INTERNET--(esecurities.W)--May 24, 1999 - The Smoking Gun?
Why no DEF 14/A was filed and why TMSRs annual meeting
was not held May 21, 1999?
UNITED STATES SEC FORM 10-K 405/A FILED 5/17/99
NOTE 9 -- STOCK OPTION PLANS AND WARRANTS
The Company has adopted a stock option plan for employees and
directors (the "1998 Stock Option Plan"). The Company has reserved 1,000,000
shares for issuance under the 1998 Stock Option Plan. The plan provides for
incentive stock options and nonqualified options to be granted. The Company
previously made grants under the 1994 Stock Option Plan, the 1994 Directors'
Stock Option Plan, and a nonqualified plan adopted in 1990 in which 1,200,000
shares had been reserved. In May 1998, any ungranted options and any future
forfeitures under the 1994 and 1990 option plans were transferred to the 1998
Stock Option Plan.
The stock option plans generally require the price of options to be
at the estimated fair market value of the stock at the date of grant. Options
have a maximum duration of ten years (five years under certain circumstances)
and may be exercised in varying amounts over the vesting periods. During
1998, the Board of Directors approved a stock option repricing for all
executives and employees of the Company. The repricing was effective as of
October 1, 1998...
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
DIRECTORS AND EXECUTIVE OFFICERS
Certain information with respect to the directors and executive
officers of the Company is set forth below. The Board of Directors is composed
of eight members who are divided into three classes, designated Class A, Class B
and Class C. Each class consists, as nearly as possible, of one-third of the
total number of directors constituting the entire Board of Directors. Each class
of directors is elected for a three-year term or until their successors are duly
elected. All executive officers are elected by the Board of Directors and serve
until their successors are duly elected by the Board of Directors.
NAME AGE POSITION WITH THE COMPANY
---- --- -------------------------
C. Norman Winningstad 73 Chairman of the Board (Class B director with term expiring
in 1999)
Frank G. Hausmann 41 President, Chief Executive Officer and Director (Class A
director with term expiring in 2001)
Robert L. Carter 56 Director (Class A director with term expiring in 2001)
Graham E. Dorland 57 Director (Class C director with term expiring in 2000)
General Merrill A. McPeak 63 Director (Class B director with term expiring in 1999)
G. Gerald Pratt 71 Director (Class A director with term expiring in 2001)
Milton R. Smith 63 Director (Class A director with term expiring in 2001)
Frederick M. Stevens 62 Vice Chairman of the Board (Class C director with term
expiring in 2000)
David K. Bergeson 40 Vice President, Sales
Frank M. Bouton 54 Vice President, New Technologies
G. Edward Brightman 41 Vice President, Operations
Ronald J. Resnick 50 Vice President, Marketing
FRANK G. HAUSMANN became a member of the Board of Directors in October
1998. He has been employed by the Company since July 1998, serving as President
and Chief Executive Officer since October 1998 and Vice President, Finance and
Administration and Chief Financial Officer prior to that time. From August 1997
to May 1998, Mr. Hausmann was Vice President, Finance and Chief Financial
Officer of Atlan Telecom, Inc., a developer of enhanced facsimile and voice-mail
solutions. From September 1995 to July 1997, he served as Vice President,
Corporate Development and General
39
Counsel of Diamond Multimedia Systems, Inc., a designer and marketer of
computer peripherals such as modems and graphics and sound cards. From June
1993 to September 1995, Mr. Hausmann was Executive Vice President and Chief
Financial Officer for Supra Corporation, a designer and marketer of modems
that was acquired by Diamond Multimedia Systems, Inc. in September 1995. Mr.
Hausmann received B.S. degrees in economics and political science from
Willamette University and a J.D. degree from the University of Oregon. He is
a member of the Oregon State Bar...
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth the compensation paid by the Company
during 1996, 1997 and 1998 to the Company's Chief Executive Officer, the other
four most highly compensated executive officers of the Company who were serving
as executive officers as of December 31, 1998 and the Company's former President
and Chief Executive Officer, Stephen A. Aanderud, whose employment with the
Company terminated during 1998 (collectively, the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
ANNUAL COMPENSATION SECURITIES ALL OTHER
---------------------- UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS (1) OPTIONS (2) (3)
--------------------------- ---- ------ --------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Frank G. Hausmann (4) 1998 $ 82,150 $ 25,000 190,000(5) --
PRESIDENT AND CEO
Stephen A. Aanderud (6) 1998 135,958 -- 88,700(7) $64,362(8)
FORMER PRESIDENT AND CEO 1997 155,000 69,168 45,450 3,304
1996 135,000 65,299 25,750 2,250
Ronald J. Resnick (9) 1998 142,000 -- 23,500(7) 2,130
VICE PRESIDENT, 1997 130,000 42,088 9,270 1,073
MARKETING 1996 78,692 28,172 41,020 --
David K. Bergeson (10) 1998 142,000 -- 23,500(7) 1,509
VICE PRESIDENT, SALES 1997 87,823 33,593 40,000 --
G. Edward Brightman 1998 125,000 -- 23,500(7) 1,016
VICE PRESIDENT, 1997 110,000 35,228 9,270 968
OPERATIONS 1996 90,000 32,445 18,540 988
Frank Bouton 1998 110,000 -- 13,500 1,031
VICE PRESIDENT, 1997 100,000 38,460 9,270 989
NEW TECHNOLOGIES 1996 85,000 36,770 16,480 970
</TABLE>
----------------
(1) Cash bonuses are paid to executive officers of the Company based upon
their individual contributions to the Company and the Company's overall
performance. Bonuses for a given year are paid in the first quarter of the
following year.
(2) The number of shares reflects a 3% stock dividend declared by the Board of
Directors on January 21, 1997.
(3) Unless otherwise noted, consists solely of the Company's matching
contributions under its 401(k) plan.
(4) Mr. Hausmann joined the Company in July 1998 as Vice President, Finance
and Administration and Chief Financial Officer. He was appointed President
and Chief Executive Officer in October 1998.
(5) Includes 80,000 replacement options granted upon surrender of options
previously granted. Surrendered options had an exercise price of $7.00
per share.
(6) Mr. Aanderud served as the Company's President and Chief Executive Officer
until October 1998.
(7) Represents replacement options granted upon surrender of options
previously granted. Surrendered options had exercise prices ranging from
$11.50 to $12.375 per share.
(8) Consists of $2,745 of the Company's matching contributions under its
401(k) plan and $61,617 in severance and accrued vacation time payments.
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<PAGE>
(9) Mr. Resnick joined the Company in May 1996.
(10) Mr. Bergeson joined the Company in May 1997.
OPTION GRANTS
The following table sets forth information with respect to grants of
stock options to the Named Executive Officers during 1998.
OPTION GRANTS IN 1998
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
NUMBER OF PERCENT OF VALUE AT ASSUMED ANNUAL
SHARES TOTAL RATES OF STOCK PRICE
UNDERLYING OPTIONS EXERCISE APPRECIATION FOR OPTION
OPTIONS GRANTED TO PRICE PER TERM (3)
GRANTED EMPLOYEES SHARE EXPIRATION -------------------------
NAME (1) IN YEAR (2) DATE 5% 10%
------------------------ ----------- --------- --------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Frank G. Hausmann 80,000(4) 9.7% $3.50 10/01/08 $ 176,000 $ 446,248
110,000 13.4 2.75 10/12/08 190,241 482,107
Stephen A. Aanderud(5) 88,700(4) 10.8 3.50 10/09/99 195,240 494,777
Ronald J. Resnick 13,500(4) 1.6 3.50 10/01/08 29,715 75,304
10,000 1.2 3.00 12/01/08 18,857 47,612
David K. Bergeson 13,500(4) 1.6 3.50 10/01/08 29,715 75,304
10,000 1.2 3.00 12/01/08 18,857 47,612
G. Edward Brightman 13,500(4) 1.6 3.50 10/01/08 29,715 75,304
10,000 1.2 3.00 12/01/08 18,857 47,612
Frank M. Bouton 9,450 1.2 12.375 02/02/08 73,545 186,378
4,050 .5 11.50 05/21/08 29,291 74,229
</TABLE>
-----------------------------
(1) Options may terminate before their expiration dates if the optionee's
status as an employee or director is terminated. One-fourth of the
shares of Common Stock covered by each such option vests and becomes
exercisable on each of the first four anniversaries of the grant date.
(2) Based on the closing prices of the Common Stock as reported on The
Nasdaq National Market on the respective grant dates.
(3) This column shows the hypothetical gains or option spreads of the
options granted based on assumed annual compound stock appreciation
rates of 5% and 10% over the full 10-year term of the options. The
assumed rates of appreciation are mandated by the rules of the
Securities and Exchange Commission and do not represent the Company's
estimate or projection of future Common Stock prices.
(4) Replacement options granted upon surrender of options previously
granted. Surrendered options had exercise prices ranging from $7.00 to
$12.375 per share.
(5) Upon termination of Mr. Aanderud's employment with the Company, all of
his options vested and are exerciseable through October 9, 1999.
44
<PAGE>
AGGREGATE OPTION EXERCISES AND YEAR-END OPTION VALUES
The following table sets forth certain information regarding exercises
of stock options during 1998 by the Named Executive Officers and the year-end
value of options held by such individuals.
AGGREGATE OPTION EXERCISES IN 1998 AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SHARES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS AT IN-THE-MONEY OPTIONS AT
ACQUIRED DECEMBER 31, 1998 DECEMBER 31, 1998(1)
ON VALUE --------------------------- ---------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
--------------------- -------- ---------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Frank G. Hausmann -- $ -- -- 190,000 $ -- $2,457,500
Stephen A. Aanderud 169,180 894,760 3,400 -- 42,500 --
Ronald J. Resnick -- -- 22,917 51,053 241,708 574,687
David K. Bergeson -- -- 10,000 53,500 72,500 516,250
G. Edward Brightman -- -- 64,267 39,723 940,548 452,032
Frank M. Bouton -- -- 10,557 28,693 106,823 193,534
</TABLE>
---------------------------------
(1) Calculated based on the difference between the option exercise price and
the closing price of the Common Stock on December 31, 1998 as reported on
The Nasdaq National Market ($16.00 per share). The potential values have
not been, and may never be, realized. The underlying options have not
been, and may never be, exercised. Actual gains, if any, on exercise will
depend on the value of the Common Stock on the date of exercise.
45
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding
beneficial ownership, as of April 30, 1999, unless otherwise indicated, of
the Company's Common Stock by (i) each shareholder known by the Company to be
the beneficial owner of more than 5% of the outstanding Common Stock, (ii)
each director of the Company, (iii) each of the Named Executive Officers and
(iv) all directors and executive officers as a group. Except as otherwise
indicated, the Company believes that the beneficial owners of the Shares of
Common Stock listed below, based on information furnished by such owners,
have sole investment and voting power with respect to such shares.
<TABLE>
<CAPTION>
SHARES PERCENT
NAME AND ADDRESS BENEFICIALLY BENEFICIALLY
OF BENEFICIAL OWNER (1) OWNED (2) OWNED (2)
---------------------------------------------- ------------- ------------
<S> <C> <C>
C. Norman Winningstad (3) 483,220 9.9
Sawtooth Capital Management, L.P. (4) 448,400 9.2
G. Gerald Pratt (5) 416,108 8.5
Robert A. Simms, Sr. (6)
55 Railroad Ave.
Greenwich, CT 06830 319,850 6.6
Milton R. Smith (7) 271,492 5.5
Robert L. Carter (8) 248,685 5.1
G. Edward Brightman (9) 75,004 1.5
Frank Bouton (10) 38,523 *
Graham E. Dorland (11) 35,290 *
Ronald J. Resnick (12) 30,535 *
Frederick M. Stevens (13) 24,308 *
David K. Bergeson (14) 20,000 *
General Merrill A. McPeak (15) 12,360 *
Stephen A. Aanderud 0 *
Frank G. Hausmann (16) 0 *
All Executive Officers and
Directors as a group (12 persons) (17) 1,655,525 32.0
</TABLE>
46
<PAGE>
--------------------------------
* Less than 1%
(1) Unless otherwise indicated, the address of each beneficial owner
identified is c/o ThrustMaster, Inc., 7175 NW Evergreen Parkway #400,
Hillsboro, Oregon 97124.
(2) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. For purposes of this table, a person
is deemed to be the beneficial owner of securities that (i) can be
acquired by such person within 60 days after April 30, 1999 upon the
exercise of options or warrants and (ii) are held by such person's spouse
or other immediate family member sharing such person's household. Each
beneficial owner's percentage ownership set forth above is determined by
assuming that options and warrants that are held by such person (but not
those held by any other person) and that are exercisable or convertible
within 60 days after April 30, 1999 have been exercised or converted.
(3) Includes 64,010 shares beneficially owned with spouse and 19,570 shares
subject to options exercisable within 60 days after April 30, 1999.
Excludes 10,150 shares subject to options exercisable more than 60 days
after April 30, 1999.
(4) Includes 250,480 shares beneficially owned by with Sawtooth Partners,
L.P. Sawtooth Capital Management, L.P. is a registered investment
advisor whose clients, including Sawtooth Partners, L.P., have the
right to receive or the power to direct the receipt of dividends from,
or the proceeds from the sale of, shares of Common Stock. No person,
other than Sawtooth Partners, L.P., holds more than five percent of
the shares. Sawtooth Capital Management, L.P. is the sole general
partner of Sawtooth Partners, L.P. Sawtooth Capital Management, Inc.
is the sole general partner of Sawtooth Capitol Management, L.P., and
Bartley B. Blout is the controlling shareholder of Sawtooth Capital
Management, Inc. The address for all of these persons is 100 Wilshire
Blvd., 15th Floor, Santa Monica, CA 90401. This information is based on
a Schedule 13G filed March 22, 1999.
(5) Includes 16,480 shares subject to options exercisable within 60 days
after April 30, 1999. Excludes 13,240 shares subject to options
exercisable more than 60 days after April 30, 1999.
(6) Share ownership based on a Schedule 13D/A filed April 23, 1999.
Includes 98,450 shares beneficially owned with Simms Capital
Management, Inc.
(7) Includes 69,010 shares subject to options exercisable within 60 days
after April 30, 1999. Excludes 10,150 shares subject to options
exercisable more than 60 days after April 30, 1999.
(8) Excludes 10,150 shares subject to options exercisable more than 60 days
after April 30, 1999.
(9) Includes 71,220 shares subject to options exercisable within 60 days
after April 30, 1999. Excludes 32,770 shares subject to options
exercisable more than 60 days after April 30, 1999.
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<PAGE>
(10) Includes 18,154 shares beneficially owned with spouse and 20,369 shares
subject to options exercisable within 60 days after April 30, 1999.
Excludes 18,881 shares subject to options exercisable more than 60 days
after April 30, 1999.
(11) Includes 2,480 shares beneficially owned with spouse and 19,570 shares
subject to options exercisable within 60 days after April 30, 1999.
Excludes 10,150 shares subject to options exercisable more than 60 days
after April 30, 1999.
(12) Includes 30,535 shares subject to options exercisable within 60 days
after April 30, 1999. Excludes 38,435 shares subject to options
exercisable more than 60 days after April 30, 1999.
(13) Includes 4,738 shares beneficially owned with spouse and 19,570 shares
subject to options exercisable within 60 days after April 30, 1999.
Excludes 10,150 shares subject to options exercisable more than 60 days
after April 30, 1999.
(14) Includes 20,000 shares subject to options exercisable within 60 days
after April 30, 1999. Excludes 43,500 shares subject to options
exercisable more than 60 days after April 30, 1999.
(15) Includes 12,360 shares subject to options exercisable within 60 days
after April 30, 1999. Excludes 13,240 shares subject to options
exercisable more than 60 days after April 30, 1999.
(16) Excludes 190,000 shares subject to options exercisable more than 60 days
after April 30, 1999...
* SOURCE: © 1999 Message 9572114
Note: The October 1-10, 1998 "OPTION ISSUANCE"
Date [1998 Stock Option Awards approved/issued]
was not only in the year extensive shareholder value
destruction occured but also contemporaneous with
allegations* of State, Federal, SEC Rule 10b-5 Securities
violations surrounding Q4 1997, Q1 1998, Q2 1998,
Q3 1998 in re:Causation, Reliance, Misrepresentation, Breach
of fiduciary duty/capacity, Negligence, Malfeasance,
Corporate Governance issues regarding stock option
issuances/repricings contemporaneous with said allegations,
shareholder value destruction, etc. Said "1998 OPTION
AWARDS" issuance date(s) also coincided with the lowest
prices TMSR [ever] reached incl [fiscal 1998] ref/
quote.yahoo.com Said actions
allegedly further confirm Frank Hausmann's role in
continuing said consistent patterns of shareholder allegations
of [alleged] stock fraud in re: insider [non-shareholder]
approved Insider Option Awards/Repricings
contemporaneous with extensive
shareholder value destruction at historically low[est] stock
prices further contemporaneous and in alleged violation
of insider trading sanctions pursuant to said [formally undisclosed]
Q4 INTEL® revised /expanded "IAL MULTIPOINT AUDIO"
agreement ref/ developer.intel.com
[ref/ ThrustMaster Stock Soaring News on Intel®s IAL site
[as of this post incl 12/7/98 through 5/24/99]].
*as chronicled and documented on this TMSR shareholder thread.
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