<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held May 9, 1996
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of C.I.S.
Technologies, Inc. (the "Company"), will be held at the Doubletree Hotel, 6100
S. Yale Avenue, Tulsa, Oklahoma, on May 9, 1996 at 2:00 P.M., Central Standard
Time, for the following purposes:
1. To elect two members to the Board of Directors to serve for a three
year term, or until their successors have been elected and qualified;
2. To approve an amendment to the Certificate of Incorporation to
facilitate a one-for-two, -three, -four or -five reverse stock split if
the Board of Directors, prior to December 31, 1998, determines one of
such reverse stock splits to be advisable as being in the best interest
of the Company and its shareholders.
3. To consider and, if deemed advisable, to ratify the appointment of
Coopers & Lybrand as independent public accountants for the Company for
its fiscal year ending December 31, 1996, and
To transact such other business as may properly come before the meeting.
Only shareholders of record at the close of business on March 15, 1996 (the
"Record Date") will be entitled to notice of, and to vote at the meeting or any
adjournment or adjournments thereof. Shareholders who do not expect to attend
the meeting in person are urged to complete, date, sign and mail the enclosed
proxy for which no additional postage is needed if mailed in the United States.
HOLDERS, AS OF THE RECORD DATE, OF THE COMMON STOCK OF THE COMPANY WILL
RECEIVE A PROXY. PLEASE COMPLETE, SIGN, DATE, AND RETURN THE PROXY TO ASSURE
THAT ALL OF YOUR SHARES WILL BE VOTED.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Thomas G. Noulles
Thomas G. Noulles, Secretary
Tulsa, Oklahoma
March 31, 1996
IMPORTANT: IF YOU DO NOT PLAN TO ATTEND THIS MEETING, PLEASE COMPLETE, DATE,
SIGN (EXACTLY AS YOUR NAME APPEARS OF RECORD) AND RETURN THE ENCLOSED PROXY AT
YOUR EARLIEST CONVENIENCE. NO ADDITIONAL POSTAGE IS NECESSARY IF MAILED IN THE
UNITED STATES. <PAGE>
</PAGE>
C.I.S. TECHNOLOGIES, INC.
One Warren Place
6100 S. Yale, Suite 1900
Tulsa, Oklahoma 74136-1903
PROXY STATEMENT
For
ANNUAL MEETING OF SHAREHOLDERS
To Be Held May 9, 1996
SUMMARY
General
This Proxy Statement is furnished to shareholders of record of C.I.S.
Technologies, Inc. (the "Company"), as of March 15, 1996 (which is also, except
where indicated to the contrary, the effective date of the information set
forth herein and is hereinafter referred to as the "Record Date") in connection
with the solicitation of proxies by the Board of Directors and management of
the Company to be used in voting at the Company's annual meeting of
shareholders to be held on May 9, 1996 (the "Meeting") at 2:00 P.M. Central
Standard Time at the Doubletree Hotel, 6100 South Yale Avenue, Tulsa, Oklahoma,
for the purposes set forth in the accompanying Notice of the Meeting.
Any shareholder giving a proxy has the right to revoke the proxy at any time
before it is exercised and any such shareholder may vote in person if he or she
attends the Meeting. The approximate date of mailing the accompanying Notice
of the Meeting and this Proxy Statement to shareholders was March 31, 1996.
VOTING AT MEETING AND STOCK OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Voting
Shareholders of record on the Record Date are entitled to vote at the
Meeting or any adjournment or adjournments thereof. The Company's only class
of voting securities is common stock. Shareholders are entitled to one vote
per share of common stock held. As of the Record Date there were 30,188,589
shares of the Company's common stock issued and outstanding.
Nominees named in the accompanying form of proxy will vote or withhold from
voting the shares represented thereby in accordance with the instructions of
the shareholders. The proxy will confer discretionary authority upon any
nominees named therein with respect to:
(1) Each matter or group of matters identified therein for which a choice
is not specified;
(2) Any amendments to or variations of any matter identified therein; and
(3) Any other matter that may properly come before the meeting.
Management of the Company knows of no such amendment, variation or other
matter but, if any such amendment, variation or other matter is properly
brought before the Meeting, each such nominee intends to vote thereon in
accordance with his best judgment.
IN RESPECT OF MATTERS FOR WHICH A CHOICE IS NOT SPECIFIED IN THE PROXY, THE
NOMINEES NAMED IN THE ACCOMPANYING FORM OF PROXY WILL VOTE SHARES REPRESENTED
BY THE PROXY FOR THE APPROVAL OF SUCH MATTER OR GROUP OF MATTERS DESCRIBED IN
THE PROXY. <PAGE>
Principal Stockholders and Management
The following tables show information as of the Record Date regarding the
beneficial ownership of each class of capital stock of the Company by each
person known by the Company to own five percent (5%) or more of the outstanding
shares of the Company's common stock; each director of the Company; the
Company's Chief Executive Officer and each of the Company's four other most
highly compensated executive officers for 1995. The persons named in the table
have sole voting and investment power with respect to all shares of capital
stock owned by them, unless otherwise noted.
<TABLE>
<CAPTION>
Five Percent Beneficial Owners
Title of Name and Address Amount and Nature of Percent of
Class of Beneficial Owner Beneficial Ownership Class
<S> <C> <C> <C>
Common Stock Philip D. Kurtz . . . . . . . . . . . 1,964,645(1) 5.9%
c/o CIS Technologies, Inc.
6100 S. Yale, Suite 1900
Tulsa, OK 74136
Common Stock BT Holdings (New York), Inc. . . . . 1,635,818(2) 4.9%
130 Liberty Street
New York, NY 10006
Preferred Stock BT Holdings (New York), Inc. . . . . 2,384,182 7.1%
130 Liberty Street
New York, NY 10006
</TABLE>
Management
<TABLE>
<CAPTION>
Title of Name and Address Amount and Nature of Percent of
Class of Beneficial Owner Beneficial Ownership Class
Executive Officers
<S> <C> <C> <C>
Common Stock Richard A. Evans . . . . . . . . . . 252,928(4) *
Common Stock John P. Indrigo . . . . . . . . . . . 153,527(5) *
Common Stock Angela K. Lux . . . . . . . . . . . . 108,546(6) *
Directors
Common Stock Philip D. Kurtz, CEO . . . . . . . . 1,964,645(1) 5.9%
Common Stock James L. Hersma, COO . . . . . . . . 689,350(3) 2.1%
Common Stock Robert J. Simmons . . . . . . . . . . 156,050(7) *
Common Stock Dennis D. Pointer . . . . . . . . . . 138,500(8) *
Common Stock John D. Platt . . . . . . . . . . . . 135,000(9) *
Common Stock N. Thomas Suitt . . . . . . . . . . . 28,741(10) *
Common Stock Samuel L. Jacob . . . . . . . . . . . 0 *
Common Stock Directors and Named Executive
Officers as a Group . . . . . . . . . 3,627,287(11) 10.8%
</TABLE>
__________
* Represents less than 1% of total outstanding shares.
2 <PAGE>
<PAGE>
(1) Includes options to acquire 404,203 shares.
(2) Includes options to acquire 20,000 shares.
(3) Includes options to acquire 660,000 shares.
(4) Includes options to acquire 170,123 shares.
(5) Includes options to acquire 153,527 shares.
(6) Includes options to acquire 90,000 shares.
(7) Includes options to acquire 145,000 shares.
(8) Includes options to acquire 135,000 shares.
(9) Includes options to acquire 110,000 shares.
(10) Includes options to acquire 15,000 shares.
(11) Includes options to acquire 1,902,853 shares.
There are no arrangements known to the Company, including any pledge by any
person of securities of the Company, the operation of which may, at a
subsequent date, result in a change in control of the Company.
PROPOSAL 1. ELECTION OF DIRECTORS
The Bylaws of the Company provide that its Board of Directors shall consist
of not less than three nor more than 15 members as fixed by resolution of its
Board of Directors or shareholders. The Board of Directors of the Company has
determined that the full Board shall consist of seven directors. The
Shareholders approved at the 1993 Annual Meeting of Shareholders (held in
fiscal 1994) a proposal whereby the Board of Directors are divided into classes
serving staggered terms. At that Meeting, one such class was elected for a term
expiring at the 1994 Annual Meeting of Shareholders (held in fiscal 1995), one
class was elected for a term expiring at the 1995 Annual Meeting of
Shareholders (to be held in fiscal 1996), and one class was elected for a term
expiring at the 1996 Annual Meeting of Shareholders (to be held in fiscal
1997). Beginning with the 1994 Annual Meeting (held in fiscal 1995), one class
of directors is elected each year for a three-year term.
The following persons whose terms expire in 1996 have been nominated for
election as directors of the Company to hold office for a three-year term, or
until their successors are elected and qualified. A brief account of the
business experience for the past five years of the nominees is also presented.
All of the nominees are presently members of the Company's Board. It is not
contemplated that any of the nominees will be unable, or will decline to serve;
however, if any such nominee is unable or declines to serve, the discretionary
authority provided in the proxy may be exercised to vote for a substitute or
substitutes.
Nominees for Election of Directors
Robert J. Simmons, 53, is President of RJS Healthcare, Inc., a company
founded in July, 1990 to provide consulting services to healthcare providers,
and serves as Chairman of Healthcare Alliance, Inc. He has been a director of
the Company since May, 1989. Prior to founding RJS, Mr. Simmons was with
Baxter International, Inc. since 1985, last serving as executive vice
president. Mr. Simmons also serves on the Board of Directors of Pyxis
Corporation, Lake Forest Hospital and MBF/USA.
N. Thomas Suitt, 58, has been a director of the Company since July, 1992.
Mr. Suitt, after serving two sessions in the California State Assembly, founded
the Company's subsidiary, Reimbursement Services Division as Hospital Billing
Analysis, Inc. Mr. Suitt is currently Chairman of the Board for the Palm
Springs Savings Bank, the Desert Spectrum Development Corporation and the
Desert Hospital Corporation.
None of the nominees has any family relationship to any other director or
executive officer. There are no arrangements or understandings between any of
the named individuals and any other person or persons pursuant to which any of
the named individuals are to be elected as directors.
3 <PAGE>
<PAGE>
1995 Board and Committee Meetings
During the Company's last full fiscal year, the Board of Directors held ten
(10) meetings. No incumbent director attended fewer than seventy-five percent
(75%) of the aggregate of all 1995 Board meetings held since his election to
the Board and all meetings of committees of the Board (see below) on which he
served. Certain actions taken by the Board during fiscal 1995 were consented
to pursuant to memoranda of action in lieu of meetings to which all directors
subscribed.
Board Compensation
The directors not employed by the Company were each paid a retainer, except
in the case of Messrs. Jacob and Suitt, for 1995 in the form of ten-year non-
qualified options to purchase 15,000 shares of the Company's common stock at an
exercise price of $3.25. All of the aforementioned options were exercisable
beginning on April 28, 1995. In lieu of paying a retainer to Mr. Jacob,
options to purchase 20,000 shares of the Company's common stock at an exercise
price of $2.3125 were granted to BT Holdings (New York), Inc., which is Mr.
Jacob's employer. These options are exercisable as to 10,000 shares on April
26, 1996 and 10,000 shares on April 26, 1997. Mr. Suitt was paid a retainer
for 1995 of $7,500 cash. The Directors also receive $1,500 per day for their
attendance at directors' and board committee meetings (unless held
consecutively with a Board meeting) and other services as directors. Directors
are also compensated $250 per telephone meeting at which their attendance is
required and receive compensation for serving on Board committees, as shown
below. All directors also receive reimbursement of expenses related to
attending Board meetings.
Board Committees
The Board of Directors has three standing committees, those being Finance,
Audit and Compensation Committees, to devote attention to specific subjects and
to assist it in the discharge of its responsibilities. The functions of those
committees, their current members and the number of meetings held during the
1995 fiscal year are described below.
Finance Committee. The Finance Committee reviews the Company's financial
performance, capitalization, cash flow projections and the Company's lines of
credit and their terms. The Finance Committee also reviews any proposed
acquisitions, mergers or the sale of any business segment of the Company as
well as reviewing proposed issuances of any stock or senior debt. The Finance
Committee presently consists of Mr. Simmons, as Chairman, and Messrs. Platt and
Suitt. The Finance Committee held two meetings during the year. The Chairman
of the Finance Committee is compensated $1,500 per year and members are
compensated $750 per year.
Audit Committee. The Audit Committee is responsible for ensuring that the
Company adopts and maintains sound accounting policies and an adequate and
effective system of accounts for the safeguarding of all assets and presently
consists of Mr. Pointer, as Chairman, and Messrs. Platt and Suitt. The Audit
Committee held two meetings during the year. The Chairman of the Audit
Committee is compensated $750 per year and members are compensated $500 per
year.
Compensation Committee. The Compensation Committee is responsible for
formulating and reviewing the compensation offered to the officers of the
Company, together with all benefit and incentive programs associated therewith,
and presently consists of Mr. Platt, as Chairman, and Messrs. Pointer and
Simmons. The Compensation Committee held six meetings during the year. The
Chairman of the Compensation Committee is compensated $1,500 per year and
members are compensated $750 per year.
4 <PAGE>
<PAGE>
Recommendation and Vote
The Board of Directors recommends the election of the nominees listed
above as directors of the Company to hold office until the 1998 Annual Meeting
(to be held in the first half of 1999) or until their successors are elected
and qualified. The affirmative vote of a majority of the shares of Company
common stock represented at the Meeting is required for such approval.
PROPOSAL 2. APPROVAL OF AMENDMENT TO THE CERTIFICATE OF INCORPORATION TO
FACILITATE A ONE-FOR-TWO, -THREE, -FOUR OR -FIVE REVERSE STOCK SPLIT IF THE
BOARD OF DIRECTORS, PRIOR TO DECEMBER 31, 1998, DETERMINES ONE OF SUCH REVERSE
STOCK SPLITS TO BE ADVISABLE AS BEING IN THE BEST INTEREST OF THE COMPANY AND
ITS SHAREHOLDERS
The Board of Directors of the Company is of the opinion that the
shareholders should take action at this time to make it possible to carry out a
future reduction in the total number of outstanding shares of the Company's
common stock ("Shares") by way of a reverse stock split in the manner described
below.
Reasons for the Proposal
The Board has been informed that the principal risk associated with an
otherwise advisable reverse stock split is that the trading price of the post-
split Shares would not reflect the ratio of the number of post-split to pre-
split Shares. The Board has been further informed that such risk would
increase if there were an extended period of time between the announcement and
the completion of a reverse stock split during which trading in Shares on the
basis of the pending split could occur. The Board believes, given that any
reverse stock split will be carried out only if then deemed advisable, that
such trading would necessarily be carried on by less sophisticated investors
for reasons lacking a sound, rational basis and should, therefore, be avoided
so as to eliminate, to the extent possible, unwarranted volatility in the
trading price of the Shares.
The Board has concluded that the possibility of lengthy delays associated
with soliciting shareholder approval, which is required by applicable law prior
to effecting a reverse stock split, should be presently eliminated. By so
doing in the manner described below, the Board would have the flexibility,
within certain Share ratio and time constraints set forth below, to announce
and complete a reverse stock split within a matter of days, should it then
determine that so doing is advisable.
Potential Benefits of a Reverse Stock Split
The Board believes that the Company and its shareholders could anticipate
the following potential benefits from a reverse stock split, depending upon the
then circumstances:
Brokerage Firm Research Analyst Coverage. Larger stock brokerage firms
tend to have policies against publishing research reports on companies with
relatively low per-share stock prices. A higher price for the Shares, which
can be expected to result from a reverse stock split, would tend to remove
this barrier to research analyst coverage on the Company.
Stock Trading "Spread." Nasdaq-traded stocks, such as the Shares, are
generally sold at the "bid" price and purchased at the "ask" price. The
difference between the "bid" and the "ask" price is the "spread," which is
generally retained as compensation by the broker in the transaction. The
"spread" is typically 1/8 ($.125) to 3/16 ($.375) per share, regardless of
the per-share price. This relatively greater cost of buying or selling
lower priced stocks and the resultant discouragement of investment in the
Shares would tend to be alleviated by an increase in the price of the
Shares, which can be expected to result from a reverse stock split.
5 <PAGE>
<PAGE>
Brokerage Firm Margin Requirements. Each brokerage firm sets a minimum
price in order for stocks held by that firm to be deemed "marginable."
Generally, "marginable" stocks may be used as collateral for brokerage firm
loans to its customers in whose accounts such stocks are held. Lack of
"marginability" tends to discourage some investors from investing in lower
priced stocks. An increase in the price of the Shares, which can be expected
to result from a reverse stock split, would tend to make the Shares more likely
to be "marginable."
Brokerage Firm Non-Solicitation Rules. Many brokerage firms have rules
against the solicitation of buyers for lower priced stocks, requiring their
brokers to obtain a written statement that such a buyer has not been solicited
by the broker. This practice tends to discourage brokers from dealing in lower
priced stocks. An increase in the price of the Shares, which can be expected
to result from a reverse stock split, would tend to alleviate this situation.
Institutional Investment. The investment criteria adhered to by many
institutional investors include prohibitions against the purchase of lower
priced stocks. An increase in the price of the Shares, which can be expected
to result from a reverse stock split, would tend to remove this barrier to
institutional investment in the Shares.
In addition, the Board of Directors believes that a reverse split of the
Shares could, depending on circumstances at the time, be perceived as a
positive statement by the Board and management as to the outlook for the
Company's future in that the Company would appear ready to move to a new
plateau in the investment community, to attract a new, more sophisticated
investment audience, and to shed negative perceptions associated with lower
priced stocks.
Effect of the Proposal
If the proposal is approved, the Board will have (1) the flexibility to
determine the appropriateness of a reverse stock split, including the then most
appropriate of such ratios, and (2) the ability to complete such reverse stock
split shortly after announcing it by proceeding with the filing of a
Certificate of Amendment to the Certificate of Incorporation. The entire
series of amendments may be abandoned by the Board without further shareholder
action at any time, and will be so abandoned if the Board does not determine to
effect any reverse stock split by December 31, 1998. If such determination is
made by December 31, 1998, a reverse stock split will be completed in the then
most appropriate of the foregoing ratios as determined by the Board, no
subsequent reverse stock split in any of the other foregoing ratios will be
thereafter authorized, and the amendments relating to such other ratios will be
abandoned.
Any future determination of the appropriateness of a reverse stock split in
one of the foregoing ratios will depend upon factors not capable of being
predicted, such as the future trading price of the Shares and the future growth
and development of the Company's business. Such determination will be made by
the Board with the advice of the Company's senior management and investment
advisors with the objective of maximizing the aggregate market value of the
Shares consistent with the Company's then historical, and then reasonably
anticipated future, financial condition and results of operations and other
generally accepted indicia of such market value.
The resolution approving the amendments to the Company's Certificate of
Incorporation to authorize the Board to effect a future reverse stock split is
set forth at Appendix A to this proxy statement.
Effect of a Reverse Stock Split
Outstanding Shares and Par Value. If a reverse stock split should be
carried out in the future, each then outstanding Share would become, depending
upon which of the foregoing ratios is then deemed by the Board to be most
advisable, one-half (1/2), one-third (1/3), one-fourth (1/4), or one-fifth
(1/5) of a new Share, and the par value would be increased from the present
$.01 per share to $.02, $.03, $.04, or $.05, respectively, per Share. The
foregoing would occur as of the close of business on a date which would be
established by the Board (the "Effective Date"), whereupon each certificate
representing Shares would thereafter represent one-half (1/2), one-third (1/3),
one-fourth (1/4), or one-fifth (1/5) of the number of Shares indicated on the
Certificate.
Exchange of Stock Certificates. If a reverse stock split should be carried
out in the future, as soon as practicable after its Effective Date,
shareholders will be notified and requested to surrender their pre-split Share
certificates for new
6 <PAGE>
<PAGE>
certificates representing the number of post-split Shares. Until so
surrendered, each pre-split Share certificate will be deemed for all corporate
purposes after the Effective Date to evidence ownership of the appropriately
reduced number of Shares. Chemical Mellon Shareholder Services will act as
exchange agent (the "Exchange Agent") for the shareholders in effecting the
exchange of their Share certificates.
Elimination of Fractional Shares. In the event of a reverse stock split, no
scrip or fractional Shares will be issued but, in lieu thereof, a certificate
or certificates evidencing the aggregate of all fractional Shares otherwise
issuable rounded, if necessary, to the next higher whole Share, will be issued
to the Exchange Agent, or its nominee, as agent for the accounts of all holders
of Shares otherwise entitled to have a fraction of a Share issued to them. In
such event, sales of fractional interests will be effected by the Exchange
Agent as soon as practicable on the basis of prevailing market prices of the
Shares as reported on the Nasdaq National Market System at the time of such
sales. After the Effective Date, the Exchange Agent or the Company will pay to
such holders of Shares their pro rata share of the net proceeds derived from
the sale of their fractional interests upon surrender of their Share
certificates. No service charges or brokerage commissions will be payable by
Shareholders in connection with the sale of fractional interests, all of which
costs will be borne by the Company.
Effect on Outstanding Rights to Acquire Shares. The terms of all
instruments establishing outstanding rights to acquire Shares (stock options,
w a rrants, and convertible preferred stock) provide for an appropriate
adjustment in the number of Shares subject to such rights in the event of a
reverse stock split. Any reverse stock split would be subject to such
approvals and authorizations as may be required from appropriate regulatory
agencies.
Federal Income Tax Consequences. The following information is based upon
existing law which is subject to change by legislation, administrative action
and judicial decision and is necessarily general. Therefore, if a reverse
stock split of the Shares were to take place, shareholders are advised to
consult their own tax advisors for then current and more detailed information
relating to their individual tax circumstances.
If a reverse stock split occurs, that event will be a tax-free
recapitalization for the Company and its shareholders. As a result of such tax
treatment, the conversion of pre-split Shares in the hands of a holder thereof
to a reduced number of post-split Shares would not constitute taxable income
and would not result in gain or loss to such holder for Federal income tax
purposes. The aggregate tax basis of such post-split Shares would, for
purposes of computing gain or loss upon disposition thereof, equal the
aggregate tax basis of the pre-split Shares from which such post-split Shares
are derived. The holding period for post-split Shares will be the same as the
holding period of the pre-split Shares from which such post-split Shares are
derived. Holders of pre-split Shares who receive cash from the sale of
fractional interests in post-split shares will recognize gain or loss for
Federal income tax purposes as a result of the disposition of such interests.
Recommendation and Vote Required for Approval
For the foregoing reasons, the Board has approved and declared advisable
resolutions approving a series of four amendments to the Company's Certificate
of Incorporation (set forth in Appendix A to this Proxy Statement) in order to
provide a mechanism for effecting a reverse split of the Shares in either a
one-for-two, -three, -four, or -five ratio of the number of post-split to pre-
split Shares. The Board believes that its ability to expeditiously carry out a
reverse stock split in one of the foregoing ratios prior to December 31, 1998
without the need for further action by the shareholders would benefit the
Company and its shareholders. THE BOARD RECOMMENDS APPROVAL OF THE PROPOSAL IN
THE BELIEF THAT IT IS IN THE BEST INTEREST OF THE COMPANY AND ITS SHAREHOLDERS.
The affirmative vote of a majority of the outstanding Shares is required for
the adoption of the proposal.
7 <PAGE>
<PAGE>
PROPOSAL 3. RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
At the Company's most recent annual meeting of shareholders held on April
27, 1995, shareholders appointed Coopers & Lybrand to perform the Company's
independent public accounting services for the fiscal year ended December 31,
1995. The Board of Directors has selected Coopers & Lybrand as the independent
public accountants for the Company for the fiscal year ending December 31,
1996, subject to ratification by the shareholders at the Meeting. It is
anticipated that a representative of Coopers & Lybrand will be in attendance at
the Meeting, will be given an opportunity to make a statement if he desires to
do so, and will be available to respond to appropriate questions.
OTHER BUSINESS
Management knows of no other business matters which are to be presented for
action at the Meeting. Should any other matters properly come before the
Meeting, the persons named in the accompanying proxy will have discretionary
authority to vote all proxies in accordance with their judgment.
It is important that proxies be returned promptly. Therefore, shareholders
who do not expect to attend in person are urged to execute and return the
enclosed proxy to which no postage need be affixed if mailed in the United
States.
8 <PAGE>
<PAGE>
MANAGEMENT
Executive Officers
The executive officers of the Company, their ages, positions held with the
Company and length of time in such positions are set forth below. There are no
family relationships between or among any of the directors or executive
officers of the Company. There are no arrangements or understandings between
any of the named individuals and any other persons pursuant to which any of the
named individuals are to be elected as officers.
<TABLE>
<CAPTION>
Name and Age of
Executive Officer Positions and Offices Held Officer Since
<S> <C> <C>
Philip D. Kurtz . . . . . . . . . . . . Chief Executive Officer September, 1985
Age 44
James L. Hersma . . . . . . . . . . . . President and Chief Operating Officer November, 1993
Age 47
Richard A. Evans . . . . . . . . . . . Chief Financial Officer and Treasurer October, 1985
Age 43
Kathleen Harris Pena . . . . . . . . . Senior Vice President February, 1995
Age 38
Ralph J. Riccardi . . . . . . . . . . . Senior Vice President February, 1995
Age 42
</TABLE>
A brief account of the business experience for the past five years of the
individuals listed above follows.
Philip D. Kurtz, 44, founded the Company in 1983 and since that time has
served as President, Chief Executive Officer, and director of the Company.
Prior to founding the Company, Mr. Kurtz owned his own accounting and
consulting firm. He is a Certified Public Accountant and has a Bachelor's of
Science degree in Business Administration and Accounting from the University of
Tulsa.
James L. Hersma, 47, has served as President and Chief Operating Officer
since March, 1994. Prior thereto, Mr. Hersma served as Executive Vice
President and Chief Operating Officer of the Company from November 1, 1993.
From 1984 to October, 1993, Mr. Hersma served as Vice President of Corporate
Sales, Southwest Division, and then as Vice President/General Manager of the
Hospital Supply Division of Baxter Healthcare Corporation. From 1978 to 1984,
Mr. Hersma served in various management positions with the American Hospital
Supply division of Baxter Healthcare Corporation. Mr. Hersma has a Bachelor's
of Science degree in Marketing from Northern Illinois University.
Richard A. Evans, 43, has served as the Company's Chief Financial Officer
and Treasurer since 1989. He also served as the Company's Controller from
1985-1989. Mr. Evans is a Certified Public Accountant with a Bachelor of
Science degree in Business Administration from Oklahoma State University.
Kathleen Harris Pena, 38, is the Company's Senior Vice President - Financial
Services. Prior to being named Senior Vice President, Ms. Pena served as Vice
President - Professional Services of the Company in 1995, General Manager in
1993 and 1994, District Sales Manager from September, 1990 through 1992, and
Director - Marketing from August, 1989 to September, 1990. Ms. Pena received a
Bachelor's of Science degree from Texas Christian University and a Masters in
Business Administration from Emory University.
Ralph J. Riccardi, 42, is the Company's Senior Vice President - Technology
and Applications. Prior to that time, he served in various capacities with the
Company, including Vice President, Director of Marketing and Director of
Government Programs/Marketing. Mr. Riccardi served 16 years with the United
States Air Force Medical Service
9 <PAGE>
<PAGE>
Corps. He is a Certified Healthcare Executive and has a Bachelor's of Science
and Administration degree from Chapman University and a Masters in Business
Administration from Mississippi State University.
Directors
Members of the Company s Board have terms which expire, in the case of Mr.
Platt and Mr. Pointer, in 1998, in the case of Mr. Kurtz, Mr. Hersma, and Mr.
Jacob, in 1997, and in the case of Mr. Suitt and Mr. Simmons, in 1996. A brief
account of the business experience for the past five years is presented below.
Philip D. Kurtz, (see description under Executive Officers," above)
James L. Hersma, (see description under Executive Officers," above)
Robert J. Simmons, (See description under Proposal 1. Election of
Directors )
N. Thomas Suitt, (See description under Proposal 1. Election of Directors )
Samuel L. Jacob, 40, is currently the Managing Director of Global Client
Management and Sales in the Western Hemisphere of Bankers Trust Company and has
been a director of the Company since August, 1995. Mr. Jacob joined Bankers
Trust in 1983 as Vice President and Controller of the Global Markets business,
and has held several positions with Bankers Trust.
John D. Platt, 65, has been, since 1983, founder and President of Platt
Interests, and has been a director of the Company since May, 1990. Formerly,
Mr. Platt served as President, Chairman of the Board and Chief Executive
Officer of Geosource, Inc. Mr. Platt is currently Chairman of the Board for
CVA, Inc., and serves on the Board of Directors of TransAmerican Natural Gas
Corporation.
Dennis D. Pointer, Ph.D., 50, has been, since 1992, the John J. Hanlon
Professor of Health Services Research and Policy at the Graduate School of
Public Health, San Diego State University, and has been a director of the
Company since May, 1989. Formerly, he was the Arthur Graham Glasgow Professor
of Health Administration in the Department of Health Administration of the
Medical College of Virginia, Virginia Commonwealth University in Richmond,
Virginia. Mr. Pointer is currently Chairman of the Board of Daniel Freeman
Hospitals, Inc.
10 <PAGE>
<PAGE>
Executive Compensation
The table below shows information concerning the annual and long-term
compensation for services in all capacities to the Company earned during the
fiscal years ended December 31, 1995, 1994, and 1993, of those persons who
were, during the last completed fiscal year, serving as (i) the Chief Executive
Officer and (ii) the other four most highly compensated executive officers of
the Company, (together, the Named Officers ).
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
(a) (b) (c) (g) (i)
Securities
Name and Underlying All Other
Principal Position Year Salary($)(1) Bonus(2) Options/SAR's (#)(3) Compensation ($)(8)
<S> <C> <C> <C> <C> <C>
Philip D. Kurtz 1995 $ 239,798 $ -0- 280,000 $ 6,422
Chief Executive Officer 1994 239,096 100,000 40,000 4,965
1993 220,808 -0- 46,839 4,326
James L. Hersma 1995 $ 235,552 $ -0- 360,000 $ 6,931(4)
President and Chief 1994 291,868(5) $ 100,000 300,000 6,024
Operating Officer 1993 78,287 -0- -0- -0-
Richard A. Evans 1995 $ 118,146 $ -0- 50,000 $ 2,728
Chief Financial 1994 113,892 28,088 30,000 2,323
Officer and Treasurer 1993 110,667 -0- 23,288 1,976
John P. Indrigo 1995 $ 137,824 $ -0- 50,000 $ 26,887(6)
Senior Vice President 1994 121,317 $ 30,258 40,000 3,094
1993 121,907 -0- 42,632 2,979
Angela K. Lux 1995 $ 139,981 $ -0- 40,000 $ 10,708(7)
Vice President and 1994 64,431 $ 30,000 50,000 2,284
Chief Technology Officer 1993 n/a n/a n/a n/a
</TABLE>
(1) Includes Named Officer's before-tax contribution to the Thrift and Profit
Sharing Plan ("401(k) Plan"). The 401(k) Plan allows employees of the
Company with at least ninety (90) days of service to make tax-deferred
contributions of up to 25% of their gross salary to the plan through
payroll deduction. In 1995, the Company contributed a cash amount equal
to 25% of the employee's contribution up to six percent (6%) of the
employee's base salary. In 1996, the Company will contribute a cash
amount equal to 50% of the employee's contribution up to three percent
(3%) of the employee's base salary.
(2) The 1994 bonuses were paid in early 1995, but were earned for fiscal year
1994.
(3) The 1995 options were granted pursuant to the Company's Stock Incentive
Plan ("SIP"), which replaced the Employee Stock Option Plan and the Stock
Option Plan. Options granted under these plans are granted at times, in
amounts, and to such individuals who are employees of the Company as may
be determined by the Board of Directors. The option price is equal to the
value of the Company's common stock on the date of grant. The Company
does not have an SAR program.
(4) Includes $1,250 of expenses paid on behalf of Mr. Hersma for tax
preparation.
(5) Includes a bonus of $62,499 per Mr. Hersma's 1993 employment agreement.
(6) Includes $23,047 for moving expenses for Mr. Indrigo.
11 <PAGE>
<PAGE>
(7) Includes $7,271 for principal payments forgiven by the Company, as
Holder, on a promissory note payable by Ms. Lux.
(8) Reflects the Company's matching contribution to the 401(k) Plan. Also
reflects the Company's contributions to the account of Ms. Lux in the
Company's Employee Stock Purchase Plan ("ESPP") and premiums paid by the
Company on behalf of the Named Officer for a Term Life Insurance Policy
as follows:
<TABLE>
<CAPTION>
Year ESPP Term Life Premiums
<S> <C> <C> <C>
Philip D. Kurtz 1993 $ n/a $ 2,040
1994 $ n/a $ 2,679
1995 $ n/a $ 4,080
James L. Hersma 1993 $ n/a $ 0
1994 $ n/a $ 3,714
1995 $ n/a $ 3,660
Richard A. Evans 1993 $ n/a $ 960
1994 $ n/a $ 974
1995 $ n/a $ 960
John P. Indrigo 1993 $ n/a $ 1,150
1994 $ n/a $ 1,355
1995 $ n/a $ 1,335
Angela K. Lux 1993 $ n/a $ n/a
1994 $ 1,000 $ 1,284
1995 $ 2,400 $ 1,265
</TABLE>
Pursuant to the ESPP, eligible employees, including executive officers, may
withhold up to 100% of their salary through payroll deduction for the
purpose of purchasing the Company's stock. The Company currently
contributes a cash amount equal to 25% of the employee's contribution. All
shares acquired through the ESPP are immediately 100% vested and are
entitled to participate in dividends, if any are declared, to the same
extent as other outstanding shares of the Company's common stock.
The following table provides information regarding stock options granted to
the Named Officers during 1995. In assessing these values it should be kept in
mind that no matter what theoretical value is placed on a stock option on the
date of grant, its ultimate value will be dependent on the market value of the
Company's stock at a future date -- and that value will depend, at least in
part, on the efforts of such executives to foster the future success of the
Company for the benefit of not only the executives, but all shareholders.
12 <PAGE>
<PAGE>
<TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<CAPTION>
Potential
Realizable Value At
Assumed Annual Rates
of Stock Price
Appreciation
Individual Grants for Option Term
(a) (b) (c) (d) (e) (f) (g)
Number % of Total
of Securities Options/SARs
Underlying Granted Exercise
Options/ to Employees or Base
SARs in Fiscal Price Expiration
Name Granted(#)(1) Year ($/Sh.) Date 5%($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
Philip D. Kurtz 90,000 20.4% $ 2.125 03/06/05 $ 311,526 $ 496,053
90,000 $ 2.3125 04/26/05 $ 339,014 $ 539,823
100,000 $ 3.125 08/03/05 $ 509,030 $ 810,545
James L. Hersma 80,000 26.3% $ 2.125 03/06/05 $ 276,912 $ 440,936
80,000 $ 2.3125 04/26/05 $ 301,346 $ 479,842
200,000 $ 2.75 07/17/05 $ 895,892 $ 1,426,558
Richard A. Evans 25,000 3.6% $ 2.125 03/06/05 $ 86,535 $ 137,793
25,000 $ 2.3125 04/26/05 $ 94,170 $ 149,951
John P. Indrigo 25,000 3.6% $ 2.125 03/06/05 $ 86,535 $ 137,793
25,000 $ 2.3125 04/26/05 $ 94,170 $ 149,951
Angela K. Lux 20,000 2.9% $ 2.125 03/06/05 $ 69,228 $ 110,234
20,000 $ 2.3125 04/26/05 $ 75,336 $ 119,961
</TABLE>
(1) Reflects options to acquire shares of Common Stock pursuant to the
Company's SIP. Key employees and others, as determined by the Board of
Directors, may participate in the SIP. The Board determines the
expiration date of each option. For incentive options, exercise prices
must be not less than the market value of CIS common stock on the date of
grant.
13 <PAGE>
<PAGE>
The following table shows stock option exercises by the Named Officers
during 1995, including the aggregate value of gains on the date of exercise.
In addition, this table includes the number of shares covered by both
exercisable and non-exercisable stock options as of December 31, 1995. Also
reported are the values for "in-the-money" options which represent the positive
spread between the exercise price of any such existing stock options and the
year-end price of Common Stock.
<TABLE>
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR, AND FY-END OPTION VALUES
<CAPTION>
(a) (b) (c) (d) (e) (f) (g)
No. of Securities Underlying Value of Unexercised In-The-Money
Shares Acquired Value Unexercised Options at FY-End Options at FY-End
Name on Exercise (#) Realized Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Philip D. Kurtz -0- n/a 132,536 271,667 $ 50,313 $ 376,250
James L. Hersma -0- n/a 201,389 458,611 $ 20,556 $ 334,444
Richard A. Evans -0- n/a 102,901 67,222 $ 134,491 $ 104,513
John P. Indrigo -0- n/a 66,303 87,224 $ 6,424 $ 104,513
Angela K. Lux -0- n/a 32,222 57,778 $ 71,388 $ 129,862
</TABLE>
[Subject to change if stock price is $2.625 or above prior to completion of
definitive proxy.]
In October, 1995, Messrs. Hersma and Kurtz entered into an Amendment to
Change in Control and Severance Compensation Agreement with the Company
("Amendment"). This Amendment allows for noncancellation of options whose
vesting is not accelerated under the Amendment that would otherwise be
cancelled under the SIP due to termination of Mr. Hersma and/or Mr. Kurtz
within two (2) years of a change of control of the Company or termination not
for cause. Mr. Hersma and Mr. Kurtz have ninety (90) days from the date of
their termination in which to exercise such options.
REPORT OF THE COMPENSATION COMMITTEE ON ANNUAL COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee") is
composed entirely of independent non-employee directors: Messrs. Platt, Pointer
and Simmons. The Committee is responsible for formulating and reviewing the
compensation offered to the officers of the Company, together with all benefit
and incentive programs associated therewith. The Compensation Committee
evaluates and awards stock options to the Company's executive officers.
The Committee annually evaluates the Company's corporate performance,
officer compensation and share ownership compared with both the Company's own
industry and a broader group of companies.
Compensation Policy
The goal of the Company's executive compensation policies is to ensure that
an appropriate relationship exists between executive pay and the creation of
shareholder value, while at the same time to create a corporate atmosphere that
attracts, motivates and retains key employees.
14 <PAGE>
<PAGE>
1995 Executive Compensation Program and Performance Measures
During 1995, the Committee further developed an executive compensation
program that integrated annual base compensation with other forms of equity-
based and cash compensation based upon corporate performance and individual
initiatives and performance. This program was designed to attract and retain
qualified executives and to ensure that such executives have a continuing stake
in the long-term success of the Company. Specifically, the Company's executive
compensation program was comprised of (1) base salary, (2) cash incentive
opportunities, and (3) short- and long-term incentive opportunities in the form
of stock options.
(1) Base Salary. The Committee used executive compensation survey data,
along with information on the Company's size and performance levels compared to
that of other companies that are primarily involved in the healthcare
reimbursement services industry, as a guide to establish base salaries and
incentive compensation levels of executive officers, using publicly available
information from prospectuses, proxy statements and Forms 10-K. During fiscal
1995, merit salary increases for the Named Officers ranged from one and one-
quarter percent (1.25%) to three percent (3%). Individual salary increases for
executive officers below the levels of CEO and COO were at the discretion of
the Company's CEO and COO, and were based upon the achievement of personal,
departmental and company goals established for each executive officer by the
CEO and COO. Departmental goals included project improvement objectives and
budgetary performance, and in the view of the CEO and COO were met in all
cases. Company goals included increase in earnings per share and return on
equity from the previous year, which were met.
(2) Cash Incentive Opportunities. Additionally, the Committee established
for the executive officers a cash bonus opportunity and accordingly, the
Company established a cash bonus pool accrual based upon Company earnings and
the achievement by the executive officers of certain individually set and
approved management objectives. Seventy percent (70%) of the individual
bonuses for Messrs. Kurtz, Hersma and Evans and Ms. Lux were based on the
achievement of the company s earnings target developed in January, 1995, and
the remaining thirty percent (30%) were based on the achievement of documented
and approved individual management objectives (MBO s). Individual awards for
Mr. Indrigo were based 25% on the achievement of corporate earnings targets,
50% on business unit earnings targets, and 25% on the achievement of MBOs.
Since goals were not achieved in 1995, none of the executive officers received
a cash bonus for 1995.
(3) Short- and Long-Term Incentive Opportunities (Stock Options) as
determined by the Compensation Committee. It is also the Company's policy to
issue short- and long-term incentives in the form of stock options to the
Company's executive officers. On March 6, 1995 and April 26, 1995, the
Compensation Committee awarded the Company's executive officers tax-qualified
and non-qualified incentive stock options pursuant to the Company's Stock
Incentive Plan ("SIP"). These awards were based on the Compensation
Committee s desire to bring the total options awarded to each executive officer
to a level of parity with other officers based on length of service, number of
prior options, level of responsibilities and salary level.
The Board has the authority under the SIP to determine the expiration dates
of the option grant and may set exercise prices at levels that vary from the
market value of CIS stock on the date of grant for non-qualified options. The
aforementioned options were granted at the closing price of the Company's
common stock on the date of grant (March 6, 1995 and April 26, 1995,
respectively), vest nine and one-half years from the date of grant and must be
exercised within ten years from the date of grant. However, vesting may be
accelerated by meeting certain objectives based, in the case of the short-term
stock options, on the Company's earnings per share, and, in the case of the
long-term stock options, on the Company's sustainable stock price, return on
shareholder equity and revenue growth.
The Board has also authorized grants, at its discretion, throughout the year
under the SIP to certain executive officers and key associates as performance
incentives. These options were granted at the closing price of the Company's
common stock on the dates of grant, vest over a three year period and must be
exercised within ten years from the date of grant.
All grants awarded to the Named Officers are reflected in the "Option/SAR
Grants In Last Fiscal Year" table herein.
15 <PAGE>
<PAGE>
CEO Compensation During 1995
The Committee agreed to increase the base salary paid to Mr. Kurtz, the
Company's Chief Executive Officer, three percent (3%) in July, 1995. The
Committee also awarded Mr. Kurtz 280,000 incentive stock options in August,
1995 pursuant to the SIP (discussed above) which reflected a desire to reward
Mr. Kurtz for achievement of certain initiatives.
/s/ John D. Platt
/s/ Dennis Pointer
/s/ Robert J. Simmons
16 <PAGE>
<PAGE>
STOCK PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage changes in
the cumulative total shareholder return on the Company's Common Stock against
the cumulative total return of the Nasdaq Market Index and a Company-selected
peer group index for the period of five fiscal years commencing January 1, 1990
and ended December 31, 1995. The peer group index was based upon the
cumulative total shareholder return of companies which were selected because
they are within the Company's industry, weighted according to their respective
stock market capitalizations.
The Peer Group consists of Medicus, GMIS, Cycare Systems and Phamis and has
been revised from the Company's previously selected peer group of American
Claims Evaluation, Cerner Corporation, Cycare Systems, General Computer, HBO &
Company, National Data Corporation, Primark Corporation and Shared Medical
Systems. Management felt that some of the companies that had been previously
represented in the peer group were no longer representative of the Company's
peers due to their significantly larger market capitalization and their
diversity in products and services. Therefore, Management selected a peer
group whose market capitalizations are more similar in value to the Company's.
The peer group's cumulative total return is weighted in a manner which
emphasizes the performance of the companies in the peer group with the largest
market capitalizations.
COMPARATIVE FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG CIS TECHNOLOGIES, INC., NASDAQ MARKET INDEX
AND PEER GROUPS
<TABLE>
<CAPTION>
FISCAL YEAR ENDING
COMPANY 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C>
CIS TECHNOLOGIES, INC. 145.76 210.17 86.44 62.71 88.14
PREVIOUS PEER GROUP 162.33 240.45 319.45 420.57 728.01
CURRENT PEER GROUP 102.17 101.69 123.75 142.18 154.18
NASDAQ MARKET 128.38 129.64 155.50 163.26 211.77
</TABLE>
Assumes $100 invested on Jan. 1, 1990
Assumes dividends reinvested
Fiscal year ending Dec. 31, 1995
17 <PAGE>
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Other than as set forth below, there has not been any transaction, or series
of similar transactions, since the beginning of the Company's last fiscal year,
or any currently proposed transactions, or series of similar transactions, to
which the Company or any of its subsidiaries was or is to be a party, in which
the amount involved exceeds $60,000 and in which any of the following persons
had, or will have, a direct or indirect material interest: any director or
executive officer of the Company, any nominee for election as a director, any
security holder known to the Company to own of record or beneficially more than
5% of the company's outstanding common stock or any member of the immediate
family of any of the foregoing persons; nor has any such person been indebted
to the Company at any time since the beginning of the Company's most recent
fiscal year in an amount in excess of $60,000 except as set forth below.
Mr. Philip D. Kurtz, President and Chief Executive Officer of the Company,
and Thomas W. Kurtz, a former officer of the Company and Philip D. Kurtz's
father, are each indebted to the Company for uncollateralized five-year
promissory notes dated April 1, 1991. Each note requires equal annual payments
of principal plus accrued interest at 6.66% per annum. Pursuant to Board
approval, principal payments due in 1995 were extended to the year following
the end of the original five-year term of the Notes. The highest amount of
such indebtedness outstanding (including accrued interest) during 1995, was
$74,949 as to Philip D. Kurtz, and $72,538 as to Thomas W. Kurtz, and the
amount outstanding as of March 31, 1996, was $56,573 as to Philip D. Kurtz and
$43,871 as to Thomas W. Kurtz. The notes resulted from 1987 loans to Messrs.
Kurtz by the Company to facilitate their exercises of warrants to purchase
common stock of the Company. The warrants had been previously granted to
Messrs. Kurtz by the Company in satisfaction of Company indebtedness to them.
All transactions between the Company and its officers, directors, principal
shareholders or other affiliates have been and will be approved by a majority
vote of the Company's disinterested directors and will be on terms believed to
be no less favorable to the Company than could be obtained from unaffiliated
third parties.
ANNUAL REPORT
The Annual Report to Shareholders of the Company for the fiscal year ended
December 31, 1995, which includes audited financial statements, has been mailed
to Shareholders contemporaneously herewith, but such Report is not incorporated
in this Proxy Statement and is not deemed to be a part of the proxy soliciting
material.
FORM 10-K
The Company will furnish without charge to each person whose Proxy is being
solicited, upon request of any such person, a copy of the Annual Report of the
Company on Form 10-K for the fiscal year ended December 31, 1995, as filed with
the Securities and Exchange Commission, including the financial statements and
schedules. Such report will be filed with the Securities and Exchange
Commission by March 30, 1996. Requests for copies of such report should be
directed to Investor Relations, C.I.S. Technologies, Inc., 6100 S. Yale, Suite
1900, Tulsa, Oklahoma 74136-1903.
PROXY SOLICITATION
The Company will bear the cost of solicitation of proxies and will reimburse
brokers, custodians, nominees and fiduciaries for their expenses in forwarding
proxy material to beneficial owners. Proxies may also be solicited personally,
by telephone or by facsimile by the directors, officers and/or regular
employees of the Company without additional compensation although no
solicitation by these means is presently contemplated.
18 <PAGE>
<PAGE>
SHAREHOLDER PROPOSALS
If any shareholder desires to present a proposal for action at the Company's
1997 annual meeting, such proposal must be received by the Company on or prior
to November 15, 1996.
SECTION 16 REQUIREMENTS
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and officers and persons who own more than 10% of a
registered class of the Company's equity securities to file initial reports of
ownership and reports of changes in ownership with the Securities and Exchange
Commission (the "SEC"). Such persons are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it with
respect to fiscal 1995, or written representations from certain reporting
persons, the Company believes that all filing requirements applicable to its
directors, officers and persons who own more than 10% of a registered class of
the Company's equity securities have been complied with, except for Messrs.
Platt, Short, Souders and Suitt, who each had one report on Form 4 filed late.
Messrs. Short and Souders terminated employment with the Company in 1995 but
were still bound by Section 16 requirements at the time of the late filing.
19 <PAGE>
EXHIBIT A
<PAGE>
STOCKHOLDER'S RESOLUTION
RESOLVED that Article IV of the Company's Certificate of Incorporation
shall be amended by adding the following paragraph after the final existing
paragraph thereof: "On the date of filing of this amendment each outstanding
share of common stock, par value $.01, shall be converted and changed into one-
half of a share of common stock, par value $.02;" and
FURTHER RESOLVED, notwithstanding the approval of the foregoing amendment
by the stockholders, the Board may abandon the foregoing amendment without
further stockholder approval, and shall abandon (1) such amendment if not
effected prior to December 31, 1998 or (2) upon the effectiveness of any other
amendment effecting a one-for-three, -four or -five reverse stock split. <PAGE>
<PAGE>
STOCKHOLDER'S RESOLUTION
RESOLVED that Article IV of the Company's Certificate of Incorporation
shall be amended by adding the following paragraph after the final existing
paragraph thereof: "On the date of filing of this amendment each outstanding
share of common stock, par value $.01, shall be converted and changed into one-
third of a share of common stock, par value $.03;" and
FURTHER RESOLVED, notwithstanding the approval of the foregoing amendment
by the stockholders, the Board may abandon the foregoing amendment without
further stockholder approval, and shall abandon (1) such amendment if not
effected prior to December 31, 1998 or (2) upon the effectiveness of any other
amendment effecting a one-for two, -four, or -five reverse stock split. <PAGE>
<PAGE>
STOCKHOLDER'S RESOLUTION
RESOLVED that Article IV of the Company's Certificate of Incorporation
shall be amended by adding the following paragraph after the final existing
paragraph thereof: "On the date of filing of this amendment each outstanding
share of common stock, par value $.01, shall be converted and changed into one-
fourth of a share of common stock, par value $.04;" and
FURTHER RESOLVED, notwithstanding the approval of the foregoing amendment
by the stockholders, the Board may abandon the foregoing amendment without
further stockholder approval, and shall abandon (1) such amendment if not
effected prior to December 31, 1998 or (2) upon the effectiveness of any other
amendment effecting a one-for two, -three or -five reverse stock split. <PAGE>
<PAGE>
STOCKHOLDER'S RESOLUTION
RESOLVED that Article IV of the Company's Certificate of Incorporation
shall be amended by adding the following paragraph after the final existing
paragraph thereof: "On the date of filing of this amendment each outstanding
share of common stock, par value $.01, shall be converted and changed into one-
fifth of a share of common stock, par value $.05;" and
FURTHER RESOLVED, notwithstanding the approval of the foregoing amendment
by the stockholders, the Board may abandon the foregoing amendment without
further stockholder approval, and shall abandon (1) such amendment if not
effected prior to December 31, 1998 or (2) upon the effectiveness of any other
amendment effecting a one-for two, -three or -four reverse stock split.<PAGE>
