SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
ITRONICS INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check Appropriate Box):
(X) No fee required.
( ) 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.
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(2) Aggregate number of securities to which transaction applies.
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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IMPORTANT NOTE:
ITRONICS INC. IS NOT CURRENTLY SUBJECT TO THE PROXY
SOLICITATION RULES OF THE SECURITIES AND EXCHANGE
COMMISSION. ACCORDINGLY, WHILE THIS PROXY STATEMENT
GENERALLY FOLLOWS THE RULES AND REGULATIONS OF THE
SECURITIES AND EXCHANGE COMMISSION, THIS PROXY STATE-
MENT DOES NOT NECESSARILY PROVIDE THE SAME INFORMATION
REQUIRED TO BE DISCLOSED UNDER THE PROXY SOLICITATION
RULES AND REGULATIONS. IN ADDITION THIS PROXY STATEMENT
HAS NOT BEEN REVIEWED BY THE SECURITIES AND EXCHANGE
COMMISSION WHICH MAY HAVE BEEN REQUIRED IF ITRONICS INC.
WAS SUBJECT TO THE PROXY SOLICITATION RULES.
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ITRONICS INC.
6490 So. McCarran Blvd., Bldg. C-23
Reno, Nevada 89509
(702) 689-7696
___________________________________
PROXY STATEMENT
Annual Meeting of Shareholders
November 19, 1997
___________________________________
INFORMATION RELATING TO VOTING AT THE ANNUAL MEETING
----------------------------------------------------
This proxy statement is being furnished to shareholders of Itronics
Inc. (the Company), in connection with the solicitation of proxies by the
Company's Board of Directors for use at the Annual Meeting to be held at the
Airport Plaza Hotel, Reno, Nevada on November 19, 1997 at 10:00 A.M. Pacific
time, and at any adjournment or adjournments thereof. The approximate date of
mailing of this proxy statement and the accompanying form of proxy is November
4, 1997.
The Board of Directors of the Company has selected October 20, 1997
as the record date for the determination of shareholders entitled to notice
of and to vote at the Annual Meeting. A total of 40,266,387 shares of the
Company's common stock were of record at the close of business on that date.
Shareholders will be entitled to cast one vote for each share of the Company's
common stock held by them of record at the close of business on the record
date on any matter that may be presented at the Annual Meeting for
consideration and action by the shareholders. Shareholders do not have
cumulative voting rights with respect to the election of directors.
All valid proxies received in response to the solicitation will be
voted in accordance with the instructions indicated thereon by the
shareholders giving such proxies. If no contrary instructions are given, each
such proxy will be voted in favor of: (i) the election of the director
nominees named in this proxy statement; and (ii) the proposal to amend the
articles of incorporation of the Company to increase the authorized shares of
common stock to 250,000,000.
The Board of Directors does not know of any business to be presented
for action at the Annual Meeting other than that described herein. If any
other business is properly presented at the Annual Meeting and may be properly
voted upon, the proxies solicited hereby will be voted on such matters in
accordance with the best judgement of the proxy holders named therein.
1
Any shareholder has the power to revoke his proxy at any time before
it is voted at the Annual Meeting by giving written notice of such revocation
to the Secretary of the Company (which notice shall be given by the filing of
a duly executed proxy bearing a later date) or by attending the Annual Meeting
and voting in person. Proxies solicited by the Company's Board of Directors
hereby are for use solely at the Annual Meeting and any adjournment or
adjournments thereof.
The expenses of this proxy solicitation will be borne by the Company.
To the extent necessary, proxies may be solicited by personnel of the Company
in person, by telephone, or through other forms of communication. Personnel
of the Company who participate in the solicitation will not receive any
additional compensation for such solicitation. The Company will request
record holders of shares beneficially owned by others to forward this proxy
statement and related materials to the beneficial owners of such shares and
will reimburse such record holders for their reasonable expenses incurred in
doing so.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL
OF THE PROPOSALS SET FORTH IN THIS PROXY STATEMENT.
Security Ownership of Certain Beneficial Owners
- -----------------------------------------------
The following table sets forth certain data with respect to those
persons known to the Company, as of October 20, 1997, to be the beneficial
owners of more than 5% of the outstanding shares of common stock of the
Company.
Amount and Nature of Beneficial Ownership
-----------------------------------------
Common Shares
Name and Which May Be Percent
Address of Common Shares Acquired Within of
Beneficial Owner Presently Held 60 days(4) Total Class
- -------------------- --------------- ---------------- ---------- --------
John W. Whitney
P.O. Box 10725
Reno, NV 89510 12,420,192(3) 1,475,000 13,895,192 33.29
(1)(2)
Richard J. Cavell
1013 No. Marshall Dr.
Camano Island, WA 4,577,876 540,473 5,118,349 12.54
(1) Director
(2) Officer
(3) Includes 75,136 shares owned by or to be issued to John B.
Whitney, Dr. John W. Whitney's minor son, 71,632 shares owned
by Maureen E. Whitney, Dr. Whitney's wife, and 2,101,424 shares
paid for but unissued as of October 20, 1997.
(4) All options of Drs. Whitney and Cavell are priced at $.10
per share.
2
Security Ownership of Management
- --------------------------------
The following table sets forth as of October 20, 1997, certain
information, with respect to director and executive officer ownership of
common stock in the Company:
Amount and Nature of Beneficial Ownership
-----------------------------------------
Common Shares Percent
Name and Which May Be of
Address of Common Shares Acquired Within Class
Beneficial Owner Presently Held 60 days(1) Total (2)
- -------------------- --------------- --------------- ---------- ---------
Dr. John W. Whitney
P.O. Box 10725
Reno, NV 89510 12,420,192(5) 1,475,000 13,895,192 33.29
(3)(4)
Paul H. Durckel
1511 Main St.
Gardnerville, NV. 89410 138,500 50,000 188,500 .47
(3)
Richard W. Stumbo, Jr.
P.O. Box 10725
Reno, NV 89510 107,127 0 107,127 .27
(3) (4)
Alan C. Lewin
P.O. Box 10725
Reno, Nv 89510 107,500 50,000 157,500 .39
(3)
All directors and
executive officers as a
group (7 persons) 14,782,102 1,825,000 16,607,102 39.45
(1) All options, warrants and debt conversion rights listed in the above
table are at $.10 per share, with the exception of 100,000 shares
which are at the higher of $.10 per share or current high bid.
(2) The percent of class is based on the sum of 40,266,387 shares
outstanding or to be issued as of October 20, 1997 plus, for each
individual, the number of common shares as to which the named
individual has the right to acquire beneficial ownership within 60
days of October 20, 1997.
(3) Director
(4) Officer
(5) Includes 75,136 shares owned by or to be issued to John B. Whitney,
Dr. John W. Whitney's minor son, and 71,632 shares owned by Maureen
B. Whitney, Dr. Whitney's wife, and 2,101,424 shares paid for but
unissued as of October 20, 1997.
3
Compliance With Section 16(a) of the 1934 Act
- ---------------------------------------------
The Company is not presently subject to the requirements of Section
16(a) of the Securities Act.
ELECTION OF DIRECTORS
Proposal 1
The Company's bylaws provide that the Board of Directors shall
consist of one to nine members. There are presently four directors.
Each of the nominees listed below is currently a director of the
Company. Each nominee has consented to being named in this Proxy Statement
and has indicated his willingness to serve, if reelected. If any nominee
becomes unable to serve, however, the proxy solicited hereby will be voted
for the election of such other person or persons as the Board of Directors
shall elect.
The following table sets forth the names of and certain information
concerning the nominees to the Board of Directors.
Age
Name (As of 10/20/97) Position Position Held Since
- --------------- --------------- ------------ -------------------
Dr. John W. Whitney 51 President/Treasurer May 1988
Director
Paul H. Durckel 80 Director September 1995
Richard W. Stumbo, Jr. 64 Vice President, Finance July 1997
Director September 1995
Alan C. Lewin 51 Director September 1997
1) For directors, the term of office is until the next annual meeting of
shareholders.
Narrative Information Concerning the Director Nominees of the Company.
- ----------------------------------------------------------------------
John W. Whitney:
---------------
In addition to being the President and a Director of the Company,
1988 to present, Dr. Whitney is the President and a Director of each of the
operating subsidiaries, Whitney & Whitney, Inc. and Itronics Metallurgical,
Inc. Dr. Whitney also serves as the General Manager of American Hydromet,
a joint venture.
He received his Ph.D. in Mineral Economics from Pennsylvania State
University in 1976, his M.S. in Mineralogy from the University of Nebraska in
1971, and his B.S. in Geology from the University of Nebraska in 1970. Dr.
Whitney has served as President of Whitney & Whitney, Inc. since its
formation in 1977.
Prior to his serving as W&W full-time president, Dr. Whitney worked
as a consultant for the Office of Technology Assessment, U.S. Congress, doing
analysis of various Alaskan mineral issues (1977-1978), a consultant for
various government agencies, including the office of Mineral Policy Analysis
in the U.S. Department of Interior, and the Washington, D.C. office of the
U.S. Bureau of Mines, consulting firms, law firms and mining companies on a
variety of mineral planning issues (1976-1977), as a consultant for BKW
Associates, Inc. evaluating mining investment opportunities in Mexico and
the Philippines (1973-1975), and as a geologist-mineralogist for Humble Oil &
Refining Company and GeoTerrex Ltd. (1971-1972).
Dr. Whitney is an internationally recognized consultant in the field
of Metal and Material Resource Economics. Dr. Whitney has presented seminars
for various clients on Mining Economics, and has taught a three-credit
graduate course on International Metal Economics for the University of
Arizona's College of Mines. Dr. Whitney is an Honorary Faculty Member of the
Academy for Metals and Materials under the seal of the American Society for
Metals. Dr. Whitney has made numerous presentations and written a number of
publications on various technical subjects within his broad area of expertise.
Dr. Whitney is coinventor of the American Hydromet process technology and
holds four patents.
Paul H. Durckel:
---------------
Mr. Durckel has served as a director of the Company since September
1995. He has served various companies involved in fertilizer manufacturing
and sales for approximately 30 years. He is presently an Independent Real
Estate Salesman for Myers Realty, Inc. and has served them in varying
capacities, including Broker-Salesman, Consultant, Manager, Vice President of
Operations, and Director, since 1987. His experience in the fertilizer
industry includes Vice President and General Manager and Vice President-
Operations for American Plant Food Corp., Executive Assistant to the Chairman
for Best Fertilizers Co., Vice President and General Manager for Best
Fertilizer of Texas, and Vice President and General Manager for Farm Services
Co.
Richard W. Stumbo. Jr.:
----------------------
Mr. Stumbo has served as a director of the Company since September
1995. He joined the Company as Vice President, Finance and Chief Financial
Officer in July 1997. He received his Bachelor of Science in Civil
Engineering degree from the University of Wisconsin in 1958, his M.B.A. from
the Wharton Graduate Business School in 1968 and completed the Advanced
Management Program at Harvard Business School in 1983. He has held varying
financial management positions at several large companies, including the
position of Vice President, Finance and Chief Financial Officer for Western
Pacific Railroad from 1974 to 1983, for Homestake Mining Company from 1983
to 1990 and for FirstMiss Gold Inc. from 1990 to 1993. Prior to joining the
Company as CFO, he owned and operated a business services company in Reno,
Nevada.
Alan C. Lewin:
-------------
Mr. Lewin has served as a director since September 1997. He had
previously served as a director from September 1995 through June 1996. He
received his Bachelor of Arts Degree in Psychology from the San Diego State
University in 1967. He has extensive operations management experience,
primarily in the x-ray film processing chemical industry. His positions
include Founder, President and Chief Executive Officer of Guardian X-Ray
Equipment Service, Inc. from 1976 to 1992, General Manager of Douglas Roesch
Communications, Inc. from 1992 to 1994, Technical Sales Representative of
Commerce Chemical Company from 1994 to 1996, and Vice President of Commodity
Resource & Environmental, Inc. from August 1996 to July 1997.
Information Relating to Executive Officers
- ------------------------------------------
The following table sets forth the names of and certain information
concerning the Executive Officers not included above with the Director
nominees:
Age
Name (As of 10/20/97) Position Position Held Since
- ------------------ ---------------- --------------- -------------------
Gregory S. Skinner 43 Secretary December 1990
Duane H. Rasmussen 66 Vice President and May 1994
General Manager-IMI
Robert E. Gordon 65 Vice President and May 1994
General Manager-W&W
5
Narrative Information Concerning the Executive Officers of the Company
- ----------------------------------------------------------------------
Gregory S. Skinner, Esq.:
------------------------
Mr. Skinner has served as secretary and general counsel of the
Company and its subsidiaries since December 1990. He obtained his BA degree
in Economics from the University of California at Berkeley in 1976. He
obtained his JD degree from Hastings College of the Law, University of
California at San Francisco in 1979. He is licensed to practice law in the
states of California and Nevada, He is a shareholder in the Law Offices of
Skinner, Sutton & Watson, a Professional Corporation, which has offices
located in Reno and Incline Village, Nevada. Prior to becoming Secretary of
Itronics Inc., Mr. Skinner has provided legal services and advice to Whitney &
Whitney, Inc. since 1980.
Duane H. Rasmussen:
------------------
Mr. Rasmussen has served as Vice President and General Manager of
IMI since May 1994. He initially joined the Company in 1991 as Assistant
Manager and Business Consultant for W&W. He received his Bachelor of Science
degree in Chemical Engineering from the University of Wisconsin in 1953 and
his MBA in Industrial Management in 1955 from the same University. He served
as President of Screen Printing Systems, Inc. from 1987 to 1990 and from 1995
to the present. Other business experience includes approximately 20 years
with Jacobs Engineering Group, Inc. in varying capacities, including Project
Manager, Regional Sales Manager, Regional Vice President, and Group Vice
President.
Robert E. Gordon:
----------------
Mr. Gordon has served as Vice President and General Manager
of W&W since May 1994. He initially joined the Company in December 1993 as
Assistant Site Manager of the Townsend Mine project. He received his Bachelor
of Science in Geological Engineering from the University of Arizona in 1961.
Prior to joining the Company, he was an independent mining consultant in 1993,
served as Director of Latin American Exploration for Fischer-Watt Gold
Company, Inc. from 1991 to 1993, and served as Vice President, Exploration
for Gexa Gold Corp. from 1989 to 1991.
EXECUTIVE COMPENSATION.
- -----------------------
Summary of Cash and Certain Other Compensation
- ----------------------------------------------
The following table sets forth information as to the compensation of
the Chief Executive Officer and the four most highly compensated officers
whose compensation for the year ended December 31, 1996 exceeded $100,000:
Annual Compensation
Name and -----------------------
Principal Calendar
Position Year Salary Bonus
-------------- -------- ---------- ---------
Dr. John W. Whitney: 1996 $96,547 $-0-
President, Treasurer 1995 $87,927 $-0-
and Director 1994 $65,339 $-0-
1) As of December 31, 1996, Dr. Whitney had accumulated deferred
salary totaling $254,750. Of this amount, $49,750 was accrued in 1996,
$58,333 was accrued in 1995, and $25,167 was accrued in 1994. Dr. Whitney was
granted an option in November 1992 to convert $147,500 of the deferred salary
into the Company's common stock at $.10 per share. In December 1995, Dr.
Whitney was granted an option to convert an additional $102,500 of the
deferred salary into the Company's common stock at $.l0 per share. The
combined total convertible deferred salary was $250,000 at $.10 per share, or
6
2,500,000 shares. The option, originally due to expire on February 5, 1997,
was extended to six months after all debts owed to, or guaranteed by, Dr.
Whitney by Itronics Inc., its subsidiaries and partnerships are paid in full.
In May 1996 Dr. Whitney received a warrant for 100,000 shares. The warrant is
exercisable for five years at $.10 per share and was issued in conjunction
with Dr. Whitney's acquisition of 100,000 shares for cash. On December 31,
1996, Dr. Whitney exercised options on 500,000 shares by converting $50,000
of his deferred salary. In January and June 1997 Dr. Whitney exercised
options on an additional 75,000 and 300,000 shares by cash payment of $7,500
and $30,000, respectively. In September and October 1997 Dr. Whitney exercised
options totaling 1,450,000 shares by converting $145,000 of his deferred
salary. After these option exercises in 1997, the remaining options and
warrants total 1,475,000 shares.
2) The salary amounts listed above include $547, $1,094, and $1,172
for 1996, 1995, and 1994, respectively, that represent compensation paid in
common stock for service as a director of the Company. The compensation plan
for all directors was 2,500 shares per quarter for 1996. The shares are valued
at the closing high bid price as of the last business day of each quarter.
Option Grants in Last Fiscal Year
- ---------------------------------
% of Total
Options Options Granted Exercise Expiration
Name Granted to Employees Price Date
- ------------------- ---------- --------------- -------- ----------
Dr. John W. Whitney 100,000 100% $.10 5/30/01
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option
- --------------------------------------------------------------------------
Values
------
Options Exercised:
Shares Acquired on
Name Exercise (#) Value Realized($)
- ------------------- ------------------ -----------------
Dr. John W. Whitney 500,000 $-0-
Options Unexercised:
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Options at 12/31/96 At 12/31/96
---------------------- --------------------
Name Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
Dr. John W. Whitney 3,300,000 - $ -0- $ -0-
1) Fair market value of the securities underlying the options is based on
the closing high bid price as of the last business day of the fiscal year
($.0625). Value of the unexercised options is the fair market value less the
exercise price ($.10).
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
- -----------------------------------------------
During the Company's two most recent fiscal years, including those of
its subsidiaries and affiliates, the Company engaged in no transactions or
series of transactions with any director, officer, security holder or family
thereof in which the amount involved exceeded $60,000 except as follows:
1. As of December 31, 1996. Dr. Whitney has accumulated deferred
salary totaling $254,750, with $108,083 of that amount accruing during
1996 and 1995.
7
2. In 1993, a note payable to an unrelated party in the amount of
$151,602, including accrued interest, was settled for $92,000. The
settlement was primarily funded by a bank loan in the amount of
$80,000. The makers and guarantors of the bank note are Drs. Whitney
and Cavell. The liability is recorded in the Company's balance sheet
and the Company pays the monthly payment on the note. The balance
due as of December 31, 1996 is $29,002.
3. In 1994, options totaling 2,675,000 shares for Dr. Whitney and
200,000 shares for Dr. Cavell, which were to expire in 1995, were
extended to dates ranging from February 5, 1996 to May 15, 1997. The
option price of $.10 per share remained unchanged. In 1995, an
additional option for 1,025,000 shares was granted to Dr. Whitney
and his existing options were extended to dates ranging from February
5, 1997 to May 15, 1997. In 1996, Dr. Whitney's and Dr. Cavell's
options were extended to six months after all debts of Itronics Inc.
and its subsidiaries and partnerships owed to or guaranteed by Drs.
Whitney and Cavell are paid in full.
4. During 1996, a Nevada mine property, a majority of which is owned
by Drs. Whitney and Cavell, retained the services of W&W to negotiate
a lease for the property and to perform other technical services as
needed. Total 1996 billings on the project, including pass through
expenses of approximately $26,400, amounted to approximately $97,000.
Terms for providing service are similar to that of unrelated clients
and all billings due at December 31, 1996 have subsequently been
received.
PROPOSAL TO AMEND
THE ARTICLES OF INCORPORATION
TO INCREASE THE AUTHORIZED SHARES
PROPOSAL 2
At the Annual Meeting, an amendment to the Company's Articles of
Incorporation will be presented which will increase the number of authorized
common shares from 50,000,000 of $.001 par value to 250,000,000 of $.001
par value. The Board of Directors is proposing this amendment to create
additional flexibility for future financing and acquisitions. At present,
in excess of 40,000,000 shares are of record. In addition, there are presently
in excess of 5,000,000 shares in options and warrants that may be exercised
in the future. Therefore, the Board of Directors believes it is appropriate
to increase the Company's authorized shares.
An increase in the number of authorized shares could lead to issuance
of additional shares, which would dilute a shareholder's existing ownership
interest in the Company. Furthermore, the issuance of any such shares to
persons other than the public would further reduce the amount of control in
the hands of the public.
1996 ANNUAL REPORT
The Company's Form 10-KSB for 1996 as filed with the Securities and
Exchange Commission will serve as the Company's 1996 annual report. The 1996
Form 10-KSB is being mailed to each shareholder along with this proxy
statement. ADDITIONAL COPIES OF THE 1996 FORM 10-KSB MAY BE OBTAINED BY
WRITING TO THE CORPORATION.
1998 ANNUAL MEETING
Proposals of shareholders intended to be presented at the 1998 annual
meeting must be received by the Company for inclusion in Management's Proxy
Statement by March 31, 1998.
8
OTHER BUSINESS TO BE TRANSACTED
As of the date of this Proxy Statement, the Board of Directors knows
of no other business to be presented for action at the Annual Meeting. If any
other business is properly brought before the Annual Meeting, the proxies
returned by the Company's shareholders confer discretionary authority on the
persons named therein. Those persons will vote or act in accordance with
their best judgement with respect to those matters.
You are urged to vote, sign, date and return the accompanying proxy
prior to the Annual Meeting, whether or not you currently plan to attend the
Annual Meeting in person, to the following address:
Itronics Inc.
P.O. Box 10725
Reno, Nevada 89510
By Order of the Board of Directors
JOHN W. WHITNEY
___________________________________
October 27, 1997 John W. Whitney, President and
Treasurer
9
ITRONICS INC.
PROXY
ANNUAL MEETING OF SHAREHOLDERS
NOVEMBER 19, 1997
The undersigned hereby constitutes and appoints John W. Whitney, with
power of substitution, to represent and vote on behalf of the undersigned all
of the shares of Itronics Inc. which the undersigned is entitled to vote at
the Annual Meeting of Stockholders to be held at the Airport Plaza Hotel,
Reno, Nevada, on November 19, 1997 at 10:00 A.M. Pacific time, including any
adjournment or adjournments thereof.
Total votes available to cast for the two proposals is:
Number of Shares ________________________
PLEASE MARK THE FOLLOWING WITH AN "X"
Proposal 1: Election of Directors
Names of Nominees:
John W. Whitney
Paul H. Durckel
Richard W. Stumbo, Jr.
Alan C. Lewin
Vote for the election of the above directors as a group:
( ) FOR ( ) AGAINST ( ) ABSTAIN
Proposal 2: Increase in authorized shares from 50,000,000 to 250,000,000.
( ) FOR ( ) AGAINST ( ) ABSTAIN
PLEASE VOTE, DATE AND SIGN YOUR NAME(S) EXACTLY AS PRINTED ON THIS
PROXY, indicating where applicable, official position or
representative capacity.
_______________________________________
Signature
___________________
Date