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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[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 sec.240.14a-11(c) or sec.240.14a-12
PMR CORPORATION
- --------------------------------------------------------------------------------
(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 (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 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:
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PRELIMINARY PROXY MATERIALS
PMR CORPORATION
501 Washington Street, 5th Floor
San Diego, California 92103
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 5, 1998
TO THE STOCKHOLDERS OF PMR CORPORATION:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of PMR
CORPORATION, a Delaware corporation (the "Company"), will be held on Thursday,
March 5, 1998 at 10:00 a.m. local time at 501 Washington Street, 5th Floor, San
Diego, California 92103 for the following purpose:
1. To approve an amendment to the Company's Certificate of Incorporation to
increase the authorized number of shares of Common Stock from 10,000,000 to
19,000,000 shares and to clarify certain provisions thereof.
2. To transact such other business as may properly come before the meeting or
any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
The Board of Directors has fixed the close of business on January 8, 1998
as the record date for the determination of stockholders entitled to notice of
and to vote at this Special Meeting and at any adjournment or postponement
thereof.
By Order of the Board of Directors
-----------------------------------
Allen Tepper, Chairman of the Board
and Chief Executive Officer
San Diego, California
January 27, 1998
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO ENSURE YOUR
REPRESENTATION AT THE MEETING. A RETURN ENVELOPE (WHICH IS POSTAGE PREPAID IF
MAILED IN THE UNITED STATES) IS ENCLOSED FOR THAT PURPOSE. EVEN IF YOU HAVE
GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING. PLEASE
NOTE, HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD BY A BROKER, BANK OR OTHER
NOMINEE AND YOU WISH TO VOTE AT THE MEETING, YOU MUST OBTAIN FROM THE RECORD
HOLDER A PROXY ISSUED IN YOUR NAME.
2.
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PMR CORPORATION
501 Washington Street, 5th Floor
San Diego, California 92103
PROXY STATEMENT
FOR SPECIAL MEETING OF STOCKHOLDERS
MARCH 5, 1998
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of PMR
Corporation, a Delaware corporation (the "Company"), for use at the Special
Meeting of Stockholders to be held on March 5, 1998, at 10:00 a.m. local time
(the "Special Meeting"), or at any adjournment or postponement thereof, for the
purposes set forth herein and in the accompanying Notice of Special Meeting. The
Special Meeting will be held at the Company's offices at 501 Washington Street,
5th Floor, San Diego, California 92103. The Company intends to mail this proxy
statement and accompanying proxy card on or about January 27, 1998 to all
stockholders entitled to vote at the Special Meeting.
SOLICITATION
The Company will bear the entire cost of solicitation of proxies, including
preparation, assembly, printing and mailing of this proxy statement, the proxy
and any additional information furnished to stockholders. Copies of solicitation
materials will be furnished to banks, brokerage houses, fiduciaries and
custodians holding in their names shares of Common Stock beneficially owned by
others to forward to such beneficial owners. The Company may reimburse persons
representing beneficial owners of Common Stock for their costs of forwarding
solicitation materials to such beneficial owners. Original solicitation of
proxies by mail may be supplemented by telephone, telegram or personal
solicitation by directors, officers or other regular employees of the Company.
No additional compensation will be paid to directors, officers or other regular
employees for such services.
VOTING RIGHTS AND OUTSTANDING SHARES
Only holders of record of Common Stock at the close of business on January
8, 1998 will be entitled to notice of and to vote at the Special Meeting. At the
close of business on January 8, 1998 the Company had outstanding and entitled to
vote 6,925,819 shares of Common Stock. Each holder of record of Common Stock on
such date will be entitled to one vote for each share held on all matters to be
voted upon at the Special Meeting.
All votes will be tabulated by the inspector of election appointed for the
meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes.
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Abstentions and broker non-votes will be counted towards the tabulation of votes
cast on proposals presented to the stockholders and will have the same effect as
negative votes.
REVOCABILITY OF PROXIES
Any person giving a proxy pursuant to this solicitation has the power to
revoke it at any time before it is voted. It may be revoked by filing with the
Secretary of the Company at the Company's principal executive office, 501
Washington Street, 5th Floor, San Diego, California 92103, a written notice of
revocation or a duly executed proxy bearing a later date, or it may be revoked
by attending the meeting and voting in person. Attendance at the meeting will
not, by itself, revoke a proxy.
SHAREHOLDER PROPOSALS
Proposals of stockholders that are intended to be presented at the
Company's 1998 Annual Meeting of Stockholders must be received by the Company
not later than May 13, 1998 in order to be included in the proxy statement and
proxy relating to that Annual Meeting. Stockholders are also advised to review
the Company's Bylaws, which contain additional requirements with respect to
director nominations.
PROPOSAL 1
APPROVAL OF AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION
The Board of Directors has adopted, subject to stockholder approval, an
Amended and Restated Certificate of Incorporation (the "Amendment") to amend and
replace the Company's Restated Certificate of Incorporation (the "Restated
Certificate"). The Amendment is proposed to (i) increase the Company's
authorized number of shares of Common Stock and (ii) to clarify certain
provisions of the Restated Certificate relating to the Board of Directors'
authority to issue preferred stock, the limitation of directors' personal
liability under the Delaware General Corporation Law (the "DGCL") and
indemnification of officers, directors, employees and agents of the Company. The
proposed form of Amendment is attached hereto as Appendix A. Please review
carefully Appendix A in conjunction with this proxy statement.
A. INCREASE OF AUTHORIZED SHARES OF COMMON STOCK FROM 10,000,000 TO
19,000,000.
The Restated Certificate currently authorizes the Company to issue
10,000,000 shares of Common Stock and 1,000,000 shares of Preferred Stock. As of
January 8, 1998, the Company had 6,925,819 shares of issued and outstanding
Common Stock, 1,518,255 shares of Common Stock reserved for issuance upon
exercise of various outstanding stock options (including options issued or
issuable under the Company's stock option plans) and 138,000 shares of Common
Stock reserved for issuance upon exercise of various outstanding warrants. The
Board of Directors believes that the Company's authorized shares of Common Stock
should be increased and the Board has approved the Amendment to increase the
number of authorized
4.
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shares of Common Stock to 19,000,000. The Amendment will make no change in the
authorized number of shares of Preferred Stock.
The additional Common Stock to be authorized by adoption of the Amendment
would have rights identical to the currently outstanding Common Stock of the
Company. Adoption of the Amendment and issuance of the Common Stock would not
affect the rights of the holders of currently outstanding Common Stock of the
Company, except for effects incidental to increasing the number of shares of the
Company's Common Stock outstanding, such as dilution of the earnings per share
and voting rights of current holders of Common Stock. If the Amendment is
adopted, it will become effective upon filing of the Amendment with the
Secretary of State of the State of Delaware.
The Board of Directors desires to have additional shares available to
provide additional flexibility to use its capital stock for business and
financial purposes in the future. The additional shares may be used, without
further stockholder approval, for various purposes including, without
limitation, raising capital, providing equity incentives to employees, officers
or directors, establishing strategic relationships with other companies and
expanding the company's business or service offerings through the acquisition of
other businesses.
The additional shares of Common Stock that would become available for
issuance if the proposal were adopted could also be used by the Company to
oppose a hostile takeover attempt or delay or prevent changes in control or
management of the Company. For example, without further stockholder approval,
the Board could strategically sell shares of Common Stock in a private
transaction to purchasers who would oppose a takeover or favor the current
Board. Although this proposal to increase the authorized Common Stock has been
prompted by business and financial considerations and not by the threat of any
hostile takeover attempt (nor is the Board currently aware of any such attempts
directed at the Company), nevertheless, stockholders should be aware that
approval of the proposal could facilitate future efforts by the Company to deter
or prevent changes in control of the Company, including transactions in which
the stockholders might otherwise receive a premium for their shares over then
current market prices.
Under the Company's Restated Certificate, no stockholder is entitled to
preemptive rights in respect of any future issuances of capital stock. In
addition, the Company does not presently contemplate seeking stockholder
approval for any future issuances of capital stock unless required to do so by
an obligation imposed by applicable law, a regulatory authority or a third
party.
B. CLARIFICATION OF CERTAIN PROVISIONS OF THE RESTATED CERTIFICATE.
If adopted, the Amendment would also modify the Restated Certificate to
clarify certain provisions therein relating to the issuance of Preferred Stock,
the limitation of directors' personal liability and indemnification of agents.
The nature of the clarifying provisions are described below and should be read
in conjunction with Appendix A. The Board of Directors does not view any of the
clarifying amendments as having a substantial effect on the interests of
stockholders. Rather, the Board has proposed the clarifying amendments in order
to better reflect the original intent of those provisions in the Restated
Certificate.
5.
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Article V of the Restated Certificate currently provides that the
Company is authorized to issue up to 1,000,000 shares of Preferred Stock,
including up to 200,000 shares of Series A Convertible Preferred Stock. There
are currently no issued and outstanding shares of Preferred Stock. In addition,
the Restated Certificate currently provides that the Board of Directors may fix
the rights, powers, preferences, qualifications, limitations or restrictions of
Preferred Stock. The Amendment would eliminate the specific reference to Series
A Convertible Preferred Stock and would clarify that up to 1,000,000 shares of
Preferred Stock may be issued by the Company in one or more series, with the
rights, powers, preferences, qualifications, limitations or restrictions as
determined by the Board, and in amounts within a series as determined by the
Board.
Article VII of the Restated Certificate currently provides for the
limitation of the directors' personal liability under the DGCL. The Amendment
would clarify the scope of such limitation to provide that the personal
liability of directors shall be further eliminated or limited consistent with
any subsequent changes in the DGCL.
Article VIII of the Restated Certificate currently provides that the
Company may indemnify persons to the fullest extent permitted by the DGCL. The
Amendment would clarify the indemnification provisions to more fully describe
the class of persons who may receive indemnification under the DGCL and the
nature of expenses and other amounts that may be indemnified thereunder.
The affirmative vote of the holders of a majority of the shares of the
Common Stock, will be required to approve this amendment to the Company's
Restated Certificate of Incorporation. As a result, abstentions and broker
non-votes will have the same effect as negative votes.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 1.
6.
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SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the ownership
of the Company's Common Stock as of December 31, 1997, by: (i) each director;
(ii) each of the executive officers employed by the Company in that capacity on
December 31, 1997; (iii) all executive officers and directors of the Company as
a group; and (iv) all those known by the Company to be beneficial owners of more
than five percent of its Common Stock. Except as otherwise indicated, the
address of each holder identified below is in care of the Company, 501
Washington Street, 5th Floor, San Diego, California 92103.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP (1)
--------------------------------
NUMBER OF
BENEFICIAL OWNER SHARES(1) PERCENT OF TOTAL
- ------------------------------------------------------------------------- --------- ----------------
<S> <C> <C>
Persons and entities affiliated with Proactive
Investment Managers, L.P. (2)....................................... 1,307,458 18.6%
50 Osgood Place, Penthouse
San Francisco, CA 94133
Jon D. Gruber (2)........................................................ 1,192,283 17.1%
50 Osgood Place, Penthouse
San Francisco, CA 94133
J. Patterson McBaine (2)................................................. 1,168,083 16.7%
50 Osgood Place, Penthouse
San Francisco, CA 94133
Charles C. McGettigan (2)................................................ 701,836 10.0%
50 Osgood Place, Penthouse
San Francisco, CA 94133
Myron A. Wick III (2).................................................... 630,011 9.0%
50 Osgood Place, Penthouse
San Francisco, CA 94133
Allen Tepper (3)......................................................... 1,013,281 14.4%
Mark P. Clein (4)........................................................ 223,000 3.1%
Susan D. Erskine (5)..................................................... 141,919 2.0%
Fred D. Furman (6)....................................................... 105,937 1.5%
Daniel L. Frank (7)...................................................... 66,000 *
Richard A. Niglio (9).................................................... 66,000 *
Eugene D. Hill, III (8).................................................. 14,000 *
Charles E. Galetto....................................................... 0 --
All executive officers and directors as a group
(9 persons) (10).................................................... 2,331,973 30.3%
</TABLE>
- ------------------
* Less than one percent.
7.
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(1) Applicable percentages of ownership are based on 6,925,819 shares of Common
Stock outstanding on December 31, 1997, adjusted as required by rules
promulgated by the Securities and Exchange Commission (the "SEC"). This
table is based upon information supplied by officers, directors and
principal stockholders and Schedules 13D and 13G (if any) filed with the
SEC. Unless otherwise indicated in the footnotes to this table and subject
to community property laws where applicable, the Company believes that each
of the stockholders named in this table has sole voting and investment
power with respect to the shares indicated as beneficially owned. Any
security that any person named above has the right to acquire within 60
days is deemed to be outstanding for purposes of calculating the percentage
ownership of such person, but is not deemed to be outstanding for purposes
of calculating the ownership percentage of any other person.
(2) Charles C. McGettigan, a director of the Company since 1992, Myron A. Wick
III, J. Patterson McBaine and Jon D. Gruber are general partners of
Proactive Investment Managers, L.P. Proactive Investment Managers, L.P. is
the General Partner of Proactive Partners, L.P. and Fremont Proactive
Partners, L.P. Shares beneficially owned include (i) 26,500 shares held by
Proactive Investment Managers, L.P. (which include 26,500 shares issuable
pursuant to a warrant exercisable within 60 days of December 31, 1997),
(ii) 561,470 shares held by Proactive Partners, L.P. (which include 26,500
shares issuable pursuant to a warrant exercisable within 60 days of
December 31, 1997), (iii) 42,041 shares held by Fremont Proactive Partners,
L.P., (iv) 71,825 shares held by Mr. McGettigan (which include 64,500
shares issuable pursuant to options exercisable within 60 days of December
31, 1997), (v) 497,547 shares held by entities controlled by Messrs. Gruber
and McBaine (which include (A) 423,247 shares held by Lagunitas Partners
L.P., a limited partnership of which an entity controlled by Messrs. Gruber
and McBaine is the controlling general partner, (B) 21,000 shares held by
Gruber & McBaine International, a corporation, and over which Messrs.
Gruber and McBaine have voting and investment power and (C) 53,300 shares
held in various accounts managed by an investment advisor controlled by
Messrs. Gruber and McBaine), (vi) 40,525 shares held by Mr. McBaine (which
include 1,500 shares over which Mr. McBaine has shared ownership with his
wife, 1,000 shares held by Mr. McBaine's minor child who lives with Mr.
McBaine and 2,000 shares held by Mr. McBaine's child, over which shares Mr.
McBaine has voting and investment power), (vii) 64,725 shares held by Mr.
Gruber (which include 46,600 shares over which Mr. Gruber shares ownership
with his wife, 3,200 shares over which Mr. Gruber has sole voting and
investment power as a trustee for a foundation, 4,000 shares over which Mr.
Gruber has sole voting and investment power as a trustee of accounts for
the benefit of his children and 500 shares held by his wife) and (viii)
2,825 shares held by Mr. Wick. Proactive Investment Managers, L.P. and
Messrs. McGettigan, Wick, McBaine and Gruber, as general partners of
Proactive Investment Managers, L.P., share voting and investment power of
the shares and may be deemed to be beneficial owners of the shares held by
Proactive Partners, L.P. and Fremont Proactive Partners, L.P. Messrs.
McGettigan, Wick, McBaine and Gruber disclaim beneficial ownership of any
shares held by Proactive Investment Managers, L.P., Proactive Partners,
L.P., Fremont Proactive Partners, L.P. or other entities they control or
for which they exercise voting and investment power as described above,
8.
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except to the extent of their respective interests in such shares arising
from their pecuniary interest in such partnerships.
(3) Includes 9,076 shares held by Mr. Tepper, 875,033 shares held by Mr.
Tepper, as Trustee FBO Tepper Family Trust (the "Family Trust"), 15,000
shares held by Mr. Tepper and Ms. Tepper as Trustees FBO The Tepper 1996
Charitable Remainder Trust UA DTD 11/19/96 (the "Charitable Remainder
Trust"), and 114,172 shares issuable pursuant to options exercisable within
60 days of December 31, 1997.
(4) Includes 200,000 shares issuable pursuant to options exercisable within 60
days of December 31, 1997.
(5) Includes 87,566 shares issuable pursuant to options exercisable within 60
days of December 31, 1997 and 7,000 shares held by Ms. Erskine's spouse,
William N. Erskine, who has sole voting and dispositive power over such
shares and as to which Ms. Erskine disclaims beneficial ownership.
(6) Includes 70,000 shares issuable pursuant to an outstanding warrant and
35,937 shares issuable pursuant to options exercisable within 60 days of
December 31, 1997.
(7) Includes 64,500 shares issuable pursuant to options exercisable within 60
days of December 31, 1997.
(8) Includes 14,000 shares issuable pursuant to options exercisable within 60
days of December 31, 1997.
(9) Includes 64,500 shares issuable pursuant to options exercisable within 60
days of December 31, 1997.
(10) Includes 768,175 shares of Common Stock issuable pursuant to exercise of
outstanding options and warrants within 60 days of December 31, 1997, as
described in the notes above, as applicable.
OTHER MATTERS
The Board of Directors knows of no other matters that will be presented for
consideration at the Special Meeting. If any other matters are properly brought
before the meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in accordance with their best judgment.
By Order of the Board of Directors
-----------------------------------
Allen Tepper, Chairman of the Board
and Chief Executive Officer
January 27, 1998
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APPENDIX A
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
PMR CORPORATION
PMR CORPORATION, a corporation organized and existing under the laws of the
state of Delaware, hereby certifies as follows:
1. The name of the corporation is PMR Corporation (the "Corporation").
2. The date of the filing of the Corporation's original Certificate of
Incorporation with the Secretary of State of Delaware was January 8, 1988 under
the name Zaron Capital, Inc.
3. The Certificate of Incorporation of this Corporation is hereby
amended and restated to read as follows:
ARTICLE I.
The name of this Corporation is PMR CORPORATION.
ARTICLE II.
The address, including street, number, city, and county, of the registered
office of the Corporation in the State of Delaware is 1209 Orange Street,
Wilmington, New Castle County, Delaware 19801.
ARTICLE III.
The name of the registered agent in Delaware at such address is The
Corporation Trust Company.
ARTICLE IV.
The purposes of the Corporation are to engage in any lawful act or activity
for which corporations may be organized under the Delaware General Corporation
Law.
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ARTICLE V.
A. This Corporation is authorized to issue two classes of stock to be
designated, respectively, "Common Stock" and "Preferred Stock." The total number
of shares of stock which the Corporation is authorized to issue is twenty
million (20,000,000) shares, of which nineteen million (19,000,000) shares shall
be Common Stock, each having a par value of one cent ($.01) per share and one
million (1,000,000) shares shall be Preferred Stock, each having a par value of
one cent ($.01) per share.
B. The Preferred Stock may be issued from time to time in one or more
series. The Board of Directors is hereby authorized, by filing a certificate (a
"Preferred Stock Designation") pursuant to the Delaware General Corporation Law,
to fix or alter from time to time the designation, powers, preferences and
rights of the shares of each such series and the qualifications, limitations or
restrictions of any wholly unissued series of Preferred Stock, and to establish
from time to time the number of shares constituting any such series or any of
them; and to increase or decrease the number of shares of any series subsequent
to the issuance of shares of that series, but not below the number of shares of
such series then outstanding. In case the number of shares of any series shall
be decreased in accordance with the foregoing sentence, the shares constituting
such decrease shall resume the status that they had prior to the adoption of the
resolution originally fixing the number of shares of such series.
ARTICLE VI.
All of the powers of this Corporation, insofar as the same may be lawfully
vested by this Certificate of Incorporation in the Board of Directors are hereby
conferred upon the Board of Directors of this Corporation. In furtherance and
not in limitation of that power, the Board of Directors shall have the power to
make, adopt, alter, amend and repeal from time to time Bylaws of this
Corporation, subject to the right of stockholders entitled to vote with respect
thereto to adopt, alter, amend and repeal Bylaws by the Board of Directors;
provided, however, that Bylaws shall not be adopted, altered, amended or
repealed by the stockholders of the Corporation except by the affirmative vote
of the holders of two-thirds of the combined voting power of the then
outstanding shares of stock entitled to vote on any proposed amendment to the
Bylaws.
ARTICLE VII.
A. No director shall be personally liable to the Corporation or its
stockholders for monetary damages for any breach of fiduciary duty by such
director as a director, except (i) for breach of the director's duty of loyalty
to the Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) pursuant to Section 174 of the Delaware
2.
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General Corporation Law, or (iv) for any transaction from which the director
derived an improper personal benefit. If the Delaware General Corporation Law is
amended after approval by the stockholders of this Article VII to authorize
corporate action further eliminating or limiting the personal liability of
directors, then the liability of a director shall be eliminated or limited to
the fullest extend permitted by Delaware General Corporation Law, as so amended.
B. Any repeal or modification of this Article VII shall be prospective and
shall not affect the rights under this Article VII in effect at the time of the
alleged occurrence of any act or omission to act giving rise to liability or
indemnification.
ARTICLE VIII.
The Corporation may indemnify any person who is or was a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that the person is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against any and all expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement or
incurred in connection with the investigation, preparation to defend or defense
of such action, suit, proceeding or claim, to the fullest extent permitted by
the Delaware General Corporation Law, as amended from time to time. The
Corporation may purchase and maintain insurance, at its expense, to protect
itself and any director, officer, employee or agent of the Corporation or
another corporation, partnership, joint venture, trust or other enterprise,
against any such expense, liability or loss, to the fullest extent permitted by
the Delaware General Corporation Law.
ARTICLE IX.
Amendments to the Certificate of Incorporation of the Corporation shall
require the affirmative vote of the holders of two-thirds of the combined voting
power of the then outstanding shares of stock entitled to vote on any proposed
amendment to the Certificate of Incorporation. Notwithstanding the foregoing, in
the event that a resolution to amend the Certificate of Incorporation of the
Corporation is adopted by the affirmative vote of at least eighty percent (80%)
of the Board of Directors, approval of the amendment shall only require the
affirmative vote of the holders of a majority of the combined voting power of
the then outstanding shares of stock entitled to vote generally on such
amendment, voting together as a single class.
3.
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ARTICLE X.
A. Except as otherwise fixed by or pursuant to provisions hereof relating
to the rights of the holders of any class or series of stock having a preference
over common stock as to dividends or upon liquidation to elect additional
Directors under specified circumstances, the number of Directors of the
Corporation shall be fixed from time to time by affirmative vote of a majority
of the Directors then in office. The Directors, other than those who may be
elected by the holders of any classes or series of stock having a preference
over the common stock as to dividends or upon liquidation, shall be classified,
with respect to the time for which they severally hold office, into three
classes, as nearly equal in number as possible, as shall be provided in the
manner specified in the Bylaws of the Corporation, one class to be originally
elected for a term expiring at the annual meeting of stockholders to be held in
1997, another class to be originally elected for a term expiring at the annual
meeting of stockholders to be held in 1998, and another class to be originally
elected for a term expiring at the annual meeting of stockholders to be held in
1999, with each class to hold office until its successor is elected and
qualified. At each annual meeting of the stockholders of the Corporation after
1996, the successors of the class of Directors whose term expires at that
meeting shall be elected to hold office for a term expiring at the annual
meeting of stockholders held in the third year following the year of their
election. Election of directors need not be by written ballot unless so provided
in the Bylaws of the Corporation.
B. Except as otherwise fixed by or pursuant to provisions hereof relating
to the rights of the holders of any class or series of stock having a preference
over common stock as to dividends or upon liquidation to elect additional
Directors under specified circumstances, newly created directorships resulting
from any increase in the number of directors and any vacancies on the Board of
Directors resulting from death, resignation, disqualification, removal or other
cause shall be filled by the affirmative vote of a majority of the remaining
Directors then in office, even though less than a quorum of the Board of
Directors. Any Director elected in accordance with the preceding sentence shall
hold office for the remainder of the full term of the class of Directors in
which the new directorship was created or the vacancy occurred and until such
Director's successor shall have been elected and qualified. No decrease in the
number of Directors constituting the Board of Directors shall shorten the term
of any incumbent director.
C. Except as otherwise fixed by or pursuant to provisions hereof relating
to the rights of the holders of any class or series of stock having a preference
over common stock as to dividends or upon liquidation to elect additional
Directors under specified circumstances, any Director may be removed from office
only for cause and only by the affirmative vote of the holders of two-thirds of
the combined voting power of the then outstanding shares of stock entitled to
vote generally in the election of Directors, voting together as a single class.
4.
<PAGE> 14
D. Notwithstanding anything contained in this Certificate of Incorporation
to the contrary, the consent of the Board of Directors shall be required to
alter, amend, or adopt any provisions inconsistent with or repeal this Article
X.
* * *
4. This Amended and Restated Certificate of Incorporation has been
duly adopted by the Board of Directors of this Corporation.
5. This Amended and Restated Certificate of Incorporation has been
duly adopted in accordance with the provisions of Sections 228, 242 and 245 of
the Delaware General Corporation Law by the board of directors and the
stockholders of the Corporation. The total number of outstanding shares entitled
to vote or act by written consent was 6,925,819 shares of Common Stock. A
majority of the outstanding shares of Common Stock approved this Amended and
Restated Certificate of Incorporation by written consent in accordance with
Section 228 of the Delaware General Corporation Law and written notice of such
was given by the Corporation in accordance with said Section 228.
5.
<PAGE> 15
IN WITNESS WHEREOF, said PMR Corporation has caused this Certificate to be
signed by its Chief Executive Officer, Allen Tepper, and attested to by its
Secretary, Susan D. Erskine, this ___day of __________, 1998.
-----------------------------------
Allen Tepper
Chief Executive Officer
Attest:
- -----------------------------------
Susan D. Erskine
Secretary
6.
<PAGE> 16
PMR CORPORATION
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON MARCH 5, 1998
The undersigned hereby appoints Fred D. Furman and Susan D. Erskine, and
each of them, as attorneys and proxies of the undersigned, with full power of
substitution, to vote all of the shares of stock of PMR Corporation which the
undersigned may be entitled to vote at the Special Meeting of Stockholders of
PMR Corporation to be held at the executive offices of PMR Corporation at 501
Washington Street, 5th Floor, San Diego, California on Thursday, March 5, 1998
at 10:00 a.m. (local time), and at any and all postponements, continuations and
adjournments thereof, with all powers that the undersigned would possess if
personally present, upon and in respect of the following matters and in
accordance with the following instructions, with discretionary authority as to
any and all other matters that may properly come before the meeting.
UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR
PROPOSAL 1, AS MORE SPECIFICALLY DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC
INSTRUCTIONS ARE INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.
MANAGEMENT RECOMMENDS A VOTE FOR PROPOSAL 1.
PROPOSAL 1: To approve an amendment to the Company's Restated Certificate of
Incorporation to increase the authorized number of shares of
Common Stock from 10,000,000 to 19,000,000 shares and to clarify
certain provisions of the Restated Certificate of Incorporation
relating to the issuance of Preferred Stock, limitation of
directors' personal liability and indemnification of agents, as
set forth in the Proxy Statement.
|_| FOR |_| AGAINST |_| ABSTAIN
(Continued and to be signed on other side)
<PAGE> 17
(Continued from other side)
DATED
------------------------------ -----------------------------------
-----------------------------------
SIGNATURE(S)
Please sign exactly as your name appears
hereon. If the stock is registered in
the names of two or more persons, each
should sign. Executors, administrators,
trustees, guardians and
attorneys-in-fact should add their
titles. If signer is a corporation,
please give full corporate name and have
a duly authorized officer sign, stating
title. If signer is a partnership,
please sign in partnership name by
authorized person.
PLEASE VOTE, DATE AND PROMPTLY RETURN THIS PROXY IN THE ENCLOSED RETURN ENVELOPE
WHICH IS POSTAGE PREPAID IF MAILED IN THE UNITED STATES.
