================================================================================
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:
[ ] PRELIMINARY PROXY STATEMENT
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY
(AS PERMITTED BY RULE 14A-6(E)(2))
[X] DEFINITIVE PROXY STATEMENT
[ ] DEFINITIVE ADDITIONAL MATERIALS
[ ] SOLICITING MATERIAL PURSUANT TO RULE 14A-11(C) OR RULE 14A-12
ADVANCED DEPOSITION TECHNOLOGIES, INC.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] NO FEE REQUIRED
[ ] FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES 14A-6(I)(1) 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:
- --------------------------------------------------------------------------------
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
580 MYLES STANDISH BOULEVARD
MYLES STANDISH INDUSTRIAL PARK
TAUNTON, MASSACHUSETTS 02780
DEAR STOCKHOLDER:
You are cordially invited to attend the Annual Meeting of Stockholders
of Advanced Deposition Technologies, Inc. (the "Company") to be held at 10:00
a.m. on May 24, 2000 at the Holiday Inn, 700 Miles Standish Boulevard, Taunton,
Massachusetts 02780.
At the Annual Meeting, you will be asked to elect one (1) Class I
Director of the Company and to ratify the selection of the Company's independent
accountants for the fiscal year ending December 31, 2000. The Board of Directors
recommends the approval of each of these proposals.
Further details of these matters to be considered at the Annual Meeting
are contained in the attached Proxy Statement that we urge you to consider
carefully. The Company's 1999 Annual Report, which is not part of the Proxy
Statement, is also enclosed and provides additional information regarding the
financial results of the Company in fiscal year 1999.
We hope that you will be able to attend the Annual Meeting. Whether or
not you plan to attend the Annual Meeting, it is important that your shares are
represented. Therefore, please complete, date, sign and return the enclosed
proxy card promptly in the enclosed envelope, which requires no postage if
mailed in the United States. This will ensure your proper representation at the
Annual Meeting. If you attend the Annual Meeting, you may vote in person if you
wish, even if you have previously returned your Proxy.
Sincerely,
GLENN J. WALTERS
CHIEF EXECUTIVE OFFICER, TREASURER
AND CHAIRMAN OF THE BOARD
Taunton, Massachusetts
April 25, 2000
YOUR VOTE IS IMPORTANT.
PLEASE RETURN YOUR PROXY PROMPTLY.
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
-----------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 24, 2000
-----------------------------
TO THE STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Advanced Deposition Technologies, Inc. (the "Company"), a Delaware corporation,
will be held on Wednesday, May 24, 2000 at 10:00 a.m. at the Holiday Inn, 700
Myles Standish Boulevard, Taunton, Massachusetts 02780, for the following
purposes:
1. To elect one (1) Class I Director;
2. To ratify the appointment of BDO Seidman, LLP as independent
accountants for the Company for the fiscal year ending December
31, 2000; and
3. To consider and act upon any matters incidental to the foregoing
and any other matters that may properly come before the meeting
or any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on Tuesday,
April 18, 2000 as the record date for the determination of Stockholders entitled
to notice of and to vote at the Annual Meeting and at any adjournment or
adjournments thereof.
All Stockholders are cordially invited to attend the Annual Meeting.
Whether you plan to attend the Annual Meeting or not, you are requested to
complete, sign, date and return the enclosed proxy card as soon as possible in
accordance with the instructions on the proxy card. A pre-addressed, postage
prepaid return envelope is enclosed for your convenience.
By Order of the Board of Directors
Joseph Keller
SECRETARY
Taunton, Massachusetts
April 25, 2000
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
580 MYLES STANDISH BOULEVARD
MYLES STANDISH INDUSTRIAL PARK
TAUNTON, MASSACHUSETTS 02780
(508) 823-0707
---------------------
PROXY STATEMENT
---------------------
GENERAL INFORMATION
The enclosed Proxy is solicited by the Board of Directors of Advanced
Deposition Technologies, Inc. (the "Company"), a Delaware corporation, for use
at the Annual Meeting of Stockholders to be held on Wednesday, May 24, 2000 at
10:00 a.m. at the Holiday Inn, 700 Myles Standish Boulevard, Taunton,
Massachusetts, and at any adjournment or adjournments thereof (the "Annual
Meeting").
Where the Stockholder specifies a choice on the enclosed Proxy as to
how his or her shares are to be voted on a particular matter, the shares will be
voted accordingly. If no choice is specified, the shares will be voted FOR the
election of the one (1) nominee for Class I Director named herein and FOR the
ratification of the appointment of BDO Seidman, LLP as the Company's independent
public accountants for the fiscal year ending December 31, 2000. Any Proxy given
pursuant to this solicitation may be revoked by the person giving it at any time
before its use by delivery to the Company of a written notice of revocation or a
duly executed Proxy bearing a later date. Any Stockholder who has executed a
Proxy but is present at the Annual Meeting, and who wishes to vote in person,
may do so by revoking his or her Proxy as described in the preceding sentence.
Shares represented by valid Proxies received in time for use at the Annual
Meeting and not revoked at or prior to the Annual Meeting, will be voted at the
Annual Meeting.
The close of business on April 18, 2000 has been fixed as the record
date for determining the Stockholders entitled to notice of and to vote at the
Annual Meeting. On that date, 4,894,758 shares of common stock of the Company,
$.01 par value per share (the "Common Stock"), were outstanding and entitled to
vote. Each share of Common Stock entitles the holder to one vote with respect to
all matters submitted to Stockholders at the Annual Meeting.
The Annual Report to Stockholders for the fiscal year ended December
31, 1999 is being mailed to the Stockholders with this Proxy Statement. This
Proxy Statement and the accompanying Proxy are first being mailed on or about
April 25, 2000 to all Stockholders entitled to notice of and to vote at the
Annual Meeting.
The presence of the holders of a majority of the issued and outstanding
shares of Common Stock entitled to vote at the Annual Meeting, either in person
or represented by a properly executed Proxy, is necessary to constitute a quorum
for the transaction of business at the Annual Meeting. The election of Directors
will be determined by a plurality of the votes cast. The other proposal to be
voted upon by the Stockholders of the Company requires the affirmative vote of a
majority of the shares of Common Stock present in person or represented by proxy
and voting on the proposal for passage. Abstentions and broker non-votes (which
result when a broker holding shares for a beneficial holder in "street name" has
not received timely voting instructions on certain matters from such beneficial
holder and the broker does not
<PAGE>
have discretionary voting power on such matters) are counted for purposes of
determining the presence or absence of a quorum at the Annual Meeting.
Abstentions and broker non-votes are not, however, counted for purposes of
tabulating the votes cast.
Members of the Board of Directors of the Company and officers of the
Company, as a group, own or may be deemed to control approximately 37% of the
outstanding shares of Common Stock. As there is no cumulative voting provided
for in the Company's Certificate of Incorporation, the Board of Directors and
officers are able to exert substantial influence over the election of the Board
of Directors and the outcome of any issues that may be subject to a vote by the
Company's Stockholders at the Annual Meeting. The Board of Directors and
officers have indicated their intent to vote all shares of Common Stock owned or
controlled by them in favor of each item set forth herein.
The cost of soliciting Proxies, including expenses in connection with
preparing and mailing this Proxy Statement, will be borne by the Company. In
addition, the Company will reimburse brokerage firms and other persons
representing beneficial owners of Common Stock for their expenses in forwarding
proxy materials to such beneficial owners. Solicitation of proxies by mail may
be supplemented by telephone, telegram, telex and personal solicitation by
directors, officers or employees of the Company. No additional compensation will
be paid for such solicitation.
2
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Bylaws of the Company provide that the number of directors shall be
fixed by the Board of Directors. The Bylaws also provide that the Board of
Directors shall be divided into three classes, as equal in number as possible,
with terms expiring in successive years. Directors are elected for terms of
three years and until their successors are elected and qualified. As of the date
of the last annual meeting, there were five directorships. The Board of
Directors has nominated Mr. John J. Moroney, the current Class I Director, for
re-election at the Annual Meeting (the "Director Nominee"). The Class II
Directors, with terms expiring in 2001, are Dr. Charles R. Buffler and Mr.
Robert M. Pozzo. The Class III Directors, with terms expiring in 2002, are
Messrs. Glenn J. Walters and Alexander P. Boxall.
A plurality of the votes of the shares present in person or represented
by proxy at the Annual Meeting and entitled to vote is required to elect each
Director Nominee. Unless authority to vote for any of the Director Nominees is
withheld, the shares represented by all Proxies received by the Board of
Directors will be voted for the Director Nominees. In the event that any
Director Nominee shall become unable or unwilling to serve, the shares
represented by Proxies will be voted for the election of such other person as
the Board of Directors may recommend in his place. The Board has no reason to
believe that any nominee will be unable or unwilling to serve.
THE BOARD OF DIRECTORS RECOMMENDS THE ELECTION OF MR. MORONEY AS
DIRECTOR, AND PROXIES SOLICITED BY THE BOARD WILL BE VOTED IN FAVOR THEREOF
UNLESS A STOCKHOLDER HAS INDICATED OTHERWISE ON THE PROXY.
3
<PAGE>
The following table sets forth as to the present directors of the
Company, the Director Nominees and each executive officer of the Company: (i)
name, (ii) age and (iii) present positions with the Company.
NAME AGE POSITION
- ---- --- --------
Glenn J. Walters 45 Chief Executive Officer, Treasurer
and Chairman of the Board
Alexander P. Boxall 47 President and Director
Joseph Keller 59 Controller
Richard W. Cowen 48 Vice President, Microwave Sales and
Marketing
John J. Moroney* 46 Director
Charles R. Buffler 66 Director
Robert M. Pozzo 72 Director
- ------------------
*Nominee for Director
GLENN J. WALTERS, CHIEF EXECUTIVE OFFICER, TREASURER AND CHAIRMAN OF
THE BOARD. Mr. Walters co-founded the Company in 1983 and has served as its
Treasurer and a Director since the Company's incorporation in 1985, and as its
Chief Executive Officer since March 1996. Mr. Walters served as the Company's
President from 1985 to April 1999. From July 1991 to the present, Mr. Walters
has served on the Board of Governors of the International Microwave Power
Institute, a non-profit trade association, and as President of the Microwave
Food Technology and Applications section of this association. In addition, Mr.
Walters is also a member of the Board of the Society of Vacuum Coaters, Svc. Mr.
Walters has been the primary inventor of all of the Company's technology.
ALEXANDER P. BOXALL, PRESIDENT AND DIRECTOR. Mr. Boxall has served as a
Director of the Company since March 1998 and as President of the Company since
April 1, 1999. Mr. Boxall also currently serves as Managing Director of
DNA-ADTECH, the Company's majority-owned subsidiary, a position he has held
since December 1997. Prior to that, Mr. Boxall was a co-principal and
co-managing director of DNA-ADTECH (formerly known as Alexander Boxall, S.A.)
from 1979 to December 1997. Mr. Boxall is also co-principal and director of
several capacitor distribution companies in Europe including, DNA (UK) Ltd., DNA
Central Europe and DNA Export, S.A..
JOSEPH KELLER, CONTROLLER. Mr. Keller has served as Controller of the
Company since January 1999. Prior to that he was the Controller and Chief
Financial Officer of the MicroSpring Company, a medical products manufacturer of
coronary devices and springs from January 1996 to January 1999. From November
1994 to August 1995, Mr. Keller served as Controller of Radionics, Inc., a
neurological device and software company. Prior to that, Mr. Keller held similar
positions with Mentor O & O, Inc., a manufacturer of diagnostic and surgical
equipment and instruments from March 1985 to August 1994.
RICHARD W. COWEN, VICE PRESIDENT, MICROWAVE SALES AND MARKETING. Mr.
Cowen has served as Vice President, Microwave Sales and Marketing of the Company
since April 1997. Prior to that he served as a Product Manager for the Company's
microwave products from February 1994 through April 1997.
4
<PAGE>
JOHN J. MORONEY, DIRECTOR. Mr. Moroney has served as a Director of the
Company since September 1994. He also served as Chief Operating Officer of the
Company from April 1997 to October 1998. From November 1999 to the present, he
has served as Vice President of Sales for Kewill ERP, an e-commerce company.
From October 1998 to November 1999, Mr. Moroney has served as Vice President of
Sales (East) at Digital Market, Inc., an interface software manufacturer. From
1992 to February 1997, Mr. Moroney served as Director of New England Operations
of Fourth Shift, Inc., a publicly traded supplier of manufacturing and
accounting software.
CHARLES R. BUFFLER, DIRECTOR. Dr. Buffler has served as a Director of
the Company since October 1993. From 1993 to the present, Dr. Buffler has served
as the Vice President of the Microwave Research Center, a privately held company
which specializes in microwave consulting, design and engineering.
ROBERT M. POZZO, DIRECTOR. Mr. Pozzo has served as a Director of the
Company since 1986. He is currently retired. From 1985 to 1991, Mr. Pozzo served
as a venture advisor to Zero Stage Capital Corp., a venture capital company.
COMMITTEES
The Board of Directors established an Audit Committee and a
Compensation Committee in October 1993. Members of the Audit Committee are Glenn
J. Walters, Charles R. Buffler and Robert M. Pozzo. The Audit Committee is
concerned primarily with (i) reviewing the Company's financial results and
recommending the selection of the Company's independent auditors; (ii) reviewing
the effectiveness of the Company's accounting policies and practices, financial
reporting and internal controls; (iii) reviewing the scope of independent audit
coverage, the fees charged by the independent auditors, any transactions which
may involve a potential conflict of interest, and internal control systems. The
Audit Committee had one meeting in 1999.
The Compensation Committee also consists of Messrs. Walters, Buffler
and Pozzo. The Compensation Committee is responsible for negotiating and
approving compensation arrangements for officers, employees, consultants and
Directors of the Company, excluding the granting of options to purchase Common
Stock, which function has been delegated to the Option Committee consisting of
Messrs. Buffler and Pozzo. The Compensation Committee met once in 1999. The
Option Committee met once in 1999.
The Company does not have a standing nominating committee or a
committee performing similar functions.
The Board of Directors met four times and acted by unanimous written
consent on all four occasions during 1999. All of the Directors attended at
least 75% of the meetings of the Board of Directors and of the committees of
which they served in 1999.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's executive officers and Directors, and persons who
beneficially own more than ten percent (10%) of the Common Stock, to file
initial reports of beneficial ownership on Form 3 and reports of changes in
beneficial ownership on Forms 4 and 5 with the Securities and Exchange
Commission (the "SEC") and any national securities exchange on which the
Company's securities are registered. Executive officers,
5
<PAGE>
Directors and greater than ten percent (10%) beneficial owners are required by
SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on a review of the copies of such forms furnished to the
Company and written representations from the executive officers and Directors,
the Company believes that all Section 16(a) filing requirements applicable to
its executive officers, Directors and greater than ten percent (10%) beneficial
owners were complied with for the fiscal year ended December 31, 1999.
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth the compensation paid to Mr. Glenn
Walters, the Company's Chief Executive Officer, Treasurer and Chairman of the
Board and the other most highly-compensated executive officers of the Company
who earned more than $100,000 in total compensation in fiscal year 1999
(together with Mr. Walters, the "Named Executive Officers"), with respect to
services rendered to the Company during the years ended December 31, 1999,
December 31, 1998 and December 31, 1997.
SUMMARY COMPENSATION TABLE
<TABLE><CAPTION>
LONG TERM
COMPENSATION(1)
ANNUAL ----------
COMPENSATION SECURITIES
------------------ UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY OPTIONS(#) COMPENSATION
- --------------------------- ---- -------- ---------- ------------
<S> <C> <C> <C> <C>
Glenn J. Walters 1999 $150,000 0 $57,278 (2)
Chief Executive Officer, Treasurer 1998 131,538 0 29,271 (3)
and Chairman of the Board 1997 141,286 100,000 30,545 (4)
Alexander Boxall 1999 150,000 0 0
President (5) 1998 150,000 0 0
1997 N/A N/A N/A
Richard Rollins 1999 125,000 0 0
Vice President of Corporate 1998 120,577 0 0
Manufacturing (6) 1997 N/A N/A N/A
</TABLE>
- -----------
(1) The Company did not grant any restricted stock awards or stock appreciation
rights or make any long-term incentive plan pay-outs during fiscal years
1997, 1998 or 1999.
(2) Consists of premiums paid by the Company for life insurance for 1999 to Mr.
Walters in the amount of $4,111. This amount also consists of a benefit
allowance in the amount of $20,767. Mr. Walters has the right to purchase
benefits with the foregoing allowance in his discretion. This amount also
consists of commission payments of $32,400 based on an incentive plan
approved in February, 1999 for a one year period. For more details on the
incentive plan, please see "Employment Contracts, Termination of
Employment, etc..." on page 7.
(3) Consists of premiums paid by the Company for life insurance for 1998 to Mr.
Walters in the amount of $5,966. This amount also consists of a benefit
allowance in the amount of $23,305. Mr. Walters had the right to purchase
benefits with the foregoing allowance in his discretion.
(4) Consists of premiums paid by the Company for life insurance for 1997 to Mr.
Walters in the amount of $3,964. This amount also consists of a benefit
allowance in the amount of $26,581. Mr. Walters had the right to purchase
benefits with the foregoing allowance in his discretion.
(5) Mr. Boxall was appointed President in April 1999.
(6) Mr. Rollins was appointed as Vice President, Corporate Manufacturing, in
October 1998 and resigned this position in February 2000.
6
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
(INDIVIDUAL GRANTS)
No stock options were granted to the Named Executive Officers during
fiscal year 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL-YEAR-END OPTION VALUES
The following table summarizes for the Named Executive Officers
unexercised stock options held at December 31, 1999. The value of unexercised
in-the-money options at the fiscal year end is the difference between the
exercise price and the fair market value of the underlying stock on December 31,
1999 the last business day of the fiscal year. The closing price of the
Company's Common Stock as reported by the Nasdaq Stock Market on such date was
$1.16. The Named Executive Officers did not exercise any stock options during
the year ended December 31, 1999.
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FISCAL YEAR END FISCAL YEAR END(1)
----------------------- -----------------------
NAME VESTED UNVESTED VESTED UNVESTED
- ---- ------ -------- ------ --------
Glenn J. Walters 100,000 0 $0 $0
____________
(1) Actual gains, if any, on exercise will depend on the value of the Common
Stock on the date of sale of any shares acquired upon exercise of the
option. The Named Executive Officers do not hold any stock options,
exercisable or unexercisable, at exercise prices below the fair market
value of the Common Stock on December 31, 1999 as reported by the Nasdaq
Stock Market. Such options are not "in the money" and their value is,
therefore, zero.
COMPENSATION OF DIRECTORS
The Company pays each non-employee Director $500 per year and $200 for
each meeting of the Board of Directors that he attends. Non-employee directors
are also awarded formula options under the Company's 1994 Formula Stock Option
Plan (the "1994 Plan"). Under the 1994 Plan, each non-employee Director, upon
first being elected or appointed to the Board of Directors, receives an option
to purchase 1,500 shares of the Company's Common Stock.
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
Effective as of July 1, 1993, the Company entered into an employment
and non-competition agreement (the "Employment Agreement") with Mr. Glenn
Walters, the initial term of which expired on December 31, 1996. Mr. Glenn
Walters serves as the principal executive officer of the Company. The Employment
Agreement was renewed in accordance with its terms for an additional one-year
term that expires on December 31, 2000. The Employment Agreement provides for an
initial base salary of no less than $125,000 per annum plus annual base salary
increases and such other bonuses as may be determined by the Company's Board of
Directors as well as benefits offered to the Company's employees generally. The
Employment Agreement also provides that Mr. Walters' base salary shall not be
less than 10% of his base salary in the prior year. Mr. Glenn Walters is also
entitled to the use of a Company-leased car and severance benefits equal to 200%
of his base salary, payable in a lump sum if (i) the Company or a substantial
portion of the Company is acquired without the Board of Directors' approval,
(ii) his employment is terminated without cause, (iii) his base salary is
reduced without his consent, (iv) there is a substantial change in his position
or authority within the Company without his consent, (v) there is a
7
<PAGE>
change in his principal place of employment from the greater Boston,
Massachusetts area without his consent, or (vi) the Employment Agreement is not
renewed without his consent.
The Employment Agreement provides for a renewal for successive one-year
periods after the expiration of the initial term and contains a provision
prohibiting Mr. Walters from competing with the Company, absent the Company's
prior written approval, for a two-year period following the termination of his
employment.
In February 1999, the Company's Board of Directors approved an
incentive plan for a term of one year for Mr. Walters providing for the payment
to Mr. Walters of (i) a five percent commission on all new sales of microwave
bags and laminated products and (ii) a fifteen percent commission on all new
cash license fees, including any royalties paid during the term of the incentive
plan. The incentive plan provides that the total commissions paid to Mr. Walters
shall not exceed $150,000.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of April 3, 2000
concerning the ownership of Common Stock by (i) each Stockholder who is known by
the Company to be the beneficial owner of more than 5% of the outstanding Common
Stock, (ii) each Named Executive Officer, Director and Director Nominee, and
(iii) all Directors and executive officers as a group. Except as otherwise
indicated, the Stockholders listed in the table have sole voting and investment
powers with respect to the shares indicated.
NUMBER OF SHARES PERCENTAGE OF
NAME AND ADDRESS(1) BENEFICIALLY OWNED CLASS(2)
- ------------------- ------------------ --------
Glenn J. Walters(3) 751,893 15.1%
Alexander Boxall(4) 969,348 19.8
John J. Moroney(5) 1,500 *
Charles R. Buffler(6) 3,000 *
Robert M. Pozzo(7) 107,558 2.2
Richard Rollins(8) 0 *
Gordon E. Walters(9) 273,647 5.5
37 Fort Hill Lane
Duxbury, MA 02322
All Directors and executive
officers as a group 1,833,299 36.5
(8 persons)
- --------------
* Represents beneficial ownership of less than 1% of the Company's outstanding
shares of Common Stock.
(1) The address for these individuals, other than Mr. Gordon E. Walters, is
c/o Advanced Deposition Technologies, Inc., 580 Myles Standish Boulevard,
Myles Standish Industrial Park, Taunton, Massachusetts 02780.
(2) The number of shares of Common Stock issued and outstanding on April 3,
2000 was 4,894,758 shares. The calculation of percentage ownership for
each listed beneficial owner is based upon the number of shares of Common
Stock issued and outstanding on April 3, 2000, plus shares of Common Stock
subject to options held by such persons on and exercisable within 60 days
thereafter. Shares of Common Stock that a person has the right to acquire
within 60 days of April 3, 2000, pursuant to the exercise of options are
deemed to be outstanding for the purpose of computing the
8
<PAGE>
percentage ownership of such person, but are not deemed to be outstanding
for the purpose of computing the percentage ownership of any other person
shown in the table.
(3) Consists of 497,393 shares owned directly by Mr. Walters, 100,000 shares
subject to currently exercisable options, 94,500 shares owned directly by
Mr. Walter's wife and 60,000 shares owned by the Walter's Family
Children's Trust for the benefit of Mr. Walter's minor children, of which
Mr. Walters is a co-trustee with his wife. Mr. Walters disclaims
beneficial ownership of the 60,000 shares held by the Walter's Family
Children's Trust and the 94,500 shares owned directly by his wife.
(4) Consists of 280,000 shares of Common Stock held by Mr. Boxall and 689,348
shares of Common Stock held by DNA Export, S.A., an entity owned and
controlled by Mr. Boxall.
(5) Consists of 1,500 shares of Common Stock subject to currently exercisable
options.
(6) Consists of 3,000 shares of Common Stock subject to currently exercisable
options.
(7) Includes 19,000 shares of Common Stock subject to currently exercisable
options.
(8) Vice President of Corporate Manufacturing resigned his position February
2000.
(9) Consists of 110,000 shares of Common Stock subject to currently
exercisable options owned directly by Mr. Walters, and 163,647 shares of
Common Stock owned jointly by Mr. Walters and his wife. This information
is based solely upon a Schedule 13G filed with the Securities and Exchange
Commission on February 11, 1999.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In March 1999, the Company entered into an agreement with DNA Export,
S.A. to purchase certain shares of capital stock of DNA-ADTECH held by DNA
Export, S.A. (the "Exchange Agreement"). This transaction, as approved by the
Company's Stockholders in last year's annual meeting, brought the Company's
total equity ownership in DNA-ADTECH to 81%. As consideration for the additional
equity position in DNA-ADTECH, the Company issued 598,198 shares of Common Stock
to DNA Export, S.A. Upon consummation of this transaction, Mr. Boxall, the owner
of DNA Export, S.A. beneficially owned a total of 923,348 shares of Common
Stock, or approximately 19% of the Company's Common Stock and will continue to
own 19% of DNA-ADTECH.
In addition, in March 1999, Alexander Boxall and the Company entered
into a Repayment Agreement (the "Repayment Agreement") pursuant to which the
parties agreed that in the event that the Company is unable to pay the amounts
outstanding under the promissory note issued to Pedro Nunez Barranco Guembe in
connection with the previous acquisition of his shares of DNA-ADTECH, on or
before maturity without compromising the Company's plan for growth . In December
1999, Mr. Boxall paid $990,000 in principal and $109,598 in interest, or a total
of $1,099,598 to Mr. Guembe in accordance with the Repayment Agreement. The
amount paid by Mr. Boxall is payable by the Company and bears interest at a
LIBOR rate plus 2% and becomes due on or before March 1, 2001. If the Company
has not paid by January 1, 2001, Mr. Boxall may elect at any time after January
1, 2001 through March 1, 2001, to convert all or part of the outstanding balance
into shares of Common Stock at a purchase price per share equal to the average
sales price of the Common Stock for the month of December 2000, subject to a
$3.50 per share minimum. If Mr. Boxall does not elect to convert the outstanding
balance, the Company may elect after January 31, 2001 to redeem such amount for
shares of Common Stock at a redemption price equal to the average sales price of
the Common Stock for the twenty business days preceding the date of redemption.
In connection with the financing of the acquisition of DNA-ADTECH in
December of 1997, Mr. Boxall signed a 20 year term loan with DNA-ADTECH whereby
Mr. Boxall has agreed to repay the sum of 20,000,000 pesetas (including
interest) payable in annual amounts of 1,000,000 pesetas over a term of the
loan. At December 31, 1999, a balance of 17,000,000 pesetas remain outstanding.
9
<PAGE>
PROPOSAL NO. 2
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed BDO Seidman, LLP ("BDO Seidman"),
independent public accountants, to audit the financial statements of the Company
for the fiscal year ending December 31, 2000. The Board proposes that the
Stockholders ratify this appointment, although such ratification is not required
under Delaware law or the Company's Certificate of Incorporation or Bylaws. BDO
Seidman audited the Company's financial statements for the fiscal year ended
December 31, 1999. The Company expects that representatives of BDO Seidman will
be present at the Annual Meeting, with the opportunity to make a statement if
they so desire, and will be available to respond to appropriate questions.
The affirmative vote of a majority of the shares present in person or
represented by proxy and voting on Proposal 2 is required to ratify the
appointment of the independent public accounts. In the event that ratification
of the appointment of BDO Seidman as the independent public accountants for the
Company is not obtained at the Annual Meeting, the Board of Directors will
reconsider its appointment.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE TO APPROVE THE RATIFICATION OF
THE APPOINTMENT OF BDO SEIDMAN, LLP AS INDEPENDENT PUBLIC ACCOUNTANTS, AND
PROXIES SOLICITED BY THE BOARD WILL BE VOTED IN FAVOR THEREOF UNLESS A
STOCKHOLDER HAS INDICATED OTHERWISE ON THE PROXY.
STOCKHOLDER PROPOSALS
Under Rule 14a-8 promulgated under the Exchange Act, Stockholders of
the Company may present proper proposals for inclusion in the Company's Proxy
Statement and for consideration at the next Annual Meeting of Stockholders by
submitting their proposals to the Company by December 26, 2000, which date is
120 days before the date which is the one year anniversary of the date proxy
materials were released to stockholders for the 2000 annual stockholders'
meeting. In order to be considered for inclusion in the proxy statement
distributed to Stockholders prior to the Annual Meeting in the year 2001, a
Stockholder proposal must be received by the Company within a reasonable period
of time before the Company begins to print and mail its proxy materials and must
otherwise comply with the requirements of Rule 14a-8. In order to be considered
for presentation at the annual meeting of Shareholders in the year 2000,
although not included in the proxy statement, a Shareholder proposal must be
received by the Company by March 11, 2001. Stockholder proposals should be
delivered in writing to Joseph P. Keller, Secretary, Advanced Deposition
Technologies, Inc., 580 Myles Standish Boulevard, Taunton, Massachusetts 02780.
10
<PAGE>
OTHER MATTERS
The Board of Directors knows of no other matter to be presented at the
Annual Meeting. If any other matter should be presented at the Annual Meeting
upon which a vote may be taken, such shares represented by all Proxies received
by the Board of Directors will be voted with respect thereto in accordance with
the judgment of the persons named in the Proxies.
By Order of the Board of Directors,
Joseph Keller
SECRETARY
Taunton, Massachusetts
April 25, 2000
11
<PAGE>
APPENDIX A
----------
ADVANCED DEPOSITION TECHNOLOGIES, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 24, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
THE UNDERSIGNED, revoking all prior proxies, hereby appoints Glenn J.
Walters and Alexander P. Boxall as proxies, with full power of substitution, to
vote for and on behalf of the undersigned at the Annual Meeting of Stockholders
of ADVANCED DEPOSITION TECHNOLOGIES, INC. (the "Company") to be held at 10:00
a.m. at the Holiday Inn, 700 Myles Standish Boulevard, Taunton, Massachusetts
02780, on Wednesday, May 24, 2000, and at any adjournment or adjournments
thereof, upon and with respect to all shares of the Common Stock of the Company
to which the undersigned would be entitled to vote and act if personally
present. The undersigned hereby directs Glenn J. Walters and Alexander P. Boxall
to vote in accordance with their judgment on any matters which may properly come
before the meeting, all as indicated in the Notice of the meeting, receipt of
which is hereby acknowledged, and to act on the following matters set forth in
such Notice as specified by the undersigned:
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ELECTION OF THE
DIRECTOR IDENTIFIED BELOW AND FOR PROPOSAL 2.
(1) Proposal to elect the following person as Class I Director of the
Company:
John J. Moroney [ ] FOR [ ] WITHHOLD VOTE
(2) Proposal to ratify and confirm the appointment of BDO Seidman,
LLP as the independent accountants for the Company for the fiscal
year ending December 31, 2000.
[ ] FOR [ ] AGAINST [ ]ABSTAIN
(3) IN THEIR DISCRETION TO TRANSACT SUCH OTHER BUSINESS AS MAY
PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR
ADJOURNMENTS THEREOF.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR AND IN FAVOR OF
THE ITEMS SET FORTH ABOVE UNLESS A CONTRARY SPECIFICATION IS MADE.
PLEASE MARK, DATE, SIGN AND RETURN THE PROXY PROMPTLY USING THE
ENCLOSED ENVELOPE.
Please sign exactly as name appears on your stock certificate.
Dated:
-----------------------
-----------------------------
Signature
B-1
<PAGE>
-----------------------------
Signature if held jointly
-----------------------------
Printed Name
-----------------------------
Address
NOTE: When shares are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian, please give full title
as such. If the person named on the stock certificate has died, please submit
evidence of your authority. If a corporation, please sign in full corporate name
by the President or authorized officer and indicate the signer's office. If a
partnership, please sign in the partnership name by an authorized person.
B-2
