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
[XX] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
FLEXPOINT SENSOR SYSTEMS, INC.
(Name of Registrant as Specified In Its Charter)
_______________________________________
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X ] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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>
FLEXPOINT SENSOR SYSTEMS, INC.
6906 South 300 West
Midvale, UT 84047
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
August 29, 2000
NOTICE is hereby given that the Annual Meeting of Stockholders of
Flexpoint Sensor Systems, Inc. (the "Company") will be held at the Wyndham
Hotel, 215 West South Temple, Salt Lake City, Utah 84101, at 9:00 a.m. (local
time) on August 29, 2000, for the following purposes:
1. To elect members of the board of directors.
The record date for the meeting is the close of business on July 3, 2000
and only the holders of Common Stock of the Company on that date will be
entitled to vote at such meeting or any adjournment thereof.
By order of the Board of Directors
/s/ Douglas M. Odom
-----------------------------
President
July 3, 2000
Please Return Your Signed Proxy
PLEASE COMPLETE AND PROMPTLY RETURN YOUR PROXY IN THE ENCLOSED ENVELOPE. THIS
WILL NOT PREVENT YOU FROM VOTING IN PERSON AT THE MEETING. IT WILL, HOWEVER,
HELP ASSURE A QUORUM AND AVOID ADDED PROXY SOLICITATION COSTS.
<PAGE>
PROXY STATEMENT
____________________
FLEXPOINT SENSOR SYSTEMS, INC.
6906 South 300 West
Midvale, UT 84047
__________________________
ANNUAL MEETING OF STOCKHOLDERS
To Be Held August 29, 2000
______________
INTRODUCTION
This Proxy Statement is being furnished to holders of Flexpoint Sensor
Systems, Inc. (the "Company") common stock, par value $0.001 per share
("Common Stock"), in connection with the solicitation of proxies by the
Company for use at the Annual Meeting of Stockholders of the Company (the
"Annual Meeting") to be held at the Wyndham Hotel, 215 West South Temple, Salt
Lake City, Utah 84101, at 9:00 a.m. (local time) on August 29, 2000, and at
any adjournment(s) or postponement(s) thereof. This Proxy Statement, the
enclosed Notice and the enclosed form of proxy are being first mailed to
stockholders of the Company on or about July 3, 2000.
VOTING AT THE ANNUAL MEETING
The Board of Directors of the Company (the "Board") has fixed the close
of business on July 3, 2000, as the record date (the "Record Date") for the
determination of stockholders entitled to notice of and to vote at the Annual
Meeting. As of the Record Date, there were outstanding approximately
20,554,402 shares of the Company's Common Stock held by approximately 432
holders of record and approximately 1,695 shares of Series A Convertible
Preferred stock held by approximately 21 holders of record. Unless otherwise
required by applicable law, all voting rights are vested in and exercised by
the holders of the Common Stock and Series A Convertible Preferred Stock as a
single voting group, except that holders of record of the Company's Common
Stock on the Record Date are entitled to cast one vote per share and holders
of record of the Company's Series A Preferred Stock on the Record Date are
entitled to cast two hundred fifty votes per share, exercisable in person or
by properly executed proxy, with respect to each matter to be considered by
them at the Annual Meeting. The presence, in person or by properly executed
proxy, of the holders of a majority of the outstanding shares of the Company's
Common Stock is necessary to constitute a quorum at the Annual Meeting. On the
Record Date there were no shares of the Company's stock held as treasury stock
by the Company.
Common Stock will be voted in accordance with the instructions indicated
in a properly executed proxy. If no instructions are indicated, such stock
will be voted as recommended by the Board. If any other matters are properly
presented to the Annual Meeting for action, the person(s) named in the
enclosed form(s) of proxy and acting thereunder will have discretion to vote
on such matters in accordance with their best judgment. Broker non-votes and
abstentions are not treated as votes cast for purposes of any of the matters
to be voted on at the meeting. A stockholder who has given a proxy may revoke
it by voting in person at the meeting, or by giving written notice of
revocation or a later-dated proxy to the Secretary of the Company at any time
before the closing of the polls at the meeting. Any written notice revoking a
proxy should be sent to Flexpoint Sensor Systems, Inc., 6906 South 300 West,
Midvale, UT 84047, Attention: Secretary.
The Company's Bylaws require the affirmative vote of a plurality of the
votes cast at the meeting for the election of directors. The Board recommends
that holders of the Company's Common Stock vote FOR the approval of election
of the directors proposed by the Board.
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING
1. Election of Directors
Board of Directors
The Company's Board is divided into three classes. One class of
directors is elected at each annual meeting of stockholders for a three-year
term. Each year a different class of directors is elected on a rotating basis.
The term of Don M. Jackson, Jr., expires in 2000, John Sindt, M. Richard
Wadley and J. Steven Young were appointed by the Board to serve until the
Annual Meeting. The terms of Doug M. Odom expires in 2001 and the term of
Jeffrey Coleman expires in 2002.
At this meeting four directors have been nominated by the Board for
election to the class as follows: Don M. Jackson, Jr. for a term expiring at
the 2003 annual stockholder meeting, M. Richard Wadley for a term expiring at
the 2002 annual stockholder meeting and John Sindt and J. Steven Young for
terms expiring at the 2001 annual stockholder meeting.
Unless otherwise specified, proxy votes will be cast for the election
of the nominees as directors for the periods specified. If any such person
should be unavailable for election, the Board may designate a substitute
nominee. It is intended that proxy votes will be cast for the election of such
substitute nominee. Stockholder nominations of persons for election as
directors are subject to the notice requirements described under the caption
"Other Matters" appearing later in this proxy statement. Election of the
nominee director requires the affirmative vote of a plurality of the votes
cast at the meeting for the election of directors.
The following pages contain information concerning the nominees. Unless
the context otherwise requires, all references in this Proxy to the "Company"
shall mean Flexpoint Sensor Systems, Inc. ("Flexpoint Sensor Systems") and its
wholly owned subsidiary, Sensitron, Inc. ("Sensitron"), a Utah corporation,
and the wholly owned subsidiaries of Sensitron, Flexpoint, Inc. ("Flexpoint"),
a Utah corporation and Technology and Machine Company, Inc. ("Tamco"), a Utah
corporation, on a consolidated basis and, where the context so requires, shall
include their predecessors.
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION AS A DIRECTOR OF THE NOMINEES
NAMED HEREIN.
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Set forth below is certain information concerning each of the directors
and executive officers of the Company as of June 30, 2000.
With the
Name Age Position Company Since
------- --- ----------------------------- --------------
Douglas M. Odom 40 President, Chief Executive
Officer and Director 1995
Thomas E. Danielson 38 Vice-President 1995
Jeffrey A. Coleman 40 Director 1998
Don M. Jackson, Jr. 63 Director 1998
M. Richard Wadley 56 Director 1999
John Sindt 55 Director 1999
J. Steven Young 38 Director 2000
_______________
Douglas M. Odom. Mr. Odom has been the Company's President, Chief
Executive Officer and a Director since April 1998, and has held the same
positions with respect to Flexpoint, Inc. since 1995 and with respect to
Sensitron since 1996. From 1993 to 1995, Mr. Odom served as the Marketing and
Sales Manufacturing Director of Xymox Technologies, Inc. Xymox Technologies,
Inc. is one of the world's largest manufacturers of membrane switches and
related electronic interface devices. Prior to his employment at Xymox
Technologies, Inc., Mr. Odom was a key executive in the reorganization of EEC,
Inc. from a public company in bankruptcy to private company posting profits
and positive cash flow. From 1985 to 1990, Mr. Odom was Vice president of
Operations of Comptec, Inc., a world-wide plastic injection molder and
electronic device corporation. From 1983 to 1985, Mr. Odom was the manager of
manufacturing engineering at AMP Keyboard Technologies. Mr. Odom received a
bachelors degree in General Science/Chemistry from Grinnell College, Grinnell,
Iowa in 1982. He completed his masters studies at the American Graduate School
of International Management in Glendale, Arizona and furthered graduate
studies at Harvard University, Cambridge, Massachusetts.
Thomas E. Danielson. Mr. Danielson has been the Company's Vice-President
since 1995. Mr. Danielson was with Xymox Technologies, Inc., Milwaukee,
Wisconsin from 1993 to 1995, in an operations management and sales management
role. Prior to that, Mr. Danielson was with W.H. Brady Company, Milwaukee,
Wisconsin from 1986 to 1993, in a variety of roles, including engineering,
manufacturing and sales. Mr. Danielson holds a bachelors of science degree in
Civil Engineering from the University of Wisconsin and a MBA in Production
Operations Management from the University of Wisconsin-Whitewater.
Jeffrey A. Coleman. Mr. Coleman has been a director of the Company since
April 1998, and served as a director of Sensitron since January 1998. From
1998 to present, Mr. Coleman has been operating as owner and partner of a
national real estate development and contractor company, Majestic West, LLC.
Mr. Coleman has been a managing member of Coleman Capital Partners, a private
equity investment group, since 1996. From 1985 to 1997, he was Director of
Operations for the Pyramid Group, a national real estate development,
investment and management firm. From 1982 to 1983 he was a consultant in the
Management Information Consulting Division of Arthur Andersen & Co. Mr.
Coleman received an MBA from the Amos Tuck School of Business at Dartmouth
College and a BA (honors) from Stanford University.
Don M. Jackson, Jr., PhD. Dr. Jackson has been a director of the Company
since April 1998, and served as a director of Sensitron since January 1998.
Dr. Jackson founded SITEK Incorporated , a semiconductor material and
equipment business in July of 1998. Dr. Jackson has been President and
Chairman since inception of that company. Dr. Jackson has been active in the
founding and operating of a number of semiconductor equipment and materials
companies since 1976 when he founded ASM America in Phoenix. From 1960 until
1976, Dr. Jackson held a number of technical and management positions in the
semiconductor industry, specifically Motorola and General Electric
Corporation. Dr. Jackson is a director of M & I Thunderbird Bank in Phoenix
and three other high-technology corporations. He received a Ph.D. in
Electrical Engineering from Arizona State University, an M.S. in Physics from
Iowa State University and a B.A. in Physics from William Jewell College.
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M. Richard Wadley. Mr. Wadley has served as a Director of the Company
since July, 1999. He has over 25 years of successful general management and
marketing experience with almost 20 years of full operational and profit and
loss responsibility as General Manager/President/CEO of organizations with
yearly sales of $30-$400 million. From 1993 through 1999, Mr. Wadley served as
Board Chairman and Chief Executive Officer for T-Chem Products, a private
label household cleaning product company. Prior to that he handled the
acquisition of Alta-Dena Dairy, a $150 million food products company and was
its CEO from 1989-1991. From 1986 to 1988, Mr. Wadley was
Vice-President/General Manager of Tambrands' largest division with sales of
almost $400 million and responsibility for over 3,000 employees. From 1981 to
1986, he was a Corporate Director of Product Management for Hallmark Cards.
From 1968 to 1981, Mr. Wadley held positions of increasing marketing
management responsibility with Proctor and Gamble including a successful
launch of several new products like Dawn dishwashing liquid. Mr. Wadley has a
BA degree from Brigham Young University and an MBA from Northwestern
University.
John Sindt. Mr. Sindt has been a director of the Company since December
1999. Mr. Sindt is a Salt Lake County constable. He is the president of the
National Constables Association having previously served as its corporate
secretary and director. Mr. Sindt has owned and operated a successful chain of
retail consumer goods stores. Mr. Sindt has served on the Governor's Task
Force for the State of Utah and has held office as a Senatorial District
Chairman for the Republican Party. Mr. Sindt currently has an ownership
interest in and provides business advisory services to a internet service
provider.
J. Steven Young. Mr. Young has been a director of the Company since May
2000. Mr. Young holds the honor of the highest quarterback rating in National
Football League ("NFL") history. Mr. Young has been a member of the NFL since
1985 and has received numerous NFL and collegiate awards, including, but not
limited to, Most Valuable Player of Super Bowl XXIX, Sports Illustrated and
Sporting News' 1994, 1993 and 1992 Player of the Year, NFL's Most Valuable
Player 1994 and 1992, Player of the Year, NFL's Most Valuable Player 1994 and
1992, a Consensus 1983 All-American and Heisman Trophy Winner Runner-up.
Throughout his NFL history, Mr. Young has provided marketing endorsements at
various times for Nike, Sprint, VISA, Sun Microsystems, Power Bar, Pert Plus,
National Dairy Association, Wheaties, and Advil. In 1993, Mr. Young
established the Forever Young Foundation, an international, non-profit public
charity, based in Los Altos, California, that provides funding for charitable
organizations which encourage the development, security, strength, and
spiritual vitality of the family. Mr. Young is currently a spokesperson for
The Children's Miracle Network, NFL F.A.C.T., a national program promoting
education for youth, and NFL P.L.A.Y. Football. Mr. Young also serves as a
director of Hydromaid International, Inc., a reporting company. In 1994, Mr.
Young received his Juris Doctorate degree from Brigham Young University
College of Law.
Our executive officers are elected by the board of directors on an annual
basis and serve at the discretion of the board of directors.
Board Committees
The Board has an Audit Committee and Compensation Committee. The Board
does not have a nominating committee.
The Company's Audit Committee was organized in November 1999 and held 1
meeting during 1999. The function of the Audit Committee is (a) to review the
professional services and independence of the Company's independent auditors
and the scope of the annual external audit as recommended by the independent
auditors, (b) to ensure that the scope of the annual external audit is
sufficiently comprehensive, (c) to review, in consultation with the
independent auditors, the plan and results of the annual external audit and
the adequacy of the Company's internal control systems, (d) to review, with
management and the independent auditors, the Company's annual financial
statements, financial reporting practices and the results of each external
audit, and (e) to undertake reasonably related activities to those set forth
in clauses (a) through (d) above. Members of the Audit Committee are Don M.
Jackson, Jr. and Jeffrey Coleman.
4
<PAGE>
The Company's Compensation Committee was organized in November 1999 and
held 1 meeting during 1999. The Compensation Committee administers the
Company's stock option plan, establishes a general compensation policy for the
Company and, except as prohibited by applicable law, may take any and all
actions that the Board could take relating to the compensation of employees,
directors and other parties. Don M. Jackson and Jeffrey Coleman served on the
Compensation Committee from November 1999 until June 17, 2000 when they were
replaced by John Sindt and M. Richard Wadley.
Board Meetings and Directors' Attendance
The Board held 6 meetings and took action by unanimous consent on 26
occasions during the fiscal year ended December 31, 1999. No director attended
fewer than 75 percent of the Board meetings held during the fiscal year ended
December 31, 1999.
Certain Relationships And Related Transactions
Mr. Jehu Hand, an officer and director of our company prior to the
April 1998 acquisition wherein Flexpoint, Inc. became a wholly owned
subsidiary of Flexpoint Sensor Systems, Inc., acted as legal counsel for
Nanotech, Inc.
Sens Partnership, LLC, with which Mr. Coleman was affiliated, was
issued 30,303 shares of the our common stock in December 1998. These shares
were issued to satisfy in full obligations that we made to Sens Partnership,
LLC in connection with its investment in us in December 1997.
Security Ownership of Management and Certain Beneficial Owners
The following table sets forth certain information with respect to the
beneficial ownership of our common stock as of June 30, 2000, for: (i) each
person who is known by us to beneficially own more than five percent of the
our common stock, (ii) each of our directors, (iii) each of our Named
Executive Officers (defined below), and (iv) all directors and executive
officers as a group. As of June 30, 2000, we had 20,554,402 shares of common
stock outstanding.
Shares
Name and Address Beneficially Percentage
of Beneficial Owner(1) Owned(2)(3) of Total(2)(3) Position
---------------------- ------------- -------------- ----------------
Douglas Odom 580,000(4) 2.7% President, CEO and
Director
Jeffrey A. Coleman 117,553(5) * Director
Don M. Jackson, Jr. 80,000(6) * Director
M. Richard Wadley 173,334(7) * Director
John A. Sindt 1,463,610(8) 6.9% Director
J. Steven Young 350,000(9) 1.7% Director
All officers and directors
as a group (6 persons) 2,764,497 12.92%
Northridge Investment, LLC
47 E. 7200 South, #221
Midvale, UT 84047 1,447,750(10) 6.9%
Jules A. deGreef
47 E. 7200 South, #201
Midvale, UT 84047 2,154,575(11) 9.96%
Aspen Capital Resources, LLC
8989 South Schofield Circle,
Sandy, Utah 84093 3,502,222(12) 14.9%
* Less than 1%.
_______________
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(1) Except where otherwise indicated, the address of the beneficial owner is
deemed to be the same address as Flexpoint Sensor Systems, Inc.
(2) Beneficial ownership is determined in accordance with SEC rules and
generally includes holding voting and investment power with respect to
the securities. Shares of common stock subject to options or warrants
currently exercisable, or exercisable within 60 days, are deemed
outstanding for computing the percentage of the total number of shares
beneficially owned by the designated person, but are not deemed
outstanding for computing the percentage for any other person.
(3) Flexpoint Sensor Systems, Inc. has common stock and Series A Convertible
Preferred Stock outstanding. The common stock and Series A Convertible
Preferred Stock vote as a single voting group, unless otherwise required
by law. The total outstanding Series A Convertible Stock comprises less
than five percent of the total outstanding voting securities. None of
the beneficial owners listed in the table above own shares of Series A
Convertible Preferred Stock. As a result, no information relating to the
Series A Preferred Stock is included in the table.
(4) Includes vested options to purchase 580,000 shares of common stock.
(5) Includes 37,553 shares of common stock. Also includes options to acquire
80,000 shares of common stock. Does not include options to acquire
40,000 shares of common stock that vest in July 2001.
(6) Includes options to acquire 80,000 shares of common stock. Does not
include options to acquire 40,000 shares of common stock that vest in
July 2001.
(7) Includes 33,334 shares of common stock. Also includes options to acquire
140,000 shares of common stock. Does not include options to acquire
40,000 shares of common stock that vests in equal installments in July
2001 and 2002.
(8) Includes 15,860 shares of common stock held by Mr. Sindt and 894,250
shares Mr. Sindt claims beneficial ownership of through an entity. Also
includes warrants to acquire 553,500 shares of common stock.
(9) Includes 350,000 shares of common stock.
(10) Includes 894,250 shares of common stock and warrants to acquire 553,500
shares of common stock.
(11) Includes 311,292 shares of common stock. Also includes 769,783 shares of
common stock that Mr. deGreef claims beneficial ownership of through his
membership interest in an entity and warrants and stock options to
acquire 1,073,500 shares of common stock.
(12) Includes 502,222 shares of common stock. Also includes convertible
debentures in the principal amount of $3,000,000 that are convertible
into common stock. This assumes conversion of the principal amount of
the debentures at $1.00 per share. The conversion price of these
debentures varies depending on the market price of the common stock. As
a result, the number of shares of common stock issuable upon conversion
of these debentures is an approximation and may differ materially from
the amount described. Does not include warrants exercisable for
2,315,494 shares of common stock that are not exercisable until November
15, 2000. Aspen Capital Resources, LLC has not filed a Form 3 or
Schedule 13D or 13G. The information presented for Aspen Capital
Resources, LLC in the table and this footnote is derived from the
Company's records, but there can be no assurance this information is
entirely accurate.
We are not aware of any arrangements, the operation of which may, at a
subsequent date, result in a change in control of Flexpoint Sensor Systems,
Inc.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officer, directors and persons who beneficially own more
than 10% of the Company's Common Stock to file initial reports of ownership
and reports of changes in ownership with the Securities and Exchange
Commission ("SEC"). Such persons are required by SEC regulations to furnish
the Company with copies of all Section 16(a) forms filed by such persons.
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Executive Compensation
The table below set forth certain information concerning compensation the
Company paid to its chief executive officer and all other executive officers
with annual compensation in excess of $100,000, determined for the year ended
December 31, 1999 (the "Named Executive Officers"). The table includes
information related to stock options granted to the Named Executive Officers.
<TABLE>
<CAPTION>
Summary Compensation Table
Annual Compensation Long Term Compensation Awards
------------------- ------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Securities
Restricted Underlying All Other
Name and Other Annual Stock Options/ LTIP Compensa-
Principal Position Year Salary($) Bonus($) Compensation($) Awards($) SAR's(#) Payouts($) tion($)
------------------ ---- --------- -------- --------------- ---------- ---------- ---------- ----------
Douglas M. Odom(1) 1997 120,000 - - - 515,000(2) - -
President, CEO 1998 120,000 10,000 - - - - -
and Director 1999 120,000 15,000 - - - - $1,275(3)
</TABLE>
______________
(1) The Summary Compensation Table reflects salary and bonus compensation
paid by Flexpoint, Inc. to Mr. Odom. Mr. Odom received no compensation
from Flexpoint Sensor Systems, Inc, Sensitron or Tamco during the
periods specified.
(2) Options to acquire 5,000 shares were exercised in October 1998 and
options to acquire 515,000 of said shares are currently exercisable.
(3) Represents terms life insurance premiums paid for the benefit of Mr.
Odom.
_______________
Compensation of Directors
Mr. Richard Wadley was compensated for service on the board of directors
through the grant of stock options to purchase 80,000 shares of common stock
which stock options are exercisable at $2.00 per share. Of these options,
twenty-five percent vested on the date of grant and the remaining options vest
in equal installments of twenty-five percent per year as long as Mr. Wadley is
a member of the board. Mr. Wadley was also entitled to compensation of $72,000
and options exercisable for 25,000 shares of common stock at $2.00 for
consulting services during 1999. In 2000, Mr. Wadley received stock options
exercisable for 20,000 shares of common stock and $24,000 for consulting
services. Mr. Jeff Coleman and Mr. Don Jackson were each granted options to
acquire 80,000 shares of common stock on the dates they were elected to the
board. These stock options vest in equal installments of twenty-five percent
per year beginning on the date of grant. J. Steven Young has been issued
350,000 shares of common stock for joining the board and acting as a
spokesperson and advisor to us. The other members of the board did not receive
any compensation for their service as directors. All directors are entitled to
reimbursement for reasonable expenses incurred in the performance of their
duties as board members. We have made no other agreements regarding
compensation of directors.
Employment Agreements
Effective December 31, 1997, Flexpoint, Inc. entered into an employment
agreement with Mr. Odom as its chief executive officer. Under the employment
agreement, Flexpoint, Inc. pays Mr. Odom an annual base salary of $120,000 per
year plus such discretionary bonus as the Flexpoint, Inc. board may deem
appropriate. The employment agreement has an initial term of three years and
will be automatically renewed successive one-year terms unless terminated by
either party. The employment agreement also provides Mr. Odom currently with
options to acquire 585,000 shares of common stock at an exercise price between
$.16 and $.77 per share under the Company's Omnibus Stock Option Plan. As of
December 31, 1999, options to acquire 515,000 shares of common
7
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stock were outstanding and exercisable. The Company does not have employment
agreements with any of its other employees.
Indemnification for Securities Act Liabilities
Delaware law authorizes, and the Company's Bylaws and indemnity
agreements provide for, indemnification of directors and officers against
claims, liabilities, amounts paid in settlement and expenses in a variety of
circumstances. Indemnification for liabilities arising under the Securities
Act of 1933 may be permitted for directors, officers and controlling persons
pursuant to the foregoing or otherwise. Insofar as indemnification for
liabilities arising under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons, the Company has been advised that
in the opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable.
Stock Options
The Company has adopted an Omnibus Stock Option Plan for the benefit of
our officers, directors, employees and consultants. The grant of options to
acquire an aggregate of 6,000,000 shares of common stock have been authorized
under the plan. The plan will permit the Company to grant "non-qualified stock
options" or "incentive stock options" to acquire shares of the Company's
common stock. The total number of shares authorized under the plan may be
allocated between the non-qualified stock options and the incentive stock
options from time to time, subject to limitations imposed by the Internal
Revenue Code of 1986, as amended. The plan is currently being administered by
the board, which will select optionees and determine the number of shares of
common stock subject to each option. The plan provides that no option which is
to be a qualified option may be granted at an exercise price less than the
fair market value of the common stock on the date of grant and in all cases
the term of the stock option shall not exceed ten years. Options to acquire
4,859,221 shares of common stock at exercise prices ranging from $.16 to $4.00
are presently outstanding under the plan.
Compensation Committee Interlocks and Insider Participation
None of the Company's executive officers serve on the compensation
committee, or in a like capacity, of Flexpoint Sensor Systems, Inc. or any
other entity.
2. Other Matters
Discretionary Authority
At the time of mailing of this proxy statement, the Board was not aware
of any other matters which might be presented at the meeting. If any matter
not described in this Proxy Statement should properly be presented, the
persons named in the accompanying proxy form will vote such proxy in
accordance with their judgment.
Independent Public Accountants
The Company retained Hansen Barnett & Maxwell ("HBM") as its independent
auditor for the current year. HBM has acted as the Company's independent
auditor since 1998. The Company expects representatives of HBM to be present
at the Company's 2000 Annual Meeting of Stockholders. HBM will have the
opportunity to make a statement at the annual meeting if it desires to do so
and it is expected that representatives of HBM will be available to respond to
appropriate questions if called upon to do so.
Notice Requirements
Any stockholder who desires to have a proposal included in the Company's
proxy soliciting material relating to the Company's 2001 annual meeting of
stockholders should send to the Secretary of the Company a signed notice of
intent. This notice, including the text of the proposal, must be received no
later than February 16, 2000.
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Annual Report
This Proxy Statement has been preceded or accompanied by an Annual Report
for the fiscal year ended December 31, 1999, and quarterly report on form
10-QSB for the period ended March 31, 2000. Stockholders are referred to such
reports for financial and other information about the activities of the
Company, but such reports are not to be deemed a part of the proxy soliciting
material.
Expenses and Methods of Solicitation
The expenses of soliciting proxies will be paid by the Company. In
addition to the use of the mails, proxies may be solicited personally, or by
telephone or other means of communications, by directors, officers and
employees of the Company and its subsidiaries, who will not receive additional
compensation therefor. Arrangements will also be made with brokerage firms and
other custodians, nominees and fiduciaries for the forwarding of proxy
solicitation material to certain beneficial owners of the Company's Common
Stock, and the Company will reimburse such forwarding parties for reasonable
expenses incurred by them.
By order of the Board of Directors,
By /s/ Douglas M. Odom
--------------------------------
President
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APPENDIX A
PROXY CARD
for
ANNUAL MEETING OF STOCKHOLDERS
of
FLEXPOINT SENSOR SYSTEMS, INC.
This Proxy is Solicited on Behalf of the Board Of Directors. The
undersigned hereby appoints Douglas M. Odom as Proxy, with the power to
appoint his substitute and hereby authorize them to represent and to vote, as
designated below, all the shares of common stock of Flexpoint Sensor Systems,
Inc. held on record by the undersigned on July 3, 2000 at the annual meeting
of stockholders to be held on August 29, 2000, or any adjournment thereof.
1. Election of Nominees for Director.
[ ] FOR Don Jackson (for term expiring at [ ] WITHHOLD AUTHORITY to vote for
2003 annual stockholder meeting) Don Jackson
[ ] FOR M. Richard Wadley (for term [ ] WITHHOLD AUTHORITY to vote for
expiring at 2002 annual stockholder M. Richard Wadley
meeting)
[ ] FOR John Sindt (for term expiring at [ ] WITHHOLD AUTHORITY to vote for
2001 annual stockholder meeting) John Sindt
[ ] FOR J. Steven Young (for term expiring [ ] WITHHOLD AUTHORITY to vote for
at 2001 annual stockholder meeting) J. Steven Young
This proxy when properly executed will be voted in the
manner directed herein by the undersigned stockholder(s).
If no directions are made, this proxy will be voted for
the above Proposals.
Please sign below. When shares are held by joint tenants, both should
sign. When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such. If a corporation, please sign in full
corporation name by President or other authorized officer. If a partnership,
please sign in partnership name by authorized person.
Dated: ____________, 2000 ____________________________________
(signature)
____________________________________
(signature if held jointly)
Please mark, sign, date and return
the proxy card promptly using the
enclosed envelope or proxy cards may
be sent by facsimile to Colonial
Stock Transfer at (801) 355-6505. ____________________________________
(print name of stockholder(s))
