<PAGE>
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 Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
NutraMax Prducts, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
X No fee required.
___ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11;
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
___ Fee paid previously with preliminary materials.
___ Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed:
<PAGE>
NUTRAMAX PRODUCTS, INC.
9 BLACKBURN DRIVE
GLOUCESTER, MASSACHUSETTS 01930
January 28, 1998
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
NutraMax Products, Inc. (the "Company") to be held on Tuesday, February 24,
1998, at 10:00 a.m., local time, at the Ocean View Inn, 171 Atlantic Road,
Gloucester, Massachusetts 01930 (the "Annual Meeting").
The Annual Meeting has been called for the purpose of (i) electing five
Directors, each to hold office until the next annual meeting of stockholders,
and (ii) voting upon such other business as may properly come before the
Annual Meeting or any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on January 27, 1998
as the record date for determining stockholders entitled to notice of and to
vote at the Annual Meeting and any adjournments or postponements thereof.
The Board of Directors of the Company recommends that you vote "FOR" the
election of the five nominees of the Board of Directors of the Company.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, YOU ARE REQUESTED TO
COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF YOU
ATTEND THE ANNUAL MEETING, YOU MAY VOTE IN PERSON IF YOU WISH, EVEN IF YOU
HAVE PREVIOUSLY RETURNED YOUR PROXY CARD.
Very truly yours,
/s/ Donald E. Lepone
Donald E. Lepone
Chief Executive Officer and
President
<PAGE>
NUTRAMAX PRODUCTS, INC.
9 BLACKBURN DRIVE
GLOUCESTER, MASSACHUSETTS 01930
(978) 283-1800
----------------
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, FEBRUARY 24, 1998
----------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of NutraMax
Products, Inc. (the "Company") will be held on Tuesday, February 24, 1998, at
10:00 a.m., local time, at the Ocean View Inn, 171 Atlantic Road, Gloucester,
Massachusetts 01930 (the "Annual Meeting") for the purpose of considering and
voting upon:
1. The election of five Directors, each to hold office until the next
annual meeting of stockholders and until their successors are elected and
qualified; and
2. Such other business as may properly come before the Annual Meeting and
any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on January 27, 1998
as the record date for determination of stockholders entitled to notice of and
to vote at the Annual Meeting and any adjournments or postponements thereof.
Only holders of common stock of record at the close of business on that date
will be entitled to notice of and to vote at the Annual Meeting and any
adjournments or postponements thereof.
In the event there are not sufficient votes with respect to the foregoing
proposals at the time of the Annual Meeting, the Annual Meeting may be
adjourned in order to permit further solicitation of proxies.
By Order of the Board of Directors
Eugene M. Schloss, Jr.
Secretary
Gloucester, Massachusetts
January 28, 1998
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
IF YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE IN PERSON IF YOU WISH, EVEN IF
YOU HAVE PREVIOUSLY RETURNED YOUR PROXY CARD.
<PAGE>
NUTRAMAX PRODUCTS, INC.
9 BLACKBURN DRIVE
GLOUCESTER, MASSACHUSETTS 01930
(978) 283-1800
----------------
PROXY STATEMENT
----------------
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, FEBRUARY 24, 1998
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of NutraMax Products, Inc., a Delaware
corporation (the "Company"), for use at the Annual Meeting of Stockholders of
the Company to be held on Tuesday, February 24, 1998, at 10:00 a.m., local
time, at the Ocean View Inn, 171 Atlantic Road, Gloucester, Massachusetts
01930, and any adjournments or postponements thereof (the "Annual Meeting").
At the Annual Meeting, stockholders of the Company will be asked to consider
and vote upon the following matters:
1. The election of five Directors, each to hold office until the next
annual meeting of stockholders and until their successors are elected and
qualified; and
2. Such other business as may properly come before the Annual Meeting and
any adjournments or postponements thereof.
The Notice of the Annual Meeting, Proxy Statement and Proxy Card are first
being mailed to stockholders of the Company on or about January 28, 1998 in
connection with the solicitation of proxies for the Annual Meeting. The Board
of Directors has fixed the close of business on January 27, 1998 as the record
date for the determination of stockholders entitled to notice of and to vote
at the Annual Meeting (the "Record Date"). Only holders of Common Stock of
record at the close of business on the Record Date will be entitled to notice
of and to vote at the Annual Meeting. As of the Record Date, there were
6,293,516 shares of the Company's Common Stock outstanding and entitled to
vote at the Annual Meeting and 356 stockholders of record. Each holder of a
share of Common Stock outstanding as of the close of business on the Record
Date will be entitled to one vote for each share held of record for each
matter properly submitted at the Annual Meeting.
The presence, in person or by proxy, of one-third of the total number of
outstanding shares of Common Stock is necessary to constitute a quorum for the
transaction of business at the Annual Meeting. A quorum being present, the
affirmative vote of a plurality of the votes cast is necessary to elect a
nominee as a Director of the Company. Shares that reflect abstentions or
"broker non-votes" (i.e., shares represented at the meeting held by brokers or
nominees as to which instructions have not been received from the beneficial
owners or persons entitled to vote such shares and with respect to which the
broker or nominee does not have discretionary voting power to vote such
shares) will be counted for purposes of determining whether a quorum is
present for the transaction of business at the meeting. With respect to the
election of Directors, votes may only be cast in favor of or withheld from
each nominee; votes that are withheld will be excluded entirely from the vote
and will have no effect.
STOCKHOLDERS OF THE COMPANY ARE REQUESTED TO COMPLETE, DATE, SIGN AND RETURN
THE ACCOMPANYING PROXY CARD IN THE ENCLOSED ENVELOPE. SHARES OF COMMON STOCK
REPRESENTED BY PROPERLY EXECUTED PROXIES RECEIVED BY THE COMPANY AND NOT
REVOKED WILL BE VOTED AT THE ANNUAL MEETING IN ACCORDANCE WITH THE
INSTRUCTIONS CONTAINED THEREIN. IF INSTRUCTIONS ARE NOT GIVEN THEREIN,
PROPERLY EXECUTED PROXIES WILL BE
1
<PAGE>
VOTED "FOR" THE ELECTION OF THE FIVE NOMINEES FOR DIRECTOR LISTED IN THIS
PROXY STATEMENT. IT IS NOT ANTICIPATED THAT ANY OTHER MATTERS WILL BE
PRESENTED AT THE ANNUAL MEETING. IF OTHER MATTERS ARE PRESENTED, PROXIES WILL
BE VOTED IN ACCORDANCE WITH THE DISCRETION OF THE PROXY HOLDERS.
Any properly completed proxy may be revoked at any time before it is voted
on any matter (without, however, affecting any vote taken prior to such
revocation) by giving written notice of such revocation to the Secretary of
the Company, or by signing and duly delivering a proxy bearing a later date,
or by attending the Annual Meeting and voting in person.
The Annual Report of the Company (the "Annual Report") for the fiscal year
ended September 27, 1997 ("Fiscal 1997") is being mailed to stockholders of
the Company concurrently with this Proxy Statement. The Annual Report,
however, is not a part of the proxy solicitation material.
PROPOSAL NUMBER 1
ELECTION OF DIRECTORS
The Board of Directors of the Company currently consists of five members.
All Directors are elected annually and serve until the next annual meeting of
stockholders and until the election and qualification of their successors. At
the Annual Meeting, five Directors will be elected to serve until the next
annual meeting. The Board of Directors has nominated Donald M. Gleklen,
Bernard J. Korman, Donald E. Lepone, Dennis M. Newnham and David M. Schulte
for re-election. Unless otherwise specified in the proxy, it is the intention
of the persons named in the proxy to vote the shares represented by each
properly executed proxy for the re-election of Messrs. Gleklen, Korman,
Lepone, Newnham and Schulte as Directors. Each of the nominees has agreed to
stand for re-election and to serve if re-elected as a Director. However, if
any of the persons nominated by the Board of Directors fails to stand for re-
election or is unable to accept re-election, the proxies will be voted for the
election of such other person or persons as the Board of Directors may
recommend.
A quorum being present, the affirmative vote of a plurality of the votes
cast is necessary to elect a nominee as a Director of the Company. THE BOARD
OF DIRECTORS OF THE COMPANY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE
FOR THE RE-ELECTION OF THE FIVE NOMINEES OF THE BOARD OF DIRECTORS AS
DIRECTORS OF THE COMPANY.
INFORMATION REGARDING DIRECTORS
The Board of Directors of the Company held eight meetings during Fiscal
1997. During Fiscal 1997, each of the incumbent Directors attended at least
75% of the total number of meetings of the Board of Directors (held while he
was a Director) and of the committees of which he was a member. The Board of
Directors has established an Audit Committee and a Compensation and Stock
Option Committee. The Audit Committee reviews the financial statements of the
Company and the scope of the annual audit, monitors the Company's internal
financial and accounting controls and recommends to the Board of Directors the
appointment of independent certified public accountants. Messrs. Korman and
Newnham were members of the Audit Committee during all of Fiscal 1997. Michael
F. Sandler and Frederick W. McCarthy, each a former Director of the Company,
served on the Audit Committee until December 20, 1996. Donald M. Gleklen
served on the Audit Committee for the balance of Fiscal 1997 commencing on
December 20, 1996. The Audit Committee met one time during Fiscal 1997. The
Compensation and Stock Option Committee recommends the compensation levels of
officers and employees of the Company to the Board of Directors and is
responsible for administering the Company's 1988 Stock Option Plan (the "1988
Option Plan") and the Company's 1996 Stock Option Plan (the "1996 Stock Option
Plan"). Messrs. Korman, Gleklen and Newnham were members of the Compensation
and Stock Option Committee from December 20, 1996 through the end of Fiscal
1997. Prior to that date, the Board of Directors had separate Compensation and
Stock Option Committees. From the beginning of Fiscal 1997 through December
20, 1996, the Compensation Committee consisted of Messrs. Korman, Newnham and
Lepone, and Mr. McCarthy, a former Director. During the same period, the Stock
Option Committee consisted of Messrs. Newnham and McCarthy.
2
<PAGE>
The Compensation Committee (and after December 20, 1996, the Compensation and
Stock Option Committee) met two times during Fiscal 1997. The Board of
Directors does not have a nominating committee.
Directors who are officers or employees of the Company receive no
compensation for service as Directors. Non-employee Directors each receive
$2,500 for their service as Directors for each in-person meeting which they
attend. In addition, in 1991 each non-employee Director received options under
the 1988 Option Plan to purchase 25,000 shares of Company Common Stock at
$6.00 per share, vesting in equal installments over the subsequent five years
beginning on the first anniversary of the grant date. In 1996, each non-
employee director received options under the 1996 Stock Option Plan to
purchase shares of Company Common Stock at $9.875 per share (Mr. Korman,
28,000 shares; Mr. Gleklen, 17,500 shares; Mr. Newnham, 17,500 shares), one-
fifth of which vested on the grant date and the remaining four-fifths of which
vest ratably over four years beginning on the first anniversary of the grant
date. All Directors are reimbursed for expenses incurred in connection with
attendance at meetings.
Set forth below is certain information regarding the Directors of the
Company, including the five Directors who have been nominated for re-election
at the Annual Meeting, based on information furnished by them to the Company.
<TABLE>
<CAPTION>
NAME AGE DIRECTOR SINCE
---- --- --------------
<S> <C> <C>
Donald M. Gleklen....................................... 61 1990
Bernard J. Korman....................................... 66 1990
Donald E. Lepone........................................ 53 1987
Dennis M. Newnham....................................... 57 1987
David M. Schulte........................................ 51 1997
</TABLE>
The principal occupation and business experience during at least the last
five years for each Director of the Company is set forth below.
MR. GLEKLEN has been a Director of the Company since 1990. Mr. Gleklen is
also President of Jocard Financial Services (financial consulting services), a
position he has held since September 1994, and he has been Chairman and Chief
Executive Officer of Intellihealth, Inc. since July 1996 (provider of health
care information to consumers). Mr. Gleklen served as Senior Vice President of
Corporate Development of MEDIQ Incorporated from 1985 to March 1994. Mr.
Gleklen also served as Managing Partner of Brobyn Capital Partners (venture
capital) from March 1994 to September 1994 and he currently serves as a
Director of New West Eyeworks, Inc. (retail eyewear stores) and Lason, Inc.
(provider of laser printing and imaging services). He also is the President
and Chief Executive Officer of The Maine Merchant Bank, a position he has held
since September 1997.
MR. KORMAN has been Chairman of the Board of Directors of the Company since
August 1990. Mr. Korman served as President, Chief Executive Officer and a
Director of MEDIQ Incorporated from 1977 to 1995. Mr. Korman is a Director of
Kapson Senior Quarters Corp. (assisted living services), The New America High
Income Fund, Inc. (financial services), The Pep Boys, Inc. (automotive
supplies), Today's Man, Inc. (retail men's clothing sales), Omega Healthcare
Investors, Inc. (real estate investment trust), InnoServ Technologies, Inc.
(medical equipment support services) and Kranzco Realty Trust (real estate
investment trust).
MR. LEPONE has been President, Chief Executive Officer and a Director of the
Company since 1987.
MR. NEWNHAM has been a Director of the Company since 1987. Mr. Newnham has
been President and Chief Executive Officer of Tsumura International since
March 1996. Before joining Tsumura International, Mr. Newnham was Chairman,
President and Chief Executive Officer of Adirondack Beverages, Inc. from
March 1995 to December 1995. Mr. Newnham was a venture capitalist consultant
from March 1994 to March 1995. Mr. Newnham previously served as President and
Chief Executive Officer of Lea & Perrins, Inc. (manufacturer of condiments)
from 1983 to February 1994. Mr. Newnham is also a director of United Water
Resources (a holding company for water related businesses).
3
<PAGE>
MR. SCHULTE has been Managing Partner of Chilmark Partners, L.L.C., a
merchant banking firm in Chicago, and its predecessor, since 1984. Chilmark
Partners, L.L.C. is a partner in Chilmark Fund II, L.P., an investment
partnership.
EXECUTIVE OFFICERS
The names and ages of all executive officers of the Company and the
principal occupation and business experience during at least the last five
years for each are set forth below.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Robert F. Burns......... 48 Vice President, Chief Financial Officer and Treasurer
Gary Lande.............. 58 Vice President of Supply Chain Management
Donald E. Lepone........ 53 President and Chief Executive Officer
John J. Manheimer....... 50 Vice President of Sales
James W. McGrath, Jr.... 53 Vice President of Regulatory Affairs and Technical Services
Richard C. Zakin........ 40 Vice President of Marketing
</TABLE>
MR. BURNS is a certified public accountant and has been Vice President,
Chief Financial Officer and Treasurer of the Company since August 1994. From
1984 to August 1994, Mr. Burns served as Vice President of Finance for Tetley,
Inc. (tea and coffee manufacturer), a subsidiary of Allied-Lyons PLC.
MR. LANDE has been Vice President of Supply Chain Management since December
1997. From May 1994 to December 1997, Mr. Lande was Vice President of
Logistics at Beirsdorf. From September 1990 to May 1994, Mr. Lande was
Director of Materials Management for Fisons Pharmaceuticals, Inc.
MR. LEPONE has been President and Chief Executive Officer of the Company
since 1987.
MR. MANHEIMER has been Vice President of Sales for the Company since 1990.
MR. MCGRATH has been Vice President of Regulatory Affairs and Technical
Services for the Company since August 1994, and was Vice President of
Operations for the Company from July 1993 to August 1994. He served as
Director of Quality Assurance and Quality Control for the Company from
September 1992 to June 1993. Mr. McGrath previously served as Director of
Quality Assurance for Circa Pharmaceutical Co., Inc. (pharmaceutical
manufacturer) from May 1991 to July 1992. He also served as Vice President of
Technical Services for Nice-Pak Products (pharmaceutical and consumer products
manufacturer) from March 1990 to May 1991.
MR. ZAKIN has been Vice President of Marketing for the Company since June
1993. He served as Vice President and General Manager of the Company from
September 1992 to June 1993 and Vice President of Marketing for the Company
from July 1990 to September 1992.
Each of the executive officers holds his respective office until the regular
annual meeting of the Board of Directors following the annual meeting of
stockholders and until his successor is elected and qualified or until his
earlier resignation or removal.
OTHER KEY EMPLOYEES
In addition to the Directors and executive officers listed above, the
following individuals are also expected to make significant contributions to
the business of the Company.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Michael C. Bill......... 44 Vice President and General Manager, Ophthalmics Division
William A. Gelinas...... 49 Vice President and General Manager, Oral Care Division
William Muth, Jr........ 49 Vice President and General Manager, Adhesive Coatings Division
Jorge L. Perez.......... 59 Vice President and General Manager, First Aid Division
Scott C. Sicular........ 46 Vice President and General Manager, Cough/Cold Division
</TABLE>
4
<PAGE>
EXECUTIVE COMPENSATION
The following sections of this Proxy Statement set forth and discuss the
compensation paid or awarded during the last three years to the Company's Chief
Executive Officer and the four most highly compensated executive officers who
earned in excess of $100,000 during Fiscal 1997.
SUMMARY COMPENSATION TABLE
The following table shows for each of the last three fiscal years
compensation paid by the Company to the Chief Executive Officer and the four
most highly compensated executive officers who earned in excess of $100,000
during Fiscal 1997.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION
-------------------------- -----------------------
PAYOUTS
------------
AWARDS
SECURITIES
UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY(1)($) BONUS($) OPTIONS(#) COMPENSATION
- --------------------------- ---- ------------ -------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Donald E. Lepone............. 1997 324,000 -- -- 5,800(2)
President and Chief Execu-
tive Officer 1996 309,375 200,000 -- 7,300
1995 290,000 100,000 -- 7,000
Richard C. Zakin............. 1997 184,000 35,000 50,000 6,300(3)
Vice President of Marketing 1996 167,000 47,500 -- 6,200
1995 157,000 39,000 20,000 6,000
John J. Manheimer............ 1997 164,000 25,000 35,000 5,800(4)
Vice President of Sales 1996 152,000 30,000 -- 6,700
1995 143,000 25,000 20,000 6,000
Robert F. Burns.............. 1997 146,000 21,000 25,000 5,800(5)
Vice President, Chief Finan-
cial Officer 1996 136,000 22,000 -- 3,800
and Treasurer 1995 127,000 14,000 10,000 2,000
James W. McGrath, Jr......... 1997 124,000 17,000 25,000 5,200(6)
Vice President of Regulatory
Affairs and 1996 116,000 12,000 -- 4,800
Technical Services 1995 106,000 10,000 10,000 5,000
</TABLE>
- --------
(1) Includes all voluntary pre-tax contributions to the NutraMax Products, Inc.
Employee's Savings Plan (the "401(k) Plan").
(2) Includes approximately $5,100 representing the Company's contribuions to
the 401(k) Plan account ("Company 401(k) Plan Contributions") of Mr. Lepone
and $700 of group life insurance expenses paid by the Company ("Group Life
Insurance Expenses") on behalf of Mr. Lepone.
(3) Includes approximately $5,100 of Company 401(k) Plan Contributions, $500 of
automobile expenses and $700 of Group Life Insurance Expenses.
(4) Includes approximately $5,100 of Company 401(k) Plan Contributions and $700
of Group Life Insurance Expenses.
(5) Includes approximately $5,100 of Company 401(k) Plan Contributions and $700
of Group Life Insurance Expenses.
(6) Includes approximately $4,500 of Company 401(k) Plan Contributions and $700
of Group Life Insurance Expenses.
5
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END VALUES
The following table sets forth the shares acquired and the value realized
upon exercise of stock options during Fiscal 1997 by the Chief Executive
Officer and each other executive officer named in the Summary Compensation
Table and certain information concerning the number and value of unexercised
options.
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF SECURITIES UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT FY-END(#) OPTIONS AT FY-END($)(1)
ACQUIRED VALUE ------------------------- -------------------------
ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
-------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Donald E. Lepone........ 50,000 187,500 100,000 400,000 337,500 1,350,000
Richard C. Zakin........ 25,000 84,375 46,000 44,000 167,500 200,000
John J. Manheimer....... -- -- 43,000 32,000 154,000 146,000
Robert F. Burns......... -- -- 11,000 24,000 51,000 109,000
James W. McGrath, Jr.... -- -- 18,000 22,000 72,125 99,750
</TABLE>
- --------
(1) Equal to the market value of shares covered by in-the-money options as of
the end of the Company's fiscal year on September 27, 1997 less the
aggregate option exercise price. Options are in-the-money if the market
value of the shares covered thereby is greater than the option exercise
price.
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth the options granted in Fiscal 1997 to the
Chief Executive Officer and each other executive officer named in the Summary
Compensation Table.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES
OF SHARE PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
-------------------------------------------------------------- ---------------------
NUMBER OF PERCENT OF TOTAL
SHARES UNDERLYING OPTIONS GRANTED
OPTIONS TO EMPLOYEES EXERCISE OR BASE EXPIRATION
NAME GRANTED (#) (A) IN FISCAL YEAR PRICE ($/SH) (B) DATE 5%($) 10%($)
- ---- ----------------- ---------------- ---------------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Donald E. Lepone........ -- -- -- -- -- --
Richard C. Zakin........ 50,000 27% 9.875 12/20/01 136,414 301,439
John J. Manheimer....... 35,000 19% 9.875 12/20/01 95,490 211,008
Robert F. Burns......... 25,000 14% 9.875 12/20/01 68,207 150,720
James W. McGrath, Jr.... 25,000 14% 9.875 12/20/01 68,207 150,720
</TABLE>
- --------
(a) One-fifth of each option vested on the grant date and the remaining four-
fifths vests ratably over four years beginning on the first anniversary of
the grant date.
(b) Represents the closing market price of the Company's Common Stock on the
grant date of December 20, 1996.
REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEE OF THE BOARD OF
DIRECTORS ON EXECUTIVE COMPENSATION
The Compensation and Stock Option Committee of the Board of Directors of the
Company currently consists of Bernard J. Korman, Donald M. Gleklen and Dennis
M. Newnham, each of whom are outside directors. Prior to December 20, 1996,
the Board of Directors had separate Compensation and Stock Option Committees.
From the beginning of Fiscal 1997 through December 20, 1996, the Compensation
Committee consisted of Messrs. Korman, Newnham and Lepone, and Mr. McCarthy, a
former Director. During the same period, the Stock Option Committee consisted
of Messrs. Newnham and McCarthy. Mr. McCarthy, a former outside Director of
the Company, served as a member of the Compensation Committee until December
20, 1996. The Compensation and Stock Option Committee approves the Company's
compensation policies and procedures, establishes compensation levels for
executive officers and administers the Company's stock option plans.
6
<PAGE>
Mr. Lepone does not participate in Compensation and Stock Option Committee
deliberations concerning his compensation but makes general recommendations to
and reviews with the Compensation and Stock Option Committee the compensation
of other executives and management.
GENERAL
The compensation arrangements of the Company reflect the philosophy of the
Compensation and Stock Option Committee, and the Board of Directors as a whole,
that a significant portion of the annual compensation of the Company's Chief
Executive Officer and other executive officers should be linked to the
Company's performance. The Company's compensation programs are designed to
provide competitive financial rewards for successfully meeting the Company's
strategic and operating objectives, with the purposes of retaining personnel
and supporting a performance-oriented environment. Where applicable, the
Compensation and Stock Option Committee takes into account the employment
agreement between an executive officer and the Company. See "Employment
Agreements" below.
COMPENSATION POLICIES FOR EXECUTIVE OFFICERS
The compensation of the Company's Chief Executive Officer and other executive
officers consists of annual salary and cash and stock incentives based on
annual and long-term performance of the Company.
Base Salary. The annual base salary and base salary adjustments for executive
officers are determined by the Compensation and Stock Option Committee in its
discretion and are targeted according to the salaries of executives holding
similar offices and having similar responsibilities within the private label
health and personal care products industry. The Compensation and Stock Option
Committee also considers factors such as industry experience and executive
retention. Based upon the foregoing criteria, the base salary for Mr. Lepone
was established pursuant to his employment agreement as described below under
"Employment Agreements." Generally, salary adjustments for executive officers
(whether determined annually with respect to such officers or pursuant to
employment agreements) are determined by evaluating the competitive marketplace
(including the Company's industry segment), the performance of the Company, the
performance of the executive officer and any change in the responsibilities
assumed by the executive officer. While many aspects of performance can be
measured in financial terms, the Compensation and Stock Option Committee also
evaluates the success of executive officers in areas of non-financial
performance, such as the development and implementation of objectives and
plans. Salary adjustments are normally determined and made on an annual basis.
Salary adjustments for the Chief Executive Officer were established pursuant to
his employment agreement. See "Employment Agreements" below.
Cash Bonuses. The Company has an incentive compensation plan (the
"Compensation Plan") pursuant to which the Company's executive officers are
awarded cash bonuses based upon individual performance and the Company's
achievement of certain internal financial objectives. The Compensation Plan
provides for annual cash bonuses ranging from 2% to 60% of the executive
officer's base salary, with executive officers becoming entitled to receive a
percentage of their bonus potential based upon the percentage achievement of
the Company's internal operating objectives and, with respect to executive
officers other than the Chief Executive Officer, also on such executive
officers' individual performance. These objectives include pre-tax income
targets, product line sales growth targets (for sales and marketing
executives), productivity objectives (for operations executives), material
price targets (for purchasing managers), timely information reporting and
working capital control objectives (for financial managers) and regulatory
compliance and control and new product development objectives (for regulatory
affairs and product development managers). The Chief Executive Officer's bonus
is determined solely by the Company's achievement of pre-tax income targets
while bonuses for all other executive officers are determined by the Company's
achievement of pre-tax income targets and the achievement by such officers of
their individual performance targets. Executive officers other than the Chief
Executive Officer may receive bonuses even if the Company does not achieve the
pre-tax income targets. Through the Compensation Plan, a significant portion of
each executive officer's annual total compensation is placed at risk in order
to provide an incentive toward sustained high performance. For Mr. Lepone, the
Chief Executive Officer of the
7
<PAGE>
Company, the bonus potential is entirely dependent upon the Company's
operating performance, without regard to individual achievements. For Fiscal
1996, Mr. Lepone received a bonus of $200,000 as a result of the achievement
of the applicable pre-tax income targets. For Fiscal 1996, Messrs. Zakin and
Manheimer received bonuses of $47,500 and $30,000, respectively, as a result
of the achievement of the applicable pre-tax income targets and product line
sales growth targets; Mr. Burns received a bonus of $22,000 as a result of the
achievement of the applicable pre-tax income targets and timely information
reporting and working capital control objectives; and Mr. McGrath received a
bonus of $12,000 as a result of the achievement of the applicable pre-tax
income targets and regulatory compliance and control and product development
objectives. For Fiscal 1997, based on the same criteria, Mr. Lepone received
no bonus and Messrs. Zakin, Manheimer, Burns and McGrath received bonuses of
$35,000, $25,000, $21,000 and $17,000, respectively.
Equity Incentives. Equity incentive awards are designed to attract and
retain executives who can make significant contributions to the Company's
success, reward executives for such significant contributions and give
executives a longer-term incentive to increase stockholder value. The size and
frequency of equity and equity-based incentive awards are determined by the
Compensation and Stock Option Committee in its discretion, taking into account
individual performance and responsibilities, and in most cases, without any
specific performance measures. The Compensation and Stock Option Committee
may, however, impose specific performance measures on stock option grants. The
Compensation and Stock Option Committee also may grant stock options for
executive retention purposes in amounts that the Compensation and Stock Option
Committee, in its discretion, deems necessary and appropriate in order to
retain highly qualified executives. To ensure that high levels of performance
occur over the long-term, stock options granted to executives typically vest
over a period of four years. All outstanding options have been granted with an
exercise price equal to 100% of the fair market value of the Company's Common
Stock on the grant date. Any value received by an executive officer from a
stock option grant and any increase in the value of stock received as a bonus
depends entirely on increases in the price of the Company's Common Stock.
Since the adoption of the 1988 Option Plan, the Company's executive officers
have all been granted options to acquire shares of the Company's Common Stock.
During Fiscal 1997, Mr. Zakin, Manheimer, Burns and McGrath received options
to purchase 50,000, 35,000, 25,000 and 25,000 shares of Common Stock,
respectively. One-fifth of each option vested on the grant date and the
remaining four-fifths vests ratably over four years beginning on the first
anniversary of the grant date.
Other Compensation. The Company provides executive officers and management
with health, retirement and other benefits under plans that are generally
available to the Company's employees.
Compensation of the Chief Executive Officer. Mr. Lepone's base salary, base
salary adjustments and performance targets for the award of any cash bonuses
are governed by Mr. Lepone's employment agreement. Any increases in Mr.
Lepone's compensation are determined by the Compensation and Stock Option
Committee based upon an analysis of his performance during the year and the
Company's overall performance. Under the terms of his employment agreement,
which expires in 1998, Mr. Lepone is currently entitled to receive an annual
base salary of $339,000 ($324,000 for Fiscal 1997), subject to a minimum
annual increase equal to the greater of 5% or the annual inflation rate. Mr.
Lepone also participates in the Compensation Plan, as described above. In
addition, pursuant to the terms of his employment agreement, Mr. Lepone was
granted options to acquire at $11.00 per share, up to 500,000 shares of the
Company's Common Stock under the 1988 Option Plan. The options vested with
respect to 100,000 shares on the date of grant and vest with respect to an
additional 100,000 shares at the end of each of fiscal 1995, 1996, 1997 and
1998, depending upon the Company attaining and maintaining a 15% compounded
annual stock price growth rate; provided, however, that such vesting may
accelerate under certain circumstances, such as a change of control of the
Company. For Fiscal 1996 and Fiscal 1997, no additional vesting of these
options occurred. In connection with the Company's review of strategic
alternatives in 1996 which resulted in the Company's repurchase of the Common
Stock of the Company previously owned by MEDIQ Incorporated, the Compensation
and Stock Option Committee and the Board of Directors determined that the
interests of the Company and its stockholders would best be served by
maintaining management stability. Accordingly, the Compensation and Stock
Option Committee and the Board of Directors voted to amend the terms of Mr.
Lepone's options to provide that all options that had not previously vested
would vest at the end of fiscal 1998.
8
<PAGE>
Federal Tax Regulations Limiting Deductibility of Certain Compensation. As a
result of Section 162(m) of the Code, a company's deduction of executive
compensation may be limited to the extent that a "covered employee" (i.e., the
chief executive officer or one of the four highest compensated officers who is
employed on the last day of the company's taxable year and whose compensation
is reported in the summary compensation table in the company's proxy
statement) receives compensation in excess of $1 million in such taxable year
of the company (other than performance-based compensation that otherwise meets
the requirements of Section 162(m) of the Code).
COMPENSATION AND STOCK OPTION COMMITTEE OF THE BOARD OF DIRECTORS
Bernard J. Korman
Donald M. Gleklen
Dennis M. Newnham
COMPENSATION AND STOCK OPTION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Lepone, Chief Executive Officer and President of the Company, was a
member of the Compensation Committee until December 20, 1996 and makes general
recommendations to and reviews with the Compensation and Stock Option
Committee the compensation of executives and management other than himself.
STOCKHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total stockholder return on the Company's Common Stock, based
on the market price of the Company's Common Stock and assuming reinvestment of
dividends, with the total return of companies within the Russell 2000 Index
and the companies within the NASDAQ Pharmaceutical Index prepared by Research
Data Group, Inc. (Research:). The calculation of total cumulative return
assumes a $100 investment in the Company's Common Stock, the Russell 2000
Index and the NASDAQ Pharmaceutical Index on September 30, 1992. The
comparisons in this line graph are historical and are not intended to forecast
or be indicative of possible future performance of the Common Stock of the
Company.
[GRAPH APPEARS HERE]
[PLOT POINTS APPEAR ON NEXT PAGE]
9
<PAGE>
TABULAR REPRESENTATION OF DATA POINTS USED IN GRAPH
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN
-----------------------------------------
9/92 9/93 9/94 9/95 9/96 9/97
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
NUTRAMAX PRODUCTS, INC................ 100.00 181.82 125.76 121.21 112.12 171.21
RUSSELL 2000.......................... 100.00 133.25 136.66 168.77 190.81 254.29
NASDAQ PHARMACEUTICAL................. 100.00 100.08 86.97 128.07 154.38 172.25
</TABLE>
EMPLOYMENT AGREEMENTS
On November 28, 1993, Mr. Lepone entered into an employment agreement with
the Company (the "Lepone Employment Agreement"), pursuant to which Mr. Lepone
serves as President and Chief Executive Officer of the Company through
November 30, 1998. Under the Lepone Employment Agreement, Mr. Lepone received
a base salary of $265,000 through November 30, 1994. Thereafter, the Lepone
Employment Agreement provides that such base salary shall be increased at an
annual rate of the greater of 5% or the annual rate of inflation as described
in the Consumer Price Index "All Cities--All Consumers" prepared by the Bureau
of Labor Statistics of the United States Department of Labor, or by such
greater amount as the Company and Mr. Lepone may otherwise agree. For Fiscal
1997 Mr. Lepone's salary was $324,000 and for the current fiscal year his
salary is $339,000. Pursuant to the Lepone Employment Agreement, Mr. Lepone is
entitled to receive a cash bonus if certain performance criteria are satisfied
(as discussed above under "Report of the Compensation and Stock Option
Committee of the Board of Directors on Executive Compensation") ranging from
20% to 60% of his base salary. In the event Mr. Lepone's employment is
terminated without cause, he is entitled to receive a sum equal to the
compensation then due him for the balance of the term of the Lepone Employment
Agreement at the annual rate of compensation to which he is entitled as of the
date of such termination. Mr. Lepone is subject to certain non-competition
provisions during the term of his employment and, in certain circumstances,
for a period of one year subsequent to his leaving the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On December 31, 1996 pursuant to the terms of an Amended and Restated Stock
Purchase Agreement dated november 20, 1996 among MEDIQ Incorporated, MEDIQ
Investment Services, Inc. (collectively, "MEDIQ") and the Company, the Company
purchased from MEDIQ all 4,037,258 shares of the Company's common stock owned
by MEDIQ (the "MEDIQ Shares"), of which 657,192 were held in escrow (the
"MEDIQ Escrowed Shares") as of January 26, 1998 in support of MEDIQ's 7.5%
Subordinated Debentures due 2003 (the "MEDIQ Bonds"). The aggregate purchase
price of the MEDIQ Shares was $36,335,000 representing a purchase price of
$9.00 per share (the "Purchase Price"). The Company paid MEDIQ $19,963,000 of
the $36,335,000 purchase price in cash and delivered to MEDIQ a promissory
note (the "MEDIQ Note") for the remaining $16,372,000 of the purchase price.
The balance of the note as of September 27, 1997 was $5,915,000. The MEDIQ
Note is payable in installments as MEDIQ Escrowed Shares are released from
escrow, pursuant to the indenture and escrow agreement relating to the MEDIQ
Bonds, together with interest at the annual rate of 7.5%, reduced, however, to
5%, 4% and 3% if the note remains outstanding longer than 18, 30, and 42
months, respectively.
10
<PAGE>
PRINCIPAL AND MANAGEMENT STOCKHOLDERS
The following table sets forth, to the best knowledge and belief of the
Company, certain information regarding the beneficial ownership of the Common
Stock of the Company as of January 26, 1998 by (i) each person known by the
Company to be the beneficial owner of more than 5% of the outstanding Common
Stock, (ii) each of the Company's Directors and executive officers, (iii) each
of the named executive officers in the Summary Compensation Table, and (iv)
all of the Company's executive officers and Directors as a group.
<TABLE>
<CAPTION>
SHARES
DIRECTORS, EXECUTIVE OFFICERS BENEFICIALLY PERCENT
AND 5% STOCKHOLDERS OWNED(1) OF CLASS(2)
- ----------------------------- ------------ -----------
<S> <C> <C>
Cape Ann Investors, L.L.C.(3)......................... 1,008,168 17.9%
Chilmark Fund II, L.P.
Chilmark II, L.L.C.
Chilmark Partners, L.L.C.
David M. Schulte
875 North Michigan Avenue, Suite 2100
Chicago, Illinois 60611
Wellington Management Company, LLP(4)................. 587,000 10.4%
75 State Street
Boston, Massachusetts 02109
Warburg, Pincus Counselors, Inc.(5)................... 596,100 10.6%
466 Lexington Avenue
New York, NY 10017
Robert Fleming Inc.(6)................................ 471,800 8.4%
320 Park Avenue, 11th Floor
New York, NY 10022
FMR Corp.(7).......................................... 300,000 5.3%
82 Devonshire Street
Boston, Massachusetts 02109
Robert F. Burns(8).................................... 16,200 *
Donald M. Gleklen(9).................................. 34,507 *
Bernard J. Korman(10)................................. 166,873 3.0%
Gary Lande............................................ 0 *
Donald E. Lepone(11).................................. 551,384 9.6%
John J. Manheimer(12)................................. 46,636 *
James W. McGrath, Jr.(13)............................. 22,316 *
Dennis M. Newnham(14)................................. 9,000 *
Richard C. Zakin(15).................................. 131,270 2.3%
All directors and executive officers as a group (10
persons)(16).......................................... 1,986,354 33.9%
</TABLE>
- --------
*Less than 1%.
11
<PAGE>
(1) Beneficial share ownership is determined pursuant to Rule 13d-3 under the
Exchange Act. Accordingly, a beneficial owner of a security includes any
person who, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise has or shares the power to vote
such security or the power to dispose of such security. The amounts set
forth above as beneficially owned include shares owned, if any, by spouses
and relatives living in the same home as to which beneficial ownership may
be disclaimed. The amounts set forth as beneficially owned include shares
of Common Stock which such persons had the right to acquire within 60 days
of January 26, 1998, pursuant to stock options.
(2) Percentages are calculated on the basis of 5,636,324 shares of Common
Stock outstanding of January 26, 1998, which excludes 657,192 shares of
Common Stock that are MEDIQ Escrowed Shares.
(3) The above information is based on copies of a statement on Schedule 13D/A
filed with the SEC on December 5, 1997, which indicates that Cape Ann
Investors, L.L.C. has shared voting and dispositive power with respect to
1,003,168 shares, and that each of Chilmark Fund II, L.P., Chimark II,
L.L.C., Chilmark Partners, L.L.C. and David M. Schulte has shared voting
and dispositive power with respect to all 1,008,168 shares.
(4) The above information is based on copies of a statement on Schedule 13G/A
filed with the SEC on April 9, 1997, which indicates that Wellington
Management Company, LLP has shared voting power with respect to 363,000
shares and shared dispositive power with respect to all 587,000 shares.
(5) The above information is based on copies of a statement on Schedule 13G
filed with the SEC on February 8, 1996, which indicates that Warburg,
Pincus Counsellors, Inc. has sole voting power with respect to
430,100 shares, shared voting power with respect to 81,100 shares and sole
dispositive power with respect to all 596,100 shares.
(6) The above information is based on copies of a statement on Schedule 13G
filed with the SEC on March 19, 1997, which indicates that Robert Fleming,
Inc. has sole voting and dispositive power with respect to all 471,800
shares.
(7) The above information is based on copies of a statement on Schedule 13G/A
filed with the SEC on January 12, 1998, which indicates that FMR Corp. has
sole dispositive power with respect to all 300,000 shares.
(8) Includes 16,000 shares deemed to be beneficially owed by Mr. Burns which
are subject to options previously granted pursuant to the 1988 Option Plan
and 1996 Stock Option Plan.
(9) Includes 7,000 shares deemed to be beneficially owned by Mr. Gleklen which
are subject to options previously granted pursuant to the 1996 Stock
Option Plan.
(10) Includes 11,200 shares deemed to be beneficially owned by Mr. Korman
which are subject to options previously granted pursuant to the 1996
Stock Option Plan.
(11) Includes 100,000 shares deemed to be beneficially owned by Mr. Lepone
which are subject to options previously granted pursuant to the 1988
Option Plan.
(12) Includes 45,750 shares deemed to be beneficially owned by Mr. Manheimer
which are subject to options previously granted pursuant to the 1988
Option Plan and 1996 Stock Option Plan.
(13) Includes 21,808 shares deemed to be beneficially owned by Mr. McGrath
which are subject to options previously granted pursuant to the 1988
Option Plan and 1996 Stock Option Plan.
(14) Includes 7,000 shares deemed to be beneficially owned by Mr. Newnham
which are subject to options previously granted pursuant to the 1996
Stock Option Plan.
(15) Includes 27,000 shares deemed to be beneficially owned by Mr. Zakin which
are subject to options previously granted pursuant to the 1988 Option
Plan and 1996 Stock Option Plan.
(16) Includes an aggregate of 235,758 shares deemed to be beneficially owned
by executive officers and directors which are subject to options.
Includes 1,008,168 shares as to which David M. Schulte has shared voting
and dispositive power (see Note (3) above).
12
<PAGE>
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
The Company's executive officers and Directors and beneficial owners of more
than 10% of its Common Stock are required under Section 16(a) of the Exchange
Act to file reports of ownership and changes in ownership with the SEC. Copies
of those reports must also be furnished to the Company. Based solely on a
review of the copies of reports furnished to the Company, the Company believes
that during Fiscal 1997 no person who was a Director, officer or greater than
10% beneficial owner of the Company's Common Stock failed to file on a timely
basis all reports required by Section 16(a).
EXPENSES OF SOLICITATION
The Company will pay the entire expense of soliciting proxies for the Annual
Meeting. In addition to solicitations by mail, certain Directors, officers and
regular employees of the Company (who will receive no compensation for their
services other than their regular compensation) may solicit proxies by
telephone, telegram or personal interview. Banks, brokerage houses,
custodians, nominees and other fiduciaries have been requested to forward
proxy materials to the beneficial owners of shares held of record by them and
such custodians will be reimbursed for their expenses. All costs incurred with
respect to the Annual Meeting will be borne by the Company.
SUBMISSION OF STOCKHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Stockholder proposals intended to be presented at the next annual meeting
must be received by the Company on or before September 30, 1998 in order to be
considered for inclusion in the Company's proxy statement and form of proxy
for that meeting. Any such proposal should be mailed to: Secretary, NutraMax
Products, Inc., 9 Blackburn Drive, Gloucester, Massachusetts 01930.
INDEPENDENT ACCOUNTANTS
The firm of Deloitte & Touche LLP served as the Company's independent public
accountants for Fiscal 1997 and will serve in such capacity for the current
fiscal year. A representative of Deloitte & Touche LLP will be present at the
Annual Meeting and will be given the opportunity to make a statement if he or
she so desires. The representative will be available to respond to appropriate
questions.
OTHER MATTERS
The Board of Directors does not know of any matters other than those
described in this Proxy Statement which will be presented for action at the
Annual Meeting. If other matters are duly presented, proxies will be voted in
accordance with the best judgment of the proxy holders.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE
REQUESTED TO COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
13
<PAGE>
PROXY CARD
NUTRAMAX PRODUCTS, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF NUTRAMAX PRODUCTS, INC.
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, FEBRUARY 24, 1998
The undersigned hereby constitutes and appoints Donald E. Lepone, Robert F.
Burns and Eugene M. Schloss, Jr., and each of them, as Proxies of the
undersigned, with full power to appoint his substitute, and authorizes each of
them to represent and to vote all shares of common stock of NutraMax Products,
Inc. (the "Company") held of record by the undersigned as of the close of
business on January 27, 1998, at the Annual Meeting of Stockholders (the
"Annual Meeting") to be held at the Ocean View Inn, 171 Atlantic Road,
Gloucester, Massachusetts 01930 at 10:00 a.m., local time, on Tuesday,
February 24, 1998, and at any adjournments or postponements thereof.
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER(S). IF NO DIRECTION IS GIVEN, THIS PROXY
WILL BE VOTED FOR THE ELECTION OF THE FIVE NOMINEES OF THE BOARD OF DIRECTORS
LISTED IN PROPOSAL NUMBER 1. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED
TO VOTE UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE ANNUAL
MEETING AND ANY ADJOURNMENTS OR POSTPONEMENTS THEREOF. A STOCKHOLDER WISHING
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTOR'S RECOMMENDATIONS NEED ONLY
SIGN AND DATE THIS PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE.
The undersigned hereby acknowledge(s) receipt of a copy of the accompanying
Notice of the Annual Meeting of Stockholders, the Proxy Statement with respect
thereto and the Company's 1997 Annual Report to Stockholders, and hereby
revoke(s) any proxy or proxies heretofore given. This proxy may be revoked at
any time before it is exercised.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE (WHICH REQUIRES NO POSTAGE IF MAILED WITHIN THE UNITED STATES).
PLEASE SIGN YOUR NAME EXACTLY AS SHOWN. WHERE THERE IS MORE THAN ONE HOLDER,
EACH SHOULD SIGN. WHEN SIGNING AS AN ATTORNEY, ADMINISTRATOR, EXECUTOR,
GUARDIAN OR TRUSTEE, PLEASE ADD YOUR TITLE AS SUCH. IF EXECUTED BY A
CORPORATION OR PARTNERSHIP, THE PROXY SHOULD BE SIGNED BY A DULY AUTHORIZED
PERSON, STATING HIS OR HER TITLE OR AUTHORITY.
<PAGE>
PLEASE MARK YOUR
X VOTES AS IN THIS
EXAMPLE.
9288
FOR ALL
FOR WITHHOLD EXCEPT
PROPOSAL 1. Election of five Directors, [_] [_] [_]
for a one year term.
NOMINEES: Donald M. Gleklen,
Bernard J. Korman, Donald E.
Lepone, Dennis M. Newnham
and David M. Schulte
If you do not wish your shares voted FOR a particular nominee, mark the FOR ALL
EXCEPT box and strike a line through that nominee's name. Your shares will be
voted for the remaining nominee(s).
PROPOSAL 2. To consider and act upon such other business as may properly come
before the meeting and any adjournments or postponements thereof.
SIGNATURE(S) ____________________________________________ DATE ___________
PLEASE BE SURE TO SIGN AND DATE THIS PROXY.
HAS YOUR ADDRESS CHANGED?
_______________________________________
_______________________________________
_______________________________________
