LEADVILLE MINING & MILLING CORPORATION
700 CARR STREET
LAKEWOOD, COLORADO 80215
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
FEBRUARY 25, 1998
The following instructions concerning the enclosed Proxy and the matters to be
acted upon at the Annual Meeting of Shareholders of record as of January 2, 1998
to be held at the Golden Burro Cafe & Lounge, 710 Harrison Avenue, Leadville,
Colorado 80461 at 11 a.m. in the morning (Mountain Time) on Wednesday, February
25, 1998 is submitted to the Shareholders for their information.
The approximate date of mailing of this solicitation is January 12, 1998.
SOLICITATION OF AND POWER TO REVOKE PROXY
Solicitation of the enclosed Proxy is being made on behalf of the Corporation's
Board of Directors which has designated the nominees for Directors listed below.
Supplementary solicitation may be made by mail, telegraph, telephone or
interview by officers and employees of the Corporation, the cost of which will
be nominal. The Corporation will bear the entire cost of the solicitation of
Proxies, including the charges and expenses of brokerage firms and others for
forwarding solicitation material to beneficial owners of stock. Legal and
accounting fees in connection with the preparation of this proxy are normally
covered by the Company's arrangements with legal counsel and the auditors for
preparation of annual reports and proxies for election of directors and
selection of auditors. A Shareholder executing and delivering a Proxy has power
to revoke the same and the authority given thereby at any time prior to the
exercise of such authority, if he so elects, by notification to the Secretary of
the Corporation prior to the Annual Meeting or by Notice to the Inspectors of
Election at the Annual Meeting.
PROPOSAL OF SECURITY HOLDERS
A Shareholder of record may present a proposal for action at the next Annual
Meeting of Shareholders provided that such proposal is received by the
Corporation at its executive office no later than September 16, 1998. Upon
receipt of such proposal, the Corporation shall set forth the proposal in its
Proxy Statement for that meeting. The proponent may submit a maximum of two (2)
proposals of not more than three hundred (300) words each for inclusion in the
Corporation's proxy materials for a meeting of security holders.
INFORMATION CONCERNING NOMINEES FOR DIRECTORS
It is proposed at the Meeting to elect five (5) Directors to constitute the
Board of Directors, who are to serve until the next Annual Meeting of
Shareholders, or until a successor shall be elected.
The information set forth below is submitted with respect to the nominees for
the Board of Directors for whom it is intended that the Proxies will be voted.
Served as a
Nominee Director Since
- --------------------------------------------------------------------------------
Donald Wilson President, Director 1983
Mining Consultant
Contractor
Gifford A. Dieterle Treasurer, Secretary 1983
& Chairman of Board
of Directors
Geological Consultant
Horst Scherp Geologist, Professor 1995
Director
Robert N. Roningen Officer & Director 1992
Attorney at Law
Geologist
Jack Everett Director 1995
Consulting Geologist
All of the above nominees currently are members of the Board of Directors. The
Corporation has no reason to believe that any of the nominees will be unable to
serve. If any such nominees are unable to serve, it is the intention of the
persons named in the enclosed Proxy to vote shares represented by Proxies
received by them in favor of such other person as the Board of Directors of the
Corporation may, at any time, recommend. The Corporation does not have any
standing nominating or compensation committees of the Board of Directors or any
committees performing similar function. The Board of Directors held 15 regular
and special meetings during the past fiscal year. All of the incumbent Directors
voted at each of the meetings of the Board of Directors which were held during
the past fiscal year.
Set forth below is a description of the backgrounds of each of the Directors of
the Company.
DONALD W. WILSON, President and Director. His highest educational degree is a
High School diploma obtained from Leadville High School in Leadville, Colorado
in 1949. He additionally attended the Colorado School of Mines in 1969 on a
non-matriculating basis, where he took courses in geology, surveying, mapping
and mathematics. He did not graduate and therefore did not obtain a degree. His
employment history since 1977 consists of the following: From May 1983 until the
present, he has been President of the Company. From January 1981 to May 1983, he
was mine and mill manager of the Franklin Mine, a gold mine in Colorado which is
owned by Franklin Consolidated Mining Company. From 1979 to 1980, he was
employed by M.S.T. Company - Rio Blanco Oil Shale Corporation as a project
engineer. From 1977 to 1979, he was employed by United Nuclear-Homestake
Partnership, Inc., Grants, New Mexico as a superintendent of shaft sinking
operation.
2
GIFFORD A. DIETERLE, Executive Vice-President, Treasurer and Chairman of the
Board of Directors of the Company. His highest educational degree is a M.S. in
Geology obtained from New York University. From 1977 until July 1993, he was
Chairman, Treasurer and Executive Vice-President of Franklin Consolidated Mining
Company. From 1965 to 1987, he was lecturer in geology at the City University of
N.Y. (Hunter Division). Since 1962, he has been a consulting geologist engaged
in the geological evaluation of oil and mineral properties. From 1978 until the
present, he has been a registered representative with Datek Securities.
ROBERT RONINGEN, Vice President-Operations and a director, has, for more than
the past five years, been engaged in the practice of law as a sole practitioner
and is a self-employed consultant geophysicist in Duluth, Minnesota. From 1988
to August 1993, he was an officer and director of Franklin Consolidated Mining
Company, Inc. He graduated from the University of Minnesota in 1957 with a B.A.
in geology and in 1962 with a degree in Law.
HORST SCHERP, a director, has been an Associate Professor of Geology at Hunter
College of the City of New York since 1963. From 1980 to 1987, he was a Director
and geologist for Jeger Oil Corporation Mr. Scherp received a Ph.D in geology
from the University of Gottingen, Germany, in 1959.
JACK V. EVERETT, a director, has been a consulting mining geologist for 25
years, with expertise in all phases of exploration for base and precious metals.
Following his 1947 graduation from Michigan State University, he was District
Geologist for Pickands Mather & Company on the Cuyuna Iron Range, Minnesota.
From 1951 to 1970, he was Chief Geologist and Exploration Manager for W.S. Moore
Company, Duluth, Minnesota, an iron mining company with gold and base metal
sulfide holdings in the U.S. and Canada.
The Board of Directors recommends that you vote FOR all nominees for the Board
of Directors.
QUORUM AND VOTE REQUIRED
The presence, in person or by proxy of the holders of at least a majority of the
outstanding shares of Common Stock is necessary to constitute a quorum at the
Annual Meeting. Approval of each Proposal will require the affirmative vote of
the holders of at least a majority of the shares of Common Stock of the Company
present in person or by proxy, except for the election of directors, which is
decided by a plurality of the votes present in person or by proxy. Management of
the Company recommends that you vote your shares in favor of all proposals.
CAPITAL STOCK
The outstanding Capital Stock on January 2, 1998, the record date, was
14,380,900 shares of Common Stock owned by Stockholders. Stockholders of record
as of January 2, 1998 will be entitled to one (1) vote for each share of such
stock registered in their respective names at the close of business on the
aforesaid record date. Cumulative voting in the election as Directors is not
permitted. The present officers who hold more than ten (10) percent of the
outstanding stock, intend to vote for the slate of Directors and the selection
of the independent auditors. Their votes may be decisive on these issues.
3
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information with respect to the number of
shares of Common Stock beneficially owned as of January 2, 1998, by (1) all
holders of shares of Common Stock known by the Company to own beneficially more
than 5% of the outstanding shares of any class of the Voting Stock, (2) the
Executive Officers and Directors of the Company and (3) all Directors and
Officers of the Company as a group.
Name of Amount & Nature
Beneficial of Beneficial Approximate
Title of Class Owner Ownership 1/2/98(1) Percentage(2)(3)
- -------------- ----- ------------------- ----------------
Common Stock Donald W. Wilson 1,335,100(3) 8.9%
Common Stock Gifford A. Dieterle 1,421,105(3)(4) 9.6%
Common Stock Jack Everett 325,000(3) 2.2%
Common Stock Robert Roningen 666,688(3)(5) 4.5%
Common Stock Horst Scherp 15,000(3) *
All Officers and
Directors as a
Group (5) 3,762,893(3)(4)(5) 23.9%
- ----------
* Less than one percent.
(1) Supplied by the persons set forth above.
(2) Based upon 14,380,900 shares issued and outstanding as of January 2,
1998.
(3) For Messrs. Wilson, Dieterle, Everett, Roningen and Scherp includes,
respectively, 550,000 shares, 403,270 shares, 75,000 shares, 350,000
shares and 10,000 shares issuable upon exercise of options and/or
warrants.
(4) Includes shares owned by Mr. Dieterle's wife.
(5) Includes shares owned by Mr. Roningen's wife and children.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Effective April 11, 1997, the Company reverse split its outstanding shares of
Common Stock on a one-for-ten basis and adjusted the terms of all outstanding
options and warrants accordingly. Unless the context specifically indicates
otherwise, all references herein to Shares, options and warrants have been
adjusted to take into account the reverse split.
Between September 1, 1991 and July 31, 1995, the Company and Franklin
Consolidated Mining & Milling Company lent to one another on short term basis,
small amounts of money for current operations. The Company currently is a
creditor of Franklin Consolidated Mining Company in the amount of approximately
$5,826.
On April 2, 1997, the Company issued the following options to certain officers
and directors. Donald Wilson - option to purchase 350,000 shares; Gifford
Dieterle - option to purchase 350,000 shares; Robert Roningen option to purchase
4
350,000 shares; Jack Everett - option to purchase 50,000 shares; Horst Scherp -
option to purchase 10,000 shares. All options granted on that date expire on
April 2, 2002 and are exercisable at $.35 per share.
On January 5, 1996, the Company issued the following options to certain officers
and directors. Donald Wilson - option to purchase 200,000 shares; Gifford
Dieterle - option to purchase 220,000 shares; Robert Roningen - option to
purchase 150,000 shares; Jack Everett - option to purchase 25,000 shares; Horst
Scherp - option to purchase 5,000 shares. All options granted on that date
expire on January 5, 1998 and are exercisable at $.35 per share.
During fiscal 1993 and 1994, Gifford A. Dieterle an officer and director of the
Company, loaned the Company $18,873, which funds were used for operating
expenses. There were no specific repayment terms and the loans were interest
free. As of July 31, 1997, these loans had been paid in full.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
To the Company's knowledge, based solely on a review of such materials as are
required by the Securities and Exchange Commission, no officer, director or
beneficial holder of more than ten percent of the Company's issued and
outstanding shares of Common Stock failed to timely file with the Securities and
Exchange Commission any form or report required to be so filed pursuant to
Section 16(a) of the Securities Exchange Act of 1934 during the fiscal year
ended September 30, 1996, except that Gifford A. Dieterle failed to file two
reports concerning two transactions; and Donald W. Wilson, Robert Roningen,
Horst Scherp and Jack V. Everett each failed to file one report concerning one
transaction.
REMUNERATION OF DIRECTORS AND OFFICERS
The following table shows all the cash compensation paid or to be paid by the
Company or any of its subsidiaries, as well as certain other compensation paid
or accrued, during the fiscal years indicated, to the Chief Executive Officer
for such period in all capacities in which he served. No Executive Officer
received total annual salary and bonus in excess of $100,000.
SUMMARY COMPENSATION TABLE
Long-Term Compensation
-------------------------------
Annual Compensation Awards Payouts
------------------------------- ------------------- -----------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
- ------------------ ---- ------ --- --------- --------- ------- --------- --------
Other Restrict- All Other
Annual ed Stock LTIP Compensa
Name and Principal Compen- Award Options Payouts -tion
Position Year Salary ($) sation($) ($) SARs ($) (i)
- ------------------ ---- ------ --- --------- --------- ------- --------- --------
Donald W. Wilson 1997 54,586 -0- -0- -0- 200,000 -0- -0-
Chief Executive 1996 54,023 -0- -0- -0- 200,000 -0- -0-
Officer 1995 53,472 -0- -0- -0- -0- -0- -0-
5
The following table sets forth information with respect to the Company's
Executive Officers concerning the grants of options and Stock Appreciation
Rights ("SAR") during the past fiscal year:
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Individual Grants
(a) (b) (c) (d) (e)
- ---------------------------------------------------------------------------------------------------
Percent of Total
Options/SARs
Options/ Granted to
SARs Employed in Exercise or Base Expiration
Name Granted Fiscal Year Price ($/SH) Date
- ---------------------------------------------------------------------------------------------------
Donald W. Wilson 350,000 31.5% $.35 April 2, 1998
Gifford Dieterle 350,000 31.5% $.35 April 2, 1998
Robert Roningen 350,000 31.5% $.35 April 2, 1998
Jack Everett 50,000 4.5% $.35 April 2, 1998
Horst Scherp 10,000 1.0% $.35 April 2, 1998
The following table sets forth information with respect to the Company's
Executive Officers concerning exercise of options during the last fiscal year
and unexercised options and SARs held as of the end of the fiscal year:
Aggregated Option/SAR Exercises and Fiscal Year-End Option/SAR
(a) (b) (c) (d) (e)
- ---------------------------------------------------------------------------------------------------
Value of
Number of Unexercised
Unexercised In-the-Money
Options/SARs Option/SARs
Shares at FY-End(#) at FY-End(#)
Acquired on Value Exercisable/ Exercisable/
Name Exercise(#) Realized Unexercisable Unexercisable
- ---------------------------------------------------------------------------------------------------
Donald W. Wilson -0- -0- 550,000 --
Gifford Dieterle 96,730 $ 9,673 403,270 --
Robert Roningen -0- -0- 350,000 --
Jack Everett -0- -0- 50,000 --
Horst Scherp 50,000 17,500 10,000 --
DEFERRED COMPENSATION PLAN
During the past five (5) years the Corporation has not adopted any deferred
compensation, pension bonus or profit sharing plans or other incentive plans for
the benefit of any Officer or Director.
PENSION PLAN
The Corporation has no Pension Plan for its managerial and clerical non-union
employees.
COMPANY'S STOCK OPTION PLAN
The Company has no Qualified Stock Option Plans.
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SELECTION OF AUDITORS
The Board of Directors has appointed Wolinetz, Gottlieb & Lafazan, P.C.,
Rockville Centre, New York, to serve as the Company's independent public
accountants for the fiscal year ending July 31, 1998, subject to approval of the
stockholders. Wolinetz, Gottlieb & Lafazan, P.C. examined the Company's
consolidated financial statements for the fiscal year ended July 31, 1997 and is
considered well qualified.
A representative from Wolinetz, Gottlieb & Lafazan, P.C. will not be present at
the Stockholders' Annual Meeting.
The Board of Directors recommends that you vote FOR the approval of Wolinetz,
Gottlieb & Lafazan, P.C. as the Company's independent public accountants.
GENERAL
As of the date of the Proxy Statement, there is no matter, so far as in now
known to the management of the Corporation, to be acted on at the Meeting other
than as expressly set forth in the Notice of Meeting. It is intended, however,
if other matters come up for action at said meeting or an adjournment thereof
that the persons named in the enclosed form of Proxy, shall, in accordance with
the terms of the proxy, have authority in their discretion to vote shares
represented by Proxies received by them, in regard to such other matters, as
seems to said persons in the best interest of the Corporation and its
Shareholders.
All shares represented by Proxies in the form enclosed herewith will be voted at
said meeting and adjournments thereof in accordance with the terms of such
proxies and their pertinent statements included in this Proxy Statement relative
to the exercise of the powers granted by said Proxies, provided such Proxies
appear to be valid and to have been executed by Stockholders of record entitled
to vote thereof and have not been previously revoked.
Dated: BY ORDER OF THE BOARD OF DIRECTORS,
January 12, 1998
Gifford A. Dieterle
Chairman of the Board,
Secretary and Treasurer
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO THE STOCKHOLDERS OF LEADVILLE MINING & MILLING CORP.
NOTICE IS HEREBY GIVEN that the annual meeting of Stockholders of Leadville
Mining & Milling Corporation will be held at the Golden Burro Cafe & Lounge, 710
Harrison Avenue, Leadville, Colorado 80461 on Wednesday, the 25th of February,
1998 at 11 a.m. for the following purposes:
1. To elect 5 directors - Donald Wilson, Gifford A. Dieterle, Jack
Everett, Horst Scherp, Robert Roningen.
2. Re-appointment of Wolinetz, Gottlieb & Lafazan, P.C. as Independent
Auditors for the coming year.
3. Any other business which may come before the Board.
The close of business on January 2, 1998 has been fixed as the date of record
for determining stockholders entitled to receive notice of and to vote at the
Annual Meeting of Stockholders or any adjournment thereof.
All Stockholders are respectfully urged to attend this meeting.
If you do not expect to attend the meeting in person, please sign and date the
Proxy, detach and mail promptly to the Company's office.
Dated: January 12, 1998 By Order of the Board of Directors
Secretary
- --------------------------------------------------------------------------------
Tear along dotted line
LEADVILLE MINING & MILLING CORPORATION
PROXY
Annual Meeting of Stockholders
The undersigned hereby appoints Robert Roningen the true and lawful attorney of
the undersigned, with power of substitution to vote as proxies for the
undersigned at the Annual Meeting of Stockholders of Leadville Mining & Milling
Corporation, to be held on Wednesday, February 25th, 1998 at 11 a.m. at the
Golden Burro Cafe & Lounge, 710 Harrison Avenue, Leadville, Colorado 80461 and
at any and all adjournments thereof, according to the number of shares which the
undersigned would be entitled to vote if then personally presented for the
following purposes:
1. Election of (5) members to serve on the Board of Directors:
FOR AGAINST OBSTAIN
Donald Wilson |_| |_| |_|
Gifford A. Dieterle |_| |_| |_|
Horst Scherp |_| |_| |_|
Jack Everett |_| |_| |_|
Robert Roningen |_| |_| |_|
2. Appointment of Wolinetz, Gottlieb
& Lafazan P.C., C.P.A. as
independent auditors for the
coming year. |_| |_| |_|
This proxy is solicited on behalf of management and if received prior to the
meeting, properly executed, it will be voted. If not otherwise specified, this
proxy will be voted "For" 1 and 2.
Receipt is acknowledged of the accompanying Notice of Annual Meeting and Proxy
Statement (mail Proxy Statement).
Please advise if you are attending Yes ____ No ____ No. of Shares ____
Return to:
LEADVILLE MINING & MILLING CORPORATION
76 Beaver Street - Suite 500
New York City, New York 10005
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Please Print Your Name Date
---------------------------------------------
Please sign exactly as your name appears
hereon including representative capacity
joint owners should both sign.