<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. 1)
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
NuMED Home Health Care, Inc.
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Committee for a New NuMED
------------------------------------------------------------------------
(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)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
Common Stock, Par Value $0.001 Per Share
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing
fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials:
/ / Check box if any 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:
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(4) Date Filed:
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<PAGE>
COMMITTEE FOR A NEW NUMED
YOUR VOTE CAN CHANGE THE FUTURE
OF YOUR COMPANY
Dear Fellow NuMED Stockholders:
The Committee for a New NuMED is seeking your support to elect its five
nominees to the Board of Directors of NuMED Home Health Care, Inc. We
believe that, in order to reverse the Company's dismal performance under the
control of Jugal K. Taneja, we must elect new directors who are not
associated with the current Board and management.
The election of our nominees will accomplish three important objectives.
First, Mr. Taneja must not continue to hold a seat on the Board of Directors.
The election of our nominees will allow us to once and for all sever Mr.
Taneja's control of the Company. Second, the newly-constituted Board will be
able to select a new Chairman of the Board to lead the turnaround at the
Company. And third, with majority control of the Board, our new directors
(along with existing management) will be able to implement new policies and
programs designed to improve the Company's poor operating record and
financial condition.
A QUESTION OF ACCOUNTABILITY
A fundamental tenet of corporate democracy is management accountability. The
incumbent directors of any public company do not have the automatic right to
continue running the company indefinitely, particularly after a prolonged period
of poor performance. They must answer to you, the true owners of the Company.
That truth is why the law requires a corporation such as NuMED to hold a
stockholders' meeting every year.
Unfortunately, NuMED has not held a stockholders' meeting in over 30 months. It
was only after our persistent call for a meeting, which included commencing a
lawsuit to force a meeting to be held, that the Company finally scheduled a
stockholders' meeting for December 28.
A RARE OPPORTUNITY FOR STOCKHOLDERS
If you don't act now to support our nominees, there may not be a stockholder
group in the future willing to take action to challenge the incumbent directors
if they continue to perform poorly. We can't afford business as usual at NuMED
any longer.
Remember: it was only after we forced the issue that the Board scheduled this
Annual Meeting. It is a rare case when an outside stockholder has the financial
ability, courage and persistence to challenge an incumbent board. This year,
however, through our efforts, you have the opportunity to call NuMED's Board and
management to account for their continued failures.
Exercise your democratic right as an owner of NuMED. Vote to support the
Committee's nominees and help bring a change of direction to the Company.
Please sign and return the BLUE proxy card today. If you need assistance in
voting your shares, please call our proxy solicitor, Beacon Hill Partners, at
1-800-755-5001.
Thank you for your support.
Sincerely,
THE COMMITTEE FOR A NEW NUMED November ____, 1998
<PAGE>
COMMITTEE FOR A NEW NUMED
PRELIMINARY PROXY STATEMENT
IN OPPOSITION TO THE BOARD OF DIRECTORS OF
NUMED HOME HEALTH CARE, INC.
ANNUAL MEETING OF STOCKHOLDERS
Scheduled for December 28, 1998
TO THE STOCKHOLDERS OF NUMED HOME HEALTH CARE, INC.:
This Proxy Statement is furnished by the Committee for a New NuMED in
connection with its solicitation of proxies to be used at the Annual Meeting of
Stockholders of NuMED Home Health Care, Inc. ("NuMED" or the "Company")
scheduled to be held Monday, December 28, 1998 at the offices of Foley &
Lardner, Suite 2700, 100 N. Tampa Street, Tampa, Florida 33601-3391 at 9:00
A.M., local time, and at any adjournments or postponements of the Annual
Meeting.
Initially, we are sending this Proxy Statement and the accompanying BLUE
proxy card to the Company's stockholders on or shortly after November 27, 1998.
The Company has set December 7, 1998 as the record date for determining
stockholders entitled to notice of, and to vote at, the Annual Meeting. We will
also distribute this Proxy Statement to all stockholders who own shares of the
Company's common stock on the record date but who do not receive the initial
mailing of the Proxy Statement.
According to the Company's most recent filing with the Securities and
Exchange Commission, as of November 20, 1998, there were outstanding and
entitled to vote at the Annual Meeting a total of 4,966,620 shares of the
Company's common stock, $0.001 par value per share. Each share is entitled to
one vote on all matters submitted to a vote of the stockholders at the Annual
Meeting. As of the date of this Proxy Statement, members of the Committee have
the right to vote 508,500 shares of NuMED constituting approximately 10.2% of
the total votes eligible to be cast at the Annual Meeting. See THE COMMITTEE.
- -------------------------------------------------------------------------------
IMPORTANT
WE URGE YOU TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED BLUE PROXY CARD TO
VOTE FOR THE ELECTION OF OUR NOMINEES AND FOR THE AMENDMENT TO NUMED'S BY-LAWS
TO ELIMINATE THE CLASSIFIED BOARD OF DIRECTORS. WE HAVE PROVIDED A POSTAGE-
PAID ENVELOPE FOR YOUR CONVENIENCE.
WE URGE YOU NOT TO SIGN ANY PROXY CARD SENT TO YOU BY THE COMPANY. IF YOU
HAVE ALREADY DONE SO, YOU MAY REVOKE THAT PROXY BY SIGNING AND RETURNING THE
ENCLOSED BLUE PROXY CARD TO US. YOU CAN ALSO REVOKE AN EARLIER PROXY BY
WRITTEN REVOCATION SENT TO THE COMPANY OR BY APPEARING AT THE ANNUAL MEETING
AND VOTING IN PERSON.
- -------------------------------------------------------------------------------
<PAGE>
REASONS FOR THIS SOLICITATION
The Committee for a New NuMED (the "Committee") urgently solicits your
proxy to enable us to regain our rights as stockholders and revive our failing
Company. We seek your help to elect five directors with substantial business
experience to the NuMED Board. We believe that our nominees will be more
responsible in their direction of the management of the Company than the current
Board of Directors and that our nominees will implement the policies necessary
to maximize stockholder value.
NUMED'S SHARES CONTINUALLY UNDERPERFORM THE MARKET
From a high of $6.00 in May 1994, NuMED's stock has sunk to less than
44CENTS on November 11, 1998. We believe that this steep per share decline
reflects the market's dim view of the Company's prospects under its current
management. In addition, on November 13, 1998, The Nasdaq Stock Market, Inc.
delisted the Company's shares from the Nasdaq SmallCap Market, where they
previously traded under the symbol "NUMD." Based on information provided by
Nasdaq, the stock was delisted because the Company did not meet the Small Cap
Market's listing requirements regarding minimum net tangible assets and
income, minimum market value of the public float, and minimum bid price for
the shares. We believe that the delisting will further reduce the trading
market, liquidity and price of NuMED's stock.
The following graph compares the cumulative total return on NuMED's
stock with the cumulative total return on the companies in the Standard &
Poor's 500 Index and the Standard & Poor's SmallCap 600 Index assuming an
initial investment of $100 on May 2, 1994 (when NuMED's stock was first
listed for trading on a stock exchange) with dividends reinvested when paid
and share prices as of the last day of each fiscal year and November 12, 1998
(the last day the stock traded on the Nasdaq SmallCap Market).
<TABLE>
<CAPTION>
4/2/94 3/31/95 3/29/96 3/31/97 3/31/98 11/12/98
<S> <C> <C> <C> <C> <C> <C>
NUMD $100 $28.57 $45.24 $23.81 $28.57 $8.93
S&P 500 $100 $113.13 $149.44 $179.07 $265.02 $252.32
S&P SmallCap 600 $100 $102.89 $134.98 $146.31 $216.06 $133.84
</TABLE>
As the graph shows, a $100 investment in NuMED on May 2, 1994, 1998 would be
worth $8.93 on November 12, 1998 -- a decrease of over 90%! The same $100
would be worth $252.32 if
2
<PAGE>
invested in the Standard & Poor's 500 Index or $133.84 if invested in the
Standard & Poor's SmallCap 600 Index.
NUMED'S NET WORTH HAS DECLINED PRECIPITOUSLY
From April 1, 1995 through September 30, 1998, the Company reported net
losses totaling approximately $4.0 million. The Company's net worth has
declined from over $10.0 million on March 31, 1996, to less than $6.0 million
on September 30, 1998, a loss of more than 40% of stockholders' equity in
little more than three years! In its most recent annual report, the Company
stated that its profitability has been negatively impacted by five factors,
the first factor being that "NuMED has incurred excessive legal and other
costs relating primarily from failed acquisitions." We agree that the
Company cannot afford any more failed acquisitions. We believe that stronger
management would help limit speculative acquisitions and excessive expenses.
See SOLUTIONS TO THE PROBLEM.
SECOND QUARTER PROFIT NOT WHAT IT APPEARS TO BE
NuMED reported a net profit of $41,000, or $0.01 per share, for the quarter
ended September 30, 1998. However, this profit only occurred after the Company
recognized $525,000 in other income as a result of a one-time recovery from an
appeal of previously disallowed costs. Without this one-time recovery, the
Company would have continued its history of losses.
SHOW US THE MONEY
Someone is making money from the Company -- unfortunately it isn't the
stockholders. Although NuMED's revenues have almost tripled from $7.6 million
for the fiscal year ended March 31, 1994 to $22.6 million at March 31, 1998,
earnings have plummeted. The following graph illustrates the Company's failure
to capitalize on its increased earnings.
<TABLE>
<CAPTION>
1994 1995 1996 1997 1998
---------- ---------- ------------ ----------- ----------
<S> <C> <C> <C> <C> <C>
Earnings Per Share $0.18 ($0.03) $0.02 ($0.38) ($0.40)
Revenue $7,595,349 $9,357,188 $24,133,516 $24,590,951 $22,649,516
</TABLE>
3
<PAGE>
MR. TANEJA HAS BENEFITED FROM THE COMPANY -- HAVE YOU?
While the Company's stock was declining in value and its fiscal performance
deteriorating, the Company paid Jugal K. Taneja, then Chairman of the Board and
Chief Executive Officer of the Company, a lucrative compensation package (a
total of $722,344 in the last three years) and granted him the right to
purchase 920,000 shares of NuMED stock. Mr. Taneja finally relinquished his
title as Chief Executive Officer and Chairman of the Board on November 23,
1998. We believe it was the public position taken by the Committee that led
to Mr. Taneja's resignation. However, Mr. Taneja remains a director, and
the Company has not disclosed the amount of Mr. Taneja's severance package or
any other details of his agreement with the Company; we don't know how much
more he has benefited from the Company at your expense.
In addition, Mr. Taneja has also benefited, from various agreements the
Company has entered into with (1) A.T. Brod & Co., Inc., a securities
brokerage firm and wholly-owned subsidiary of Bancapital Financial
Corporation, of which Mr. Taneja is a majority stockholder and Chief
Executive Officer, and (2) Bancapital Corporation, which is owned and
controlled by Mr. Taneja. Over the past six years, the Company has disclosed
that it has paid approximately $2.0 million to A.T. Brod and Bancapital
Corporation. The Company has also disclosed that it issued 40,000 shares of
NuMED stock to A.T. Brod, as well as granting it options to purchase an
additional 110,000 shares of NuMED stock. On March 28, 1995, A.T. Brod,
which previously made a market for NuMED's stock, was shut down by the New
York Stock Exchange for violating Securities and Exchange Commission and New
York Stock Exchange rules. The Committee believes that the closure of A.T.
Brod led to a lack of investor support for NuMED stock, which, we believe,
continues to this day to contribute to the steady decline in the value of
NuMED stock.
NUMED'S BOARD HAS FAILED TO RESPOND TO STOCKHOLDER CONCERNS
The Board of Directors of NuMED has shown a lack of concern for the
stockholders of the Company. This lack of concern is evident by their
decision to unilaterally insulate themselves from being held accountable to
stockholders for their mismanagement of the Company. In January 1996, the
Board of Directors amended the Company's By-laws to classify the members of
the Board of Directors into three groups of two or three directors each. The
By-laws provide that they may be amended by the Board of Directors and the
directors did not seek stockholder approval to classify the Board. In a
classified board, which is also called a staggered board, the stockholders
elect each group of directors in alternating years. Classification of NuMED's
Board of Directors will make it more difficult for you to change the
composition of the Board because at least two annual meetings of the
stockholders, instead of one, will be necessary to replace a majority of the
directors. We believe that the classified Board is simply a way for
management to entrench itself and avoid being held accountable for the
serious decline in stockholder value. In its 1996 proxy statement, NuMED
admitted that the classified board "could have the effect of discouraging a
third party from initiating a proxy contest, making a tender offer or
otherwise attempting to obtain control of the Company, even though such a
transaction could be beneficial to the Company and its stockholders." We
believe that responsible directors would not unilaterally institute internal
mechanisms, such as a classified board, to insulate themselves from
stockholder disapproval. We believe that you must have the ability on an
annual basis to voice your disapproval of the poor performance of your Board
4
<PAGE>
of Directors, and to elect new directors if necessary. See PROPOSAL TO AMEND
THE BY-LAWS TO ELIMINATE THE CLASSIFIED BOARD OF DIRECTORS.
In 1997, NuMED's Board of Directors simply failed to hold an annual
meeting, completely denying you the right to vote for directors (with the
result that you will be voting for two classes of directors at the 1998
Annual Meeting). On several occasions, Committee member Richard M. Osborne
expressed to the Board his concerns over the direction of NuMED and requested
that the Company hold a meeting of its stockholders. The Board repeatedly
ignored Mr. Osborne's concerns, which prompted him to file a lawsuit, through
a company Mr. Osborne manages, against NuMED to compel an annual meeting.
Even after the lawsuit was filed, the Board of Directors has delayed holding an
annual meeting of stockholders more than a year, although Nevada law and the
Company's By-laws require the Company to hold a meeting of its stockholders
annually. See BACKGROUND TO THIS SOLICITATION.
A COMPANY IN TURMOIL
NuMED announced two merger agreements in 1998. Both would have led to a
change of control of the Company. Both were abandoned. In addition, five of
NuMED's directors have resigned over the past three years. We do not believe
that this turmoil can continue. We believe it is time for a new NuMED.
We have summarized the events and failures that have led us to conclude
that it is time to replace NuMED's Board of Directors. We describe below the
events leading up to this proxy solicitation which further strengthen our
conviction that the stockholders of NuMED have stood by long enough while the
Board's mismanagement of the Company has caused a steady decline in stockholder
value.
BACKGROUND TO THIS SOLICITATION
Richard M. Osborne, a member of the Committee, has fought to bring you the
opportunity to elect a new Board of Directors that will operate NuMED
profitably. Conversely, management of the Company has acted to keep this
opportunity from you.
On April 8, 1997, Turkey Vulture Fund XIII, Ltd. (the "Fund"), an Ohio
limited liability company of which Mr. Osborne is the Manager, requested,
pursuant to Nevada law, to inspect the Company's stockholders' list. When
the Company failed to respond, the Fund renewed its request to inspect the
stockholders' list on September 25, 1997, and in addition requested that the
Board of Directors of NuMED schedule an annual meeting of stockholders. The
Company has not held an annual meeting since March 29, 1996, and no election
of directors has taken place since then, contrary to the provisions of Nevada
law and the Company's own By-laws. Article III, Section 1 of the Company's
By-laws requires that NuMED hold an annual meeting of stockholders every
year. After the Board once again ignored the Fund's request, the Fund repeated
its demand for a stockholders' meeting on October 8, 1997.
With the hope of trying to convince NuMED's directors to hold a
stockholders' meeting, representatives of the Fund held discussions with
representatives of NuMED throughout the Summer and Fall of 1997. After the
Fund's continued efforts to press NuMED to hold a meeting failed, the
5
<PAGE>
Fund was left with no alternative but to commence a lawsuit to force the
Board of Directors to hold an annual meeting of stockholders. On November
14, 1997, the Fund initiated a lawsuit captioned TURKEY VULTURE FUND XIII,
LTD. V. NUMED HOME HEALTH CARE, INC. (2nd Jud. Dist. Ct., Washoe Cty., Nev.
Case No. CV-97-0777), alleging the facts described above and requesting that
the court (1) issue an order directing NuMED to produce its stockholders'
list for the Fund's inspection, (2) issue an order requiring NuMED to
schedule an annual stockholders' meeting, (3) enjoin NuMED from interfering
with the Fund's statutory rights as a stockholder, (4) award the Fund
compensatory damages for its injuries resulting from NuMED's failure to
comply with Nevada law relating to the inspection of stockholders' records,
(5) order NuMED to pay the Fund's costs, and (6) find any other further
relief as the court deems proper.
In December 1997, the Fund's counsel continued to have discussions with
NuMED's counsel in an attempt to settle the lawsuit. In January and February
1998, representatives of the Company requested that the Fund invest $2.0 million
in NuMED. The Fund's investment was contingent upon terminating Mr. Taneja's
employment agreement. Negotiations for a capital infusion by the Fund broke
down when NuMED requested an additional $4.0 million loan and began discussing
alternate plans with other parties.
In January 1998, the Company and the Fund negotiated a settlement of the
Fund's lawsuit. The terms of the settlement required the Company to provide the
Fund with a recent stockholders' list, and to hold an annual meeting of
stockholders by March 6, 1998. However, terms of the settlement agreement were
never finalized, and on February 18, 1998, NuMED announced that it had entered
into an agreement to merge with Banyan Healthcare Services, Inc., a merchant
banking firm organized to effect the combination of home health care companies.
In light of the Company's pending merger with Banyan, the Fund determined that
it would not pursue the litigation and dismissed the action without prejudice in
early March 1998. Banyan and NuMED subsequently terminated their merger
agreement.
After the failed Banyan merger, periodic conversations took place between
the Fund and the Company regarding holding an annual meeting and whether a
representative of the Fund would become a member of the Board of Directors of
NuMED. On October 14, 1998, the Company announced that a second merger
agreement, this time with Mednu Acquisition Corp., had been terminated. On
October 6, 1998, the Fund again requested that NuMED hold an annual meeting
and renewed its demand for a stockholders' list on October 19, 1998. Finally,
after delaying for 14 months, on November 2, 1998, the Board of Directors of
NuMED announced that the Company would hold an annual meeting of stockholders
on December 28, 1998.
On November 12, 1998, the Committee filed a preliminary copy of this Proxy
Statement with the Securities and Exchange Commission, as required by the
Securities Exchange Act of 1934 (the "Exchange Act"). In response, the Company
filed a lawsuit against the Fund captioned NUMED HOME HEALTH CARE, INC. V.
TURKEY VULTURE FUND XIII, LTD. (U.S. Dist. Ct., Florida, Tampa Division, No.
98-2354-CIV-T-17F). The complaint alleges that the Fund failed to file an
amendment to its Schedule 13D indicating that it "is attempting to gain control
of NuMED through a proxy fight, oust current management, and eliminate NuMED's
staggered Board of Directors" and the Fund failed to file an amendment to its
Schedule 13D regarding the purchase of 23,500 shares of NuMED stock.
6
<PAGE>
The complaint seeks (1) a temporary and permanent injunction requiring the
Fund to file an amendment to its Schedule 13D "which will accurately
reflect its true purpose," (2) a temporary injunction enjoining the Fund from
exercising voting rights and soliciting proxies during the pendency of the
lawsuit and "an appropriate 'cooling-off period,'" (3) costs and attorneys'
fees and (4) such other relief as the court deems just and appropriate. We
can only assume that the Board of Directors of the Company filed the lawsuit
against the Fund in an attempt to delay the outcome of the Annual Meeting and
further entrench itself.
The Fund denies that there has been any violation of Section 13(d) of the
Exchange Act or the related rules and regulations. All the required disclosure
regarding the change in the Board of Directors and the By-laws was made on a
prompt and timely basis when we filed the preliminary version of this Proxy
Statement on November 12, 1998. The Fund will vigorously defend itself against
the allegations in the lawsuit and will seek appropriate sanctions for
litigation that we believe is groundless and a waste of corporate assets. We
will take all steps necessary to insure that the stockholders of NuMED have the
opportunity to vote for directors this year.
On November 23, 1998, NuMED announced that Mr. Taneja has relinquished his
title as Chief Executive Officer of the Company. We are pleased that the
pressure we have placed on the Board has achieved one of our primary goals.
However, the work of the Committee and of the NuMED stockholders is not done.
Mr. Taneja remains a director. The election of our nominees will allow us to
once and for all sever Mr. Taneja's control of the Company.
SOLUTIONS TO THE PROBLEM
We have experience in investing, analyzing and managing companies
profitably. See NOMINEES FOR ELECTION AS DIRECTORS. We are committed to:
- - Naming Richard M. Osborne Chairman of the Board to oversee the turnaround at
NuMED;
- - Working with management to develop a plan to achieve profitability and enhance
stockholder value;
- - Imposing strict controls on overhead expenses and implementing necessary
steps to cut costs; and
- - Implementing a continuous, effective stockholder relations program to keep
stockholders informed about NuMED.
Once elected to the Board of NuMED, we will use the detailed financial and
operational information of the Company available to us as directors to develop
specific plans to implement each of the solutions mentioned above. Our added
knowledge of the Company will also allow us to direct our plans and proposals
into other areas to reach our goals of achieving profitability and enhancing
stockholder value.
7
<PAGE>
OUR PROMISE TO STOCKHOLDERS
We are not attempting to benefit ourselves at the expense of any other
stockholders. Rather, we are seeking to create value for all stockholders.
- - We will NOT terminate NuMED employees simply for the sake of cutting costs;
our grievance is with the Company's directors, who have permitted Mr. Taneja
to remain on the Board. Our grievance is not with the professional staff of
the Company. We trust that with stability, a coherent business plan,
professional management and stockholder oversight, their talents can be put to
profitable use.
- - We will NOT increase the pay and benefits of officers or reward them with
"golden parachutes" at a time when the price of NuMED's stock is less than
50CENTS. We WILL seek to create a total compensation program to attract,
retain and motivate the high caliber executives required for the success of
the Company, including stock options with exercise prices that will provide
management with a direct financial incentive to enhance stockholder value,
aligning the interests of the Company's executives with the long-term
interests of its stockholders.
- - We will NOT be compensated by NuMED, other than (1) compensation, if any,
payable to any of the nominees solely in their capacities as directors of
NuMED, (2) payments received by the Fund and members of the Committee in
their capacity as stockholders of the Company, (3) reimbursement from the
Company of the expenses of the solicitation of proxies or (4) in any
transaction approved by a majority of the stockholders of the Company.
THE COMMITTEE
We have formed the Committee for a New NuMED because of our conviction that
the stockholders of NuMED have stood by long enough while the Board's
mismanagement of the Company has caused a steady decline in stockholder
value. See REASONS FOR THIS SOLICITATION. The members of the Committee are
Richard M. Osborne, J. Michael Gorman, Thomas J. Smith, Gary A. Lyons and
Louise B. Miller, individuals with substantial management experience,
including managing publicly-traded and health-care related companies. See
NOMINEES FOR ELECTION AS DIRECTORS.
As of the date of this Proxy Statement, members of the Committee
beneficially own 508,500 shares of NuMED's common stock, representing
approximately 10.2% of the outstanding stock of the Company. All of these
shares are owned by the Fund, and Mr. Osborne, as the sole Manager of the Fund,
is considered the beneficial owner of all shares owned by the Fund.
Additional information concerning the Committee, the Fund and the Fund's
holdings of NuMED's stock is included in attached Appendix A.
8
<PAGE>
NOMINEES FOR ELECTION AS DIRECTORS
Based on the Company's most recent annual report filed with the Securities
and Exchange Commission, we believe that the NuMED Board currently has seven
director positions. Four of these positions are filled, and the remaining three
are vacant as a result of resignations. The Board of Directors is divided into
three groups of two or three directors serving for three-year terms. Because
there was no annual meeting held in 1997, the terms of the director positions
held by Thomas V. Chema and Judi M. Kelly (who resigned as of March 31, 1998)
have expired, and the terms of Susan J. Carmichael, Jugal K. Taneja and Robert
P. Ottman will expire at the Annual Meeting. Therefore, we believe that the
stockholders are entitled to vote for five directors at the Annual Meeting,
leaving two vacancies.
Under the current terms of the Company's By-laws, directors elected at the
Annual Meeting will each serve for a period of two or three years. However, we
propose to amend the Company's By-laws to eliminate the classified Board of
Directors, permitting the stockholders to elect all directors annually. We
believe that this will insure that the Board of Directors will be accountable to
all stockholders. See REASONS FOR THIS SOLICITATION -- NUMED'S BOARD HAS FAILED
TO RESPOND TO STOCKHOLDER CONCERNS and PROPOSAL TO AMEND THE BY-LAWS TO
ELIMINATE THE CLASSIFIED BOARD OF DIRECTORS.
In opposition to the slate of directors proposed by the incumbent Board of
Directors, the Committee is proposing a slate of five experienced and
well-qualified nominees for election as new directors of the Company who, if
elected, would constitute the entire Board of Directors, unless the existing
two vacancies are filled. The affirmative vote of the holders of a plurality
of the shares cast at the Annual Meeting is required for the election of
directors.
Each nominee named below has agreed to serve as a director of the Company
if elected. We do not expect that any of the nominees will be unable to stand
for election but, if a vacancy in the slate of nominees occurs unexpectedly, the
shares represented by the enclosed BLUE proxy card will be voted for a
substitute candidate selected by the Committee.
The following information concerning business address, age and principal
occupation has been furnished by the Committee's nominees.
9
<PAGE>
<TABLE>
<CAPTION>
NAME AND BUSINESS ADDRESS PRINCIPAL OCCUPATION FOR PAST FIVE YEARS
- --------------------------------- --------------------------------------------
<S> <C>
Richard M. Osborne Mr. Osborne, 53, is President and Chief
7001 Center Street Executive Officer of OsAir, Inc., a company
Mentor, Ohio 44060 he founded in 1963. OsAir is a manufacturer
of industrial gases for pipeline delivery and
a real property developer. Mr. Osborne is the
Manager of Turkey Vulture Fund XIII, Ltd.,
which began operations in January 1995. The
Fund acquires, holds, sells or otherwise
invests in all types of securities and other
instruments. Mr. Osborne is a director of
TIS Mortgage Investment Company, a publicly-
held real estate investment trust, a trustee
and Chairman of the Board of Trustees of
Meridian Point Realty Trust '83, a publicly-
held real estate investment trust, a director
of Central Reserve Life Corporation, a
publicly-held insurance holding company, a
director and Chairman of the Board of Pacific
Gateway Properties, Inc., a publicly-held
real estate company, and a director and
Vice Chairman of the Board of GLB Bancorp,
Inc., a bank holding company.
J. Michael Gorman Mr. Gorman, 46, is the President and Chief
1109 S. Main Street Executive Officer of Harmony Laboratories,
Landis, North Carolina 28088 Inc., which develops and distributes
over-the-counter pharmaceuticals and health
and beauty aids. From 1990 through 1995,
Mr. Gorman was President of Knox
International, Inc., a company that produces
and distributes medical gases and equipment.
Prior to that time, Mr. Gorman served as
President of GPI, Inc., a producer of custom
plastic devices for the medical industry.
Thomas J. Smith Mr. Smith, 54, has been the President of
8500 Station Street Retirement Management Company, which manages
Suite 100 assisted living and retirement facilities,
Mentor, Ohio 44060 since 1992. Since April 1996, Mr. Smith has
served as the Executive Operating Manager of
Liberty Self-Stor, Ltd., which owns and
operates 13 self-storage facilities. Mr.
Osborne controls both Retirement Management
and Liberty Self-Stor. Mr. Smith is also a
director of GLB Bancorp, a bank holding
company, and a trustee of Meridian Point
Realty Trust '83, a publicly-held real estate
investment trust.
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
NAME AND BUSINESS ADDRESS PRINCIPAL OCCUPATION FOR PAST FIVE YEARS
- --------------------------------- --------------------------------------------
<S> <C>
Gary A. Lyons Mr. Lyons, 46, has been the Senior Vice-
8500 Station Street President of Retirement Management Company
Suite 100 since 1992. Mr. Lyons is also employed by
Mentor, Ohio 44060 Liberty Self-Stor as the Acquisition Manager,
responsible for identifying and evaluating
potential acquisitions of self-storage
facilities.
Louise B. Miller Ms. Miller, 36, has been the Assistant
8500 Station Street Controller of Retirement Management since May
Suite 100 1997. Prior to that time, Ms. Miller was the
Mentor, Ohio 44060 President and co-owner of Scot's Manor, Inc.,
a company she founded in 1987. Scot's Manor
operated as an assisted living facility in
Orwell, Ohio.
</TABLE>
PROPOSAL TO AMEND THE BY-LAWS TO
ELIMINATE THE CLASSIFIED BOARD OF DIRECTORS
NuMED's By-laws do not allow for the election of all directors at each
annual meeting of stockholders. Instead, NuMED's directors amended the By-laws
to divide the Board into three classes, with each class serving for a three-year
term. NuMED's classified Board of Directors generally has the effect of
delaying or discouraging any proxy contest, tender offer or other extraordinary
corporate transaction by making it more difficult for stockholders to change the
composition of the Board. See REASONS FOR THIS SOLICITATION -- NUMED'S BOARD
HAS FAILED TO RESPOND TO STOCKHOLDER CONCERNS. We propose to eliminate the
classifications, which could enable a potential buyer to replace the entire
Board at one time, if the buyer owned enough shares or had adequate stockholder
support. Of course, we cannot guarantee that any buyer will emerge.
We believe that it is in the best interest of NuMED's stockholders to
eliminate the classified Board of Directors which would permit stockholders to
elect all directors annually. We believe that this will insure that all
directors will be more accountable to you, the stockholders, every year. If
this proposal is adopted, it will govern the next election of directors. If the
Committee's entire slate of directors is elected at the Annual Meeting and two
vacancies remain on the Board, we will reduce the number of directors to five.
Approval of this amendment to the By-laws requires the affirmative vote of
a majority of the outstanding shares of NuMED common stock. Abstentions and
broker no-votes will have the effect of a "no vote" to our proposal. Therefore,
you should NOT check the abstention box on the proxy card for this proposal
unless you are opposed to it.
The resolution to be considered by the stockholders in connection with this
proposal is attached as Appendix B to this Proxy Statement.
11
<PAGE>
VOTING OF PROXIES
Unless otherwise indicated, the persons named in the accompanying BLUE
proxy card will vote properly executed and duly returned proxies (1) FOR the
election of the five Committee nominees as members of the Board of Directors
of the Company to serve until their successors are elected and qualified, (2)
FOR the proposal to amend NuMED's By-Laws to eliminate the classified Board
of Directors and to provide that all directors be elected annually for
one-year terms, and (3) in accordance with their judgment on any other
business that may be properly presented at the Annual Meeting and any
adjournment or postponement.
Please sign, date and return the BLUE proxy card in the postage-paid
envelope provided. Execution of the enclosed BLUE proxy card will not affect
your right to attend the Annual Meeting and vote in person. You may revoke a
proxy at any time before it is voted either by a later dated proxy or by voting
in person at the Annual Meeting. Attendance at the Annual Meeting will not in
and of itself revoke your proxy. If you are a stockholder of record on December
7, 1998, you will retain your voting rights in connection with the Annual
Meeting even if you sell your shares after that date. Accordingly, it is
important that you vote the shares you hold on December 7, 1998 or grant a proxy
to vote those shares whether or not you own them after the record date.
You cannot select directors from among those proposed by the Company and
the Committee. THEREFORE, IF YOU WISH TO SUPPORT THE COMMITTEE'S NOMINEES, YOUR
LAST DATED PROPERLY EXECUTED PROXY MUST BE A BLUE PROXY CARD.
PROXY SOLICITATION AND EXPENSES
We may solicit proxies by mail, telephone, facsimile and personal
solicitation. Any of the members of the Committee and any regular employee of
Mr. Osborne may be used to solicit proxies, and will not receive additional
compensation. Banks, brokerage houses and other custodians, nominees and
fiduciaries will be requested to forward the soliciting material of the
Committee to their customers for whom they hold shares and the Committee will
reimburse them for their reasonable out-of-pocket expenses.
We have retained Beacon Hill Partners, Inc., 90 Broad Street, New York, New
York, 10004, to assist us in the solicitation of proxies. We have agreed to
pay Beacon Hill a fee of $12,500 and to reimburse it for its reasonable
out-of-pocket expenses. Approximately 25 people will be used by Beacon Hill
in its solicitation efforts.
We anticipate that the Committee's total expenditures relating to the
solicitation will be approximately $100,000, depending in part upon the cost
the Fund is forced to incur to defend itself from the Company's lawsuit. See
REASONS FOR THIS SOLICITATION -- BACKGROUND TO THIS SOLICITATION. Total
expenditures to date have been less than $10,000. The entire expense of
preparing, assembling, printing and mailing this Proxy Statement and related
materials and the cost of soliciting proxies for the nominees proposed by the
Committee will be borne by the Fund or Mr. Osborne in a manner to be determined
by Mr. Osborne. The Fund or Mr. Osborne will seek
12
<PAGE>
reimbursement from the Company for those expenses and does not intend to seek
stockholder approval for such reimbursement at a subsequent meeting unless
stockholder approval is required under Nevada law. Costs represented by
salaries and wages of regular employees of Mr. Osborne will not be included
in the costs of solicitation and we will not seek reimbursement for these
costs.
STOCKHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
In order to be included in the Company proxy statement for the 1999 Annual
Meeting of Stockholders, any stockholder proposal to be presented at the 1999
Annual Meeting must be received in the office of the Secretary of the Company at
its principal executive offices by the date specified in the Company's proxy
statement for this year's Annual Meeting.
OTHER MATTERS
We are not aware of any other matters to be considered at the Annual
Meeting other than the election of directors and consideration of the proposal
to amend NuMED's By-laws to eliminate the classified Board of Directors.
However, if any other matters properly come before the meeting, the persons
named in the enclosed BLUE proxy card will have discretionary authority to vote
all proxies with respect to these matters in accordance with their judgment.
Sincerely,
THE COMMITTEE FOR A NEW NUMED November , 1998
13
<PAGE>
APPENDIX A
On the date of this Proxy Statement, Richard M. Osborne, as the sole
Manager of the Fund, is the beneficial owner of 508,500 shares of NuMED common
stock, representing approximately 10.2% of the 4,966,620 shares outstanding
according to the most recently available filing by the Company with the
Securities and Exchange Commission. No other Committee nominee is a member
of the Fund.
Under the terms of the Fund's Operating Agreement, Mr. Osborne, as the sole
Manager, manages all day-to-day operations involving, and makes all decisions
concerning, the business and affairs of the Fund. Other than Mr. Osborne, the
members have no authority or power to bind the Fund, vote securities owned by
the Fund, make investment decisions for the Fund or dispose of any securities
held by the Fund. Each member has agreed, under the terms of the Operating
Agreement, to indemnify the Fund for any costs or damages incurred by the Fund
as a result of the exercise of any unauthorized authority by each such member.
Under Rule 13d-3 promulgated by the Securities and Exchange Commission, "a
beneficial owner of a security includes any person, who, directly or indirectly,
through any contract, arrangement, understanding, relationship, or otherwise has
or shares:
(1) Voting power which includes the power, to vote, or to direct the voting of,
such security, and/or
(2) Investment power which includes the power to dispose, or to direct the
disposition of, such security."
Because the members of the Fund, other than Mr. Osborne, lack any of the
requisite powers of beneficial ownership, they are not beneficial owners of the
shares owned by the Fund solely because of their investment as members in the
Fund.
The NuMED stock owned by the Fund was acquired for an aggregate purchase
price of approximately $594,575, primarily with working capital of the Fund.
The following table lists all shares of NuMED stock purchased by the Fund
within the past two years, the dates on which the purchases were made and the
amount of the purchases. Neither the Fund nor Mr. Osborne sold any NuMED stock
during the two-year period.
<TABLE>
<CAPTION>
NUMBER OF SHARES DATE
---------------- ---------------
<S> <C>
9,000 11/13/96
10,000 11/15/96
40,000 11/18/96
10,000 11/21/96
A-1
<PAGE>
<CAPTION>
NUMBER OF SHARES DATE
---------------- ---------------
<S> <C>
31,000 11/25/96
30,000 11/27/96
25,000 12/04/96
10,000 12/05/96
30,000 12/06/96
45,000 12/09/96
15,000 12/12/96
25,000 12/13/96
15,000 12/16/96
15,000 12/17/96
30,000 12/18/96
50,000 01/22/97
34,500 03/11/97
10,500 03/12/97
5,000 03/31/97
45,000 04/01/97
13,500 10/14/97
10,000 10/31/97
</TABLE>
None of J. Michael Gorman, Gary A. Lyons, Louise B. Miller or Thomas J.
Smith has purchased or sold any shares of NuMED during the preceding two years.
Except as otherwise disclosed in this Appendix A, neither the Committee nor
any of its nominees nor any "associate" of any of them or any other person who
may be deemed a "participant" in this proxy solicitation is the beneficial or
record owner of any NuMED stock. Except as otherwise disclosed in this Appendix
A, neither the Committee nor any of its nominees nor any "associate" of any of
them or any other person who may be deemed a "participant" in this proxy
solicitation has purchased or sold any shares of the Company within the past two
years, borrowed any funds for the purpose of acquiring or holding any NuMED
stock or is or was within the past year a party to any contract or arrangement
or understanding with any person with respect to any NuMED stock. There has not
been any transaction since the beginning of the Company's last fiscal year, and
there is not currently any proposed transaction to which the Company is a party,
in which the Fund or any "associate" of the Committee or any of its nominees or
immediate family member of any of them or any other person who may be deemed a
"participant" in the proxy solicitation had or will have a direct material
interest.
A-2
<PAGE>
APPENDIX B
RESOLVED, that the By-laws of NuMED Home Health Care, Inc. (the "Company")
be amended as follows:
Article IV, Section 2 of the By-laws of the Company, which provides for a
classified Board of Directors, shall be deleted in its entirety and the
following provision shall be substituted in its place:
The number of directors who constitute the whole Board of Directors may be
fixed from time to time by resolution of the Board of Directors at a number
not less than three nor more than nine, but the number of directors may only
be reduced to the extent of vacant director positions. Each director shall be
elected for a term of one year and until his or her successor is elected and
qualified. Notwithstanding anything to the contrary contained in the
Company's By-laws, the foregoing provision cannot be deleted or modified in
any respect, except by a majority of the votes cast at a duly called meeting
of the stockholders of the Company at which a quorum is present.
B-1
<PAGE>
IMPORTANT
Your vote is important. No matter how many or how few NuMED shares you own,
please vote FOR the Committee's nominees by signing, dating and mailing the
enclosed BLUE proxy card today. We urge you NOT to return any proxy cards sent
to you by the Board of Directors of the Company.
If you have already returned a Board of Directors' proxy card before receiving
this Proxy Statement, you have every right to change your vote by signing and
returning the enclosed BLUE proxy card. Only your latest dated properly executed
proxy will count at the Annual Meeting.
If you own your NuMED stock in the name of a brokerage firm, your broker cannot
vote your shares unless he or she receives your specific instructions. Please
sign, date and return the enclosed BLUE proxy card in the postage-paid envelope
that has been provided.
If you have any questions about how to vote your NuMED stock, please call our
proxy solicitor:
BEACON HILL PARTNERS
90 BROAD STREET
NEW YORK, NEW YORK 10004
TELEPHONE: 1-800-755-5001
<PAGE>
PROXY
NUMED HOME HEALTH CARE, INC.
ANNUAL MEETING OF STOCKHOLDERS
SOLICITED ON BEHALF PROXY SOLICITED IN
OF THE COMMITTEE FOR OPPOSITION TO THE
A NEW NUMED BOARD OF DIRECTORS
Unless otherwise specified, this proxy will be voted FOR Item 1 (election of
directors) and Item 2 (amendment to the By-laws of NuMED). This proxy will be
voted in the discretion of the proxies on such other matters as may properly
come before the meeting or any adjournment(s) or postponement(s) thereof.
1. Election of five new members of the Board of Directors.
The Committee for a New NuMED nominees are: Richard M. Osborne, J. Michael
Gorman, Thomas J. Smith, Louise B. Miller and Gary A. Lyons.
/ / FOR / / WITHHOLD
(Authority to vote for any nominee(s) may be withheld by lining through or
otherwise striking out the name of such nominee(s).)
2. Approval of the proposal to amend the By-laws of NuMED to eliminate the
classified board of directors and to provide that all directors be elected
annually for one year terms.
/ / FOR / / AGAINST / / ABSTAIN
This Proxy revokes all prior proxies and voting instructions.
THE COMMITTEE FOR A NEW NUMED RECOMMENDS A VOTE FOR ITEMS 1 AND 2.
(CONTINUED AND TO BE SIGNED AND DATED ON THE REVERSE SIDE)
<PAGE>
The undersigned hereby appoints Richard M. Osborne, J. Michael Gorman and
Thomas J. Smith, or any one of them acting singly, with full power of
substitution, as proxies for the undersigned, to represent and vote, as
designated above, all common stock, $0.001 par value per share, of NuMED Home
Health Care, Inc. to which the undersigned is entitled to vote at the Annual
Meeting of the Stockholders of NuMED scheduled to be held on December 28, 1998,
and at any adjournment(s) or postponement(s) thereof, and revokes all prior
proxies with respect to the matters covered by this Proxy.
Date: ______________________, 1998
Signature: _______________________
Signature: _______________________
Title or Authority: ______________
(Please sign exactly as name
appears, indicating title or
representation capacity, where
applicable)
PLEASE SIGN, DATE AND MAIL YOUR PROXY TODAY
If you have any questions on voting, please call:
Beacon Hill Partners at 1-800-755-5001
