SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
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ULTRALIFE BATTERIES, INC.
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(Name of Registrant as Specified in Its Charter)
NOT APPLICABLE
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ULTRALIFE BATTERIES, INC.
1350 ROUTE 88 SOUTH
P.O. BOX 622
NEWARK, NEW YORK 14513
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
DECEMBER 5, 1996
Notice is hereby given that the 1996 Annual Meeting of Stockholders (the
"Meeting") of Ultralife Batteries, Inc. (the "Company") will be held on
Thursday, December 5, 1996 at 10:00 A.M. at the offices of The Chase Manhattan
Bank, 410 Park Avenue, 5th floor, The Board Room, New York, New York for the
following purposes:
1. To elect directors for a term of one year and until their successors
are duly elected and qualified.
2. To approve and ratify an option granted to the Company's Chief
Executive Officer pursuant to his Employment Agreement dated
March 29, 1994.
3. To transact such other business as may properly come before the
meeting and any adjournments thereof.
Only stockholders of record of common stock, par value $.10 per share, of
the Company at the close of business on November 1, 1996 are entitled to receive
notice of, and to vote at and attend the Meeting. At least 10 days prior to the
Meeting, a complete list of stockholders entitled to vote will be available for
inspection by any stockholder, for any purpose germane to the Meeting, during
ordinary business hours, at 711 Third Avenue, Suite 1505, New York, NY 10017
attn: Paul Share, Esq. If you do not expect to be present you are requested to
fill in, date and sign the enclosed Proxy, which is solicited by the Board of
Directors of the Company, and to promptly return it in the enclosed envelope. In
the event you decide to attend the Meeting in person, you may, if you desire,
revoke your proxy and vote your shares in person.
By Order of the Board of Directors
Bruce Jagid
Chairman of the Board of Directors
and Chief Executive Officer
Dated: October 31, 1996
===============================================================================
IMPORTANT
Regardless of whether or not you plan to attend the meeting, you are urged to
complete, sign and return the enclosed proxy in the envelope provided, which
requires no postage if mailed in the United States.
===============================================================================
ULTRALIFE BATTERIES, INC.
1350 ROUTE 88 SOUTH
P.O. BOX 622
NEWARK, NEW YORK 14513
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
DECEMBER 5, 1996
INFORMATION CONCERNING SOLICITATION AND VOTING
This proxy statement is furnished in connection with the solicitation on
behalf of the Board of Directors of Ultralife Batteries, Inc. (the "Company")
for use at the 1996 Annual Meeting of Stockholders (the "Meeting") to be held on
Thursday, December 5, 1996 at 10:00 A.M. and any adjournments thereof. The
Meeting will be held at the offices of The Chase Manhattan Bank, 410 Park
Avenue, 5th floor, The Board Room, New York, New York.
When a proxy is returned properly signed, the shares represented thereby
will be voted in accordance with the stockholder's directions. If the proxy is
signed and returned without choices having been specified, the shares will be
voted for the election as directors of the persons named herein, and "FOR"
Proposal 2 described below. If for any reason any of the nominees for election
as directors shall become unavailable for election, discretionary authority may
be exercised by the proxies to vote for substitutes proposed by the Board of
Directors of the Company. A stockholder giving a proxy has the right to revoke
it at any time before it is voted by filing with the Secretary of the Company a
written notice of revocation, or a duly executed later-dated proxy, or by
requesting return of the proxy at the Meeting and voting in person.
Only stockholders of record at the close of business on November 1, 1996
are entitled to notice of, and to vote at, the annual meeting of stockholders.
As of November 1, 1996, there were 7,926,711 shares of the Company's stock, par
value $.10 per share ("Common Stock"), outstanding, each entitled to one vote
per share at the Meeting.
The cost of solicitation of proxies will be borne by the Company. In
addition to the solicitation of proxies by use of the mails, some of the
officers, directors and regular employees of the Company, without extra
remuneration, may solicit proxies personally or by telephone, telefax or similar
transmission. The Company will reimburse record holders for expenses in
forwarding proxies and proxy soliciting material to the beneficial owners of the
shares held by them.
The approximate date on which the enclosed form of proxy and this proxy
statement are first being sent to stockholders of the Company is November 4,
1996.
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors currently has 8 directors. Directors are elected by
a plurality of the votes cast by the stockholders of the Company at a
stockholders meeting at which a quorum of shares is represented. Each director
shall serve until the next annual stockholders meeting and until the successor
of such directors shall have been elected and qualified. The names of, and
certain information with respect to, the persons nominated for election as
directors are presented on the following pages.
Name Age Present Principal Occupation and Employment History
Bruce Jagid 56 Mr. Jagid, a founder of the Company, has been a
director and the Company's Chairman since March
1991 and its Chief Executive Officer since January
1992. Mr. Jagid has over 25 years experience in the
technical and business aspects of the energy
conversion field. Together with Mr. Rosansky, Mr.
Jagid founded Power Conversion, Inc. ("PCI") in
1970, where he was the President until January
1989. PCI was sold to Hawker Siddely PLC in 1986.
Since January 1989, Mr. Jagid pursued private
investment activities. Prior to joining PCI, Mr.
Jagid was employed at Leesona Moos Laboratories
from 1965 to 1969 where, at various times, he
served as assistant marketing manager and director
of developmental engineering. Prior to joining
Leesona Moos, he was a Senior Analytical Engineer
in the advanced power systems group at Pratt and
Whitney Aircraft. Mr. Jagid is a director of
several private companies and THQ, Inc. Mr. Jagid
holds numerous patents in the area of battery
technology and has authored several publications on
the subject.
Martin Rosansky 58 Mr. Rosansky, a founder of the Company, has been a
director since March 1991 and the Company's Vice
Chairman since January 1992. Mr. Rosansky, a
co-founder of PCI in 1970, has 30 years experience
in the engineering, design and production of
battery and fuel-cell systems. He was Chairman of
the Board, Secretary and Treasurer at PCI from 1970
to January 1989, when he left PCI to pursue private
investment activities. PCI was sold to Hawker
Siddely PLC in 1986. Prior to joining PCI, Mr.
Rosansky was a Research Engineer at American
Cyanamid Co., developing and fabricating new energy
storage devices. Prior to joining American Cyanamid
Co., Mr. Rosansky was a staff engineer at Sonotone
Corporation, where his work was directed at the
diversification of the company product line through
the development of new types of nickel-cadmium
batteries, electrochemical systems and associated
ancillary equipment. Mr. Rosansky was a project
engineer at Leesona Moos Laboratories, where he
designed, developed and fabricated fuel cell
modules and integrated fuel cell systems. Mr.
Rosansky is a director of several private
companies. Mr. Rosansky holds numerous patents and
has authored several publications in the field of
battery technology.
Joseph N. Barrella 50 Mr. Barrella, a founder of the Company, has been a
director and the Company's President since March
1991 and the Company's Chief Operating Officer
since October 1992. Prior thereto, Mr. Barrella
spent seven years as Director of Engineering at
PCI, from May 1984 to January 1991. Mr. Barrella
has been involved in the development and
manufacture of lithium batteries for more than 20
years. Prior to joining PCI, Mr. Barrella was the
lithium systems project manager at Duracell,
working on the initial development of the lithium
sulfur dioxide cells. Mr. Barrella began his career
in 1968 as an engineer at Grumman Aerospace where
he remained for four years, working on the research
and development of high rate silver-zinc batteries.
He holds a number of patents relating to lithium
battery designs and has authored several
publications relating to battery technology.
2
Name Age Present Principal Occupation and Employment History
Joseph C. Abeles 81 Mr. Abeles, a founder of the Company, has been a
director and Treasurer since March 1991. Mr.
Abeles, formerly a director of PCI, is a private
investor and currently serves as a director of a
number of companies, including Intermagnetics
General Corporation ("IGC") and Bluegreen
Corporation (formerly Patten Corporation). In 1951
he founded Kawecki Chemical Co. and served as
Chairman and CEO of Kawecki Berylco Industries from
1969 to 1978.
Arthur Lieberman 61 Mr. Lieberman has been a director and the Company's
Secretary since March 1991. Mr. Lieberman is a
founder, and since 1981 has been the senior partner
of Lieberman & Nowak, a legal firm specializing in
intellectual property law which for many years has
represented clients in the battery industry and
related fields. Lieberman & Nowak has represented
the Company in connection with certain intellectual
property matters. Mr. Lieberman is a director of
University Patents, Inc.
Carl H. Rosner 67 Mr. Rosner, a director of the Company since January
1992, is the Chairman, President, and Chief
Executive Officer of IGC. Mr. Rosner has been
Chairman of IGC since its formation and President
and Chief Executive Officer since 1984.
Stuart Shikiar 50 Mr. Shikiar has been a director of the Company
since April 1991. Mr. Shikiar has been the
President of Shikiar Asset Management Inc. since
November 1994. From May 1993 to November 1994 Mr.
Shikiar was a General Partner at Omega Advisors.
From February 1985 to May 1993 Mr. Shikiar was a
Managing Director of Prudential Securities
Investment Management. Mr. Shikiar serves on the
Board of Bluegreen Corporation (formerly Patten
Corporation) and IGC.
Richard Hansen 56 Mr. Hansen has been a director since July 1993. Mr.
Hansen has been President and Chief Executive
Officer of Pennsylvania Merchant Group Ltd, an
investment banking and venture capital firm, since
1987 and is a director of Computone Corporation.
The Board of Directors has unanimously approved the above-named nominees
for directors. The Board of Directors recommends a vote FOR all of these
nominees.
BOARD OF DIRECTORS
The Board of Directors has met seven (7) times during the fiscal year
ended June 30, 1996. Messrs Abeles, Barrella, Jagid, Lieberman, Rosansky and
Shikiar attended all seven meetings; Mr. Rosner missed one meeting and Mr.
Hansen missed four meetings.
Each board member receives a $750 monthly retainer as well as $750 for
each board meeting attended. In addition, each director receives an option, at
the end of each calendar quarter to purchase 1,500 shares of Common Stock. This
option is granted to each director on the last day of the calendar quarter; it
vests immediately with a term of five years from the date of grant and is
granted at an exercise price equal to the closing price of the Common Stock on
the date of grant.
COMMITTEES OF THE BOARD
The Board has established two standing committees to assist it in carrying
out its responsibilities: the Compensation and Stock Option Committee and the
Audit Committee.
The members of the Compensation and Stock Option Committee are Joseph C.
Abeles, Carl H. Rosner and Arthur Lieberman. The Compensation and Stock Option
Committee has general responsibility for recommending to the Board remuneration
for the Chairman and Vice Chairman and determining the remuneration of other
officers elected by the Board; granting stock options and otherwise
administering the Company's stock option plans; and approval and administration
of any other compensation plans or agreements. This committee held one formal
meeting, acted by unanimous consent on several occasions and had informal
discussions from time to time during the fiscal year ended June 30, 1996.
3
The members of the Audit Committee are Joseph C. Abeles, Carl H. Rosner
and Stuart Shikiar. This committee has oversight responsibility for reviewing
the scope and results of the independent auditors' annual examination of the
Company's financial statements; meeting with the Company's financial management
and the independent auditors to review matters relating to internal accounting
controls, the Company's accounting practices and procedures and other matters
relating to the financial condition of the Company; and recommending to the
Board of Directors the appointment of the independent auditors. This committee
held one formal meeting as part of a regular board meeting and had informal
discussions from time to time during the fiscal year ended June 30, 1996.
PROPOSAL 2
RATIFICATION OF OPTIONS GRANTED TO
CHIEF EXECUTIVE OFFICER IN 1994
At the meeting there will be presented to the stockholders Proposal 2, a
proposal to approve and ratify an option granted in 1994 to the Company's Chief
Executive Officer, Bruce Jagid, to purchase a total of 150,000 shares of the
Company's Common Stock, pursuant to his Employment Agreement dated March 29,
1994.
Description of 1994 Plan. Pursuant to an Employment Agreement dated March
29, 1994 (the "1994 Employment Agreement"), Bruce Jagid was granted an option
(the "1994 Option") to acquire a total of 150,000 shares of the Company's Common
Stock at $11 per share until March 1, 2000. The right to purchase the shares
under the 1994 Option vests 30,000 shares on March 1 in each of 1995 through
1999. The 1994 Employment Agreement also provides that options under the 1994
Option Agreement and certain options previously granted to Mr. Jagid, will vest
on their vesting date and remain vested until their normal termination date
(March 1, 2000 in the case of the 1994 Option) even if Mr. Jagid is no longer
employed by the Company, provided that Mr. Jagid does not resign his employment
with the Company or is not terminated for cause prior to March 1, 1997.
The existence and the terms of the 1994 Employment Agreement and the 1994
Option were disclosed in the Company's Annual Report on Form 10-K and proxy
statements for 1994 and 1995, but were not submitted to the stockholders for
ratification at the 1994 stockholders meeting, or at the 1995 stockholders
meeting (at which a subsequent option (see description of "1995 Option below")
was approved by the stockholders of the Company).
In early 1996, the National Association of Securities Dealers, Inc.
("NASD") informed the Company that because the 1994 option was not ratified by
the stockholders of the Company and was not part of a plan which was so
ratified, to the extent that such option exceeded 25,000 shares it violated the
NASD's by-laws. As a result, the NASD stated that the Company's common shares
would be de-listed unless the matter was corrected.
In order to prevent de-listing of the Company's common stock, which would
have had a materially deleterious effect on the Company's stockholders, the
Company and Mr. Jagid entered in to an amendment dated March 26, 1996 (the "1996
Amendment"). Under the terms of the 1996 Amendment, it was agreed that only
25,000 shares covered by the 1994 Option were exercisable, unless the 1994
Option was ratified by the Company's stockholders at the 1996 annual meeting,
thus causing the 1994 Option to be in compliance with NASD by-laws. Under the
1996 Amendment, if ratified, options under the 1994 Option will vest as
originally provided. However, if the 1994 Option is not ratified, the 1996
Amendment requires the Company to compensate Mr. Jagid for his loss in a manner
as the parties mutually agree. If the parties fail to so agree, the manner and
amount of compensation will be submitted to binding arbitration before the
American Arbitration Association. Since such compensation may require the
Company to make cash payments to Mr. Jagid, the Board of Directors strongly
recommends a vote to ratify the 1994 option and thus avoid the Company having
such obligation.
4
Other Options held by Mr. Jagid. In addition to the 150,000 shares covered
by the 1994 Option, Mr. Jagid has options covering a total of 385,000 shares as
follows. Pursuant to an Option agreement dated October 24, 1992, Mr. Jagid has
options to purchase 12,500 shares at $4.00 per share which are currently
exercisable and options to purchase 225,000 shares at $9.75 per share of which
options to purchase 165,000 shares are currently exercisable and the remaining
60,000 become exercisable on June 30, 1997. As a director of the Company,
pursuant to the Company's 1992 Option Plan Mr. Jagid has received options to
purchase 1,500 shares at the end of each quarter, starting June 30, 1993 at the
closing price of the common stock on each grant date. Such options are
immediately exercisable and are for a term of five years. Such options were for
a total of 21,000 shares through September 30, 1996 at exercise prices ranging
from $8.75 up to $24.25, depending on the grant date. The average exercise price
of such options is approximately $15.40. Pursuant to the Company's 1995 Chief
Executive Officer Stock Option Plan (the "1995 Option"), which was approved by
the stockholders of the Company at the 1995 Annual Meeting, Mr. Jagid was
granted an option to purchase 100,000 shares of the Company's common stock at
$14.25 per share until March 1, 2001. Such option vests with respect to 20,000
shares on March 1 on each of 1996 through 2000. Under the terms of the 1995
Option, once the right to purchase a number of shares vests, it remains vested
until the options expiration on March 1, 2001, notwithstanding any subsequent
termination of Mr. Jagid's employment. On September 30, 1996 the closing price
for the Company's common stock was $11.625 per share.
As noted above, the 1994 Option was granted to Mr. Jagid by the Company in
connection with the 1994 Employment Agreement and was disclosed in all of the
Company's subsequent proxy statements and Annual Reports on Form 10-K. If the
1994 Option is ratified by the Company's stockholders, it will remain in effect
and options to purchase shares will vest as provided in such Option and
previously disclosed. However, if the Option is not ratified, the Company will
be obligated pursuant to the terms of the 1996 Amendment to compensate Mr. Jagid
for his loss of such option in an amount to be negotiated, and failing an
agreement between the Company and Mr. Jagid, subject to arbitration. Such
obligation may require the Company to make a cash payment to Mr. Jagid; the
amount of such potential payment cannot presently be determined. The Company
believes that the 1994 Option should be ratified so that the Company may honor
its commitment to Mr. Jagid as provided in the 1994 Option and so the Company
may avoid making a cash payment to, or providing Mr. Jagid with, other
compensation for the loss of the 1994 Option.
For these reasons, the Board of Directors recommends a vote "FOR" Proposal 2
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The table below sets forth certain information regarding the beneficial
ownership of shares of the Company's Common Stock as of September 15, 1996 by
(i) each person known by the Company to beneficially own more than five percent
of the outstanding shares of Common Stock, (ii) each director of the Company,
and (iii) all directors and officers of the Company as a group. Except as
otherwise indicated, the persons named in this table have sole voting power with
respect to all shares of Common Stock owned based upon information provided to
the Company by the directors, officers and principal stockholders and their
addresses are the address of the Company.
Number of Shares Percent
Name Beneficially Owned Beneficially Owned
---- ------------------ -------------------
Intermagnetics General
Corporation
450 Old Niskayuna Rd.
Latham, NY 12210-0461 (1) 997,586 12.55%
Joseph Abeles(2) 260,500 3.28%
Joseph Barrella(3) 288,500 3.60%
Bruce Jagid(4) 474,300 5.78%
Richard Hansen(5) 26,500 0.33%
Arthur Lieberman(6) 128,500 1.61%
Martin Rosansky(7) 138,500 1.74%
Carl Rosner(8) 997,586 12.55%
Stuart Shikiar(9) 106,000 1.33%
All directors and officers
as a group (14 persons)(10) (2,497,386 29.25%
5
(1) Includes 833 shares and options to purchase 21,000 shares which may be
exercised within 60 days beneficially owned by Mr. Carl H. Rosner. Mr.
Rosner is the Chairman, President and Chief Executive Officer of
Intermagnetics General Corporation ("IGC"). Therefore, IGC may be deemed
to share voting and investment power with respect to the shares and shares
issuable upon the exercise of options held by Mr. Rosner. IGC disclaims
beneficial ownership of the shares and shares issuable upon the exercise
of options owned by Mr. Rosner.
(2) Includes 21,000 shares subject to options which may be exercised within 60
days, 12,000 shares owned by Abeles Associates Inc. and 25,000 shares held
by Mr. Abeles' spouse, as to which Mr. Abeles disclaims beneficial
ownership. Excludes 975,753 shares beneficially owned by IGC. Mr. Abeles
is a director of lGC and therefore may be deemed to share voting and
investment power with respect to the shares held by IGC. Mr. Abeles
disclaims beneficial ownership of the shares owned by IGC.
(3) Includes 96,000 shares subject to options which may be exercised within 60
days.
(4) Includes 278,500 shares subject to options which may be exercised within
60 days, 125,000 of which are not exercisable, unless and until the grant
of such options is approved by the shareholders of the Company (See
Proposal 2 above). Includes 3,000 shares held in trust for Mr. Jagid's
children of which he disclaims beneficial ownership.
(5) Includes 19,500 shares subject to options which may be exercised within 60
days. Includes 2,000 shares owned by minor children of which Mr. Hansen
disclaims beneficial ownership. Does not include shares held by
Pennsylvania Merchant Group Ltd as a market-maker. Mr. Hansen is President
and Chief Executive Officer of Pennsylvania Merchant Group Ltd and
therefore may be deemed to share voting and investment power.
(6) Includes 41,000 shares subject to options which may be exercised within 60
days and 52,500 shares held by the Arthur M. Lieberman P.C. profit sharing
plan.
(7) Includes 46,000 shares subject to options which may be exercised within 60
days.
(8) Includes 19,500 options to purchase shares which may be exercised within
60 days and 975,753 shares owned by IGC. Mr. Rosner is the Chairman,
President and Chief Executive Officer of IGC and therefore may be deemed
to share voting and investment power with respect to the shares held by
IGC. Mr. Rosner disclaims beneficial ownership of the shares owned by IGC.
(9) Includes 21,000 shares subject to options which may be exercised within 60
days. Does not include 171,100 shares held in customer accounts over which
Mr. Shikiar has investment power, but for which he disclaims beneficial
ownership. Excludes 975,753 shares beneficially owned by IGC. Mr. Shikiar
is a director of IGC and therefore may be deemed to share voting and
investment power with respect to the shares held by Mr. Shikiar. Mr.
Shikiar disclaims beneficial ownership of the shares owned by IGC.
(10) Includes 597,000 shares subject to options which may be exercised within
60 days, 125,000 of which are not exercisable, unless and until the grant
of such options is approved by the stockholders of the Company.
Section 16(a) Reporting
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and executive officers, and persons who own
more than ten percent of the Company's Common Stock, to file with the Securities
and Exchange Commission (the "SEC") initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the Company.
Officers, directors and greater than ten-percent stockholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) reports
they file. To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company during the fiscal year ended June 30,
1996, all Section 16(a) filing requirements applicable to its officers,
directors and greater than ten percent beneficial owners were complied with,
except that Richard Hansen was late in filing two reports covering 12 related
transactions, Ian Irving, a former officer, was late in filing a report covering
one transaction, Bruce Jagid was late in filing a report covering one
transaction, Harold Kramer was late in filing his initial form 3, Stanley Lewin
was late in filing one report covering three transactions and Martin Rosansky
was late in filing one report covering four transactions.
EXECUTIVE COMPENSATION
The names of, and certain information with respect to the Company's
executive officers who are not also directors, are presented on the following
pages.
Name Age Present Principal Occupation and Employment History
Robert Cook 52 Mr. Cook has been the Company's Controller since
January 1992 and Chief Financial Officer since
October 1992. From October 1988 to January 1992,
Mr. Cook was Controller for Infodata Systems,
Inc., a computer software and consulting
company. Mr. Cook, a Certified Public
Accountant, worked as an independent consultant
from May 1987 to October 1988. From 1981 to 1987
Mr. Cook worked at Bausch & Lomb, Inc., serving
in various positions, including Area Financial
Manager, Manager of Financial Planning and
Analysis and Manager of Finance and
Administration. Mr. Cook has also served as
Controller for American Hospital Supply Corp.
from 1976 to 1981.
Stanley Lewin 64 Mr. Lewin has been the Company's Vice President
of Operations since October 1991. Mr. Lewin has
over 13 years experience in the lithium battery
business. Prior to joining the Company, Mr.
Lewin served in various engineering and
managerial positions at Power Conversions Inc.
("PCI") from 1977 to September 1991. At PCI he
was responsible for overall plant operations
including manufacturing and production. While at
PCI, Mr. Lewin was directly responsible for the
establishment of battery manufacturing
facilities in New Jersey, Puerto Rico and in the
People's Republic of China.
Daniel K. Schoenly 60 Mr. Schoenly has been the Company's Vice
President of Engineering and Vice President,
Manufacturing Primary Batteries since May 1994.
From January 1990 to May 1994, Mr. Schoenly was
the Vice President of Technical Materials, Inc.,
a subsidiary of Brush Wellman Inc. Prior
thereto, from 1982 to January 1990, Mr. Schoenly
held various positions at Brush Wellman Inc.
Both Brush Wellman Inc. and Technical Materials,
Inc. manufacture engineered materials.
James Sullivan 59 Mr. Sullivan has been the Company's Vice
President-Sales, since July 1996. From March
1995 through July 1996 he was President of C.C.
Communications, Inc., an advertising agency in
New Jersey, was in charge of market development
for Holt Lloyd International, a car care
products company in the UK. Prior to that from
November 1976 through November 1994, Mr.
Sullivan was Vice-President, in charge of sales
and with additional responsibilities for
engineering and product development of Power
Conversion, Inc., a manufacturer of lithium
batteries.
John Welsh 60 Mr. Welsh has been the Company's Vice President
of European Operations and Managing Director of
Ultralife Batteries (UK) Ltd since November
1995. Mr. Welsh has over 20 years experience of
managing companies in the UK, USA and Germany.
From August 1988 until January 1995 he was
Marketing and then Divisional Manager for
Hoppecke Batteries in Germany which developed
and manufactured high rate lithium manganese
dioxide batteries, and from February 1995 to
October 1995 he was Marketing Manager for
industrial nickel cadmium batteries at FRIWO
Silberkraft, also in Germany. Prior to joining
Hoppecke Mr. Welsh worked for 15 years for the
German company Semikron, a manufacturer of power
semi conductors. He was Managing Director of
Semikron UK from February 1972 until December
1980 and President of Semikron Inc. Hudson NH
until July 1987. Between August 1987 and July
1988 Mr. Welsh was a consultant.
Compensation Tables
The individuals named in the following tables include, as of June 30,
1996, the Company's Chief Executive Officer and the four other most highly
compensated executive officers of the Company ("Named Executive Officers").
Total salary and bonus of each other executive officer of the Company did not
exceed $100,000.
The following table sets forth information concerning the annual and
long-term compensation of the Named Executive Officers for all services in all
capacities to the Company and its subsidiary during the Company's fiscal years
ended June 30, 1996, 1995 and 1994.
Summary Compensation Table
Long Term Compensation
-------------------------
Annual Compensation Awards Payouts
----------------------------------------------------------------------
Other Securities
Name and Annual Restricted Underlying All Other
Principal Compen Stock Options/ LTIP Compen-
Position Year Salary($) Bonus($) sation($)(3) Awards ($) SARs(#) Payouts($) sation ($)
- --------- ---- --------- -------- ------------ ---------- ---------- ---------- ----------
Bruce Jagid 1996 $273,654 $ 0 $33,278 $0 6,000 $0 $0
Chief Executive 1995 208,076 111,200 35,545 0 106,000 0 0
Officer 1994 81,733 0 34,869 0 156,000 0 0
Joseph Barrella 1996 149,808 0 30,649 0 6,000 0 0
President and 1995 139,996 15,000 31,002 0 6,000 0 0
Chief 1994 134,803 0 34,017 0 6,000 0 0
Operating
Officer
Harold Kramer (1) 1996 125,001 0 11,299 0 0 0 0
Vice President of 1995 40,866 0 940 0 50,000 0 0
1994 0 0 0 0 0 0 0
Administration
and
Corporate
Planning
Stanley Lewin 1996 110,000 0 11,692 0 0 0 0
Vice President of 1995 101,539 0 13,854 0 0 0 0
Operations 1994 96,045 0 11,876 0 0 0 0
Ian Irving (2) 1996 103,316 0 14,099 0 0 0 0
Vice President 1995 96,200 15,000 13,398 0 0 0 0
of Marketing 1994 90,688 0 12,628 0 0 0 0
and Sales
(1) Hired February 27, 1995, terminated October 11, 1996
(2) Terminated employment July 12, 1996
(3) The amounts reported in this column are summarized on the following table:
Bruce Joseph Harold Stanley Ian
Jagid Barrella Kramer Lewin Irving
Insurance 1996 $ 6,499 $ 6,499 $ 6,499 $ 6,499 $ 6,499
Insurance 1995 10,267 7,656 0 8,872 8,598
Insurance 1994 8,340 7,093 0 7,625 7,828
Automobile 1996 11,029 8,400 4,800 5,193 7,600
Automobile 1995 11,028 9,096 940 4,982 4,800
Automobile 1994 12,279 15,674 0 4,251 4,800
Directors Fees 1996 15,750 15,750 0 0 0
Directors Fees 1995 14,250 14,250 0 0 0
Directors Fees 1994 14,250 11,250 0 0 0
The following table sets forth information concerning options granted to the
Named Executive Officers during the Company's fiscal year ended June 30, 1996
Option/SAR Grants in Last Fiscal Year
Potential
Realizable Value at Assumed Annual Rates of
Individual Grants Stock Price Appreciation for Option Term (1)
- ----------------------------------------------------------------------- --------------------------------------------
% of Total
Options\
Number SARs
Securities Granted
Underlying to Exercise
Options/ Employees or Base 0 % 5% 5% 10% 10%
SARs in Fiscal Price Expiration Stock Stock Dollar Stock Dollar
Name Granted(#) Year(6) ($/sh)(7) Date Price Price Gain(8) Price Gain(8)
- ---- ----------- --------- --------- ---------- ----- ----- ------- ----- -------
Bruce Jagid 1,500(2) 0.8% $24.50 Sep. 30, 2000 $24.50 $31.27 $10,155 $39.46 $22,440
Chief 1,500(3) 0.8% $24.00 Dec. 31, 2000 $24.00 $30.63 $9,945 $38.65 $21,975
Executive 1,500(4) 0.8% $14.75 Mar. 31, 2001 $14.75 $18.83 $6,120 $23.76 $13,515
Officer 1,500(5) 0.8% $14.25 Jun. 30, 2001 $14.25 $18.19 $5,910 $22.95 $13,050
Joseph 1,500(2) 0.8% $24.50 Sep. 30, 2000 $24.50 $31.27 $10,155 $39.46 $22,440
Barrella
President & 1,500(3) 0.8% $24.00 Dec. 31, 2000 $24.00 $30.63 $9,945 $38.65 $21,975
Chief 1,500(4) 0.8% $14.75 Mar. 31, 2001 $14.75 $18.83 $6,120 $23.76 $13,515
Operating 1,500(5) 0.8% $14.25 Jun. 30, 2001 $14.25 $18.19 $5,910 $22.95 $13,050
Officer
Harold Kramer 0 0% 0 ----- $0 $0 $0 $0 $0
Stanley Lewin 0 0% 0 ----- $0 $0 $0 $0 $0
Ian Irving 0 0% 0 ----- $0 $0 $0 $0 $0
(1) There is no assurance that the value realized by an employee will be at or
near the amount estimated using this model. These amounts rely on assumed
future stock price movements which cannot be predicted accurately.
(2) Vested on the date of grant, September 30, 1995.
(3) Vested on the date of grant, December 31, 1995.
(4) Vested on the date of grant, March 31, 1996.
(5) Vested on the date of grant, June 30, 1996.
(6) 190,000 total number of options were granted to employees.
(7) Fair market value at date of grant.
(8) Fair market value of stock at end of actual option term, assuming annual
compounding at the stated rate, less the option price.
The following table sets forth certain information concerning the number of
shares of Common Stock acquired upon the exercise of stock options during the
Company's fiscal year ended June 30, 1996 and the number and value at June 30,
1996 of unsecured stock options to purchase shares of Common Stock held by the
Named Executive Officers.
Aggregated Option/SAR Exercises in Last Fiscal Year
and FY-End Option/SAR Values
Value of
Shares Value Number Unexercised Unexercised in the Money
Acquired on Realized Options/SARs at FY-End (#) Options/SARs at FY-End ($)
Name Exercise(#) ($) Exercisable/Unexercisable Exercisable/Unexercisable(1)
---- ----------- -------- -------------------------- ----------------------------
Bruce Jagie 50,000 $537,500 278,500(2)/265,000 $929,375/$676,250
Joseph Barrella 52,500 $971,250 96,000/25,000 $315,000/$112,500
Harold Kramer 0 $0 10,000/40,000 $12,500/$50,000
Stanley Lewin 5,000 $80,000 26,000/29,000 $72,250/$29,000
Ian Irving 24,000 $258,000 0/36,000 $0/$55,000
(1) Market value of Company's common stock at exercise or year-end, minus the
exercise price.
(2) Includes options to purchase 60,000 shares in accordance with 1994
Employment Agreement. Of this amount, only options to purchase 25,000
shares are available, pending approval by the shareholders of Proposal 2.
The Company has no long-term incentive plan. Consequently, there have
been no qualifying awards during the fiscal year ended June 30, 1996. Also, the
Company has no employee pension plans to which it makes contributions.
Employment Arrangements
Effective March 1, 1994, the Company and Mr. Bruce Jagid entered into
an employment agreement ("1994 Agreement"). Under the terms of the 1994
Agreement, Mr. Jagid's base salary was $200,000 per year. By an amendment to Mr.
Jagid's 1994 Agreement, effective August 24, 1995 ("1995 Amendment"), Mr.
Jagid's base salary was increased to $250,000 per year, effective retroactively
to March 1, 1995. In accordance with the terms of the 1994 Agreement, the
Company paid to Mr. Jagid a bonus in the amount of $111,200 during the year
ended June 30, 1995. Effective March 1, 1996, Mr. Jagid's salary was increased
to $275,000 per year.
Pursuant to the 1994 Agreement, the Company granted to Mr. Jagid an
option to purchase 150,000 shares of Common Stock at a price of $11.00 per
share. This option expires on March 1, 2000 and will vest with respect to 30,000
shares on March 1, 1995, 1996, 1997, 1998 and 1999, provided that Mr. Jagid
remains an employee of the Company on each of such vesting date. Such options
will vest on each of such dates even if Mr. Jagid is no longer an employee of
the Company, unless prior to March 1, 1997: (i) the Company has terminated his
employment for cause or (ii) he has terminated his employment and such
termination is not as a result of a material breach of the terms of the
agreement.
As described in Proposal 2, the option to purchase 150,000 shares of
Common Stock granted to Mr. Jagid pursuant to the 1994 Agreement was not
ratified by the Company's stockholders, nor was it issued as part of an option
plan which was approved by the stockholders of the Company, as required by the
by-laws of the NASD Stock Market, Inc. In February, 1996, NASD informed the
Company that this will subject the Company to having its common stock de-listed
if this problem is not corrected. As a result, the Company and Mr. Jagid have
entered into an amendment to the 1994 Agreement ("1996 Amendment") wherein only
the option to purchase 25,000 common shares of the Company will vest and that
the balance of 125,000 shares will become exercisable only if and when the
option for the 150,000 shares are ratified and approved by the stockholders of
the Company. When the 1994 Agreement is ratified, all shares will vest and be
exercisable on the dates and under the terms of the 1994 Option, in accordance
with the terms thereof. If the Company's stockholders do not ratify the 1994
Option by approving Proposal 2 at the Company's Stockholders Meeting currently
scheduled for December, 1996, the Company will be required to compensate Mr.
Jagid for the loss incurred by him as a result of the loss of the 1996 Options
in such manner as both parties mutually agree. If Mr. Jagid and the Company are
unable to agree to the amount or manner of such compensations after negotiating
in good faith, the matter will be resolved by binding arbitration by the
American Arbitration Association.
10
As of March 1, 1995, the Company agreed, contingent on shareholder
approval, to grant Mr. Bruce Jagid an additional option to purchase 100,000
shares of Ultralife common stock at $14.25 per share. This option will vest in
20,000 share increments on March 1, 1996, 1997, 1998, 1999 and 2000 respectively
and will expire on March 1, 2001. Such options, once vested, will remain vested
until expiration, notwithstanding the subsequent termination of Mr. Jagid's
employment. Such stockholder approval was granted at the December 7, 1995 annual
stockholders' meeting.
The original term of Mr. Jagid's 1994 Agreement was three years
expiring on February 28, 1997, which term was extended by the 1995 Amendment by
three years, so as to terminate on February 28, 2000. Unless terminated for
cause, upon expiration of the agreement, Mr. Jagid will receive severance at the
rate of one month's salary for each year of employment with the Company, not to
exceed three months, prorated for partial years worked.
The Company has entered into an employment agreement dated January 18,
1991 with Mr. Joseph N. Barrella (the "Agreement"). The Agreement was amended as
of December 21, 1992 (the "Amendment"). The Agreement and the Amendment provide
that Mr. Barrella will serve as President, at an annual salary of $110,000 for
1991 and 1992, $125,000 for 1993, $135,000 for 1994, $145,000 for 1995 and
$155,000 for 1996. Subsequent to January 20, 1994, Mr. Barrella became an
"at-will" employee. The Agreement and Amendment provide that the Company will
provide to Mr. Barrella in addition to his compensation, (i) reimbursement for
an apartment in the Rochester, New York area to a maximum of $6,000 per year,
(ii) a leased automobile with a cost not to exceed $700 per month, and (iii)
granted Mr. Barrella an "incentive" Option to acquire 100,000 shares of Common
Stock of the Company under the Company's 1992 Stock Option Plan (discussed
below). The Company and Mr. Barrella have agreed that after December, 1996, Mr.
Barrella will no longer be reimbursed for an apartment in the Rochester, New
York area.
In addition to the above compensation, each board member receives a
$750.00 monthly retainer as well as $750.00 for each board meeting attended. In
addition, commencing June 30, 1993, each director receives an option, at the end
of each calendar quarter to purchase 1,500 shares of the Company's common stock.
This option is granted to each director on the last day of the calendar quarter;
it vests immediately with a term of five years from the date of grant and is
granted at a purchase price equal to the closing price of the Common Stock on
the date of grant.
DESCRIPTION OF OPTION PLANS AND NON-PLAN OPTIONS
1991, 1992 and 1995 Stock Option Plans. The Company has three stock
option plans and a number of options granted not pursuant to any plan. The
plans, include the Company's 1991 Stock Option Plan ("1991 Plan") the Company's
1992 Stock Option Plan (the "1992 Plan") and the Company's 1995 Chief Executive
Officer Stock Option Plan (the "1995 Plan"). The 1991 and 1992 Plans expire in
2001 and 2002 respectively, and currently cover a maximum of 100,000 and
1,150,000 shares respectively. The 1991 and 1992 Plans are administered by the
Compensation and Stock Option Committee (the "Committee") which consists of
Arthur Lieberman, Carl H. Rosner and Joseph C. Abeles. Subject to the express
provisions of the 1991 and 1992 Plans, the Committee has the authority to
interpret the Plans, to prescribe, amend, and rescind rules and regulations
relating to the Plan, to determine the terms and provisions of stock agreements
thereunder and to make all other determinations necessary or advisable for the
administration of the Plan.
Key employees and consultants of the Company (including employees and
consultants who are also directors of the Company) are eligible to receive
options under the 1991 and 1992 Plans. Key employees are eligible to receive
incentive stock options ("ISOs") under the 1992 Plan, and non-qualified stock
options ("NQSOs") under the 1991 and 1992 Plans. Consultants are eligible to
receive only NQSOs under either Plan. The 1991 and 1992 Plans confers discretion
on the Committee to select key employees and consultants to receive options. The
Committee determines the exercise price of the option granted, except that the
exercise price may not be less than 100% of the fair market value of the shares
for an ISO under the 1992 Plan, or 85% of the fair market value of the shares
for a NQSO, on the date of grant.
The Committee determines the term of the option, except that no option may
have a term of more than ten years. No ISO granted to a Control Person may have
a term of more than five years. The Committee also determines whether an option
is exercisable in installments and whether the exercise price may be paid in
Common Stock, including Common Stock acquired pursuant to the option being
exercised.
The 1992 Plan provides for an automatic grant on the last day of each
calendar quarter starting on June 30, 1993, to each director on such grant date,
of a five-year NQSO to purchase 1,500 shares of Common Stock at an exercise
price equal to the closing price of the stock on the date of grant.
11
Options granted to key employees, consultants and directors may be
exercised, prior to termination of employment in the case of the 1991 Plan, and
under the 1992 Plan within 90 days following the termination of an employee's
employment or a consultant's consulting relationship with the Company or a
director's term of office with the Company (unless the director continues to be
an employee or consultant of the Company). The Committee shall have the
discretion to provide that upon termination of an employee's employment or a
consultant's consulting relationship as a result of retirement, disability or
death, such grantee or his or her legal representative may exercise any
outstanding and then exercisable installments of his or her options for a period
not to exceed: (i) one year from the date of such termination in the case of
death or permanent and total disability, and (ii) three months from the date of
such termination in the case of retirement or other disability. In no event are
options exercisable beyond their stated terms.
All options granted under the 1991 and 1992 Plans become exercisable upon
a "change in control" as defined in the 1991 and 1992 Plans. The 1992 Plan
provides that in the event of changes in corporate structure which in the
judgment of the Committee materially affect the value of shares, the Committee
may determine the appropriate adjustment to the number and class of shares and
the exercise price per share for any outstanding option.
As of June 30, 1996, NQSOs to purchase an aggregate of 90,500 shares of
Common Stock had been granted under the 1991 Plan, all at an exercise price of
$4.00 per share. During the fiscal year ended June 30, 1996, no options were
granted and options to purchase 62,100 were exercised and options to purchase
750 shares were canceled under the 1991 Plan. Of the total options exercised, M.
J. Barrella exercised options for 52,500 shares. At present the Company does not
intend to grant any further options under the 1991 Plan.
As of June 30, 1996, options to purchase an aggregate of 851,000 shares of
Common Stock had been granted under the 1992 Plan at exercise prices ranging
from $6.38 to $24.50 per share. Of such amounts, during the fiscal year ended
June 30, 1996, options to purchase 190,000 shares have been granted at prices
ranging from $13.19 to $24.50 per share, options to purchase 101,700 shares have
been exercised at prices ranging from $8.00 to $17.25 per share and options to
purchase 36,000 shares have been canceled. During the fiscal year ended June 30,
1996, Mr. Rosansky exercised options to purchase 50,000 shares at $8.00 per
share and Mr. Irving exercised options to purchase a total of 24,000 shares at
$8.00 per share.
The Company granted to each of Mr. Barrella, Mr. Jagid, the Company's
Chief Executive Officer, and Mr. Rosansky, the Company's Vice Chairman, options
under the 1992 Plan to purchase 1,500 shares during the fiscal year ended June
30, 1993 and 6,000 shares during the fiscal years ended June 30, 1996, 1995 and
1994, respectively, as a director of the Company. During the fiscal year ended
June 30, 1993, the Company granted to Mr. Rosansky options under the 1992 Plan
to purchase 100,000 shares of Common Stock at an exercise price of $8.00 per
share, which options vest at a rate of 25,000 shares on February 17 of 1994,
1995, 1996 and 1997.
Pursuant to the 1995 Plan, which was adopted by the Stockholders of
the Company, at the 1995 Annual meeting of Stockholders, Bruce Jagid was granted
an option to purchase 100,000 shares of the Company's Common Stock at $14.25 per
share. These options vest at a rate of 20,000 shares on March 1, 1996, 1997,
1998 1999 and 2000. Under the terms of the 1995 Option, once the right to
purchase a number of shares vests, it remains vested until the options
expiration on March 1, 2001, notwithstanding any subsequent termination of Mr.
Jagid's employment. None of these options have been canceled or exercised.
Non-plan options. As of June 30, 1994, options to purchase an aggregate of
447,500 shares of Common Stock were outstanding under various arrangements other
than the 1991 Plan, the 1992 Plan or the 1995 Plan ("non-plan options"). No
non-plan options to purchase shares were issued or canceled during the fiscal
year ended June 30, 1996. Non-plan options to purchase 55,000 shares were
exercised, at a price of $4.00 per share during the fiscal year ended June 30,
1996. Mr. Lewin exercised a non-plan option to purchase 5,000 shares and Mr.
Jagid exercised a non-plan option to purchase 50,000 shares during the fiscal
year ended June 30, 1996. During the fiscal year ended June 30, 1993, Mr. Jagid
was granted non-plan options to purchase 300,000 shares of Common Stock, of
which 75,000 are at an exercise price of $4.00 per share which vest over two
years and 225,000 are at an exercise price of $9.75 per share which vest over
five years. During the fiscal year ended June 30, 1994, Mr. Jagid was granted
non-plan options to purchase 150,000 shares of Common Stock ("the 1994 Option")
at an exercise price of $11.00 per share which vest over five years. However,
pursuant to the 1996 Amendment, only 25,000 shares will vest unless the 1994
option is ratified by Proposal 2 described above. During the fiscal year ended
June 30, 1994, Mr. Rosansky exercised non-plan options to purchase 37,500 shares
at an exercise price of $4.00 per share which were granted during the fiscal
year ended June 30, 1991. See "Employment Arrangements" for further details
regarding the options granted to Messrs. Jagid and Rosansky.
12
401(k) Plan
The Company established a profit sharing plan under Sections 401(a) and
401(k) of the Code (the "401(k) Plan"), effective as of June 1, 1992 which was
amended effective as of January 1, 1994. All employees in active service which
have completed six consecutive months of service or were participating in the
401(k) Plan as of January 1, 1994, not otherwise covered by a collective
bargaining agreement (unless such agreement expressly provides that those
employees are to be included in the 401(k) Plan), are eligible to participate in
the 401(k) Plan. Eligible employees may direct that a portion of their
compensation, up to a maximum of 20% be withheld by the Company and contributed
to their account under the 401(k) Plan. The 401(k) Plan permits, but does not
require, additional contributions for non-highly compensated employees to the
401(k) Plan by the Company. The Company has not made any such contributions
through the fiscal year ended June 30, 1996. In April, 1996 the Board of
Directors authorized a Company matching contribution up to a maximum of 1 1/2%
of an employee's annual salary for the calendar year ended December 31, 1996 and
3% for subsequent calendar years. All 401(k) contributions are placed in a trust
fund to be invested at the trustee's discretion, except that the Company may
designate that the funds be placed and held in specific investment accounts
managed by an investment manager other than the trustee. Amounts contributed to
employee accounts by the Company or as compensation reduction payments, and any
earnings or interest accrued on employee accounts, are not subject to federal
income tax until distributed to the employee, and may not be withdrawn (absent
financial hardship) until death, retirement or termination of employment.
REPORT OF COMPENSATION AND STOCK OPTION COMMITTEE
CONCERNING EXECUTIVE COMPENSATION
Overview
Compensation determinations are made by the Company's Compensation and
Stock Option Committee. The Company seeks to provide executive compensation that
will support the achievement of the Company's financial goals while attracting
and retaining talented executives and rewarding superior performance.
The Company seeks to provide an overall level of compensation to the
Company's executives that is competitive within the Company's industry and with
other companies of comparable size and complexity. Compensation in any
particular case may vary from the industry average on the basis of annual and
long-term Company performance as well as individual performance. The
Compensation and Stock Option Committee will exercise its discretion to set
compensation where, in its judgment, external, internal or individual
circumstances warrant it.
In general, the Company compensates its executive officers through a
combination of salary and stock option awards. Additionally, the Company's
executives are eligible to participate in or receive benefits under an employee
benefit plan made available by the Company to its executives and/or employees.
Salary
Of the primary elements of executive compensation set forth above,
salary is the least affected by the Company's performance; although it is very
much dependent on individual performance. The Company believes that salaries
paid to its executives are competitive with industry norms. The salary levels
and annual increases of all executive officers of the Company must be approved
by the Compensation and Stock Option Committee. Salary levels for executives are
determined by progress made in the operational and functional areas for which
they are responsible as well as the overall profitability of the Company.
Executives' salaries are reviewed annually. The timing and amount of
any increase to executives are both dependent upon (i) the performance of the
individual and, to a lesser extent, (ii) the financial performance of the
Company.
13
Stock Options
Stock options are designed to provide long-term incentives and rewards,
tied to the price of the Company's Common Stock. Given the vagaries of the stock
market, stock price performance and financial performance are not always
consistent. The Compensation and Stock Option Committee believes that stock
options, which provide value to the participants only when the Company's
stockholders benefit from stock price appreciation, are an appropriate
complement to the Company's overall compensation policies. Plan as well as
non-plan awards are made to executive officers of the Company. The decision to
award stock options to an executive is based upon such considerations as the
executive's position with the Company and is designed to be competitive for
individuals at that level. The Compensation and Stock Option Committee
administers the Company's stock option plans and awards plan and non-plan stock
options to executives of the Company.
Employee Benefit Plans
Executives of the Company are each entitled to participate in or
receive benefits under any pension plan, profit-sharing plan, life insurance
plan, health insurance plan or other employee benefit plan made available by the
Company to its executives and employees. Currently, the Company provides medical
insurance for its executive officers and has established the 401(k) Plan. All
executive officers and employees are eligible to participate in the 401(k) Plan.
Chief Executive Officer
In reviewing the performance of the Chief Executive Officer, the
Compensation and Stock Option Committee considers the scope and complexity of
his job during the past year, progress made in planning for the future
development and growth and return on assets of the Company. Upon review of such
criteria and upon the favorable recommendation of the Compensation and Stock
Option Committee, Mr. Jagid's salary has been increased to $275,000 effective
March 1, 1996.
Compensation and Stock Option Committee
Joseph C. Abeles
Carl H. Rosner
Arthur Lieberman
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Company's Compensation and Stock Option Committee,
consisting of Messrs. Abeles, Rosner and Lieberman, deliberate on issues
concerning executive compensation. Mr. Abeles is employed by the Company as its
Treasurer. Mr. Abeles is a director of IGC and a member of IGC's Compensation
Committee. Mr. Rosner is the Chairman, President and Chief Executive Officer of
IGC and is a member of the Company's Compensation and Stock Option Committee.
PERFORMANCE GRAPH
The following graph compares the cumulative return to holders of the
Company's Common Stock for the period commencing December 23, 1992 (the date of
the Company's initial public offering) through the fiscal year ended June 30,
1996 with the Nasdaq National Market Index and the Nasdaq Electrical Components
Index for the same period. The comparison assumes $100 was invested on December
23, 1992 in the Company's Common Stock and in each of the comparison groups, and
assumes reinvestment of dividends. The Company paid no dividends during the
comparison period.
300|------------------------------------------------------------------|
| # |
| |
275|------------------------------------------------------------------|
| # * |
| |
250|------------------------------------------------------------------|
| # |
D | |
O 225|------------------------------------------------------------------|
L | |
L | |
A 200|------------------------------------------------------------------|
R | & |
S | * |
175|------------------------------------------------------------------|
| * & |
| & |
150|-------------------------------------#----------------------------|
| # * * |
| # |
125|------------------------------------------------------------------|
| # *& & |
| & & |
100|-*&#--------------------------------------------------------------|
| * |
| |
75|--|-------|--------|--------|--------|--------|-------|--------|--|
12/ 6/ 12/ 6/ 12/ 6/ 12/ 6/
23/ 30/ 31/ 30/ 31/ 30/ 31/ 28/
92 93 93 94 94 95 95 96
*=Ultralife Batteries &=NASDAQ US #=Electrical Components
[GRAPHIC OMITTED]
OTHER MATTERS
The Board of Directors does not intend to present, and has not been
informed that any other person intends to present, any matters for action at the
Meeting other than those specifically referred to in this proxy statement. If
any other matters properly come before the Meeting, it is intended that the
holders of the proxies will act in respect thereof in accordance with their best
judgment.
In order to be eligible for inclusion in the Company's proxy materials
for the next year's annual meeting of stockholders, any stockholder proposal
(other than the submission of nominees for directors) must be received by the
Company at its principal offices not later than the close of business on July
18, 1997.
A representative of Arthur Andersen LLP, the Company's principal
accountant, plans to be present at the Meeting, will have the opportunity to
make a statement, and is expected to be available to respond to questions.
Copies of the Company's Annual Report and form 10-K for the year ended
June 30, 1996, as filed with the SEC, will be furnished without charge to
beneficial stockholders or stockholders of record on October 1, 1996, upon
request. Please contact: Corporate Secretary, Ultralife Batteries, Inc., 1350
Route 88 South, Post Office Box 622, Newark, New
York, 14513, Telephone (315) 332-7100.
October 31, 1996 By Order of the Board of Directors
Bruce Jagid
Chairman of the Board of Directors
and Chief Executive Officer
FACE OF PROXY CARD
PROXY
ULTRALIFE BATTERIES, INC. - Annual Meeting of Stockholders - December 5, 1996
Proxy Solicited on Behalf of the Board of Directors
The undersigned hereby appoints each of Bruce Jagid and Joseph Barrella
as the undersign's proxy, with full power of substitution, to vote all the
undersign's shares of common stock in Ultralife Batteries, Inc. (the
"Company") at the Annual Meeting of Stockholders of the Company to be held on
December 5, 1996 at 10:00 A.M. local time, at the offices of Chase Manhattan
Bank, 410 Park Avenue, New York, New York, or at any adjournment, on the matters
described in the Notice of Annual Meeting and Proxy Statement and upon such
other business as may properly come before such meeting or any adjournments
thereof, hereby revoking any proxies heretofore given.
PROPOSAL 1. ELECTION OF DIRECTORS
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
to vote for all or the following nominees:_____________________________________
Nominees: Bruce Jagid, Joseph Abeles, Joseph Barrella, Richard Hansen,
Arthur Lieberman, Martin Rosansky, Carl H.Rosner, Stuart Shikiar
PROPOSAL 2. RATIFY OPTIONS PREVIOUSLY GRANTED TO THE CHIEF EXECUTIVE OFFICER.
/ / FOR / / AGAINST / / ABSTAIN
(continued and to be signed on reverse side)
REVERSE OF PROXY CARD
Each properly executed proxy will be voted in accordance with
specifications made on the reverse side hereof. If no specifications are made,
the shares represented by this proxy will be voted FOR the listed nominees and
FOR Proposal 2.
Dated: , 1996
------------------------
--------------------------------------
Signature
--------------------------------------
Signature If Held Jointly
Sign exactly as set forth herein. If
signed as executor, administrator,
trustee or guardian, indicate the
capacity in which you are acting.
Proxies by corporations should be
signed by duly authorized officer and
bear corporate seal.
Please Sign and Return the Proxy Card Promptly in Enclosed Envelope
