<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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:
<TABLE>
<S> <C>
[ ] 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 Rule 14a-11(c) or Rule 14a-12
</TABLE>
BIRMAN MANAGED CARE, 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> 2
BIRMAN MANAGED CARE, INC.
-----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on November 24, 1998
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Birman Managed
Care, Inc. (the "Company") will be held at the Opryland Hotel, 2800 Opryland
Drive, Nashville, Tennessee 37214, on November 24, 1998 at 9:00 a.m. for the
following purposes:
1. To elect five (5) directors to the Board of Directors to serve until
the Company's 1999 Annual Meeting of Stockholders and until their
successors have been duly elected and qualified.
2. To ratify the selection of Deloitte & Touche LLP as the Company's
independent public accountants for the fiscal year ending June 30,
1999.
3. To ratify the acts of the Company's officers and directors for the
preceding year.
4. To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.
Only stockholders of record at the close of business on October 21, 1998 are
entitled to notice of and to vote at the Annual Meeting. A complete list of the
stockholders of the Company entitled to vote at the Annual Meeting will be
available for the examination of any stockholders for at least ten (10) days
prior to the Annual Meeting of the Company's principal executive office located
at 1025 Highway 111 South, Cookeville, Tennessee, 38501, and will also be
available for inspection at the Annual Meeting.
By Order of the Board of Directors
/S/ Sue D. Birman
------------------------
Executive Vice President
Secretary and Director
Cookeville, Tennessee
October 23, 1998
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND THE 1998 ANNUAL MEETING IN PERSON, PLEASE
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE
WHICH REQUIRES NO ADDITIONAL POSTAGE IF MAILED IN THE UNITED STATES. YOUR PROXY
WILL BE REVOCABLE ANY TIME PRIOR TO ITS EXERCISE EITHER IN WRITING OR BY VOTING
YOUR SHARES PERSONALLY AT THE 1998 ANNUAL MEETING.
- --------------------------------------------------------------------------------
<PAGE> 3
BIRMAN MANAGED CARE, INC.
1025 HIGHWAY 111 SOUTH
COOKEVILLE, TENNESSEE 38501
--------------
PROXY STATEMENT
--------------
FOR ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 24, 1998
GENERAL
This Proxy Statement is furnished in connection with the solicitation of proxies
by the Board of Directors of Birman Managed Care, Inc., a Delaware corporation
(the "Company"), for use at its Annual Meeting of Stockholders to be held at the
Opryland Hotel, 2800 Opryland Drive Nashville, Tennessee, 37214 on November 24,
1998 at 9:00 a.m., and at any and all adjournments thereof. The Company's
principal executive office is located at 1025 Highway 111 South, Cookeville,
Tennessee 38501. This Proxy Statement and the enclosed form of proxy are being
mailed to stockholders on or about October 23, 1998.
A form of proxy is enclosed for use at the Annual Meeting. The proxy must be
signed and dated by you or your authorized agent. A proxy may be revoked at any
time before it is exercised by giving written notice of revocation to the
Secretary of the Company or by submitting, prior to the time of the Annual
Meeting, a properly executed proxy bearing a later date. It may also be revoked
by attendance at the Annual Meeting and election to vote thereat. Stockholders
having executed and returned a proxy, who attend the Annual Meeting and desire
to vote in person, are requested to so notify the Secretary of the Company prior
to the time of the Annual Meeting. Subject to such revocation, all shares
represented by a properly executed proxy received in time for the Annual Meeting
will be voted by the proxy holders in accordance with the instructions on the
proxy.
If no instructions are specified on the proxy, all shares represented by valid
proxies received pursuant to this solicitation (and not revoked before they are
voted) will be voted "FOR" the election of the nominees for director set forth
herein, to "APPROVE" ratification of the acts of the officers and directors of
the Company taken during the previous year, and "FOR" the ratification of
Deloitte & Touche LLP as the Company's independent public accountants for the
fiscal year ending June 30, 1999. If, however, any other matters are properly
presented at the Annual Meeting, the proxy will be voted in accordance with the
best judgment and in the discretion of the proxy holders. For purposes of
determining whether a proposal has received the necessary votes to be approved,
abstentions from voting on any matter other than in the election of directors
will have the effect of a vote "AGAINST" the proposal.
If you hold your shares of Common Stock in "street name" and you fail to
instruct your broker or nominee as to how to vote such shares of Common Stock,
your broker or nominee may, in its discretion, vote your shares of Common Stock
"FOR" the election of the nominees for director set forth herein, to "APPROVE"
ratification of the acts of the officers and directors of the Company taken
during the previous year, and "FOR" ratification of the appointment of Deloitte
& Touche LLP as the Company's independent public accountants for the fiscal year
ending June 30, 1999.
MATTERS TO BE CONSIDERED
The matters to be considered and voted upon at the Annual Meeting are as
follows:
<PAGE> 4
1. Electing five (5) directors to the Board of Directors to serve until
the 1999 Annual Meeting of Stockholders and until their successors
have been duly elected and qualified.
2. Ratifying the appointment of Deloitte & Touche LLP as the Company's
independent public accountants for the fiscal year ending June 30,
1999.
3. Ratify the acts of the officers and directors of the Company taken
during the previous year.
4. Transacting such other business as may properly come before the
meeting or any and all adjournment thereof.
COSTS OF SOLICITATION OF PROXIES
The Company will bear the costs of this solicitation, including the expense of
preparing, assembling, printing and mailing this Proxy Statement and the
material used in this solicitation of proxies. It is contemplated that proxies
will be solicited principally through the mails, but directors, officers and
regular employees of the Company may solicit proxies personally or by telephone.
Although there is no formal agreement to do so, the Company may reimburse banks,
brokerage houses and other custodians, nominees and fiduciaries for the
reasonable expense in forwarding these proxy materials to their principals. In
addition, the Company may pay for and utilize the services of individuals or
companies not regularly employed by the Company in connection with the
solicitation of proxies if the Board of Directors of the Company determines that
this is advisable.
OUTSTANDING SHARES AND VOTING RIGHTS
There were 8,756,254 shares of the Company's common stock issued and
outstanding, par value $0.001 per share ("Common Stock"), as of October 21,
1998, the record date (the "Record Date") for the stockholders entitled to
notice of and to vote at the Annual Meeting. Each stockholder of record at the
close of business on October 21, 1998 is entitled to one vote for each share of
common stock then held on each matter, or any adjournments thereof. The
Company's Certificate of Incorporation also authorizes the issuance of up to
5,000,000 shares of preferred stock, par value $0.001 per share, of which no
shares are currently issued and outstanding.
A majority of the outstanding shares of Common Stock entitled to vote at the
Annual Meeting must be present in person or represented by proxy at the Annual
Meeting in order to constitute a quorum for the transaction of business.
Abstentions and broker non-votes will be treated as shares present and entitled
to vote for purposes of determining the presence of a quorum.
The Company's Certificate of Incorporation does not authorize cumulative voting.
In the election of directors, the five (5) candidates receiving the highest
number of votes will be elected. Ratification of the appointment of Deloitte &
Touche LLP as the Company's independent public accountants and approval of any
other matter which properly comes before the Meeting requires the affirmative
vote of the majority of the shares of the Common Stock present at the Meeting in
person or by proxy and entitled to vote.
<PAGE> 5
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of Common Stock of the
Company as of the Record Date by (i) each person (or group of affiliated
persons) who is known by the Company to own beneficially more than five percent
(5%) of the outstanding shares of Common Stock; (ii) each director or nominee
for director of the Company; (iii) the Chief Executive Officer of the Company;
(iv) each of the four other most highly compensated executive officers of the
Company for fiscal 1998 (the "Named Executives"); and (v) all directors and
Named Executives as a group.
<TABLE>
<CAPTION>
COMMON SHARES
BENEFICIALLY OWNED (1) (5)
---------------------------------
NAME AND ADDRESS OF BENEFICIAL OWNER (3) NUMBER PERCENT (2)
- ------------------------------------------------- --------- -----------
<S> <C> <C>
David N. Birman, M.D.(4) 5,081,606 57.42%
Sue D. Birman(4) 5,081,606 57.42%
Jeffrey L. Drake (9) 37,500 *
Douglas A. Lessard (9) 48,626 *
Rockey C. Talley, M.D. -- *
Betty B. Bibbins, M.D. -- *
Richard M. Ross 175,000 1.98%
John Higgins (6) 4,000 *
James J. Rhodes(7) 5,000 *
Directors and officers as a group (8 persons) (8) 5,446,858 61.55%
</TABLE>
* Less than 1%
(1) Except as indicated in footnotes to this table, the stockholders named in
this table are known to the Company to have sole voting and investment
power with respect to all shares of Common Stock shown as beneficially
owned by them subject to community property laws where applicable. Shares
shown as beneficially owned by any person have been determined in
accordance with the requirements of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934, as amended.
(2) Shares of Common Stock issuable upon exercise of stock options exercisable
within 60 days of the Record Date are deemed outstanding for computing the
percentage of the person or entity holding such securities but are not
deemed outstanding for computing the percentage of any other person or
entity.
(3) The address for each of the beneficial owners is in care of the Company:
1025 Highway 111 South, Cookeville, Tennessee 38501.
(4) Includes 666,667 Escrow Shares. David N. Birman, M.D. disclaims beneficial
ownership as to 550,693 shares beneficially owned by Sue D. Birman
individually. Sue D. Birman disclaims beneficial ownership as to 3,936,010
shares beneficially owned by David N. Birman, M.D. individually.
(5) Includes options to purchase shares of Common Stock scheduled to become
exercisable within 60 days after the Record Date.
(6) Mr. Higgins was granted options under the Company's 1996 Directors' Options
Plan to acquire 3,000 shares of the Company's Common Stock at an exercise
price of $7.50 per share and 6,000 shares at an exercise price of $7.00 per
share.
(7) Mr. Rhodes was granted options under the Company's 1996 Directors' Option
Plan to acquire 6,000 shares of the company's Common Stock at an exercise
price of $5.00 per share and 3,000 shares at an exercise price of $7.00 per
share.
<PAGE> 6
(8) Includes shares subject to options exercisable currently to acquire 95,126
for all officers and directors as a group.
(9) Shares shown for Mr. Lessard and Mr. Drake represent options currently
exercisable to acquire those shares.
DIRECTORS AND EXECUTIVE OFFICERS
ELECTION OF DIRECTORS
The Bylaws of the Company provide that the number of directors shall be one or
more as shall be determined for time to time by the Board of Directors or
stockholders. The Board of Directors of the Company shall be elected at the
Annual Meeting and each director shall be elected to serve until the next annual
meeting or until his successor shall be elected and qualify. The Board of
Directors has established the number of directors at five (5) persons and as of
the date hereof, the Board of Directors consists of: David N. Birman, M.D., Sue
D. Birman, John D. Higgins, James J. Rhodes, and R. Adm. Warren E. Aut (USN,
Ret.).
Each of the persons listed in the table below are present members of the Board
of Directors of the Company and have been nominated for election to serve until
the 1999 Annual Meeting of Stockholders or until their successors are elected
and have qualified. Votes will be cast pursuant to the enclosed proxy in such a
way as to effect the election of said five (5) nominees. In the event that any
of the nominees should be unable to or unwilling to accept nomination for
election as a director, it is intended that the proxy holders will vote for the
election of such substitute nominees, if any, as shall be designated by the
Board of Directors.
The following table sets forth certain information as of the Record Date with
respect to each person nominated and recommended to be elected by the Company's
current Board of Directors.
<TABLE>
<CAPTION>
YEAR FIRST
ELECTED/
NAME AGE POSITION APPOINTED
DIRECTOR
---------------------------- ------- ---------------------------------------------------
<S> <C> <C> <C>
David N. Birman, M.D. 46 Chairman of the Board, President and 1991
Chief Executive Officer
Sue D. Birman 40 Executive Vice President and 1991
Corporate Secretary and Director
John D. Higgins 66 Director 1997
James J. Rhodes 41 Director 1996
Warren E. Aut 65 Director 1998
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE OF "FOR" EACH OF THE NOMINEES LISTED
ABOVE.
Set forth below are brief summaries of the background and business experience,
including principal occupation, of the Company's nominated directors and Named
Executives:
David N. Birman, M.D. has served as Chairman of the Board of Directors,
President, and Chief Executive Officer of the Company and its predecessor
corporations since May 1991. From February 1990 to mid-1991, Dr. Birman served
as Chairman of the Board of Birman, Mathes & Associates, Inc., a consulting
company providing quality management and Medicare reimbursement review services
to rural hospitals. From April 1989 until January 1990, Dr. Birman served as a
consultant, providing quality management and Medicare reimbursement review
services to five rural hospitals. Previously, Dr. Birman was employed by
Whitwell Medical Center, Whitwell, Tennessee where, as a physician assistant, he
performed certain clinical duties and developed patient care management
techniques and reporting strategies that formed the basis for
<PAGE> 7
development of the Quality Management Program. Dr. Birman received his M.D. from
the Universidad Tecnologica de Santiago; his BA, with honors in Biology from
Occidental College; and certification as a physician assistant in primary care
and surgery from the University of Southern California School of Medicine.
Sue D. Birman has served as Executive Vice President and a director of the
Company and its predecessor corporations since May 1991 and served as their
Chief Financial Officer from May 1991 until June 1996. She was elected Corporate
Secretary in March, 1997. From February 1990 to mid-1991, Ms. Birman assisted
Dr. Birman in the financial aspects and business development of Birman, Mathes &
Associates, Inc. From April 1989 until January 1990, Ms. Birman assisted Dr.
Birman in the operation of his consulting firm. Ms. Birman is the spouse of
David N. Birman, M.D.
John D. Higgins was elected a director of the Company in March 1997. Since 1990,
Mr. Higgins has been Senior Vice President - Corporate Finance of Royce
Investment Group, Inc., the Company's managing underwriter for its initial
public offering of Common Stock. Mr. Higgins holds BBA and MBA degrees from
Hofstra University. He is a director of Iatros Health Network, Inc., a
publicly-owned company which is a provider of healthcare services and IRATA,
Inc., a publicly-owned company which operates amusement park photo booths. Mr.
Higgins also is a director of Digital Recorders, Inc., a publicly-owned company
which manufactures and distributes technology products. The company conducts no
business with Iatros Health Network, Inc., IRATA, Inc., or Digital Recorders,
Inc.
James J. Rhodes became a director of the Company in September 1996. Since 1986,
Mr. Rhodes has served as a Regional Manager in the pension division of ManuLife
Financial (The Manufacturer's Life Insurance Company (USA)), a global financial
services company offering annuities, insurance, and investment products.
Rear Admiral Warren E. Aut (USN, Ret.) was appointed to the Board of Directors
in October of 1998. During his 35-year career in the United States Navy, Admiral
Aut served as Commander of Mediterranean Fleet Air Operations, Chief of Staff to
the Supreme Allied Command Atlantic of NATO, Commander of Mediterranean
Anti-Submarine Forces U.S. Sixth Fleet, and Commander of the Naval Training
Center, San Diego, California. While serving as Commander of Mediterranean Fleet
Air Operations, he commanded five naval hospitals and helped develop the naval
hospital administrative corps. After retiring from the U.S. Navy in 1985, he
served on the Board of Directors of WelCorp, a publicly-traded HMO, and as
president or chief executive officer of a number of privately-held corporations.
Currently, he is Managing Director of ISSG, Inc., a privately-held company now
developing new camera technology for use in television. From 1995 to 1997, he
was President of Organization Assessment Company during which time he completed
a world-wide speaking tour presenting The Art of War in the Corporate World.
Prior to this, Admiral Aut was Senior Advisor to a simulator development company
and President of a financial investment company in Dallas, Texas. Admiral Aut
holds a Bachelor of Science degree in Naval Science and earned his Master of
Business Administration at the Naval Post Graduate School.
Jeffrey L. Drake has served as Senior Vice President of Corporate Development of
the Company since July 1997. For approximately three years before joining Birman
Managed Care, Inc., Mr. Drake was Vice President, Managed Care Sales and
Marketing, of Coram Healthcare. From January 1992 through December 1993, Mr.
Drake served as Executive Vice President for American Health Group, Inc. From
1986 through 1991, Mr. Drake was an Executive Vice President with Blue Cross and
Blue Shield of Ohio.
Douglas A. Lessard has served as Vice President, Treasurer and Chief Financial
Officer of the Company since June 1996 and as Controller since January 1996. Mr.
Lessard provided consulting services to the Company from April 1995 through
December 1995. From March 1993 through March 1995, Mr. Lessard served as the
Chief Executive Officer and from September 1991 through March 1993, as Chief
Financial Officer of the American Institute of Professional
<PAGE> 8
Careers, Inc., a private college in Phoenix, Arizona. From March 1989 through
September 1991, Mr. Lessard was employed as Controller of Arizona Building and
Development, Inc., a real estate development and management company. Mr. Lessard
is a Certified Public Accountant in the State of Arizona.
Rockey C. Talley, M.D., has served as Senior Vice President, Chief of
Professional Services, of Birman & Associates, Inc. since September 1997. Dr.
Talley joined Birman & Associates in 1997. Prior to joining the Company, Dr.
Talley served as President-elect and President, Board of Directors, of Southern
Plains Medical Center, Chickasha, Oklahoma, from 1993 to 1997. From 1991 to
1993, he served variously as Chairman of Medical Records, Utilization Review,
Quality Assurance and Internal Medicine Division of Grady Memorial Hospital,
also in Chickasha, Oklahoma. Dr. Talley is Board Certified in Internal Medicine.
He received his medical doctor degree from the University of Oklahoma in 1984.
Betty B. Bibbins, M.D., has served as Corporate Compliance Officer for Birman
Managed Care, Inc. since December 1997. In addition, Dr. Bibbins currently
serves as the Vice President for Professional Services Support of Birman &
Associates, Inc. Dr. Bibbins initially joined Birman & Associates in March 1996
as an independent contractor, Field Physician Manager. She then became a full
time Field Physician Manager in March 1997. Dr. Bibbins is Board Certified in
Obstetrics and Gynecology having completed her medical education at Eastern
Virginia Medical School in 1982, and her internship and residency at the
University of Texas Medical Branch in Galveston in 1986. Among her achievements
prior to joining Birman, Dr. Bibbins was an attending Physician in Obstetrics
and Gynecology from 1986 to 1989; Community Clinical Instructor at the
University of Louisville School of Medicine from 1987 to present; Board of
Trustees Jefferson County Medical Society Foundation; and served on the Board of
Directors for the Kentucky Center for Health Education.
BOARD COMMITTEES
There are two committees of the Board of Directors: the Compensation Committee
and the Audit Committee. The Compensation Committee determines the Company's
executive compensation policies and practices and changes in compensation and
benefits for senior management. The Compensation Committee also administers the
Company's 1995 Stock Option Plan. The Audit Committee reviews the internal
accounting procedures of the Company, consults with the Company's independent
accountants, and reviews the services provided by such accountants. Messrs.
Rhodes and Higgins currently serve as the members of both the Compensation
Committee and Audit Committee.
<PAGE> 9
SUMMARY COMPENSATION TABLE
The following table provides certain information concerning the compensation
earned by the Company's Chief Executive Officer and the four other most highly
compensated executive officers of the Company who received compensation in
excess of $100,000 for services rendered in all capacities to the Company for
fiscal 1998 (the "Named Executive Officers").
<TABLE>
<CAPTION>
Other Awards/
Annual Options All Other
Name and Then - Principal Position Year Salary Bonus Compensation (#) Compensation
- --------------------------------------------- ---------- --------- -------------- -------------------------
<S> <C> <C> <C> <C> <C> <C>
David N. Birman, M.D. 1998 $ 359,257 $ -- $ 73,525 -- $ --
Chairman of the Board, President, 1997 350,000 70,000 73,982 -- --
and Chief Executive Officer (1) 1996 350,000 60,000 69,025 -- --
Sue D. Birman 1998 154,257 -- 14,194 -- --
Executive Vice President, Secretary, 1997 150,000 30,000 12,052 -- --
and Director (2) 1996 150,000 40,000 11,834 -- --
Jeffrey L. Drake 1998 176,494 -- 49,274 150,000 --
Senior Vice President of Corporate 1997 -- -- -- -- --
Development (3) 1996 -- -- -- -- --
Douglas A. Lessard 1998 123,507 -- 17,106 -- --
Chief Financial Officer and Vice 1997 115,000 72,000 16,023 -- --
President (4) 1996 40,500 -- 65,152 72,940 --
Rockey C. Talley, M.D. 1998 168,687 -- 7,854 40,000 --
Senior Vice President, Chief of 1997 -- -- -- -- --
Professional Services, Birman & 1996 -- -- -- -- --
Associates, Inc. (5)
Betty B. Bibbins, M.D. 1998 175,507 -- 8,641 40,000 --
Corporate Compliance Officer, Vice 1997 58,333 -- 21,539 -- --
President for Professional Services 1996 -- -- 136,266 -- --
Support, Birman & Associates (6)
Samuel S. Patterson 1998 179,219 -- 144,831 150,000 --
Senior Vice President, President & 1997 -- -- -- -- --
COO, Birman & Associates, Inc., 1996 -- -- -- -- --
(until 4/22/98), President & COO, BMC
Health Plans, Inc. (until 8/15/98) (7)
</TABLE>
(1) Other Annual Compensation for David N. Birman, M.D. for fiscal 1998 was
$6,979 in medical insurance premiums, $43,367 in officer's life insurance
premiums, $21,247 in auto allowance, and $1,931 in 401(k) matching
contributions; for fiscal 1997, $7,373 in medical insurance premiums,
$43,103 in officer's life insurance premiums, $21,711 in auto allowance,
and $1,795 in 401(k) matching contributions; for fiscal 1996, $5,484 in
medical insurance premiums, $40,903 in officer's life insurance premiums,
$19,638 in auto allowance, and $3,000 in 401(k) matching contributions. In
July 1998, Dr. Birman accepted a 30% salary reduction to $258,659 annually
as part of the Company's cost reduction program.
(2) Other Annual Compensation for Sue D. Birman for fiscal 1998 was $12,849 in
auto allowance and $1,345 in 401(k) matching contributions; for fiscal
1997, $10,387 in auto allowance and $1,665 in 401(k) matching
contributions; for fiscal 1996, $9,834 in auto allowance and $2,000 in
401(k) matching contributions. In July 1998, Ms. Birman accepted a 20%
salary reduction to $126,690 annually as part of the Company's cost
reduction program.
(3) Other Annual Compensation for Jeffrey L. Drake for fiscal 1998 was $6,565
in medical insurance premiums, $6,813 in auto allowance, $925 in 401(k)
matching contributions, $7,446 in moving costs and $27,525 in relocation
buyout expense. In July 1998, Mr. Drake accepted
<PAGE> 10
a 20% salary reduction to $148,000 annually as part of the Company's cost
reduction program.
(4) Other Annual Compensation for Douglas A. Lessard for fiscal 1998 was $6,979
in medical insurance premiums, $9,000 in auto allowance, and $1,127 in
401(k) matching contributions; for fiscal 1997, $7,373 in medical insurance
premiums, $7,500 in auto allowance, and $1,150 in 401(k) matching
contributions; for fiscal 1996, $1,946 in medical insurance premiums,
$25,706 in relocation benefits, and $37,500 in consulting fees paid to Mr.
Lessard prior to being employed by the Company. In July 1998, Mr. Lessard
accepted a 15% salary reduction to $107,687 annually as part of the
Company's cost reduction program.
(3) Other Annual Compensation for Rockey L. Talley, M.D. for fiscal 1998 was
$6,979 in medical insurance premiums and $875 in 401(k) matching
contributions. In July 1998, Dr. Talley accepted a 20% salary reduction to
$140,000 annually as part of the Company's cost reduction program.
(4) Other Annual Compensation for Betty B. Bibbins, M.D. for fiscal 1998 was
$6,979 in medical insurance premiums, $1,500 in 401(k) matching
contributions and $162 in relocation benefits; for fiscal 1997, $21,539 in
consulting fees paid to Dr. Bibbins prior to being employed by the Company;
for fiscal 1996, $136,266 in consulting fees paid to Dr. Bibbins prior to
being employed by the Company. In July 1998, Dr. Bibbins accepted a 20%
salary reduction to $140,000 annually as part of the Company's cost
reduction program.
(5) Other Annual Compensation for Samuel S. Patterson for fiscal 1998 was
$6,979 in medical insurance premiums, $6,948 in auto allowance, $925 in
401(k) matching contributions, $10,279 in moving costs and $119,700 in
relocation buyout expense. Mr. Patterson was terminated in August 1998 in
connection with the discontinuation of the Company's HMO operations.
EXECUTIVE BONUS PLAN
The Company has adopted an Executive Bonus Plan (the "Executive Bonus Plan")
pursuant to which officers of the Company are eligible to receive cash bonuses
after the close of each fiscal year of the Company. The Executive Bonus Plan is
administered by the Compensation Committee of the Board of Directors. Bonuses
are determined on the basis of (i) the operating profit of the Company, (ii) net
revenue growth of the Company achieved as a percentage of the goal established
by the Company at the beginning of the fiscal year, and (iii) the officer's
individual performance and contribution to the Company. An officer's bonus for
any fiscal year may not exceed such officer's annual base salary multiplied by
the Target Bonus Percentage as defined in the Executive Bonus Plan in such
fiscal year. No bonuses were paid or accrued for fiscal 1998.
STOCK OPTION PLANS
1995 Employee Stock Option Plan: The Company has adopted the 1995 Employee Stock
Option Plan (the "1995 Option Plan") pursuant to which key employees, including
officers and directors who are employees, and consultants of the Company are
eligible to receive incentive stock options as well as non-qualified stock
options and stock appreciation rights ("SARs"). The Plan, which expires in
October 2005, is administered by the Compensation Committee of the Board of
Directors. Incentive stock options granted under the Plan are exercisable for a
period of up to 10 years from the date of grant at an exercise price which is
not less than the fair market value of the Common Stock on the date of the
grant, except that the term of an incentive stock option granted under the Plan
to a stockholder owning more than 10% of the outstanding Common Stock may not
exceed five years and the exercise price of an incentive stock option granted to
such a stockholder may not be less than 110% of the fair market value of the
Common Stock on the date of the grant. Non-qualified stock options may be
granted on terms determined by the Compensation Committee of the Board of
Directors. SARs, which give the holder the privilege of surrendering such rights
for an amount of stock equal to the appreciation in the Common Stock
<PAGE> 11
between the time of grant and the surrender, may be granted on any terms
determined by the Compensation Committee of the Board of Directors. The Plan
also permits the grant of new stock options to participants who tender shares of
the Company's Common Stock as payment of the exercise price of stock options or
the payment of withholding tax ("Reload Options"). The Reload Options will be
granted at the fair market value of a share of Common Stock on the date of the
grant and will be exercisable six months following the date of the grant. The
Plan also includes limited option valuation rights upon a change of control of
the Company.
1996 Directors' Option Plan: On September 9, 1996, the Company adopted the 1996
Non-Employee Directors' Non-Qualified Stock Option Plan (the "1996 Directors'
Plan"). A total of 100,000 shares of Common Stock are reserved for issuance
under the 1996 Directors' Plan. Under this plan, upon initial election to the
Board of Directors, non-employee directors are awarded options to purchase 6,000
shares of Common Stock. Upon each subsequent election to the Board of Directors,
non-employee directors receive option awards to purchase 3,000 shares of Common
Stock. These options, which have an exercise price equal to the fair market
value of the shares of Common Stock as of the date of grant, vest at the rate of
33.33% per year. All options awarded under the 1996 Directors' Plan expire on
the first to occur of (i) 10 years after the date of grant, or (ii) 90 days
after the date the director is no longer serving in such capacity for reasons
other than death or disability.
FISCAL 1998 OPTION GRANTS
The following table sets forth certain information concerning individual grants
of incentive stock options to executive officers and directors during the fiscal
year ended June 30, 1998:
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE
SHARES OF TOTAL GRANT DATE
UNDERLYING OPTIONS EXERCISE PRESENT
OPTIONS GRANTED PRICE EXPIRATION VALUE $
NAME OF DIRECTOR OR OFFICER GRANTED UNDER PLAN PER SHARE DATE (1)
------------------------------ ----------- ------------ --------- -------------------------
<S> <C> <C> <C> <C> <C>
Jeffrey L. Drake 150,000 31.8 % $4.75 7/21/04 $487,500
Samuel S. Patterson (2) 150,000 31.8 % $4.75 7/14/04 487,500
Rockey Talley, M.D. 40,000 8.5 % $4.25 3/03/05 119,200
Betty B. Bibbins, M.D. 40,000 8.5 % $4.25 3/03/05 119,200
James J. Rhodes 3,000 0.6% $7.00 12/01/07 14,610
Diedrich Von Soosten (3) 3,000 0.6% $7.00 12/01/07 14,610
John D. Higgins 6,000 1.2% $7.00 12/01/07 29,220
</TABLE>
None of the persons named in the Summary Compensation Table exercised options
during the fiscal year ended June 30, 1998. In August 1998, 112,500 shares of
options granted to Mr. Patterson during fiscal 1998 were forfeited.
(1) The grant date present value of option grants is estimated as of the date
of grant utilizing Black-Scholes options-pricing model with the following
weighted average assumptions for grants in 1998: expected life of options
of eight (8) years, expected volatility of 57.1%, risk-free interest rates
of 4.5%, and a 0% dividend yield.
(2) Mr. Patterson was terminated by the Company in August 1998 in connection
with its discontinuance of HMO operations, at which time his unvested
options for 112,500 common shares lapsed.
(3) Mr. Von Soosten resigned as a director on September 30, 1998.
<PAGE> 12
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR END OPTION VALUES
The following table sets forth certain information with respect to exercises by
the Named Executive Officers of stock options during fiscal 1998 and the value
of all unexercised employee stock options as of June 30, 1998 held by the Named
Executive Officers.
<TABLE>
<CAPTION>
NUMBER OF SHARES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS (1)
----------------------------- -----------------------------
SHARES ACQUIRED VALUE
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------------------- ---------------- ---------- ------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Douglas A. Lessard (2) 0 0 48,627 24,313 $212,985 $106,492
Jeffrey L. Drake 0 0 -- 150,000 -- 150,000
Samuel S. Patterson 0 0 -- 150,000 -- 150,000
Rockey Talley, M.D. 0 0 -- 40,000 -- 60,000
Betty B. Bibbins, M.D. 0 0 -- 40,000 -- 60,000
-----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The value of the Unexercised In-the-Money Options is based upon the $5.75
per share closing price of the Company's Common Stock on the Nasdaq Stock
Market on June 30,1998.
(2) Options may not be exercised until December 1998 under "Lock-up" agreements
signed in connection with the Company's initial public offering of shares.
COMPANY ALTERNATIVE HEALTH PROGRAM
The Company maintains a plan by which under certain conditions employees may
seek and the Company will pay for nutritional counseling commonly known as
"alternative" health care. As part of this plan, employees are required to
report their treatments and allow the Company to monitor their treatment and
progress. The Company views this plan as a research project. The Company spent
approximately $92,000, and approximately nine Company employees participated in
this program in fiscal 1998. This program was discontinued for fiscal 1999.
EMPLOYMENT AGREEMENTS
The Company has employment agreements with each of its current executive
officers. The employment agreements provide for annual salaries that generally
are subject to annual adjustments for increases in the Consumer Price Index;
participation in employee deferred compensation plans, stock options and
retirement and insurance plans; and include customary non competition,
nondisclosure, and severance provisions. Set forth below is a summary of other
principal provisions of those employment agreements:
In March 1996, the Company entered into an employment agreement with David N.
Birman, M.D. for a term expiring June 30, 2001, pursuant to which Dr. Birman
serves as Chief Executive Officer of the Company. The employment agreement
provides for an initial base salary of $350,000 per annum, participation in the
Executive Bonus Plan, and other compensation not to exceed $60,000 per annum.
The employment agreement provides for severance benefits upon termination as a
result of death, for "cause," by mutual agreement, and as a result of
disability. If Dr. Birman's employment is terminated for reasons other than
death, "cause," mutual agreement, or disability, he shall be entitled to receive
his base salary (as most recently adjusted) for the remainder of the initial
term or the applicable renewal term and all unvested stock options granted to
him under 1995 Option Plan shall accelerate and become vested. If Dr. Birman's
employment is not renewed following expiration of the initial term or the
applicable renewal term, he shall be entitled to receive, as severance, his base
salary (as last adjusted) payable over the 12-month period following the
severance of his employment. In July 1998, as part of a cost reduction program,
Dr. Birman accepted a temporary 30% salary reduction.
In March 1996, the Company entered into an employment agreement with Sue D.
Birman for a term expiring June 30, 2001, pursuant to which Ms. Birman serves as
Executive Vice President of
<PAGE> 13
the Company. The employment agreement provides for an initial base salary of
$150,000 per annum, participation in the Executive Bonus Plan, and other
compensation not to exceed $10,000 per annum. The employment agreement provides
for severance benefits upon termination as a result of death, for "cause," by
mutual agreement, and as a result of disability. If Ms. Birman's employment is
terminated for reasons other than death, "cause," mutual agreement, or
disability, she shall be entitled to receive her base salary (as most recently
adjusted) for the remainder of the initial term or the applicable renewal term
and all unvested stock options granted to her under 1995 Option Plan shall
accelerate and become vested. If Ms. Birman's employment is not renewed
following expiration of the initial term or the applicable renewal term, she
shall be entitled to receive, as severance, her base salary (as last adjusted)
payable over the 12-month period following the severance of her employment. In
July 1998, as part of a cost reduction program, Ms. Birman accepted a temporary
20% salary reduction.
In July, 1997, the Company entered into an employment agreement with Samuel S.
Patterson for a term expiring July 13, 2000, pursuant to which Mr. Patterson
serves as Senior Vice President of the Company and President and COO of Birman &
Associates, Inc. The employment agreement provides for an initial base salary of
$185,000 per annum. The employment agreement also provides Mr. Patterson with
the opportunity to earn up to an additional $92,500 per annum based upon the
overall performance of the Company and Birman & Associates, Inc. The employment
agreement provides for severance benefits upon termination as a result of death,
for "cause", by mutual agreement, and as a result of disability. If Mr.
Patterson's employment is terminated for reasons other than death, "cause",
mutual agreement, or disability, he shall be entitled to receive base salary (as
most recently adjusted) payable over the six month period following the
severance of his employment, providing that he has served the Company not less
that one year. In the event the agreement is terminated for any reason, all
unvested options shall lapse. Mr. Patterson was terminated on August 14, 1998
and will receive six months of severance pay in accordance with the terms of his
contract.
In July, 1997, the Company entered into an employment agreement with Jeffrey L.
Drake for a term expiring on July 20, 2000, pursuant to which Mr. Drake serves
as Senior Vice President of Corporate Development of the Company. The employment
agreement provides for an initial base salary of $185,000 per annum. The
employment agreement also provides Mr. Drake with the opportunity to earn up to
an additional $92,500 per annum based upon the overall performance of the
Company as a whole. The employment agreement provides for severance benefits
upon termination as a result of death, for "cause", by mutual agreement, and as
a result of disability. If Mr. Drake's employment is terminated for reasons
other than death, "cause", mutual agreement, or disability, he shall be entitled
to receive base salary (as most recently adjusted) payable over the six month
period following the severance of his employment, providing that he has served
the Company not less that one year. In the event the agreement is terminated for
any reason, all unvested options shall lapse. In July 1998, as part of a cost
reduction program, Mr. Drake accepted a temporary 20% salary reduction.
In March 1996, the Company entered into an employment agreement with Douglas A.
Lessard for a term expiring June 30, 2001, pursuant to which Mr. Lessard serves
as Chief Financial Officer of the Company. The employment agreement provides for
an initial base salary of $120,000 per annum, participation in the Executive
Bonus Plan, and other compensation not to exceed $9,000 per annum. The
employment agreement provides for severance benefits upon termination as a
result of death, for "cause," by mutual agreement, and as a result of
disability. If Mr. Lessard's employment is terminated for reasons other than
death, "cause," mutual agreement or disability, he shall be entitled to receive
his base salary (as most recently adjusted) for the remainder of the initial
term or the applicable renewal term and all unvested stock options granted under
the 1995 Option Plan shall accelerate and become vested. If Mr. Lessard's
employment is not renewed following expiration of the initial term or the
applicable renewal term, he shall be entitled to receive, as severance, his base
salary (as last adjusted) payable over the 12-month period following his
severance of employment. In July 1998, as part of a cost reduction program, Mr.
Lessard accepted a temporary 15% salary reduction.
<PAGE> 14
In July 1997, the Company entered into a Physician Services Agreement with
Rockey C. Talley, M.D., pursuant to which Dr. Talley served as a full time Field
Physician Manager for the Company. This agreement provided for an initial salary
of $140,000 per annum. In September, Addendum 2 to this agreement was amended to
reflect Dr. Talley's promotion to the Senior Vice President & Chief of
Professional Services with a salary of $175,000 per annum. The Physician
Services Agreement provides for termination without cause by either the Company
or by Dr. Talley upon thirty days written notice. This agreement may also be
terminated by the Company at any time for cause and without prior notice upon a
breach of the agreement, fraud, misconduct, embezzlement, or violation of
company policies. In July 1998, as part of a cost reduction program, Dr. Talley
accepted a temporary 20% salary reduction.
In March 1996, the Company entered into a Service Agreement with Betty B.
Bibbins, M.D., pursuant to which Dr. Bibbins initially served as a Field
Physician Manager for the Company as an independent contractor. In March 1997,
the Company entered into a Physician Services Agreement with Dr. Bibbins as a
full time Field Physician Manager, with a salary of $175,000 per annum., The
Physician Services Agreement provides for termination without cause by either
the Company or by Dr. Bibbins upon thirty days written notice. This agreement
may also be terminated by the Company at any time for cause and without prior
notice upon a breach of the agreement, fraud, misconduct, embezzlement, or
violation of company policies. In July 1998, as part of a cost reduction
program, Dr. Bibbins accepted a temporary 20% salary reduction.
COMPENSATION OF DIRECTORS
All directors must receive reimbursement for reasonable expenses incurred in
connection with their attendance at Board of Directors and committee meetings.
In addition, all non-employee directors receive $2,000 for each Board meeting
that they attend. All non-employee directors are also entitled to receive awards
and options to purchase shares of Common Stock under the 1996 Non-Employee
Directors' Non-Qualified Stock Option Plan.
COMPENSATION COMMITTEE'S REPORT ON EXECUTIVE COMPENSATION
The Report of the Compensation Committee of the Board of Directors shall not be
deemed incorporated by reference by any general statement incorporating by
reference this Proxy Statement into any filing under the Securities Act of 1933
or under the Securities Exchange Act of 1934, except to the extent that the
Company specifically incorporates the information contained in the report by
reference, and shall not otherwise be deemed filed under such acts.
COMPENSATION PHILOSOPHY REGARDING EXECUTIVE OFFICERS
The fundamental philosophy of the Company's compensation program is to offer
compensation opportunities for all employees which are based on the individual's
contribution and personal performance. Consideration is also given to a person's
potential for future responsibility and promotion.
In designing and administering the individual elements of the executive
compensation program, the Compensation Committee strives to balance short and
long-term incentive objectives and employ prudent judgment in establishing
performance criteria, evaluating performance and determining actual incentive
payments. Essentially, the executive compensation program of the Company has
been designed to accomplish the following:
- support a pay for performance policy that differentiates in
compensation amounts based on corporate performance;
- motivate key executive officers to achieve strategic business
initiatives and reward them for their achievement;
<PAGE> 15
- provide compensation opportunities which are comparable to those
offered by other leading companies in the health care industry,
thus allowing the Company to compete for and retain talented
executives who are critical to the Company's long-term success;
and
- align the interest of executives with the long-term interest of
stockholders through award opportunities that can result in
bonuses and ownership of common stock.
RELATIONSHIP OF PERFORMANCE UNDER THE COMPENSATION PROGRAM
The compensation program supports the Company's internal culture and human
resource values which are to foster career opportunities and develop the best
people at all levels and to encourage and reward actions which put the interests
of the Company as a whole ahead of functional specialties and individual
considerations.
During 1998, the compensation program for all senior executives is comprised of
the following three elements:
- Base salary and benefits typically offered to executives by
comparable corporations.
- Stock option grants to tie the executives' financial future to
that of the Company in a form which reflects a long-term ownership
interest in the Company.
- An executive bonus plan to reward executives promptly and
significantly for achievement of annual corporate goals.
1998 Compensation Committee
James J. Rhodes
John D. Higgins
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Richard M. Ross served as Vice-Chairman and as a director of the Company from
February 1994 to August 1996. Effective September 1, 1996, Mr. Ross retired as
Vice-Chairman and a newly formed company controlled by Mr. Ross was engaged as a
consultant to the Company pursuant to a consulting agreement (the "Consulting
Agreement"). While serving as Vice-Chairman of the Company, Mr. Ross was
actively involved in policy-making matters relating to day-to-day operations of
the Company and corporate finance. As a consultant, Mr. Ross will undertake
special assignments designated by Dr. Birman and the Board of Directors
including, among other things, developing business plans for acquired companies
and evaluating acquisition candidates. The Consulting Agreement provides for Mr.
Ross to serve as the provider of consulting services thereunder, provides for a
fee to be paid to the consultant firm of $186,000 per annum payable in equal
monthly installments over the 12-month term of the agreement, and provides for
termination of the Consulting Agreement by mutual agreement, upon the occurrence
of an uncured material breach, upon the death of Mr. Ross, or 10 days after
receipt of notice of termination from the consultant. Except as otherwise
provided or as otherwise agreed to by the parties, the Consulting Agreement will
be renewed annually by the Company for up to an additional five consecutive
years.
In October 1997, the Company agreed to buyout the residences of two executives
through a third party relocation company to allow the executives to move to
Cookeville, TN. The Company bought Mr. Drake's residence in Georgia and
subsequently resold the residence in December 1997, at a net cost to the Company
of $27,525. The Company bought Mr. Patterson's residence in Florida and
subsequently resold the property in August 1998, at a net cost to the Company of
$119,700.
<PAGE> 16
John D. Higgins, a director of the Company, is Senior Vice President -Corporate
Finance of Royce Investment Group, Inc., the representative of the underwriters
for the Company's successful February 1997 initial public offering of stock
("Royce"). Mr. Higgins was elected to the Board pursuant to a provision in the
Company's underwriting agreement with Royce which allowed Royce to nominate one
member of the Board of Directors. In addition to underwriting commissions of
$920,000, Royce and the other underwriters received in connection with the
Company's initial public offering a non-accountable expense allowance of
$345,000. As part of the underwriting agreement, the Company also agreed to sell
to Royce and its designees, for nominal consideration, warrants to purchase up
to 200,000 shares of the Company's Common Stock. The warrants will be
exercisable until February 12, 2001 at an exercise price of $7.50 per share
(150% of the initial public offering price of the Common Stock). The shares
acquired upon exercise of the warrant may not be transferred or hypothecated for
one year after exercise. The Company has agreed to register the shares so
acquired at the Company's expense under the Securities Act of 1933. The Company
and Royce also entered into a one-year financial consulting agreement under
which the Company paid Royce a fee of $172,500, i.e., 1.5% of the gross proceeds
of the Company's initial public offering including the sale of the over
allotment. In addition, the Company and Royce entered into a five-year agreement
which provides that if Royce arranges for the sale of substantially all of the
assets of the Company or for a merger, consolidation, or acquisition through and
including February 12, 2001, Royce will receive a fee based on a sinking scale
ranging from 5% of the first $1.0 million of consideration, 4% of the
consideration between $1.0 million and $2.0 million, and 3% of the consideration
in excess of $2 million.
Section 16 (a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who own more than ten percent of
the Common Stock, to file reports of ownership and changes in ownership with the
Securities and Exchange Commission. Executive officers, directors and greater
than ten-percent stockholders are required by Securities and Exchange Commission
regulation to furnish to the Company with copies of all Section 16(a) forms they
file.
Each of the directors, Mr. Drake, Mr. Patterson, and Mr. Lessard filed their
respective Forms 3 on August 28, 1998. Updated Forms 5 for Mr. Higgins, Mr.
Rhodes, Mr. Von Soosten and Mr. Patterson are expected to be filed no later than
November 2, 1998.
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Deloitte & Touche LLP (Deloitte) as its
independent public accountants for the fiscal year ending June 30, 1999, and
stockholders are being asked to ratify the appointment. The appointment was
recommended by the Audit Committee. Deloitte, the Company's accountants for the
fiscal year ended June 30, 1998, performed audit services for fiscal 1998 which
included the examination of the consolidated financial statements and services
related to filings with the Securities and Exchange Commission. All professional
services rendered by Deloitte during fiscal 1998 were furnished at customary
rates and terms. Representatives of Deloitte will be present at the Annual
Meeting and will be available to respond to appropriate questions from
stockholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS PROPOSAL
ANNUAL REPORT
Together with this Proxy Statement, the Company has distributed to each of its
stockholders an annual report for the fiscal year ended June 30, 1998. The
annual report contains consolidated financial statements of the Company and its
subsidiaries and the reports thereon of Deloitte, the
<PAGE> 17
Company's independent public accountants.
UPON WRITTEN REQUEST OF ANY PERSON ENTITLED TO VOTE AT THE MEETING, ADDRESSED TO
INVESTOR RELATIONS, BIRMAN MANAGED CARE, INC., 1025 HIGHWAY 111 SOUTH,
COOKEVILLE, TENNESSEE 38501, THE COMPANY WILL PROVIDE WITHOUT CHARGE AN
ADDITIONAL COPY OF ITS ANNUAL REPORT ON FORM 10-KSB FOR 1998, INCLUDING THE
FINANCIAL STATEMENTS AND THE SCHEDULES THERETO, FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934.
<PAGE> 18
OTHER BUSINESS
The Board of Directors knows of no other business which will be presented for
consideration at the Meeting other than as stated in the Notice of Meeting. If,
however, other matters are properly brought before the Meeting, it is the
intention of the persons named in the accompanying form of proxy to vote the
shares represented thereby in accordance with their best judgment and in their
discretion, and authority to do so is included in the proxy.
By Order of the Board of Directors
/s/ Sue D. Birman
------------------------
Executive Vice President
Secretary and Director
Cookeville, Tennessee
October 23, 1998
<PAGE> 19
Appendix A
BIRMAN MANAGED CARE, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS -- November 24, 1998
(This Proxy is solicited by the Board of Directors of the Company)
The undersigned stockholder of Birman Managed Care, Inc. hereby appoints Sue
D. Birman, with full power of substitution, proxy to vote all shares of stock
which the undersigned could vote if personally present at the Annual Meeting of
Stockholders of Birman Managed Care, Inc. to be held at the Opryland Hotel,
2800 Opryland Drive, Nashville, Tennessee 37214, on November 24, 1998,
telephone number 615-889-1000, at 9:00 a.m. (central standard time), or any
adjournment thereof.
(Continued and to be signed on the Reverse Side)
Please date, sign and mail your
proxy card back as soon as possible!
Annual Meeting of Stockholders
BIRMAN MANAGED CARE, INC.
November 24, 1998
- Please Detach and Mail in the Envelope Provided -
A [X] Please mark your
votes as in this
example.
FOR WITHHOLD
all nominees listed at AUTHORITY
right (except as marked to vote for all
to the contrary) nominees at right
1. ELECTION OF [ ] [ ] Nominees:
DIRECTORS David N. Birman, M.D.
(for terms as Sue D. Birman
described in the Proxy Statement) John D. Higgins
INSTRUCTION: To withheld authority to vote for an James J. Rhodes
individual nominee, write the nominee's name in the Warren E. Aut
space provided below.
- ---------------------------------------------------
FOR AGAINST ABSTAIN
2. RATIFICATION OF ACCOUNTANTS [ ] [ ] [ ]
proposal to ratify the selection of Deloitte &
Touche LLP as independent auditors of the
Company as described in the Proxy Statement.
3. TO RATIFY THE ACTS OF THE COMPANY'S [ ] [ ] [ ]
OFFICERS AND DIRECTORS FOR THE
PRECEDING YEAR.
4. IN THEIR DISCRETION UPON SUCH OTHER MATTERS AS
MAY PROPERLY COME BEFORE THE MEETING.
UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED
FOR THE ELECTION OF THE PERSONS NOMINATED BY MANAGEMENT
- ---
AS DIRECTORS AND FOR PROPOSALS 2 AND 3.
---
Signature of Stockholder Dated:
--------------------- ---------------- ---------
(signature if held jointly)
NOTE: Please date and sign exactly as your name appears hereon. If shares are
held jointly, each stockholder should sign. Executors, administrators,
trustees, etc. should use full title and, if more than one, all should
sign. If the stockholder is a corporation, please sign full corporate
name by an authorized officer.
