series A Preferred or otherwise, could result in one or more stockholders
obtaining sufficient shares of the Company's Common Stock to exercise control
of the Company. Although no holder of Series A Preferred may convert Series A
Preferred if such conversion would result in the holder together with its
affiliates becoming the beneficial owners of 10% or more of the Company's
Common Stock, holders of Series A Preferred acquiring less than 10% of the
Company's Common Stock through conversion of Series A Preferred, if they did
not sell but continued to hold such Common Stock, could, in the aggregate,
acquire ownership of a sufficient number of shares of Common Stock to elect a
majority of the members of the Board, giving such holders the ability to
effect a change of control. As of the date of this proxy statement, to the
knowledge of the Company, none of the holders of the Series A Preferred Stock
have made filings under Section 13(d) of the Securities Exchange Act of 1934
or otherwise indicated that any of them have agreed to act in concert or have
evidenced any intention to replace the existing members of the Board.
<PAGE>
EFFECTS ON THE REVERSE STOCK SPLITS ON MARKET PRICE AND MARKETABILITY
A reduction in the number of issued and outstanding shares of Common Stock
caused by an Effective Reverse Stock Split is expected to initially increase
the market price of the Common Stock to a level above the current market price
subject to, among other factors, the timing and extent of conversions of
Series A Preferred, and any agreement or lack thereof with the holders of the
Series A Preferred regarding such conversions. Stockholders should note,
however, that the effect of any of the Reverse Stock Splits upon the market
price for the Company's Common Stock cannot be accurately predicted, since
there are numerous factors and contingencies which can affect such price. In
particular, there is no assurance that the price of shares of the Common Stock
after an Effective Reverse Stock Split will be 1.5 to 5 times (as
applicable) the price of shares of the Common Stock immediately prior to an
Effective Reverse Stock Split, that the Company will satisfy the continued
listing requirements of the Nasdaq National Market following an Effective
Reverse Stock Split, or that the reduced number of shares outstanding after an
Effective Reverse Stock Split will not adversely affect the liquidity or
market price of the Common Stock. If the Reverse Stock Splits are authorized
by the stockholders, the future price of the Common Stock and the timing of
conversions of the Series A Preferred may result in unpredictable fluctuations
in the Common Stock price, with unforeseeable consequences. Thus, depending
on the timing and number of Series A Preferred conversions, the market price
of the Company's Common Stock may not be sustained at or above the required
minimum closing bid price of $1.00 to remain listed on the Nasdaq National
Market.
In theory, a decrease in the total number of shares outstanding will not
necessarily affect the marketability of the Common Stock, the type of investor
who acquires it, or the Company's reputation in the financial community. As a
practical matter, however, the Board believes, based in part on advice from
CIBC, that the increased market price of its Common Stock expected as a result
of an Effective Reverse Stock Split is likely to improve the marketability and
liquidity of the Company's Common Stock by appealing to a broader market and
will encourage interest and trading in the Common Stock, particularly if an
agreement regarding conversions of the Series A Preferred can be reached with
the holders of such stock. Because of the trading volatility often associated
with low-priced stocks, many brokerage houses and institutional investors have
internal policies and practices that prohibit them from investing in low-
priced stocks or that tend to discourage individual brokers from recommending
low-priced stocks to their customers. Additionally, the structure of trading
commissions tend to have an adverse impact upon holders of lower-priced stock
because the broker's commissions on low-priced stocks generally represent a
higher percentage of the sales price than commissions on relatively higher-
priced issues. An Effective Reverse Stock Split may result in a price level
for the Common Stock that will reduce or mitigate, to some extent, the
foregoing policies and practices of brokerage firms and diminish the adverse
impact of trading commissions on the market for the Common Stock. The
expected increased price level may also encourage interest and trading in the
Common Stock and possibly promote greater liquidity for the Company's
stockholders. Some investors, however, may view an Effective Reverse Stock
Split negatively, due to the reduced number of shares that will be available
in the public market, and the increased number of shares available for
issuance upon conversion of the Series A Preferred or for other reasons.
Thus, there is no assurance that the market price of the Common Stock will
proportionately reflect the Effective Reverse Stock Split, or that such price,
if it does rise proportionally, will continue to escalate or be sustained at
such levels in the future.
<PAGE>
An Effective Reverse Stock Split will result in some stockholders owning "odd
lots" of less than 100 shares of Common Stock received as a result of such
Effective Reverse Stock Split. Brokerage commissions and other costs of
transactions in odd lots may be higher, particularly on a per-share basis,
than the cost of transactions in even multiples of 100 shares ("round-
lots").
EFFECTS OF THE REVERSE STOCK SPLITS ON RECORD HOLDERS
On February 3, 1999, there were X,XXX holders of record of the Company's
Common Stock. There will be no significant change in the number of holders of
record of the Company's Common Stock immediately following the increase in the
number of authorized but unissued and unreserved shares of Common Stock that
will result from an Effective Reverse Stock Split. As stated above, however,
the Company anticipates that immediately following the increase in the number
of authorized but unissued and unreserved shares of Common Stock there will be
an increase in the number of record holders of Common Stock resulting from
conversions of Series A Preferred and subsequent sales of converted Common
Stock by the holders of the Series A Preferred.
EFFECTS OF THE REVERSE STOCK SPLITS ON DIVIDENDS
The issuance of additional authorized but unissued and unreserved shares of
Common Stock might be disadvantageous to current stockholders in that any
additional shares could potentially reduce per share dividends, if any.
Stockholders should consider, however, that the possible impact upon dividends
is likely to be minimal in view of the fact that the Company has never paid
dividends on Common Stock, has not adopted any policy with respect to the
payment of dividends on Common Stock, and does not intend to pay any cash
dividends on Common Stock in the foreseeable future. The Company instead
intends to utilize retained earnings, if any, for use in financing growth and
additional business opportunities.
EFFECTS OF THE REVERSE STOCK SPLITS ON TAKEOVERS
The issuance of additional shares of Common Stock available for issuance as a
result of an Effective Reverse Stock Split, while providing desirable
flexibility in carrying out corporate purposes, could potentially make it more
difficult for a third party to acquire, or discourage a third party from
obtaining, a majority of the outstanding Common Stock of the Company, thereby
having an anti-takeover effect. Although the Company's management does not
view this proposal as a means of doing so, the Company could potentially use
the additionally authorized but unissued shares of Common Stock to frustrate
persons seeking to effect a takeover or otherwise gain control of the Company
by, for example, privately placing shares with purchasers who would side with
<PAGE>
the Board in opposing a hostile takeover bid. Shares of Common Stock could
also be issued to a holder that would thereafter have sufficient voting power
to assure that any proposal to amend or repeal the By-Laws or certain
provisions of the Certificate of Incorporation would not receive the requisite
vote. Such uses of the Common Stock could render more difficult, or
discourage, an attempt to acquire control of the Company, if such transaction
were opposed by the Board. Although the increase in the number of authorized
but unissued shares of Common Stock of the Company could be construed as
having such anti-takeover effects, neither the Board nor the Company's
management views this proposal in that perspective; rather, as described
above, the Company anticipates that the newly authorized shares of Common
Stock would be used to meet its obligation to the Series A Preferred
stockholders who elect to convert Series A Preferred into Common Stock, and
for future capital raising activities.
On the other hand, as noted above, the issuance of additional shares of Common
Stock, upon conversion of the Series A Preferred or otherwise, could result in
one or more stockholders obtaining sufficient shares of the Company's Common
Stock to exercise control of the Company. Although no holder of Series A
Preferred may convert Series A Preferred if such conversion would result in
the holder together with its affiliates becoming the beneficial owners of 10%
or more of the Company's Common Stock, holders of Series A Preferred acquiring
less than 10% of the Company's Common Stock through conversion of Series A
Preferred, if they did not sell but continued to hold such Common Stock,
could, in the aggregate, acquire ownership of a sufficient number of shares of
Common Stock to elect a majority of the members of the Board, giving such
holders the ability to effect a change of control.
EFFECTS OF THE REVERSE STOCK SPLITS ON REGISTRATION AND VOTING
The Company's Common Stock is currently registered under Section 12(g) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
Company is subject to the periodic reporting and other requirements of the
Exchange Act. An Effective Reverse Stock Split will not affect the
registration of the Company's Common Stock under the Exchange Act. After an
Effective Reverse Stock Split, the Company's Common Stock will continue to be
reported on the Nasdaq National Market (assuming it meets all applicable
listing requirements) under the symbol "RMTR" (although Nasdaq will add the
letter "D" to the end of the trading symbol for a period of 20 trading days to
indicate the Reverse Stock Split has occurred).
Proportionate voting rights and other rights of the holders of Common Stock
will not be affected by an Effective Reverse Stock Split (other than as a
result of the payment of cash in lieu of fractional shares, as described
below). Although an Effective Reverse Stock Split will not affect the rights
of stockholders or any stockholder's proportionate equity interest in the
Company (subject to the treatment of fractional shares), an Effective Reverse
Stock Split will increase the ability of the Board to issue authorized and
unissued shares without further stockholder action. The number of stockholders
of record will not be affected by an Effective Reverse Stock Split (except to
the extent that any stockholder who, as a result of an Effective Reverse Stock
Split, holds only a fractional share interest and, therefore, receives cash
for that interest after an Effective Reverse Stock Split).
<PAGE>
EFFECTS OF THE REVERSE STOCK SPLITS ON THE SERIES A PREFERRED CONVERSION PRICE
The conversion price of the Series A Preferred varies in relation to the price
of the Company's Common Stock, being the lowest trading price of the Common
Stock during the 22 consecutive trading days ending with the trading date
prior to the date of conversion, reduced by a percentage which increases from
7% during the seventh calendar month after the issuance of the Series A
Preferred up to 15% during and after the fifteenth calendar month after such
issuance. Pursuant to the Certificate of Designation, the conversion price of
the Series A Preferred is subject to adjustment for customary anti-dilution
events and shall be proportionately increased to give effect to an Effective
Reverse Stock Split.
EFFECTS OF THE REVERSE STOCK SPLITS ON RESERVED SHARES AND PAR VALUE
The Reverse Stock Splits will effect a reduction in the number of shares and
an increase in the exercise price per share of Common Stock available for
issuance under the Company's employee stock option plans in proportion to the
exchange ratio of the Effective Reverse Stock Split. As of December 31, 1998,
the aggregate number of shares of Common Stock currently authorized for
issuance under the employee stock option plans is 4,479,831 (prior to giving
effect to any of the Reverse Stock Splits).
In addition to outstanding options granted under the Company's employee stock
option plan, the Company also has outstanding warrants to purchase shares of
the Company's Common Stock, debt which may be converted into Common Stock, and
reserved shares of Common Stock issuable pursuant to the DFA Agreement. Under
the terms of the warrants, the applicable provisions of the debt instrument,
and the DFA Agreement, an Effective Reverse Stock Split will effect a
reduction in the number of shares and an increase in the price per share of
the Company's Common Stock issuable upon exercise of such warrants, conversion
of such debt and issuance of the DFA Agreement shares, in proportion to the
Effective Reverse Stock Split ratio.
The par value of the Company's Common Stock and Series A Preferred will remain
at $0.01 per share following the effective time of an Effective Reverse Stock
Split, although the number of shares of Common Stock issued and outstanding
will be reduced. Accordingly, the aggregate par value of the issued and
outstanding Common Stock also will be reduced. In addition, the number of
authorized but unissued shares of Common Stock effectively will be increased
by an Effective Reverse Stock Split.
<PAGE>
PAYMENT FOR FRACTIONAL SHARES
No fractional shares of New Common Stock will be issued as a result of any of
the Reverse Stock Splits. In lieu of any such fractional share interest, each
holder of Old Common Stock, who as a result of an Effective Reverse Stock
Split would otherwise receive a fractional share of New Common Stock, will be
entitled to receive cash, in United States Dollars, in an amount equal to the
product calculated by multiplying (i) the closing sales price of the Company's
Common Stock on the Effective Date as reported on the Nasdaq National Market
or, if no such sales price exists, the mid-range between the last bid and
asked price on the Effective Date by (ii) the number of shares of Old Common
Stock held by such holder that would otherwise have been converted into a
fractional share interest. The resulting amount will be paid to such holder in
the form of a check in accordance with the exchange procedures outlined under
"Exchange of Stock Certificates," below.
EXCHANGE OF STOCK CERTIFICATES
Shortly after the Effective Date, each holder of an outstanding certificate
theretofore representing shares of Old Common Stock will receive from the
Company or Citibank, N.A., as the Company's transfer agent (the "Transfer
Agent") for an Effective Reverse Stock Split, instructions regarding the
surrender of such certificate. These instructions will include a form of
Transmittal Letter to be completed and returned to the Transfer Agent or the
Company. As soon as practicable after the surrender of any certificate
representing shares of Old Common Stock, together with a duly executed
Transmittal Letter and any other documents the Transfer Agent may specify, the
Transfer Agent will deliver to the person in whose name such certificate had
been issued a new certificate registered in the name of such person
representing the number of full shares of New Common Stock into which the
shares of Old Common Stock previously represented by the surrendered
certificate have been reclassified, and a check for any amounts to be paid in
cash in lieu of any fractional share interest. Each certificate representing
shares of New Common Stock issued in connection with an Effective Reverse
Stock Split will continue to bear any legends restricting the transfer of such
shares that were borne by the surrendered certificates representing the shares
of Old Common Stock. Until surrendered as contemplated herein, each
certificate, which immediately prior to an Effective Reverse Stock Split
represented any shares of Old Common Stock, shall be deemed at and after the
Effective Reverse Stock Split to represent the number of full shares of New
Common Stock contemplated by the preceding sentence and the right to receive
cash in lieu of any fractional share interest.
No service charges, brokerage commissions or transfer taxes will be payable by
any holder of any certificate which, prior to approval of the Reverse Stock
Splits, represented any shares of Old Common Stock, except that if any
certificates of New Common Stock are to be issued in a name other than that in
which the certificates for shares of Old Common Stock surrendered are
registered, it shall be a condition of such issuance that (i) the person
requesting such issuance shall pay to the Company any transfer taxes payable
by reason thereof or establish to the satisfaction of the Company that such
taxes have been paid or are not payable, (ii) such transfer shall comply with
all applicable federal and state securities laws, and (iii) such surrendered
certificate shall be properly endorsed and otherwise be in the proper form for
transfer.
<PAGE>
NO APPRAISAL RIGHTS
Under Delaware law, stockholders of the Company are not entitled to appraisal
rights with respect to the Reverse Stock Splits.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLITS
A summary of certain federal income tax consequences of the Reverse Stock
Splits to the Company and to individual stockholders is set forth below. The
following discussion is not intended to be, nor should it be relied on as, a
comprehensive analysis of the tax issues arising from or relating to the
Reverse Stock Splits and is based upon present federal income tax law as
currently interpreted, without taking into account possible changes in such
law or interpretations, including amendments to applicable statutes and
regulations or changes in the judicial or administrative rulings, some of
which may have retroactive effect. The Company has not and will not seek an
opinion of counsel or a ruling from the Internal Revenue Service regarding the
federal income tax consequences of the Reverse Stock Splits. Certain
stockholders such as dealers in securities, insurance companies, financial
institutions, foreign individuals and entities, tax-exempt entities, and
persons who do not hold the Common Stock as a capital asset may be subject to
special rules not discussed below. ACCORDINGLY, STOCKHOLDERS ARE ADVISED TO
CONSULT THEIR OWN TAX ADVISORS FOR MORE INFORMATION REGARDING THE EFFECTS OF
THE REVERSE STOCK SPLITS UNDER APPLICABLE FEDERAL, STATE, LOCAL AND FOREIGN
INCOME TAX LAWS.
The Company intends that an Effective Reverse Stock Split will constitute a
reorganization (a "Reorganization") within the meaning of Section
368(a)(1)(E) of the Internal Revenue Code of 1986, as amended. If the
Effective Reverse Stock Split constitutes a Reorganization, the following
federal income tax consequences should result:
1. A stockholder would not recognize any gain or loss as a result of the
Effective Reverse Stock Split except to the extent that a stockholder receives
cash in lieu of a fractional share. To the extent a stockholder receives cash
in lieu of a fractional share, the stockholder would for tax purposes be
treated as having sold the fractional share to the Company. Generally, such
stockholder would recognize a gain or loss as a result of the repurchase of a
fractional share, equal to the difference between (i) the stockholder's
proportionate adjusted basis in such fractional share, and (ii) the cash
amount received for such fractional share. Any gain would be treated as short-
term capital gain taxable at a maximum federal income tax rate of 39.6% to a
non-corporate stockholder if the stockholder has held his or her shares for
18 months or less prior to the Effective Date, or long-term capital gain
taxable at a maximum federal income tax rate of 20% to a non-corporate
stockholder if the stockholder has held his or her shares for more than
18 months prior to the Effective Date.
2. The aggregate tax basis of the shares of New Common Stock received by the
stockholder pursuant to the Effective Reverse Stock Split would equal the
aggregate tax basis of the shares of Old Common Stock held by the stockholder
immediately prior to the Effective Date of the Effective Reverse Stock Split
reduced by any basis allocated to a fractional share for which the stockholder
receives cash. The stockholder could "tack" the holding period of the Old
Common Stock prior to the Effective Reverse Stock Split to the holding period
of the New Common Stock received by the stockholder as a result of the
Effective Reverse Stock Split, provided that the shares of Old Common Stock
constituted capital assets in the hands of the stockholder.
<PAGE>
3. Holders of Series A Preferred would recognize no income, gain or loss for
federal income tax purposes as a result of the changes to the conversion
ratios for such stock incident to an Effective Reverse Stock Split.
4. The Company would not recognize gain or loss as a result of an Effective
Reverse Stock Split.
REQUIRED VOTE
The affirmative vote of the holders of a majority of the shares of Common
Stock outstanding and entitled to vote is necessary to approve a resolution
authorizing the Reverse Stock Splits and the amendment to the Certificate of
Incorporation to effect the Effective Reverse Stock Split. Proxies solicited
by the Board will be voted in favor of this Proposal unless stockholders
specify otherwise.
AT THE SPECIAL MEETING, THE STOCKHOLDERS WILL BE REQUESTED TO CONSIDER AND
APPROVE A RESOLUTION AUTHORIZING A SERIES OF AMENDMENTS TO THE COMPANY'S
CERTIFICATE OF INCORPORATION, AS AMENDED, TO EFFECT, AT ANY TIME PRIOR TO
JANUARY 1, 2000, REVERSE STOCK SPLITS OF THE COMPANY'S COMMON STOCK, WHEREBY
EACH 1.5, 2, 2.5, 3, 3.5, 4, 4.5 AND 5 OUTSTANDING SHARES WOULD BE COMBINED,
CONVERTED AND CHANGED INTO ONE SHARE OF COMMON STOCK, WITH THE EFFECTIVENESS
OF ONE OF SUCH AMENDMENTS AND THE ABANDONMENT OF THE OTHER AMENDMENTS, OR THE
ABANDONMENT OF ALL AMENDMENTS, TO BE DETERMINED BY THE BOARD. THE AFFIRMATIVE
VOTE OF A MAJORITY OF THE OUTSTANDING SHARES OF THE COMPANY'S COMMON STOCK
WILL BE REQUIRED TO APPROVE ANY SUCH REVERSE STOCK SPLIT. THE BOARD
RECOMMENDS THAT STOCKHOLDERS VOTE FOR APPROVAL OF THIS PROPOSAL.
OTHER MATTERS
The Company currently knows of no matters to be submitted at the Special
Meeting other than those described herein. If any other matters properly come
before the Special Meeting, it is the intention of the persons named on the
enclosed proxy card to vote the shares they represent as the Board may
recommend.
Proposals of stockholders of the Company made under Securities and Exchange
Commission Rule 14a-8, which were intended to be presented by such
stockholders at the next annual meeting of stockholders of the Company to be
held after the Special Meeting, were to be received by the Company not later
than December 15, 1998, in order for such proposals to be included in the
proxy statement and form of proxy relating to that annual meeting. No such
proposals were received by the Company.
All other stockholder proposals to be presented at the 1999 Annual Meeting of
Stockholders must be submitted in writing to the Secretary of the Company at
the Company's principal offices no later than the close of business on (i) the
date that is 60 days in advance of the meeting or (ii) the date that is
10 days after the date on which the notice of the 1999 Annual Meeting is first
given to stockholders, whichever is later. The notice must provide the
information required by the Company's By-laws. A copy of these By-law
requirements will be provided upon request in writing to the Secretary of the
Company at the principal offices of the Company.
<PAGE>
The financial statements, supplementary financial information, and
management's discussion and analysis of financial condition and results of
operations included in the Company's Annual Report to Stockholders and in the
Company's Annual Report on Form 10-K for the year ended December 31, 1997, as
filed with the Securities and Exchange Commission and as may be subsequently
amended, are hereby incorporated by reference herein
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1997 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WILL BE
PROVIDED TO STOCKHOLDERS WITHOUT CHARGE UPON WRITTEN REQUEST TO RICHARD L.
MOHR, CORPORATE SECRETARY, RAMTRON INTERNATIONAL CORPORATION, CORPORATE
COMMUNICATIONS DEPARTMENT, 1850 RAMTRON DRIVE, COLORADO SPRINGS, COLORADO
80921.
<PAGE>
PROXY PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
RAMTRON INTERNATIONAL CORPORATION
March 15, 1999 Special Meeting of Stockholders
The undersigned stockholder(s) of Ramtron International Corporation, a
Delaware corporation (the "Company"), hereby acknowledges receipt of the
Notice of Special Meeting of Stockholders and Proxy Statement, each dated
February XX, 1999, and hereby appoints L. David Sikes and Greg B. Jones, and
each of them, proxies and attorneys-in-fact, with full power to each of
substitution, on behalf and in the name of the undersigned, to represent the
undersigned at the Special Meeting of Stockholders of the Company to be held
on March 15, 1999, at 2:00 p.m., Mountain Standard time, at the principal
office of the Company, located at 1850 Ramtron Drive, Colorado Springs,
Colorado 80921, and at any adjournment(s) thereof, and to vote all shares of
Common Stock to which the undersigned would be entitled, if then and there
personally present, on the matter set forth on the reverse side.
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTION IS
INDICATED, WILL BE VOTED FOR THE PROPOSAL AS SAID PROXIES DEEM ADVISABLE.
DO NOT FOLD, STAPLE OR MUTILATE.
(To be signed on Reverse Side)
SEE REVERSE SIDE
<PAGE>
RAMTRON INTERNATIONAL CORPORATION
PLEASE MARK VOTES AS IN THIS EXAMPLE USING DARK INK ONLY.
(X)
APPROVAL OF A SERIES OF AMENDMENTS TO THE COMPANY'S CERTIFICATE OF
INCORPORATION, AS AMENDED, TO EFFECT, AT ANY TIME PRIOR TO JANUARY 1, 2000,
REVERSE STOCK SPLITS OF THE COMPANY'S COMMON STOCK, WHEREBY EACH 1.5, 2, 2.5,
3, 3.5, 4, 4.5 AND 5 OUTSTANDING SHARES WOULD BE COMBINED, CONVERTED AND
CHANGED INTO ONE SHARE OF COMMON STOCK, WITH THE EFFECTIVENESS OF ONE OF SUCH
AMENDMENTS AND THE ABANDONMENT OF THE OTHER AMENDMENTS, OR THE ABANDONMENT OF
ALL AMENDMENTS, TO BE DETERMINED BY THE BOARD OF DIRECTORS.
FOR AGAINST ABSTAIN
( ) ( ) ( )
Any one of such attorneys-in-fact or substitutes as shall be present and shall
act at said meeting or any adjournment(s) thereof shall have and may exercise
all powers of said attorney-in-fact hereunder.
Dated 1999.
-------------------
Signature(s)
-----------------------------------------------------------------
(This Proxy should be marked, dated and signed by the stockholder(s) exactly
as his or her names appear hereon and returned promptly in the enclosed
envelope. Persons signing in a fiduciary capacity should so indicate. If
shares are held by joint tenants or as community property, both should sign.)
==============================================================================
BY ORDER OF THE BOARD OF DIRECTORS
------------------------
Richard L. Mohr
Secretary
Colorado Springs, Colorado
February XX, 1999
EXHIBIT A
FORM OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
OF
RAMTRON INTERNATIONAL CORPORATION
Ramtron International Corporation, a corporation organized and existing under
the General Corporation Law of the State of Delaware (the "Corporation"), does
hereby certify:
FIRST: That the first numbered paragraph of Article FOURTH of the Certificate
of Incorporation, as amended, is hereby deleted and the following is
substituted in lieu thereof:
"FOURTH: The total number of shares of capital stock which the Corporation
shall have authority to issue is 85,000,000, consisting of 75,000,000 shares
of common stock, par value $0.01 per share (the "Common Stock"), and
10,000,000 shares of preferred stock, par value $0.01 per shares (the
"Preferred Stock").
Immediately upon the filing of this Amendment to the Certificate of
Incorporation (the "Effective Time"), [each one and one-half (1.5), two (2),
two and one half (2.5), three (3), three and one-half (3.5), four (4), four
and one half (4.5), or five (5)] shares of the Common Stock, issued and
outstanding immediately prior to the Effective Time (the "Old Common
Stock"), shall automatically, without further action on the part of the
Corporation or any holder of Old Common Stock, be combined, converted and
changed into one (1) fully paid and nonassessable share of Common Stock (the
"New Common Stock" and the "Reverse Stock Split"), subject to the
treatment of fractional share interests as described below. The
conversion of the Old Common Stock into New Common Stock will be deemed
to occur at the Effective Time regardless of when the certificates
representing such Old Common Stock are physically surrendered to the
Corporation in exchange for certificates representing New Common Stock. After
the Effective Time, certificates representing the Old Common Stock will, until
surrendered to the Corporation in exchange for New Common Stock, represent the
number of shares of New Common Stock into which such Old Common Stock shall
have been converted pursuant to this Amendment and the right to receive cash
in lieu of any fractional share interest. No certificates representing
fractional shares of New Common Stock shall be issued in connection with the
Reverse Stock Split. Holders who otherwise would be entitled to receive
fractional share interests of New Common Stock shall be entitled to receive in
lieu of fractional shares and upon surrender to the Corporation's transfer
<PAGE>
agent of their certificates representing Old Common Stock, duly endorsed, a
cash payment in an amount equal to the product calculated by multiplying
(i) the closing sales price of the Corporation's Common Stock on the Effective
Date as reported on the Nasdaq National Market or, if no such sales price
exists, the mid-range between the last bid and asked price on the Effective
Date by (ii) the number of shares of Old Common Stock held by such holder that
would otherwise have been converted into a fractional share interest. Upon
surrender by a holder of Old Common Stock of a certificate or certificates for
Old Common Stock, duly endorsed, to the Corporation's transfer agent, the
Corporation shall, as soon as practicable thereafter, issue and deliver to
such holder of Old Common Stock, or to the nominee or nominees of such holder,
a certificate or certificates for the number of shares of New Common Stock to
which such holder shall be entitled as aforesaid together with cash in lieu of
any fractional share interest."
SECOND: That said Amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
