SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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:
[ ] 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 Materials Pursuant to Section 240.14a-11(c)
or Section 240.14a-12
HEALTHPLEX, INC.
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(Name of Registrant as Specified in its Charter)
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(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)(4) and 0-11.
1) Title of each class of securities to which
transaction applies:
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2) Aggregate number of securities to which transaction
applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
amount on which the filing fee is calculated and state
how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] 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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2) Form, Schedule or Registration Statement No:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
HEALTHPLEX, INC.
60 CHARLES LINDBERGH BOULEVARD
UNIONDALE, NEW YORK 11553
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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An Annual Meeting of Stockholders of Healthplex, Inc. (the "Company")
will be held at Brandywine Suites Hotel, 707 N. King Street, Wilmington,
Delaware, on July 1, 1997, at 12:45 P.M., New York time, for the following
purposes:
1. To elect six directors to the Board of Directors;
2. To ratify the appointment of Libero & Kappel as independent
auditors for the fiscal year ending December 31, 1997; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on May 23, 1997
will be entitled to vote at the meeting. A list of such stockholders will
be available for examination by any stockholder for any purpose germane to
the meeting, during normal business hours, at the principal office of the
Company, 60 Charles Lindbergh Boulevard, Uniondale, New York, for a period
of ten days prior to the meeting.
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING IN PERSON, WE
URGE YOU TO PLEASE MARK, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT IN
THE ENVELOPE PROVIDED FOR THAT PURPOSE.
By Order of the Board of Directors,
/s/ Bruce H. Safran
BRUCE H. SAFRAN,
Secretary
May 27, 1997
<PAGE>
HEALTHPLEX, INC.
60 CHARLES LINDBERGH BOULEVARD
UNIONDALE, NEW YORK 11553
TEL: (516) 794-3000
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PROXY STATEMENT
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ANNUAL MEETING OF STOCKHOLDERS
JULY 1, 1997
INTRODUCTION
The Board of Directors of Healthplex, Inc. (the "Company") solicits your
proxy, in the form enclosed, for use at the annual meeting of stockholders
to be held on July 1, 1997 and any adjournment(s) thereof (the "Meeting").
This Proxy Statement and the accompanying Notice of Annual Meeting and Form
of Proxy are being mailed to stockholders on or about May 27, 1997.
The Board of Directors has fixed May 23, 1997 as the record date (the
"Record Date") for the determination of stockholders entitled to vote at
the Meeting. At the close of business on the Record Date there were
outstanding and entitled to vote 3,585,082 shares of Common Stock of the
Company, par value $.001 per share ("Common Stock"). Each share is
entitled to one vote. The Common Stock is the only outstanding class of
securities of the Company. A majority of the outstanding shares will
constitute a quorum at the meeting. Abstentions and broker non-votes are
counted for purposes of determining the presence or absence of a quorum for
the transaction of business. Abstentions are counted in tabulations of the
votes cast on proposals presented to stockholders for purposes of
determining whether a proposal has been approved, whereas broker non-votes
are not counted for purposes of determining whether a proposal has been
approved.
Any proxy may be revoked at any time before it is exercised by delivery
of a written instrument of revocation or a later dated proxy to the
principal executive office of the Company or, while the Meeting is in
session, to the Secretary of the Meeting, without, however, affecting any
vote previously taken. The presence of a stockholder at the Meeting will
not operate to revoke his proxy. The casting of a ballot by a stockholder
who is present at the Meeting will, however, revoke his proxy but then
solely as to the matters on which the ballot is cast and not as to any
matters on which he does not cast a ballot or as to matters previously
voted upon.
Proxies received by management will be voted at the Meeting or any
adjournment thereof as specified therein by the person giving the Proxy.
TO THE EXTENT NO CHOICE IS SPECIFIED, THE PROXY WILL BE VOTED FOR
MANAGEMENT'S PROPOSALS. All of management's proposals have been
unanimously approved by the Board of Directors.
The expense of soliciting proxies, including the cost of preparing,
assembling and mailing this proxy material to stockholders, will be borne
by the Company. Directors, officers and employees may solicit proxies
personally or by telephone, without additional salary or compensation to
them. Banks, brokers, custodians, nominees and fiduciaries will be
requested to forward the proxy soliciting materials to beneficial owners,
and the Company will reimburse such persons for reasonable out-of-pocket
expenses incurred by them in this connection.
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<PAGE>
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
There are six directors to be elected. It is intended that the names of
the persons indicated in the following table will be placed in nomination,
and the persons named in the enclosed proxy will vote for their election.
In case any nominee becomes unavailable for election to the Board of
Directors for any reason not presently known or contemplated, the proxy
holders will have discretionary authority in that instance to vote the
proxy for a substitute. To be elected, any nominee must receive a
plurality of the votes cast for his position. Each nominee elected will
serve as a director for the ensuing year and until his successor shall have
been elected and qualified.
The following six nominees are proposed to be elected directors at the
Meeting.
SERVED
AS
DIRECTOR
NAME PRINCIPAL OCCUPATION AGE SINCE
---- -------------------- --- --------
Stephen J. Cuchel Chairman of the Board, Co-Chief 58 1984
Executive Officer and a Director
Martin Kane . . . President, Co-Chief Executive 57 1984
Officer and a Director
Bruce H. Safran . Vice-President, Secretary and a 47 1984
Director
George Kane . . . Vice-President, Treasurer and a 53 1984
Director
Philip J. Rizzuto Vice President of Management 53 1990
Information Systems and a Director
Douglas L. King . Director 55 1986
CERTAIN INFORMATION CONCERNING NOMINEES AND EXECUTIVE OFFICERS
DR. STEPHEN J. CUCHEL has been Chairman of the Board, Co-Chief Executive
Officer and a Director of the Company for more than the past five years.
He is a director of International Healthcare Services, Inc. ("IHS"),
President of the American Dental Research Foundation, a partner in a group
dental practice with Drs. George Kane and Martin Kane, Assistant Professor
at New York University Medical Center and a lecturer at C.W. Post Long
Island University. He is a member of the 9th Dental Society, North Eastern
Conference of Health, Welfare and Pension Plans. He is also a member of
the board of directors of the Health Services Administration, Nassau and
Suffolk counties. Dr. Cuchel received a B.S. from Union College in 1960
and a D.D.S. from New York University College of Dentistry in 1964. He has
also completed post-graduate training at New York Institute of Clinical
Oral Pathology, and a residency at Long Island College Hospital in
Anesthesiology and Dentistry for Handicapped Children.
DR. MARTIN KANE has been President, Co-Chief Executive Officer and a
Director of the Company for more than the past five years. He is also a
director of IHS. He, with Drs. George Kane and Stephen Cuchel, operates a
group dental practice from four private offices in New York City and
environs. Between 1964 and 1976 he and Dr. Cuchel established various
dental offices in the New York metropolitan area. Dr. Kane received a B.S.
from City College of New York in 1960 and a D.D.S. from New York University
College of Dentistry in 1964. He is a member of the American Dental
Association, SED Professional Fraternity for Continuing Education,
Conference of Oral Medicine, North Eastern Conference of Health, Welfare
and Pension Funds and is dental care adviser to Local 1125 Retail Menswear
Union.
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<PAGE>
DR. BRUCE H. SAFRAN has been Vice-President, Secretary and a Director of
the Company for more than the past five years. His duties include
professional relations, plan design and product development. He is also
President and a director of IHS (having served since 1981). Dr. Safran is
licensed to practice dentistry in New York and New Jersey, was a solo
practitioner between 1974 and 1982, and occasionally serves as a dental
consultant to private dental offices. Dr. Safran attended Ohio State
University between 1967 and 1970, received a D.D.S. in 1974 from the
University of Maryland and an M.B.A. in 1989 from the University of New
Haven. He is a member of the American, New York State and Nassau County
Dental Societies, as well as the National Association of Dental Plans, the
Self-Insurance Institute of America, the Association of Managed Health Care
Organizations and the American Health Information Management Association.
DR. GEORGE KANE has been a Vice-President and a Director of the Company
since July 1984, and has been Treasurer of the Company since February 1988.
He is a director and Vice-President of IHS. Together with his brother,
Martin Kane, and Stephen J. Cuchel, Dr. Kane operates a group dental
practice from four offices in New York City and environs. He is a member
of the American Dental Association, SED Professional Fraternity for
Continuing Education, Academy of General Dentistry, American Endodontic
Society, American Society of Preventive Dentistry and Yonkers, New York
Chamber of Commerce. He received his B.A. from The State University,
Rutgers, New Jersey in 1965 and a D.D.S. from New York University College
of Dentistry in 1969.
PHILIP J. RIZZUTO has been a Director of the Company and Vice-President
of Management Information Systems since March 1990. He was a Director,
Chief Executive Officer, Secretary and Treasurer of the Healthplex Computer
Group from December 1987 until July 31, 1993. His duties include providing
technical support services for in-house computer and imaging systems and
providing market support for all products. Prior thereto, and at various
times since 1982, he was a self-employed consultant to the Company and to
other companies. From August 1982 through 1986, Mr. Rizzuto was a director
and Vice-President of Management Information Systems for AGS International,
Ltd., a privately-held concern. From 1981 to August 1982, Mr. Rizzuto was
a Senior Director of Information Systems for the New York City Transit
Authority. Mr. Rizzuto received his B.S., Cum Laude, in Computer
Technology in 1975 from New York Institute of Technology.
DOUGLAS L. KING has been a Director of the Company for more than the
past five years. Mr. King has also been President and Chief Executive
Officer of Smyth, Sanford and Gerard Reinsurance Intermediaries, Inc. and a
director of United States Surgical Corporation for more than the past five
years. He is also President and Chief Executive Officer of C.C. King &
Co., Inc. Mr. King received his B.A. in 1963 from Stanford University, his
J.D. from Stanford University in 1966 and a Masters of Philosophy from the
University of London in 1968. He is a member of the Association of the Bar
of the State of California.
JOHN FORTE has been with the Company for more than the past five years
and is a Vice President and Chief Financial Officer of the Company. Since
July 1991, Mr. Forte has served as a Vice President of the Company. Mr.
Forte received his A.A.S. from Brooklyn College, New York in 1962 and his
B.B.A. from the City College of New York in 1966. He is a Certified Public
Accountant and has been a member of the New York State Society of Certified
Public Accountants and A.I.C.P.A. since 1969. Mr. Forte also maintains a
private accounting practice for his own clients and devotes approximately
one day per week to such activities.
Drs. Martin Kane and George Kane are brothers.
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<PAGE>
Based on a review of the Forms 3 and 4, and any amendments thereto,
filed during the year ended December 31, 1996 by those individuals required
to file and furnish to the Company such reports and the written
representation furnished to the Company by each such individual that he is
not required to file a Form 5, the Company knows of no delinquent filing
of, or failure to file, any such Form which was required to be filed during
such year.
COMMITTEES AND MEETINGS OF THE BOARD
The Company has a standing Audit Committee consisting of Messrs. Douglas
L. King, Bruce H. Safran and Stephen J. Cuchel. The Audit Committee is
responsible for supervising the financial affairs of the Company and the
relationship of the Company with its independent certified public
accountants. The Audit Committee did not meet during the Company's last
fiscal year.
The Company has a standing Executive Committee consisting of Messrs.
Douglas L. King, Martin Kane and Stephen J. Cuchel. The Executive
Committee is authorized to exercise all of the powers and authority of the
full Board of Directors in the management of the business of the Company,
with the exception of the powers to declare a dividend, authorize the
issuance of stock or adopt a certificate of ownership and merger, and may
not exercise those powers specifically prohibited by Section 141 of the
Delaware General Corporation Law. The Executive Committee did not meet
during the Company's last fiscal year.
The Company has a standing Stock Option Committee consisting of Messrs.
Douglas L. King, Stephen J. Cuchel and Bruce H. Safran. The Stock Option
Committee is responsible for administering the Company's 1985 Incentive
Stock Option Plan and 1985 Non-Qualified Stock Option Plan and did not meet
during the Company's last fiscal year.
The Company has a Director Plan Committee consisting of Messrs. Stephen
J. Cuchel, Martin Kane and Bruce H. Safran. The Director Plan Committee is
responsible for administering the Company's 1992 Director Stock Incentive
Plan. The Director Plan Committee did not meet during the Company's last
fiscal year.
The Company has a Stock Committee consisting of George Kane and Douglas
L. King. The Stock Committee is responsible for administering the
Company's 1992 Stock Incentive Plan. The Stock Committee acted once by
unanimous written consent during the last fiscal year.
The Company does not have a standing Nominating, Compensation or similar
Committee.
The Company's Board of Directors acted two times by unanimous written
consent and met once during the last fiscal year.
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<PAGE>
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
There is set forth below the compensation for services in all capacities
paid or accrued by the Company and its subsidiaries during the fiscal year
ended December 31, 1996 to the two Co-Chief Executive Officers and those
other executive officers whose cash compensation during 1996 exceeded
$100,000:
SUMMARY COMPENSATION
LONG TERM
COMPENSATION
------------
ANNUAL
------
COMPENSATION
------------
NAME AND FISCAL OPTIONS/ ALL OTHER
PRINCIPAL POSITION YEAR SALARY SARS (NO.) COMPENSATION(1)
------------------ ---- ------ ---------- -----------------
Stephen J. Cuchel, 1996 $183,121 100,000(2) $13,171
Chairman of the 1995 $158,445 65,000(3) $12,000
Board Co-Chief 1994 $140,861 65,000 $ 7,158
Executive Officer
and a Director
Martin Kane, 1996 $183,121 100,000(2) $10,168
President, 1995 $158,185 65,000(3) $ 8,900
Co-Chief 1994 $140,861 65,000 $ 7,676
Executive Officer
and a Director
Bruce H. Safran, 1996 $150,207 100,000(2) $ 8,589
Vice President, 1995 $136,597 50,000(3) $ 7,402
Secretary 1994 $128,112 50,000 $ 8,820
and a Director
John F. Forte,
Vice President, 1996 $128,640 150,000(2) $ 6,316
Chief Financial 1995 $103,290 25,000(3) $ 6,468
Officer 1994 $ 98,600 25,000 $ 5,768
Philip J. Rizutto, 1996 $106,014 ----- $ 4,802
Vice President 1995 $ 99,999 25,000(3) $ 5,244
and Director 1994 $ 99,999 25,000 $ 5,244
--------------------
(1) Consists of (i) matching contributions to the Retirement Savings Plan
of the Company for the years 1996, 1995 and 1994 for each of Drs.
Cuchel ($1,171, $1,627, $1,701), Martin Kane ($1,268, $1,646, $1,701),
Safran ($1,187, $1,323, $1,418) and Philip J. Rizutto ($808, $1,250,
$1,250), and (ii) insurance premiums paid by the Company for the years
1996, 1995 and 1994 for each of Drs. Cuchel ($12,000, $12,000,
$5,457), Martin Kane ($8,900, $8,900, $5,975), Safran ($7,402, $7,402,
$7,402), John Forte ($6,316, $6,468, $5,768) and Philip J. Rizutto
($3,994, $3,994, $3,994) on life insurance policies payable to
beneficiaries respectively designated by each insured.
(2) These options were granted to the named executive in 1996.
(3) These options were issued in 1995 in replacement of a like number of
options granted to the named executive in 1994.
During 1996, the Company paid a director's fee of $12,000 to Mr. Douglas
King and $25,000 to Dr. George Kane for services as a director and officer
of the Company.
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<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR/ OPTION VALUES AT FISCAL
YEAR END
During 1996, neither the co-Chief Executive Officers of the Company nor
any of the most highly compensated executive officers whose annual
compensation exceeded $100,000 exercised options to purchase Common Stock
of the Corporation.
The following table presents information regarding the number of options
to purchase the Company's Common Stock granted by the Company to the named
executive officers during the year ended December 31, 1996, the percentage
of each named executive officer's share of all such options granted to all
employees of the Company, the exercise price of each such executive
officer's options, and the expiration date of each such executive officer's
options.
OPTION GRANTS IN LAST FISCAL YEAR
(INDIVIDUAL GRANTS)
PERCENT OF
TOTAL
NO. OF OPTIONS
SECURITIES GRANTED TO
UNDERLYING EMPLOYEES EXERCISE OR
OPTIONS IN FISCAL BASE PRICE
NAME GRANTED (#) YEAR ($/SH)(1) EXPIRATION DATE
---- ----------- ---------- ----------- ---------------
Stephen J. Cuchel 100,000 20.00 1.7821 June 10, 2001
Martin Kane 100,000 20.00 1.7821 June 10, 2001
Bruce H. Safran 100,000 20.00 1.6201 June 10, 2006
John Forte 150,000 30.00 1.6201 June 10, 2006
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(1) Consists of Incentive Stock Options which were granted to the named
executive officers on June 11, 1996. The options may only be
exercised upon (i) a Change of Control of the Company, (ii) the sale
of all or substantially all of the assets of the Company to an entity
which is not an Affiliate (as defined under Rule 12b-2 of the General
Rules and Regulations promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) of the Company, or (iii) the
merger or consolidation of the Company with or into an entity which is
not an Affiliate of the Company whereupon the Company is not the
surviving entity. A "Change of Control of the Company" shall be
deemed to have occurred if any person (including any individual, firm,
partnership or other entity) together with all Affiliates and
Associates (as defined in Rule 12b-2 promulgated under the Exchange
Act) of such person, but excluding (i) a trustee or other fiduciary
holding securities under an employee benefit plan of the Company or
any subsidiary of the Company, (ii) an entity owned, directly or
indirectly, by the stockholders of the Company in substantially the
same proportions as their ownership of the Company, (iii) the Company
or any subsidiary of the Company, or (iv) a person who, as of the date
hereof, is a 10% Owner of the Company (as defined above), is or
becomes the Beneficial Owner (as defined in Rule 13d-3 promulgated
under the Exchange Act), directly or indirectly, of securities of the
Company representing 50% or more of the combined voting power of the
Company's then outstanding common stock. In the case of Drs. Cuchel
and M. Kane, the options are exercisable for a period of five years
from the date of grant and were granted at 110% of the Formula Price.
The options granted to Dr. Safran and Mr. Forte are exercisable for a
period of ten years and were granted at the Formula Price. The
"Formula Price" is equal to the average of the mean of the closing bid
and asked prices for the Company's Common Stock on the National
Association of Securities Dealers Automatic Quotation System during
the 20 trading days preceding the date of grant, eliminating from such
calculation the two high and two low bid and asked prices.
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<PAGE>
EMPLOYMENT AGREEMENTS
On October 3, 1984, the Company entered into three-year employment
agreements with each of Messrs. Stephen J. Cuchel, Martin Kane and Bruce H.
Safran, each a principal stockholder and director of the Company. The
Agreements are terminable by either party upon 30 days' written notice.
Pursuant to these agreements, Drs. Cuchel, Kane and Safran each devote
substantially all of his business time and efforts to the business affairs
of the Company.
SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The following table sets forth the number and percentage of shares of
the Company's Common Stock, par value $.001 per share, held by each
director, by each executive officer named in the Compensation Tables set
forth herein, by each person known by the Company to own in excess of five
percent of the Company's Common Stock and by all officers and directors as
a group as of April 10, 1997:
NAME AND ADDRESS OF SHARES PERCENT
BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
------------------- ------------------ --------
Stephen J. Cuchel (1) 519,918 14.27%
60 Charles Lindbergh Blvd.
Uniondale, NY 11553
Martin Kane (2) 499,400 13.67%
60 Charles Lindbergh Blvd.
Uniondale, NY 11553
Bruce H. Safran (3) 342,200 9.40%
60 Charles Lindbergh Blvd.
Uniondale, NY 11553
George Kane (4) 477,000 13.15%
P.O. Box 5085
Southampton, NY 11968
Douglas L. King (5) 23,000 0.63%
535 Center Island Road
Oyster Bay, NY 11771
Philip J. Rizzuto (6) 132,818 3.64%
60 Charles Lindbergh Blvd.
Uniondale, NY 11553
All Directors and 2,019,336 51.65%
Officers as a group
(seven persons)(7)
--------------------
(1) Includes 10,000 shares held in custody for certain members of Dr.
Cuchel's family and 65,000 shares which Dr. Cuchel may acquire upon
exercise of an Incentive Stock Option which is exercisable at a price
of $1.1979 per share. Does not include a conditional option,
exercisable at a price of $1.7821 per share, to acquire 100,000 shares
of common stock which was granted to Dr. Cuchel on June 11, 1996. See
"Option Grants in Last Fiscal Year (Individual Grants)".
(2) Includes 65,000 shares which Dr. Martin Kane may acquire upon exercise
of an Incentive Stock Option which is exercisable at a price of
$1.1979 per share. Does not include a conditional option, which is
exercisable at a price of $1.7821 per share, to acquire 100,000 shares
of Common Stock which was granted to Dr. Martin Kane on June 11, 1996.
See "Option Grants in Last Fiscal Year (Individual Grants)". George
Kane and Martin Kane are brothers. Each disclaims any voting or
investment power over the shares of Common Stock owned by the other.
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<PAGE>
(3) Includes 50,000 shares which Dr. Safran may acquire upon exercise of
an Incentive Stock Option which is exercisable at a price of $1.089
per share. Does not include a conditional option, exercisable at a
price of $1.6201 per share, to acquire 100,000 shares of Common Stock
which was granted to Dr. Safran on June 11, 1996. See "Option Grants
in Last Fiscal Year (Individual Grants)".
(4) Includes 45,000 shares which Dr. George Kane may acquire upon exercise
of an Incentive Stock Option which is exercisable at a price of
$1.1979 per share. George Kane and Martin Kane are brothers. Each
disclaims any voting or investment power over the shares of Common
Stock owned by the other.
(5) Includes 6,000 shares held in a trust of which Mr. King is a one-third
beneficiary; 10,000 shares which Mr. King may acquire upon exercise of
a Non-Qualified Stock Option which is exercisable at a price of $1.089
per share; and 5,000 shares which Mr. King may acquire upon exercise
of a Non-Qualified Stock Option which is exercisable at a price of
$.6015625 per share.
(6) Includes 25,000 shares which Mr. Rizzuto may acquire upon exercise of
an Incentive Stock Option which is exercisable at a price of $1.089
per share; and 32,818 shares which Mr. Rizzuto may acquire upon
exercise of an Incentive Stock Option which is exercisable at a price
of $.6015625 per share.
(7) Includes the shares and options referred to in Footnotes (1) through
(6) and 25,000 shares issuable to Mr. Forte upon exercise of an
Incentive Stock Option which is exercisable at a price of $1.089 per
share. Does not include conditional options to acquire 300,000 share
of Common Stock referred to in Footnotes (1), (2) and (3) above or a
conditional option, exercisable at a price of $1.6201 per share, to
acquire 150,000 shares of Common Stock which was granted to an officer
(Mr. Forte) on June 11, 1996. See Item 10. Executive Compensation.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During the year ended December 31, 1996, the Company derived revenues
from Dentcare Delivery Systems, Inc. ("Dentcare") of $2,438,342.
Drs. Martin Kane, Stephen J. Cuchel, Bruce H. Safran and George Kane are
directors of IHS and Drs. Bruce H. Safran and George Kane are also officers
of IHS.
In July 1996, each of Drs. Stephen J. Cuchel and Martin Kane borrowed
the amount of $50,000 from the Company. Each loan is evidenced by a
promissory note payable by the borrower to the Company in 35 equal,
consecutive, monthly installments commencing in August 1996, with a final
payment due in July 1999, and bears interest at a rate per annum equal to
the current prime rate of interest plus two percent.
During the years 1990 through 1992, the Company loaned to Dentcare a
total of $673,138 repayable with interest at 10% per year. In February
1994, in connection with a regular periodic audit of Dentcare by the New
York State Insurance Department, Dentcare was required to seek
reimbursement of certain expenses paid by Dentcare to the Company during
1985 and 1986, and which had subsequently been incorporated as part of he
loan between the Company and Dentcare. The Insurance Department agreed
that this reimbursement would be met by a reduction of the loan. On
February 23, 1994, the Company and Dentcare agreed to this reimbursement.
As a result of such reimbursement totaling $157,318, the loan was adjusted
to $515,820. Subsequent audits for the years 1987 through 1992 were
completed with no reimbursements requested. An audit for the years 1993
through 1996 has been scheduled for 1997.
Payment of principal and/or interest on the loan is subject to the
approval of the Superintendent of Insurance of the State of New York and
the availability of excess funds. Due to the uncertainty as to Insurance
Department approval of payment of the interest, the Company has elected to
defer the recognition of all interest income on the loan since inception.
The amount of interest not recognized was $51,582 for each of 1996 and 1995
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<PAGE>
and the cumulative balance thereof at December 31, 1996 is $314,817. The
Company will account for any interest payments as interest income when
designated interest payments are received from Dentcare. Notwithstanding
the uncertainty of future interest payments subject to regulatory approval,
the Company, based on its assessment of Dentcare's financial condition,
believes that the principal balance of the loan will ultimately be repaid;
accordingly no provision for impairment thereon has been made. When
prepayments designated as principal are received, they will be so recorded.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THIS PROPOSAL NO. 1.
RATIFICATION OF AUDITORS
(PROPOSAL NO. 2)
At the Meeting, a vote will be taken on a proposal to ratify the
appointment by the Board of Directors of Libero & Kappel, independent
public accountants, as the independent auditors of the Company for the
fiscal year ending December 31, 1997. Libero & Kappel has served as the
Company's independent auditors for the fiscal year ended December 31, 1996.
Management believes that the appointment of Libero & Kappel is in the
best interests of the Company and recommends that it be ratified. To be
ratified as the independent auditors of the Company, this proposal must
receive a majority of the votes cast. A representative of Libero & Kappel
is not expected to be present at the Annual Meeting of Stockholders of the
Company. If, however, a representative is present, he will be given an
opportunity to make a statement to the stockholders if he so desires and
will be available to respond to appropriate questions from stockholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" THIS PROPOSAL
NO. 2.
OTHER MATTERS
The Board of Directors knows of no other business to be brought before
the Meeting other than as set forth above. If any other business should
properly come before the Meeting, it is the intention of the persons named
in the enclosed form of proxy to vote such proxies in accordance with their
best judgment on such matters.
INCLUSION OF STOCKHOLDERS' PROPOSALS IN THE COMPANY'S
1998 PROXY STATEMENT
Stockholder proposals for the next Annual Meeting of Stockholders must
be received at the principal executive offices of the Company, 60 Charles
Lindbergh Blvd., Uniondale, New York 11553, not later than January 26, 1998
to be considered for inclusion in the Company's Proxy Statement for such
Meeting. Any request for such a proposal should be accompanied by a
written representation that the person making the request is a record or
beneficial owner of at least 1% or $1,000 in market value of the Company's
common shares and has held such shares for at least one year as required by
the Proxy Rules of the Securities and Exchange Commission.
-9-
<PAGE>
ANNUAL REPORT
A copy of the Company's combined Annual Report and Form 10-KSB,
including the financial statements for the fiscal year ended December 31,
1996, is being mailed to Stockholders together with this Proxy Statement.
By Order of the Board of Directors,
/s/ Bruce H. Safran
Bruce H. Safran,
Secretary
May 27, 1997
-10-
<PAGE>
HEALTHPLEX, INC.
PROXY--ANNUAL MEETING OF STOCKHOLDERS--JULY 1, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, a stockholder of Healthplex, Inc. (the "Company"),
hereby revoking any proxy heretofore given, does hereby appoint Stephen J.
Cuchel, Martin Kane and Bruce H. Safran, and each of them, proxies with
full power of substitution, for and in the name of the undersigned to
attend the Annual Meeting of the Stockholders of the Company to be held at
Brandywine Suites Hotel, 707 N. King Street, Wilmington, Delaware on July
1, 1997, at 12:45 P.M., New York time, and at any adjournment thereof, and
there to vote upon all matters specified in the notice of said meeting, as
set forth herein, and upon such other business as may properly and lawfully
come before the meeting, all shares of stock of said Company which the
undersigned would be entitled to vote if personally present at said
meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS GIVEN, SUCH
SHARES WILL BE VOTED FOR ALL PROPOSALS.
NO. 1. ELECTION OF DIRECTORS.
FOR ALL NOMINEES listed below [ ] WITHHOLD AUTHORITY [ ]
(except as marked to to vote for all the
the contrary below) nominees listed
below
(INSTRUCTION: To withhold authority to vote for any individual nominee
strike a line through the nominee's name in the list below.)
Stephen J. Cuchel, Martin Kane, Bruce H. Safran, Philip J. Rizzuto,
George Kane, Douglas L. King
NO. 2. RATIFICATION OF LIBERO & KAPPEL AS INDEPENDENT AUDITORS FOR THE
FISCAL YEAR ENDING DECEMBER 31, 1997.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(Continued on reverse side)
<PAGE>
In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting or any and all
adjournments thereof.
THE BOARD OF DIRECTORS REQUESTS THAT YOU FILL IN, DATE AND SIGN THE
PROXY AND RETURN IT IN THE ENCLOSED POSTPAID ENVELOPE.
Dated______________________________,1997
_______________________________________
Signature
_______________________________________
Signature if jointly held
PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
HEREON. In signing as attorney, executor,
administrator, trustee or guardian,
indicate such capacity. All joint tenants
must sign. If a corporation, please sign
in full corporate name by president or
other authorized officer. If a
partnership, please sign in partnership
name by authorized person.
