alti_def14a-041609.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE 14A
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:
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Preliminary
Proxy Statement
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o
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Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
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x
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Definitive
Proxy Statement
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o
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Definitive
Additional Materials
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o
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Soliciting
Material Pursuant to §240.14a-12
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Altair Nanotechnologies
Inc.
(Name
of Registrant as Specified In Its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
x
|
No
fee required.
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o
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
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|
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(1)
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Title
of each class of securities to which transaction
applies:
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(2)
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Aggregate
number of securities to which transaction
applies:
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(3)
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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)
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Proposed
maximum aggregate value of
transaction:
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o
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Fee
paid previously with preliminary
materials.
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o
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Check
box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and
identify the filing for which the offsetting fee was paid
previously. Identify the previous
filing by registration statement number, or the Form or Schedule and the
date of its
filing.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement
No.:
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(3)
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Filing
Party:
________________________________________________________________________________________
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(4)
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Date
Filed:
________________________________________________________________________________________
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ALTAIR
NANOTECHNOLOGIES INC.
204
Edison Way
Reno,
Nevada 89502
U.S.A.
MANAGEMENT
INFORMATION CIRCULAR
AND
PROXY STATEMENT
APRIL
16, 2009
Important
Notice Regarding the Availability of Proxy Materials for the Annual Meeting to
be held on June 4, 2009. The Corporation’s Proxy Statement and Annual
Report to Stockholders for the fiscal year ended December 31, 2008 are available
on the Internet at http:// www.altairannualmeeting.com.
Solicitation of
Proxies
THIS MANAGEMENT INFORMATION CIRCULAR
AND PROXY STATEMENT (THE “INFORMATION CIRCULAR”) IS FURNISHED IN CONNECTION WITH
THE SOLICITATION BY THE MANAGEMENT OF ALTAIR NANOTECHNOLOGIES INC. (THE
“CORPORATION”) OF PROXIES TO BE USED AT THE ANNUAL MEETING OF SHAREHOLDERS OF
THE CORPORATION TO BE HELD AT THE TIME AND PLACE AND FOR THE PURPOSES SET FORTH
IN THE ENCLOSED NOTICE OF MEETING (THE “MEETING”). This
Information Circular, the Notice of Meeting attached hereto, and the
accompanying form of proxy and the Annual Report of the Corporation for the year
ended December 31, 2008 are first being mailed to the shareholders of the
Corporation on or about May 5, 2009. It is expected that the solicitation will
be primarily by mail, but proxies may also be solicited personally, by email, by
facsimile or by telephone by officers and employees of the Corporation without
additional compensation therefore. If one or more shareholders files
a proxy statement or solicits proxies in opposition to the recommendations of
the board of directors of the Corporation (the “Board of Directors” or the
“Board”), the Corporation may engage outside solicitors to assist with its
solicitation of proxies. Details regarding any such engagement would
be set forth in a supplement to this Information Circular.
The cost
of solicitation by management will be borne directly by the
Corporation. Arrangements will be made with brokerage firms and other
custodians, nominees and fiduciaries for the forwarding of solicitation
materials to the beneficial owners of the Common Shares of the Corporation
(“Common Shares”) held by such persons, and the Corporation will reimburse such
brokerage firms, custodians, nominees and fiduciaries for the reasonable
out-of-pocket expenses incurred by them in connection therewith.
Appointment and Revocation
of Proxies
The
persons named in the enclosed form of proxy are officers and/or directors of the
Corporation. A
SHAREHOLDER DESIRING TO APPOINT SOME OTHER PERSON TO REPRESENT HIM AT THE
MEETING MAY DO SO either by inserting such person’s name in the blank
space provided in that form of proxy or by completing another proper form of
proxy and, in either case, depositing the completed proxy at the office of the
transfer agent indicated on the enclosed envelope not later than 48 hours
(excluding Saturdays and holidays) before the time of holding the Meeting, or by
delivering the completed proxy to the chairman of the Board of Directors on the
day of the Meeting or adjournment thereof.
A proxy
given pursuant to this solicitation may be revoked by instrument in writing,
including another proxy bearing a later date, executed by the shareholder or by
his attorney authorized in writing, and deposited either at the Corporation’s
principal office located at 204 Edison Way, Reno, Nevada, 89502, U.S.A. at any
time up to and including the last business day preceding the day of the Meeting,
or any adjournment thereof, at which the proxy is to be used, or with the
chairman of such Meeting on the day of the Meeting, or adjournment thereof, or
in any other manner permitted by law.
Voting of
Proxies
THE
COMMON SHARES REPRESENTED BY A DULY COMPLETED PROXY WILL BE VOTED OR WITHHELD
FROM VOTING IN ACCORDANCE WITH THE INSTRUCTIONS OF THE SHAREHOLDER ON ANY BALLOT
THAT MAY BE CALLED FOR AND, IF THE SHAREHOLDER SPECIFIES A CHOICE WITH RESPECT
TO ANY MATTER TO BE ACTED UPON, SUCH COMMON SHARES WILL BE VOTED
ACCORDINGLY. UNLESS OTHERWISE INDICATED ON THE FORM OF PROXY, SHARES
REPRESENTED BY PROPERLY EXECUTED PROXIES IN FAVOR OF PERSONS DESIGNATED IN THE
PRINTED PORTION OF THE ENCLOSED FORM OF PROXY WILL BE VOTED (I) TO ELECT
MANAGEMENT’S SEVEN NOMINEES FOR DIRECTOR, AND (II) TO APPOINT PERRY SMITH LLP AS
THE CORPORATION’S INDEPENDENT PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING
DECEMBER 31, 2009. The enclosed form of proxy confers discretionary
authority upon the persons named therein with respect to amendments or
variations to matters identified in the notice of Meeting, or other matters
which may properly come before the Meeting. At the time of printing
this Information Circular, management of the Corporation knows of no such
amendments, variations or other matters to come before the Meeting.
Voting Securities and
Principal Holders of Voting Securities
The
authorized capital of the Corporation consists of an unlimited number of Common
Shares. As of April 6, 2009, the Corporation had 93,153,271 Common Shares
issued and outstanding.
The
Corporation shall make a list of all persons who are registered holders of
Common Shares as of the close of business on April 6, 2009 (the “Record Date”)
and the number of Common Shares registered in the name of each such person on
that date. Each shareholder is entitled to one vote for each Common
Share registered in his name as it appears on the list.
One-third
of the outstanding Common Shares entitled to vote, represented in person or by
properly executed proxy, is required for a quorum at the
Meeting. Abstentions will be counted as “represented” for purposes of
determining the presence or absence of a quorum. Complete broker
non-votes, which are indications by a broker that it does not have discretionary
authority to vote on any of the matters to be considered at the Meeting, will
not be counted as “represented” for the purpose of determining the presence or
absence of a quorum.
To the
knowledge of the directors and executive officers of the Corporation, as of
April 6, 2009, only one holder, Al Yousuf, LLC, directly or indirectly,
exercises control or direction of over more than 10% of the Common Shares
outstanding. According to a Schedule 13D filed by Al Yousuf, LLC and
affiliates on October 8, 2008, the affiliate group beneficially owns 20,095,038
Common Shares representing 21.6% of the outstanding Common Shares as of April 6,
2009.
Under the
Canada Business Corporations Act
(the “CBCA”), once a quorum is established, in connection with the election of
directors, the seven nominees receiving the highest number of votes will be
elected. In order to approve the proposal in respect of the
appointment of the corporation’s independent public accounting firm, the votes
cast in favour of such proposal must exceed the votes
withheld. Abstentions and broker non-votes will not have the effect
of being considered as votes cast against any of the matters considered at the
Meeting.
Exchange Rate
Information
The
following exchange rates represent the noon buying rate in New York City for
cable transfers in Canadian Dollars (CDN. $), as certified for customs purposes
by the Federal Reserve Bank of New York. The following table sets
forth, for each of the years indicated, the period-end exchange rate, the
average rate (i.e., the average of the exchange rates on the last day of each
month during the period), and the high and low exchange rates of the U.S. Dollar
(U.S. $) in exchange for the Canadian Dollar (CDN. $) for the years indicated
below, based on the noon buying rates.
For
the Year Ended December 31,
|
|
2008
|
2007
|
2006
|
2005
|
2004
|
(Each
U.S. Dollar Purchases the Following Number of Canadian
dollars)
|
High
|
1.3013
|
1.1852
|
1.1726
|
1.2703
|
1.3970
|
Low
|
0.9709
|
0.9168
|
1.0989
|
1.1507
|
1.1775
|
Average
|
1.0667
|
1.0734
|
1.1340
|
1.2083
|
1.2984
|
Year
End
|
1.2228
|
0.9881
|
1.1652
|
1.1656
|
1.2034
|
PROPOSAL
NO. 1 — ELECTION OF DIRECTORS
The
Articles of Continuance of the Corporation (the “Articles”) provide that the
Board may consist of a minimum of three and a maximum of nine directors, to be
elected annually. Each director will hold office until the next
annual meeting or until his successor is duly elected unless his office is
earlier vacated in accordance with the by-laws of the
Corporation. Pursuant to the Articles, the Board has been empowered
to set the size of the Board, subject to any limitations set forth in the
Articles or the CBCA. The Articles provide that the Board may,
between meetings of shareholders, appoint one or more additional directors, but
only if, after such appointment, the total number of directors would not be
greater than one and one-third times the number of directors required to have
been elected at the last annual meeting of shareholders. As of the end of the
2008 annual shareholder meeting, the Board was composed of six
directors. During 2008 the Board was increased by two members and the
entire Board is currently composed of eight directors. Mr.
Bazinet has resigned as a Director of the Corporation effective June 3,
2009. The Board has accepted Mr. Bazinet’s resignation and coincident
with it reduced the size of the Board from eight members to seven.
Certain
information with respect to the seven nominees of the Board for election as
directors is set forth in the table below:
Name
& Province/State
and
Country
|
Office
with
Corporation
|
Period
of Service as
a
Director
|
Number
of Common Shares Beneficially
Owned
or Over Which Control or
Direction
is Exercised as of
March
31, 2009(1)
|
|
|
|
|
Jon
N. Bengtson
|
Chairman(A)
|
Since
2003
|
58,556
|
Nevada,
U.S.A.
|
|
|
|
|
|
|
|
Eqbal
Al Yousuf
|
Director(B)
|
Since
October 2008
|
20,105,038(2)
|
Dubai,
U.A.E.
|
|
|
|
|
|
|
|
Terry
Copeland
|
Director
and Chief Executive Officer
|
Since
June 2008
|
108,137(3)
|
Nevada,
U.S.A.
|
|
|
|
|
|
|
George
Hartman
|
Director(A)
|
Since
1997
|
144,856(4)
|
Ontario,
Canada
|
|
|
|
|
|
|
|
Robert
Hemphill
|
Director
|
Since
2007
|
934,255(5)
|
Maryland,
U.S.A.
|
|
|
|
|
|
|
|
Pierre
Lortie
|
Director(A)
(B)
|
Since
2006
|
28,115
|
Quebec,
Canada
|
|
|
|
|
|
|
|
Robert
G. van Schoonenberg
|
Director(A)
(B)
|
Since
April 2008
|
38,815
|
California,
U.S.A.
|
|
|
|
(A)
Member of Audit Committee
(B)
Member of Compensation, Corporate Governance and Nominations Committee (the
“Compensation and Nominating Committee”)
|
(1)
|
The
information as to Common Shares beneficially owned or over which control
or direction is exercised is not within the knowledge of the Corporation
and has been furnished by the respective nominees
individually. This information includes all Common Shares
issuable pursuant to the exercise of options that are exercisable within
60 days of March 31, 2009. This information does not include
any Common Shares subject to options that are not exercisable within 60
days of March 31, 2009 or subject to options that vest only upon the
occurrence of events, such as a rise in the market price of the Common
Shares, outside of the control of the
optionee.
|
|
(2)
|
The
owner of record of 20,095,038 of these shares is Al Yousuf LLC; however,
Mr. Al Yousuf has voting control and investment discretion over these
securities.
|
|
(3)
|
Includes
106,250 Common Shares subject to options granted to Mr. Copeland pursuant
to the Corporation’s 2005 Stock Incentive Plan (Amended and Restated) (the
“2005 Plan”).
|
|
(4)
|
Includes
85,000 Common Shares subject to options granted to Mr. Hartman pursuant to
the Corporation’s 1998 Stock Option Plan (the “1998
Plan”). Includes 500 Common Shares owned by Julie Bredin, the
spouse of Mr. Hartman.
|
|
(5)
|
The
owner of record of 895,523 of these shares is The AES Corporation;
however, Mr. Hemphill has voting control and investment discretion over
these securities. Mr. Hemphill has no direct financial interest
in such securities and disclaims beneficial ownership of these
securities. Also includes 2,666 Common Shares vested through
the dates noted in (1) above, subject to options granted to Mr. Hemphill
pursuant to the 2005 Plan.
|
IF ANY OF
THE NOMINEES IS FOR ANY REASON UNAVAILABLE TO SERVE AS A DIRECTOR, PROXIES IN
FAVOR OF MANAGEMENT WILL BE VOTED FOR ANOTHER NOMINEE IN THEIR DISCRETION UNLESS
THE SHAREHOLDER HAS SPECIFIED IN THE PROXY THAT HIS SHARES ARE TO BE WITHHELD
FROM VOTING IN THE ELECTION OF DIRECTORS.
Set forth
below is a description of each of the directors of the Corporation who is
nominated for election at the Meeting and each of the executive officers of the
Corporation, including their principal occupations for the past five
years.
Directors
Jon N. Bengtson, 65, has been
a director of the Corporation since July 2003 and was appointed Chairman of the
Board in June 2004. He served as the chairman of the board of The Sands Regent
Hotel Casino until its acquisition in January 2007 and served as chairman of the
board of Radica Games Limited until its acquisition by Mattel, Inc. in October
2006. Mr. Bengtson began his career with Harrah's Entertainment,
Inc., where he served for nine years in various management positions, including
vice president of management information systems. He joined International Game
Technology in 1980 as vice president, chief financial officer and director and
was subsequently promoted to vice president of marketing in 1982. Mr. Bengtson
joined The Sands Regent Hotel Casino in June 1984 and served in various
positions, including vice president of finance and administration, chief
financial officer, treasurer and director, senior vice president and director,
executive vice president, chief operating officer and director until December
1993. In January 1994, he joined Radica Games Limited as vice president and
chief financial officer and was appointed president and chief executive officer
of Radica USA Ltd. in December 1994 and served as chairman of the board from
January 1996 until October 2006. Mr. Bengtson was a founder and chief financial
officer of ShareGate, Inc., a venture-funded telecommunications equipment
company from March 1996 until October 2001. Mr. Bengtson is also the founder and
director for Pinyon Technology, a start-up technology corporation developing
wireless smart antenna networking technology. He holds a bachelor’s degree in
business administration and a master of business administration from the
University of Nevada, Reno.
Eqbal Al Yousuf, 51, has been
a director of the Corporation since October 2008. Mr. Al Yousuf
joined his father’s firm, Al Yousuf, LLC, in June 1983 as managing director, and
he was appointed as deputy chairman in 1988, vice chairman in 2001, and chief
executive president in 2004. During his tenure with Al Yousuf, LLC,
Mr. Al Yousuf has helped grow it into a significant company in the Middle East
with markets stretching into the Indian sub-continent, Asia, Europe and the
U.S. Al Yousuf, LLC has grown into a multi-million dirham
conglomerate with operations ranging from motor vehicles, auto rental and real
estate development to home electrical appliances, state-of-the-art electronics
and computer operating systems. In December 2007, Mr. Al Yousuf was elected to
the board of directors of ZAP, Inc., a provider of electric and high technology
vehicles, and became the chairman of the board of ZAP in August 2008. Mr. Al
Yousuf is actively involved with numerous social and environmental
causes. He holds two bachelors degrees, one in computer science and
the other in economics, both from the University of Minnesota.
Terry M. Copeland, 57, was
appointed President of the Corporation in February 2008 and Chief Executive
Officer and a director of the Corporation in June 2008. Dr. Copeland
joined the Corporation in November 2007 as Vice President, Operations for the
Power and Energy business unit of Altairnano, Inc., the operating subsidiary
through which the Corporation conducts its nanotechnology
business. Prior to joining the Corporation, Dr. Copeland worked as a
general manufacturing and technical consultant from 2004 through the end of
2007. From 2000 through 2003, Dr. Copeland was the vice president of
product development at Millennium Cell, Inc., a development stage company
working with alternative fuels. From 1992 through 2000, Dr. Copeland
worked for Duracell, a leading consumer battery company, where he held positions
as director of product development (1998 to 2000), plant manager (1995 to 1998)
and director of engineering (1992 to 1995). Dr. Copeland also worked for E.I.
DuPont De Nemours & Co., Inc. from 1978 to 1992, where his positions
included research engineer, technical manager and manufacturing
manager. Dr. Copeland earned a bachelor’s degree in chemical
engineering from the University of Delaware and earned a doctor of philosophy
degree in chemical engineering from the Massachusetts Institute of
Technology.
George E. Hartman, 60, was
elected a director of the Corporation in March 1997. From 1995 until
1998, Mr. Hartman served as president of Planvest Pacific Financial Corp., a
Vancouver-based financial planning firm with U.S. $1 billion of assets under
management. He also served on the board of directors of the parent
firm, Planvest Capital Corp. (TSE:PLV). From 1998 until 2000, Mr.
Hartman was a vice president of Financial Concept Group until the firm’s sale to
Assante Corporation, a North American financial services industry
consolidator. At that time, he became CEO of PlanPlus Inc., Canada’s
oldest firm specializing in wealth management software for the financial
services industry worldwide. Today, Mr. Hartman continues as CEO
& president of Market Logics Inc. (originally Hartman & Company Inc.), a
firm he founded in 1991 which provides research and consulting services to
businesses, professional organizations and individuals. Since 2004,
Mr. Hartman has also served as executive vice president of The Covenant Group, a
management-consulting firm where Mr. Hartman is the author of two best-selling
books: Risk is a Four -Letter Word-The Asset Allocation Approach to Investing
(1992), and its sequel, Risk is STILL a Four Letter Word
(2000). Other directorships include: PlanPlus Inc. (software); SOS
Together Inc. (environmental education). Mr. Hartman holds a master
of business administration degree from Wilfred Laurier University in Waterloo,
Ontario.
Robert F. Hemphill, Jr., 65,
has been a director of the Corporation since May 2007. Mr. Hemphill
is president and chief executive officer of AES Solar. Mr. Hemphill
has served as executive vice president of The AES Corporation (NYSE:AES) since
2005. AES is one of the world’s largest global power companies with operations
in 26 countries on five continents. Mr. Hemphill joined AES in 1981 and has held
a series of senior leadership positions, including serving as AES’s executive
vice president of global development from 2003 to 2004. Earlier in his tenure,
he participated in or oversaw the development of many of AES’s earliest
projects. Mr. Hemphill resigned from The AES Corporation in June 1996
and subsequently returned in January 2003. Mr. Hemphill also served
as a member of the AES board of directors from June 1996 to February
2004. From 1995 to 2002, Mr. Hemphill served as the managing director
of Toucan Capital Fund II, L.P., a $120 million private venture capital fund
focused on seed and early-stage life science and advanced technology
investments. Prior to joining AES in 1981, Mr. Hemphill held senior management
positions with the Tennessee Valley Authority, the U.S. Department of Energy and
the U.S. Office of Management and Budget. Mr. Hemphill holds a
bachelor’s degree in political science from Yale University, a master’s degree
in political science from the University of California, Los Angeles, and a
master of business administration degree from The George Washington
University.
Pierre Lortie, 62, has been a
director of the Corporation since June 2006. Since May 2006, Mr. Lortie has
served as senior business advisor to Fraser Milner Casgrain LLP, one of Canada's
leading full service business law firms serving both Canadian and international
clients. From June 2004 to December 2005, Mr. Lortie was the
president of the Transition Committee of the Agglomeration of
Montreal. Since April 2004, Mr. Lortie also serves as the president
of G&P Montrose, a management consulting company. Mr. Lortie
worked at Bombardier from April 1990 to December 2003, where he served as
president and COO of Bombardier’s transportation, capital, international and
regional aircraft aerospace groups. Mr. Lortie has held several
positions in the technology field, including chairman of the Centre for
Information Technology Innovation and vice chairman of Canada’s National Advisor
Board on Science and Technology. Mr. Lortie was a representative of
the Prime Minister of Canada on the APEC Business Advisory Council (ABAC) from
1999 to 2004. He currently serves as chairman of the board of Country Style Food
Services, a private corporation engaged in quick food restaurant services, and
is a director of Dynaplas, a private corporation engaged in precision injection
moulding manufacturing for the automotive industry, and Group Canam (TSX-V:CAM),
a public corporation engaged in the design and fabrication of construction
products and solutions. A professional engineer, Mr. Lortie holds a
bachelor’s degree in applied sciences in engineering physics from Université
Laval, a degree in applied economics from the Université de Louvain, Belgium,
and a master of business administration degree with honors from the University
of Chicago. Additionally, he has received the honorary degree of
doctorate honoris causa from Bishop’s University. Mr. Lortie was
appointed Member of the Order of Canada in 2001.
Robert G. van Schoonenberg,
62, has been a director of the Corporation since April,
2008. Since January 2008, Mr. van Schoonenberg has been chairman and
chief executive officer of BayPoint Capital Partners, LLC a private
equity/advisory firm in Newport Beach, California. He has also served
as chairman of the board of Premiere Entertainment, LLC since March
2008. From 1981 through December 2008, Mr. van Schoonenberg
previously served as executive vice president, chief legal officer and secretary
to the board of directors of Avery Dennison Corporation (NYSE:
AVY.) Prior to joining Avery Dennison Corporation in 1981, he was at
Gulf Oil Corporation as a member of the corporate general counsel’s staff since
1974. Mr. van Schoonenberg is on the board of Guidance Software, Inc.
(NASDAQ: GUID.) He is a trustee of the Southwestern University Law
School and the Avery Dennison Foundation. He is past director of the
University of Wisconsin Graduate School of Business Advisory
Board. He is a member of the Audit Committee Roundtable of Orange
County. His educational background includes a bachelor’s degree in
economics from Marquette University, a master of business administration degree
in finance from the University of Wisconsin and a juris doctorate from the
University of Michigan. He served in the United States Army, military
intelligence, in Munich, Germany.
Executive
Officers
The
executive officers of the Corporation are Terry M. Copeland, John C. Fallini,
Bruce J. Sabacky, Stephen A. Balogh, C. Robert Pedraza and Daniel
Voelker. On February 27, 2008, Alan J. Gotcher was terminated as an
officer of the Corporation, and the Board of Directors appointed Terry M.
Copeland as President. On April 7, 2008, John Fallini was appointed as Chief
Financial Officer of the Corporation, replacing Edward Dickinson, who remains
employed as Senior Director Programs and Contracts. On June 16, 2008,
C. Robert Pedraza was appointed to the position of Vice President of Corporate
Strategy and on November 24, 2008, Daniel Voelker was promoted into the position
of Vice President of Engineering and Operations. On September 6,
2008, Jeffrey A. McKinney resigned as an officer of the
Corporation. Information regarding Mr. Copeland is presented in
“Directors” immediately above. Certain information regarding Messrs.
Fallini, Sabacky, Balogh, Pedraza and Voelker follows.
John C. Fallini, 60, joined
the Corporation on April 7, 2008 as the Chief Financial Officer and was
appointed as Secretary of the Corporation in February 2009. Prior to
joining the Corporation, Mr. Fallini served as the chief financial officer for
Alloptic, Inc., a private corporation that produces passive optical network
access equipment for the telecommunications and cable TV industries from January
2007 to March 2008. From 2004 through 2006, Mr. Fallini was an
independent consultant specializing in financial services and providing interim
CFO support to companies in a number of different industries. From
2000 through 2003, Mr. Fallini served as the chief financial officer for
Informative, Inc., a private corporation that sold customer voice management
software that allowed real time dialogue with customers via the
internet. From 1998 to 2000 Mr. Fallini served as the chief operating
officer of Butterfields, the fourth largest fine arts auctioneer in the world,
and from 1976 to 1998 Mr. Fallini served in a variety of management positions
with Pacific Bell in both the regulated and deregulated sides of the
company. Mr. Fallini obtained a bachelor of science degree in
engineering and applied science from the University of California, Los Angeles
and a master of business administration degree in finance with high honors from
Oklahoma City University.
Bruce J. Sabacky, 58, was
appointed Chief Technology Officer of the Corporation in June
2006. Dr. Sabacky was appointed Vice President of Research and
Engineering for Altairnano, Inc., the operating subsidiary through which the
Corporation conducts its nanotechnology business, in October
2003. Dr. Sabacky joined Altairnano, Inc. in January 2001 as Director
of Research and Engineering. Prior to that, he was the manager of
process development at BHP Minerals Inc.’s Center for Minerals Technology from
1996 to 2001, where he was instrumental in developing the nanostructured
materials technology. Dr. Sabacky was the technical superintendent
for Minera Escondida Ltda. from 1993 to 1996 and was a principal process
engineer with BHP from 1991 to 1993. Prior to that, he held senior
engineering positions in the minerals and metallurgical
industries. Dr. Sabacky obtained a bachelor of science and a master
of science degree in metallurgical engineering from the South Dakota School of
Mines and Technology and a doctor of philosophy degree in materials science
& mineral engineering with minors in chemical engineering and mechanical
engineering from the University of California, Berkeley.
Stephen
A. Balogh, 62, joined the Corporation as Vice President, Human Resources,
in February 2007. In 2001, Mr. Balogh founded PontusOne, providing
executive search and consulting services to technology companies, where he
continued to work through 2007. Before founding PontusOne, Mr. Balogh was a
managing partner of David Powell, Inc., a Silicon Valley based executive search
firm from 1997 to 2001. Previously, Mr. Balogh served more than twenty three
years in various managerial positions at Raychem Corporation, a
multibillion-dollar, international material science company. In his
last position, he served as Raychem’s corporate vice president of human
resources from 1990 through 1996. From 1984 to 1990 at Raychem, Mr. Balogh was
general manager for Chemelex, a worldwide division of Raychem. His extensive
global business experience with Raychem includes expatriate assignments in both
Brussels and Paris. Mr. Balogh holds a bachelor of science degree and a Dean’s
Certificate of Advanced Engineering Study in chemical engineering from Cornell
University and a masters of business administration degree from the Stanford
Graduate School of Business.
C.
Robert Pedraza, 47, joined the corporation in July 2005 as Vice President
- Strategy and Business Development. He was then appointed as Vice
President, Corporate Strategy in June 2008. Previously, Mr. Pedraza
founded Tigré Trading, an institutional equity trading boutique which
facilitated transactions for hedge funds and assisted in fund raising from July
2002 through May 2005. Prior to that Mr. Pedraza held senior sales roles with
Fidelity Investments Institutional Services Company, Alliance Capital Management
L.P., Compass Bancshares, Inc. and Prudential-Bache Securities, Inc. Mr. Pedraza
received his bachelor’s degree in business and economics from
Lehigh University where he was a recipient of the Leonard P. Pool
Entrepreneurial Scholarship. He also completed the Graduate Marketing
Certificate Program at the Southern Methodist University Cox School of
Business.
Daniel S. Voelker, 55, joined
the Corporation as Vice President, Operations for Power & Energy Systems in
April 2008, and was promoted to Vice President, Engineering & Operations in
November 2008. Prior to joining the Corporation, Mr. Voelker was the
vice president of business development and sales for Wes-Tech Automation
Solutions, a systems integration business supplying the automotive industry,
where he also served as the vice president of operations during his employment
from June 2004 through April 2008. From May 1999 through June 2004,
Mr. Voelker served DT Industries, Inc in several key leadership roles, including
director of engineering, director of program management, and finally as the
general manager of DT’s Chicago operation. From November 1982 through
April 1999, Mr. Voelker served Duracell in increasing levels of responsibility
during more than sixteen years with the company. His job
responsibilities included project engineer, systems engineering manager, plant
engineering manager for Duracell’s lithium manufacturing operation, and director
of equipment engineering for Duracell world-wide. He played a key
role in Duracell product launches of lithium battery products and lithium plant
startup, the on-cell battery tester, ultra alkaline batteries, as well as key
capacity expansion initiatives for alkaline batteries globally. Mr.
Voelker graduated from the University of Nebraska with a bachelor’s degree in
mechanical engineering.
Security
Ownership of Certain Beneficial Owners and
Management
Set forth
below is information with respect to beneficial ownership of Common Shares as of
March 31, 2009 by the named executive officers (as defined below) currently
employed with the Corporation, by each of the directors of the Corporation, by
all current executive officers and directors of the Corporation as a group and
by each person known to the Corporation to beneficially own 5% or more of the
outstanding Common Shares. The “named executive officers” are the
Corporation’s Chief Executive Officer, former Chief Executive Officer, Chief
Financial Officer, former Chief Financial Officer, the three other most highly
compensated continuing executive officers during 2008, and one additional
individual that would have been among the three most highly compensated
continuing executive officers during 2008 but for the fact that the individual
was not serving as an executive officer at the end of 2008. The table
below does not include information with respect to the beneficial ownership of
shares by Alan Gotcher, the Corporation’s former Chief Executive Officer, or
Jeffrey McKinney, the Corporation’s former Vice President and Chief Patent
Counsel, as such information is not available to the
Corporation. Unless otherwise indicated, each of the shareholders
named in the table has sole voting and investment power with respect to the
Common Shares identified as beneficially owned. The Corporation is
not aware of any arrangements, the operation of which may at a subsequent date
result in a change in control of the Corporation.
Title
of
Class
|
Name
of Officer or Director
|
Amount
and
Nature
of
Beneficial
Ownership
(1)
|
Percentage
of
Class (2)
|
Common
|
Terry
M. Copeland (Chief Executive Officer and Director)
|
108,137(3)
|
*
|
Common
|
John
C. Fallini (Chief Financial Officer and Secretary)
|
37,500(4)
|
*
|
Common
|
Bruce
J. Sabacky (Vice President and Chief Technology Officer)
|
203,940(5)
|
*
|
Common
|
Stephen
A. Balogh (Vice President, Human Resources)
|
195,018(6)
|
*
|
Common
|
C.
Robert Pedraza (Vice President, Corporate Strategy)
|
188,213(7)
|
*
|
Common
|
Edward
H. Dickinson (Former Chief Financial Officer)
|
425,415(8)
|
*
|
Common
|
Eqbal
Al Yousuf (Director)
|
20,105,038(9)
|
21.6%
|
Common
|
Michel
Bazinet (Director)
|
37,311
|
*
|
Common
|
Jon
N. Bengtson (Director)
|
58,556
|
*
|
Common
|
George
E. Hartman (Director)
|
144,856(10)
|
*
|
Common
|
Robert
F. Hemphill, Jr. (Director)
|
934,255(11)
|
1.0%
|
Common
|
Pierre
Lortie (Director)
|
28,115
|
*
|
Common
|
Robert
G. van Schoonenberg (Director)
|
38,815
|
*
|
|
|
|
|
Common
|
All
Directors and Officers as a Group (13
persons)
|
22,505,169(12)
|
23.9%
|
Title
of
Class
|
Name
and Address of 5% Beneficial Owner
|
Amount
and
Nature
of
Beneficial
Ownership
|
Percentage
of
Class
|
Common
|
Al
Yousuf, LLC
|
20,105,038(13)
|
21.6%
|
*
Represents less than 1% of the outstanding Common Shares.
(1)
|
Includes
all Common Shares issuable pursuant to the exercise of options and
warrants that are exercisable within 60 days of March 31,
2009. Does not include any Common Shares subject to options
that are not exercisable within 60 days of March 31, 2009 or subject to
options that vest only upon the occurrence of events, such as a rise in
the market price of the Common Shares, outside of the control of the
optionee.
|
(2)
|
Based
on 93,153,271 Common Shares outstanding as of March 31,
2009. Common Shares underlying options, warrants or other
convertible or exercisable securities are, to the extent exercisable
within 60 days of March 31, 2009, deemed to be outstanding for purposes of
calculating the percentage ownership of the owner of such convertible and
exercisable securities, but not for purposes of calculating any other
person’s percentage ownership.
|
(3)
|
Includes
106,250 Common Shares subject to options granted to Mr. Copeland pursuant
to the 2005 Plan.
|
(4)
|
Includes
37,500 Common Shares subject to options granted to Mr. Fallini pursuant to
the 2005 Plan.
|
(5)
|
Includes
25,000 Common Shares subject to options granted to Mr. Sabacky pursuant to
the 1998 Plan and 165,824 Common Shares subject to options granted to Mr.
Sabacky pursuant to the 2005 Plan.
|
(6)
|
Includes
153,213 Common Shares subject to options granted to Mr. Balogh pursuant to
the 2005 Plan. Includes 23,000 Common Shares owned by Linda
Balogh, the spouse of Mr. Balogh.
|
(7)
|
Includes
178,767 Common Shares subject to options granted to Mr. Pedraza pursuant
to the 2005 Plan.
|
(8)
|
Includes
211,200 Common Shares subject to options granted to Mr. Dickinson pursuant
to the 1998 Plan and 198,812 Common Shares subject to options granted to
Mr. Dickinson pursuant to the 2005
Plan.
|
(9)
|
The
owner of record of 20,095,038 of such Common Shares is Al Yousuf LLC,
however, Mr. Al Yousuf has voting control and investment discretion over
these securities.
|
(10)
|
Includes
85,000 Common Shares subject to options granted to Mr. Hartman pursuant to
the 1998 Plan. Includes 500 Common Shares owned by Julie
Bredin, the spouse of Mr. Hartman.
|
(11)
|
The
owner of record of 895,523 of such Common Shares is The AES Corporation,
however, Mr. Hemphill has voting control and investment discretion over
these securities. Mr. Hemphill has no direct financial interest
in such securities and disclaims beneficial ownership of these
securities. Includes 2,666 Common Shares subject to options
granted to Mr. Hemphill pursuant to the 2005
Plan.
|
(12)
|
Includes
236,200 Common Shares subject to options granted to officers and directors
pursuant to the 1998 Plan and 928,032 Common Shares subject to options
granted to officers and directors pursuant to the 2005
Plan.
|
(13)
|
Eqbal
Al Yousuf has voting and investment control over these
securities. Information is based solely on Schedule 13D filed
by Al Yousuf LLC and Eqbal Al Yousuf with the Securities and Exchange
Commission on October 8, 2008.
|
Certain Relationships and
Related Transactions
Subsequent
to Mr. Hemphill’s appointment as a director in April 2007, the Corporation
entered into a multi-year Joint Development and Equipment Purchase Agreement
with AES Energy Storage, LLC (“AES”) in July 2007. Under the terms of
this agreement the Corporation has agreed to work jointly with AES to develop a
suite of energy storage products for purchase by AES and potentially to third
parties. This agreement is effective through July 2011. As
part of the joint development process, AES placed an order for a prototype
energy storage product during 2007 at a cost of $1,000,000. As
Executive Vice President of The AES Corporation, Mr. Hemphill was not
independent in regard to this transaction and confirmed that he executed the
Board of Directors' consent regarding this contract for the purpose of making
the consent effective as a written consent resolution but would be abstaining
were this matter considered at a meeting of the directors. Mr.
Hemphill disclaims any direct financial interest in such
transactions.
In
October 2008 the Corporation accepted a $10,000,000 investment from Al Yousuf,
LLC in exchange for 5,882,353 Common Shares pursuant to a stock purchase and
settlement agreement. In addition, the Corporation appointed Mr.
Eqbal Al Yousuf, who is the chief executive president of Al Yousuf, LLC, to a
seat on the Board, expanding the number of Directors from seven to
eight. As part of this stock purchase and settlement agreement with
Al Yousuf, LLC, the Corporation also provided Al Yousuf, LLC, with 2,117,647
Common Shares in exchange for a release of potential breach of contract and
other claims related to the Al Yousuf, LLC stock purchase in
2007. Under the 2007 purchase agreement, the Corporation made certain
representations and warranties related to its inventory, warranty reserve and
similar matters that were affected by the write-offs and warranty offers
announced in March 2008.
Compensation, Nominating and
Governance Committee
The
Compensation, Nominating and Governance Committee discharges the Board’s
responsibilities relating to compensation of the Corporation’s directors and
officers, oversees and monitors the Corporation’s management in the interest and
for the benefit of the stockholders and assists the Board by identifying and
recommending individuals qualified to become directors. The
Compensation, Nominating and Governance Committee has overall responsibility for
approving and evaluating the director and officer compensation plans, policies
and programs of the Corporation.
The
members of the Compensation, Nominating and Governance Committee as of the date
of this Information Circular are Pierre Lortie (Chair), Eqbal Al Yousuf, Michel
Bazinet, and Robert van Schoonenberg, each of whom is independent under NASDAQ’s
listing standards. On May 29, 2008, Mr. van Schoonenberg was
appointed to the Compensation, Nominating and Governance
Committee. On October 14, 2008, Mr. Al Yousuf was appointed to the
Compensation, Nominating and Governance Committee. The Compensation,
Nominating and Governance Committee met six times during 2008 in person or by
telephone.
The
charter governing operations of the Compensation, Nominating and Governance
Committee was adopted in April 2004 and updated in February 2007, and is
available at the Corporation’s website at www.altairnano.com under “Investors” -
“Governance.”
Compensation,
Nominating and Governance Committee Interlocks and Insider
Participation
The
current members of the Compensation, Nominating and Governance Committee are
Pierre Lortie (Chair), Eqbal Al Yousuf, Michel Bazinet, and Robert van
Schoonenberg. Subsequent to June 3, 2009, Michel Bazinet will
no longer be a Director or member of the Compensation, Nominating and Governance
Committee. On May 29, 2008, Mr. van Schoonenberg was appointed to the
Compensation, Nominating and Governance Committee. Prior to May 29,
2008, the members of the Compensation, Nominating and Governance Committee were
Pierre Lortie (Chair), and Michel Bazinet. On October 14, 2008, Mr.
Eqbal Al Yousuf was appointed to the Compensation, Nominating and Governance
Committee. None of Messrs. Lortie, Al Yousuf, Bazinet or van
Schoonenberg, is currently, or has formerly been, an officer or employee of the
Corporation or any of its subsidiaries. The Corporation had no
relationship during 2008 requiring disclosure under Item 404 of Regulation S-K
with respect to any of the persons who served on the Compensation, Nominating
and Governance Committee during 2008 other than Eqbal Al
Yousuf. As described in “Certain Relationships and Related
Transactions,” in October 2008, pursuant to a stock purchase and settlement
agreement, the Corporation accepted a $10,000,000 investment from Al Yousuf, LLC
in exchange for 5,882,353 Common Shares, agreed to appoint Mr. Al Yousuf to its
Compensation, Nominating and Governance Committee and issue Al Yousuf, LLC with
2,117,647 Common Shares in exchange for a release of potential breach of
contract and other claims related to the Al Yousuf, LLC stock purchase in
2007. Mr. Al Yousuf is the chief executive officer of Al Yousuf,
LLC. The Board of Directors believes that Mr. Al Yousuf is
independent despite his previous financing activities and significant
shareholdings based upon the independence from management he has exhibited at
all times since his initial investment in the Corporation and its general belief
that being a significant shareholder is not likely to interfere with the
independence of a director’s judgment (and is likely to enhance
it).
Compensation
Discussion and Analysis
Pursuant
to Item 402(b) of Regulation S-K promulgated under the United States Securities
Act of 1933, as amended (the “Securities Act”), the following discussion is
meant to provide an overview of the material elements of the Corporation’s
compensation policy (the “Compensation Policy”). The following
discussion is meant to be a principle-based discussion of the Corporation’s
compensation policies and provide context to the tables that
follow. Specific reference to disclosures in the compensation tables
will be discussed in narrative descriptions following the respective
compensation tables.
Compensation
Philosophy
The
objectives of our executive officer compensation policy are to attract and
retain talented and dedicated executives, to tie compensation to the achievement
of specified short-term and long-term performance objectives, and to align
executives’ incentives with the creation of shareholder value. The Compensation,
Nominating and Governance Committee approves and annually evaluates the
Corporation’s compensation policies applicable to, and the performance of, the
Corporation’s executive officers, including the Chief Executive Officer, Chief
Financial Officer and the other executive officers identified in the Summary
Compensation Table on page 22 (referred to as the “named executive
officers”).
The
following objectives guide compensation decisions:
|
-
|
Provide
a competitive total compensation package that enables the Corporation to
attract and retain key executive
talent;
|
|
-
|
Align
key elements of compensation with the Corporation’s annual and long-term
business strategies and objectives;
and
|
|
-
|
Provide
a mix of base compensation and performance-based compensation that
directly links executive rewards to the performance of the Corporation and
shareholder return.
|
Elements
of Executive Compensation
The
principal components of compensation for the Corporation’s named executive
officers are as follows:
|
-
|
Annual
incentive bonus; and
|
|
-
|
Long-term
equity-based incentives, primarily stock
options.
|
Named
executive officers are entitled to benefits generally available to all full-time
salaried employees of the Corporation. These benefits include up to 5
weeks per-year of paid time off for medical and vacation leave, subsidized group
health plan coverage offered to all salaried employees of the Corporation, and
eligibility to participate in the Corporation’s 401(k) Profit Sharing Plan (the
“401(k) Plan”), matching contributions under the 401(k) Plan in an amount up to
the greater of 50% of the first $2,500 contributed or 3% of the employee’s base
salary. As explained in “Termination and Change of Control
Agreements” below, certain named executive officers may be entitled to severance
payments in connection with a change of control or termination of their
employment. Other than as described above, the named executive
officers are not provided with special benefits or perquisites such as company
cars, enhanced medical plans or dental plans.
Determination
of Compensation
In order
to evaluate the competitiveness and appropriateness of the Corporation’s total
compensation and mix of compensation for executive officers, the Compensation,
Nominating and Governance Committee reviews data on the base salary, annual
incentive bonus and equity-based incentive compensation for various executive
positions, as well as the mix of compensation components, of executive officers
of a benchmark group of twelve companies that comprise the chemicals,
electronics and industrial products business sectors of reporting public
companies with annual revenues of less than $100 million and with a market
capitalization between $200 million and $750 million. Equilar, an
independent company, produces all compensation reports.
In
addition to the benchmark company information, in determining the amount of and
mix of compensation, the Compensation, Nominating and Governance Committee
considers evaluations of the Chief Executive Officer by each of the directors of
the Corporation, the recommendations of the Chief Executive Officer and Vice
President of Human Resources with respect to officers other than the Chief
Executive Officer, the performance of each executive officer against
pre-determined business goals and objectives and the potential role of each
executive in the strategic plan of the Corporation. Subject to adjustment upward
or downward based upon the various evaluations, the Compensation, Nominating and
Governance Committee generally targets base compensation and equity-based
incentive awards near the median of the benchmark group and targets maximum
annual incentive bonus near the 75th
percentile of the benchmark group detailed below:
SurModics,
Inc.
|
Valence
Technology, Inc.
|
FuelCell
Energy
|
DTS,
Inc.
|
Peerless
Manufacturing Company
|
Metabolix,
Inc.
|
Raser
Technologies, Inc.
|
Graham
Corporation
|
Cambridge
Display Technology
|
Fuel
Tech, Inc.
|
Capstone
Turbine Corporation
|
Ballard
Power Systems
|
Mix
of Compensation
The
Compensation, Nominating and Governance Committee believes that a significant
percentage of the annual compensation of the named executive officers should be
at-risk. During 2008, between approximately 39% and 52% of the named executive
officers’ potential annual compensation was dependent upon the achievement of
individual and corporate goals. In addition, stock options granted to
the Corporation’s named executive officers for retention and incentive purposes
generally vest over a period of four years.
The
percentage of compensation at risk increases as the level of position increases,
with the top figures in each of the ranges set forth above being that of the
Corporation’s Chief Executive Officer. This provides additional upside potential
and downside risk for senior positions, recognizing that these roles have
greater influence on the Corporation’s performance.
Base
Salary
Base
salaries for the named executive officers are established based on the scope of
their responsibilities, their skills and their historical and potential
contributions to the Corporation, as well as the compensation paid by
benchmarked companies for similar positions. Generally, base salaries are
targeted near the median of the range of salaries for executives in similar
positions with similar responsibilities at benchmark companies, in line with our
compensation philosophy. Base salaries are reviewed annually, and adjusted from
time to time to realign salaries with market levels after taking into account
individual responsibilities, performance and experience.
The base
salaries of the named executive officers as of the date of this Information
Circular are as follows:
Name
|
2009
Base Salary ($)
|
Terry
M. Copeland, President, Chief Executive Officer
|
325,000
|
John
C. Fallini, Chief Financial Officer
|
230,000
|
Bruce
J. Sabacky, Vice President & Chief Technology Officer
|
225,000
|
Stephen
Balogh, Vice President Human Resources
|
193,800
|
C.
Robert Pedraza, Vice President Corporate Strategy
|
190,000
|
Annual Incentive
Bonus
The
annual incentive bonus is intended to compensate executives for achieving
corporate goals. One hundred percent of each named executive
officer’s annual incentive bonus is contingent upon the Corporation achieving
pre-determined financial and operational goals.
Decisions
with respect to annual incentive bonus are made after the end of each fiscal
year. At the beginning of each year, the Compensation, Nominating and
Governance Committee sets annual performance goals, a target and maximum
incentive bonus amount, and a formula for determining the amount, if any, of the
bonus each executive officer is entitled to receive. Annual incentive
bonuses are paid 60% in cash and 40% in Common Shares granted. For
purposes of determining the number of Common Shares an employee is issued as
part of a stock bonus, the Corporation uses the weighted average market value of
the Corporation’s Common Shares for the applicable fiscal year. The
Compensation, Nominating and Governance Committee reserves the right to award
annual incentive bonuses above or below target amounts as it deems
appropriate.
Targets
and Results for 2008. During
2008, each named executive officer was eligible for target annual incentive
bonuses ranging from 60% to 80% of his base salary, depending on his
position. Of these amounts, 100% was tied to the achievement of
corporate goals as follows: a total revenue goal (25% weighting), a cash balance
at December 31, 2008 target (45% weighting), an order backlog (25% weighting)
and a safety OSHA incidence rate (5% weighting), all in line with the
Corporation’s board-approved budget. The Compensation, Nominating and
Governance Committee reserves the discretion to award, or to deny, annual
incentive bonuses whether or not performance targets are achieved, as it deems
appropriate. Decisions with respect to incentive bonuses for 2008
were made at a meeting of the Compensation, Nominating and Governance Committee
based upon year-end information on February 26, 2009. Pursuant to the
formula included in the 2008 incentive plan, the Compensation, Nominating and
Governance Committee determined that no named executive officer was entitled to
a bonus for 2008.
Targets
for 2009 Results. For 2009, each named executive officer is
eligible for target annual incentive bonuses ranging from 60% to 80% of his base
salary, depending on his position. Of these amounts, 100% is tied to
the achievement of corporate goals as follows: a total revenue goal (25%
weighting), a cash balance at December 31, 2009 target (40% weighting), an order
backlog (30% weighting) and a safety OSHA incidence rate (5% weighting), all in
line with the Corporation’s board-approved budget. The incentive
bonus is triggered when 100% of the corporate goals are achieved and increases
linearly from 100% to 150% for 100% to 125% performance. The
Compensation, Nominating and Governance Committee reserves the discretion to
award, or to deny, annual incentive bonuses whether or not performance targets
are achieved, as it deems appropriate. Decisions with respect to
incentive bonuses for 2009 will be made by the Compensation, Nominating and
Governance Committee based upon year-end information and pursuant to the formula
included in the 2009 incentive plan.
Name
|
Minimum/Target
Incentive
Bonus
Opportunity (payout
as
a % of base salary)
|
Maximum
Incentive Bonus
Opportunity
(payout as a %
of
base salary)
|
Terry
M. Copeland, President, Chief Executive Officer
|
80
|
120
|
John
C. Fallini, Chief Financial Officer
|
60
|
90
|
Bruce
J. Sabacky, Vice President & Chief Technology Officer
|
60
|
90
|
Stephen
Balogh, Vice President Human Resources
|
60
|
90
|
C.
Robert Pedraza, Vice President Corporate Strategy
|
60
|
90
|
Bonuses
are paid 60% in cash and 40% in stock for each named executive
officer. The Company’s Board of Directors retains discretion to award
bonuses above, and below, the bonus amount dictated by the Plan.
Long-Term Equity-Based
Incentives
The
Corporation’s 2005 Stock Incentive Plan (Amended and Restated) (the “2005 Plan”)
was adopted at the Corporation’s Annual Meeting of Shareholders in May 2005 and
amended and restated in 2007 to increase the number of eligible shares. Under
the 2005 Stock Plan, the Corporation is authorized to issue equity-based awards,
including stock options, stock bonuses, restricted stock, stock appreciation
rights, and performance-based awards, with respect to up to 9,000,000 Common
Shares. Each of the Compensation, Nominating and Governance Committee
and the Board of Directors have joint authority to grant awards under the 2005
Stock Plan.
The
Corporation had previously authorized its 1996 Stock Option Plan and 1998 Stock
Option Plan, under which an aggregate of 445,900
awards continue to be outstanding as of March 31, 2009; however, awards can no
longer be granted under such plans.
The
Corporation’s long-term equity-based incentive program is focused on rewarding
performance that enhances shareholder value. The program involves the periodic
grant of options to purchase Common Shares in order to provide executive
officers with the opportunity to purchase an equity interest in the Corporation
and to share in the appreciation of the value of the Corporation’s Common
Shares.
The
Compensation, Nominating and Governance Committee periodically considers whether
or not to grant additional stock options in order to maintain the overall
competitiveness of the Corporation’s compensation package for each named
executive officer and to ensure that executives, particularly executives whose
other stock options have vested and/or been exercised, have an incentive to
remain with the Corporation long term and to increase shareholder
value. Factors weighed in determining whether to make, and the amount
of, these grants include the above-described review of benchmark compensation
data and assessment of past performance, retention considerations, information
regarding each named executive officer’s existing equity and stock option
ownership, potential shareholder dilution and the expense to the Corporation
pursuant to Standard of Financial Accounting Standards No. 123(R), Share-Based
Payment (“FAS No. 123(R)”). Such options generally have an exercise price equal
to the market price on the date of grant or the market price on the date of
grant plus a premium over that price, a 10-year term and vest over a four-year
term.
In
addition, from time to time stock option grants are made to newly hired
employees based on their level of responsibility and competitive
practices.
Retention
Grants.
Following his appointment as interim President, Terry Copeland was
awarded a grant of options to purchase 50,000 Common Shares at an exercise price
of $2.18 per share on April 15, 2008. Following his appointment as
President and Chief Executive Officer, he was awarded an additional grant of
options to purchase 75,000 Common Shares at an exercise price of $1.80 per share
on July 15, 2008. In addition to the options awarded due to his
increased responsibilities, Terry Copeland was awarded a retention grant of
options to purchase 275,000 Common Shares at an exercise price of $1.22 (10
percent above the current fair market value at grant date) on January 15,
2009. All options have a 10-year term and vest 25% per year on the
anniversary date of the respective grant. This retention grant was
determined to be in line with median grants to CEO’s in benchmarked
companies.
The other
named executive officers who are still employed by the Corporation were granted
retention options to purchase an aggregate of 500,000 Common Shares at an
exercise price of $1.22 per share on January 15, 2009 (10 percent above current
fair market value at grant date). The options have a 10-year term and
vest 25% annually over a four-year period.
Compensation
Adjustments
The
Corporation may increase or, subject to contractual or other restrictions
decrease an executive’s overall compensation at any time during any fiscal year
after considering several factors, including level and scope of
responsibilities, contribution to overall corporate performance and achievement
of personal goals and objectives.
The
Corporation does not currently have a defined policy regarding the subsequent
adjustment or recovery of compensation or incentive awards if there is a
subsequent accounting restatement or other correction of data that adversely
affects relevant benchmarks or targets. However, a policy regarding
these matters is being considered as part of the Corporation’s 2009 incentive
plan.
Termination
and Change-of-Control Agreements
The
employment agreements of the following named executive officers provide for
termination and change of control benefits as follows:
The
employment of Dr. Jeffrey McKinney, our Vice President and Chief Patent Counsel,
was terminated on September 6, 2008. Under the terms of Dr.
McKinney’s employment agreement in connection with a termination of his
employment by the Corporation without cause, he was entitled to receive a
severance benefit equal to his base salary for one year, health benefits for
eighteen months and his pro rata bonus for 2008 paid in the first quarter of
2009.
The
employment of Alan Gotcher, former Chief Executive Officer and President of the
Corporation, was terminated on February 27, 2008. Under the terms of
Dr. Gotcher’s employment agreement, in connection with a termination of his
employment by the Corporation without cause, Dr. Gotcher was entitled to receive
severance that includes his termination-date base salary and medical benefits
for one year. Dr. Gotcher was also entitled to receive a portion of
his projected bonus for 2008 as severance. In order to resolve an
ambiguity in the employment agreement concerning the bonus portion of Dr.
Gotcher’s severance package, he and the Corporation agreed in his separation
agreement to a $240,000 cash payment in lieu of such potential bonus
payment.
During
2008 each of the following named executive officers signed employment
agreements: Dr. Terry Copeland, President and Chief Executive Officer; John
Fallini, Vice President and Chief Financial Officer; Stephen Balogh, Vice
President, Human Resources; C. Robert Pedraza, Vice President, Corporate
Strategy; and Dan Voelker, Vice President, Engineering and
Operations. All of the agreements include the following
provisions:
If the
officer’s employment is terminated by the officer for good reason, which
includes, among other things, (a) the Corporation requiring the officer to
relocate his place of employment without the officer’s consent, or (b) a
material adverse change in the officer’s title, position, and/or duties 90 days
before or within one year after a change of control, the officer is entitled to
a severance benefit equal to his base salary and health benefits for one
year. This one-year base salary severance benefit will be extended to
16 months if either the officer was required to relocate more than 50 miles in
order to commence employment and the termination occurs within two years of
commencement of employment, or the officer later consents to a relocation of his
employment and the termination occurs within two years of such voluntary
relocation.
If the
officer’s employment is terminated by the Corporation without cause, the officer
is entitled to a severance benefit equal to his base salary for one year, health
benefits for 18 months, and a lump sum bonus payment equal to 60% of his base
salary paid for the year in which his termination occurred. The
one-year base salary severance benefit will be extended to 16 months if either
the officer was required to relocate more than 50 miles in order to commence
employment and the termination occurs within two years of commencement of
employment, or the officer later consents to a relocation of his employment and
the termination occurs within two-years of such voluntary
relocation.
The
officer is not entitled to any severance if his employment is terminated at any
time by the Corporation with cause or by the officer without good
reason. Dr. Copeland’s current base salary is $325,000 per year; Mr.
Fallini’s current base salary is $230,000 per year; Mr. Balogh’s current base
salary is $193,800 per year; and Mr. Pedraza’s current base salary is $190,000
per year.
The
employment agreement signed previously by Dr. Bruce Sabacky, Vice President and
Chief Technology Officer, remains in effect and contain the above
provisions. Dr. Sabacky’s current base salary is $225,000 per
year.
The
Compensation, Nominating and Governance Committee believes that providing a
reasonable severance arrangement tied to termination without cause is essential
to attracting and retaining talented executive officers. In addition,
the Compensation, Nominating and Governance Committee believes that the
severance arrangements provided to certain of its named executive officers serve
the best interests of the Corporation and its shareholders by ensuring that, if
a hostile or friendly change of control is under consideration, its executives
will feel secure enough about their post-transaction financial future that they
will advise the Board of Directors about the potential transaction without
consideration, or with lessened consideration, of any adverse effect of the
transaction on their future employment and compensation. The
Corporation has no other severance agreements in place with its named executive
officers.
Role
of Executive Officers in Determining Executive Pay
The
Compensation, Nominating and Governance Committee makes all decisions with
respect to base compensation, annual incentive compensation and the award of
stock options to the executive officers of the Corporation, including all named
executive officers. Such authority may not be delegated to another
person other than, as appropriate, the entire Board of Directors.
At the
end of each fiscal year, the Corporation’s Vice President of Human Resources and
Chief Executive Officer are responsible for evaluating the performance of each
named executive officer (and other officers) against corporate and individual
performance objectives and for submitting a report to the Compensation,
Nominating and Governance Committee detailing the results of their
evaluations. In connection with this report, each of the Vice
President of Human Resources and Chief Executive Officer make recommendations to
the Compensation, Nominating and Governance Committee with respect to
compensation matters related to the prior year, including employee-specific
recommendations but not with respect to himself. In addition, each of
the two officers makes recommendations to the Compensation, Nominating and
Governance Committee with respect to compensation matters related to the
upcoming year, including employee-specific recommendations (but not with respect
to himself) and strategic and design recommendations. The
Compensation, Nominating and Governance Committee considers these
recommendations, and the report of these officers, among other factors by the
Compensation, Nominating and Governance Committee as it makes prior-year and
coming-year compensation decisions.
Tax
and Accounting Considerations
Accounting
Treatment
The
Corporation adopted Standard of Financial Accounting Standards No. 123(R),
Share-Based Payment, which requires companies to expense the costs of
stock-based compensation in their financial statements. As such, the
Corporation began recording stock-based compensation expense in the income
statement in 2006. The fair value of each award is estimated on the date
of grant, using the Black-Scholes option-pricing model. Once the fair
value of each award is determined, it is expensed in the income statement over
the vesting period.
Deductibility
of Executive Compensation
Section 162(m)
of the United States Internal Revenue Code of 1986, as amended (the “Code”),
imposes a $1 million annual limit on the amount that a public company may deduct
for compensation paid during a tax year to the company’s Chief Executive Officer
or to any of the company’s four other most highly compensated executive officers
who are still employed at the end of the tax year. The limit does not
apply to compensation that meets the requirements of Code Section 162(m) for
“qualified performance-based” compensation (i.e., compensation paid only if the
executive meets pre-established, objective goals based upon performance criteria
approved by the company’s shareholders).
The
Compensation, Nominating and Governance Committee reviews and considers the
deductibility of executive compensation under Section 162(m) of the
Code. In certain situations, the Compensation, Nominating and
Governance Committee may approve compensation that will not meet the
requirements of Code Section 162(m) in order to ensure competitive levels of
total compensation for its executive officers. Stock option grants in 2008 and
2009 were intended to constitute “qualified performance-based compensation”
under Section 162(m); however, the Corporation’s 2008 annual performance bonus
would not have been, and the Corporation’s 2009 annual performance bonus will
not be, “qualified performance-based compensation.” In 2008, none of the named
executive officers, received base pay, annual bonus and other compensation in an
amount in excess of the $1 million deduction limit.
Compensation,
Nominating and Governance Committee Report
The
Compensation, Nominating and Governance Committee has reviewed and discussed the
Compensation Discussion & Analysis section included in this Information
Circular with management. Each member of the Compensation, Nominating
and Governance Committee is entitled to rely on (i) the integrity of those
persons within the Corporation and of the professionals and experts from which
the Compensation, Nominating and Governance Committee receives information, and
(ii) the accuracy of the financial and other information provided to the
Compensation, Nominating and Governance Committee by such persons, professionals
or experts absent actual knowledge to the contrary.
Based
upon that review and related discussions, the Compensation, Nominating and
Governance Committee recommends to the Corporation’s Board of Directors that the
Compensation Discussion & Analysis contained herein be included in this
Information Circular and Proxy Statement.
COMPENSATION,
NOMINATING AND GOVERNANCE COMMITTEE
Pierre
Lortie, Chair
Eqbal Al
Yousuf
Michel
Bazinet
Robert
van Schoonenberg
April 16,
2009
Executive
Compensation
(a) Summary
Compensation Table
The
following table provides details with respect to the total compensation of the
Corporation’s named executive officers during the years ended December 31, 2008,
2007 and 2006:
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards (1)
($)
|
Non-
Equity
Incentive
Plan
Compen-
sation
(2)
($)
|
Change
in
Pension
Value
and
Nonqualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compen-
sation
(3)
($)
|
Total
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
Terry
Copeland, President,
Chief
Executive Officer
and
Director
|
2008
|
322,302
|
Nil
|
Nil
|
271,294
|
Nil
|
Nil
|
6,750
|
600,346
|
2007
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
2006
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
Alan
J. Gotcher, Former President, Former Chief Executive Officer and
Director
|
2008
|
160,629
|
Nil
|
Nil
|
593,820
|
Nil
|
Nil
|
536,731(4)
|
1,291,180
|
2007
|
370,382
|
459,453(5)
|
141,926
|
550,066
|
174,939
|
Nil
|
10,250
|
1,707,016
|
2006
|
360,000
|
110,892(6)
|
Nil
|
237,740
|
86,400
|
Nil
|
7,500
|
802,531
|
John
C. Fallini, Chief
Financial
Officer
|
2008
|
167,197
|
Nil
|
Nil
|
168,558
|
Nil
|
Nil
|
3,715
|
339,470
|
2007
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
2006
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
Edward
H. Dickinson, Former Chief Financial Officer
|
2008
|
151,918
|
Nil
|
Nil
|
123,505
|
Nil
|
Nil
|
5,700
|
281,123
|
2007
|
188,462
|
Nil
|
40,953
|
176,897
|
50,479
|
Nil
|
5,700
|
462,491
|
2006
|
150,000
|
Nil
|
Nil
|
112,879
|
27,000
|
Nil
|
4,500
|
294,379
|
Bruce
J. Sabacky, Vice
President
& Chief
Technology
Officer
|
2008
|
225,001
|
Nil
|
Nil
|
144,733
|
Nil
|
Nil
|
6,750
|
376,484
|
2007
|
190,847
|
12,245(7)
|
54,847
|
153,837
|
67,606
|
Nil
|
5,700
|
485,082
|
2006
|
150,000
|
Nil
|
Nil
|
73,084
|
27,000
|
Nil
|
4,500
|
254,584
|
Stephen
Balogh,
Vice
President
Human
Resources
|
2008
|
192,868
|
Nil
|
Nil
|
95,423
|
Nil
|
Nil
|
5,814
|
294,105
|
2007
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
2006
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
C.
Robert Pedraza,
Vice
President
Corporate
Strategy
|
2008
|
175,453
|
Nil
|
Nil
|
85,258
|
Nil
|
Nil
|
Nil
|
260,711
|
2007
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
2006
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
Jeffrey
A. McKinney,
Former
Vice President and
Chief
Patent Counsel
|
2008
|
160,761
|
Nil
|
Nil
|
151,078
|
Nil
|
Nil
|
149,680(8)
|
461,519
|
2007
|
150,653
|
Nil
|
49,262
|
93,609
|
60,721
|
Nil
|
Nil
|
354,245
|
2006
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
|
*
Compensation information not reported because such person was not a named
executive officer during this calendar year.
|
(1)
|
The
amounts in column (f) reflect the dollar amount recognized for financial
statement reporting purposes for the respective fiscal year, in accordance
with FAS 123 (R) of awards pursuant to the Stock Incentive Plans and thus
may include amounts from awards granted in prior
years. Assumptions used in the calculation of these amounts are
included in Note 11 to the Corporation’s audited financial statements for
the year ended December 31, 2008 included in the Corporation’s Annual
Report on Form 10-K filed with the Securities and Exchange Commission on
March 16, 2009 and in Note 11 to the Corporation’s audited financial
statements for the year ended December 31, 2007 included in the
Corporation’s Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 14,
2008.
|
|
(2)
|
Represents
cash portion of annual incentive bonus earned with respect to indicated
fiscal year. Bonuses are generally paid in the subsequent
fiscal year.
|
|
(3)
|
Reflects
value of matching contributions made by the Corporation in connection with
the 401(k) Plan, except as noted.
|
|
(4)
|
Represents
$534,231 pursuant to the Separation Agreement and Release of All Claims
dated April 18, 2008 with Dr. Gotcher and $2,500 of matching contributions
made by the Corporation in connection with the 401(k)
Plan.
|
|
(5)
|
Represents
discretionary portion of the 2007 bonus awarded to Dr. Gotcher in the form
of cash of $253,661 and 44,737 Common Shares with a value of $205,792 over
and above the 98.4% bonus payout level as calculated in accordance with
the annual incentive bonus plan as determined by the Compensation,
Nominating and Governance
Committee.
|
|
(6)
|
Represents
discretionary portion of the 2006 bonus awarded to Dr. Gotcher in the form
of an additional option grant over and above the 40% as calculated in
accordance with the annual incentive bonus plan as determined by the
Compensation, Nominating and Governance
Committee.
|
|
(7)
|
Represents
discretionary portion of the 2007 bonus awarded to Dr. Sabacky in the form
of cash of $6,760 and 1,192 Common Shares with a value of $5,485 over and
above the 98.4% bonus payout level as calculated in accordance with the
annual incentive bonus plan as determined by the Compensation, Nominating
and Governance Committee.
|
|
(8)
|
Represents
$149,680 pursuant to the Separation Agreement and Release of All Claims
dated September 5, 2008 with Dr.
McKinney.
|
(b)
Grant of Plan-Based Awards
Table
The
following table provides details with respect to plan-based awards, if any,
granted to the named executive officers during the year ended December 31,
2008:
Name
|
Grant
Date
|
Estimated
Future Payouts
Under
Non-Equity Incentive
Plan
Awards (1)
|
Estimated
Future Payouts Under Equity Incentive Plan Awards(1)
|
All
Other
Stock
Awards:
Number
of
Shares
of
Stock
or
Units
(#)
|
All
Other
Option
Awards:
Number
of
Securities
Under-
Lying
Options
(#)
|
Exercise
or
Base
Price
of
Option
Awards
($/Sh)
|
Grant
Date Fair Value of Stock and Option Awards
($)
|
|
|
|
|
(i)
|
(j)
|
(k)
|
(l)
|
Target
($)
|
Maxi-
mum
($)
|
Target
(#)
|
Maxi-
mum
(#)
|
|
|
|
|
(a)
|
(b)
|
(c)
|
(e)
|
(g)
|
(h)
|
|
|
|
|
Terry
Copeland, President, Chief Executive Officer and Director
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
1,887
|
Nil
|
Nil
|
Nil
|
1/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
75,000(2)
|
3.72
|
144,734
|
|
117,000
|
175,500
|
22,741
|
34,111
|
Nil
|
Nil
|
Nil
|
Nil
|
4/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
50,000
|
2.18
|
56,186
|
7/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
75,000
|
1.80
|
70,376
|
Alan
J. Gotcher, Former President, Chief Executive Officer and
Director
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
75,591
|
Nil
|
Nil
|
Nil
|
1/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
283,000(2)
|
3.72
|
593,820
|
|
204,000
|
306,000
|
39,650
|
59,475
|
Nil
|
Nil
|
Nil
|
Nil
|
John
C. Fallini, Chief Financial Officer
|
4/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
150,000
|
2.18
|
168,558
|
|
60,796
|
91,193
|
11,816
|
17,725
|
Nil
|
Nil
|
Nil
|
Nil
|
Edward
H. Dickinson, Former Chief Financial Officer
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
8,903
|
Nil
|
Nil
|
Nil
|
1/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
64,000(2)
|
3.72
|
123,505
|
|
32,400
|
48,600
|
6,297
|
9,446
|
Nil
|
Nil
|
Nil
|
Nil
|
Bruce
J. Sabacky, Chief Technology Officer
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
13,116
|
Nil
|
Nil
|
Nil
|
1/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
75,000(2)
|
3.72
|
144,733
|
|
81,000
|
121,500
|
15,743
|
23,615
|
Nil
|
Nil
|
Nil
|
Nil
|
Stephen
Balogh, Vice President Human Resources
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
9,371
|
Nil
|
Nil
|
Nil
|
1/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
65,000(2)
|
3.72
|
95,423
|
|
69,768
|
104,652
|
13,560
|
20,341
|
Nil
|
Nil
|
Nil
|
Nil
|
C.
Robert Pedraza, Vice President Corporate Strategy
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
9,446
|
Nil
|
Nil
|
Nil
|
1/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
35,000(2)
|
3.72
|
51,382
|
|
68,400
|
102,600
|
13,294
|
19,942
|
Nil
|
Nil
|
Nil
|
Nil
|
4/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
40,000
|
2.18
|
33,876
|
Jeffrey
A. McKinney, Former Vice President and Chief Patent
Counsel
|
1/3/08
|
Nil
|
Nil
|
Nil
|
Nil
|
10,709
|
Nil
|
Nil
|
Nil
|
4/15/08
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
72,000(2)
|
3.72
|
151,078
|
|
77,400
|
116,100
|
15,044
|
22,566
|
Nil
|
Nil
|
Nil
|
Nil
|
|
(1)
|
Amounts
reflect bonus amounts calculated based on the 2008 annual incentive bonus
plan as approved by the Compensation, Nominating and Governance Committee
on June 23, 2008. The target is based on achieving 100% of the
Corporation performance goal, and the maximum is based on achieving 125%
of the Corporation performance goal, which also is the bonus
cap. The named executive officers were not entitled to receive
a bonus at a threshold below the
target.
|
|
(2)
|
These
options were issued in connection with the 2008 retention
grant. As such, the vesting terms were set at 33% to vest
immediately, 33% to vest in 2009 and 34% to vest in 2010. The
same vesting terms applied to all retention grants issued in 2007 to other
employees of the Corporation.
|
(c) Outstanding Equity Awards at Fiscal
Year-End Table
The
following table provides information regarding equity awards held by the named
executive officers as of December 31, 2008:
|
Option
Awards
|
Name
|
Number
of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
Number
of
Securities
Underlying
Unexercised
Options
(#)
Un-
Exercisable
|
Equity
Incentive
Plan
Awards:
Number
of
Securities
Underlying
Unexercised
Unearned
Options
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
Terry
Copeland, President, Chief Executive Officer and Director
|
75,000(1)
|
75,000(1)
|
Nil
|
4.14
|
11/15/2017
|
Nil
|
75,000(2)
|
Nil
|
3.72
|
1/15/2018
|
Nil
|
50,000(3)
|
Nil
|
2.18
|
4/15/2018
|
Nil
|
75,000(4)
|
Nil
|
1.80
|
7/15/2018
|
Alan
J. Gotcher, Former President, Chief Executive Officer and
Director
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
John
C. Fallini, Chief Financial Officer
|
Nil
|
150,000(3)
|
Nil
|
2.18
|
4/15/2018
|
Edward
H. Dickinson, Former Chief Financial Officer
|
29,700(5)
|
Nil
|
Nil
|
6.13
|
4/13/2009
|
45,000(5)
|
Nil
|
Nil
|
1.20
|
2/9/2011
|
26,500(6)
|
Nil
|
Nil
|
4.07
|
3/10/2015
|
22,242(7)
|
Nil
|
Nil
|
3.42
|
3/10/2016
|
56,250(8)
|
18,750(8)
|
Nil
|
3.42
|
3/10/2016
|
10,570(9)
|
Nil
|
Nil
|
2.63
|
1/15/2017
|
50,000(10)
|
25,000(10)
|
Nil
|
2.63
|
1/15/2017
|
Nil
|
64,000(2)
|
Nil
|
3.72
|
1/15/2018
|
Bruce
J. Sabacky, Vice President & Chief Technology Officer
|
25,000(4)
|
Nil
|
Nil
|
4.07
|
3/25/2015
|
21,504(7)
|
Nil
|
Nil
|
3.42
|
3/10/2016
|
30,000(8)
|
10,000(8)
|
Nil
|
3.42
|
3/10/2016
|
10,570(9)
|
Nil
|
Nil
|
2.63
|
1/15/2017
|
50,000(10)
|
25,000(10)
|
Nil
|
2.63
|
1/15/2017
|
Nil
|
75,000(2)
|
Nil
|
3.72
|
1/15/2018
|
Stephen
Balogh, Vice President Human Resources
|
15,000(8)
|
5,000(8)
|
Nil
|
3.42
|
3/10/2016
|
37,500(11)
|
12,500(11)
|
Nil
|
2.96
|
7/26/2016
|
4,463(9)
|
Nil
|
Nil
|
2.63
|
1/15/2017
|
50,000(10)
|
25,000(10)
|
Nil
|
2.63
|
1/15/2017
|
Nil
|
65,000(2)
|
Nil
|
3.72
|
1/15/2018
|
C.
Robert Pedraza, Vice President Corporate Strategy
|
70,000(12)
|
Nil
|
Nil
|
2.96
|
8/19/2015
|
22,500(8)
|
7,500(8)
|
Nil
|
3.42
|
3/10/2016
|
4,850(7)
|
Nil
|
Nil
|
3.42
|
3/10/2016
|
33,333(10)
|
16,667(10)
|
Nil
|
2.63
|
1/15/2017
|
5,167(9)
|
Nil
|
Nil
|
2.63
|
1/15/2017
|
Nil
|
35,000(2)
|
Nil
|
3.72
|
1/15/2018
|
Nil
|
40,000(3)
|
Nil
|
2.18
|
4/15/2018
|
Jeffrey
A. McKinney, Vice President and Chief Patent Counsel
|
Nil
|
Nil
|
Nil
|
Nil
|
Nil
|
|
(1)
|
Options
vest over three years from date of grant: 25% vested
immediately; 25% vest on November 15, 2008; 25% vest on November 15, 2009;
and 25% vest on November 15, 2010.
|
|
(2)
|
Options
vest over four years from date of grant: 25% vested on January
15, 2009; 25% vest on January 15, 2010; 25% vest on January 15, 2011; and
25% vest on January 15, 2012.
|
|
(3)
|
Options
vest over four years from date of grant: 25% vest on April 15,
2009; 25% vest on April 15, 2010; 25% vest on April 15, 2011; and 25% vest
on April 15, 2012.
|
|
(4)
|
Options
vest over three years from date of grant: 25% vested
immediately; 25% vested on July 26, 2007; 25% vested on July 26, 2008; and
25% vest on July 26, 2009.
|
|
(5)
|
Options
were modified to fully vest on November 23,
2004.
|
|
(6)
|
Options
vest over one year from date of grant: 6,500 vested immediately
and 20,000 vested on March 10,
2006.
|
|
(7)
|
Options
vested immediately on the grant date of March 10,
2006.
|
|
(8)
|
Options
vest over three years from date of grant: 25% vested
immediately; 25% vested on March 10, 2007; 25% vested on March 10, 2008;
and 25% vested on March 10, 2009.
|
|
(9)
|
Options
vested immediately on the grant date of January 15,
2007.
|
|
(10)
|
Options
vest over two years from date of grant: 33% vested immediately;
33% vested on January 15, 2008; and 34% vested on January 15,
2009.
|
|
(11)
|
Options
vest over four years from date of grant: 25% vest on July 15,
2009; 25% vest on July 15, 2010; 25% vest on July 15, 2011; and 25% vest
on July 15, 2012.
|
|
(12)
|
Options
vest over two years from date of grant: 33% vested immediately;
33% vested on July 25, 2007; and 34% vested on July 25,
2008.
|
(d) Option Exercises and Stock
Vested
The
following table provides information regarding stock options exercised by, and
stock awards that vested in favor of, the named executive officers during the
fiscal year ended December 31, 2008.
Name
|
Option
Awards
|
Stock
Awards
|
|
Number
of Shares
Acquired
on
Exercise
(#)
|
Value
Realized on
Exercises
($)
|
Number
of Shares
Acquired
on
Vesting
(#)
|
Value
Realized
on
Vesting
($)
|
Edward
H. Dickinson, Former Chief Financial Officer
|
10,000
|
118,000
|
|
|
10,000
|
3,300
|
|
|
(e) Pension Benefits Table and
Non-Qualified Deferred Compensation
The
Corporation does not sponsor, and is not obligated to provide, any benefits
under any defined benefit or non-qualified deferred compensation
plan. The Corporation does provide a limited matching contribution
under the 401(k) Plan, as explained in “Compensation Discussion and Analysis”
above.
(f) Potential Payments Upon Termination
or Change-in-Control
For
information on severance to which the named executive officers may be entitled
upon termination of employment or in connection with a change of control, see
the subsection entitled “Termination and Change-of-Control Agreements” in the
Compensation Discussion and Analysis section above.
Upon
termination of employment, an employee is entitled to receive the dollar value
of accrued vacation leave but not medical leave. As of December 31,
2008, each of the named executive officers would have been entitled upon
termination of employment to receive the following dollar amount in exchange for
accrued, but unused vacation leave:
Name
|
Accrued
Vacation Leave
($)
|
Terry
M. Copeland, President, Chief Executive Officer and
Director
|
8,956
|
John
C. Fallini, Chief Financial Officer
|
4,702
|
Edward
H. Dickinson, Former Chief Financial Officer
|
31,133
|
Bruce
J. Sabacky, Vice President & Chief Technology Officer
|
42,569
|
Stephen
Balogh, Vice President Human Resources
|
638
|
C.
Robert Pedraza, Vice President Corporate Strategy
|
23,665
|
Compensation
of Directors
The
following table presents information regarding the compensation for the fiscal
year ended December 31, 2008 of all persons who served as directors of the
Corporation during 2008, except for Alan J. Gotcher, the Corporation’s former
President and former Chief Executive Officer and Terry Copeland, the
Corporation’s current President and Chief Executive officer, whose compensation
is described in the previous tables:
Name
|
Fees
Earned
Or
Paid in Cash(1)
($)
|
Stock
Awards(2)
($)
|
Option
Awards(3)
($)
|
Non-Equity
Incentive
Plan
Compensation
($)
|
Change
in
Pension
Value
And
Nonqualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compen-
sation
($)
|
Total
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
Eqbal
Al Yousuf
|
6,226
|
10,688
|
Nil
|
Nil
|
Nil
|
Nil
|
16,914
|
Michel
Bazinet
|
33,500
|
42,444
|
Nil
|
Nil
|
Nil
|
Nil
|
75,944
|
Jon
N. Bengtson
|
53,000
|
42,444
|
Nil
|
Nil
|
Nil
|
Nil
|
95,444
|
George
E. Hartman
|
35,500
|
42,444
|
Nil
|
Nil
|
Nil
|
Nil
|
77,944
|
Robert
Hemphill
|
25,000
|
26,058
|
2,520
|
Nil
|
Nil
|
Nil
|
53,578
|
Pierre
Lortie
|
48,500
|
18,694
|
15,673
|
Nil
|
Nil
|
Nil
|
82,867
|
Robert
van Schoonenberg
|
39,750
|
41,875
|
Nil
|
Nil
|
Nil
|
Nil
|
81,625
|
|
(1)
|
During
2008, the Corporation paid all directors who are not employees of the
Corporation a fee of $6,250 per quarter. In addition, directors who are
not employees and provide service in the following positions received the
following additional fees:
|
|
Position
|
Additional Compensation
|
|
Chairman
of the Board
|
$4,000
per quarter
|
|
Audit
Committee Chair
|
$3,000
per quarter
|
|
Compensation,
Nominating and Governance Committee Chair
|
$2,000
per quarter
|
|
Audit
or Compensation, Nominating and Governance Committee,
|
|
|
Or
Strategy Review Committee Member
|
$1,000
per quarter
|
|
Strategy
Review Committee Chair
|
$2,000
per quarter
|
|
Other
Committee Chair or Member
|
Determined
upon formation of
committee
|
Directors
are also entitled to receive compensation to the extent that they provide
services to the Corporation at rates that would be charged by such directors for
such services to arm’s length parties. No amounts were paid to Dr.
Gotcher or to Dr. Copeland in 2008 in their capacity as a director.
|
(2)
|
The
value reported for stock awards is based on the portion of restricted
stock that vested during the year ended December 31, 2008 and was booked
as compensation expense by the Corporation. A graded vesting
method was utilized to amortize the compensation expense. Under
this method, unvested amounts begin amortizing at the beginning of the
month in which the stock awards are granted. Unvested stock
awards held by each director at December 31, 2008 were as
follows: Mr. Al Yousuf – 5,000; Mr. Bazinet – 32,623 shares;
Mr. Bengtson – 32,623 shares; Mr. Hartman – 32,623 shares; Mr. Hemphill –
26,066 shares; Mr. Lortie – 6,557 shares; and Mr. van Schoonenberg –
33,815 shares.
|
|
(3)
|
Directors
of the Corporation and its subsidiaries are also entitled to participate
in the 1996 Plan, 1998 Plan and the 2005 Plan. An aggregate of
441,763 stock awards and option awards were outstanding and held by
directors as of December 31, 2008. The number of option
awards outstanding as of December 31, 2008 for each of the directors is as
follows: Mr. Hartman – 85,000 options; Mr. Hemphill – 4,000
options; Mr. Lortie – 36,667; Mr. Bazinet, Mr. Bengtson and Mr. van
Schoonenberg have no options
outstanding.
|
Audit Committee and Audit
Committee Report
Audit
Committee
The Audit
Committee operates pursuant to a written charter adopted by the Board, a copy of
which may be found on the Corporation’s website under the heading “Investors”
and is attached hereto as Appendix B. A copy may also be obtained
free of charge by mailing a request in writing to: Secretary, Altair
Nanotechnologies Inc., 204 Edison Way, Reno, Nevada 89502, U.S.A.
The Audit
Committee is comprised solely of non-employee directors, each of whom has been
determined by the Board to be independent under the requirements of the NASDAQ
listing standards and National Instrument 52-110 of the Canadian Securities
Administrators (“NI 52-110”). The Audit Committee is comprised of
Robert van Schoonenberg (Chair), Jon Bengtson, George Hartman and Pierre
Lortie. From September 2007 through April 7, 2008, the Audit
Committee was comprised of Jon Bengtson (Chair), George Hartman and Pierre
Lortie. If elected by the shareholders, Robert van Schoonenberg
(Chair), Jon Bengtson, George Hartman and Pierre Lortie are expected to be
members of the Audit Committee during 2009. The Audit Committee held
four meetings in person and six meetings via conference call during the fiscal
year ended December 31, 2008. In each of those meetings, two
directors attended in person and two via conference call.
The Board
has determined in its business judgment that each member of the Audit Committee
satisfies the requirements with respect to financial literacy set forth in
NASDAQ Rule 4350(d)(2)(A)(iv) and applicable Canadian securities laws; and the
Board has determined than Jon Bengtson is an “audit committee financial expert”
as such term is defined in Item 407(d)(5)(ii) of Regulation S-K promulgated
under the Securities Act by the U.S. Securities and Exchange Commission (“SEC”),
is independent under Item 7(b) of Schedule 14A under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”) and is, as a result of his past
employment experience in finance or accounting, requisite professional
certification in accounting or other comparable experience or background,
sophisticated with respect to financial matters.
The Audit
Committee’s responsibility is to assist the Board in its oversight of (a) the
quality and integrity of the Corporation’s financial reports, (b) the
independence and qualifications of the Corporation’s independent auditor, and
(c) the compliance by the Corporation with legal and regulatory
requirements. Management of the Corporation has the responsibility
for the Corporation’s financial statements as well as the Corporation’s
financial reporting process, principles and internal controls. The
Corporation’s independent public accounting firm is responsible for performing
an audit of the Corporation’s financial statements and expressing an opinion as
to the conformity of such financial statements with accounting principles
generally accepted in the United States of America.
Audit
Committee Report
The Audit
Committee reviewed and discussed the audited financial statements of the
Corporation as of and for the year ended December 31, 2008 with management and
with the independent public accounting firm. The Audit Committee has
discussed with the independent public accounting firm the matters required to be
discussed by Statement on Auditing Standards No. 61 (Communication with Audit
Committees), as currently in effect. In addition, the Audit Committee
has received the written disclosures and the letter from the independent public
accounting firm required by applicable requirements of the Public Company
Accounting Oversight Board regarding the independent auditor's communications
with the Audit Committee concerning independence, and has discussed with the
independent public accounting firm the independent auditor’s
independence.
The Audit
Committee has also considered whether the independent auditor’s provision of
non-audit services to the Corporation is compatible with maintaining the
auditors’ independence.
The
members of the Audit Committee are not engaged in the accounting or auditing
profession and, consequently, are not experts in matters involving auditing or
accounting including in respect of auditor independence. As such, it
is not the duty of the Audit Committee to plan or conduct audits or to determine
that the Corporation’s financial statements fairly present the Corporation’s
financial position and results of operation and are in accordance with generally
accepted accounting principles and applicable laws and
regulations. Each member of the Audit Committee is entitled to rely
on (i) the integrity of those persons within the Corporation and of the
professionals and experts (such as the independent auditor) from which the Audit
Committee receives information, (ii) the accuracy of the financial and other
information provided to the Audit Committee by such persons, professionals or
experts absent actual knowledge to the contrary and (iii) representations made
by management or the independent public accounting firm as to any information
technology services of the type described in Rule 2-01(c)(4)(ii) of Regulation
S-X and other non audit services provided by the independent auditor to the
Corporation.
Based on
the reports and discussions described above, the Audit Committee recommended to
the Board that the audited financial statements be included in the Corporation’s
Annual Report on Form 10-K for the year ended December 31, 2008, for filing with
the SEC.
AUDIT
COMMITTEE
Robert
van Schoonenberg, Chair
Jon
Bengtson
George
Hartman
Pierre
Lortie
March 11,
2009
Meetings of Directors and
Attendance at Shareholders Meetings
During
the year ended December 31, 2008, the Board held four meetings in person and
four meetings via conference call. All directors attended all of the
in-person meetings, with the exception of Michel Bazinet, who was unable to
attend one of the meetings. All directors participated in all
conference calls, with the exception of Robert Hemphill, who was unable to
attend three of the meetings held via conference call. In addition,
the Board considered and acted on certain matters throughout the year by
executing one consent resolution.
The
Corporation does not have a policy with respect to the attendance of shareholder
meetings by directors. All members of the Board attended the 2008
annual shareholders meeting.
Nominating
Committee
The
purpose of the Compensation, Nominating and Governance Committee related to
nomination of directors and corporate governance matters is (i) to recommend to
the Board the slate of director nominees for election to the Corporation’s Board
of Directors, individuals to fill Board vacancies occurring between annual
meetings of stockholders, and individuals for nomination as members of the
standing committees of the Board, and (ii) to develop and recommend to the Board
a set of corporate governance principles applicable to the
Corporation.
In
identifying nominees for directors, the Compensation, Nominating and Governance
Committee takes into consideration such factors as it deems
appropriate. These factors may include judgment, skill, diversity,
experience with businesses and other organizations of comparable size,
relationship of work experience and education to the current and proposed lines
of business of the Corporation, the interplay of the candidate’s experience with
the experience of other Board members, the extent to which the candidate would
be a desirable addition to the Board and any committees of the Board, and the
extent to which the candidate satisfies any objective requirements (such as
residence, independence or expertise requirements) applicable to the Board or
any committees of the Board. The Compensation, Nominating and
Governance Committee considers candidates submitted by shareholders in
accordance with the policies set forth in the most recent proxy statement
delivered to shareholders and may, but is not required to, consider candidates
proposed by management.
The
Compensation, Nominating and Governance Committee met seven times during 2008,
twice by telephone and five times in person. The members of the Compensation,
Nominating and Governance Committee are Pierre Lortie (Chair), Eqbal Al Yousuf,
Michel Bazinet and Robert van Schoonenberg, each of whom is independent under
NASDAQ’s listing standards. From January 1, 2008 through April 6,
2008, the members of the Compensation, Nominating and Governance Committee were
Pierre Lortie (Chair) and Michel Bazinet. From April 6, 2008 through
October 14, 2008, the members of the Compensation, Nominating and Governance
Committee were Pierre Lortie (Chair), Michel Bazinet and Robert van
Schoonenberg. From October 14, 2008 through June 3, 2009, the members of the
Compensation, Nominating and Governance Committee were Pierre Lortie (Chair),
Eqbal Al Yousuf, Michel Bazinet and Robert van Schoonenberg. The
charter governing operations of the Compensation, Nominating and Governance
Committee was initially adopted in April 2004, was updated in February 2007 and
is available at the Corporation’s website at www.altairnano.com under
“Investors” – “Governance.”
Shareholder Suggestions for
Nominees and Communications with the Board of Directors
The Board
will consider director candidates recommended by shareholders. Such
recommendations should include the name, age, address, telephone number,
principal occupation or employment, background and qualifications of the nominee
and the name, address and telephone number of and number of Common Shares owned
by the shareholder making the recommendation. Recommendations should
be sent to the Secretary of the Corporation at the address first set forth
above. Candidates submitted by shareholders in accordance with the policies set
forth in the most recent proxy statement delivered to shareholders are
considered under the same standards as nominees recommended by other
persons.
Shareholders
may send communications to the Board or to specified individual directors by
mailing such communications to the Secretary of the Corporation at the address
of the Corporation first set forth above and indicating that such communications
are for the Board or specified individual directors, as
appropriate. All communications received by mail are forwarded to the
directors to which they are addressed unless the communications contain
information substantially similar to that forwarded by the same shareholder, or
an associated shareholder, within the past 90 days.
Section 16(a) Beneficial
Ownership Reporting Compliance
Section
16(a) of the Exchange Act requires the Corporation’s officers and directors to
file reports concerning their ownership of Common Shares with the SEC and to
furnish the Corporation with copies of such reports. Based solely
upon the Corporation’s review of the reports required by Section 16 and
amendments thereto furnished to the Corporation, the Corporation believes that
all reports required to be filed pursuant to Section 16(a) of the Exchange Act
during 2008 were filed with the SEC on a timely basis except as
follows: (a) a Form 3 for John Harvat, General Counsel and
Vice President, was due on December 10, 2008 but was filed on January 31, 2009;
(b) a Form 4 for John Harvat was due on December 17, 2008 but was filed on April
7, 2009 (although information required in such Form 4 was included in a
previously filed Form 3) and (c) Forms 4 for Eqbal Al Yousuf and Al Yousuf LLC,
10% beneficial owners, were due on March 6, 2008 but were filed on April 17,
2008.
Code of Ethics and Code of
Conduct
The
Corporation has adopted the Code of Ethics for Senior Executive, Financial
Officers, Members of the Management Executive Committee, and Directors (the
“Code of Ethics”), which constitutes a code of ethics that applies to the
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, as defined in
Item 406 of Regulation S-K under the Exchange Act. The Code of Ethics
is available on the Corporation’s website at www.altairnano.com under
“Investors” – “Governance.”
The
Corporation has adopted the Altair Nanotechnologies Inc. Code of Conduct (the
“Code of Conduct”), which constitutes a code of conduct applicable to all
officers, directors and employees that complies with NASDAQ Rule
4350(n). The Code of Conduct is available on the Corporation’s
website at www.altairnano.com under “Investors” – “Governance.”
Securities Authorized for
Issuance under Equity Compensation Plans
Set forth
below is a summary of securities issued and issuable under all equity
compensation plans of the Corporation as at December 31, 2008. As of
the date hereof, the 1996 Plan, the 1998 Plan and the 2005 Plan are the only
equity compensation plans of the Corporation. In the table below,
outstanding securities information is presented for the 1996 Plan and the 1998
Plan, however, no new awards may be granted under these inactive
plans.
|
Number
of securities to be issued upon exercise of outstanding options, warrants
and rights
|
Weighted-average
exercise price of outstanding options, warrants and rights
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
|
Plan
Category
|
(a)
|
(b)
|
(c)
|
Equity
compensation plans approved by security holders
|
4,6,37,989
|
$3.028
|
5,420,419
|
Equity
compensation plans not approved by security holders
|
None
|
N/A
|
None
|
Total
|
4,637,989
|
$3.028
|
5,420,419
|
Statement of Corporate
Governance Practices
National
Policy 58-201 of the Canadian Securities Administrators has set out a series of
guidelines for effective corporate governance (the “Guidelines”). The Guidelines
address matters such as the constitution and independence of corporate boards,
the functions to be performed by boards and their committees and the
effectiveness and education of board members. National Instrument 58-101 (“NI
58-101”) of the Canadian Securities Administrators requires the disclosure by
each listed corporation of its approach to corporate governance with reference
to the Guidelines as it is recognized that the unique characteristics of
individual corporations will result in varying degrees of
compliance.
Set out
below is a description of the Corporation’s approach to corporate governance in
relation to the Guidelines.
1. The Board of
Directors
NI 58-101
defines an “independent director” as a director who has no direct or indirect
material relationship with the corporation. A “material relationship”
is in turn defined as a relationship that could, in the view of the
corporation’s board of directors, be reasonably expected to interfere with such
member’s independent judgement. The Board of Directors of the
Corporation is currently comprised of seven members, a majority of whom the
Board has determined are “independent directors” within the meaning of NI
58-101.
Dr.
Copeland is considered a non-independent director, as he is an officer of the
Corporation. Mr. Hemphill is an Executive Vice President of The AES
Corporation, an investor in the Corporation and potential business
partner. The Board of Directors believes that Mr. Hemphill is not
independent based on the significance of the ongoing joint development agreement
and potential customer relationship between the Corporation and an affiliate of
The AES Corporation. Mr. Al Yousuf controls Al Yousuf, LLC, which is an
approximately 21% shareholder in the Corporation. The Board of
Directors believes that Mr. Al Yousuf is independent despite his previous
financing activities and significant shareholdings based on the independence
from management he has exhibited at all times since his initial investment in
the Corporation and its general belief that being a significant shareholder is
not likely to interfere with the independence of Mr. Al Yousuf’s judgment (and
is likely to enhance it).
Messrs.
Bazinet, Bengtson, Hartman, van Schoonenberg, and Lortie are considered
independent directors since they are all independent of management and free from
any material relationship with the Corporation. The basis for this
determination is that, since the beginning of the fiscal year ended December 31,
2008, none of the independent directors have worked for the Corporation,
received more than CDN. $75,000 in annual remuneration from the Corporation,
excluding fees received for serving on the board of directors or any board
committee, or had material contracts with or material interests in the
Corporation which could interfere with their ability to act with a view to the
best interests of the Corporation.
The Board
believes that it functions independently of management. To enhance its ability
to act independent of management, the Board may meet in the absence of members
of management and the non-independent directors or may excuse such persons from
all or a portion of any meeting where a potential conflict of interest arises or
where otherwise appropriate. The Board held four meetings of the
independent directors in the absence of members of management and the
non-independent directors during the fiscal year ended December 31,
2008. Mr. Bengtson, Chairman of the Board, generally acts as the
chairman during meetings of the independent directors.
Additional
information concerning meetings of the Board held in fiscal 2008 is set forth
above under the heading “Meetings of the Directors and Attendance at
Shareholders Meeting.”
Mr.
Lortie currently serves as Chairman of the Board of Country Style Food Services,
is a director of Group Canam (TSX-V:CAM) and also a director of
Dynaplas. Mr. van Schoonenberg serves as a director of Guidance
Software, Inc. (NASDAQ:GUID). Mr. Al Yousuf serves as the Chairman of
the Board of ZAP, Inc.
The
responsibilities of the Chairman of the Board are to consult with other Board
members in determining the times and duration of the Board meetings, chair all
regular sessions of the Board and set the agenda for Board
meetings.
2. Board
Mandate
The Board
has a mandate to set the strategic direction of the Corporation and to oversee
its implementation by management of the Corporation. A copy of the
Board mandate is set forth in Appendix A to this Information Circular and a copy
may also be found on the Internet at http://altairannualmeeting.com.
3. Position
Descriptions
Given the
current size of the Corporation’s infrastructure and the existence of a limited
number of executive officers and seven directors, the Board does not feel that
it is necessary at this time to formalize position descriptions or corporate
objectives for any of the Chairman of the Board, Chairmen of committees of the
Board, or the President and Chief Executive Officer in order to delineate their
respective responsibilities. Accordingly, the roles of the executive
officers of the Corporation are delineated on the basis of the customary
practice.
4. Orientation and
Continuing Education
Although
the Corporation currently has no formal orientation and education program for
new Board members, sufficient information (such as recent annual reports,
prospectus, proxy solicitation materials and various other operating and budget
reports) is provided to any new Board member to ensure that new directors are
familiarized with the Corporation’s business and the procedures of the Board. In
addition, on at least an annual basis, the Board is given a presentation by an
attorney or other professional regarding their role, responsibilities and
obligations. In addition, new directors are encouraged to visit and
meet with management on a regular basis. The Corporation also
encourages continuing education of its directors and officers where appropriate
in order to ensure that they have the necessary skills and knowledge to meet
their respective obligations to the Corporation.
5. Ethical Business
Conduct
The Board
has adopted a formal code of conduct and code of ethics. See “Code of
Conduct and Code of Ethics” above. In order to
ensure compliance with the Code of Conduct and Code of Ethics, and to ensure
that directors exercise independent judgement, the Audit Committee has assumed
responsibility for approving transactions involving the Corporation and any
“related party” (as that term is defined in Multilateral Instrument Rule
61-101), except for
decisions related to compensation, which are approved by the Compensation,
Nominating and Governance Committee. The full Board is
responsible for monitoring the Corporation’s compliance with strategic planning
matters, implementing a process for assessing the effectiveness of committees of
directors and individual directors, and reviewing changes in or additions to
compliance policies, standards, codes and programs, as well as applicable
legislation.
6. Nomination of
Directors
The Board
has established a Compensation, Nominating and Governance Committee, which has
assumed the responsibility for identifying new candidates for Board
nomination. See “Nominating Committee” above.
7. Compensation
The Board
has established a Compensation, Nominating and Governance Committee, which has
assumed the responsibility for making recommendations to the Board on
compensation related matters. See “Composition of the Compensation
Committee” and “Compensation Committee Report on Executive Compensation”
above. Director compensation is evaluated using the same process as
the Corporation’s total compensation (see “Determination of Compensation” page
14).
8. Committees
In
addition to the Audit Committee and the Compensation, Nominating and Governance
Committee, the Board formed a standing Strategy Review Committee, the members of
which are Pierre Lortie, Michel Bazinet, George Hartman and Robert van
Schoonenberg in April 2008 which was eliminated in February 2009.
9. Assessments
The Board
assesses, on an annual basis, the contributions of the Board as a whole, the
Audit Committee and Compensation, Nominating and Governance Committee, and each
of the individual directors, in order to determine whether each is functioning
effectively. The Compensation, Nominating and Governance Committee
has responsibility for conducting and overseeing the annual self-evaluations for
the Board and reporting such results to the Board following the end of each
fiscal year. The evaluations, documented in the form of
questionnaires, include peer review evaluations and are based on such objective
and subjective criteria, as such committee deems
appropriate.
Interest of Informed Persons
in Material Transactions
Except as
otherwise disclosed in this Information Circular (see “Certain Relationships and
Related Transactions”), no informed person of the Corporation (within the
meaning of applicable Canadian securities laws), any nominee for election as a
director or any associate or affiliate thereof, has or has had any material
interest in any transaction since the commencement of the Corporation’s last
completed financial year, or in any proposed transaction, which has materially
affected or would materially affect the Corporation.
Indebtedness of Directors
and Executive Officers
There is
currently no outstanding indebtedness of (i) any present or former director,
executive officer or employee; or (ii) any associate of any current or former
director, executive officer or employee, either owing to the Corporation or any
of its subsidiaries, or owing to another entity which is the subject of a
guarantee, support agreement, letter of credit or similar arrangement or
understanding provided by the Corporation or any of its
subsidiaries.
Policies for Approval of
Related Party Transactions
The
Corporation’s Audit Committee has the authority and responsibility to review and
approve any proposed transactions between the Corporation (including its
subsidiaries) and any person that is an officer, key employee, director or
affiliate of the Corporation (or any subsidiary), other than transactions
related to the employment and compensation of such persons, which are reviewed
and approved by the Compensation, Nominating and Governance
Committee.
Vote Required and
Recommendation of the Board of Directors
In
connection with the election of directors, the seven nominees receiving the
highest number of votes will be elected.
The
Board recommends a vote FOR the election of the nominees for the Board of
Directors set forth herein.
PROPOSAL
NO. 2 — APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTING FIRM
Approval
of the appointment of Perry-Smith LLP as the independent public accounting firm
for the Corporation for the fiscal year ending December 31, 2009, and
authorization of the Audit Committee to set their remuneration, is to be voted
upon at the Meeting. Representatives of Perry-Smith LLP are expected
to be present at the Meeting but will not have an opportunity to make a
statement. Representatives of Perry-Smith LLP will be available to
respond to appropriate questions. Perry-Smith LLP was first appointed
auditors of the Corporation on September 26, 2005, prior to which Deloitte &
Touche LLP acted as auditors of the Corporation from 2001 to August 18,
2005.
Audit Fees. During
the fiscal years ended December 31, 2007 and 2008, the aggregate fees billed by
the Corporation’s independent public accounting firm for the audit of the
Corporation’s financial statements for such fiscal years, for the reviews of the
Corporation’s interim financial statements and for the review of SEC
registration statements, including the cost of auditing internal controls were
$154,450 and $161,760, respectively.
Audit-Related
Fees. No audit-related fees were paid during the fiscal years
ended December 31, 2007 or 2008.
Tax Fees. During
the fiscal years ended December 31, 2007 and 2008, the Corporation paid fees for
tax compliance, advice and planning of $56,514 and $66,905, respectively to
Perry-Smith LLP.
All Other
Fees. During the fiscal years ended December 31, 2007 and
2008, the Corporation paid Perry-Smith LLP $28,075 and $12,065, respectively, in
connection with other matters.
Audit Committee Pre-Approval
Policy. The Audit Committee pre-approves the services provided
to the Corporation by its independent public accounting firm in connection with
the audit of the Corporation’s annual financial statements, the review of the
Corporation’s quarterly financial statements and tax preparation and
consultation. Management is not permitted to engage its independent
public accounting firm for other audit or permitted non-audit services without
the case-by-case pre-approval of the Audit Committee. The Audit
Committee approved all the services provided to the Corporation by its
independent public accounting firm described above.
Vote Required and
Recommendation of the Board of Directors
The
affirmative vote of a majority of the votes cast on this proposal shall
constitute approval of the appointment of Perry-Smith LLP and authorization of
the Audit Committee to set their remuneration.
The
Board recommends a vote FOR approval of the appointment of Perry-Smith LLP as
the Corporation’s independent public accounting firm for the fiscal year ending
December 31, 2009 and authorization of the Audit Committee to set their
remuneration.
OTHER
MATTERS
Proposals of
Shareholders
Pursuant
to rules adopted by the SEC, if a shareholder intends to propose any matter for
a vote at the annual meeting of the shareholders to be held in 2010, but fails
to notify the Corporation of such intention prior to March 2, 2010, then a proxy
solicited by the Board may be voted on such matter in the discretion of the
proxy holder, without discussion of the matter in the proxy statement soliciting
such proxy and without such matter appearing as a separate item on the proxy
card.
In order
to be included in the proxy statement and form of proxy relating to the
Corporation’s annual meeting of shareholders to be held in 2010, proposals which
shareholders intend to present at such annual meeting must be received by the
Secretary of the Corporation, at the Corporation’s principal business office,
204 Edison Way, Reno, Nevada 89502, U.S.A. no later than December 17, 2009.
Undertakings
Unless
the Corporation has received contrary instructions, the Corporation intends to
deliver only one copy of this Information Circular and one copy of the Annual
Report for the year ended December 31, 2008 to multiple shareholders sharing the
same address. Upon written or oral request, the Corporation will
provide, without charge, an additional copy of such documents to each
shareholder at a shared address to which a single copy of such documents was
delivered. Shareholders at shared addresses that are receiving
a single copy of such documents but wish to receive multiple copies, and
shareholders at shared addresses that are receiving multiple copies of such
documents but wish to receive a single copy, should contact John Fallini, Chief
Financial Officer, at 204 Edison Way, Reno, Nevada, 89502, U.S.A., or at the
following telephone number: (775) 858-3750.
Additional
Information
Additional
information relating to the Corporation is available on SEDAR at www.sedar.com. Financial
information is provided in the Corporation’s comparative financial statements
and Management’s Discussion and Analysis of Financial Condition and Results of
Operations for the year ended December 31, 2008. Shareholders may
contact Shaun Drake at 360 Bay Street, Suite 500, Toronto, Ontario M5H 2V6,
Canada (416-361-0737), to request copies of the Corporation’s financial
statements and Management’s Discussion and Analysis of Financial Condition and
Results of Operations. In addition shareholders may download copies
of the Corporation’s proxy and latest annual report directly from its website at
www.altairnano.com.
Upon
written or oral request, the Corporation will provide, without charge, to each
person to whom a copy of this Information Circular has been delivered, a copy of
the Corporation’s Annual Report on Form 10-K for the year ended December 31,
2008 filed with the SEC (other than the exhibits except as expressly
requested). Requests should be directed to John Fallini, Chief
Financial Officer, at 204 Edison Way, Reno, Nevada, 89502, U.S.A., or at the
following telephone number: (775) 858-3750.
* * * * * * * * *
The
contents and sending of this Information Circular have been approved by the
directors of the Corporation.
Dated as
of the 16th day of April, 2009.
|
ALTAIR
NANOTECHNOLOGIES INC.
|
|
/s/
Terry M. Copeland
|
|
Terry
M. Copeland, President and Chief Executive
Officer
|
Appendix
A
Copy of
Board Mandate
[see
attached]
Mandate of the Board of
Directors
Mandate
The Board
of Directors (the “Board”) of Altair Nanotechnologies Inc. (the “Company”) will
oversee the governance of the Company’s business.
Directors
shall exercise their judgment in a manner consistent with their fiduciary
duties. In particular, directors are required to act honestly and in good
faith, with a view to the best interests of the Company and its shareholders and
to exercise the care, diligence and skill that a reasonably prudent person would
exercise in comparable circumstances.
Responsibilities
The Board
discharges its responsibilities directly, through delegation to committees of
the Board and, as appropriate, through delegation to individual
directors.
The
Board’s responsibilities, to be discharged directly, through delegation to
committees of the Board and, as appropriate, through delegation to individual
directors shall include:
Oversight of
Management
|
·
|
Participating
in the selection, appointment, development, evaluation and compensation of
the Chief Executive Officer (“CEO”) and other senior officers directly and
through the Compensation and Nominating
Committee.
|
|
·
|
Promoting,
by the actions of the Board and its individual directors, a culture of
integrity throughout the Company, consistent with the Company’s Code of
Conduct and Code of
Ethics. By the Board’s oversight of senior officers, the
Board will encourage the CEO and other executive officers to act with
integrity and to create a culture of integrity throughout the
Company.
|
|
·
|
Periodically
reviewing the Company’s Code of
Conduct and
Code of Ethics and making changes as
appropriate.
|
Financial and Risk
Matters
|
·
|
Overseeing
the reliability and integrity of the financial statements and other
publicly reported financial information, and of the disclosure principles
and practices followed by
management.
|
|
·
|
Overseeing
the integrity of the Company’s internal controls and management
information.
|
|
·
|
Reviewing
and approving an annual operating budget for the Company and its
subsidiaries on a consolidated basis and monitoring the Company’s
performance against such budget.
|
|
·
|
Reviewing
and approving quarterly financial statements and the release thereof by
management.
|
|
·
|
Overseeing
the Company’s controls and procedures for the preparation and
dissemination of current reports and news releases in an effort to ensure
that material information is disseminated in a timely and accurate
fashion.
|
|
·
|
Periodically assessing the
processes utilized by management with respect to risk assessment and risk
management, including the identification by management of the principal
risks of the business of the Company, and the implementation by management
of appropriate systems to deal with such
risks.
|
Business
Strategy
|
·
|
Adopting
a strategic planning process pursuant to which management develops and
proposes, and the Board reviews and approves, significant corporate
strategies and objectives, taking into account the opportunities and risks
of the business.
|
|
·
|
Reviewing
and approving all major acquisitions, dispositions and investments and all
significant financings and other significant matters outside the ordinary
course of the Company’s business.
|
Corporate
Governance
|
·
|
Overseeing
the development, implementation and operation of the Company’s corporate
governance initiatives.
|
|
·
|
Taking
appropriate steps to remain informed about the Board’s duties and
responsibilities and about the business and operations of the
Company.
|
|
·
|
Ensuring
that the Board receives from senior officers the information and input
required to enable the Board to effectively perform its
duties.
|
|
·
|
Assessing
the performance of the Chairman of the Board, the Chairperson of each
committee of the Board and each
director.
|
Appendix
B
Copy
of Audit Committee Charter
[see
attached]
ALTAIR
NANOTECHNOLOGIES, INC.
AUDIT
COMMITTEE CHARTER
The Audit
Committee (“Committee”) is appointed by the Board of Directors (“Board”) to
assist the Board in monitoring (1) the integrity of the financial statements of
the Company, (2) compliance by the Company with legal and regulatory
requirements, (3) the independent auditor’s qualifications and independence, (4)
performance of the Company’s internal and independent public accounting firm,
and (5) the business practices and ethical standards of the
Company. The Committee is also directly responsible for (a) the
appointment, compensation, retention and oversight of the work of the Company’s
independent public accounting firm, and (b) the preparation of the report that
the Securities and Exchange Commission (“Commission”) requires to be included in
the Company’s annual proxy statement. While the Committee has the
responsibilities and powers set forth in this Charter, it is not the duty of the
Committee to plan or conduct audits or to determine that the Company’s financial
statements and disclosures are presented fairly in all material respects in
accordance with generally accepted accounting principles. These are
the responsibility of management and the independent auditor.
Independence. The Committee
shall consist of three or more members of the Board of Directors, each of whom
shall be independent. Independence shall be determined as to each member by the
full board. To be considered independent, each Committee member must meet the
independence requirements applicable to Audit Committees of companies listed on
the NASDAQ Stock Market (“NASDAQ”) under NASDAQ rules and the securities laws of
the United States and Canada, and rules promulgated thereunder (the “Securities
Laws”). Audit Committee members shall not simultaneously serve on the audit
committees of more than two other public companies.
Financial
Literacy. All members of the Committee shall be
financially literate, as defined by the Commission, or must become financially
literate within a reasonable period of time after their appointment to the
Committee, and at least one member of the Committee shall be an audit committee
financial expert, as determined in the judgment of the Board with reference to
the Securities Laws and NASDAQ rules.
III.
|
COMMITTEE
COMPOSITION
|
The
members of the Committee shall be nominated by the Compensation, Nominating and
Corporate Governance Committee and appointed by the Board at the annual
organizational meeting of the Board and shall serve until their successors shall
be duly elected and qualified. The Board may remove any member of the
Committee at any time.
Chairman. Unless a Chairman
is elected by the full Board, the members of the Committee shall designate a
Chair by majority vote of all the Committee members.
The
Committee shall meet at least four times annually or more frequently as
circumstances dictate. Meetings may be in person or by telephone as needed to
conduct the business of the Committee. The Committee may take action
by the unanimous written consent of the members in the absence of a
meeting. The Committee shall meet periodically with management, the
internal auditors and the independent auditor is separate executive
sessions.
V.
|
AUTHORITY
AND RESPONSIBILITY OF THE COMMITTEE
|
The Audit
Committee shall have the authority (1) to exercise all powers with respect to
the appointment, compensation, retention and oversight of the work of the
independent auditor for the Company and its subsidiaries, (2) to retain special
legal, accounting or other consultants to advise the Committee and to pay the
fees of such advisors and (3) to determine the amount of funds it needs to
operate and direct the CFO make such funds available. As part of its
oversight role, the Committee may investigate any matter brought to its
attention, with the full power to retain outside counsel or other experts for
this purpose. Unless special circumstances require the fact or terms
of any engagement or appointment made by the Committee to be kept confidential
from the Chief Financial Officer, the Committee shall promptly notify the Chief
Financial Officer of the fact and terms of any appointment or engagement, and
provide copies of related agreements, and shall cause all invoices to be
forwarded to or at the direction of the Chief Financial Officer promptly
following receipt. Confidential portions of any agreement or invoice
may be redacted. The Audit Committee may request any officer of
employee of the Company or the Company’s outside counsel or independent auditor
to attend a meeting of the Committee or to meet with any member of, or
consultant to, the Committee. Without limiting the generality of the
foregoing, the Audit Committee shall:
Financial
Statements and Disclosure Matters
|
1.
|
Review
and discuss prior to public dissemination the annual audited and quarterly
unaudited financial statements with management and the independent
auditor, including major issues regarding accounting, disclosure and
auditing procedures and practices as well as the adequacy of
internal controls that could materially affect the Company’s financial
statements. In addition, the review shall include the Company’s
disclosures under “Management’s Discussion and Analysis of Financial
Condition and Results of Operations.” Based on the annual
review, the Audit Committee shall recommend inclusion of the financial
statements in the Annual Report on Form 10-K to the
Board.
|
|
2.
|
Discuss
with management and the independent auditor significant financial
reporting issues and judgments made in connection with the preparation of
the Company’s financial statements, including any significant changes in
the Company’s selection or application of accounting principles, any major
issues as to the adequacy of the Company’s internal controls and any
special steps adopted in light of material control
deficiencies.
|
|
3.
|
Review
and discuss reports from the independent public accounting firm
on:
|
|
A.
|
Critical
accounting policies and practices to be
used.
|
|
B.
|
Alternative
treatments of financial information within generally accepted accounting
principles that have been discussed with management, ramification of the
use of such alternative disclosures and treatments, and the treatment
preferred by the independent
auditor.
|
|
C.
|
Other
material written communications between the independent auditor and
management, such as any management
letter.
|
|
4.
|
Discuss
with management the Company’s earnings press releases as well as financial
information and earnings guidance provided to analysts and rating
agencies. Such discussion may be done generally consisting of
discussing the types of information to be disclosed and the types of
presentations to be made. In its discretion, the Committee may
adopt policies requiring specific reviews and approvals with respect to
press releases, SEC reports and other disclosures, whether or not
financial in nature.
|
|
5.
|
Discuss
with management and the independent auditor the effect on the Company’s
financial statements of significant regulatory and accounting initiatives
as well as off-balance sheet
structures.
|
|
6.
|
Discuss
with management the Company’s major financial risk exposures and the steps
management has taken to monitor and control such exposures, including the
Company’s risk assessment and risk management
policies.
|
|
7.
|
Review
with the independent auditor any audit problems or difficulties and
management responses, including but not limited to (1) any restrictions on
the scope of the auditor’s activities, (2) any restrictions on the access
of the independent auditor to requested material, (3) any significant
disagreements with management and (4) any audit differences that were
noted or proposed by the auditor but for which the Company’s financial
statements were not adjusted (as immaterial or otherwise). The
Committee will resolve any disagreements between the auditors and
management regarding financial
reporting.
|
|
8.
|
Review
disclosures made to the Audit Committee by the Company’s CEO and CFO
during their certification process for the Form 10-K and Form 10-Q about
any significant deficiencies in the design or operation of disclosure
controls and procedures and internal controls over financial reporting and
any fraud involving management or other employees who have a significant
role in the Company’s internal
controls.
|
|
9.
|
Discuss
at least annually with the independent auditor the matters required to be
discussed by Statement of Auditing Standards No. 61 - Communication with
Audit Committees.
|
|
10.
|
Prepare
the Audit Committee report that the Commission requires to be included in
the Company’s annual proxy statement and review the matters described in
such report.
|
|
11.
|
Obtain
from management the annual report on internal controls over financial
reporting required by governing rules, as well as the independent
auditor’s attestation report on management’s assessment of internal
controls over financial reporting.
|
|
Responsibility
For The Company’s Relationship With The Independent
Auditor
|
|
12.
|
Be
solely responsible for the appointment, compensation, retention and
oversight of the work of the independent public accounting firm employed
by the Company. The independent auditor shall report directly
to the Audit Committee. If the appointment of the independent
public accounting firm is submitted for any ratification by stockholders,
the Audit Committee shall be responsible for making the recommendation of
the independent public accounting
firm.
|
|
13.
|
Review,
at least annually, the qualifications, performance and independence of the
independent auditor. In conducting such review, the Committee
shall obtain and review a report by the independent auditor describing (1)
the firm’s internal quality-control procedures, (2) any material issues
raised by the most recent internal quality-control review, or peer review,
of the firm or by any formal investigation by governmental or professional
authorities regarding services provided by the firm which could affect the
financial statements of the Company, and any steps taken to deal with any
such issues, and (3) all relationships between the independent auditor and
the Company that could be considered to bear on the auditor’s
independence. This evaluation shall include the review and
evaluation of the lead partner of the independent auditor and shall ensure
the rotation of partners in accordance with Commission rules and the
securities laws. In addition, the Committee shall consider the
advisability of regularly rotating the audit firm in order to maintain the
independence between the independent auditor and the
Company.
|
|
14.
|
Approve
in advance any audit or permissible non-audit engagement or relationship
between the Company and the independent public accounting
firm. The Committee shall establish guidelines for the
retention of the independent auditor for any permissible non-audit
services. The Committee hereby delegates to the Chairman of the
Committee the authority to approve in advance all audit or non-audit
services to be provided by the independent auditor if presented to the
full Committee at the next regularly scheduled
meeting.
|
|
15.
|
Meet
with the independent auditor prior to the audit to review the planning and
staffing of the audit including the responsibilities and staffing of the
Company’s internal audit department personnel who will assist in the
audit.
|
|
16.
|
Recommend
to the Board policies for the Company’s hiring of employees or former
employees of the independent auditor who participated in any capacity in
the audit of the Company.
|
|
17.
|
Ensure
its receipt from the independent public accounting firm of a formal
written statement delineating all relationships between the auditor and
the company, consistent with Independence Standards Board Standard 1,
engage in a dialogue with the auditor with respect to any disclosed
relationships or services that may impact the objectivity and independence
of the auditor and take, or recommend that the Board take, appropriate
action to oversee the independence of the outside
auditor.
|
|
Oversight
Of The Company’s Internal Audit
Function
|
|
18.
|
Review
the appointment and replacement of the senior internal auditing executive
or functional outside equivalent.
|
|
19.
|
Review
the activities and organizational structure of the internal auditing
function and the significant reports to management prepared by the
internal auditing department and management’s
responses.
|
|
20.
|
Discuss
with the independent auditor and management the internal audit function
responsibilities, budget and staffing and any recommended changes in the
planned scope of the internal audit
department.
|
|
21.
|
Obtain
from the independent auditor assurance that Section 10A (b) of the
Securities Exchange Act of 1934, as amended, has not been
implicated.
|
|
22.
|
Obtain
reports from management and the Company’s internal auditing function that
the Company is in conformity with applicable legal requirements and the
Company’s Code of Conduct and its Code of Ethics for Senior
Executives, Financial Officers and Members of the Management Executive
Committee (the “Codes”). Advise the Board with respect to the
Company’s policies and procedures regarding compliance with applicable
laws and regulations and with the
Codes.
|
|
23.
|
Establish
and maintain procedures for the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal controls
or auditing matters. Also, the Committee shall maintain the Anonymous
Reporting Hotline for the confidential anonymous submission by employees
of the Company of concerns regarding questionable accounting, internal
controls or auditing matters.
|
|
24.
|
Discuss
with management and the independent auditor any correspondence with
regulators or governmental agencies and any published reports that raise
material issues regarding the Company’s financial statements or accounting
policies.
|
|
25.
|
Review
at least annually legal matters with the Company’s General Counsel that
may have a material impact on the financial statements, the Company’s
compliance policies, including but not limited to the Foreign Corrupt
Practices Act, and any material reports or inquires received from
regulators or governmental
agencies.
|
|
Review
of Related Party Transactions
|
|
26.
|
Review
and approve (or decline to approve) any proposed transactions between the
Company (including its subsidiaries) and any person that is an officer,
key employee, director or affiliate of the Company (or any subsidiary),
other than transactions that related to the employment and compensation of
such persons and are within the scope of the charter of the Compensation,
Nominating and Governance Committee Charter. Review disclosures required
to be made under the securities laws of insider and affiliated party
transactions.
|
|
27.
|
Report
regularly to the Board with respect to any issues that arise with respect
to the quality or integrity of the Company’s financial statements, the
Company’s compliance with legal or regulatory requirements, the
performance and independence of the Company’s independent public
accounting firm or the performance of the internal audit
function.
|
|
28.
|
Review
and reassess the adequacy of this Charter annually and recommend any
proposed changes to the Board for
approval.
|
|
29.
|
Perform
an annual performance
self-evaluation.
|
COMMITTEE
OPERATIONS
The
Committee shall meet in person or telephonically at a time and place determined
by the Chairman of the Committee, with further meeting to occur, or actions to
be taken by unanimous written consent, when deemed appropriate or desirable by
the Committee Chairman. A majority of the Committee members shall
constitute a quorum for the transaction of business. The action of a
majority of those present at a meeting when a quorum is present will constitute
the actions of the Committee. The Secretary of the Company, or
his or her designee, will keep minutes of all Committee meetings, which will be
distributed to all members of the Board. Prior to each meeting, a
preliminary agenda will be prepared by either the Secretary or the Chairman of
the Committee. The Chairman of the Committee will make the final
decision regarding the agenda. The agenda and all materials to be
reviewed at the meeting shall be received by the Committee members as far in
advance of the meeting date as reasonably practicable. The Committee
shall have such resources and authority as it deems desirable or appropriate to
discharge its duties and responsibilities, including the authority to obtain
advice and assistance from internal or external legal, human resource,
accounting or other experts, advisors or consultants, without seeking approval
of the Board or management. Such independent advisors may be the
regular advisors of the Company. The Committee shall have the
authority to conduct or authorize investigations into any matters within the
scope of its responsibilities as it shall deem appropriate, including the
authority to request any officer, employee or advisor of the Company to meet
with the Committee or any advisors engaged by the Committee.
PROXY
Altair
Nanotechnologies Inc.
Annual
Meeting of Shareholders
on
June
4, 2009
This
Proxy Is Solicited By The Board of Directors Of
Altair
Nanotechnologies Inc.
The
undersigned shareholder of Altair Nanotechnologies Inc. (the "Corporation")
hereby nominates, constitutes and appoints Terry M. Copeland, President, or
failing him, John Fallini, Chief Financial Officer, or instead of any of them,
___________________________, as nominee of the undersigned to attend and vote
for and on behalf of the undersigned at the annual meeting of shareholders of
the Corporation (the "Meeting") to be held on the 4th day of June, 2009 and at
any adjournment or adjournments thereof, to the same extent and with the same
power as if the undersigned were personally present at the said meeting or such
adjournment or adjournments thereof, and without limiting the generality of the
power hereby conferred, the nominees are specifically directed to vote the
shares represented by this proxy as indicated below.
This
proxy also confers discretionary authority to vote in respect of any amendments
or variations to the matters identified in the Notice of Meeting, matters
incident to the conduct of the Meeting and any other matter which may properly
come before the Meeting about which the Corporation did not have notice as of
the date 45 days before the date on which the Corporation first mailed proxy
material to shareholders and in such manner as such nominee in his judgement may
determine.
A
shareholder has the right to appoint a person to attend and act for him and on
his behalf at the Meeting other than the persons designated in this form of
proxy. Such right may be exercised by filling the name of such person
in the blank space provided or by completing another proper form of proxy and,
in either case, depositing the proxy as instructed below.
To
be valid, this proxy must be received by the transfer agent of the Corporation
at 120 Adelaide Street West, Suite 420, Toronto, Ontario M5H 4C3, Canada not
later than 48 hours (excluding Saturdays and holidays) before the time of
holding the Meeting or adjournment thereof, or delivered to the chairman on the
day of the Meeting or adjournment thereof.
The
nominees are directed to vote the shares represented by this proxy as
follows:
|
(1)
|
ELECTION
OF DIRECTORS, each to serve until the next annual meeting of shareholders
of the Corporation or until their respective successor shall have been
duly elected, unless earlier terminated in accordance with the bylaws of
the Corporation:
|
□ FOR
all nominees listed below (except as marked to the contrary).
□ WITHHOLD
AUTHORITY to vote for all nominees listed below.
(INSTRUCTION: To
withhold authority to vote for any individual nominee, strike a line through the
nominee's name in the list below.)
Eqbal
Al Yousuf
|
|
Jon
N. Bengtson
|
|
George
E. Hartman
|
|
Robert
F. Hemphill, Jr.
|
|
Pierre
Lortie
|
|
Robert
G. van Schoonenberg
|
|
Terry
M. Copeland
|
|
|
|
|
|
[See
Reverse Side]
|
(2)
|
Proposal
to appoint Perry-Smith LLP as independent public accounting firm of the
Corporation for the fiscal year ending December 31, 2009 and to authorize
the Audit Committee of the Board of Directors to fix their
remuneration.
|
|
(3)
|
At
the nominee's discretion upon any amendments or variations to matters
specified in the notice of the Meeting, matters incident to the conduct of
the Meeting, and upon any other matters as may properly come before the
Meeting or any adjournments thereof about which the Corporation did not
have notice as of the date 45 days before the date on which the
Corporation first mailed proxy materials to
shareholders.
|
THE
SHARES REPRESENTED BY THIS PROXY WILL BE VOTED OR WITHHELD FROM VOTING IN
ACCORDANCE WITH THE INSTRUCTIONS GIVEN ON ANY VOTE OR BALLOT CALLED FOR AT THE
MEETING AND, WHERE A SHAREHOLDER HAS SPECIFIED A CHOICE, WILL BE VOTED OR
WITHHELD FROM VOTING ACCORDINGLY. UNLESS A SPECIFIC INSTRUCTION IS INDICATED,
SAID SHARES WILL BE VOTED IN FAVOUR OF ALL NOMINEES OF THE BOARD OF DIRECTORS
AND IN FAVOUR OF THE APPOINTMENT OF AUDITORS, ALL OF WHICH ARE SET
FORTH IN THE INFORMATION CIRCULAR, ACCOMPANYING THIS PROXY, WHICH IS
INCORPORATED HEREIN BY REFERENCE AND RECEIPT OF WHICH IS HEREBY
ACKNOWLEDGED.
This
proxy revokes and supersedes all proxies of earlier date.
DATED
this ____ day of ________________, 2009.
PRINT
NAME: _______________________________
SIGNATURE:
________________________________
NOTES:
(1)
|
This
proxy must be signed by the shareholder or the shareholder’s attorney duly
authorized in writing, or if the shareholder is a corporation, by the
proper officers or directors under its corporate seal, or by an officer or
attorney thereof duly authorized.
|
(2)
|
A
person appointed as nominee to represent a shareholder need not be a
shareholder of the Corporation.
|
(3)
|
If
not dated, this proxy is deemed to bear the date on which it was mailed on
behalf of the management of the
Corporation.
|
(4)
|
Each
shareholder who is unable to attend the Meeting is respectfully requested
to date and sign this form of proxy and return it using the self-addressed
envelope provided.
|
Important
Notice Regarding the Availability of Proxy Materials for the Annual Meeting to
be held on June 4, 2009.
The Corporation’s Annual Report to
Stockholders and Proxy Statement are available on the Internet at http:// www.altairannualmeeting.com.
ALTAIR
NANOTECHNOLOGIES
INC.
NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that an
annual meeting (the "Meeting") of the shareholders of Altair Nanotechnologies
Inc. (the "Corporation") will be held at the Grand Sierra Resort, 2500 E. 2nd Street,
Reno, Nevada 89502, Thursday, the 4th day of June 2009, at the hour of 10:00
o'clock in the morning (Pacific time) for the following purposes:
(1)
|
To
receive the audited financial statements of the Corporation for the twelve
months ended December 31, 2008, together with the report of the
auditors thereon;
|
(3)
|
To
authorize the appointment of the auditors and to authorize the Audit
Committee of the Board of Directors to fix their remuneration;
and
|
(4)
|
To
transact such further or other business as may properly come before the
Meeting or any adjournment or adjournments
thereof.
|
This
notice is accompanied by a form of proxy, a management information circular and
the annual report to shareholders of the Corporation containing the audited
consolidated financial statements of the Corporation for the fiscal year ended
December 31, 2008.
Proxies
to be used at the meeting must be deposited at the office of the transfer agent
not later than 48 hours (excluding Saturdays and holidays) before the time of
holding the meeting.
Shareholders
who are unable to attend the Meeting in person are requested to complete, date,
sign and return the enclosed form of proxy so that as large a representation as
possible may be had at the Meeting.
DATED at
Toronto, Ontario as of the 14th day of April, 2009.
|
BY: ORDER
OF THE BOARD
(Sgd.) Terry
M. Copeland
President
and Chief Executive Officer
|