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
/ / CONFIDENTIAL FOR USE OF COMMISSION ONLY
/X/ DEFINITIVE PROXY STATEMENT
/ / DEFINITIVE ADDITIONAL MATERIALS
/ / SOLICITING MATERIALS PURSUANT TO SS.240.14A-11(C) OR SS.240.14A-12
WASTE TECHNOLOGY CORP.
- --------------------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
- --------------------------------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT IF OTHER THAN REGISTRANT)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX)
/X/ NO FEE REQUIRED
/ / $125 PER EXCHANGE ACT RULES-O-11(C)(1)(II), 14A-6(I)(1), 14A-6(I)(2) OR ITEM
22(A)(2) OF SCHEDULE 14A.
/ / FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES14A-6(I)(4) AND O-11.
1) TITLE OF EACH CLASS OF SECURITIES TO WHICH EACH 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 O-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 BY WRITTEN PRELIMINARY MATERIALS.
/ / CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY EXHANGE ACT RULE
O-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: _________________________________________________________________
WASTE TECHNOLOGY CORP.
5400 RIO GRANDE AVENUE
JACKSONVILLE, FLORIDA 32254
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
APRIL 21, 2008
TO THE STOCKHOLDERS:
Notice is hereby given that the annual meeting of stockholders (the "Annual
Meeting") of Waste Technology Corp. (the "Company") has been called for and will
be held at 10:00 A.M., local time, on Monday, April 21, 2008, at the offices of
the Company, 5400 Rio Grande Avenue, Jacksonville, Florida 32254 for the
following purposes:
1. To elect two (2) Class I Directors, Leland E. Boren and Mathew M. Price
to the Board of Directors;
2. To ratify the appointment by the Board of Directors of KPMG LLP, to
serve as the independent certified public accountants for the current fiscal
year; and
3. To consider and transact such other business as may properly come before
the Annual Meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on March 5, 2008 as
the record date for the determination of the stockholders entitled to notice of,
and to vote at, the Annual Meeting or any adjournments thereof. The list of
stockholders entitled to vote at the Annual Meeting will be available for
examination by any stockholder at the Company's offices at 5400 Rio Grande
Avenue, Jacksonville, Florida 32254, for ten (10) days prior to April 21, 2008.
By Order of the Board of Directors
Ronald L. McDaniel
Chairman
Dated: March 19, 2008
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE FILL IN, SIGN, AND
DATE THE PROXY SUBMITTED HEREWITH AND RETURN IT IN THE ENCLOSED STAMPED
ENVELOPE. THE GRANTING OF SUCH PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE SUCH
PROXY IN PERSON SHOULD YOU LATER DECIDE TO ATTEND THE MEETING. THE ENCLOSED
PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS.
WASTE TECHNOLOGY CORP.
PROXY STATEMENT
GENERAL
This proxy statement is furnished by the Board of Directors of Waste
Technology Corp., a Delaware corporation (sometimes the "Company" or "Waste
Tech"), with offices located at 5400 Rio Grande Avenue, Jacksonville, Florida
32254, in connection with the solicitation of proxies to be used at the annual
meeting of stockholders of the Company to be held on April 21, 2008 and at any
adjournments thereof (the "Annual Meeting"). This proxy statement will be mailed
to stockholders beginning approximately March 19, 2008. If a proxy in the
accompanying form is properly executed and returned, the shares represented
thereby will be voted as instructed on the proxy. Any proxy may be revoked by a
stockholder prior to its exercise upon written notice to the President of the
Company, or by a stockholder voting in person at the Annual Meeting.
All properly executed proxies received prior to the Annual Meeting will be
voted at the Annual Meeting in accordance with the instructions marked thereon
or otherwise as provided therein. Unless instructions to the contrary are
indicated, proxies will be voted FOR the election of the Directors named therein
and FOR the ratification of the selection by the Board of Directors of KPMG LLP,
as the independent certified public accountants of the Company.
A copy of the annual report on Form 10-KSB of the Company for the fiscal
year ended October 31, 2007 ("Fiscal 2007"), which contains financial statements
audited by the Company's independent certified public accountants, accompanies
this proxy statement.
The cost of preparing, assembling and mailing this notice of meeting, proxy
statement, the enclosed annual report and proxy will be borne by the Company. In
addition to solicitation of the proxies by use of the mails, some of the
officers and regular employees of the Company, without extra remuneration, may
solicit proxies personally or by telephone, telegraph, or cable. The Company may
also request brokerage houses, nominees, custodians and fiduciaries to forward
soliciting material to the beneficial owners of the Common Stock. The Company
will reimburse such persons for their expenses in forwarding soliciting
material.
2
VOTING SECURITIES AND
PRINCIPAL HOLDERS THEREOF
The Board of Directors has fixed the close of business on March 5, 2008 as
the record date (the "Record Date") for the determination of stockholders
entitled to notice of, and to vote at the Annual Meeting. Only stockholders on
the Record Date will be able to vote at the Annual Meeting.
As of the Record Date, 4,933,895 shares of the Company's common stock, $.01
par value per share ("Common Stock") are outstanding, and each share will be
entitled to one (1) vote, with no shares having cumulative voting rights.
Holders of shares of Common Stock are entitled to vote on all matters. Unless
otherwise indicated herein, a majority of the votes represented by shares
present or represented at the Annual Meeting is required for approval of each
matter which will be submitted to stockholders. The Company also has 10,000,000
shares of Preferred Stock, $.0001 par value per share authorized, none of which
are outstanding.
As set forth in the table below, LaRita R. Boren and her husband, Leland E
Boren, together beneficially own more than 50% of the Company's outstanding and
issued shares of common stock. Mr. and Mrs. Boren have a verbal agreement or
understanding to vote their shares in a like manner. As a result, the Company is
considered a "controlled company" under the applicable rules of The Nasdaq Stock
Market. Members of our management have been informed that our controlling
shareholders intend to vote in favor of all of the nominees for directors and
for the ratification of KPMG LLP to serve as the Company's independent certified
public accountants. Therefore, the proposals specified in Items 1and 2 of the
Notice of Annual Meeting are likely to be passed.
Management knows of no business other than that specified in Items 1 and 2
of the Notice of Annual Meeting which will be presented for consideration at the
Annual Meeting. If any other matter is properly presented, it is the intention
of the persons named in the enclosed proxy to vote in accordance with their best
judgment.
The following table sets forth the share holdings of those persons who own
more than 5% of the Company's common stock as of the record date, March 5, 2008,
with these computations being based upon 4,933,895 shares of the Company's
common stock being outstanding as of that date and as any shareholder, as it may
pertain, assumes the exercise of options held by such shareholder as of March 5,
2008.
3
FIVE PERCENT STOCKHOLDERS
AMOUNT OF
NAME AND ADDRESS OF BENEFICIAL APPROXIMATE
BENEFICIAL OWNER OWNERSHIP(1) PERCENT OF CLASS
- ---------------- ------------ ----------------
LaRita R. Boren 2,644,621(2) 53.6%
9315 South 950 East
Upland, IN 46989
Alexander C. Toppan 434,450(3) 8.8%
40 Spectacle Road
South Kent, CT 06785
- ------------
(1) Unless otherwise stated, all shares of Common Stock are directly held with
sole voting and dispositive power.
(2) Consists of 2,423,853 shares held directly and 220,768 shares held directly
by her husband, Leland E. Boren. Both Mr. and Mrs. Boren are Directors of
the Company and have a verbal agreement to vote their shares in a like
manner.
(3) Shares held in joint tenancy with his wife, Mary T. Toppan.
4
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
GENERAL
- -------
Article III, Section 1 of the Company's By-Laws provides that the Company's
Board of Directors shall consist of a minimum of five (5) and a maximum of nine
(9) directors divided into three (3) classes of directors ("Class I", "Class
II", and "Class III"), with each class having as nearly the same number of
directors as practicable. Stockholders elect such class of directors, Class I,
Class II, or Class III, as the case may be, to succeed such class directors
whose terms are expiring, for a three (3) year term, and such class of directors
shall serve until the successors are elected and qualify. Under this
configuration, it is intended that one class of directors' terms will expire
each year resulting in staggered elections of the Company's directors. At last
year's annual meeting the term of the Company's Class III Directors expired. As
a result, at last year's annual meeting LaRita R. Boren and William E. Nielsen
were elected as a Class III Directors. During Fiscal 2007, Mathew M. Price was
named to the Board of Directors of the Company.
The following is the apportionment of the existing directors into classes:
NO. OF CLASS TERM EXPIRES MEMBERS/NOMINEES
- ------------ ------------ ----------------
Class I 2008 Annual Leland E. Boren
Stockholder's Meeting Mathew M. Price
Class II 2009 Annual David B. Wilhelmy
Stockholder's Meeting Ronald L. McDaniel
Class III 2010 Annual William E. Nielsen
Stockholder's Meeting LaRita R. Boren
Unless authority is withheld, the proxies in the accompanying form will be
voted in favor of the election of Leland E. Boren and Mathew M. Price as a Class
I Directors. If Mr. Boren or Mr. Price should subsequently become unavailable
for election prior to the Annual Meeting, the persons voting the accompanying
proxy may in their discretion vote for a substitute.
5
BOARD OF DIRECTORS
------------------
The Board of Directors has the responsibility for establishing broad
corporate policies and for the overall performance of the Company. Although only
two (2) members of the Board are involved in day-to-day operating details, the
other members of the Board are kept informed of the Company's business by
various reports and documents sent to them as well as by operating and financial
reports made at Board meetings. The Board of Directors held three (3) meetings
in Fiscal 2007. All directors attended all of the meetings of the Board of
Directors during Fiscal 2007. Although it has no formal policy requiring
attendance, the Company encourages all directors to attend the annual meeting of
stockholders. All of the Company's directors attended last year's annual meeting
of stockholders and it is anticipated that all of its directors will attend this
year's Annual Meeting.
INDEPENDENCE OF DIRECTORS
Rule 4350 (c) (1) of The Nasdaq Stock Market rules requires that a majority
of the members of the Company's Board of Directors be independent in that they
are not officers or employees of the Company and are free of any relationship
that would interfere with the exercise of their independent judgment.
The Board of Directors has determined that only two of the Company's
Directors, Ronald L. McDaniel and Matthew M. Price are independent as defined by
the listing standards of the Nasdaq Stock Market Rules, Section 10A(m)(3) of the
Securities Exchange Act of 1934 and the rules and regulations of the Securities
and Exchange Commission.
However, Rule 4350(c)(5) provides an exemption from the requirement that a
majority of the Company's Directors be independent if the Company is considered
a "controlled company. A controlled company is defined as a company of which
more than 50% of the voting power is held by an individual, a group or another
company. LaRita Boren and Leland E. Boren, who are husband and wife and members
of the Company's Board of Directors, have a verbal agreement or understanding to
vote their shares in a like manner. As Mr. and Mrs. Boren together beneficially
own more than 50% of the outstanding shares of the Company's' common stock, the
Company is considered a "controlled company" under the applicable rules of The
Nasdaq Stock Market and as such is exempt from certain of the corporate
governance rules of The Nasdaq Stock Market, such as the requirement that the
board of directors consist of a majority of independent directors.
COMMITTEES
----------
NOMINATING COMMITTEE
In view of the agreement and understanding of LaRita Boren and Leland Boren
who beneficially own more than 50% of the outstanding shares of the Company's
common stock to vote their shares in a like manner, the Company is a "controlled
company" under the applicable rules of The Nasdaq Stock Market, and as such is
exempt from the nominating committee requirements. Therefore, the Company does
not have a standing nominating committee or a nominating committee charter.
However, the full Board of Directors does perform the functions of a nominating
committee. The Board identifies the candidates for Board membership. In
identifying Board candidates, the Board will seek recommendations from existing
Board members, executive officers of the Company and all persons who own more
than five percent (5%) of the Company's outstanding stock. The Board has no
stated specific minimum qualifications that must be met by a candidate for a
position on the Board of Directors. The Board will consider a variety of factors
in evaluating the qualifications of a candidate including the candidate's
professional experience, educational background, knowledge of the Company's
business and personal qualities. The Board may, when appropriate, retain an
executive search firm and other advisors to assist it in identifying candidates
for the Board. In addition, the Board will consider any candidates that may have
been recommended by any of the Company's stockholders who have made those
recommendations in accordance with the procedures described below under the
heading "Stockholders' Proposals." In addition, such stockholder recommendations
must be accompanied by
6
(1) such information about each prospective director nominee as would have been
required to be included in a proxy statement filed pursuant to the rules of the
Securities and Exchange Commission had the prospective director nominee been
nominated by the Board of Directors and (2) that the prospective director
nominee has consented to be named, if nominated, as a nominee and, if elected,
to serve as a director. To date, the Company has not received any
recommendations from shareholders requesting a candidate for inclusion among the
slate of nominees in the Company's proxy statement. The directors of the Company
who participated in the consideration of director-nominees included in this
proxy statement were William E. Nielsen, Ronald L. McDaniel, Leland E. Boren and
LaRita R. Boren.
AUDIT COMMITTEE
The Audit Committee primarily assists our Board in fulfilling its oversight
responsibilities by reviewing our financial reporting and audit processes and
our systems of internal control over financial reporting and disclosure
controls. Ronald McDaniel, Mathew Price and LaRita Boren are members of Board's
Audit Committee. Only Messrs. McDaniel and Price meet the independence
requirements of NASDAQ, the applicable Securities Laws, and the regulations and
rules promulgated by the SEC. The Company has sought and continues to seek
appropriate individuals to serve on the Board of Directors who meet the
requirements necessary to qualify as independent directors to serve on the
Company's Board of Directors. The Company has been unable to find such
independent directors because it has not purchased directors and officers
insurance or compensate such independent directors for their services. Mr.
McDaniel serves as the audit committee's "financial expert" as that term is
defined by applicable SEC regulations. The Company recently adopted an Audit
Committee Charter, a copy of which is appended to this Proxy Statement and is
also available on the Company's website at www. Intl-baler.com. (see appendix A)
The Audit Committee will review and reassess the Audit Committee Charter
annually.
The Audit Committee's functions are:
I. To review with management and the Company's independent auditors the
scope of the annual audit and quarterly statements, significant
financial reporting issues and judgments made in connection with the
preparation of the Company's financial statements;
II. To review major changes to the Company's auditing and accounting
principles and practices suggested by the independent auditors;
III. To monitor the independent auditor's relationship with the Company;
IV. To advise and assist the Board of Directors in evaluating the
independent auditor's examination;
V. To supervise the Company's financial and accounting organization and
financial reporting;
VI. To nominate, for approval of the Board of Directors, a firm of
certified public accountants whose duty it is to audit the financial
records of the Company for the fiscal year for which it is appointed;
and
VII. To review and consider fee arrangements with, and fees charged by, the
Company's independent auditors.
The Audit Committee met with the Company's auditors in fiscal 2007 to
discuss the audit of the Company's year end financial statements. It is intended
that Mr. McDaniel and will continue to be designated the Committee's financial
expert.
7
AUDIT COMMITTEE REPORT
The Audit Committee has:
1. Reviewed and discussed the Company's unaudited financial statements
for the first three quarters of Fiscal 2007 and the Company's audited
financial statements for the year ended October 31, 2007 with the
management of the Company and the Company's independent auditors;
2. Discussed with the Company's independent auditors the matters required
to be discussed by Statement of Auditing Standards No. 61, as the same
was in effect on the date of the Company's financial statements; and
3. Received the written disclosures and the letter from the Company's
independent auditors required by Independence Standards Board Standard
No. 1 (Independence Discussions with Audit Committees), as the same
was in effect on the date of the Company's financial statements, has
discussed with representatives of the Company's independent auditors
the auditors independence from management and the Company and
satisfied itself as to the Company's auditors independence.
Based on the foregoing materials and discussions, the Audit Committee
recommended to the Board of Directors that the unaudited financial statements
for each of the first three quarters of Fiscal 2007 be included in the Quarterly
Reports on Form 10-Q for those quarters and that the audited financial
statements for the year ended October 31, 2007 be included in the Company's
Annual Report on Form 10-K for the year ended October 31, 2007.
Members of the Audit Committee
Ronald L. McDaniel
Matthew M. Price
LaRita R. Boren
8
COMPENSATION COMMITTEE
During fiscal 2007, Leland Boren and Ronald McDaniel were members of the
Company's compensation committee. The Compensation Committee's functions, in
conjunction with the Board of Directors, are to provide recommendations with
respect to, general and specific compensation policies and practices of the
Company for directors, officers and other employees of the Company. The
Compensation Committee expects to periodically review the approach to executive
compensation and to make changes as competitive conditions and other
circumstances warrant and will seek to ensure the Company's compensation
philosophy is consistent with the Company's best interests and is properly
implemented. The Committee determines or recommends to the Board of Directors
for determination the specific compensation of the Company's Chief Executive
Officer and all of the Company's other officers. Although the Committee may seek
the input of the Company's Chief Executive Officer in determining the
compensation of the Company's other executive officers, the Chief Executive
Officer may not be present during the voting or deliberations with respect to
his compensation. The Committee may not delegate any of its responsibilities
unless it is to a subcommittee formed by the Committee. The Compensation
Committee met one time in Fiscal 2007. The Committee has the authority to retain
a compensation consultant or other advisors to assist it in the evaluation of
compensation and has the sole authority to approve the fees and other terms of
retention of such consultants and advisors and to terminate their services. To
date, the Committee has not retained any such consultants or advisors to assist
it, although it may do so in the future if it deems it necessary.
COMPENSATION COMMITTEE INTERLOCKING
AND INSIDER PARTICIPATION
There are no interlocking relationships between any member of the Company's
Compensation Committee and any member of the compensation committee of any other
company, nor has any such interlocking relationship existed in the past. No
member of the Compensation Committee is or was formerly an officer or an
employee of the Company.
STOCKHOLDER COMMUNICATION WITH THE BOARD OF DIRECTORS
-----------------------------------------------------
Stockholders may communicate with the Board of Directors of the Company by
writing to: William E. Nielsen, Chief Financial Officer, Waste Technology
Corporation, 5400 Rio Grande Avenue, Jacksonville, FL 32254 or by E-Mail: to:
sales@intl-baler.com Subject: Communication to Board of Directors. All letters
and e-mails will be answered, if possible, and will be distributed to board
members as appropriate. Notwithstanding the foregoing, the Company has the
authority to discard or disregard any communication which is unduly hostile,
threatening, illegal or otherwise inappropriate or to take any other appropriate
actions with respect to such communications.
9
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
NUMBER OF SHARES PERCENT
NAME AND ADDRESS TITLE BENEFICIALLY OWNED(6) OF CLASS(7)
- ---------------- ----- --------------------- -----------
LaRita Boren Director 2,423,853 49.1%
9315 South 950 East
Upland, IN 46989
Leland E. Boren Director 220,768 4.5%
9315 South 950 East
Upland, IN 46989
Roger Griffin CEO, None -0-
5400 Rio Grande Avenue President
Jacksonville, FL 32254
Ronald McDaniel Director None -0-
5400 Rio Grande Avenue
Jacksonville, FL 32254
William E. Nielsen Director; 413,673(8) 8.0%
5400 Rio Grande Avenue Chief Financial
Jacksonville, FL 32254 Officer
Mathew M. Price Director None -0-
Bingham McHale LLP
2700 Market Tower
10 West Market Street
Indianapolis, IN 46204
David B. Wilhelmy Director, V. P. None -0-
5400 Rio Grande Avenue Sales & Marketing,
Jacksonville, FL 32254
All Officers and 3,058,2949 59.0%
Directors as a
Group (6 persons)
- --------------------
(6) Unless otherwise stated, all shares of Common Stock are directly held with
sole voting and dispositive power. The shares set forth in the table are as
of March 5, 2008.
(7) Calculated pursuant to Rule 13d-3(d) under the Securities Exchange Act of
1934 based upon 54,933,895 shares of common stock being outstanding as of
the record date, March 5, 2008. Shares not outstanding that are subject to
options or warrants exercisable by the holder thereof within 60 days of
March 5, 2008 are deemed outstanding for the purposes of calculating the
number and percentage owned by such stockholder, but not deemed outstanding
for the purpose of calculating the percentage of any other person. Unless
otherwise noted, all shares listed as beneficially owned by a stockholder
are actually outstanding.
(8) Consists of fully vested, exercisable options to purchase 250,000 shares
and 163,673 shares held by the Waste Technology Corporation Profit Sharing
Trust of which Mr. Nielsen is the Trustee.
(9) Consists of shares held directly, fully vested, exercisable options to
purchase 250,000 shares and shares held by Waste Technology Corporation
Employees Profit Sharing Trust.
10
CHANGE IN CONTROL
-----------------
To the knowledge of the Company's management, there are no present
arrangements or pledges of the Company's securities which may result in a change
in control of the Company.
BACKGROUND OF DIRECTORS
-----------------------
The following is a brief account of the experience, for at least the past
five (5) years, of each nominee for director.
LaRita R. Boren, age 71, was elected as a Director of the Company on March
9, 2005. Mrs. Boren is the Executive Director of Avis Industrial Corporation.
She has served as a member of the Board of Directors of Avis since 1979 and as
Vice-President from 1986 until April, 2006 when she was elected Executive
Director. She is also on the Board of Directors of The Boren Foundation, Inc.,
Citizens Plaza Building, LLC, Citizens Travel Agency, The Heartland Film
Festival, Lyford Cay Foundation Inc., J.M. Music, Inc., Taylor University,
LeLaLo Foundation, Inc., and Spring Hill Music Group, Inc. Mrs. Boren received a
Bachelors of Science degree from Oklahoma State University in 1957. She has an
honorary Doctor of Business Management degree from Indiana Wesleyan University
and a Doctor of Humane Letters degree from Taylor University. Mrs. Boren has
been married to Leland E. Boren, also a Director of Avis Industrial Corporation
since 1958.
Leland E. Boren, age 84, was elected as a Director of the Company on March
9, 2005. Mr. Boren is the Chairman, Chief Executive Officer and President of
Avis Industrial Corporation located in Upland, Indiana. From 1945 through 1971
Mr. Boren was employed by The Pierce Company (formerly The Pierce Governor
Company) in various capacities. He became President of The Pierce Governor
Company in 1958. The Pierce Company merged with Avis Industrial Corporation in
1971 and Mr. Boren became President of Avis at that time. Mr. Boren has been
married to LaRita R. Boren, who is also a Director of the Company since 1958.
Ronald L. McDaniel, age 68, was named to the Company's Board of Directors
on May 16, 2006. Mr. McDaniel has been president of Western-Cullen-Hayes, Inc.
since 1980. He was Vice President and General Manager of Western-Cullen-Hayes
from 1975 to 1980. From 1957 to 1975 Mr. McDaniel worked for
Western-Cullen-Hayes and Burro Crane, an affiliated company, in various
capacities including division controller. Mr. McDaniel has a bachelor's degree
from the University of Dayton and an MBA from the University of Chicago.
William E. Nielsen, age 60, joined the Company in June 1994 as its Chief
Financial Officer and was elected a Director on November 20, 1997. He was
elected President and Chief Executive Officer on May 8, 2001. Prior to joining
the Company, Mr. Nielsen acted as a financial consultant to Fletcher Barnum
Inc., a privately held manufacturing concern, from October 1993 through June
1994. From 1980 through July 1993, he was the Vice President, Administration and
Finance at Unison Industries, Inc. Mr. Nielsen received a BBA in Finance and an
M.B.A. at Western Illinois University in 1969 and 1970, respectively.
Mathew M. Price, age 40, is an attorney with the law firm of Bingham McHale
LLP since 1993. Mr. Price received a BA degree from Wabash Collage in 1990 and a
J.D. from Indiana University School of Law in 1993. Mr. Price is a member of the
Indiana State Bar Association, American Bar Association and the Indianapolis Bar
Association. Mr. Price is a member of his law firm's manufacturing industry
team, and his practice focus is on issues relating primarily to manufacturers.
Mr. Price was elected to the Company's board of directors on May 11, 2007.
David B. Wilhelmy, age 53, prior to joining the Company, Mr. Wilhelmy was
Vice President/Sales and Acquisitions for Consolidated Packaging Systems. CPS
was a joint venture with Gryphon Investors to consolidate the packaging systems
distribution industry, from January 2000 through August 2002. Mr. Wilhelmy was
the Southeast Regional Vice President of Sales and Marketing for Packaging for
Unisource Distribution Company from 1993 to 2000. Mr. Wilhelmy received a
Bachelor Degree in Business Administration from Madison University.
11
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
-------------------------------------------------------
In fiscal 2007, the Company, its officers and directors, were not
delinquent in filing of any of its Form 3, 4, and 5 reports.
FAMILY RELATIONSHIPS
--------------------
There are no family relationships between executive officers or directors
of the Company except that Leland E. Boren and LaRita R. Boren are husband and
wife who have a verbal agreement to vote their shares in a like manner.
Except as noted above, there is no understanding or arrangement between any
director or any other persons pursuant to which such individual was or is to be
selected as a director or nominee of the Company.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
----------------------------------------
To the knowledge of management, no director, executive officer or affiliate
of the Company or owner of record or beneficially of more than 5% of the
Company's common stock is a party adverse to the Company or has a material
interest adverse to the Company in any legal proceeding.
To the knowledge of management, during the past five years, no present or
former director, executive officer, affiliate or person nominated to become a
director or an executive officer of the Company:
(1) Filed a petition under the federal bankruptcy laws or any state
insolvency law, nor had a receiver, fiscal agent or similar officer
appointed by a court for the business or property of such person, or
any partnership in which he or she was a general partner at or within
two years before the time of such filing, or any corporation or
business association of which he or she was an executive officer at or
within two years before the time of such filing;
(2) Was convicted in a criminal proceeding or named the subject of a
pending criminal proceeding (excluding traffic violations and other
minor offenses);
(3) Was the subject of any order, judgment or decree, not subsequently
reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining him or her from or
otherwise limiting his or her involvement in any type of business,
commodities, securities or banking activities;
(4) Was found by a court of competent jurisdiction in a civil action or by
the SEC or the Commodity Futures Trading Commission ("CFTC") to have
violated any federal or state securities law or Federal commodities
law, and the judgment in such civil action or finding by the SEC or
CFTC has not been subsequently reversed, suspended, or vacated.
EXECUTIVE COMPENSATION
----------------------
The following table sets forth a summary of all compensation awarded to,
earned by or paid to, the Company's Chief Executive Officer and each of the
Company's executive officers whose compensation exceeded $100,000 per annum for
services rendered in all capacities to the Company and its subsidiaries during
fiscal years ended October 31, 2007, October 31, 2006, and October 31, 2005:
12
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG TERM AWARDS
- ----------------------------------------------------------------------------------------------------------------------------------
NAME AND YEAR SALARY BONUS STOCK OPTION NON-EQUITY CHANGE IN ALL OTHER TOTAL
PRINCIPAL AWARDS AWARDS INCENTIVE PENSION COMPENSATION COMPENSATION
POSITION PLAN VALUE &
COMPENSATION NONQUALIFIED
DEFERRED
COMPENSATION
EARNINGS
($) ($) ($) ($) ($) ($) ($) ($)
- ----------------------------------------------------------------------------------------------------------------------------------
William E. Nielsen 2007 131,440 12,500 -0- -0- -0- -0- -0- 143,940
Chief Financial 2006 122,768 10,000 -0- -0- -0- -0- -0- 132,768
Officer(3) 2005 104,271 3,000 -0- -0- -0- -0- -0- 107,271
David B. Wilhelmy 2007 129,602 12,500 -0- -0- -0- -0- -0- 142,102
Vice President 2006 121,517 10,000 -0- -0- -0- -0- -0- 131,517
Sales and Marketing 2005 102,848 3,000 -0- -0- -0- -0- -0- 105,848
Greg Kirkpatrick 2007 58,950 -0- -0- -0- -0- -0- -0- 58,950
Acting President(4)
- ----------------------------------------------------------------------------------------------------------------------------------
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
- ----------------------------------------------------------------------------------------------------------------------------------
Option Awards Stock Awards
- ----------------------------------------------------------------------------------------------------------------------------------
Name Number of Number of Equity Option Option Number Market Value Equity Equity
Securities Securities Incentive Exercise Expiration of of Shares or Incentive Incentive
Underlying Underlying Plan Price Date Shares Units of Plan Plan Awards:
Unexercised Unexercised Awards: ($) or Units Stock That Awards: Market or
Options (#) Options (#) Number of of Stock Have Not Number of Payout Value
Exercisable Unexercisable Securities That Vested (#) Unearned of Unearned
Underlying Have Not Shares, Shares,
Unexercised Vested (#) Units or Units or
Unearned Other Other Rights
Options (#) Rights That That Have
Have Not Not Vested
Vested (#) (#)
(a) (b) (c) (d) (e) (f) (g) (h) (i) (j)
- ----------------------------------------------------------------------------------------------------------------------------------
William E. 250,000 -0- -0- $0.30 2/7/2012 -0- -0- -0- -0-
Nielsen
Chief
Financial
Officer
- ----------------------------------------------------------------------------------------------------------------------------------
None of the Company's other Execu tive Officers earned compensation in
fiscal 2007, 2006, and 2005 in excess of $100,000 for services rendered to the
Company in any capacity. Two outside Directors of the Company received $1,000
per month for services as Directors during fiscal 2007.
- ------------------
(3) William Nielsen was President and CEO in 2005, 2006 and until September 18,
2007.
(4) Greg Kirkpatrick was acting President from September 18, 2007 to December
19, 2007.
13
GRANTS AND OPTION EXERCISES IN LAST FISCAL YEAR
-----------------------------------------------
No stock awards or options were granted or options exercised during fiscal
2007 by the Company's Chief Executive Officer or any of the Company's most
highly compensated executive officers whose compensation exceeded $100,000 for
Fiscal 2007.
AGREEMENTS
----------
The Company does not have any employment contracts, termination, severance
or change of control agreements with its Chief Executive Officer or any other
member of management.
COMPENSATION OF DIRECTORS
-------------------------
The Board of Directors of the Company has resolved to compensate
non-employee directors $1,000 per month, together with direct out-of-pocket
expenses incurred to attend meetings. LaRita Boren and Leland E. Boren waived
the monthly fees for fiscal 2007.
Members of the Board of Directors may also be requested to perform
consulting or other professional services for the Company from time to time. The
Board of Directors has reserved to itself the right to review all directors'
claims for compensation on an ad hoc basis.
Directors who are on the Company's Audit, Compensation, and Nomination
Committees are independent and therefore, do not receive any consulting,
advisory or compensatory fees from the Company. However, such Board members may
receive fees from the Company for their services on those committees.
- ---------------------------------------------------------------------------------------------------------------------
DIRECTOR COMPENSATION FOR FISCAL 2007
- ---------------------------------------------------------------------------------------------------------------------
Name Fees Stock Option Non Change All Other Total
Earned or Awards Awards Equity in Pension Value Compensation
Paid Incentive Plan and Nonqualified
in Cash Compensation Deferred Compensation
Earnings
($) ($) ($) ($) ($) ($) ($)
- ---------------------------------------------------------------------------------------------------------------------
Ronald L. 12,000 -0- -0- -0- -0- -0- 12,000
McDaniel
- ---------------------------------------------------------------------------------------------------------------------
Mathew M. Price 8,000 -0- -0- -0- -0- -0- 8,000
- ---------------------------------------------------------------------------------------------------------------------
14
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- ----------------------------------------------
RELATED PERSON TRANSACTIONS
---------------------------
Except as set forth hereafter, there have been no material transactions,
series of similar transactions or currently proposed transactions during Fiscal
2006 or 2007, to which the Company was or is to be a party, in which the amount
involved exceeds the lesser of $120,000 or one percent of the average of the
Company's total assets at year end for the last two Fiscal Years (2206 and 2007)
and in which any director or executive officer or any security holder who is
known to the Company to own of record or beneficially more than 5% of the
Company's common stock, or any member of the immediate family of any of the
foregoing persons, had a material interest.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
LaRita Boren and Leland E. Boren, both, shareholders and directors of the
Company, are the owners of Avis Industrial Corporation (Avis). Together the
Borens own 53.6% of the outstanding shares of the Company. Avis owns 100% of
American Baler Company, a competitor of the Company's International Baler
Corporation. These baler companies operate completely independent of each other.
In the fiscal year ending October 31, 2007 International Baler Corporation
had equipment sales to American Baler Company totalling $361,729. These sales
included types of products American Baler does not manufacture. These sales were
made under the Company's normal dealer discount schedule. International Baler
Corporation purchased no equipment from American Baler.
In July of 2007 the Company hired a consultant thru Avis, Mr. Greg
Kirkpatrick, for the purpose of improving the Company's manufacturing
operations. Mr. Kirkpatrick was named "Acting President" in September 2007. The
cost of the professional service and related expense to the Company was
approximately $70,000 through the end of the fiscal year. Kirkpatrick completed
his consulting project and left the Company in December of 2007.
PROCEDURES FOR APPROVAL OF RELATED PERSON TRANSACTIONS
Transactions between related persons, such as between an executive officer
or director and our company, or any company or person controlled by such officer
or director, are required to be approved by the Company's Audit Committee. The
Audit Committee Charter contains such explicit authority, as required by the
applicable rules of The Nasdaq Stock Market. It is the Company's preference to
avoid entering into a material related-party transaction if a transaction with a
non-related party is available on an equally timely and equally beneficial
basis. However, if a Related Person Transaction appears to be in the Company's
best interest then it will be approved or ratified if the Audit Committee
expressly finds that the terms of the transaction are comparable to or more
beneficial to the Company than those that could be obtained in arm's length
dealings with an unrelated third party.
INDEBTEDNESS OF MANAGEMENT
No officer, director or security holder known to the Company to own of
record or beneficially more than 5% of the Company's common stock or any member
of the immediate family of any of the foregoing persons is indebted to the
Company.
15
PARENT OF ISSUER
----------------
The Company has no parent.
BOARD RECOMMENDATION AND VOTE REQUIRED
- --------------------------------------
For Proposal No. 1 regarding the election of one (1) Class I Director,
votes may be cast in favor of the nominees or may be withheld. The Class I
Director will be elected by a plurality of the votes of the shares of the
Company's common stock present in person or represented by proxy, and entitled
to vote on the election of directors at a meeting at which a quorum is present.
Abstentions are tabulated in determining the votes present at a meeting.
Consequently, an abstention has the same effect as a vote against a director
nominee, as each abstention would be one less vote in favor of a director
nominee. The Board of Directors recommends that stockholders vote "FOR" the
Nominee set forth above. Unless marked to the contrary, proxies received will be
voted FOR the Nominee set forth above.
16
PROPOSAL NO. 2:
RATIFICATION OF SELECTION OF
KPMG LLP AS INDEPENDENT AUDITORS
The Board of Directors has selected the firm of KPMG LLP, independent
certified public accountants, to audit the accounts for the Company for fiscal
year ending October 31, 2008 ("Fiscal 2008"). The firm of KPMG LLP has audited
the Company's financial statements for the past ten (10) fiscal years. The
Company is advised that neither that KPMG LLP nor any of its partners has any
material direct or indirect relationship with the Company. The Board of
Directors considers KPMG LLP to be well qualified for the function of serving as
the Company's auditors. The Delaware General Corporation Law does not require
the approval of the selection of auditors by the Company's stockholders, but in
view of the importance of the financial statement to stockholders, the Board of
Directors deems it desirable that they pass upon its selection of auditors. In
the event the stockholders disapprove of the selection, the Board of Directors
will consider the selection of other auditors.
AUDIT AND NON-AUDIT FEES
------------------------
The following table presents the fees for professional audit services
rendered by KPMG LLP for the audit of the Company's annual consolidated
financial statements for the fiscal years ended October 31, 2007 and 2006, and
fees for other services rendered by KPMG LLP during those periods:
Fee Category Fiscal 2007 Fiscal 2006
Audit Fees $ 70,000 $ 67,500
Audit-Related Fees 0 0
Tax Fees $ 10,000 $ 11,000
All Other Fees 0 0
Total Fees $80,000 $ 78,500
Audit fees include fees related to the services rendered in connection with
the annual audit of the Company's consolidated financial statements, the
quarterly reviews of the Company's quarterly reports on Form 10-QSB and the
reviews of and other services related to registration statements and other
offering memoranda.
Audit-related fees are for assurance and related services by the
independent registered public accounting firm that are reasonably related to the
performance of the audit or review of the Company's financial statements.
Tax Fees include (i) tax compliance, (ii) tax advice, (iii) tax planning
and (iv) tax reporting.
All Other Fees includes fees for all other services provided by the
principal accountants not covered in the other categories such as litigation
support, etc.
All of the 2007 services described above were approved by the Audit
Committee in accordance with the SEC rule that requires audit committee
pre-approval of audit and non-audit services provided by the Company's
independent registered public accounting firm. The Audit Committee has
considered whether the provisions of such services, including non-audit
services, by KPMG LLP is compatible with maintaining KPMG LLP's independence and
has concluded that it is.
17
BOARD RECOMMENDATION AND VOTE REQUIRED
- --------------------------------------
The Board of Directors recommends that you vote in favor of the above
proposal in view of the quality of the services provided by KPMG LLP, its
outstanding reputation as a leading audit firm and its familiarity with the
Company's financial and other affairs due to its previous service as auditors
for the Company.
A representative of KPMG LLP is expected to be present at the Annual
Meeting with the opportunity to make a statement if he desires to do so, and is
expected to be available to respond to appropriate questions.
Ratification will require the affirmative vote of a majority of the shares
present and voting at the meeting in person or by proxy. In the event
ratification is not provided, the Board of Directors will review its future
selection of the Company's independent auditors.
Unless otherwise directed by the stockholder giving the proxy, the proxy
will be voted for the ratification of the selection by the Board of Directors of
KPMG LLP as the Company's independent certified public accountants for Fiscal
2008. Shares voted as abstaining will count as votes cast. Accordingly, an
abstention from voting by a stockholder present in person or by proxy at the
meeting has the same legal effect as a vote "against" Proposal No. 2 because it
represents a share present or represented at the meeting and entitled to vote,
thereby increasing the number of affirmative votes required to approve this
proposal.
STOCKHOLDERS' PROPOSALS
Proposals of stockholders intended to be presented at the 2008 annual
meeting must be received in writing, by the President of the Company at its
offices by November 19, 2008 in order to be considered for inclusion in the
Company's proxy statement relating to that meeting.
SEC rules and regulations provide that if the date of the Company's 2008
Annual Meeting is advanced or delayed more than 30 days from the date of the
2008 Annual Meeting, stockholder proposals intended to be included in the proxy
materials for the 2009 Annual Meeting must be received by the Company within a
reasonable time before the Company begins to print and mail the proxy materials
for the 2009 Annual Meeting. Upon determination by the Company that the date of
the 2008 Annual Meeting will be advanced or delayed by more than 30 days from
the date of the 2008 Annual Meeting, the Company will disclose such change in
the earliest possible Quarterly Report on Form 10-QSB.
By Order of the Board of Directors
Angela M. Taylor, SECRETARY
18
Appendix A
WASTE TECHNOLOGY CORP.
AUDIT COMMITTEE CHARTER
The Audit Committee shall be appointed by the Board of Directors to assist
the Board in fulfilling its oversight responsibilities relating to the Company's
(1) financial statements and auditing, accounting and related reporting
processes and (2) systems of internal controls regarding finance, accounting,
legal compliance and ethics established by management and the Board.
COMPOSITION
- -----------
The Audit Committee shall consist of at least three members of the Board,
each of whom shall meet the independence and experience requirements of
applicable laws, regulations, and stock market rules. The members of the Audit
Committee shall be appointed by the Board at the annual organizational meeting
of the Board, to serve until their successors shall be duly elected and
qualified. Unless a Chair is elected by the full Board, the members of the
Committee may designate a Chair by majority vote of the full Committee
membership.
RESPONSIBILITIES
- ----------------
The Audit Committee shall:
Documents/Reports Review
------------------------
- Review the annual audited financial statements with management and the
independent auditors, including major issues regarding accounting and auditing
principles and practices as well as the adequacy of internal controls that could
significantly affect the Company's financial statements, and recommend that the
audited financial statements be included in the Company's Annual Report on Form
10-K.
- Review with management and the independent auditors the Company's
quarterly financial statements.
- Review with management and the independent auditors the significant
financial reporting issues and judgments made in connection with the preparation
of the Company's financial statements and discuss any other matters communicated
to the Committee by the independent auditors.
- Prepare the report of the Audit Committee required by the rules of the
Securities and Exchange Commission to be included in the Company's annual proxy
statement.
1
Accounting and Financial Controls Framework
-------------------------------------------
- Review major changes to the Company's auditing and accounting principles
and practices as suggested by the independent auditors.
- Review with the independent auditors any management letter provided by
the independent auditors and the Company's responses to that letter. Such review
should include:
- Any difficulties encountered in the course of the audit work, including
any restrictions on the scope of activities or access to required information.
- Any changes required in the planned scope of the audit.
- The financial reporting department responsibilities and staffing.
Independent Auditors
--------------------
- Recommend to the Board the appointment of the independent auditors, which
firm is ultimately accountable to the Audit Committee and the Board.
- Approve the fees to be paid to the independent auditors.
- Receive disclosures from the independent auditors regarding the auditors'
independence required by Independence Standards Board Standard No. 1, discuss
such reports with the independent auditors, and, if so determined by the Audit
Committee, recommend that the Board take appropriate action to satisfy itself of
the independence of the auditors.
- Evaluate together with the Board the performance of the independent
auditors and, if so determined by the Audit Committee, recommend that the Board
replace the independent auditors.
- Meet with the independent auditors prior to the audit to review the
planning and staffing of the audit.
- Discuss with the independent auditors the matters required to be
discussed by Statement on Auditing Standards No. 61 relating to the conduct of
the audit.
Related Party Transactions
--------------------------
- Have the sole authority on behalf of the Company to authorize and approve
all transactions between the Company and a "Related Party". A "Related Party" is
any director or executive
2
officer of the Company, any nominee for director, any shareholder known to be
the beneficial owner of more than 5% of any class of the Company's voting stock,
and any Immediate Family Member of any such Party. "Immediate Family Member"
means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law of a
person, and any person (other than a tenant or an employee) sharing the
household of such person.
GENERAL AUTHORITY AND RESPONSIBILITIES
- --------------------------------------
The Audit Committee shall have the authority to retain special legal,
accounting or other consultants to advise the Committee. The Audit Committee may
request any officer or employee of the Company or the Company's outside counsel
or independent auditors to attend a meeting of the Committee or to meet with any
members of, or consultants to, the Committee.
While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditors. Nor is it
the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent auditors or to
ensure compliance with laws and regulations.
The Audit Committee shall review and reassess the adequacy of this Charter
annually and recommend any proposed changes to the Board.
3
WASTE TECHNOLOGY CORP.
THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS
The undersigned hereby appoints LaRita R. Boren and Ronald L. McDaniel as
proxies (the "Proxies"), each with power of substitution and resubstitution, to
vote all shares of Common Stock, $.01 par value per share, of Waste Technology
Corp. (the "Company") held of record by the undersigned on March 5, 2008 at the
Annual Meeting of stockholders to be held at the offices of the Company, 5400
Rio Grande Avenue, Jacksonville, Florida 32254, on Monday, April 21, 2008 at
10:00 A.M. local time, or at any adjournments thereof, as directed below, and in
their discretion on all other matters coming before the meeting or any
adjournments thereof.
PLEASE MARK BOXES / / IN BLUE OR BLACK INK.
1. Election of two Class I Directors: Leland E. Boren and Mathew M. Price
(MARK ONLY ONE OF THE TWO BOXES FOR THIS ITEM)
/ / VOTE FOR all nominees named above except those who may be named on
this line:
---------------------------------------------------------------------------
(OR)
/ / VOTE WITHHELD as to all nominees named above.
2. Proposal to ratify appointment of KPMG LLP as the Company's independent
certified public accountants:
FOR / / AGAINST / / ABSTAIN / /
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
When properly executed, this Proxy will be voted as directed. If no
direction is made, this Proxy will be voted "FOR" Proposals 1 and 2.
PLEASE MARK, DATE, SIGN AND RETURN THIS PROXY PROMPTLY IN THE ENCLOSED
ENVELOPE.
PLEASE SIGN EXACTLY AS NAME APPEARS HEREON. WHEN SHARES ARE HELD BY JOINT
TENANTS, BOTH SHOULD SIGN. WHEN SIGNING AS ATTORNEY OR EXECUTOR, ADMINISTRATOR,
TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE AS SUCH. IF A CORPORATION, PLEASE
SIGN IN FULL CORPORATE NAME BY PRESIDENT OR OTHER AUTHORIZED OFFICER. IF A
PARTNERSHIP, PLEASE SIGN IN PARTNERSHIP NAME BY AUTHORIZED PERSON.
Dated: ____________________, 2008
X _______________________________
Signature
X _______________________________
Print Name(s)
X _______________________________
Signature, if held jointly