SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ ] Definitive proxy statement
[X] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12 [ ]
Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
HEALTH OUTCOMES MANAGEMENT, 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):
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(2) Aggregate number of securities to which transactions 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:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
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(4) Date filed:
<PAGE>
August 19, 1997
Shareholders
Health Outcomes Management, Inc.
RE: PROXY BATTLE
Dear Shareholders:
This is a very unusual, but very important letter.
By now you have received the Annual Report, Proxy Statement, and Proxy Card to
be submitted to select your members of the Board of Directors. We, the present
and nominated Board of Directors, appreciate your support as we strive to make
our company successful. The facts about our past and future as a company are
clearly described in the first four pages of the Annual Report.
It has recently come to our attention that a group of individuals, who call
themselves the "Greenstein Group" has submitted a preliminary proxy statement to
the SEC, for the purpose of replacing the current Board of Directors with a
slate of their own. They are planning on accomplishing this by sending you
another proxy statement which would have you believe that Health Outcomes
Management is "headed for insolvency at an alarming clip", and that Bill Peter
and Mike Frakes, the company's President and Vice President respectively, draw
exorbitant salaries. The "Greenstein Group" also claims that its new slate of
directors would have the ability to improve the company's performance.
Addressing these issues:
1. Bill Peter and Mike Frakes have been receiving salaries alot less than
they could earn elsewhere because they are dedicated to improving
patient care and they want to make a major contribution to healthcare.
Bill Peter took a 25% salary cut when he came to work for the company
from DuPont in 1986 (where he had managed a $300 Million medical profit
center). Mike Frakes is a Doctor of Pharmacy, a healthcare expert
lecturer, a consultant on healthcare information systems and
reimbursement processes, and many pharmacy areas. On May 15, 1996, when
the company was experiencing some sales shortfalls, Bill and Mike
voluntarily reduced their salaries by 10% each and have not had a
salary increase since then.
2. KPMG Peat Marwick LLP has been our Auditors since the company was
formed in 1986. The statement about "the ability to continue as a going
concern" has been reported in every Annual Report since the year ending
February, 1989 and is common with small, startup companies. The
"Greenstein Group" is not informing you of some brand new news. And,
the company is far from insolvency as the "Greenstein Group" states it.
The management has operated the company since February, 1989 with that
statement from the Auditors notwithstanding. That's what entrepreneurs
do. We are survivors. The company will continue to serve its patients,
its clients, its associates and its shareholders in the years ahead.
Our goal is to grow in sales and earnings and we expect stock price
will recognize that growth.
3. The present four (4) members of the Board of Directors have spent the
major portion of their professional careers involved exclusively in
healthcare:
Bill Peter 20 years Bob Cipolle 23 years
Mike Frakes 23 years Jerry Hoganson 23 years
<PAGE>
The four (4) men suggested as their slate for the Board of Directors by
the "Greenstein Group" do not claim to have any experience in
healthcare or computer software, except one who is President of a
retail optical store business since 1996. That's one (1) year of
experience in healthcare for their recommended slate of Board of
Directors.
On the subject of Board members, we have interviewed seven (7) potential
candidates during the past year. Some we found ourselves and some were offered
by the "Greenstein Group" and other investors. Our conclusion is that the ideal
candidate to add to the Board: a) is active in the healthcare industry, and b)
is part of a significant healthcare company which is enthusiastic about our
technology and has contracted with us to bring us substantial business. As we
progress with our search for strategic alliance partners, we are having active
discussions on Board membership for our business partners.
We ask you, our fellow shareholders, to support our company by doing the
following:
1. Complete, sign and mail in your original Proxy Card with an affirmative
vote for our current nominated Board of Directors.
2. Reject the "Greenstein Group's" attempt at replacing our Board with a
different slate that have neither healthcare nor computer software
experience.
3. Come to the annual meeting on September 18, 1997, to find out first
hand about the objectives, goals, and challenges of our company.
We feel that we are on the right track. We are continually looking for new
markets, alliances, ideas, capital, and partners to make Health Outcomes
Management a success. If you have any questions or comments, feel free to
contact us by phone or mail. We truly believe that we have excellent software
products and support in the industry, and that we will be a profitable company
for our investors.
Sincerely,
/s/ Robert J. Cipolle /s/ Michael J. Frakes
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Robert J. Cipolle, Pharm.D. Michael J. Frakes, Pharm.D.
Director: Peters Institute of Vice President
Pharmaceutical Care Health Outcomes Management, Inc.
University of Minnesota Minneapolis, MN
Minneapolis, MN
/s/ Jerry L. Hoganson /s/ William A. Peter, Jr.
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Jerry L. Hoganson, LNHA William A. Peter, Jr.
Administrator/Chief Operating Officer President/Chief Executive Officer
St. Paul's Church Home, Inc. Health Outcomes Management, Inc.
St. Paul, MN Minneapolis, MN
