SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by registrant [x] Filed by a party other than the
registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[x] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
GreenMan Technologies, Inc.
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(Name of Registrant as Specified in Its Charter)
GreenMan Technologies, Inc.
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(Name of Person[s] Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[x] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-
6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
Set forth the amount on which the filing fee is calculated and state how it was
determined.
[ ] 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:
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GREENMAN TECHNOLOGIES, INC.
7 KIMBALL LANE, BUILDING A
LYNNFIELD, MASSACHUSETTS 01940
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 7, 1996
TO THE STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of
GreenMan Technologies, Inc., a Delaware corporation (the "Company"), will be
held on Friday, June 7, 1996 at 10:00 a.m., local time, at the Company's
executive offices, 7 Kimball Lane, Building A, Lynnfield, Massachusetts 01940,
for the following purposes:
1. To approve an amendment to the Company's Certificate of
Incorporation to increase the number of authorized shares of
the Company's Common Stock from 10,000,000 to 20,000,000
shares.
2. To consider and act upon a proposal to increase the number of
shares of Common Stock authorized under the 1993 Stock Option
Plan to 1,000,000 shares.
3. To approve, consider and act upon a proposal to approve the
adoption of the 1996 Non- Employee Director Stock Option Plan.
4. To transact such other business as may properly come before
the Special Meeting and any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on May 3, 1996 are
entitled to notice of and to vote at the Special Meeting.
All stockholders are cordially invited to attend the Special Meeting in
person. However, to assure your representation at the Special Meeting, you are
urged to mark, sign, date and return the enclosed proxy card as promptly as
possible in the postage-prepaid envelope enclosed for that purpose. Any
stockholder attending the Special Meeting may vote in person even if he or she
has returned a proxy.
By Order of the Board of Directors
MAURICE E. NEEDHAM
Chief Executive Officer
May 6, 1996
IN ORDER TO ASSURE YOUR REPRESENTATION AT THE SPECIAL MEETING, YOU ARE
REQUESTED TO COMPLETE AND PROMPTLY RETURN THE ENCLOSED PROXY IN THE
ENVELOPE PROVIDED.
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GREENMAN TECHNOLOGIES, INC.
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PROXY STATEMENT FOR SPECIAL MEETING OF STOCKHOLDERS
The enclosed Proxy is solicited on behalf of GreenMan Technologies,
Inc. (the "Company") for use at the Special Meeting of Stockholders (the
"Special Meeting") to be held on Friday, June 7, 1996 at 10:00 a.m., local time,
and at any adjournment thereof, for the purposes set forth herein and in the
accompanying Notice of Special Meeting of Stockholders. The Special Meeting will
be held at the Company's executive offices, 7 Kimball Lane, Building A,
Lynnfield, Massachusetts 01940. The Company's telephone number is (617) 224-
2411.
These proxy solicitation materials were mailed on or about May 7, 1996
to all stockholders entitled to vote at the Special Meeting.
INFORMATION CONCERNING VOTING AND SOLICITATION
RECORD DATE AND SHARES OUTSTANDING
Only stockholders of record at the close of business on May 3, 1996
(the "Record Date") are entitled to notice of and to vote at the Special
Meeting. As of the Record Date, 5,066,083 shares of the Company's Common Stock
were issued and outstanding. No shares of Preferred Stock are outstanding.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the
person giving it at any time prior to its use by delivering to the Secretary of
the Company a written instrument revoking the proxy or a duly executed proxy
bearing a later date or by attending the Special Meeting and voting in person.
VOTING AND SOLICITATION
Each stockholder is entitled to one vote for each share of Common Stock
on all matters to be voted on by the stockholders. The affirmative vote of a
majority of the outstanding shares of Common Stock is required to approve each
of the matters scheduled to be voted on at the Special Meeting: the amendment of
the Company's Certificate of Incorporation to increase the number of authorized
shares of the Company's Common Stock from 10,000,000 to 20,000,000 shares (the
"Amendment"); the proposal to increase the number of shares reserved under the
1993 Stock Option Plan; and the proposal to approve the adoption of the 1996
Non-Employee Director Stock Option Plan.
Upon the execution and return of the enclosed form of proxy, the shares
represented thereby will be voted in accordance with the terms of the proxy,
unless the proxy is revoked. If no directions are indicated in such proxy, the
shares represented thereby will be voted "FOR" each of the proposals. For
purposes of each proposal, abstentions will have the same effect as votes
against the proposal; broker non-votes will have no effect on the outcome of the
vote.
The cost of soliciting proxies will be borne by the Company. The
Company may reimburse brokerage firms and other persons representing beneficial
owners of shares of their expenses in forwarding solicitation material to such
beneficial owners. Proxies may also be solicited by certain of the Company's
directors, officers and employees, without compensation, personally or by
telephone, telegram, letter or facsimile.
QUORUM; ABSTENTIONS; BROKER NON-VOTES
A majority of the outstanding shares of Common Stock entitled to vote
on the Record Date, whether present in person or represented by proxy, shall
constitute a quorum for the transaction of business at the Special Meeting or
any adjournment thereof. The Company intends to include abstentions and broker
non-votes as present or represented for purposes of establishing a quorum for
the transaction of business.
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SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of the Common Stock as of the Record Date of (i) each person known by
the Company to own beneficially 5% or more of the Common Stock, (ii) each
current director of the Company, (iii) the Company's Chief Executive Officer,
and (iv) all current directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY OWNED(2)
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NAME AND ADDRESS(1) NUMBER PERCENT
------------------- ------ -------
<S> <C> <C>
James F. Barker(3)...................................................... 377,300 7.39%
Maurice E. Needham(4)................................................... 361,000 7.07%
Joseph E. Levangie(5)................................................... 308,500 6.08%
Dhananjay G. Wadekar.................................................... 539,083 10.64%
Lew F. Boyd(6).......................................................... 20,000 *
Buster C. Glosson(7).................................................... 15,000 *
All officers and directors as a group
(5 persons) (3,4,5,6,7).............................................. 1,081,800 20.86%
</TABLE>
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* Less than 1% of the outstanding Common Stock.
(1) Each person's address is care of GreenMan Technologies, Inc.,
7 Kimball Lane, Building A, Lynnfield, Massachusetts 01940.
(2) Pursuant to the rules of the Securities and Exchange
Commission, shares of Common Stock that an individual or group
has a right to acquire within 60 days pursuant to the exercise
of options or warrants are deemed to be outstanding for the
purpose of computing the percentage ownership of such
individual or group, but are not deemed to be outstanding for
the purpose of computing the percentage ownership of any other
person shown in the table.
(3) Includes 36,000 shares of Common Stock issuable pursuant to
immediately exercisable stock options and 3,000 shares of
Common Stock issuable pursuant to immediately exercisable
stock options owned by Mr. Barker's wife. Does not include
2,000 shares of Common Stock issuable pursuant to stock
options owned by Mr. Barker's wife that are not immediately
exercisable and 137,700 shares owned by Cynthia M. Barker, Mr.
Barker's adult daughter, as to which he disclaims beneficial
ownership. Also does not include 24,000 shares of Common Stock
issuable pursuant to outstanding stock options that are not
currently exercisable.
(4) Includes 36,000 shares of Common Stock issuable pursuant to
immediately exercisable stock options. Also includes 20,000
shares of Common Stock owned by Mr. Needham's wife. Does not
include 24,000 shares of Common Stock issuable pursuant to
outstanding stock options that are not currently exercisable
and 60,000 shares owned by Mr. Needham's adult children, as to
which he disclaims beneficial ownership.
(5) Includes 8,500 shares of Common Stock issuable pursuant to
immediately exercisable stock options. Does not include 4,000
shares of Common Stock issuable pursuant to outstanding stock
options that are not currently exercisable.
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(6) Includes 20,000 shares of Common Stock issuable pursuant to
immediately exercisable options. Does not include 15,000
shares of Common Stock issuable pursuant to outstanding stock
options that are not currently exercisable.
(7) Includes 15,000 shares of Common Stock issuable pursuant to
immediately exercisable stock options. Does not include 20,000
shares of Common Stock issuable pursuant to outstanding stock
options that are not currently exercisable.
PROPOSAL TO INCREASE AUTHORIZED SHARES OF COMMON STOCK
The Board of Directors has resolved to recommend to the stockholders
that the Company amend the Company's Certificate of Incorporation to increase
the number of authorized shares of Common Stock from 10,000,000 to 20,000,000
shares. Shares of the Company's Common Stock, including the additional shares
proposed for authorization, do not have preemptive or similar rights.
If this proposal is approved and after giving effect to shares reserved
for issuance under the Company's stock plans, and shares reserved for issuance
upon the exercise of outstanding warrants, options and other commitments, the
Board of Directors will have the authority to issue approximately an additional
10,000,000 (as of May 3, 1996) shares of Common Stock without further
stockholder approval. The Board of Directors of the Company believes that the
increase in the number of authorized shares of Common Stock is in the best
interests of the Company and its stockholders. The Board of Directors believes
that the authorized Common Stock should be increased to provide sufficient
shares for such corporate purposes as may be determined by the Board of
Directors to be necessary or desirable. These purposes may include facilitating
broader ownership of the Company's Common Stock by effecting a stock split or
issuing a stock dividend, raising capital or acquiring technology rights through
the sale of stock, or attracting or retaining valuable employees by the issuance
of stock options. Except for plans to issue stock options as described below,
the Company at present has no commitments, agreements or undertakings obligating
the Company to issue any such additional shares. The Board of Directors,
however, considers the authorization of additional shares of Common Stock
advisable to ensure prompt availability of shares for issuance should the
occasion arise.
The Company currently has no intention of issuing any Common Stock
other than pursuant to its stock plans. However, the Company intends to reserve
certain of the shares made available by the increase in the authorized Common
Stock for issuance upon exercise of stock options to be granted to officers,
directors, and employees of the Company. The Company currently plans to increase
the number of authorized shares under its 1993 Stock Plan from 410,000 to
1,000,000 shares and has reserved 300,000 shares for issuance under the 1995
Non-Executive Director Stock Option Plan.
Under the Delaware General Corporation Law, the Board of Directors
generally may issue authorized but unissued shares of Common Stock without
further stockholder approval. The Board of Directors does not currently intend
to seek stockholder approval prior to any future issuance of additional shares
of Common Stock, unless stockholder action is required in a specific case by
applicable law, the rules of any exchange or market on which the Company's
securities may then be listed, or the Charter or By-Laws of the Company then in
effect. Frequently, opportunities arise that require prompt action, and the
Company believes that delay necessitated for stockholder approval of a specific
issuance could be to the detriment of the Company and its stockholders.
The Board of Directors believes that the increase in the number of
authorized shares of undesignated Common Stock is in the best interests of the
Company and its stockholders, since the complexity of modern business financing
requires greater flexibility in the Company's capital structure than now exists.
The additional Common Stock to be authorized would be available for issuance
from time to time for any proper corporate purpose, including public or private
sale for cash as a means of obtaining capital for use in the Company's business
or for the acquisition by the Company of other businesses or assets. The Board
of Directors believes
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that having additional shares of Common Stock will provide the flexibility and
facility for finding financing sources and quickly consummating any such
transaction. Additionally, from time to time, the Company is involved in various
discussions with other companies relating to the acquisition of complementary
products or services, or other forms of business combinations involving the
Company. However, the Company has no present commitments or agreements relating
to any potential acquisitions or financings. The Board of Directors, however,
considers the authorization of such additional shares advisable to ensure prompt
availability of shares for issuance should the occasion arise.
The additional shares of Common Stock authorized for issuance pursuant
to this proposal will have all of the rights and privileges which the presently
outstanding shares of Common Stock possess under the Company's Charter. The
increase in authorized shares would not affect the terms or rights of holders of
existing shares of Common Stock. The rights of the holders of Common Stock,
however, are subordinate to the rights of the holders of the Preferred Stock in
certain instances. All outstanding shares of Common Stock would continue to have
one vote per share on all matters to be voted on by the stockholders, including
the election of directors.
The issuance of any additional shares of Common Stock by the Company
may, depending on the circumstances under which those shares are issued, reduce
stockholders' equity per share and may reduce the percentage ownership of Common
Stock of existing stockholders. The Company expects, however, to receive
consideration for any additional shares of Common Stock issues, thereby reducing
or eliminating the economic effect to each stockholder of such dilution.
The authorized but unissued shares of Common Stock could be used to
make more difficult a change in control of the Company. For example, such shares
could be sold to purchasers who might side with the Board of Directors in
opposing a takeover bid that the Board determines not to be in the best
interests of the Company and its stockholders. Such a sale could have the effect
of discouraging an attempt by another person or entity, through the acquisition
of a substantial number of shares of the Company's Common Stock, to acquire
control of the Company, since the issuance of new shares could be used to dilute
the stock ownership of the acquirer. Neither the Charter nor By-Laws of the
Company now contain any provisions that are generally considered to have an
anti-takeover effect, and the Board of Directors does not now plan to propose
any anti-takeover measures in future proxy solicitations. The Company is not
aware of any pending or threatened efforts to obtain control of the Company, and
the Board of Directors has no current intention to use the additional shares of
Common Stock to impede a takeover attempt.
Approval of the amendment to increase the number of authorized shares
of Common Stock will require the affirmative vote of the holders of a majority
of the outstanding shares of Common Stock of the Company represented in person
or by proxy and entitled to vote at the Meeting. Abstentions will have the same
effect as a vote against the proposal; broker non-votes will have no outcome on
the vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE
AMENDMENT TO THE COMPANY'S CHARTER TO INCREASE THE NUMBER OF AUTHORIZED SHARES
OF COMMON STOCK FROM 10,000,000 TO 20,000,000 SHARES.
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PROPOSAL TO INCREASE THE NUMBER OF SHARES
RESERVED UNDER THE 1993 PLAN
The 1993 Plan was adopted by the Company's Board of Directors on June
10, 1993 and approved by the Company's stockholders on June 10, 1993. A maximum
of 410,000 shares of Common Stock were originally reserved for issuance under
the 1993 Plan upon the exercise of options. The Board of Directors has approved
and recommended to the stockholders that they approve an amendment to increase
the number of shares authorized for issuance pursuant to the 1993 Plan to
1,000,000 shares, an increase of 590,000 shares.
Since June 10, 1993, when the 1993 Plan was originally approved, the
number of employees at the Company has increased from approximately 60 to
approximately 100 persons. The Company's management relies on stock options as
an essential part of the compensation packages necessary for the Company to
attract and retain experienced officers and employees. The Board of Directors of
the Company believes that the proposed increase in the number of shares
available under the 1993 Plan is essential to permit the Company's management to
continue to provide long-term, equity-based incentives to present and future
employees.
In 1995, the Company granted options under the 1993 Plan with
fair-market-value exercise prices as follows: to all current executive officers
as a group, 2,500 shares; and to all non-executive officer employees, net of
cancellations, 6,000 shares.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE
PROPOSAL TO AMEND THE COMPANY'S 1993 PLAN TO INCREASE FROM 410,000 TO 1,000,000
THE NUMBER OF SHARES AUTHORIZED FOR ISSUANCE UNDER THE 1993 PLAN.
DESCRIPTION OF THE 1993 PLAN
Purpose. The purpose of the 1993 Plan is to provide incentives to
officers and other employees of the Company by providing them with opportunities
to purchase stock of the Company.
Shares Subject to the 1993 Plan. As of May 3, 1996, the aggregate
market value of shares of Common Stock issuable pursuant to outstanding options
under the 1993 Plan was $1,722,187.50 based upon the average of the bid-and-ask
prices as quoted on the Nasdaq SmallCap Market at the close of trading on that
date.
Eligibility. Under the 1993 Plan, employees (including officers) of the
Company may be awarded incentive stock options ("ISO" or "ISOs"), as defined in
Section 422(b) of the Code, and directors, employees (including officers) and
consultants of the Company may be granted options which do not qualify as ISOs
("Non- Qualified Option" or "Non-Qualified Options"). ISOs and Non-Qualified
Options are sometimes collectively referred to as "Options."
Administration. The 1993 Plan is administered by the Board of Directors
of the Company. Subject to the terms of the 1993 Plan, the Board has the
authority to determine the persons to whom Options are granted, the number of
shares covered by each Option, the exercise price per share and other terms and
provisions governing the Options.
Option Price and Duration. The exercise price per share of
Non-Qualified Options granted under the 1993 Plan cannot be less than
eighty-five percent (85%) of the fair-market value of the stock subject to the
option on the date the option is granted. The exercise price per share of ISOs
cannot be less than the fair-market value of the Common Stock on the date of
grant (or, in the case of ISOs granted to employees holding more than 10% of the
voting stock of the Company, one hundred ten percent (110%) of the fair-market
value of the Common Stock on the date of grant). The 1993 Plan provides that
each option shall expire on the date specified by the
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Committee, but not more than ten years from its date of grant and five years in
the case of ISOs granted to an employee or officer holding more than ten percent
(10%) of the voting stock of the Company.
Exercise of Options. Each Option granted under the 1993 Plan may either
be fully exercisable at the time of grant or may become exercisable in such
installments as the Board may specify. Each Option may be exercised from time to
time, in whole or in part, up to the total number of shares with respect to
which it is then exercisable. The Board has the right to accelerate the date of
exercise of any installment of any option (subject to the $100,000-per-year
limitation on the fair-market value of stock subject to ISOs granted to any
employee which become exercisable in any calendar year).
Payment of Stock. Payment of the exercise price of an option granted
under the 1993 Plan may be made (i) in cash; (ii) by tendering Common Stock of
the Company; (iii) according to a deferred payment arrangement; or (iv) in any
other form of legal consideration as provided by the terms of the option
agreement. The 1993 Plan contains terms providing for the exercise of options by
or on behalf of former and deceased employees, respectively, as described below.
Non-Assignability of Options. Only the optionee may exercise an option;
no assignment or transfers are permitted except by will or by the laws of
descent and distribution.
Termination of Option Rights. If an ISO optionee ceases to be employed
by the Company other than by reason of death or disability, no further
installments of his or her ISOs will become exercisable, and the ISOs shall
terminate after the passage of 30 days from the date of termination of
employment. If an optionee is disabled, any ISO held by the optionee may be
exercised, to the extent exercisable on the date of disability, by the optionee
at any time within one year from the date of the optionee's disability. If an
optionee dies, any ISO held by the optionee may be exercised, to the extent
exercisable on the date of death, by the optionee at any time within eighteen
(18) months following death of the optionee by the optionee's estate or by
persons to whom the optionee's rights under such option pass by will or by the
laws of descent and distribution. Non-Qualified Options are subject to such
termination and cancellation provisions as may be determined by the Committee.
Changes in Capitalization and Other Matters. Option holders are
protected against dilution in the event of a stock dividend, recapitalization,
stock split, merger or similar transaction. The Board of Directors may from time
to time adopt amendments to the 1993 Plan, certain of which are subject to
stockholder approval, and may terminate the 1993 Plan, at any time (although
such action shall not affect options previously granted). Any shares subject to
an option granted under the 1993 Plan, which for any reason expire or terminate
unexercised, may again be available for future option grants. Unless terminated
sooner, the 1993 Plan will terminate on June 10, 2003, and options may be
granted under the 1993 Plan at any time prior to this date.
FEDERAL TAX CONSIDERATIONS
The following general rules are applicable under current federal income
tax law to ISOs under the 1993 Plan:
1. In general, no taxable income results to the optionee upon
the grant of an ISO or upon the issuance of shares to him or her upon
the exercise of the ISO, and no tax deduction is allowed to the Company
upon either grant or exercise of an ISO.
2. If shares acquired upon exercise of an ISO are not disposed
of within (i) two years following the date the option was granted or
(ii) one year following the date the shares are issued to the optionee
pursuant to the ISO exercise, the difference between the amount
realized on any subsequent disposition of the shares and the exercise
price will generally be treated as capital gain or loss to the
optionee.
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3. If shares acquired upon exercise of an ISO are disposed of
before the expiration of one or both of the requisite holding periods
(a "Disqualifying Disposition"), then in most cases the lesser of (i)
any excess of the fair-market value of the shares at the time of
exercise of the ISO over the exercise price or (ii) the actual gain on
disposition will be treated as compensation to the optionee and will be
taxed as ordinary income in the year of such disposition.
4. In any year that an optionee recognizes compensation income
on a Disqualifying Disposition of stock acquired by exercising an ISO,
the Company generally should be entitled to a corresponding deduction
for income tax purposes.
5. Any excess of the amount realized by the optionee as the
result of a Disqualifying Disposition over the sum of (i) the exercise
price and (ii) the amount of ordinary income recognized under the above
rules will be treated as capital gain.
6. Capital gain or loss recognized on a disposition of shares
will be long-term capital gain or loss if the optionee's holding period
for the shares exceeds one year.
7. An optionee may be entitled to exercise an ISO by
delivering shares of the Company's Common Stock to the Company in
payment of the exercise price, if the optionee's ISO agreement so
provides. If an optionee exercises an ISO in such a manner, special
rules will apply.
8. In addition to the tax consequences described above, the
exercise of ISOs may result in a further "minimum tax" under the Code.
The Code provides that an "alternative minimum tax" (at a rate of 26%
or 28%) will be applied against a taxable base which is equal to
"alternative minimum taxable income," reduced by a statutory exemption.
In general, the amount by which the value of the Common Stock received
upon exercise of the ISO exceeds the exercise price is included in the
optionee's alternative minimum taxable income. A taxpayer is required
to pay the higher of his regular tax liability or the alternative
minimum tax. A taxpayer who pays alternative minimum tax attributable
to the exercise of an ISO may be entitled to a tax credit against his
or her regular tax liability in later years.
The following general rules are applicable under current federal income
tax law to Non-Qualified Options under the 1993 Plan:
1. The optionee generally does not realize any taxable income
upon the grant of an option, and the Company is not allowed a business
expense deduction by reason of such grant.
2. The optionee generally will recognize ordinary compensation
income at the time of exercise of the option in an amount equal to the
excess, if any, of the fair-market value of the shares on the date of
exercise over the exercise price.
3. When the optionee sells the shares, he or she generally
will recognize a capital gain or loss in an amount equal to the
difference between the amount realized upon the sale of the shares and
his or her basis in the stock (generally, the exercise price plus the
amount taxed to the optionee as compensation income). If the optionee's
holding period for the shares exceeds one year, such gain or loss will
be a long-term capital gain or loss.
4. The Company generally should be entitled to a tax deduction
when compensation income is recognized by the optionee.
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5. An optionee may be entitled to exercise a non-qualified
option by delivering shares of the Company's Common Stock to the
Company in payment of the exercise price. If an optionee exercises a
non-qualified option in such fashion, special rules will apply.
PROPOSAL TO APPROVE THE 1996 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
On January 24, 1996, the Board of Directors of the Company adopted the
1996 Non-Employee Director Stock Option Plan (the "1996 Director Plan"), subject
to approval by the Company's stockholders. As of January 24, 1996, two members
of the Board of Directors were entitled to participate in the 1996 Director
Plan. On January 24, 1996, Messrs. Boyd and Glosson were each automatically
granted an option to purchase 10,000 shares of Common Stock with fair-market
value exercise prices as of such date.
DESCRIPTION OF THE 1996 DIRECTOR PLAN
Purpose. The purpose of the 1996 Director Plan is to promote the
interests of the Company by providing an inducement to obtain and retain the
services of qualified persons who are not employees or officers of the Company
to serve as members of its Board of Directors.
Administration. The 1996 Director Plan is administered by the Board of
Directors of the Company. The Board of Directors, subject to the provisions of
the 1996 Director Plan, has the power to construe the 1996 Director Plan, to
determine all questions thereunder, and to adopt and amend such rules and
regulations for the administration of the 1996 Director Plan as it may deem
desirable.
Shares Subject to the 1996 Director Plan. The 1996 Director Plan
authorizes the grant of options for up to 300,000 shares of Common Stock,
280,000 of which remain available for grant as of the date hereof. Outstanding
options under the 1996 Director Plan are subject to adjustment for capital
changes. If any options granted under the 1996 Director Plan are surrendered
before exercise or lapse without exercise, in whole or in part, the shares
reserved therefor shall continue to be available under the 1996 Director Plan.
As of May 3, 1996, the aggregate market value of shares of Common Stock issuable
pursuant to outstanding options under the 1996 Director Plan was $82,500 based
upon the average of the bid-and-ask prices as quoted on the Nasdaq SmallCap
market at the close of trading on that date.
Eligibility; Automatic Grant of Options under the 1996 Director Plan.
Each person who was a member of the Company's Board of Directors on January 24,
1996, and who was not an employee or an officer of the Company, was
automatically granted on such date an option to purchase 10,000 shares of the
Company's Common Stock. Each person who is neither an employee nor an officer of
the Company who is first elected a member of the Board of Directors after
January 24, 1996 will automatically be granted, on the date of such election, an
option to purchase 10,000 shares of the Company's Common Stock. In addition,
after the person's initial election to the Board, any director who is neither an
employee nor an officer of the Company who continues to serve as a director will
automatically be granted on the date of the Annual Meeting of Stockholders an
additional option to purchase 10,000 shares of the Company's Common Stock.
Anything in the 1996 Director Plan to the contrary notwithstanding, the
effectiveness of the 1996 Director Plan and of the grant of all options
thereunder is in all respects subject to the approval of the 1996 Director Plan
by the affirmative vote of holders of a majority of the shares of the Company's
Common Stock present in person or by proxy and entitled to vote at a meeting of
stockholders at which the 1996 Director Plan is presented for approval.
Option Price. The exercise price per share of options granted under the
1996 Director Plan is 100% of the fair-market value of the Company's Common
Stock on the business day immediately prior to the date the option is granted.
The Option Price is subject to adjustment as described in "Changes in
Capitalization and Other Matters" below.
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Option Duration. The 1996 Director Plan requires that options granted
thereunder will expire on the date which is ten years from the date of grant.
Vesting of Shares. Each option granted under the 1996 Director Plan is
immediately exercisable with respect to all of the shares subject to such option
on the date of the grant.
Exercise of Options and Payment for Stock. Subject to the terms and
conditions of the 1996 Director Plan, an option granted under the 1996 Director
Plan shall be exercisable in whole or in part by giving written notice to the
Company at its principal executive offices. The notice must state the number of
shares as to which the option is being exercised and must be accompanied by
payment in full for such shares.
Termination of Option Rights. In the event an optionee ceases to be a
member of the Board of Directors of the Company for any reason other than death
or permanent disability, any then-unexercised options granted to such optionee
shall, to the extent not then vested, immediately terminate and become void, and
any options which are then vested but have not been exercised may be exercised
by the optionee until the scheduled termination date of the option.
In the event that an optionee ceases to be a member of the Board of
Directors of the Company by reason of his or her permanent disability or death,
any option granted to such optionee shall be immediately and automatically
accelerated and become fully vested and all unexercised options shall be
exercisable by the optionee (or by the optionee's personal representative, heir
or legatee) until the scheduled expiration date of the option.
Non-Assignability of Options. Any option granted pursuant to the 1996
Director Plan is not assignable or transferable other than by will or by the
laws of descent and distribution or pursuant to a domestic relations order, and
is exercisable during the optionee's lifetime only by him or her.
Changes in Capitalization and Other Matters. Option holders are
protected against dilution in the event of a stock dividend, recapitalization,
stock split, merger or similar transaction. Upon the happening of any of the
foregoing events, the class and aggregate number of shares reserved for issuance
upon the exercise of options under the 1996 Director Plan shall also be
appropriately adjusted to reflect the events described above.
Termination and Amendment of the 1996 Director Plan. The Board of
Directors may from time to time adopt amendments, certain of which are subject
to stockholder approval, and may terminate the 1996 Director Plan at any time
(although such action shall not affect options previously granted).
Federal Tax Considerations. The following discussion summarizes certain
federal income tax considerations for Directors receiving options under the 1996
Director Plan and certain tax effects on the Company. However, the summary does
not address every situation that may result in taxation. For example, it does
not address the tax implications arising from a Director's death. Furthermore,
there are likely to be federal self-employment tax and state income tax
consequences which are not discussed herein. This summary is not intended as a
substitute for careful tax planning, and each Director is urged to consult with
and rely on his or her own advisors with respect to the possible tax
consequences (federal, state and local) of exercising his or her rights under
the 1996 Director Plan. The 1996 Director Plan is not subject to the provisions
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
and the provisions of Section 401(a) of the Code are not applicable to the 1996
Director Plan.
1. Options granted under the 1996 Director Plan do not qualify as
"Incentive Stock Options" under Section 422 of the Code.
2. A Director will not recognize any taxable income upon the grant of
an option under the 1996 Director Plan, but will generally recognize ordinary
compensation income at the time of exercise of the option
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<PAGE>
in an amount equal to the excess, if any, of the fair-market value of the shares
on the date of exercise over the exercise price.
3. When a Director sells the Common Stock acquired upon exercise of an
option, he or she generally will recognize a capital gain or loss equal to the
difference between the amount realized upon sale of the stock and his or her
basis in the stock (in the case of a cash exercise, the exercise price plus the
amount, if any, taxed to the Director as compensation income as a result of his
or her exercise of the option. If the Director's holding period for the stock
exceeds one year, the gain or loss will be long-term capital gain or loss.
4. No tax deduction will be allowed to the Company upon grant of an
option under the 1996 Director Plan. When a director recognizes compensation
income as a result of the exercise of an option under the 1996 Director Plan,
the Company generally will be entitled to a corresponding deduction for income
tax purposes.
APPROVAL OF THE 1996 DIRECTOR PLAN WILL REQUIRE AFFIRMATIVE VOTE OF A
MAJORITY OF THE OUTSTANDING SHARES OF COMMON STOCK OF THE COMPANY REPRESENTED IN
PERSON OR BY PROXY AT THE ANNUAL MEETING. THE BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE APPROVAL OF THE 1996 DIRECTOR PLAN.
TRANSACTION OF OTHER BUSINESS
The Board of Directors of the Company knows of no other matters which
may be brought before the Special Meeting. If any other matters properly come
before the Special Meeting, or any adjournment thereof, it is the intention of
the persons named in the accompanying form of Proxy to vote the Proxy on such
matters in accordance with their best judgment.
BY ORDER OF THE BOARD OF DIRECTORS
Lynnfield, Massachusetts
May 6, 1996
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<PAGE>
EXHIBIT A
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
GREENMAN TECHNOLOGIES, INC.
GreenMan Technologies, Inc., a corporation organized and existing under
the laws of the State of Delaware (the "Corporation"), pursuant to the
provisions of the General Corporation Law of the State of Delaware (the "DGCL"),
DOES HEREBY CERTIFY as follows:
FIRST: The Certificate of Incorporation of the Corporation is hereby
amended by deleting the first paragraph of Section 4 of the Certificate of
Incorporation in its present form and substituting therefor new first and second
paragraphs of Section 4 in the following form:
A. This corporation is authorized to issue two classes of
stock, to be designated, respectively, "Common Stock" and "Preferred
Stock." The total number of shares this corporation is authorized to
issue is Twenty-One Million (21,000,000) shares of capital stock.
B. Of such authorized shares, Twenty Million (20,000,000)
shares shall be designated "Common Stock" and have a par value of $0.01
per share. One Million (1,000,000) shares shall be designated
"Preferred Stock" and have a par value of $1.00 per share.
SECOND: The amendment to the Certificate of Incorporation of the
Corporation set forth in this Certificate of Amendment has been duly adopted in
accordance with the provisions of Section 242 of the DGCL by (a) the Board of
Directors of the Corporation having duly adopted a resolution setting forth such
amendment and declaring its advisability and submitting it to the stockholders
of the Corporation for their approval, and (b) the stockholders of the
Corporation having duly adopted such amendment by vote of the holders of a
majority of the outstanding stock entitled to vote thereon at a special meeting
of stockholders called and held upon notice in accordance with Section 222 of
the DGCL.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to be
hereunto affixed and this Certificate of Amendment to be signed by Maurice E.
Needham, its Chief Executive Officer, and attested to by Joseph E. Levangie, its
Secretary, this _____ day of June, 1996.
GREENMAN TECHNOLOGIES, INC.
By:____________________________
Maurice E. Needham
Chief Executive Officer
ATTEST:
- - ---------------------------------------
Joseph E. Levangie
Secretary
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<PAGE>
SOLICITED BY THE BOARD OF DIRECTORS
GREENMAN TECHNOLOGIES, INC.
SPECIAL MEETING OF STOCKHOLDERS
JUNE 7, 1996
The undersigned stockholder of GreenMan Technologies, Inc. (the "Company")
hereby appoints Maurice E. Needham and Joseph E. Levangie, and each of them
acting singly, with power of substitution, the attorneys and proxies of the
undersigned and authorizes them to represent and vote on behalf of the
undersigned, as designated, all of the shares of capital stock of the Company
that the undersigned is entitled to vote at the Special Meeting of Stockholders
of the Company to be held on June 7, 1996, and at any adjournment or
postponement of such meeting for the purposes identified on the reverse side of
this proxy and with discretionary authority as to any other matters that
properly come before the Special Meeting, in accordance with and as described in
the Notice of Special Meeting of Stockholders and Proxy Statement. This proxy
when properly executed will be voted in the manner directed herein by the
undersigned stockholder. If this proxy is returned without direction being
given, this proxy will be voted FOR proposals 1, 2 and 3. The Board of Directors
recommends a vote FOR proposals 1, 2 and 3.
(1) Approve an amendment to the Company's Certificate of Incorporation
increasing the authorized shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(2) Approve an increase in the number of shares of Common Stock authorized under
the 1993 Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(3) Approve the adoption of the 1996 Non-Employee Director Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(IMPORTANT -- TO BE SIGNED AND DATED ON REVERSE SIDE)
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
Signature
------------------------------------
Date: , 1996
----------------------------------
Signature
------------------------------------
Date: , 1996
----------------------------------
Please sign exactly as your name appears on
stock certificate. If acting as attorney,
executor, trustee, guardian or in other
representative capacity, sign name and title.
If a corporation, please sign in full
corporate name by the President or other
authorized officer. If a partnership, please
sign in partnership name by authorized person.
If held jointly, both parties must sign and
date.
