SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
[Amendment No. _________]
Filed by the Registrant _X_
Filed by a Party other than the Registrant ___
Check the appropriate box:
___ Preliminary Proxy Statement
___ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
_X_ Definitive Proxy Statement
___ Definitive Additional Materials
___ Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
METEOR INDUSTRIES, INC.
(Name of Registrant as Specified in Its Charter)
METEOR INDUSTRIES, INC.
(Name of Person(s) Filing Proxy Statement)
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METEOR INDUSTRIES, INC.
216 SIXTEENTH STREET, SUITE 730
DENVER, COLORADO 80202
(303) 572-1135
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 16, 1999
TO THE SHAREHOLDERS OF METEOR INDUSTRIES, INC.
NOTICE HEREBY IS GIVEN that the Annual Meeting of Shareholders of Meteor
Industries, Inc., a Colorado corporation (the "Company"), will be held at the
Adam's Mark Hotel, 1550 Court Place, Denver, Colorado, on Wednesday, June 16,
1999, at 2:00 p.m., Mountain Time, and at any and all adjournments thereof,
for the purpose of considering and acting upon the following matters.
1. The election of five (5) Directors of the Company to serve until the
next Annual Meeting of Shareholders and until their successors have been duly
elected and qualified;
2. The ratification of the appointment of PricewaterhouseCoopers LLP as
the Company's independent auditors;
3. The transaction of such other business as may properly come before
the meeting or any adjournment thereof.
Only holders of the $.001 par value common stock of the Company of record
at the close of business on May 7, 1999, will be entitled to notice of and to
vote at the Meeting or at any adjournment or adjournments thereof. The
proxies are being solicited by the Board of Directors of the Company.
All shareholders, whether or not they expect to attend the Annual Meeting
of Shareholders in person, are urged to sign and date the enclosed Proxy and
return it promptly in the enclosed postage-paid envelope which requires no
additional postage if mailed in the United States. The giving of a proxy will
not affect your right to vote in person if you attend the Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
RICHARD E. KISSER, SECRETARY
Denver, Colorado
May 7, 1999
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METEOR INDUSTRIES, INC.
216 SIXTEENTH STREET, SUITE 730
DENVER, COLORADO 80202
(303) 572-1135
------------------------------
PROXY STATEMENT
------------------------------
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 16, 1999
GENERAL INFORMATION
The enclosed Proxy is solicited by and on behalf of the Board of
Directors of Meteor Industries, Inc., a Colorado corporation (the "Company"),
for use at the Company's Annual Meeting of Shareholders to be held at the
Adam's Mark Hotel, 1550 Court Place, Denver, Colorado, on Wednesday, June 16,
1999, at 2:00 p.m., Mountain Time, and at any adjournment thereof. It is
anticipated that this Proxy Statement and the accompanying Proxy will be
mailed to the Company's shareholders on or about May 13, 1999.
Any person signing and returning the enclosed Proxy may revoke it at any
time before it is voted by giving written notice of such revocation to the
Company, or by voting in person at the Meeting. The expense of soliciting
proxies, including the cost of preparing, assembling and mailing this proxy
material to shareholders, will be borne by the Company. It is anticipated
that solicitations of proxies for the Meeting will be made only by use of the
mails; however, the Company may use the services of its Directors, Officers
and employees to solicit proxies personally or by telephone, without
additional salary or compensation to them. Brokerage houses, custodians,
nominees and fiduciaries will be requested to forward the proxy soliciting
materials to the beneficial owners of the Company's shares held of record by
such persons, and the Company will reimburse such persons for their reasonable
out-of-pocket expenses incurred by them in that connection.
All shares represented by valid proxies will be voted in accordance
therewith at the Meeting.
The Company's Annual Report on Form 10-K for the year ended December 31,
1998, is being simultaneously mailed to the Company's shareholders, but does
not constitute part of these proxy soliciting materials.
SHARES OUTSTANDING AND VOTING RIGHTS
All voting rights are vested exclusively in the holders of the Company's
$.001 par value common stock, with each share entitled to one vote. Only
shareholders of record at the close of business on May 7, 1999, are entitled
to notice of and to vote at the Meeting or any adjournment thereof. On May 7,
1999, the Company had 3,555,792 shares of its $.001 par value common stock
outstanding, each share of which is entitled to one vote on all matters to be
voted upon at the Meeting, including the election of Directors. Cumulative
voting in the election of Directors is not permitted.
A majority of the Company's outstanding common stock represented in
person or by proxy shall constitute a quorum at the Meeting.
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SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number and percentage of shares of
the Company's $.001 par value common stock owned beneficially, as of April 25,
1999, by any person, who is known to the Company to be the beneficial owner of
5% or more of such common stock, and, in addition, by each Director of the
Company, Nominee for Director, and by all Directors, Nominees for Director and
Executive Officers of the Company as a group. Information as to beneficial
ownership is based upon statements furnished to the Company by such persons.
Name and Address Amount and Nature of Percent
of Beneficial Owners Beneficial Ownership of Class
- ------------------------ -------------------- --------
Capco Resources Ltd. 1,243,350 31.7%
#950, 444 - 5th Avenue, S.W.
Calgary, Alberta
Canada TOP 2T8
Edward J. Names 427,640(1) 10.9%
216 - 16th Street, Suite 730
Denver, CO 80202
Ilyas Chaudhary 1,353,350(2) 34.5%
#950, 444 - 5th Avenue, SW
Calgary, Alberta
Canada TOP 2T8
Dennis R. Staal 140,932(3) 3.6%
216 - 16th Street, Suite 730
Denver, CO 80202
Irwin Kaufman 58,600(4) 1.5%
8224 Paseo Vista Drive
Las Vegas, NV 89128
Richard Dana 15,000(5) .04%
128 Ash Street
Denver, CO 80220
The Estate of Theron J. Graves 1,002,915(6) 22.0%
761 South Miller
Farmington, NM 87499
All Executive Officers and 2,051,062(7)(8) 51.7%
Directors as a Group
(8 Persons)
__________________
(1) Represents 40,240 shares held directly by Mr. Names, 265,000 shares held
by NFF, Ltd., a limited partnership of which he served as general partner;
2,400 shares held by his wife of which he disclaims beneficial ownership, and
120,000 shares underlying stock options exercisable within 60 days by Mr.
Names. Of the shares held by NFF, Ltd.
(2) Includes shares of the Company held by Capco Resources Ltd. of which Mr.
Chaudhary is Chairman of the Board, Chief Executive Officer and beneficially
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owns over 50% of its outstanding stock and 110,000 shares underlying stock
options exercisable within 60 days by Mr. Chaudhary.
(3) Includes 5,400 shares held by Mr. Staal; 71,500 shares held by PAMDEN,
Ltd., a limited partnership of which Mr. Staal is general partner; 8,432
shares held by Mystique Resources Company which is wholly owned by PAMDEN,
Ltd.; 600 shares held by an IRA and 55,000 shares underlying stock options
exercisable within 60 days by Mr. Staal.
(4) Consists of 45,500 shares underlying stock options and warrants
exercisable within 60 days by Mr. Kaufman and 13,600 shares owned by Mr.
Kaufman directly.
(5) Consists of 15,000 shares underlying stock options exercisable within 60
days by Mr. Dana.
(6) Represents shares of the Company's Common Stock which the estate of Mr.
Graves presently has the right to acquire upon the exchange of shares of
Graves Preferred Stock. The percentage calculation is based on actual shares
outstanding at March 31, 1999.
(7) Includes 8,985 shares held directly and 40,000 shares underlying stock
options exercisable within 60 days held by Paul W. Greaves, who is President
and Chief Executive Officer of certain of the Company's subsidiaries.
(8) Includes 4,190 shares held directly and 2,365 shares underlying stock
options exercisable within 60 days by Robert Jensen, who is President of
Fleischli Oil Company, Inc.
ELECTION OF DIRECTORS
The Company's Bylaws currently provide that the Board of Directors
consists of five members. The Board of Directors recommends the election as
Directors of the five (5) nominees listed below, to hold office until the
next Annual Meeting of Shareholders and until their successors are elected
and qualified or until their earlier death, resignation or removal. Each of
the five current members of the present Board of Directors has been nominated
for re-election. The persons named as "Proxies" in the enclosed form of Proxy
will vote the shares represented by all valid returned proxies in accordance
with the specifications of the shareholders returning such proxies. If at the
time of the Meeting any of the nominees named below should be unable to serve,
which event is not expected to occur, the discretionary authority provided in
the Proxy will be exercised to vote for such substitute nominee or nominees,
if any, as shall be designated by the Board of Directors.
The following table sets forth the name and age of each nominee for
Director, indicating all positions and offices with the Company presently
held, and the period during which each person has served as a Director:
Positions and Offices Held
Name Age and Term as a Director
---- --- --------------------------
Edward J. Names 47 President, Chief Executive Officer and
Director since 1993
Dennis R. Staal 50 Chief Financial Officer and Director since
1993
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Ilyas Chaudhary 51 Director since 1995
Irwin Kaufman 63 Director since 1997
Richard E. Dana 55 Director since 1998
There is no family relationship between any Director or Executive Officer
of the Company.
Capco Acquisub, Inc. has the right to designate two persons to be
nominated as Directors. However only one person, Ilyas Chaudhary, is
currently representing Capco Acquisub, Inc., and he is the only person it has
nominated for election at the Annual Meeting of Shareholders.
The Company has no Nominating Committee, but does have a Compensation
Committee and an Audit Committee.
On November 10, 1998 an Annual Meeting of the Board of Directors was
held. A compensation committee was established and Irwin Kaufman, Richard
Dana and Dennis Staal were appointed to the committee. Also established was
an Audit Committee. Irwin Kaufman, Richard Dana and Edward Names were
appointed to the audit committee. Since November 10, 1998, the Compensation
Committee has met one time and the audit committee has not met as of the date
of this filing.
Set forth below are the names of all directors, nominees for director and
executive officers of the Company, all positions and offices with the Company
held by each such person, the period during which he has served as such, and
the principal occupations and employment of such persons during at least the
last five years:
EDWARD J. NAMES - President, Chief Executive Officer and Director. Mr.
Names has been President and a Director of Meteor since it was incorporated in
1993. Mr. Names has extensive experience in mergers and asset acquisitions as
well as small business matters such as business planning, financing,
management and contract negotiation. Mr. Names was President of Alfa
Resources, Inc. and its subsidiaries from 1983 to 1995. Mr. Names resigned as
President of Alfa Resources, Inc. as of the closing of the CRI acquisition and
resigned as a director in 1997. In 1987, Mr. Names became Special Counsel to
the law firm of Wills and Sawyer, P.C., Denver, Colorado, and maintained that
relationship until December 1992. Mr. Names was associated with the firm of
Nelson & Harding, Denver, Colorado, from 1980 to 1981, and the law firm of
Schmidt, Elrod & Wills, Denver, Colorado, where he practiced corporate and
securities law and became a Partner in October 1982. Mr. Names received a
Bachelor of Arts Degree in Economics from the University of Colorado in 1973,
and a Juris Doctorate from the University of Denver College of Law in 1980.
He devotes his full time to the business of the Company and its subsidiaries.
DENNIS R. STAAL - Chief Financial Officer and Director. Mr. Staal has
been a Director and Chief Financial Officer of the Company since July 1993 and
was Secretary/Treasurer from July, 1993 to March 1999. He also serves as a
director of some of the Company's subsidiaries. Mr. Staal is a graduate of
the University of Nebraska, where he received a Bachelor of Science degree in
Business Administration in 1970. From 1970 through 1973, he was a CPA with
Arthur Andersen & Co. From 1973 through 1976, he was Controller for the
Health Planning Council of Omaha. From 1977 through 1981, he served as a
Director of Wulf Oil Corporation and as President of such company from 1979 to
1981. From 1979 through 1982, he served as a Director of Chadron Energy
Corporation, and as Director of the First National Bank of Chadron. From 1982
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through 1984, he was Chief Financial Officer of High Plains Genetics, Inc.
From 1986 to 1991, Mr. Staal was Director and President of Saba Petroleum
Company. Mr. Staal is currently a director and Treasurer of Alfa Resources,
Inc. As of April 1, 1999, Mr. Staal reduced the amount of time he devotes to
the business of the Company from 80% to approximately 50%.
RICHARD E. KISSER, Secretary/Treasurer and Vice President, Accounting and
Finance. Mr. Kisser was hired in June 1998 and was appointed by the Board of
Directors as the Vice President, Accounting and Finance in August 1998. On
March 1, 1999 Mr. Kisser was appointed as Secretary/Treasurer for the Company
by the Board of Directors. Mr. Kisser graduated from Central Michigan
University, where he received a Bachelor of Science degree in Accounting and
Business Management in 1978. From 1978 through 1981, he was an In-Charge
Staff Accountant with Pricewaterhouse LLP. From 1981 through 1997, Mr. Kisser
was employed by Total Petroleum, Inc. He started as Assistant Manager of
Corporate Accounting in 1981. In 1983 he was appointed Manager of Crude Oil
of Accounting and held that position until 1988. In 1988 he was promoted to
Manager of Financial Services and held that position until 1989 when he became
Manager of Crude Oil and Products Accounting. He held that position until
1990 when he was promoted to Director of Internal Audit.
ILYAS CHAUDHARY - Director. Mr. Chaudhary has been a Director of the
Company since November 1995. He has also been an officer and director of
Capco Resources, Inc. ("CRI"), which became been a wholly-owned subsidiary of
the Company, in October 1993. He was an officer and a director of Saba
Petroleum Company, (now Greka Energy Corporation) a publicly held oil and gas
company from 1985 until 1998. Mr. Chaudhary is a director and controlling
shareholder of Capco Resources Ltd.,an Alberta Stock Exchange listed company
and also Meteor's largest shareholder. Mr. Chaudhary has 25 years of
experience in various capacities in the oil and gas industry, including eight
years of employment with Schlumberger Well Services from 1972 to 1979. Mr.
Chaudhary received a Bachelor of Science degree in Electrical Engineering from
the University of Alberta, Canada.
IRWIN KAUFMAN - Mr. Kaufman has been a director of the Company since
August 1997. Mr. Kaufman is a financial consultant facilitating contacts with
the investment community. Mr. Kaufman helps arrange financing for small and
mid-sized companies and consults with management to enhance shareholder value.
He has worked as a financial consultant for the last several years. Mr.
Kaufman has also been a principal consultant for Computer and Mathematics
Education for the Sherman Fairchild Foundation.
RICHARD E. DANA - Mr. Dana has been a director of the Company since
September 1998. Mr. Dana is a business manager with experience covering
thirty years, the last 26 years of which were in the petroleum industry in
both the upstream (oil and gas exploration and production)and the downstream
(refining and marketing) sectors. From 1971 until 1998 Mr. Dana was employed
by Total Petroleum Ltd starting as a Controller in 1971, then as Treasurer in
1980 and became a Senior Vice President and Chief Financial Officer in 1989.
PAUL W. GREAVES - President and Chief Executive Officer of the
subsidiaries and General Manager of Operations for the Company. Mr. Greaves
has been the President and Chief Executive Officer of the following
subsidiaries: Meteor Marketing, Inc. (formerly Pyramid Stores, Inc.) and its
subsidiaries, Graves Oil & Butane Co., Inc. and Meteor Stores, Inc. (formerly
Hillger Oil Company) since in April, 1996. Mr. Greaves has been Chief
Executive Officer of Fleischli Oil Company, Inc. since August, 1997. Prior to
working for the Company, Mr. Greaves held the position of Regional Manager,
Rocky Mountain Region, for Propane Continental of Overland Park, Kansas, from
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April 1994 to April 1996. From 1989 until 1994, Mr. Greaves was Director of
Business Development for the Wescourt Group of Denver, Colorado, a petroleum
marketing and distribution holding company. Mr. Greaves devotes his full time
to the business of the Company and its subsidiaries described above.
ROBERT JENSEN - President of Fleischli Oil Company, Inc. (a subsidiary of
Meteor)and General Manager of the Company's commercial division. Mr. Jensen
started with Fleischli in the early 1970's has held several management and
non-management positions including warehouse/delivery person, assistant
manager of several retail gasoline stations and regional sales representative.
Mr. Jensen became President of Fleischli in 1993. Mr. Jensen graduated from
the University of Wyoming in 1981. He is involved in numerous industry
organizations having earned Salesman of the Year awards from both the Wyoming
Contractors Associations and the Wyoming Mining Association. Mr. Jensen is a
board member of the Wyoming Chapter of the National Multiple Sclerosis
Society, Cheyenne LEADS economic development group and Chairman of the
Cheyenne, Laramie County Economic Development Joint Powers Board and member of
the U.S. Chamber of Commerce.
The Company's Board of Directors held four (4) meetings during the year
ended December 31, 1998. Each Director attended at least 75% of the aggregate
number of meetings held by the Board of Directors and its Committees during
the time each such Director was a member of the Board or of any Committee of
the Board.
The Company's executive officers hold office until the next annual
meeting of directors of the Company, which currently is scheduled for June 16,
1999. There are no known arrangements or understandings between any director
or executive officer and any other person pursuant to which any of the
above-named executive officers or directors was selected as an officer or
director of the Company.
No event occurred during the past five years which is material to an
evaluation of the ability or integrity of any Director or person nominated to
be Director or Executive Officer of the Company.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of Forms 3 and 4 and amendments thereto
furnished to the Company during its most recent fiscal year, and Forms 5 and
amendments thereto furnished to the Company with respect to its most recent
fiscal year and certain representations, no persons who were either a
director, officer, or beneficial owner of more than 10% of the Company's
common stock, failed to file on a timely basis reports required by Section
16(a) of the Exchange Act during the most recent fiscal year.
EXECUTIVE COMPENSATION
The following tables set forth information regarding executive
compensation for the Company's President and Chief Executive Officer. No
other executive officer received total annual salary and bonus in excess of
$100,000 for any of the years ended December 31, 1998, 1997 or 1996.
<TABLE>
<CAPTION>
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SUMMARY COMPENSATION TABLE
Long Term Compensation
----------------------------
Annual Compensation Awards Payouts
------------------------- ----------------- ----------
Securi-
ties
Under-
Other Re- lying All
Annual stricted Options/ Other
Name and Principal Compen- Stock SARs LTIP Compen-
Position Year Salary Bonus sation Award(s) (Number) Payouts sation
- ----------------- ---- -------- ----- ------ --------- ------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Edward J. Names 1998 $105,000 -- $8,078* -- 36,910 -- --
President and 1997 $105,000 -- $5,500* -- -- -- --
Chief Executive 1996 $101,250 -- $5,040* -- -- -- --
Officer
</TABLE>
___________________
* Represents premiums paid on health insurance policies and the use of a
Company vehicle.
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<CAPTION>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
Potential
Realizable
Percent Value at Assumed
Number of Of Total Annual Rates
Securities Options/SARs Exercise Of Stock Price
Underlying Granted To Or Base Appreciation
Options/SARs Employees In Price Expiration For Option Term
Name Granted (#) Fiscal Year ($/Sh) Date 5%($) 10%($)
- --------------- ------------ ------------ -------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Edward J. Names 10,000 5.0% $3.0625 5/29/03 $ 8,461 $18,697
26,910 13.4% $3.375 11/11/03 $25,080 $55,435
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AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
Securities
Underlying Value of Unexer-
Shares Unexercised cised in-the
Acquired Options SARs Money Options/
On At FY-end SARs AT FY-end
Exercise Value Exercisable/ Exercisable/
Name (Number) Realized Unexercisable Unexercisable
- ---------------- --------- -------- ------------- ----------------
Edward J. Names -0- -0- 110,000/26,910 $-0-/$-0-
EMPLOYMENT ARRANGEMENTS
EDWARD J. NAMES, President of the Company, entered into a five-year
employment agreement with the Company which became effective in January 1994,
which provides that Mr. Names is required to devote substantially full time to
the business of the Company. The agreement was amended in January 1999 to
provide for an annual salary of $125,000 plus an annual bonus based upon the
financial performance of the Company. Pursuant to his employment agreement,
Mr. Names is allowed to devote up to 10 hours per month to other business
operations including his duties as a director or officer in other companies.
Absent notice to the contrary from the Company or Mr. Names, the five-year
term of the employment agreement renews automatically each year and such
agreement has been renewed each year. The Company can terminate his
employment, however, at any time without cause and be obligated only for two
years salary. The employment agreement includes a covenant not to compete
which is effective for one year after termination of employment.
DENNIS R. STAAL, Director of the Company has a three year consulting
agreement which provides for a fee of $400.00 per day for services as well as
restricted stock bonuses as approved by the Company's compensation committee.
He devotes approximately 50% of his time to the business of the Company and
its subsidiaries. The Company may terminate Mr. Staal's consulting agreement
at any time and be obligated for a maximum payment of approximately $50,000.
The agreement includes a covenant not to compete for nine months after
termination if Mr. Staal terminates the contract.
PAUL W. GREAVES entered into a three year employment agreement with the
Company's subsidiary, Meteor Marketing, Inc. which became effective in January
of 1999. Mr. Greaves is required to devote full time to the business of the
Company. The agreement calls for a base salary of $90,000 per year plus an
annual bonus based upon improved financial performance of Meteor and its
subsidiaries. The Company may terminate Mr. Greaves's employment at any time,
without cause and be obligated for twelve months base salary and accrued but
unpaid bonuses. The employment agreement includes a covenant not to compete
which is effective for six months after termination of employment.
ROBERT K. JENSEN, President of one of the Company's subsidiaries, entered
into an eighteen month agreement in August 1997 which was amended in January
1999 to a three year employment agreement. The amended agreement provides for
an annual salary of $79,000 plus an annual bonus based upon improved financial
performance of the Company and certain of its subsidiaries. The Company may
terminate Mr. Jensen's employment at any time, without cause and be obligated
for twelve months base salary and accrued but unpaid bonuses. The employment
agreement includes a covenant not to compete which is effective for six months
after termination of employment.
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STOCK OPTION PLAN
A stock option plan providing for the issuance of incentive stock options
and non-qualified stock options to Meteor's employees was approved by Meteor's
shareholders on April 15, 1993. Pursuant to the Plan, 500,000 shares of
Meteor's $.001 par value Common Stock have been reserved for issuance. As of
March 31, 1999, and after reducing the number of expired options, 418,000
options were issued and outstanding under the Plan.
In March 1998 Meteor granted 5,000 options each to Irwin Kaufman and
Rafiq Sayed, Directors of the Company. One half of such options vest
immediately and one half vest in March of 1999. The exercise price is $4.25
per share. Also in March, Meteor issued a total of 33,500 options to certain
employees of the Company. Such options vest over five years and expire in
March 2008.
In May of 1998 Meteor granted 10,000 options each to Edward Names, Dennis
Staal and Paul Greaves for personally guaranteeing a subsidiary note. These
options vest immediately, the exercise price is $3.06 and expire in 2003.
In June of 1998 Meteor granted 10,000 options to Richard Kisser, Vice-
President, Accounting and Finance. These options vest over three years and
expire in June 2001. The exercise price is $3.75.
In September 1998, Meteor granted 15,000 options to Richard Dana,
Director. These options vest over three years and the exercise price is
$4.125.
INCENTIVE EQUITY PLAN
The Board of Directors adopted the 1998 Incentive Equity Plan of the
Company (the "Incentive Plan") on November 10, 1998, which was approved by the
Stockholders at the Special Meeting of Shareholders held on the same day.
The purpose of the Incentive Plan is to enable the Company to attract
officers and other key employees and consultants and to provide them with
appropriate incentives and rewards for superior performance. The Incentive
Plan affords the Company the ability to respond to changes in the competitive
and legal environments by providing the Company with greater flexibility in
key employee and executive compensation than was available through the
previously approved plan or individual stock option agreements. This plan is
designed to be an omnibus plan allowing the Company to grant a wide range of
compensatory awards including stock options, stock appreciation rights,
restricted stock, deferred stock and performance shares or units. The
Incentive Plan is intended to encourage stock ownership by recipients by
providing for or increasing their proprietary interests in the Company,
thereby encouraging them to remain in the Company's employment. The Incentive
Plan has been prepared to comply with all applicable tax and securities laws,
including Section 16(b) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and state and federal tax laws.
Subject to adjustment as provided in the Incentive Plan, the number of
shares of Common Stock that may be issued or transferred, plus the amount of
shares of common Stock covered by outstanding awards granted under the
Incentive Plan, shall not in the aggregate exceed 750,000. The number of
Performance Units granted under the Incentive Plan shall not in the aggregate
exceed 200,000. The number of shares of Common Stock granted under the
Incentive Plan to any individual in any calendar year shall not in the
aggregate exceed 100,000.
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In November of 1998 Meteor issued a total of 95,500 options to certain
employees of the Company as part of the Company 1998 bonus plan. The exercise
price is $3.375 and the options will vest on November 9, 1999. These options
expire November 9, 2003.
In January of 1999 Richard Kisser was granted an additional incentive
stock option to purchase 10,000 shares at the exercise price of $3.00 per
share. These options were issued per his employment agreement and the options
will vest over a three period.
As of March 31, 1999, 355,500 options were issued and outstanding under
the Incentive Plan.
DIRECTOR COMPENSATION
Outside Directors of the Company receive fees of $250 per meeting for
telephone meeting and $750 per meeting for attendance at a meeting in person.
Each Director is reimbursed for all reasonable and necessary costs and
expenses incurred as a result of being a Director of the Company. In addition,
the Company issues options to its Directors as determined by the Board. In
January of 1999 Meteor issued to all five directors 50,000 options each at the
exercise price of $3.75. These options are non-qualified options granted
pursuant to the Company's Incentive Equity Plan and vested immediately but
become exercisable ratably over five years.
In addition to his earned regular compensation as a Director, Irwin
Kaufman received 27,500 additional options in March 1998 for outside
consulting services. These options were granted under the Company's Stock
Option Plan at an exercise price of $4.25 per share. These options expire in
March 2001.
REPORT OF COMPENSATION COMMITTEE
OVERVIEW AND PHILOSOPHY
The Board of Directors approved the formation of a Compensation Committee
on November 10,1998. The Compensation Committee has responsibility to
recommend salaries and short- and long-term incentive compensation levels for
all executive officers of the Company and its subsidiaries. It also will
advise the Board of Directors on the administration of the Company's
Incentive Stock Option Plan, the 1998 Incentive Equity Plan, and will make
recommendations concerning bonuses and other incentive compensation for
Company personnel.
The Compensation Committee currently consists of two independent non-
employee directors and one director who is also Chief Financial Officer of the
Company (and has certain other interlocking relationships as defined by the
Securities and Exchange Commission.)
The philosophy of the Compensation Committee is to provide a compensation
package for each executive officer that incentivizes the individual to fully
support the Company's business objective and to maximize stockholder value.
These compensation packages generally consist of a base salary, short-term
incentives in the form of discretionary cash bonuses, and long-term incentives
in the form of stock options.
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EXECUTIVE OFFICER COMPENSATION
The Company's compensation program for executive officers is based on the
following principles:
* Compensation should be reflective of overall Company financial
performance and an individual's contribution to the Company's
success.
* Compensation packages should be based on competitive practices
designed to attract and retain highly qualified executive officers.
* Long-term incentive compensation should be construed to closely
follow increases in stockholder return.
Cash bonuses and stock options are provided on a discretionary basis but
the amount of options issued are generally tied to the performance of the
Company. Individual executive officers and managers can earn a portion of
their cash and option bonuses based on financial performance of the Company
compared to budget and additional bonuses are paid at the discretion of the
compensation committee.
CHIEF EXECUTIVE OFFICER COMPENSATION
Mr. Names has been CEO of the Company since inception. During 1997 and
1998 Mr. Names had a base salary of $105,000 per year and was issued incentive
stock options totaling 136,910 shares.
As a result of the Company exceeding profitability goals in 1996 and
1997, Mr. Names has been issued stock options each year.
The Compensation Committee believes Mr. Names has managed the Company
well, and future incentive compensation will be based on further improvements
in Company performance. Mr. Names' base salary for 1999 has been increased to
$125,000 per year and additional options totaling 69,984 have been issued to
Mr. Names in 1999.
This report is furnished by the Compensation Committee of the Board of
Directors.
Irwin Kaufman
Richard Dana
Dennis Staal
SHAREHOLDER RETURN PERFORMANCE PRESENTATION
The performance graph shown below was prepared using data prepared by
Carl Thompson & Associates, Inc. As required by applicable rules of the SEC,
the graph was prepared based upon the following assumptions:
1. The $100 was invested in Common Stock, the S&P 500 Composite Index
and the Peer Group (as defined below) on May 14, 1996 (the effective date of
the Company's registration under Section 12 of the Securities Exchange Act of
1934).
2. Peer Group investment is weighted based on the market capitalization
of each individual company within the Peer Group at the beginning of each
year.
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3. Dividends are reinvested on the ex-dividend dates.
The companies that comprise the Company's Peer Group are as follows:
Casey's General Store; FFP Marketing Co.; Uni Marts, Inc.; Evans Systems,
Inc.; and Streicher Mobile Fueling.
METEOR INDUSTRIES, INC.
COMPARATIVE CUMULATIVE TOTAL RETURNS
METEOR INDUSTRIES, INC.
S&P 500 INDEX AND PEER GROUP
(Performance results through December 31, 1998)
[STOCK PERFORMANCE GRAPH INSERTED HERE]
5/14/96 12/31/96 12/31/97 12/31/98
Meteor Industries,
Inc. $100.00 $291.67 $236.11 $166.67
Peer Group $100.00 $ 91.91 $120.07 $135.50
S&P 500 $100.00 $112.86 $150.51 $193.52
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company leases certain real estate from the preferred stockholder of
a subsidiary. For the year ended December 31, 1998, rents paid were $60,000.
The Company leases rolling stock from various related parties under
capital lease agreements. The total obligation paid under these agreements
for the year ended December 31, 1998 was $69,000.
The Company sells its product to entities controlled by Gus Fleischli, a
Director of one of the Company's subsidiaries. During the year ended December
31, 1998, revenues reported amounted to $66,000.
In June of 1998, the Company repurchased 533,000 shares of its
outstanding common stock for $2,000,000 from Capco Resources, Ltd. Capco
Resources, Ltd. is the Company's largest shareholder, and Ilyas Chaudhary, a
Director of the Company, is a director and controlling shareholder of Capco
Resources, Ltd.
APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The independent accounting firm of PricewaterhouseCoopers LLP audited the
financial statements of the Company for the year ended December 31, 1998, and
has been selected in such capacity for the current fiscal year. At the
direction of the Board of Directors, this appointment is being presented to
the shareholders for ratification or rejection at the Annual Meeting of
Shareholders. If the shareholders do not ratify the appointment of
PricewaterhouseCoopers LLP, the appointment of auditors will be reconsidered
by the Board of Directors.
It is expected that representatives of PricewaterhouseCoopers LLP will be
present at the meeting and will be given an opportunity to make a statement if
they desire to do so. It is also expected that the representatives will be
available to respond to appropriate questions from shareholders.
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DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS
FOR THE ANNUAL MEETING TO BE HELD IN JUNE 2000
Any proposal by a shareholder intended to be presented at the Company's
Annual Meeting of Shareholders to be held in June 2000 must be received at the
offices of the Company, 216 Sixteenth Street, Suite 730, Denver, Colorado
80202, no later than January 8, 2000, in order to be included in the Company's
proxy statement and proxy relating to that meeting.
Shareholders intending to bring any business before the Annual Meeting of
Shareholders to be held in June 2000 that is not to be included in the
Company's proxy statement and proxy related to that meeting must notify the
Company, in writing, prior to March 27, 2000, of the business to be presented.
Any such notices received after said date will be considered untimely under
Rule 14a(c)(1) under the Securities Exchange Act of 1934, as amended.
RICHARD E. KISSER, SECRETARY
Denver, Colorado
May 7, 1999
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P R O X Y
METEOR INDUSTRIES, INC.
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Edward J. Names with the power to appoint
a substitute, and hereby authorizes him to represent and to vote as designated
below, all the shares of common stock of Meteor Industries, Inc. held of
record by the undersigned on May 7, 1999, at the Annual Meeting of
Shareholders to be held on June 16, 1999, or any adjournment thereof.
1. Election of Directors:
[ ] FOR all nominees listed below (except as marked to the contrary)
[ ] WITHHOLD authority to vote for all the nominees listed below:
Edward J. Names Dennis R. Staal
Ilyas Chaudhary Irwin Kaufman
Richard E. Dana
[INSTRUCTION: To withhold authority to vote for any individual nominee, cross
out that nominee's name above.]
2. The ratification of the appointment of PricewaterhouseCoopers LLP as
the Company's independent auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. To transact such other business as may properly come before the
meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR PROPOSALS 1 AND 2.
SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AT THE MEETING IN
ACCORDANCE WITH THE SHAREHOLDER'S SPECIFICATIONS ABOVE. THIS PROXY CONFERS
DISCRETIONARY AUTHORITY IN RESPECT TO MATTERS NOT KNOWN OR DETERMINED AT THE
TIME OF THE MAILING OF THE NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS TO THE
UNDERSIGNED.
The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting of Shareholders, Proxy Statement and Annual Report.
Dated: _____________, 1999.
_________________________________________
_________________________________________
Signature(s) of Shareholder(s)
Signature(s) should agree with the name(s) stenciled hereon. Executors,
administrators, trustees, guardians and attorneys should indicate when
signing. Attorneys should submit powers of attorney.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF METEOR
INDUSTRIES, INC. PLEASE SIGN AND RETURN THIS PROXY IN THE ENCLOSED
PRE-ADDRESSED ENVELOPE. THE GIVING OF A PROXY WILL NOT AFFECT YOUR RIGHT TO
VOTE IN PERSON IF YOU ATTEND THE MEETING.
