<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Matria Healthcare, 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
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / 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.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
[LOGO]
MATRIA HEALTHCARE, INC.
1850 PARKWAY PLACE
MARIETTA, GEORGIA 30067
NOTICE OF 1999 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 23, 1999
NOTICE IS HEREBY GIVEN THAT the 1999 Annual Meeting of Stockholders of
Matria Healthcare, Inc. (the "Company" or "Matria"), will be held on Friday,
July 23, 1999, at 10:30 a.m. local time at 1850 Parkway Place, Suite 320,
Marietta, Georgia 30067, for the following purposes:
(1) To elect three Class I directors of the Company for a three year
term expiring at the 2002 Annual Meeting of Stockholders and until their
respective successors are duly elected and qualified; and
(2) To transact such other business as properly may come before the
Annual Meeting and any adjournment or postponement thereof.
Your vote is important regardless of the number of shares you own. Each
stockholder, even though he or she now plans to attend the Annual Meeting, is
requested to sign, date and return the enclosed proxy card without delay in the
enclosed postage-paid envelope. You may revoke your proxy at any time prior to
its exercise. Any stockholder present at the Annual Meeting or any adjournment
or postponement thereof may revoke his or her proxy and vote personally on each
matter brought before the meeting.
I look forward to welcoming you at the meeting.
Very truly yours,
/s/ Roberta L. McCaw
-------------------------
Roberta L. McCaw
SECRETARY
Marietta, Georgia
June 22, 1999
<PAGE>
MATRIA HEALTHCARE, INC.
1850 PARKWAY PLACE
MARIETTA, GEORGIA 30067
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 23, 1999
GENERAL INFORMATION
This proxy statement and the accompanying proxy card are being furnished to
stockholders in connection with the solicitation of proxies by the Board of
Directors of Matria Healthcare, Inc., a Delaware corporation (the "Company"),
for use at the 1999 Annual Meeting of Stockholders (the "Annual Meeting") to be
held on Friday, July 23, 1999 at 10:30 a.m. local time at 1850 Parkway Place,
Suite 320, Marietta, Georgia 30067, and at any adjournment or postponement
thereof.
At the Annual Meeting, stockholders will consider and vote upon a proposal
to elect three Class I directors, and upon such other matters as properly may
come before the Annual Meeting. The Board unanimously urges stockholders to vote
FOR the re-election of the Class I directors.
It is anticipated that this proxy statement, accompanying proxy and the 1998
Annual Report to Stockholders will first be mailed to the Company's stockholders
on or about June 22, 1999.
RECORD DATE
The Board of Directors has fixed the close of business on June 16, 1999 as
the record date (the "Record Date") for the determination of stockholders
entitled to notice of, and to vote at, the Annual Meeting and at any adjournment
or postponement thereof. At the close of business on the Record Date, 36,566,745
shares of Common Stock were issued and outstanding.
PROXIES
When a proxy card is returned, properly signed and dated, the shares
represented thereby will be voted in accordance with the instructions on the
proxy card. If a stockholder does not attend the Annual Meeting and does not
return the signed proxy card, such stockholder's shares will not be voted. If a
stockholder returns a signed proxy card but does not indicate how his or her
shares are to be voted, such shares will be voted FOR the election of the three
Class I directors named herein. As of the date of this proxy statement, the
Board of Directors does not know of any other matters that are to come before
the Annual Meeting. If any other matters are properly presented at the Annual
Meeting for consideration, the persons named in the enclosed form of proxy and
acting thereunder will have discretion to vote on such matters in accordance
with their best judgment.
Any proxy given may be revoked by the person giving it at any time before it
is voted. Proxies may be revoked by (i) filing with the Secretary of the
Company, at or before the taking of the vote at the Annual Meeting, a written
notice of revocation bearing a later date than the proxy, (ii) duly executing a
later dated proxy relating to the same shares of Common Stock and delivering it
to the Secretary of the Company at or before the taking of the vote at the
Annual Meeting or (iii) attending the Annual Meeting and voting in person
(although attendance at the Annual Meeting will not in and of itself constitute
a revocation of a proxy). Any written notice of revocation or subsequent proxy
should be sent so as to be delivered to Matria Healthcare, Inc., 1850 Parkway
Place, Marietta, Georgia 30067, Attention: Secretary, or hand delivered to the
Secretary of the Company at or before the taking of the vote at the Annual
Meeting.
The Company will bear the cost of the solicitation of proxies from its
stockholders. In addition to solicitation by use of the mails, proxies may be
solicited by directors, officers and employees of the Company in person or by
telephone or other means of communication. Such directors, officers and
<PAGE>
employees will not be additionally compensated, but may be reimbursed for
out-of-pocket expenses incurred in connection with such solicitation.
Arrangements also will be made with custodians, nominees and fiduciaries for the
forwarding of proxy solicitation materials to beneficial owners of shares held
of record by such custodians, nominees and fiduciaries, and the Company will
reimburse such custodians, nominees and fiduciaries for reasonable expenses
incurred in connection therewith. In addition, D. F. King & Co., Inc. ("D.F.
King") will assist in the solicitation of proxies by the Company for a fee of
$5,000, plus reimbursement of reasonable out-of-pocket expenses.
QUORUM
The presence, either in person or by properly executed proxies, of the
holders of a majority of the outstanding shares of the Company's Common Stock is
necessary to constitute a quorum at the Annual Meeting. Shares held by a broker
as nominee (i.e., in "street name") that are represented by proxies at the
Annual Meeting, but that the broker fails to vote on one or more matters as a
result of incomplete instructions from the beneficial owner of the shares
("broker non-votes"), will also be treated as present for quorum purposes.
VOTE REQUIRED
The Company's stockholders are entitled to one vote at the Annual Meeting
for each share of Common Stock held of record by them on the Record Date. The
affirmative vote of the holders of a plurality of the shares of Common Stock
present in person or represented by proxy at the Annual Meeting is required to
elect the Class I directors. Votes may be cast for or withheld from each nominee
for Class I director. Under applicable Delaware law, broker non-votes
represented at the meeting, but with respect to which such broker or nominee is
not empowered to vote on a particular proposal will have no effect on the vote
for the election of Class I directors.
I. ELECTION OF DIRECTORS
BACKGROUND
As contemplated by the agreement pursuant to which the Company acquired
substantially all of the assets of Gainor Medical Management, L.L.C., the Board
of Directors was expanded from seven (7) to nine (9) directors on January 19,
1999 in order to elect Mark J. Gainor and Rod F. Dammeyer to the Board effective
upon the closing of the acquisition. Mr. Gainor was elected as a Class II
Director for a term expiring in 2000. Mr. Dammeyer was elected as a Class I
Director for a term expiring at the 1999 Annual Meeting. Also as contemplated by
the acquisition agreement, Mr. Dammeyer has been nominated for re-election as a
director for a term expiring in 2002.
Under the Company's Certificate of Incorporation, the Board is divided into
three classes, with approximately one-third of the directors standing for
election each year. The three nominees for election this year are Donald R.
Millard, Rod F. Dammeyer and Carl E. Sanders. Each has consented to serve for an
additional term. If any director is unable to stand for election, the Board may,
by resolution, provide for a lesser number of directors or designated
substitute. In the latter event, shares represented by proxies may be voted for
a substitute director. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE CLASS I
NOMINEES SET FORTH BELOW.
CLASS I NOMINEES FOR THE TERM EXPIRING IN 2002
DONALD R. MILLARD, age 51, has served as a director of the Company and as
President, Chief Executive Officer and Chief Financial Officer since October 20,
1997, and prior thereto served as Senior Vice President-Finance, Chief Financial
Officer and Treasurer of the Company since the formation of the Company through
the merger (the "Merger") of Tokos Medical Corporation and Healthdyne, Inc.
("Healthdyne") on March 8, 1996 (the "Merger Date"). Mr. Millard served as Vice
President-Finance and
2
<PAGE>
Chief Financial Officer of Healthdyne from July 1987 to March 1996 and in
addition, was Treasurer of Healthdyne from March 1990 to March 1996. Mr. Millard
is also a director of Coast Dental Services, Inc.
ROD F. DAMMEYER, age 58, has served as a director of the Company since
January 19, 1999. Mr. Dammeyer is managing partner of Equity Group Corporate
Investments, a privately held investment firm. In addition, he is a director and
vice-chairman of Anixter International, Inc. where he has been employed since
1985. Mr. Dammeyer is also a director of Antec Corporation, CNA Surety Corp.,
Inc., Grupo Azucarero Mexico, IMC Global, Inc., Jacor Communications, Inc.,
Stericycle, Inc., TeleTech Holdings, Inc. and Transmedia Network, Inc. He is
also a trustee of Van Kempen Investments, Inc. Closed-End Funds.
CARL E. SANDERS, age 74, has served as a director of the Company since the
Merger Date and previously served as a director of Healthdyne from 1986 until
the Merger. Mr. Sanders, a former governor of the State of Georgia, is Chairman
of Troutman Sanders LLP, an Atlanta based law firm which provides legal services
to the Company. Mr. Sanders is also a director of Carmike Cinemas, Inc.,
Metromedia International Group, Inc., Norrell Corporation, HIE, Inc. and World
Access, Inc.
CLASS III DIRECTORS CONTINUING IN OFFICE UNTIL 2001
PARKER H. PETIT, age 59, has served as Chairman of the Board of the Company
since the Merger Date. In addition, he served as a member of the three-person
Office of the President during the period in 1997 preceding the election of
Donald R. Millard as President and Chief Executive Officer of the Company. Mr.
Petit was the founder of Healthdyne and served as its Chairman of the Board of
Directors and Chief Executive Officer from 1970 until the Merger. Mr. Petit is
also Chairman of the Board of Directors of HIE, Inc. and a director of ASA
Holdings, Inc., Intelligent Systems Corp., Norrell Corporation and Logility,
Inc.
FRANK D. POWERS, age 50, has served as Executive Vice President of the
Company since the Merger Date and also has served as a member of the Board and
as Chief Operating Officer since October 20, 1997. Prior thereto, he served as
President of Healthdyne Maternity Management, a subsidiary of Healthdyne, from
October 1989 until March 1996, and as President of Healthdyne's Home Care Group
from November 1986 to October 1989. In addition, he was President of
Healthdyne's Home Care Products Division from September 1984 to November 1986.
MORRIS S. WEEDEN, age 79, has served as a director of the Company since the
Merger Date and previously served as a director of Healthdyne from 1987 until
the Merger. Mr. Weeden, who is retired, was Vice Chairman--Board of Directors of
Morton Thiokol Inc., a salt, chemical, household and aerospace products
manufacturer, from March 1980 to December 1984. Previous positions held by Mr.
Weeden include Executive Vice President of Morton Norwich Products, Inc. in
charge of pharmaceutical operations, President of Morton International, a
pharmaceutical division of Morton Norwich Products, Inc., and President of
Bristol Laboratories, a pharmaceutical division of Bristol Myers Corp.
CLASS II DIRECTORS CONTINUING IN OFFICE UNTIL 2000
MARK J. GAINOR, age 43, has served as a director of the Company since
January 19, 1999. Pursuant to a management agreement with Lucor Holdings, Inc.,
Mr. Gainor has served as President of the Company's diabetes management services
subsidiaries since January 19, 1999. See "Certain Transactions" herein. Prior
thereto he was President and Chief Executive Officer of Gainor Medical
Management, L.L.C., a company founded by his father in 1969.
JACKIE M. WARD, age 60, has served as a director of the Company since the
Merger Date. Ms. Ward is President and Chief Executive Officer of Computer
Generation Incorporated, a privately-held, Atlanta based corporation engaged in
designing and producing "turnkey" computer hardware and software systems for
telecommunications and other specialized applications, which she founded in
1968. Ms. Ward is
3
<PAGE>
also a former Chairperson of the Board of Regents of the University System of
Georgia and former Chairman of the Metro Atlanta Chamber of Commerce, as well as
a director of SCI Systems, Inc., Trigon Healthcare, Inc., BankAmerica
Corporation, Equifax, Inc., Premiere Technologies, Inc., Profit Recovery Group
International, Inc. and Flowers Industries, Inc. and a member of several other
civic and government organizations.
FREDERICK P. ZUSPAN, M.D., age 77, has served as a director of the Company
since the Merger Date and previously served as a director of Healthdyne from
1993 until the Merger. Dr. Zuspan, who has been a physician since 1951, has been
Professor and Chairman Emeritus, Department of Obstetrics and Gynecology at the
Ohio State University College of Medicine since July 1991 and Editor-in-Chief of
the American Journal of Obstetrics and Gynecology since 1991. Dr. Zuspan was
previously Professor of the Ohio State University College of Medicine from 1987
to 1991 and Professor and Chairman of the Department of Obstetrics and
Gynecology at the Ohio State University College of Medicine from 1975 to 1987,
at the University of Chicago, Pritzker School of Medicine from 1966 to 1975, and
at the Medical College of Georgia from 1960 to 1966.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as to the beneficial
ownership of shares of the Company's Common Stock as of June 1, 1999 by (i) all
stockholders known by the Company to be the beneficial owners of more than five
percent of its Common Stock, (ii) each director of the Company, (iii) each Named
Executive Officer (as hereinafter defined), and (iv) all executive officers and
directors as a group. Unless otherwise indicated, the holders listed below have
sole voting and investment power with respect to all shares beneficially owned
by them.
<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL OWNERSHIP PERCENT
NAME OF BENEFICIAL OWNER (1) OF CLASS (2)
- -------------------------------------------------------------------------- ------------------------- -------------
<S> <C> <C>
Gainor Medical Management, L.L.C. (3)..................................... 6,222,222 14.5%
Dimensional Fund Advisors, Inc. (4)....................................... 2,091,700 5.7%
Parker H. Petit (5)....................................................... 878,790 2.4%
Donald R. Millard (6)..................................................... 267,295 --
Frank D. Powers (7)....................................................... 241,103 --
Thornton A. Kuntz, Jr. (8)................................................ 46,345 --
Roberta L. McCaw (9)...................................................... 16,010 --
Yvonne V. Scoggins (10)................................................... 37,083 --
Rod F. Dammeyer (11)...................................................... 6,289,722 14.7%
Mark J. Gainor (12)....................................................... 6,222,222 14.5%
Carl E. Sanders (13)...................................................... 109,500 --
Jackie M. Ward (14)....................................................... 40,004 --
Morris S. Weeden (15)..................................................... 60,000 --
Frederick P. Zuspan (16).................................................. 69,019 --
All current executive officers and directors as a group
(12 persons)............................................................ 8,019,871 18.4%
</TABLE>
- ------------------------
- -- Less than 1%
(1) Under the rules of the Securities and Exchange Commission (the "SEC"), a
person is deemed to be a beneficial owner of a security if he or she has or
shares the power to vote or to direct the voting of such security ("voting
power") or the power to dispose or to direct the disposition of such
security ("investment power"). A person is also deemed to be a beneficial
owner of any securities of which that person has the right to acquire
beneficial ownership within 60 days as well as any securities owned by such
person's spouse, children or relatives living in the same house.
Accordingly, more than one person may be deemed to be a beneficial owner of
the same securities.
4
<PAGE>
(2) Based on 36,562,245 shares of Common Stock outstanding on June 1, 1999. With
respect to each person or group in the table, assumes that such person or
group has exercised all options, warrants and other rights to purchase
Common Stock which he or she beneficially owns and which are exercisable
within 60 days and that no other person has exercised any such rights.
(3) The number of shares owned is based on information contained in a report on
Schedule 13D filed by Gainor Medical Management, L.L.C., Mark J. Gainor and
Gainor Medical U.S.A. Inc. (the "Acquirers") with the Securities and
Exchange Commission (the "SEC") on January 27, 1999. The Acquirers'
principal business address is at 3455 Peachtree Road, Suite 777, Atlanta, GA
30326. Gainor Medical Management, L.L.C. sold substantially all of its
assets to Matria in exchange for, among other things, a currently
exercisable warrant to purchase 4,000,000 shares of Matria's common stock
and 10,000 shares of Series A convertible preferred stock that is currently
convertible into 2,222,222 shares of Matria's Common Stock. Gainor Medical
U.S.A., Inc. beneficially owns 6,222,222 shares by virtue of the fact that
it is the majority member of Gainor Medical Management, L.L.C. Gainor
Medical U.S.A., Inc. disclaims beneficial ownership of 2,811,822 shares, the
ownership of which is attributable to other members of Gainor Medical
Management, L.L.C. Mr. Gainor beneficially owns 6,222,222 shares of Matria
Common Stock by virtue of the fact that he owns, either directly or through
his ownership of Gainor Medical U.S.A., Inc. common stock, a majority of
Gainor Medical Management, L.L.C. See footnotes 12 and 13 below for a
description of shares of stock disclaimed by Mr. Gainor and Rod F. Dammeyer.
(4) The number of shares owned is based on information contained in a report on
Schedule 13G filed with the SEC on February 11, 1999. The address of
Dimensional Fund Advisors, Inc. is 1299 Ocean Avenue, 11(th) Floor, Santa
Monica, California 90401.
(5) Represents 711,290 shares owned by Mr. Petit, 52,500 shares held by Petit
Investments Limited Partnership, 10,000 shares held by Petit Grantor Trust
and 89,167 shares which are subject to purchase upon exercise of options
exercisable within 60 days.
(6) Represents 85,255 shares owned by Mr. Millard, 10,000 shares owned by his
adult son who resides at home, 170,000 shares which are subject to purchase
upon exercise of options exercisable within 60 days, and 2,040 shares
issuable upon conversion of 8% Convertible Subordinated Debentures owned by
Mr. Millard.
(7) Represents 81,103 shares owned by Mr. Powers and 160,000 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
(8) Represents 6,052 shares owned by Mr. Kuntz and 40,293 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
(9) Represents 9,698 shares owned by Ms. McCaw and 6,312 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
(10) Represents 17,395 shares owned by Ms. Scoggins and 19,688 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
(11) Represents 30,000 shares owned by Mr. Dammeyer and 2,500 shares which are
subject to purchase upon exercise of options exercisable within 60 days. Mr.
Dammeyer disclaims ownership of 6,222,222 shares owned by Gainor Medical
Management, L.L.C., a company on whose Management Committee Mr. Dammeyer
serves as a member and, as such, shares voting and investment power over the
securities it owns.
(12) Represents a currently exercisable warrant to purchase 4,000,000 shares and
10,000 shares of Series A convertible preferred stock that is currently
convertible into 2,222,222 shares of Common Stock owned by Gainor Medical
Management, L.L.C. Mr. Gainor is a member of the Management Committee and
owns, either directly or through his ownership of Gainor Medical U.S.A.,
Inc.
5
<PAGE>
common stock, a controlling interest in Gainor Medical Management, L.L.C.
Mr. Gainor disclaims ownership of 801,760 shares of the stock related to the
warrant and 445,422 shares of the stock related to the Series A convertible
preferred stock which are attributable to the owners of Gainor Medical
Management, L.L.C. other than himself and companies that he controls.
(13) Represents 64,500 shares owned by Mr. Sanders and 45,000 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
(14) Represents 4 shares issuable upon conversion of 8% Convertible Subordinated
Debentures owned by Ms. Ward and 40,000 shares which are subject to purchase
upon exercise of options exercisable within 60 days.
(15) Represents 15,000 shares owned by Mr. Weeden and 45,000 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
(16) Represents 29,019 shares owned by Dr. Zuspan and 40,000 shares which are
subject to purchase upon exercise of options exercisable within 60 days.
BOARD COMMITTEES AND ATTENDANCE
In addition to an Executive Committee and other single purpose committees
established from time to time to assist the Board of Directors with particular
tasks, the Company's Board of Directors has the following standing committees: a
Compensation and Stock Option Committee (the "Compensation Committee"), an Audit
Committee and a Nominating Committee.
The Compensation Committee is composed of Morris S. Weeden and Frederick P.
Zuspan, M.D. The Compensation Committee is responsible for the recommendation
and approval of salaries of executive officers and the review and approval of
incentive plans and grants, including stock options and related programs. The
Compensation Committee held six meetings during the year ended December 31,
1998.
The Audit Committee is composed of Jackie M. Ward and Rod F. Dammeyer. The
Audit Committee reviews the scope of the audit of the Company's consolidated
financial statements by independent public accountants and their report on such
audit, evaluates audit performance and reports on such matters to the Board of
Directors. The Audit Committee held two meetings during the year ended December
31, 1998.
The Nominating Committee is composed of Parker H. Petit, Donald R. Millard
and Carl E. Sanders. The Nominating Committee identifies, screens and recommends
candidates for appointment to the Board of Directors for consideration by the
full Board of Directors of the Company and by the stockholders of the Company.
The Committee will consider a candidate for a director proposed by a
stockholder. A candidate must be highly qualified and be both willing and
expressly interested in serving on the Board. A stockholder wishing to propose a
candidate for the Committee's consideration should forward the candidate's name
and information about the candidate's qualifications to Matria Healthcare, Inc.,
1850 Parkway Place, Marietta, Georgia 30067, Attention: Corporate Secretary. The
Nominating Committee held one meeting during the year ended December 31, 1998.
During the year ended December 31, 1998, the Board of Directors held ten
meetings. Each of the Directors who served as directors during 1998 attended
more than 75% of the total number of Board meetings and meetings of committees
of which he or she was a member during 1998.
6
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth compensation paid to the Company's Chief
Executive Officer and the four other most highly compensated executive officers
(the "Named Executive Officers") for their services in all capacities to the
Company and its subsidiaries in each fiscal year during which such person served
as an executive officer of the Company from the Merger Date to December 31,
1998:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
SECURITIES ALL OTHER
NAME AND ----------------------- UNDERLYING COMPENSA-
PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) OPTIONS (#) TION ($) (1)
- ------------------------------------------------- --------- ---------- ----------- ------------------- -------------------
<S> <C> <C> <C> <C> <C>
Donald R. Millard................................ 1998 $ 367,914 $ -0- 160,750 $ 261,324
President and Chief Executive Officer 1997 242,302 243,452 180,000 122,061
1996 170,769 40,000 30,000 4,740
Frank D. Powers.................................. 1998 312,892 -0- 96,450 228,437
Executive Vice President and Chief Operating 1997 250,143 223,819 200,000 123,855
Officer 1996 181,923 -0- 40,000 4,413
Roberta L. McCaw (2)............................. 1998 138,184 -0- 18,575 93,521
Vice President--Legal, General Counsel and
Secretary
Thornton A. Kuntz, Jr............................ 1998 167,523 -0- 19,290 106,958
Vice President-Administration 1997 150,946 95,873 17,250 4,043
1996 138,519 -0- 15,000 3,657
Yvonne V. Scoggins............................... 1998 162,096 -0- 19,290 118,967
Vice President, Chief Accounting Officer and 1997 144,713 81,195 14,375 4,648
Treasurer 1996 131,349 14,000 12,500 4,207
</TABLE>
- ------------------------
(1) For 1996, represents the value of group term life insurance, officer term
life insurance and the Company's matching contributions under the Company's
401(k) Profit Sharing Plan. Details of amounts reported in "All Other
Compensation" column for 1997 and 1998 are provided in the table below.
Effective January 1, 1997, Messrs. Millard and Powers agreed to forego
vested benefits under the Company's non-qualified retirement plan in
exchange for entering into a split-dollar life insurance arrangement with
the Company. Effective July 1, 1998, the Company entered into split-dollar
life insurance agreements with Mr. Kuntz, Ms. Scoggins and Ms. McCaw. The
amounts shown below as "Split Dollar Insurance Premium Value" represent the
present value of the earnings projected to
7
<PAGE>
accrue for the employee's benefit on the current year's insurance premium
paid by the Company plus the portion of the premium paid allocable to the
term life insurance provided under the policy.
<TABLE>
<CAPTION>
ITEM MR. MILLARD MR. POWERS MS. MCCAW MR. KUNTZ MS. SCOGGINS
- ------------------------------------------------- ----------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Officer Term Life Insurance...................... 1998 $ 5,942 $ 4,840 $ 561 $ 907 $ 1,279
1997 1,340 426 N/A 270 648
Split Dollar Insurance Premium Value............. 1998 $ 250,582 $ 218,797 $ 88,160 $ 101,251 $ 112,888
1997 116,721 119,429 N/A -0- -0-
401(k) Matching Contributions.................... 1998 $ 4,800 $ 4,800 $ 4,800 $ 4,800 $ 4,800
1997 4,000 4,000 N/A 3,773 4,000
Total All Other Compensation..................... 1998 $ 261,324 $ 228,437 $ 93,521 $ 106,958 $ 118,967
1997 122,061 123,855 N/A 4,043 4,648
</TABLE>
- ------------------------
(2) Ms. McCaw was promoted to this position on April 27, 1998.
STOCK OPTIONS
The following table contains information concerning the grant of stock
options to the Named Executive Officers of the Company during 1998:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
----------------------------------------- VALUE AT ASSUMED
NUMBER OF % OF TOTAL ANNUAL RATES OF
SECURITIES OPTIONS/SARS EXERCISE STOCK PRICE APPRECI-
UNDERLYING GRANTED TO OR ATION FOR OPTION
OPTIONS EMPLOYEES BASE TERM (2)
GRANTED IN FISCAL PRICE EXPIRATION ------------------------
NAME (#) (1) YEAR ($/SH) DATE 5% ($) 10% ($)
- ----------------------------------------- ----------- --------------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Donald R. Millard........................ 160,750 20.63% $ 5.25 2/24/2008 $ 530,748 $ 1,345,019
Frank D. Powers.......................... 96,450 12.38% 5.25 2/24/2008 318,449 807,011
Roberta L. McCaw......................... 16,075 2.06% 5.25 2/24/2008 59,953 151,933
2,500 .32% 4.375 4/23/2008
Thornton A. Kuntz, Jr.................... 19,290 2.47% 5.25 2/24/2008 63,690 161,402
Yvonne V. Scoggins....................... 19,290 2.47% 5.25 2/24/2008 63,690 161,402
</TABLE>
- ------------------------
(1) These options to purchase the Company's Common Stock were granted under the
Company's 1997 Stock Incentive Plan (the "1997 Plan") as follows: On
February 24, 1998, 160,750, 96,450, 16,075, 19,290 and 19,290 option shares,
respectively, to Mr. Millard, Mr. Powers, Ms. McCaw, Mr. Kuntz and Ms.
Scoggins and on April 23, 1998, 2,500 option shares to Ms. McCaw. For each
option granted under the 1997 Plan, full vesting shall occur not before two
years and not later than four years from the date of grant (the "Vesting
Measurement Date"), based on performance vesting thresholds.
(2) Based on actual option term and annual compounding. These amounts are
calculated pursuant to applicable requirements of the SEC and do not
represent a forecast of the future appreciation of the Company's Common
Stock.
8
<PAGE>
STOCK OPTION EXERCISES
The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options in 1998 and unexercised
options held as of the end of the fiscal year:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY--END OPTION VALUES
<TABLE>
<CAPTION>
VALUE NUMBER OF SECURITIES
REALIZED UNDERLYING UNEXERCISED VALUE OF UNEXERCISED IN-
(MARKET PRICE OPTIONS AT FISCAL YEAR THE-MONEY OPTIONS AT FISCAL
SHARES AT END(#) YEAR END($) (1)
ACQUIRED EXERCISE LESS -------------------------- ------------------------------
NAME ON EXERCISE (#) EXERCISE PRICE) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------------------- --------------- --------------- ----------- ------------- ----------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Donald R. Millard................ 20,000 $ 27,618 175,000 260,750 $ 26,199 -0-
Frank D. Powers.................. 32,667 52,704 146,667 209,783 -0- -0-
Roberta L. McCaw................. -0- -0- 5,312 24,888 -0- -0-
Thornton A. Kuntz, Jr............ 4,168 2,335 35,293 32,915 5,823 -0-
Yvonne V. Scoggins............... -0- -0- 15,522 30,643 -0- -0-
</TABLE>
- ------------------------
(1) Based on $2.875, the last sale price of the Company's Common Stock on
December 31, 1998.
COMPENSATION OF DIRECTORS
Mr. Gainor and the Directors who are employees of the Company receive no
additional compensation for serving on the Board of Directors. With the
exception of Mr. Gainor, Directors who are not employees of the Company
("Non-Employee Directors") receive a fee of $3,000 per quarter, plus $1,000 for
each Board meeting attended and $750 for each Committee meeting attended on a
day other than a Regular Meeting of the Board, and are reimbursed for any travel
expenses incurred. In lieu of the above retainer and meeting fees, Mr. Petit is
paid a fee of $37,500 per quarter for his services as Chairman of the Board. In
addition, under the 1996 Director's Non-Qualified Stock Option Plan, all
Non-Employee Directors other than Mr. Gainor are entitled to receive an initial
grant of options to purchase 5,000 shares of the Company's Common Stock and at
each annual meeting of stockholders after their first full year serving as a
director, an additional grant of options to purchase 10,000 shares of Common
Stock. The option price for all such options is the fair market value of the
underlying Common Stock on the date of grant. Options have a ten year term and
vest monthly over 12 months. In addition, with the exception of Mr. Petit, each
of the Non-Employee Directors who served during 1998 were awarded non-plan
options to purchase 20,000 shares of Common Stock. Mr. Petit received an award
of options to purchase 60,000 shares of Common Stock under the Company's 1997
Stock Incentive Plan. The option price for these options was $5.25 per share,
which was the fair market value of the underlying Common Stock on the date of
grant. These options also have a ten year term and vest monthly over 12 months.
9
<PAGE>
SEVERANCE AGREEMENTS
On April 27, 1999, the Company entered into severance agreements with Mr.
Millard, Mr. Powers and Ms. Scoggins. The severance agreements provide for a
lump sum severance payment to the executive in the event that the executive's
employment is involuntarily terminated for reasons other than the executive's
death, disability or "cause" (defined as certain acts of criminal or civil
fraud), or if the executive voluntarily terminates employment for "good reason"
(defined as failure to be reelected as an officer of the Company, reduction in
base salary, discontinuance of certain incentive or stock option plans or
actions materially adversely affecting the executive's participation therein, or
failure to honor earned and accrued vacation balances). The severance payment
would be in an amount equal to two times the executive's annual base salary and
targeted base bonus as of the date of the agreement (the "Severance Amount").
Mr. Powers also would be entitled to a lump sum severance payment if he
voluntarily terminates his employment without "good reason" at any time after
the first year of the agreement. In such case, the severance payment would be
equal to the Severance Amount less the amount of any gain accruing to Mr. Powers
after the date of the agreement with respect to stock options granted to him by
the Company (whether the grant date is before or after the date of the
agreement) through the earlier of the date of exercise or the date of expiration
of the option. In addition, in circumstances in which an executive is entitled
to a severance payment, the executive also will be entitled to receive, for a
period of two years after the date of termination, life, disability and health
insurance coverage, automobile allowances and other fringe benefits equivalent
to those in effect at the date of termination of employment. The agreements
require the executive to comply with certain covenants, which preclude the
executive from competing with the Company or soliciting customers or employees
of the Company for a period of two years following termination of employment.
At its April 27, 1999 meeting, the Board approved change in control
severance agreements for Mr. Millard, Mr. Powers and Ms. Scoggins. Although
formal agreements have yet to be finalized, the arrangement approved by the
Board contemplates that if the executive's employment with the Company
terminates following the consummation of a "change in control" for reasons other
than the executive's death, disability or retirement, or by the Company for
"cause" (as defined in the preceding paragraph), or if the executive terminates
employment for "good reason" (which is defined to include the reasons set forth
in the preceding paragraph as well as other reasons, such as a reduction in
powers and responsibilities or an adverse change in title), the executive may
elect to receive, in lieu of any severance payments provided in the agreement
described above, a lump sum severance payment equal to three times the
executive's annual base salary and targeted base bonus as of the date of the
agreement. In addition, such executive shall be entitled to receive, for a
period of three years after the date of termination, all life, disability and
health insurance coverage, automobile allowances and other fringe benefits
equivalent to those in effect at the date of termination and will be entitled to
receive additional amounts, if any, relating to any excise taxes imposed on the
executive as a result of Section 280(g) of the Internal Revenue Code of 1986, as
amended (the "Code"). The agreement will require the executive to comply with
certain covenants, which preclude the executive from competing with the Company
or soliciting customers or employees of the Company for a period of three years
following termination of employment.
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE COMPANY'S
PREVIOUS FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE FILINGS,
INCLUDING THIS PROXY STATEMENT, IN WHOLE OR IN PART, THE FOLLOWING REPORT AND
THE STOCK PERFORMANCE GRAPH SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH
FILINGS.
COMPENSATION COMMITTEE REPORT ON CORPORATE COMPENSATION
OVERALL OBJECTIVES AND APPROACH. Prior to the Merger the levels of
compensation of the Named Executive Officers were determined by the respective
Compensation Committees and Boards of Directors of the companies (Tokos or
Healthdyne) by which such individuals were employed. Although certain
adjustments were made to reflect revised responsibilities after the Merger and
the consolidation of benefit
10
<PAGE>
plans, in 1996 the Company did not undertake an overall review of its
compensation programs for executives. In 1997 the Company engaged William M.
Mercer, Incorporated ("Mercer"), a recognized consulting firm with a specialty
in employee compensation to conduct a review of its overall compensation
program, including base compensation, incentive compensation and stock option
programs and to compare the Named Executive Officers to positions of similar
responsibility at other companies both within and outside of the healthcare
industry. A report was presented by Mercer to the Compensation Committee in
April 1997 and, in part, formed the basis for the Compensation Committee's 1997
and 1998 compensation recommendations.
In making its compensation determinations, the Compensation Committee
evaluates, on both an absolute and relative basis, a variety of Company
financial results (including sales, earnings, return on equity, return on assets
and balance sheet strength), market share and competitive position, the
potential for future growth, the overall importance of the individual to the
organization, the individual and group performance of senior management and
compensation levels at comparable companies, especially within the healthcare
industry. In formulating its determinations, it recognizes and rewards
achievements on an annual basis, while emphasizing the value and importance of
sustained long-term performance and recognition of developing trends within the
healthcare industry. The Compensation Committee reviews information prepared or
compiled by the Company, as well as draws on the business experience of the
individual members of the Compensation Committee.
CASH COMPENSATION. Officers and other employees are compensated within
salary ranges that are generally based on similar positions in companies of
comparable size and complexity to the Company. The actual base pay level for
each officer is based on a combination of experience, performance and other
factors that are determined to be important by the Committee. The salary of most
officers is generally reviewed annually at the beginning of each year, with the
amount of any increases based on factors such as Company performance, general
economic conditions, marketplace compensation trends and individual performance.
Cash bonuses for management are paid under the Company's incentive bonus
plan (the "MIP Plan"). Bonuses under the MIP Plan are computed as a percentage
of year-end base salary. The amount of and entitlement to bonuses paid under the
MIP Plan are based upon the performance of the Company in comparison to its
operating budget. The Committee determines the participants in the MIP Plan and
sets the target bonus levels and performance criteria in the first quarter of
each year.
STOCK OPTIONS. On Mercer's recommendation, the Company grants stock options
to certain of its management employees, based on guidelines that take salary
level, tenure, individual performance rating and importance to the Company into
account. Stock options have been granted at exercise prices equal to the market
price on the date of grant and typically become exercisable in one of two ways
(either (i) based on the financial performance of the Company or (ii) in three
annual installments commencing on the first anniversary of the grant), and
expire on the tenth anniversary.
CEO COMPENSATION. The compensation of Mr. Millard, who has served as the
Company's Chief Executive Officer since October 1997, consisted of the same
components as for other senior executives, namely base salary, bonus and stock
options. In establishing the chief executive officer's compensation, the
Committee applied the principles outlined above in essentially the same manner
as they were applied to the other executives. Mr. Millard's compensation was
re-evaluated by the Compensation Committee in October 1997 in connection with
Mr. Millard's promotion to President and Chief Executive Officer. Based on Mr.
Millard's contribution to the Company's strong performance in the first three
quarters of 1997 and increased responsibilities, the Compensation Committee
increased Mr. Millard's annual salary rate from $222,000 to $235,320 effective
for the period from February 1, 1997 through October 31, 1997, and to $310,000
effective November 1, 1997. In February 1998, the Board granted options to Mr.
Millard to purchase 160,750 shares of the Company's Common Stock.
11
<PAGE>
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
Parker H. Petit (ex-officio non-voting member)
Morris S. Weeden
Frederick P. Zuspan
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is responsible for executive compensation
decisions as described above. During 1998, the Compensation Committee consisted
of Morris S. Weeden and Frederick P. Zuspan
PERFORMANCE GRAPH
The following graph shows a comparison of cumulative total returns for the
periods in question for the Company, the S&P 500 Index and the S&P Healthcare
Composite Index. The graph assumes that the value of the investment in the
Company's Common Stock and each index was $100 at April 1, 1996 (the first day
of the first full month of trading of the Common Stock of the Company), and that
all dividends (there were none) were reinvested. The Company's Common Stock
commenced trading on March 8, 1996, closing at a price of $8.875 on that date
and $8.375 on April 1, 1996.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
MATRIA HEALTHCARE, INC S&P 500 INDEX S&P HEALTHCARE COMPOSITE
<S> <C> <C> <C>
April 1, 1996 $100.00 $100.00 $100.00
1996 $56.72 $116.70 $116.23
1997 $67.17 $155.63 $167.04
1998 $34.33 $200.10 $240.89
</TABLE>
12
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Carl E. Sanders, a director of the Company, is also the Chairman of
Troutman Sanders LLP, a law firm based in Atlanta, Georgia, which provided
certain legal services to the Company in fiscal year 1998 and is expected to be
retained by the Company in the future.
Mr. Mark J. Gainor, a director of the Company, is also the President and
Chief Executive Officer of Lucor Holdings, LLC, which entered into an agreement
with the Company, effective January 19, 1999, to provide management services to
the Company's diabetes supplies and services division. The agreement has a term
extending through December 31, 2008, but can be cancelled by either party on 60
days' notice at the end of each calendar year during the term. Management fees
during 1999 are payable at an annual rate of $800,000. Fees payable in
subsequent years will be established by agreement of Lucor Holdings, LLC and the
Company's Board of Directors.
Mr. Gainor indirectly owns a controlling interest in and is the President
and Chief Executive Officer of Gainor Medical Management, L.L.C. ("Gainor
Medical"), and SZ Investments, L.L.C. ("SZI"), a company controlled by Mr. Sam
Zell, owns a minority interest in Gainor Medical. Mr. Rod F. Dammeyer, also a
director of the Company, is the managing partner of Equity Group Corporate
Investments, a privately held investment firm also controlled by Mr. Zell. Both
Mr. Gainor and Mr. Dammeyer serve on Gainor Medical's Management Committee.
On January 19, 1999, pursuant to the Company's acquisition of Gainor
Medical, the Company entered into a five year standstill agreement (the
"Standstill Agreement") with Mr. Gainor and SZI which allows Mr. Gainor and SZI
to increase their stock ownership in the Company to an aggregate of up to 35% of
the Company's Common Stock, on a fully diluted basis, subject to a requirement
that they refrain from any attempt to gain control of the Company during the
term of the Standstill Agreement. Pursuant to this transaction, the Company
amended its shareholder rights plan to permit the acquisition of shares by Mr.
Gainor, SZI and their respective affiliates and permitted transferees within the
limits set forth in the Standstill Agreement. The acquisition agreement related
to the Gainor Medical transaction also provides for the issuance to Gainor
Medical by the Company in the year 2000 of up to $35 million of contingent
subordinated notes payable up to five years after issuance and bearing interest
at twelve percent per annum, 8% to be paid quarterly and 4% accruing to
maturity, if certain performance thresholds are achieved during 1999.
On April 2, 1998, the Company made a loan to Mr. Petit, a director of the
Company, in the principal sum of $1,036,287. The loan was repaid with interest
at 6% per annum on January 1, 1999.
INDEPENDENT AUDITORS
The Board of Directors has appointed KPMG Peat Marwick LLP to audit the
accounts of the Company and its subsidiaries for the fiscal year ending December
31, 1999. A representative of KPMG Peat Marwick LLP will be present at the
Annual Meeting and will have the opportunity to make a statement if he or she so
desires and will be available to respond to appropriate stockholder questions.
STOCKHOLDER PROPOSALS AT THE COMPANY'S NEXT
ANNUAL MEETING OF STOCKHOLDERS
The 2000 Annual Meeting of Stockholders ("2000 Annual Meeting") is
anticipated to be held in June 2000. A notice of intent of a stockholder of the
Company to make a nomination or to bring any other proposal before the 2000
Annual Meeting must comply with the requirements set forth in the Company's
Bylaws and must be received by the Secretary of the Company not more than 90
days and not less than 60 days in advance of the 2000 Annual Meeting. However,
in the event less than 40 days' notice or prior public disclosure of the date of
the 2000 Annual Meeting is given to stockholders, a notice of a stockholder to
bring a matter before the 2000 Annual Meeting, to be timely, must be received no
later than the close of business on the tenth day following the date that notice
of the 2000 Annual Meeting was mailed or such
13
<PAGE>
public disclosure was made, whichever occurs first. The Company will furnish
copies of the Bylaw provisions which set forth the requirements for the notice
of intent by a stockholder upon written request to the Secretary of the Company
at the address set forth below.
In order for proposals by stockholders to be considered for inclusion in the
proxy statement and form of proxy to be distributed by the Board in connection
with the 2000 Annual Meeting, stockholders of the Company must submit such
proposals to the Company no later than January 14, 2000. However, if the 2000
Annual Meeting is held on a date more than 30 days before or after June 23,
2000, any stockholder who wishes to have a proposal included in the Company's
proxy statement for the 2000 Annual Meeting must submit the proposal to the
Company within a reasonable time before the Company begins to print and mail its
proxy materials.
Notices of intention to present proposals at the 2000 Annual Meeting or
requests in connection therewith should be addressed to Matria Healthcare, Inc.,
1850 Parkway Place, Marietta, Georgia 30067, Attention: Corporate Secretary.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, (the
"Act") requires the Company's directors and executive officers and persons who
own more than ten percent of a registered class of the Company's equity
securities to file reports with the SEC regarding beneficial ownership of Common
Stock and other equity securities of the Company. To the Company's knowledge,
based solely on a review of copies of such reports furnished to the Company and
written representations that no other reports were required, during the fiscal
year ended December 31, 1998, all officers, directors and greater than ten
percent beneficial owners complied with the Section 16(a) filing requirements of
the Act in all instances with the exception of Form 4 Reports of Changes in
Beneficial Ownership relating to (i) the purchase of common stock by Frederick
P. Zuspan, M.D. and (ii) the exercise of an option to purchase common stock by
Thornton A. Kuntz, Jr.
ANNUAL REPORT AND FINANCIAL STATEMENTS
The Company will furnish without charge a copy of its Annual Report on Form
10-K filed with the SEC for the fiscal year ended December 31, 1998, including
financial statements and schedules, to any record or beneficial owner of its
Common Stock as of June 16, 1999 upon written or oral request of such person.
Requests for such copies should be directed to:
Matria Healthcare, Inc.
1850 Parkway Place
Marietta, Georgia 30067
Attention: Corporate Secretary
(770) 767-4500
If the person requesting the Form 10-K was not a stockholder of record on
May 5, 1999, the request must include a representation that such person was a
beneficial owner of the Common Stock on that date. Copies of any exhibit(s) to
the Form 10-K will be furnished on request and upon the payment of the Company's
expenses in furnishing such exhibit(s).
GENERAL
Management does not know of any other business to come before the 1999
Annual Meeting. If, however, other matters do properly come before the 1999
Annual Meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in accordance with their best judgement.
Roberta L. McCaw
Secretary
June 22, 1999
14
<PAGE>
MATRIA HEALTHCARE, INC.
1850 PARKWAY PLACE
MARIETTA, GEORGIA 30067
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF STOCKHOLDERS, JULY 23, 1999
The undersigned hereby appoints Donald R. Millard and Roberta L. McCaw, and
each of them, proxies, with full power of substitution and with discretionary
authority, to represent and to vote in accordance with the instructions set
forth below, all shares of Common Stock of Matria Healthcare, Inc. held of
record by the undersigned on June 16, 1999 at the 1999 Annual Meeting of
Stockholders to be held at 1850 Parkway Place, Suite 320, Marietta, Georgia, at
10:30 a.m. on Friday, July 23, 1999 and any adjournments thereof.
1. Election of Class I / / FOR all nominees listed / / WITHHOLD
Directors below (except as written to AUTHORITY
the contrary below) to vote for all
nominees listed
below
Donald R. Millard, Rod F. Dammeyer and Carl E. Sanders.
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- --------------------------------------------------------------------------------
2. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
(Continued on Reverse Side)
<PAGE>
(Continued from other side)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED BY THE
UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR"
ITEM 1.
PLEASE SIGN EXACTLY AS NAME APPEARS ON STOCK CERTIFICATE.
If stock is held in the name of
two or more persons, all must
sign. When signing as attorney, as
executor, administrator trustee,
or guardian, please give full
title as such. If a corporation,
please sign in full corporate name
by President or other authorized
officer. If a partnership, please
sign in partnership name by
authorized person.
Dated: ___________________________
__________________________________
Signature
__________________________________
Signature if Held Jointly
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
