SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ X ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Dynamic Healthcare Technologies, 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 ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22 (a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3)
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) 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:
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<PAGE>
DYNAMIC HEALTHCARE TECHNOLOGIES, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of DYNAMIC HEALTHCARE TECHNOLOGIES, INC.:
The Annual Meeting of the Shareholders of DYNAMIC HEALTHCARE
TECHNOLOGIES, INC., a Nebraska corporation, (the "Company" )
will be held at the Sheraton North Orlando Hotel, 600 North Lake
Destiny Drive, Maitland, Florida 32751 on May 21, 1996, at 1:00
p.m. local time, for the following purposes:
1. To elect seven (7) persons as directors for a term of one
year. The slate proposed by the Board of Directors is set forth
in the accompanying Proxy Statement.
2. To vote on the proposal of the Board of Directors that KPMG
Peat Marwick, LLP, independent public accountants, be engaged as
auditors for the Company for the fiscal year ending December 31,
1996.
3. To act upon a proposal to change the state of incorporation
of the Company from Nebraska to Florida pursuant to a Agreement
of Merger between the Company and a wholly-owned subsidiary of
the Company, all as more fully described in the attached Proxy
Statement. SHAREHOLDERS ARE ENTITLED TO CERTAIN DISSENTERS RIGHTS
UNDER NEBRASKA STATUTES SECTIONS 21-20,137 THROUGH 21-20,150, AS
DESCRIBED AND REPRINTED IN THE PROXY STATEMENT ATTACHED.
4. To consider and transact any other business which may
properly come before the meeting or any adjournment thereof.
The Board of Directors has designated April 10, 1996, as the
record date for the determination of shareholders entitled to
notice of and to vote at such meeting or any adjournment
thereof. Only shareholders of record at the close of business
on April 10, 1996, will be entitled to notice of and to vote at
the meeting.
You are cordially invited to attend the meeting. Whether or
not you plan to attend, please mark, sign, date and mail the
enclosed proxy, which requires no postage if mailed in the
United States.
Your attention is called to the accompanying Proxy Statement.
By Order of the Board of Directors
Paul S. Glover
Vice President Finance and
Chief Financial Officer
Dynamic Healthcare Technologies, Inc.
101 Southhall Lane, Suite 210
Maitland, Florida 32751
__________________, 1996
<PAGE>
DYNAMIC HEALTHCARE TECHNOLOGIES, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS MAY 21, 1996
This Proxy Statement is furnished to shareholders of DYNAMIC
HEALTHCARE TECHNOLOGIES, INC., a Nebraska corporation, (the
"Company") in connection with the solicitation on behalf of the
Board of Directors of proxies for use at the Annual Meeting of
Shareholders to be held on May 21,1996, and at any adjournment
thereof, for the purposes set forth in the accompanying Notice
of Annual Meeting of Shareholders.
The address of the principal executive office of the Company is
101 Southhall Lane, Suite 210, Maitland, Florida 32751. This
Proxy Statement and form of Proxy were mailed to shareholders of
the Company on approximately ____________, 1996.
SOLICITATION AND REVOCATION OF PROXIES
The costs and expenses of solicitation of proxies will be paid
by the Company. In addition to the use of mails, proxies may be
solicited by directors, officers and regular employees of the
Company personally or by facsimile machine, telegraph or
telephone.
Proxies in the form enclosed are solicited on behalf of the
Board of Directors. Any shareholder giving a proxy in such form
may revoke it any time before it is exercised, by executing a
subsequent proxy or by notice to the Secretary of the Company at
the Company's principal address as set forth above. Such
proxies, if received in time for voting and not revoked, will be
voted at the annual meeting in accordance with the
specifications indicated thereon. If no instructions are
indicated, proxies will be voted (i) "FOR" the election of the
seven (7) persons named herein as nominees for election to the
Board of Directors; (ii) "FOR" proposals 2 and 3; and (iii) at
the discretion of the proxy holders of record for any other
matter that may properly come before the meeting or any
adjournment thereof. The Board of Directors is not aware that
any matter other than those described in the Notice of Annual
Meeting of Shareholders to which this Proxy Statement is
appended will be presented for action at the meeting.
VOTING RIGHTS AND PROCEDURE
Only Common Stock and Series B Preferred shareholders of record
at the close of business on April 10, 1996 ("Entitled
Shareholders"), are entitled to execute proxies or to vote at
the annual meeting. As of March 20, 1996, there were 6,611,646
shares of Common Stock and 3,750,000 shares of Series B
Preferred Stock outstanding. Each holder of Common Stock and
Series B Preferred Stock is entitled to one vote for each share
held with respect to the matters mentioned in the foregoing
Notice of Annual Meeting of Shareholders and any other matters
that may properly come before the meeting, other than the
election of directors, in which shareholders may cumulate their
votes, (see "Election of Board of Directors"). A majority of
the outstanding shares are required to constitute a quorum at
the meeting.
PROPOSAL NUMBER ONE (1) - ELECTION OF BOARD OF DIRECTORS
Seven (7) Directors are to be elected at the annual meeting to
serve until the 1997 annual meeting of shareholders and until
their successors are elected and qualified. The Board of
Directors has no reason to believe that any of the nominees will
be unable to serve as a director. If, prior to the meeting, any
nominee ceases to be a candidate for election because the
nominee is unable to serve, or for good cause will not serve, it
is the intention of the individuals named as proxies to vote for
the election of such person or persons as the Board of Directors
may, in its discretion, recommend.
Shareholders have cumulative voting rights in connection with
the election of directors. Each Entitled Shareholder may cast a
number of votes equal to the number of shares of Common Stock
and/or Series B Preferred Stock owned by him multiplied by the
number of directors to be elected seven (7). Those votes may be
distributed among all the nominees equally, or divided among any
number of the nominees in such proportion as the shareholder may
desire. The seven (7) nominees who receive the greatest number
of votes will be elected.
Pursuant to a Stock Purchase Agreement ("SPA"), among the
Company and certain purchasers dated December 4, 1995, the
Company sold an aggregate of 3,750,000 shares of Series B
Preferred Stock for aggregate consideration of $3,000,000. As a
result of this transaction, the holders of the outstanding
Series B Preferred Stock in the aggregate hold 36% of the voting
capital stock of the Company. Pursuant to the SPA, the Company
agreed to include in its slate of nominees for directors up to
two persons designated by the holders of Series B Preferred
Stock and use its best efforts to cause such nominees to be
elected to the Company's Board of Directors as soon as possible.
The transactions contemplated by the SPA closed on December 5,
1995. The initial nominees of the Series B Preferred
Shareholders are Messrs. Bret R. Maxwell and Daniel Raynor.
<PAGE>
Unless authority is withheld in the proxy, the persons named in
the enclosed form of proxy will cast the votes of the proxied
shares to elect the seven nominees hereinafter named. These
shares may be voted cumulatively so that one or more of the
nominees may receive fewer votes than the other nominees (or no
votes at all), if such action is considered necessary or
desirable by the proxy holders. The Board of Directors
recommends a vote "FOR" election of the nominees listed below.
NOMINEES FOR ELECTION TO BOARD OF DIRECTORS
Nominee and Director
Principal Occupation Age Since Other Directorships Held
Jerry L. Carson 55 1993 None
Executive Vice President and
Chief Financial Officer
Evans Enterprises
Mitchel J. Laskey, C.P.A. 46 1994 None
President and
Chief Operating Officer
Dynamic Healthcare Technologies, Inc.
Thomas J. Martinson 46 1986 Interventional
President Innovations
Martinson & Company, Ltd. Corporation
Bret Maxwell 37 Nominee Continental Waste
Managing Director Industries
First Analysis Corporation
David M. Pomerance 51 1991 First Mercantile
Chief Executive Officer National Bank, Inc.
Dynamic Healthcare Technologies, Inc. a commercial bank.
Daniel Raynor 36 Nominee Uniforce Services,
Managing Partner Inc.
The Argentum Group
Richard W. Truelick 55 Nominee None
President
Truelick and Associates
Jerry L. Carson has been Executive Vice President and Chief
Financial Officer of Evans Enterprises, a property management
and real estate development firm in Bedford, New Hampshire,
since 1990. Mr. Carson was Executive Vice President and Chief
Financial Officer of Playboy Enterprises, Inc. from 1988 to 1990
and held the positions of Vice President of Corporate
Development and Treasurer of Baxter International from 1980 to
1986. Mr. Carson has been a director of Dynamic Healthcare
Technologies, Inc. since January 1993.
Mitchel J. Laskey has been the President, Chief Operating
Officer and Treasurer of the Company since August 1994. In
December 1994 he was elected as a director. From 1992 to 1994,
he was Chairman and Chief Executive Officer of Dynamic Technical
Resources, Inc. During 1985 to 1991 he was a principal and/or
managing partner in various entrepreneurial investments and also
acted as a volunteer officer for a not-for-profit social agency.
During 1983 and 1984 he was Executive Vice President of Dynamic
Control Division Baxter International and from 1980 to 1983 was
the Executive Vice President of Dynamic Control Corporation, a
healthcare information systems company in which he was a
controlling shareholder.
Thomas J. Martinson has been President of Martinson & Company,
Ltd. of Wayzata, Minnesota, an investment banking firm, since
1985. In March 1996, Mr. Martinson became the Chairman of the
Board of Directors of Interventional Innovations Corporation of
St. Paul, Minnesota. Mr. Martinson has been Chairman of the
Board and a director of Dynamic Healthcare Technologies, Inc.
since 1986. He also was the Company's Secretary from 1986 until
August 1994.
Bret R. Maxwell is a managing director of First Analysis
Corporation, coordinating venture investment. He joined the
organization in 1982, and the solid waste management field is
among his primary areas of expertise. His prior experience
includes consulting for Arthur Andersen & Co. on manufacturing
control systems and engineering work for General Electric Co. on
automated inspection systems, robots and sensing devices. He
received a Bachelor's Degree in industrial engineering and an
MBA, both from Northwestern University.
David M. Pomerance has been the Chief Executive Officer and
Secretary of the Company since July 1994 and August 1994
respectively. Mr. Pomerance is also the Managing General
Partner of Martin Magnetic Imaging, Ltd., a magnetic resonance
imaging (MRI) facility in Stuart, Florida. During 1989 and
1990, Mr. Pomerance was the President of the Healthcare Systems
Division of UNISYS Corporation. During 1984 and 1985, he was
the President of the Dynamic Control Division of Baxter
International and from 1974 to 1984, was the President of
Dynamic Control Corporation, a healthcare information systems
company which he founded. Mr. Pomerance has been a director of
the Company since 1991.
Daniel P. Raynor has been a Managing Partner of The Argentum
Group, a private investment firm, since November 1987, and
Chairman of the General Partner of Argentum Capital Partners,
L.P., a Small Business Investment Company (SBIC), since its
organization in February 1990. Mr. Raynor holds a B.S. in
Economics from The Wharton School, University of Pennsylvania.
Richard W. Truelick is the sole owner of Truelick Associates, a
merger consulting and investment firm and has been employed
there since 1988. During 1979 through 1988, Mr. Truelick was a
partner in Adler-Truelick Associates, also a merger consulting
and investment firm. Mr. Truelick holds a Master's Degree in
Quantitative Economics from the University of Illinois and was
Vice President Corporate Development for Beatrice Foods Company
from 1968-1979.
The business of the Company is managed under the direction of
its Board. The Board of Directors meets periodically to review
significant developments affecting the Company and to act on
matters requiring its approval. The Board of Directors held
eight meetings during 1995. All of the Company's Directors
attended every meeting during 1995 except Dr. Charles Altshuler
who attended only two meetings prior to his resignation on April
6, 1995. Additionally, Mr. Gary S. Kohler attended only one
meeting prior to resigning his directorship on March 2, 1995.
The Compensation and Incentive Stock Option Committee of the
Company's Board of Directors consists of Kenneth C. Coon, Thomas
J. Martinson and Jerry L. Carson. Mr. Coon is the Committee's
chair. The Committee's primary responsibilities are to
formulate and recommend to the Board of Directors the
compensation package for the Company's Chief Executive Officer
and President and Chief Operating Officer; to formulate and
recommend to the Board of Directors the terms of the Company's
Management Incentive Compensation Plan; to recommend approval of
and administer any other employee compensation and incentive
plans; and to periodically review and make recommendations on
the Company's general salary administration plan. The Committee
held one meeting during 1995, which was attended by all its
members.
The Audit Committee of the Company's Board of Directors
consists of, Jerry L. Carson, Kenneth C. Coon and Thomas J.
Martinson. Mr. Carson is the Committee's chair. Mr. Carson and
Mr. Martinson were members of the Committee throughout 1995 and
Mr. Coon joined the Committee in March 1995 to fill the vacancy
created when Gary S. Kohler left the committee. The Audit
Committee recommends to the Board of Directors the appointment
of the firm selected to be independent auditors for the Company
and monitors the performance of such firm; reviews and approves
the scope of the annual audit and evaluates with independent
auditors the Company's annual audit and annual financial
statements; reviews the status of internal accounting controls
with management; evaluates problem areas having a potential
financial impact on the Company which may be brought to its
attention by management, the independent auditors or the Board
of Directors; and evaluates all public financial reporting
documents of the Company. The Audit Committee held one meeting
in 1995 which was attended by all its members.
The Company's Board of Directors does not have a Nominating
Committee. The functions customarily attributable to a
Nominating Committee are performed by the Board of Directors as
a whole. The Board of Directors will consider nominees
recommended by security holders. For a security holder to
recommend a nominee to the Board, the security holder must
contact a member of the Board by mail in care of the Company and
supply the following information:
-- The security holder's name, address and phone number.
-- The number of shares of the Company's Common Stock held by
the security holder.
-- The name, address, phone number and brief biography of the
nominee recommended by the security holder.
<PAGE>
-- A statement by the security holder as to why he or she
believes the recommended nominee should be nominated to stand
for election to the Company's Board of Directors.
The Board of Directors will consider any nominee recommended by
any security holder as long as such recommendation is received
at least six months, but no longer than twelve months, prior to
the next regularly scheduled annual meeting of shareholders.
COMPENSATION OF DIRECTORS
Under a policy established by the Company's Board of Directors,
"outside directors" are compensated at the rate of $500 plus
expenses for each Board meeting attended in person. Each of the
Company's directors, with the exception of Mr. Pomerance and Mr.
Laskey, were compensated under this plan throughout 1995.
Certain outside directors also receive a five year warrant for
25,500 shares of the Company's Common Stock. The warrant is
issued on the date of their first election to the Board of
Directors and the exercise price is equal to the average of the
closing bid and ask prices of the Company's Common Stock on the
date of issuance. Prior to June 14, 1995 these warrants vested
one-third upon issuance and one-third upon each of the first and
second anniversaries of the warrant. After June 13, 1995 these
warrants will be issued to vest 40% upon issuance and 20% on
each anniversary date for three subsequent years. In addition,
annual warrants are to be issued to certain outside directors
starting at the beginning of that director's third consecutive
term in office as an outside director of the Company. Each
annual warrant is for 5,000 shares of the Company's Common
Stock, has a five year term, has an exercise price equal to the
average of the closing bid and ask prices of the Company's
Common Stock on the date of issuance. Prior to June 14, 1995
these warrants vested fully upon issuance. After June 13, 1995
these warrants will be issued to vest 40% upon issuance and 20%
on each anniversary date for three subsequent years. With
certain exceptions, all outside director warrants expire upon
the termination of that director's service to the Company as a
director. Messrs. Carson, Coon, Martinson, and Pomerance (when
an outside director) have all received warrants for the
Company's Common Stock under this Plan.
Mr. Martinson receives $12,000 annually plus expenses for his
services as the Company's Chairman of the Board. In addition,
Martinson & Company, Ltd., provides financial consulting and
advisory services to the Company. The Company incurred $18,500
plus expenses to Martinson & Company, Ltd. for these services in
1995. Mr. Martinson is the President of Martinson & Company,
Ltd.
No director receives any additional compensation for services
to the Company as a member of any committee of the Board of
Directors.
EXECUTIVE OFFICERS
The names, ages and positions of the Company's executive
officers are:
Name Age Officer Position
Thomas J. Martinson 46 Chairman of the Board
David M. Pomerance 51 Chief Executive Officer and
Secretary
Mitchel J. Laskey,CPA 46 President and Chief Operating
Officer and Treasurer
Paul S. Glover 37 Vice President Finance and
Chief Financial Officer
Philip R. Kneeland 39 Vice President Technical
Operations
Linda A. Moline, RRA 40 Vice President Professional
Services
Matthew P. Lawton 52 Vice President Client Sales
Mary Lu Lander 55 Vice President Marketing
Bruce B. Sherr 57 Vice President New Business
Sales
Steven J. Akerson 46 Vice President Clinical
Products
<PAGE>
Thomas J. Martinson has been President of Martinson & Company,
Ltd. of Wayzata, Minnesota, an investment banking firm, since
1985. In March 1996, Mr. Martinson became the Chairman of the
Board of Directors of Interventional Innovations Corporation of
St. Paul, Minnesota. Mr. Martinson has been a director and
Chairman of the Board since 1986. He was also the Company's
Secretary from 1986 until August 1994.
David M. Pomerance has been the Chief Executive Officer and
Secretary of the Company since July 1994 and August 1994
respectively. Mr. Pomerance is also the Managing General
Partner of Martin Magnetic Imaging, Ltd., a magnetic resonance
imaging (MRI) facility in Stuart, Florida. During 1989 and
1990, Mr. Pomerance was the President of the Healthcare Systems
Division of UNISYS Corporation. During 1984 and 1985, he was
the President of the Dynamic Control Division of Baxter
International and from 1974 to 1984, was the President of
Dynamic Control Corporation, a healthcare information systems
company which he founded. Mr. Pomerance has been a director of
the Company since 1991.
Mitchel J. Laskey, CPA has been the President and Chief
Operating Officer, Treasurer of the Company since August 1994.
In December 1994 he was elected as a director. From 1992 to
1994, he was Chairman and Chief Executive Officer of Dynamic
Technical Resources, Inc. During 1985 to 1991 he was a principle
or managing partner in various entrepreneurial investments and
also acted as a volunteer officer for a not-for-profit social
agency. During 1983 and 1984 he was Executive Vice President of
Dynamic Control Division Baxter International and from 1980 to
1983 was the Executive Vice President of Dynamic Control
Corporation, a healthcare information systems company in which
he was a controlling shareholder.
Paul S. Glover is the Vice President of Finance and CFO for the
Company since December 2, 1994. Prior to joining the Company as
Director of Financial Operations in August, 1994, Mr. Glover was
the Executive Vice President of Uniprompt Microsystems, Inc. and
President of its wholly owned subsidiary Unisoft, Inc. From
September 1985 to July 1990 Mr. Glover was employed by Winthrop
Financial Associates and its affiliate Bariston Associates, Inc.
Both companies are investment banking firms headquartered in
Boston, Massachusetts. During this period Mr. Glover was also
the President, Registered General Securities Principle and
Financial Securities Principle for Bariston Securities, Inc. a
wholesale investment securities brokerage, and wholly owned
subsidiary of Bariston Associates, Inc. From 1980 to 1985, Mr.
Glover served as a CPA with the national firms of Main Hurdman
and Company (d/b/a KPMG Peat Marwick LLP), and Deloitte, Haskins
and Sells (d/b/a Deloitte & Touche LLP).
Philip R. Kneeland has been Vice President of Technical
Operations for the Company since August 1994. From 1992 to 1994
he was Vice President of Development for Dynamic Technical
Resources, Inc. From 1983 to 1992, Mr. Kneeland was employed by
IBAX Healthcare Systems in capacities related to health care
data processing consulting and facilities management with
emphasis in developing and implementing new service products.
Linda A. Moline has been Vice President of Professional
Services for the Company since August, 1994. From 1992 to 1994
she held the position of Director of Customer Services for
Dynamic Technical Resources, Inc. Ms. Moline, who is a
Registered Records Administrator (RRA) was development manager
of application design for IBAX Healthcare Systems, where she was
employed from 1985 to 1992.
Matthew P. Lawton has been Vice President of Sales for the
Company since August 1994. He was Director of Sales and
Marketing for Dynamic Technical Resources, Inc. from 1992 to
1994. He has extensive health care systems experience with
multiple HIS vendors including IBAX Healthcare Systems where he
held the position of Vice President of Product Development.
Mary Lu Lander has been Vice President of Marketing for the
Company since September, 1994. From 1991 to 1994 she was
President of Health Practice Services, a remarketer of physician
practice management systems. Prior to 1991, she was Director of
Marketing Services for Unisys Corporation, Healthcare Systems
Division.
Bruce B. Sherr has been Vice President New Business Sales for
the Company since October 1995. Prior to joining the Company
Mr. Sherr was Vice President of Sales and Marketing for
Biovation, a laboratory information systems company during 1995
and part of 1994. During 1993 and 1994, Mr. Sherr was Vice
President of Sales for the Western Division of First Data
Corporation, Health System Group. Mr. Sherr was Vice President
of Sales for Micro Health Systems during 1992 and 1993, and was
Director of Sales for Critikon's Vitalnet Nursing Point of Care
Systems from 1990 to 1992.
Steven J. Akerson is the Vice President Clinical Products for
the Company. He was the Director of Product Development at the
Company from 1994 until March 1996. From 1983 to 1994, Mr.
Akerson was employed by IBAX Healthcare Systems in various
management and director level positions in the product
development area.
<PAGE>
CERTAIN TRANSACTIONS
During the year ended December 31, 1995 the Company incurred
$65,000 of airline transportation charges from DDK Enterprises
LLC ("DDK") on terms which management believes approximate fair
market value. DDK is majority owned by Mr. David Pomerance
(CEO and Director).
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of March
20, 1996, with respect to each class of the Company's equity
securities beneficially owned by each director, director
nominee, by each person known to the Company to beneficially own
more than 5% of the Company's outstanding classes of voting
stock (ie. Common Stock and Series B Preferred Stock), , and by
all officers and directors as a group.
Series A Preferred Stock**
Name and Address Amount and Nature of Percentage
of Beneficial Owner Beneficial Ownership of Class
Okabena Partnership, K (7) 125,000 12.90%
5140 Norwest Center
Minneapolis, MN 55402
Mitchel J. Laskey (8) 125,000 12.90%
1611 Talisia Court
Longwood, FL 32779
David M. Pomerance (9) 125,000 12.90%
2421 Southeast Bahia Way
Stuart, FL 34996
Thomas J. Martinson (10) 62,500 6.45%
140 Barry Avenue North
Wayzata, MN 55391
Richard W. Truelick (13) 62,500 6.45%
Truelick & Associates
280 Deer Ridge Lane
Snowmass, CO 81615
All Directors and Officers
as a Group
(12 Persons) 312,500 32.26%
Series B Preferred Stock
Name and Address Amount and Nature of Percentage
of Beneficial Owner Beneficial Ownership of Class
The Productivity Fund,
III, LP 1,031,250 27.50%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Environmental Private
Equity Fund II, LP 1,031,250 27.50%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Argentum Capital
Partners, LP 938,750 25.03%
405 Lexington Avenue,
54th Floor
New York, NY 10174
First Analysis
Corporation (2) 2,062,500 55.00%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Walter Barandiaran (3) 2,070,000 55.20%
245 East 93rd Street,
Apt. 26D
New York, NY 10128
Oliver Nicklin (4) 2,062,500 55.00%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Daniel P. Raynor (5) 2,032,500 54.20%
c/o The Argentum Group
405 Lexington Avenue,
54th Floor
New York, NY 10174
Bret R. Maxwell (6) 2,093,750 55.83%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
All Directors and Officers as a Group
(12 Persons) 0 *
Common Stock
Name and Address Amount and Nature of Percentage
of Beneficial Owner Beneficial Ownership of Class
The Productivity Fund,
III, LP 1,031,250 13.49%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Environmental Private
Equity Fund II, LP 1,031,250 13.49%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Argentum Capital
Partners, LP 938,750 12.43%
405 Lexington Avenue,
54th Floor
New York, NY 10174
First Analysis Corporation (2) 2,062,500 23.78%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Walter Barandiaran (3) 2,280,000 25.64%
245 East 93rd Street,
Apt. 26D
New York, NY 10128
Oliver Nicklin (4) 2,062,500 23.78%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Daniel P. Raynor (5) 2,242,500 25.33%
c/o The Argentum Group
405 Lexington Avenue,
54th Floor
New York, NY 10174
Bret R. Maxwell (6) 2,093,750 24.05%
233 South Wacker Dr.,
Suite 9500
Chicago, IL 60606
Okabena Partnership, K (7) 650,000 9.62%
5140 Norwest Center
Minneapolis, MN 55402
First Bank System, Inc. 499,600 7.56%
601 Second Avenue South
Minneapolis, MN 55402
Mitchel J. Laskey (8) 888,255 12.86%
1611 Talisia Court
Longwood, FL 32779
David M. Pomerance (9) 365,500 5.27%
2421 Southeast Bahia Way
Stuart, FL 34996
Thomas J. Martinson (10) 177,500 2.65%
140 Barry Avenue North
Wayzata, MN 55391
Kenneth C. Coon (11) 20,000 *
3334 Pine Street
Omaha, NE 68105
Jerry L. Carson (12) 40,500 *
3971 Gulfshore Blvd. North PH302
Naples, FL 33940
Richard W. Truelick (13) 72,500 1.08%
Truelick & Associates
280 Deer Ridge Lane
Snowmass, CO 81615
All Directors and Officers
as a Group
(12 Persons) 1,892,681 25.65%
*Less than 1%
**Series A Preferred Stock is non-voting unless dividends are in
arrears for two calendar quarters. As of the established
record date of April 10, 1996 the Series A Preferred Stock is
non-voting.
(1) Shares not actually outstanding are deemed to be
beneficially owned by an individual if such individual has the
right to acquire the shares within 60 days. Additionally,
beneficially owned common stock includes shares assumed issued
pursuant to conversion privileges of shareholders of Series A
and Series B Preferred Stock on a share for share basis.
(2) By reason of its status as an ultimate general partner of
The Productivity Fund III, LP ("PFIII"), and Environmental
Private Equity Fund II, LP ("EPEF"), First Analysis Corporation
("FAC"), may be deemed to be the indirect beneficial owner of
2,062,500 shares of the Company's Series B Preferred Stock owned
by PFIII and EPEF.
(3) The table includes 50,000 shares of Series B Preferred Stock
owned by Mr. Walter Barandiaran through his individual
retirement account, and 50,000 shares of Series B Preferred
Stock held by an individual retirement account for the benefit
of his spouse and controlled by Mr. Barandiaran pursuant to a
power of attorney. Additionally, by reason of Mr. Barandiaran's
status as controlling persons of Argentum Capital Partners, LP
("ACP"), The Argentum Group ("TAG"), and the general partner of
EPEF, the table includes indirect beneficial ownership by him of
1,970,000 shares of Series B Preferred Stock owned by ACP and
EPEF and 210,000 additional shares of Common Stock which may be
acquired by TAG upon the exercise of stock purchase warrants.
As of March 20, 1996 TAG held warrants for 210,000 shares of the
Company's Common Stock.
<PAGE>
(4) By reason of Mr. Oliver Nicklin's status as the majority
stockholder of FAC, the ultimate general partner of PFIII and
EPEF, the table includes 2,062,500 shares of Series B Preferred
Stock of PFIII and EPEF attributed to Mr. Nicklin as the
indirect beneficial owner.
(5) The table includes 31,250 shares of Series B Preferred Stock
owned by Mr. Daniel Raynor and 31,250 shares of Series B
Preferred Stock attributed to him through ownership by Ms.
Sandra Raynor, his spouse. Additionally, by reason of Mr.
Raynor's status as controlling person of ACP, TAG and the
general partner of EPEF, the table includes indirect beneficial
ownership by him of 1,970,000 shares of Series B Preferred Stock
owned by ACP and EPEF, and 210,000 additional shares of Common
Stock which may be acquired by TAG upon the exercise of stock
purchase warrants. As of March 20, 1996 TAG held warrants for
210,000 shares of the Company's Common Stock.
(6) By reason of his status as the ultimate general partner of
PFIII and EPEF, Mr. Bret Maxwell may be deemed to be the
indirect beneficial owner of 2,062,500 shares of the Company's
Series B Preferred Stock owned by PFIII and EPEF.
(7) The table includes 20,000 shares of Common Stock that
Okabena Partnership, K may acquire upon the exercise of stock
purchase warrants. As of March 20, 1996, Okabena Partnership, K
held warrants for 20,000 shares of the Company's Common Stock.
(8) Includes 170,000 shares of Common Stock that Mitchel J.
Laskey may acquire upon the exercise of stock purchase warrants.
At March 20, 1996, Mr. Laskey held warrants for 320,000 shares
of the Company's Common Stock.
(9) Includes 200,500 shares of Common Stock that David M.
Pomerance may acquire upon the exercise of stock purchase
warrants. At March 20, 1996, Mr. Pomerance held warrants for
350,500 shares of the Company's Common Stock.
(10) Includes 10,000 shares held by Joan Martinson. Thomas and
Joan Martinson are husband and wife. Also includes 30,000
shares of Common Stock that Thomas J. Martinson may acquire upon
exercise of stock purchase warrants.
(11) Includes 20,000 shares of Common Stock that Kenneth C. Coon
may acquire upon the exercise of stock purchase warrants. At
March 20, 1996, Mr. Coon held warrants for 20,000 shares of the
Company's Common Stock, which were fully vested.
(12) Includes 35,500 shares of Common Stock that Jerry L. Carson
may acquire upon the exercise stock purchase warrants. At March
20, 1996, Mr. Carson held warrants for 35,500 shares of the
Company's Common Stock, which were fully vested.
(13) The table includes 10,000 shares of Common Stock that Mr.
Richard W. Truelick may acquire upon the exercise of stock
purchase warrants. As of March 20, 1996 Mr. Truelick held
warrants for 10,000 shares of the Company's Common Stock.
<PAGE>
REPORTS BY INSIDERS UNDER SECTION 16
Section 16 of the Securities Exchange Act of 1934 requires,
among other things, that a company's insiders report the
holdings and transactions in a company's common stock to the
Securities and Exchange Commission on a timely basis. Further,
any delinquent or incorrect filings known to the company are to
be reported to the company's shareholders in its annual proxy
statement. The following is a listing of statutory insiders as
defined under Section 16 of the Securities Exchange Act of 1934
who made delinquent Section 16 filings during 1995:
Name of Insider Relationship Number of Number of
to The Registrant Late Reports Transactions
Reported Late
Bruce B. Sherr V.P. - New Sales 2 1
Mary Lu Lander V.P. - Marketing 2 3
The Company knows of no incorrect filings made by the Company's
insiders under Section 16 of the 1934 Act for 1995 transactions
in the Company's Common Stock.
EXECUTIVE COMPENSATION
Report of Compensation Committee
The Compensation Committee is charged with the formulation and
oversight of the Company's general compensation policies and
plans, including those for its executive officers. The
Committee consists of Kenneth C. Coon, its chair, Thomas J.
Martinson and Jerry L. Carson, all of whom are independent
members of the Company's Board of Directors.
The Company's general compensation policies are designed to
attract and retain exceptional employees at all levels of the
organization. Specific policies exist for members of the
Company's sales organization to incent those people to increase
the Company's operating revenues. Additional policies for
certain of the Company's executives and other key employees
focus those employees' energies on the Company's long-term
strategies for growth, profitability and enhancement of
shareholder value. The principal elements of these policies are:
Base Salary: Base salaries are set for all employees through
the use of a compensation matrix which identifies ranges of
salaries for each job level as well as performance standards
within each level. The matrix is adjusted annually for changes
in the Consumer Price Index, and is designed to provide
employees receiving positive performance reviews with a base
salary approximating the 75th percentile among salaries for
similar positions within the Company's peer group. The
Committee annually reviews the salaries of executives in
relation to this matrix and in conjunction with the executives'
performance reviews and with the salaries suggested by the CEO,
President and COO.
Sales Commissions: The Company provides direct sales
representatives and sales management personnel with commissions
in addition to their base salary. The commissions are paid on
the achievement of certain sales goals under the Company's Sales
Policy and Commission Plans which are administered by the CEO,
President and COO.
Management Incentive Compensation: Executive officers of the
Company who are not a part of the Company's sales organization
are eligible to receive cash incentives under the Company's
Management Incentive Compensation (MIC) Plan which is
administered by the CEO, President and COO under the direction
of the Compensation Committee. Awards under this Plan may be
recommended annually by the CEO, President and COO, and require
the approval of the Compensation Committee.
<PAGE>
Incentive Stock Option Plan: As additional incentive for the
Company's executives and other key employees to build
shareholder value, stock options have been awarded under the
Company's 1983 and 1993 Incentive Stock Option Plans. Under
provisions of the Internal Revenue Code, options granted under
these Plans are considered "Incentive Stock Options". The
Compensation Committee functions as the Company's Incentive
Stock Option Committee and is responsible for approving all
awards under these Plans. Grants of options under the 1983 Plan
are no longer allowed as that Plan has expired. Grants under
the 1993 Plan, which was approved by the shareholders in 1993,
are permitted until 2003.
Officer and Director Stock Warrant and Option Plan: In order
to attract and incent directors and key managers of the Company,
options and warrants for the Company's Common Stock may be
granted under the Company's Officer and Director Stock Warrant
and Option Plan which was approved by the shareholders in 1993.
Grants under this Plan are made under the direction of the
Compensation Committee and are "non-qualified" as that term is
defined in the Internal Revenue Code.
Employee Stock Purchase Plan: The Company adopted the
Employee Stock Purchase Plan in 1993 for the purpose of
encouraging full time employees to become shareholders in the
Company. Employees pay for their shares through voluntary
payroll deductions. This Plan qualifies for favorable tax
treatment to employees under Section 421 and 423 of the Internal
Revenue Code.
Dynamic Healthcare Technologies, Inc. Compensation and
Stock Option Plan Committee
Kenneth C. Coon, Chairman
Thomas J. Martinson
Jerry L. Carson
<PAGE>
Summary Compensation Table
The following table sets forth the indicated compensation paid
and/or accrued to the Company's Chief Executive Officer and
other Corporate officers with 1995 annual compensation, as
defined in Item 402 of Regulation S-K, exceeding $100,000 for
the years indicated.
Long-Term Compensation
Annual Compensation Awards Payouts
Name and Incentive
Principal Compensation
Position Year Salary ($)
($)
Other Annual Compensation ($) (1)
Restricted Stock Awards($)
Options/ SARs (#) LTIP Payouts ($) All
Other Compensation ($) (2)
David M. Pomerance
Director and CEO 1995
1994 $151,750 $73,365 -- -- $ 7,800 $ 2,600
-- -- --
250,000 (3) -- -- $ 2,772 804
Mitchel J. Laskey Director, President and COO 1995 1994
$151,750$ $ 50,000 -- -- $ 7,800 $ 2,600 -- --
- -- 250,000 (3) $50,000 20,833 (4) $ 2,772
924
Philip R. Kneeland Vice President, Technical Operations 1995
1994 $100,000 $ 33,333 -- -- $ 7,800 $ 2,600 --
- -- -- 25,000 (5) -- -- -- $ 2,772 920
Matthew P. Lawton Vice President, Customer Sales 1995 1994
$100,000 $ 31,667 -- -- -- -- -- -- 10,000 (5) --
-- --
(1) Includes amounts paid as car allowance, club dues and other
compensation travel related payments.
(2) All Other Compensation includes Company contributions to
the individual employees' 401-(K) Retirement Plan.
(3) Options awarded during 1994 were additional compensation
under respective employment agreements.
(4) Represents amounts paid under a deferred compensation
agreement with Mitchel J. Laskey assumed in connection with the
acquisition of Dynamic Technical Resources, Inc. and is payable
in 19 remaining monthly installments of $4,167 as of December
31, 1995.
(5) Options awarded under the Company's Incentive Stock Option
Plan.
OPTION GRANTS DURING 1995 FISCAL YEAR
The following table sets forth information relative to stock
options granted to officers of the Company during 1995 whose
1995 annual compensation exceeded $100,000.
<TABLE>
Individual Grants
Potential Realizable Value At Assumed
Annual Rates of Stock Price Appreciation For Option Term
Name Number of Options Granted Percent of All Options
Granted To Employees In 1995 Exercise Price Per Share
Expiration Date 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
Mitchel J. Laskey 250,000 (1) 38.00% $1.00 08/23/99 $15,131 $ 68,524
David M. Pomerance 250,000 (1) 38.00% $1.00 07/06/99 $13,484 $ 64,737
Philip R. Kneeland 25,000 (2) 3.80% $1.00 06/13/05 $13,177 $ 35,791
Matthew P. Lawton 10,000 (2) 1.52% $1.00 08/23/05 $ 5,271 $ 14,316
</TABLE>
(1) On September 13, 1995, the Company's Board authorized the
reduction of the option price to $1 per common share on the
previously granted employment contract options covering 250,000
shares to each of Messrs. Pomerance and Laskey.
(2) Options awarded under the Company's Incentive Stock Option
Plan.
<PAGE>
OPTION EXERCISES DURING 1995 FISCAL YEAR AND
YEAR END OPTION VALUES
The following table sets forth information relative to stock
options exercised by officers of the Company during 1995 whose
1995 annual compensation exceeded $100,000 and values of stock
options held by those officers that were outstanding at year end:
<TABLE>
Name Number of Shares Acquired on
Exercise Dollar Value Realized Number of Unexercised
Options At Year End Exercisable Number of Unexercised
Options At Year End Unexercisable Value of Unexercised
In-The-Money Options At Year End Exercisable Value of
Unexercised In-The-Money Options At Year End
Unexercisable
<S> <C> <C> <C> <C> <C> <C>
David M. Pomerance -- -- 180,500 100,000 $213,282 $140,625
Mitchel J. Laskey -- -- 150,000 100,000 $210,938 $140,625
Philip R. Kneeland -- -- -- 25,000 -- $ 35,156
Matthew P. Lawton -- -- -- 10,000 -- $ 14,063
</TABLE>
MANAGEMENT INCENTIVE COMPENSATION PLAN
The Company has a Management Incentive Compensation ("MIC")
Plan that is administered by the President and CEO under the
direction of the Compensation and Incentive Stock Option
Committee of the Board of Directors. Cash distributions may be
made annually and are based on the Company's earnings growth and
on each participating officer's contributions to the Company's
profits and other corporate goals. Distributions are allocated
from a pool, the amount of which is established by the Company's
Board of Directors annually at a target of net earnings
increases. Individual distributions from the pool are
determined by the Compensation and Incentive Stock Option Plan
Committee based on recommendations from the Company's President
and CEO.
With respect to 1996, the Board of Directors has established
$1,000,000 as the target of pre-tax net income before any
Management Incentive Bonus shall be paid, and that the maximum
bonuses to be paid for 1996 shall not be greater than twenty
(20%) percent of pre-tax net income.
No amounts were accrued or paid under the Plan based on the
Company's operating results in 1995.
EMPLOYMENT CONTRACTS
On July 7, 1994 and August 23, 1994, the Company entered into
Employment Agreements with David M. Pomerance, CEO and Mitchel
J. Laskey, President and COO, respectively. Both are three (3)
year agreements and shall automatically renew for two (2)
successive one-year periods unless earlier terminated upon
delivery of written notice by either party not less than sixty
(60) days prior to end of the initial, or renewal term, as the
case may be. Both provide for a base salary of $150,000 per
annum and are to be reviewed annually by the Board of Directors.
On March 4, 1996 the Board of Directors approved an increase in
the base salary of both Messrs. Pomerance and Laskey to $187,500
effective March 1, 1996. If either Employment Agreement is
terminated without cause, one year of the employees annual base
salary as of the date of termination, in addition to all other
benefits and other compensation, if any, shall accrue and be
paid. Both agreements contain a covenant not to compete
extending for two years after termination. The agreements also
allow for participation in the Company's Employee Benefit Plans.
The Compensation Committee believes that the CEO's and COO's
base salaries should be competitive within the Company's peer
group and that the CEO's and COO's total compensation should be
dependent upon three factors: 1) changes in the Consumer Price
Index, 2) increases in shareholder value, and 3) the Company's
overall financial performance with special consideration given
to earnings growth. The Committee believes that the
compensation of the CEO and COO should be most heavily
influenced by the Company's financial performance.
<PAGE>
OTHER COMPENSATION PLANS
1983 Incentive Stock Option Plan
The Company had an Incentive Stock Option Plan which expired
March 1993 ("1983 Plan"). The 1983 Plan allowed the Company, at
its discretion, as determined by a three member Stock Option
Plan Committee appointed from the members of the Board of
Directors who were not eligible to participate in the 1983 Plan,
to grant incentive stock options to employees determined by the
Committee, for the purchase of Common Stock of the Company.
Under the 1983 Plan as of March 20, 1996, there were unexpired
options outstanding and unexercised for shares totaling 19,000.
As of March 20, 1996, the market value for the shares underlying
these unexercised options was $43,938. The total proceeds the
Company would realize upon the exercise of all 1983 Plan options
outstanding at March 20, 1996, was $30,310. Options may be
exercised for periods up to ten years from date of grant or, in
the case of holders of 10% or more of the Company's Common
Stock, five years from date of grant. The expiration of the
1983 Plan does not effect the right of the holders to exercise
unexpired options under the Plan. The exercise price of the
options granted under the Plan may not be less than 100% of the
fair market value of the Company's Common Stock on the grant
date or, in the case of holders of 10% or more of the Company's
Common Stock, 110% of the fair market value of the Company's
Common Stock at grant date. Options may be exercised to acquire
40% of the shares subject to the option after one year, 30%
after two years and 30% after three years.
1993 Incentive Stock Option Plan
The Company adopted a similar Incentive Stock Option Plan in
1993 ("1993 Plan"). As of March 20, 1996, there were unexpired
options outstanding and unexercised for shares totaling 352,050
under the 1993 Plan. As of March 20, 1996, the market value for
the shares underlying these unexercised options was $814,116.
The total proceeds the Company would realize upon the exercise
of all 1993 Plan options outstanding at March 20, 1996, was
$562,348. The terms and vesting schedule of options granted
under both the 1983 and 1993 Plans are the same.
Options granted under both Plans are "Incentive Stock Options"
pursuant to Section 422A of the Internal Revenue Code.
Employees do not recognize income at the time of the grant or
exercise of an option. Employees will recognize capital gain or
loss, as the case may be, at the time of the subsequent sale of
the Common Stock issued upon the exercise of the option. The
Company will not recognize income at either the time of the
option grant or at the time of the exercise.
All full-time permanent Company employees are/were eligible to
participate under both Plans. Options may be exercised either
by payment of cash, or, at the discretion of the Committee, by
shares of the Company's Common Stock.
Director and Officer Stock Warrant and Option Plan
The Company adopted the Director and Officer Stock Warrant and
Option Plan in 1993 for the issuance of stock purchase warrants
and stock options to directors, officers and key management
employees of the Company. Grants under this Plan are made under
the direction of the Company's Compensation Committee. The
purpose of the Plan is to attract and retain talented directors,
officers and key management employees of the Company.
The Company has reserved 250,000 shares of its Common Stock for
issuance upon the exercise of warrants and options granted under
the Plan. As of March 20, 1996, there were unexpired warrants
and options outstanding and unexercised for shares totaling
106,000. The market value for shares underlying these warrants
and options was $245,125 as of March 20, 1996. The total
proceeds the Company would receive upon the exercise of these
warrants and options was $226,736. Under the Plan, warrants to
directors are to be issued with an exercise price equal to the
average of the closing bid and ask prices of the Company's
Common Stock on the date of issuance. Options to employees and
officers are to be issued with an exercise price of no less than
85% of the fair market value of the Company's Common Stock on
the date of issuance.
This Plan does not qualify under Section 401(a) of the Internal
Revenue Code of 1986, as amended. As such, warrant holders and
optionees will not realize income at the time of the warrant or
option grant. They will recognize ordinary compensation income
at the time of the exercise of the warrant or option to the
extent of the difference of the exercise price and the fair
market value of the underlying Common Stock at the time of
exercise. The Company is obligated to withhold employment taxes
on this income at the time of exercise. Warrant holders and
optionees will recognize either a capital gain or capital loss
at the time of the eventual sale of the Common Stock received on
exercise, computed as the difference between the sale price of
the Common Stock and its fair market value on the exercise date.
<PAGE>
Employee Stock Purchase Plan
The Company adopted the Employee Stock Purchase Plan in 1993
for the purpose of encouraging full-time employees to become
shareholders in the Company. The Company has reserved 200,000
shares of its Common Stock for issuance pursuant to purchases
under this Plan. Under this Plan as of March 20, 1996, 36,640
shares have been issued generating proceeds to the Company of
$37,999.
The price for stock purchased under this Plan will be the
lesser of 85% of the average bid and ask prices of the Company's
Common Stock at the beginning of and at the end of each six
month purchase period. Employees pay for the shares through
payroll deductions. This Plan qualifies for favorable tax
treatment to employees under Sections 421 and 423 of the
Internal Revenue Code.
STOCK PERFORMANCE
The following chart compares the cumulative total shareholder
return on the Company's Common Shares based on the closing bid
price of the Company's Common Stock for the last five years
("Company Index"), with the cumulative total returns for the
CRSP total return index for the NASDAQ Stockmarket-U.S.
Companies Index ("Market Index") and the CRSP NASDAQ Computer
and Data Processing Services Stocks Index ("Peer Group") over
the same period. The comparison assumes $100 invested in the
Company's Common Stock and in each of the foregoing indices and
assumes reinvestment of dividends, if any. The stock price
performance shown on the chart is not necessarily indicative of
future performance.
<PAGE>
Proposal Number Two (2) - Certifying Independent Accountants
An affirmative vote of at least a majority of the votes cast on
this proposal are required for approval. The Board of Directors
is recommending to the Company shareholders a vote "FOR"
Proposal Number Two (2) to engage KPMG Peat Marwick, LLP as
independent public accountants for the Company for the fiscal
year ending December 31, 1996.
Proposal Number Three (3) - Change of State of Incorporation
The Board of Directors proposes to change the Company's state of
incorporation from Nebraska to Florida. The Board of Directors
has proposed this change due to the Company's relocation of substantially
all operations to Florida and current management's familiarity with
Florida law. The Company has found that as a Nebraska corporation, the
Company incurs unnecessary and duplicative legal expenses in having its Florida
legal counsel consult with Nebraska legal counsel or research
Nebraska corporate law. Moreover, Nebraska has adopted a new corporate law
statute effective January 1, 1996 and has not developed a body of decisional
case law thereunder to provide comfort to the Company on interpretations
of the new statute.
The reincorporation would be effected by the Company forming a
Florida corporation ("DHT Florida"), wholly-owned by the
Company, into which the Company would be merged pursuant to
Nebraska and Florida law (the "Merger"). The Articles of
Incorporation of DHT Florida will provide for the same capital
structure as exists under the Articles of Incorporation, as
amended, of the Company.
Upon the effectiveness of the Merger, each outstanding share of
the Common Stock of the Company will be converted into one share
of common stock of DHT Florida ("DHT Florida Common Stock").
Each outstanding share of Company Series A Preferred Stock will
be converted into one (1) share of DHT Florida Series A
Preferred Stock and each outstanding share of Company Series B
Preferred Stock will be converted into one (1) share of DHT
Florida Series B Preferred Stock. The rights, preferences and
privileges of DHT Florida Series A and Series B Preferred Stock,
respectively, shall be the same as the rights, preferences and
privileges of Company Series A and Series B Preferred Stock,
respectively. Each outstanding certificate representing shares
of Company Common Stock or Series A or Series B Preferred Stock
will continue to represent the same number of shares of DHT
Florida Common Stock and Series A or Series B Preferred Stock,
respectively. Thus, it will not be necessary for stockholders
of the Company to exchange their existing stock certificates for
stock certificates of DHT Florida. It is anticipated that DHT
Florida Common Stock will be listed on NASDAQ without
interruption and that delivery of existing stock certificates of
the Company will constitute "good delivery" of share of DHT
Florida after the Merger.
After the Merger, the daily business operations of the Company
will continue unchanged, with its principal executive offices
at the same location in Maitland, Florida. The Board of
Directors of DHT Florida will consist of those persons elected
to the Board of Directors of the Company at the Annual Meeting.
The individuals serving as executive officers of the Company
immediately prior to the Merger will serve as executive officers
of DHT Florida after the Merger.
Pursuant to the Merger Agreement, each right to purchase or
acquire a share of Company Common Stock outstanding immediately
prior to the Merger either through warrants, options or
otherwise will become the right to purchase or acquire a share
of DHT Florida Common Stock upon the same terms and conditions
as existed immediately prior to the effective time of the Merger.
Principal Differences Between Florida and Nebraska Corporation
Law
Action by Shareholders Without a Meeting.
If the Company is reincorporated in Florida, corporate action
requiring shareholder approval may be approved pursuant to a
written action by a majority of the Company's shareholders,
whereas a Nebraska corporation may take action without a meeting
only if the action is taken by all the shareholders entitled to
vote on the action. Accordingly, if the Company's state of
incorporation is changed to Florida a majority of the Company's
shareholders will be able to take action without calling a
shareholders' meeting. However, as a corporation registered
pursuant to Section 12 of the Securities Exchange Act of 1934,
the Company will be required to deliver to its shareholders and
Information Statement whenever any corporate action is proposed
to be approved by written action.
<PAGE>
Shareholder Vote.
If the Company is reincorporated in Florida certain corporate
actions requiring shareholder vote must be approved by a
majority of the votes entitled to be cast, whereas for a
Nebraska corporation similar actions requiring shareholder vote
must be approved by a two-thirds (2/3) majority of the votes
entitled to be cast. For example, to amend articles of
incorporation, to approve a plan of merger, to sell assets other
than in the regular course of business or to dissolve with
respect to a Nebraska corporation, unless the Business
Corporation Act of Nebraska, the articles of incorporation or
board of directors requires a greater vote, such actions must be
approved by a two-thirds (2/3) majority of votes entitled to be
cast, however, with respect to a Florida corporation, unless the
Florida Business Corporation Act, the Articles of Incorporation
or board of directors requires a greater vote, such actions must
be approved by a majority of votes entitled to be cast.
Anti-Takeover Laws.
If the Company is reincorporated in Florida certain
anti-takeover laws will apply in certain instances. The
affiliated transactions statute, F.S. 607.0901, will impose
limitations upon the exercise of corporate control, directly or
indirectly, by a beneficial owner of more than ten (10%) percent
of the Company's outstanding voting stock (an "interested
shareholder"). The Company's "disinterested directors", or
supermajority of the Company's stockholders (other than the
interested shareholder and related parties) are required to
approve certain business combinations and corporate transactions
with an interested shareholder ("affiliated transaction"),
unless a statutory exemption applies or the Company opts out of
the statute. The control share acquisition statute, F.S.
607.0902, will deny corporate control to an acquiror of control
shares by extinguishing the voting rights of shares of the
Company's stock acquired in a "control share acquisition."
Those voting rights may be reinstated by a vote of the
shareholders. The acquisition of shares is not directly
affected, only the voting rights attendant to control shares.
Dissenting Shareholders Rights
Pursuant to Sections 21-20, 137 through 21-20, 150 of the
Business Corporation Act of Nebraska, shareholders of the
Company have the right to dissent from the Company's change of
incorporation from Nebraska to Florida and obtain payment of the
fair value of his or her shares. Such rights and the procedures
for protection of such rights are attached to this Proxy
Statement as Exhibit "A". Any shareholder wishing to dissent
and obtain payment for his or her shares must (a) deliver to the
Company before the vote is taken written notice of his or her
intent to demand payment for his or her shares if the proposed
action is effectuated, and (b) not vote his or her shares in
favor of the proposed action. A shareholder who fails in either
respect will lose his or her right to payment.
All notices to the Company regarding the exercise of dissenters'
rights must be received by the Company prior to the vote on the
reincorporation, either by mail, hand delivery or otherwise.
The Company will accept written notice of dissent at its offices
located at 101 Southhall Lane, Suite 210, Maitland, Florida
32751 up to the close of business the day before the Annual
Meeting and by hand delivery at the Annual Meeting, up to the
time the vote is taken.
In the event that one or more of the Company's shareholders
dissent, the Board of Directors reserves the right at any time
before the vote is taken to cause the Company to remain a
Nebraska corporation, thereby eliminating the dissenters' rights
described above.
<PAGE>
EXHIBIT A
DISSENTERS' RIGHTS
21-20,137. Dissenters' rights; terms, defined. For purposes
of sections 21-20,137 to 21-20,150:
(1) Beneficial shareholder shall mean the person who is a
beneficial owner of shares held in a voting trust or by a
nominee as the record shareholder;
(2) Corporation shall mean the issuer of the shares held by a
dissenter before the corporate action or the surviving or
acquiring corporation by merger or share exchange of that issuer;
(3) Dissenter shall mean a shareholder who is entitled to
dissent from corporate action under section 21-20,138 and who
exercises that right when and in the manner required by sections
21-20,140 to 21-20,148;
(4) Fair value, with respect to a dissenter's shares, shall
mean the value of the shares immediately before the effectuation
of the corporate action to which the dissenter objects,
excluding any appreciation or depreciation in anticipation of
the corporate action unless exclusion would be inequitable;
(5) Interest shall mean interest from the effective date of the
corporate action until the date of payment at the rate specified
in section 45-104, as such rate may from time to time be
adjusted by the Legislature;
(6) Record shareholder shall mean the person in whose name
shares are registered in the records of a corporation or the
beneficial shareholder to the extent of the rights granted by a
nominee certificate on file with a corporation; and
(7) Shareholder shall mean the record shareholder or the
beneficial shareholder.
Source: Laws 1995, LB 109, Section 137.
Operative date January 1, 1996.
21-20,138. Right to dissent. (1) A shareholder shall be
entitled to dissent from, and obtain payment of the fair value
of his or her shares in the event of, any of the following
corporate actions:
(a) Consummation of a plan of merger to which the corporation
is a party:
(i) If shareholder approval is required for the merger by
section 21-20,130 or the articles of incorporation and the
shareholder is entitled to vote on the merger; or
(ii) If the corporation is a subsidiary that is merged with its
parent under section 21-20,131;
(b) Consummation of a plan of share exchange to which the
corporation is a party as the corporation whose shares will be
acquired, if the shareholder is entitled to vote on the plan;
(c) Consummation of a sale or exchange of all, or substantially
all, of the property of the corporation other than in the usual
and regular course of business if the shareholder is entitled to
vote on the sale or exchange, including a sale in dissolution,
but not including a sale pursuant to court order or a sale for
cash pursuant to a plan by which all or substantially all of the
net proceeds of the sale will be distributed to the shareholders
within one year after the date of sale;
(d) An amendment of the articles of incorporation that
materially and adversely affects rights in respect of a
dissenter's shares because it:
(i) Alters or abolishes a preferential right of the shares;
(ii) Creates, alters, or abolishes a right in respect of
redemption including a provision respecting a sinking fund for
the redemption or repurchase of the shares;
(iii) Alters or abolishes a preemptive right of the holder of
the shares to acquire shares or other securities;
(iv) Excludes or limits the right of the shares to vote on any
matter, or to cumulate votes, other than a limitation by
dilution through issuance of shares or other securities with
similar voting rights; or
(v) Reduces the number of shares owned by the shareholder to a
fraction of a share if the fractional share so created is to be
acquired for cash under section 21-2038; or
(e) Any corporate action taken pursuant to a shareholder vote
to the extent the articles of incorporation, the bylaws, or a
resolution of the board of directors provides that voting or
nonvoting shareholders are entitled to dissent and obtain
payment for their shares.
(2) A shareholder entitled to dissent and obtain payment for
his or her shares under sections 21-20,137 to 21-20,150 may not
challenge the corporate action creating his or her entitlement
unless the action is unlawful or fraudulent with respect to the
shareholder or the corporation.
(3) The right to dissent and obtain payment under sections
21-20,137 to 21-20,150 shall not apply to the shareholders of a
bank, trust company, stock-owned savings and loan association,
industrial loan and investment company, or the holding company
of any such bank, trust company, stock-owned savings and loan
association, or industrial loan and investment company.
Source: Laws 1995, LB 109, Section 138.
Operative date January 1, 1996
21-20,139. Dissent by nominees and beneficial owners. (1) A
record shareholder may assert dissenters' rights as to fewer
than all the shares registered in his or her name only if he or
she dissents with respect to all shares beneficially owned by
any one person and notifies the corporation in writing of the
name and address of each person on whose behalf he or she
asserts
<PAGE>
dissenters' rights. The rights of a partial dissenter
under this subsection shall be determined as if the shares as to
which he or she dissents and his or her other shares were
registered in the names of different shareholders.
(2) A beneficial shareholder may assert dissenters' rights as
to shares held on his or her behalf only if:
(a) He or she submits to the corporation the record
shareholder's written consent to the dissent not later than the
time the beneficial shareholder asserts dissenters' rights; and
(b) He or she does so with respect to all shares of which he or
she is the beneficial shareholder or over which he or she has
power to direct the vote.
Source: Laws 1995, LB 109, Secton 139.
Operative date January 1, 1996
21-20,140. Notice of dissenters' rights. (1) If proposed
corporate action creating dissenters' rights under section
21-20,138 is submitted to a vote at a shareholders' meeting, the
meeting notice shall state that shareholders are or may be
entitled to assert dissenters' rights under sections 21-20,137
to 21-20,150 and be accompanied by a copy of such sections.
(2) If corporate action creating dissenters' rights under
section 21-20,138 is taken without a vote of shareholders, the
corporation shall notify in writing all shareholders entitled to
assert dissenters' rights that the action was taken and send
those shareholders the dissenters' notice described in section
21-20,142.
Source: Laws 1995, LB 109, Section 140.
Operative date January 1, 1996
21-20,141. Dissenters' rights; notice of intent to demand
payment. (1) If proposed corporate action creating dissenters'
rights under section 21-20,138 is submitted to a vote at a
shareholders' meeting, a shareholder who wishes to assert
dissenters' rights (a) shall deliver to the corporation before
the vote is taken a written notice of his or her intent to
demand payment for his or her shares if the proposed action is
effectuated and (b) shall not vote his or her shares in favor of
the proposed action.
(2) A shareholder who does not satisfy the requirements of
subsection (1) of this section shall not be entitled to payment
for his or her shares under sections 21-20,137 to 21-20,150.
Source: Laws 1995, LB 109, Section 141.
Operative date January 1, 1996
21-20,142. Dissenters' notice. (1) If proposed corporate
action creating dissenters' rights under section 21-20,138 is
authorized at a shareholders' meeting, the corporation shall
deliver a written dissenters' notice to all shareholders who
satisfied the requirements of section 21-20,141.
(2) The dissenters' notice shall be sent no later than ten days
after the corporate action was taken and shall:
(a) State where the payment demand shall be sent and where and
when certificates for certificated shares shall be deposited;
(b) Inform holders of uncertificated shares to what extent
transfer of the shares will be restricted after the payment
demand is received;
(c) Supply a form for demanding payment that includes the date
of the first announcement to news media or to shareholders of
the terms of the proposed corporate action and requires that the
person asserting dissenters' rights certify whether or not he or
she acquired beneficial ownership of the shares before that date;
(d) Set a date by which the corporation shall receive the
payment demand which date may not be fewer than thirty nor more
than sixty days after the date the notice required by subsection
(1) of this section is delivered; and
(e) Be accompanied by a copy of sections 21-20,137 to 21-20,150.
Source: Laws 1995, LB 109, Section 142.
Operative date January 1, 1996
21-20,143. Dissenters' rights; duty to demand payment. (1) A
shareholder who was sent a dissenters' notice described in
section 21-20,142 shall demand payment, certify whether he or
she acquired beneficial ownership of the shares before the date
required to be set forth in the dissenters' notice pursuant to
subdivision (2)(c) of section 21-20,142, and deposit his or her
certificates in accordance with the terms of the notice.
(2) The shareholder who demands payment and deposits his or her
shares under subsection (1) of this section shall retain all
other rights of a shareholder until such rights are canceled or
modified by the taking of the proposed corporate action.
(3) A shareholder who does not demand payment or does not
deposit his or her share certificates where required, each by
the date set in the dissenters' notice, shall not be entitled to
payment for his or her shares under sections 21-20,137 to
21-20,150.
Source: Laws 1995, LB 109, Section 143.
Operative date January 1, 1996
21-20,144. Dissenters' rights; share restrictions. (1) The
corporation may restrict the transfer of uncertificated shares
from the date the demand for their payment is received until the
proposed corporate action is taken or the restrictions are
released under section 21-20,146.
(2) The person for whom dissenters rights are asserted as to
uncertificated shares shall retain all other rights of a
shareholder until such rights are canceled or modified by the
taking of the proposed corporate action.
Source: Laws 1995, LB 109, Section 144.
Operative date January 1, 1996
21-20,145. Dissenters' rights; payment. (1) Except as
provided in section 21-20,147, as soon as the proposed corporate
action is taken, or upon receipt of a payment demand, the
corporation shall pay each dissenter who complied with section
21-20,143 the amount the corporation estimates to be the fair
value of his or her shares, plus accrued interest.
<PAGE>
(2) The payment shall be accompanied by:
(a) The corporation's balance sheet as of the end of a fiscal
year ending not more than sixteen months before the date of
payment, an income statement for that year, a statement of
changes in shareholders' equity for that year, and the latest
available interim financial statements, if any;
(b) A statement of the corporation's estimate of the fair value
of the shares;
(c) An explanation of how the interest was calculated;
(d) A statement of the dissenter's right to demand payment
under section 21-20,148; and
(e) A copy of section 21-21,137 to 21-20,150.
Source: Laws 1995, LB 109, Section 145
Operative date January 1, 1996.
21-20,146. Dissenters' rights; failure to take action. (1)
If the corporation does not take the proposed action within
sixty days after the date set for demanding payment and
depositing share certificates, the corporation shall return the
deposited certificates and release the transfer restrictions
imposed on uncertificated shares.
(2) If, after returning deposited certificates and releasing
transfer restrictions, the corporation takes the proposed
action, it shall send a new dissenter's notice under section
21-20,142 and repeat the payment demand procedure.
Source: Laws 1995, LB 109, Section 146.
Operative date January 1, 1996.
21-20,147. Dissenters' rights; after-acquired shares. (1) A
corporation may elect to withhold payment required by section
21-20,145 from a dissenter unless he or she was the beneficial
shareholder before the date set forth in the dissenters' notice
as the date of the first announcement to news media or to
shareholders of the terms of the proposed corporate action.
(2) To the extent the corporation elects to withhold payment
under subsection (1) of this section after taking the proposed
corporate action, it shall estimate the fair value of the
shares, plus accrued interest and shall pay this amount to each
dissenter who agrees to accept it in full satisfaction of his or
her demand. The corporation shall send with its offer a
statement of its estimate of the fair value of the shares, an
explanation of how the interest was calculated, and a statement
of the dissenter's rights to demand payment under section
21-20,148.
Source: Laws 1995, LB 109, Section 147
Operative date January 1, 1996
21-20,148. Dissenters' rights; procedure if shareholder
dissatisfied with payment or offer. (1) A dissenter may notify
the corporation in writing of his or her own estimate of the
fair value of his or her shares and amount of interest due, and
demand payment of his or her estimate, less any payment under
section 21-20,145, or reject the corporation's offer under
section 21-20,147 and demand payment of the f air value of his
or her shares and interest due if;
(a) The dissenter believes that the amount paid under section
21-20,145 or offered under section 21-20,147 is less than the
fair value of his or her shares or that the interest due is
incorrectly calculated;
(b) The corporation fails to make payment under section
21-20,145 within sixty days after the date set for demanding
payment; or
(c) The corporation, having failed to take the proposed action,
does not return the deposited certificates or release the
transfer restrictions imposed on uncertificated shares within
sixty days after the date set for demanding payment.
(2) A dissenter waives his or her right to demand payment under
this section unless he or she notifies the corporation of his
or her demand in writing under subsection (1) of this section
within thirty days after the corporation made or offered
payment for his or her shares.
Source: Laws 1995, LB 109, Section 148.
Operative date January 1, 1996.
21-20,149. Dissenters' rights; court action, (1) If a demand
for payment under section 21-20,148 remains unsettled, the
corporation shall commence a proceeding within sixty days after
receiving the payment demand and petition the court to determine
the fair value of the shares and accrued interest. If the
corporation does not commence the proceeding within the
sixty-day period, it shall pay each dissenter whose demand
remains unsettled the amount demanded.
(2) The corporation shall commence the proceeding in the
district court of the county where a corporation's principal
office, or, if none in this state , its registered office, is
located. If the corporation is a foreign corporation without a
registered office in this state, it shall commence the
proceeding in the district court of the county in this state
where the registered office of the domestic corporation merged
with or whose shares were acquired by the foreign corporation
was located.
(3) The corporation shall make all dissenters, whether or not
residents of this state, whose demands remain unsettled, parties
to the proceeding as in an action against their shares and all
parties shall be served with a copy of the petition.
Nonresidents may be served by registered or certified mail or by
publication as provided by law.
(4) The jurisdiction of the court in which the proceeding is
commenced under subsection (2) of this section shall be plenary
and exclusive. The court may appoint one or more persons as
appraisers to receive evidence and recommend decision on the
question of fair value. Appraisers shall have the powers
described in the order appointing them or in any amendment to
such order. The dissenters shall be entitled to the same
discovery rights as parties in other civil proceedings.
(5) Each dissenter made a party to the proceeding shall be
entitled to judgment (a) for the amount, if any, by which the
court finds the fair value of his or her shares, plus interest,
exceeds the amount paid by the corporation or (b) for the fair
value, plus
<PAGE>
accrued interest, of his or her after-acquired
shares for which the corporation elected to withhold payment
under section 21-20,147.
Source: Laws 1995, LB 109, Section 149
Operative date January 1, 1996.
21-20, 150. Dissenters' rights; court costs and attorney's
fees. (1) The court in an appraisal proceeding commenced under
section 21-20,149 shall determine all costs of the proceeding,
including the reasonable compensation and expenses of appraisers
appionted by the court. The court shall assess the costs
against the corporation, except that the court may assess costs
against all or some of the dissenters, in amounts the court
finds equitable, to the extent the court finds the dissenters
acted arbitrarily, vexatiously, or not in good faith in
demanding payment under section 21-20,148.
(2) The court may also assess the attorney's fees and expenses
and the fees and expenses of experts for the respective parties
in amounts the court finds equitable:
(a) Against the corporation and in favor of any or all
dissenters if the court finds the corporation did not
substantially comply with the requirements of sections 21-20,140
to 21-20,148; or
(b) Against either the corporation or a dissenter, in favor of
any other party, if the court finds that the party against
whom the fees and expenses are assessed acted arbitrarily,
vexatiously, or not in good faith with respect to the rights
provided by sections 21-20,137 to 21-20,150.
(3) If the court finds that the services of counsel for any
dissenter were of substantial benefit to other dissenters
similarly situated and that the fees for those services should
not be assessed against the corporation, the court may award to
counsel reasonable fees to be paid out of the amounts awarded to
the dissenters who were benefited.
Source: Laws 1995, LB 109, Section 150.
Operative date January 1, 1996.
<PAGE>
DYNAMIC HEALTHCARE TECHNOLOGIES, INC.
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints MITCHEL J. LASKEY and THOMAS J.
MARTINSON, or either of them, as Proxies, each with the power to
appoint his substitute, and hereby authorizes them to represent
and to vote, as designated below, all the shares of Common Stock
and/or Series B Preferred Stock of Dynamic Healthcare
Technologies, Inc. held by record by the undersigned on April
10, 1996, at the annual meeting of shareholders to be held on
May 21, 1996, or any adjournment thereof.
1. ELECTION OF DIRECTORS
____ FOR all nominees listed below ____ WITHHOLD AUTHORITY
(except as marked to the contrary below) to vote for all
nominees listed
below
INSTRUCTION: To withhold authority to vote for any
individual nominee, write that nominee's name in the space
provided below.
JERRY L. CARSON; THOMAS J. MARTINSON; DAVID M. POMERANCE;
MITCHEL J. LASKEY; DANIEL P. RAYNOR; BRET R. MAXWELL;
RICHARD W. TRUELICK
2. To vote on the proposal of the Board of Directors that KPMG
Peat Marwick, LLP, independent public accountants, be engaged as
auditors for the Company for the fiscal year ending December 31,
1996.
____ FOR ____ AGAINST ____ABSTAIN
3. To vote on the proposal to reincorporate the Company in the state
of Florida by the described subsidiary merger.
____ FOR ____ AGAINST ____ ABSTAIN
4. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the meeting.
This proxy when properly executed will be voted in the manner
directed by the undersigned shareholder. If no direction is
made, this proxy will be voted for Proposals 1 through 3.
The undersigned hereby revokes any proxies heretofore given by
him and confirms all that the Proxies may lawfully do by virtue
hereof.
Dated: __________________, 1995 ____________________________
Signature of Shareholder
PLEASE MARK, DATE, SIGN AND RETURN PROMPTLY. Please sign name
IF YOUR ADDRESS OR ZIP CODE IS INCORRECT, exactly as shown
PLEASE CORRECT THE SAME BEFORE RETURNING. hereon. Executors,
Administrators,
Trustees, etc.
should give titles
as such. If
Shareholder is a
corporation, sign
full corporate name
by duly authorized
officer.
