<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[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
AMERICAN DENTAL TECHNOLOGIES, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[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):
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(4) Proposed maximum aggregate value of transaction:
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(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:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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<PAGE> 2
PRELIMINARY COPY
[Logo]
Dear Stockholder:
The Board of Directors has unanimously recommended a one-for-four reverse stock
split of the Company's common stock. Under the terms proposed, the number of
authorized shares of $0.01 par value common stock would be decreased from 50
million shares to 12.5 million shares of $0.04 par value common stock. At the
time the decrease becomes effective, each four shares of the Company's $0.01
par value issued and outstanding common stock will automatically be
reclassified into one share of common stock, par value $0.04 per share. Cash
payments will be made in lieu of any fractional shares.
In order to effect this reverse stock split, the Board of Directors has
directed that the written consent of stockholders be solicited in lieu of
holding a special meeting of stockholders so that the appropriate amendment to
the Company's Certificate of Incorporation can be made.
The accompanying Consent Statement explains the procedures required to consider
and act upon this proposal and provides additional related information. Only
stockholders of record at the close of business on December 27, 1996 will be
entitled to act on the proposal.
As soon as practicable after the effective date of the reverse stock split,
each stockholder of record on the effective date will be asked to return all
their $0.01 par value stock certificates and exchange them for reclassified
$0.04 par value stock certificates. For four shares of $0.01 par value common
stock, a stockholder will receive one share of $0.04 par value common stock.
This exchange of stock certificates is expected to take place in late March
1997.
YOUR BOARD OF DIRECTORS HAS APPROVED THE REVERSE STOCK SPLIT AS BEING IN THE
BEST INTERESTS OF ADT AND UNANIMOUSLY RECOMMENDS THAT YOU CONSENT TO THE
PROPOSED AMENDMENT TO THE CERTIFICATE OF INCORPORATION.
The Company's executive officers and directors, together with certain principal
stockholders, beneficially own 57.6% of the outstanding shares of common stock
as of the record date. Such persons have advised the Company that they intend
to consent to the foregoing proposal. If such persons give their consent as
indicated, approval of the reverse stock split and the amendment is assured.
PLEASE DO NOT MAIL YOUR CERTIFICATES TO THE COMPANY OR THE TRANSFER AGENT UNTIL
YOU ARE NOTIFIED IN WRITING BY THE COMPANY'S SECRETARY TO DO SO.
Sincerely,
William D. Myers Ben J. Gallant
Chairman of the Board President and CEO
<PAGE> 3
PRELIMINARY COPY
AMERICAN DENTAL TECHNOLOGIES, INC.
28411 Northwestern Highway, Suite 1100
Southfield, Michigan 48034-5541
NOTICE OF REQUEST FOR WRITTEN CONSENT OF STOCKHOLDERS
IN LIEU OF A SPECIAL MEETING
TO THE STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that the Stockholders of American Dental Technologies,
Inc. (the "Company" or "ADT"), are requested to provide their written consents
in lieu of a special meeting of stockholders to approve an amendment to the
Company's Certificate of Incorporation decreasing the amount of authorized
common stock from 50,000,000 to 12,500,000 shares, to increase the common stock
par value from $0.01 to $0.04 per share; and to effect a one-for-four reverse
stock split.
Only stockholders of record at the close of business on December 27, 1996 are
entitled to consent to this proposal.
YOUR CONSENT IS IMPORTANT. PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED FORM OF
CONSENT AND RETURN IT PROMPTLY IN THE ENCLOSED RETURN ENVELOPE. RETURNING THE
ENCLOSED FORM OF CONSENT WILL NOT AFFECT YOUR RIGHT TO WITHDRAW YOUR CONSENT AT
ANY TIME PRIOR TO THE END OF BUSINESS ON MARCH 4, 1997.
By order of the Board of Directors
Raymond F. Winter
January 24, 1997
<PAGE> 4
PRELIMINARY COPY
AMERICAN DENTAL TECHNOLOGIES, INC.
CONSENT STATEMENT
FOR A CONSENT OF STOCKHOLDERS IN LIEU OF A SPECIAL MEETING
INTRODUCTION
This Consent Statement is being sent to stockholders on or about January
24, 1997, and is furnished in connection with the solicitation of consents by
the Company's Board of Directors for the purposes set forth herein.
This consent may be withdrawn at any time before it is counted by
delivering written notice to the Secretary of the Company, or by executing and
delivering a later dated consent at any time prior to the end of business on
March 4, 1997. Unless withdrawn, the shares represented by the consents
received by the close of business on March 4, 1997 will be counted in
accordance with the specifications made.
The results will be reported in the Company's Annual Report on Form 10-K.
No other matters are being approved (or disapproved) by returning your consent
form.
The cost of solicitation of consents by the Board of Directors will be
borne by the Company. Such solicitation will be made by mail and may also be
made by directors, officers and employees of the Company personally or by
telephone, facsimile or other electronic means, without additional
compensation. In addition, Corporate Investor Communications, Inc., a proxy
soliciting firm, has been retained by the Company to assist in the solicitation
at a cost of approximately $5,000, plus out-of-pocket expenses. Consent
materials may also be distributed through brokers, custodians and other like
parties to the beneficial owners of common stock of the Company, and the
Company will reimburse such parties for their reasonable expenses incurred in
connection therewith.
Only holders of record of common stock at the close of business on
December 27, 1996 (the "Record Date"), are entitled to consent to the proposal.
As of December 27, 1996, there were 27,531,567 shares of $0.01 par value
common stock outstanding. Each share entitles the owner to one vote. The
receipt of the consent of the holders of a majority of the shares of the
Company's $0.01 par value common stock outstanding on the Record Date will
result in the approval of the proposal. Abstentions and broker non-votes will
have the effect of withholding consent.
If the necessary consents are received, the Company will make the
recommended amendment as soon as practicable after March 4, 1997 by filing an
Amendment to the Certificate of Incorporation with the Delaware Secretary of
State (the "Effective Date"). Upon the filing of such amendment, all
stockholders of the Company will be bound by the amendment, whether or not they
consented thereto. You will receive written notice about surrendering your
present stock certificates. Until then, your existing certificates will
continue to represent your interest in the Company's stock following the
Effective Date. DO NOT DESTROY YOUR CERTIFICATES AND DO NOT MAIL THEM TO THE
COMPANY OR THE TRANSFER AGENT UNTIL NOTIFIED IN WRITING BY THE COMPANY'S
SECRETARY TO DO SO.
GENERAL DESCRIPTION OF THE PROPOSAL
On December 17, 1996, the Board of Directors of the Company approved,
subject to adoption by stockholders, resolutions to amend the Certificate of
Incorporation of the Company to decrease the amount of authorized common stock
of the Company from 50,000,000 to 12,500,000 shares, to increase the par value
from $0.01 to $0.04 per share and to effect a one-for-four reverse stock split.
<PAGE> 5
The resolutions proposing the amendment to the Certificate of Incorporation and
effectuating the reverse stock split recommended by the Board of Directors are
attached hereto as Annex 1. Stockholders have no appraisal rights under
Delaware law or under the Company's Certificate of Incorporation or Bylaws in
connection with a reverse stock split.
As of January 24, 1997, there were 27,531,567 issued and outstanding
shares of common stock, par value $.01 per share, not including shares reserved
for exercise of any outstanding warrants or under the Company's existing stock
option plans. If the proposed amendment is approved, each four shares of the
Company's common stock, par value $.01 per share, then issued and outstanding
will be reclassified into one share of common stock, par value $0.04 per share,
immediately upon the effective date of the amendment. The number of issued and
outstanding shares of the Company's common stock would therefore be reduced to
a maximum of 6,882,891 shares, calculated without regard to fractional
interests, and each stockholder would hold a proportionately reduced number of
shares.
The voting rights and other rights which accompany the Company's common
stock will not be altered by the amendment or the reverse stock split, and the
proportion of the Company's outstanding shares held by each holder will not be
affected, except for minor differences resulting from cash payment in lieu of
fractional shares. Fractional shares of common stock will not be issued.
Stockholders entitled to receive a fractional share of common stock as a
consequence of the reverse stock split, will instead receive from the Company a
cash payment equal to such fraction multiplied by four times the average
closing price of the common stock on the Nasdaq Small Cap Market for the ten
calendar days preceding the Effective Date.
The Company's common stock is listed on the Nasdaq SmallCap Market. The
number of holders of the Company's common stock is approximately 4,000. The
Company does not currently anticipate that the reverse stock split will result
in any significant reduction in the number of stockholders or jeopardize its
continued listing on the Nasdaq SmallCap Market.
Under the Company's Certificate of Incorporation and pursuant to the laws
of the State of Delaware, the affirmative vote or written consent of holders of
a majority of the outstanding shares of $0.01 par value common stock is
required for adoption of the proposed amendment. As of the Record Date, the
Company's executive officers and directors, together with certain principal
stockholders of the Company, beneficially owned approximately 57.6% of the
Company's outstanding common stock. Such persons have advised the Company that
they intend to consent to the foregoing proposal. If such persons give their
consent as indicated, approval of the proposal is assured.
The following table summarizes the effect upon the common stock of the
Company as of September 30, 1996, before and after giving pro forma effect to
the proposed amendment to the Certificate of Incorporation and the proposed
one-for-four reverse stock split. The numbers set forth in the table have been
calculated without regard to fractional interests which will result to the
extent stockholders own a number of shares which is not an integral multiple of
four.
2
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<TABLE>
<CAPTION>
September 30, 1996
(Unaudited)
Actual As Adjusted
<S> <C> <C>
Stockholders' Equity:
Preferred stock, $0.01 par value, authorized
10,000,000 shares; none outstanding
Common stock, $0.01 par value, authorized
50,000,000 outstanding; 27,531,567 shares $275,265
(12,500,000 authorized and 6,882,891 issued
and outstanding; shares, $0.04 par
value, as adjusted) $275,265
Additional paid in capital 40,182,302 40,182,302
Accumulated deficit (27,725,582) (27,725,582)
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Total Stockholders' Equity $20,306,782 $20,306,782
=========== =============
Book value per share $.74 $2.95
=========== =============
</TABLE>
PURPOSE OF THE REVERSE STOCK SPLIT, RECOMMENDATION AND EFFECT UPON STOCKHOLDERS
The primary purpose of the reverse stock split is to reduce the number of
authorized and outstanding shares to increase the trading price and stimulate
broader investment interest in the Company's common stock. Many brokerage
firms and institutional investors do not effect transactions in stock, such as
the Company's common stock, which has a relatively low trading price. In
addition, stock which trades in the current trading range of the Company's
common stock may not be marginable and could be the subject of delisting
proceedings from the Nasdaq Stock Market.
It is not possible to predict the immediate impact that the reverse stock
split will have on the trading price of the Company's common stock. The
reverse stock split should ultimately result in an increase in the trading
price of the common stock, but not necessarily in the same proportion (four to
one) as the reduction in the number of outstanding shares. The Board of
Directors believes that the trading price, will however, increase in an amount
sufficient to encourage greater interest in the Company's common stock by the
financial and investment communities, qualify the Company for possible listing
on the Nasdaq National Market, and position the Company's common stock among
the securities of other companies who possess revenues, earnings, and growth
potential comparable to the Company. There can be no assurance that the
trading price will rise in proportion to the decrease in the number of shares
resulting from the reverse stock split or that any increased trading price will
be maintained for any period of time.
The Board of Directors believes the current per share trading price of the
Company's common stock may limit its marketability because of the reluctance of
many brokerage firms and institutional investors to recommend lower priced
stocks to their clients or to hold them in their own portfolios. Certain
policies and practices of the securities industry may tend to discourage
brokers and dealers from dealing in lower priced stocks. Some of those
policies and practices include time consuming procedures that make handling of
lower priced stock economically unattractive and commissions that are a higher
percentage of the stock sales price. An increase in the trading price of the
Company's common stock may make it more attractive to brokers and dealers who
are not now effecting trades in the Company's common stock. Such
firms may have a greater incentive to conduct research as to the Company and to
promote an investment in the Company's common stock to their customers. There
can be no assurance that an increase in the trading price will necessarily
result in additional brokers and dealers being willing to deal in the Company's
common stock.
IN VIEW OF THE FOREGOING FACTORS, THE BOARD OF DIRECTORS OF THE COMPANY
HAS UNANIMOUSLY RECOMMENDED APPROVAL OF THE PROPOSED AMENDMENT TO THE
CERTIFICATE OF INCORPORATION TO EFFECT THE REVERSE STOCK SPLIT.
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The holders of the presently issued and outstanding shares of the
Company's common stock have no preemptive or preferential rights to acquire any
securities of the Company under the existing Certificate of Incorporation and
will not have any such rights with respect to the reclassified shares
authorized by the proposed amendment to the Certificate of Incorporation.
STOCK CERTIFICATES AND FRACTIONAL SHARES
If the proposed amendment is adopted, stockholders will be notified as
soon as practicable (which is expected to be in late March 1997) and requested
to surrender certificates representing their currently issued and outstanding
shares of the Company's common stock, par value $0.01 per share, for
certificates representing reclassified shares of the Company's common stock,
par value $0.04 per share. Stock certificates in the hands of stockholders
representing four issued shares of common stock, par value $0.01 per share,
will be exchanged after the Effective Date for stock certificates representing
one issued share of common stock, par value $0.04 per share. The new common
stock to be issued upon approval of the reverse stock split will be fully paid
and nonassessable. Stockholders owning less than four shares, or a number of
shares which is not an integral multiple of four, on the Effective Date will
have a fractional interest equivalent to 1/4th of a new share for each old
share.
In the event that the number of shares of old common stock into which
shares of new common stock will be exchanged or converted includes a fraction,
the Company will pay to the holder of such fraction, in lieu of the issuance of
fractional shares of the Company, a cash amount which will be equal to the same
fraction multiplied by four times the average closing price of the common stock
on the Nasdaq SmallCap Market for the ten calendar days preceding the Effective
Date. The cash payable will not be paid to stockholders until the old
certificates have been surrendered for new certificates. The Company will
distribute cash in lieu of fractional shares in order to avoid the expense and
inconvenience of issuing and transferring fractional shares. The Company is
not effecting the reverse stock split for the purpose of giving any stockholder
an increased interest in the Company's assets or earnings.
The funds required to purchase the fractional interests created by the
reverse stock split are available and will be paid from the current cash
reserves of the Company. The Company's stockholder list indicates that a
portion of the Company's outstanding common stock is registered in the names of
clearing agencies and broker nominees. It is therefore not possible to predict
with certainty the number of full shares which will be represented by
fractional interests resulting from the reverse stock split and the total
amount which the Company will be required to pay to redeem such shares.
However, it is not anticipated that such amount will be significant or that the
Company will be required to borrow any funds to pay for fractional interests.
All expenses incurred by the Company in connection with the reverse stock split
and the amendment to the Certificate of Incorporation will be paid by the
Company.
ADJUSTMENTS TO EXISTING WARRANTS AND OPTIONS
When the proposed reverse stock split becomes effective, appropriate
adjustments will also be made in the number and price of shares of common
stock issuable upon exercise of any outstanding warrants and any outstanding
options granted under the Company's existing stock option plans. The following
table summarizes the number of shares reserved for outstanding warrants and for
outstanding and available options:
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<TABLE>
<CAPTION>
Number of Shares of Common Stock
--------------------------------
Prior to Reverse After Reverse
Warrants and Options Stock Split Stock Split
-------------------- ---------------- -------------
<S> <C> <C>
Reserved for issuance upon exercise of
Merger Warrants 6,996,913 1,749,228
Reserved for issuance upon exercise of
Myers warrants 1,378,002 344,500
Reserved for issuance upon exercise of
Maroney warrants 1,611,110 402,777
Reserved for issuance upon exercise of
Radner warrants 1,008,444 252,111
Reserved for issuance upon exercise of
Goldsmith warrants 393,000 98,250
Reserved for issuance upon exercise of
Pre-IPO options:
Available -- --
Outstanding 130,681 32,670
Reserved for issuance upon exercise of
Non-Qualified Stock Option Plan options:
Available 291,920 72,980
Outstanding 828,080 207,020
Reserved for issuance upon exercise of
Long-Term Stock Option Plan options:
Available 1,111,223 277,805
Outstanding 1,285,680 321,420
Reserved for issuance upon exercise of
Stock Option Plan For Employees options:
Available 156 39
Outstanding 65,191 16,297
</TABLE>
There will also be appropriate adjustments to the exercise prices of all
outstanding warrants and options to maintain their proportionate economic
effect. There are no other authorized but unissued shares reserved for
issuance for any other purpose. The Board of Directors has authority to cause
authorized but unissued shares to be issued for any proper corporate purpose
without further action by stockholders. However, the Company presently has no
plans to issue any shares other than as required for the proposed reverse stock
split or pursuant to existing warrants and options.
FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the material anticipated federal income tax
consequences of the reverse stock split to the Company and stockholders of the
Company. This summary is based on the federal income tax laws now in effect
and as currently interpreted. It does not take into account possible changes
in such laws or interpretations, including amendments to applicable statutes,
regulations and proposed regulations or changes in judicial or administrative
rulings, some of which may have retroactive effect. This summary is provided
for general information only and does not purport to address all aspects of the
possible federal income tax consequences of the reverse stock split and is not
intended as tax advice to any person. In particular, and without limiting the
foregoing, this summary does not consider the federal income tax consequences to
stockholders of the Company in light of their individual investment
circumstances or to holders subject to special treatment under the federal
income tax laws (for example, life insurance companies, regulated investment
companies and foreign taxpayers). The summary does not discuss any consequence
of the reverse stock split under any state, local or foreign tax laws.
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<PAGE> 9
No ruling from the Internal Revenue Service or opinion of counsel will be
obtained regarding the federal income tax consequences to the stockholders of
the Company as a result of the reverse stock split. ACCORDINGLY, EACH
STOCKHOLDER IS ENCOURAGED TO CONSULT HIS OR HER TAX ADVISOR REGARDING THE
SPECIFIC TAX CONSEQUENCES OF THE PROPOSED REVERSE STOCK SPLIT TO SUCH
STOCKHOLDER, INCLUDING THE APPLICATION AND EFFECT OF STATE, LOCAL AND FOREIGN
INCOME AND OTHER TAX LAWS.
The Company believes the reverse stock split would be a tax-free
recapitalization to the Company and its stockholders. If the reverse stock
split qualifies as a recapitalization described in Section 368(a)(1)(E) of the
Internal Revenue Code of 1986, as amended (the "Code"), (i) no gain or loss
will be recognized by holders of ADT common stock who exchange their old common
stock for new ADT common stock, except that holders of old common stock who
receive cash proceeds from the sale of fractional shares of old common stock
will recognize gain or loss equal to the difference, if any, between such
proceeds and the basis of their old common stock allocated to their fractional
share interests, and such gain or loss, if any, will constitute capital gain or
loss if their fractional share interests are held as capital assets at the
time of their sale; (ii) the tax basis of the new common stock received by
holders of ADT common stock will be the same as the tax basis of the old ADT
common stock exchanged therefor, less the tax basis allocated to fractional
share interests; and (iii) the holding period of the new common stock in the
hands of holders of new common stock will include the holding period of their
old common stock exchanged therefor, provided that such old ADT common stock
was held as a capital asset immediately prior to the exchange.
PRINCIPAL STOCKHOLDERS OF THE COMPANY
AND SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information regarding the ownership
of ADT common stock as of December 27, 1996, the Record Date, by the persons
listed who are known by ADT to own beneficially 5% or more of ADT's outstanding
shares of common stock (a "5% Owner"), by each of the current directors and
executive officers of ADT, and by all of ADT's directors and executive officers
as a group.
<TABLE>
<CAPTION>
Number of Percent of
Name (1) Shares (2) Class(3)
---------- ----------
<S> <C> <C>
William D. Myers, M.D., Chairman of the Board and Irene Myers(4) 4,714,595 16.3
Ben J. Gallant, President, Chief Executive Officer, Director 3,767,456 13.7
William D. Maroney and Aimee Maroney (5) 3,253,182 11.2
Michael F. Radner 2,705,529 9.4
Charles A. Nichols, Director 1,993,850 7.2
Denics Co., Ltd. 1,689,055 6.1
Wayne A. Johnson II, Director 871,519 3.2
Terry D. Myers, Sr. Vice President - Dental Division (6) 610,518 2.2
Anthony D. Fiorillo, Director 605,000 2.2
John E. Vickers III, Director 518,600 1.9
Diane M. Miller, Chief Financial Officer 240,000 (7)
Johannes Homolko, Director of European Operations 150,000 (7)
Raymond F. Winter, Secretary 106,296 (7)
William S. Parker, Vice President - Marketing and Sales 95,400 (7)
Bertrand R. Williams, Sr., Director 37,578 (7)
J. Bernard Machen, Director 5,000 (7)
All executive officers and directors as a group (13 persons ) 13,715,812 45.3
</TABLE>
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<PAGE> 10
(1) The business addresses of the 5% Owners are as follows: William D.
Myers and Irene Myers, 29877 Telegraph Road, Southfield, Michigan
48034; Ben J. Gallant and Charles A. Nichols, 5555 Bear Lane, Corpus
Christi, Texas 78405; William D. Maroney, Aimee Maroney, and Michael
F. Radner, 28411 Northwestern Highway, Suite 1100, Southfield,
Michigan 48034; and Denics Co., Ltd., Yotsuya Y's Bldg, 7-6
Honshio-cho, Shinjuku-ku Tokyo 160 Japan.
(2) The column sets forth shares of ADT common stock which are deemed to
be "beneficially owned" by the persons named in the table under Rule
13d-3 of the SEC, including shares of ADT common stock that may be
acquired upon the exercise of stock options or common stock purchase
warrants that are presently exercisable or become exercisable within
60 days as follows: William D. Myers and spouse- 1,384,252 shares;
William D. Maroney and spouse - 1,611,110 shares; Michael F. Radner -
1,139,125 shares; Terry D. Myers - 200,000 shares; Anthony D.
Fiorillo - 600,000 shares; Diane M. Miller - 240,000 shares; Johannes
Homolko - 150,000 shares; Raymond F. Winter - 95,000 shares; William
S. Parker - 95,000 shares; Bertrand R. Williams, Sr. - 6,250 shares;
J. Bernard Machen - 5,000 shares; and all executive officers and
directors as a group - 2,775,502 shares. The column excludes shares
of ADT common stock that may be acquired upon the exercise of the
following Merger Warrants (defined below) that will become exercisable
August 1, 1997: Ben J. Gallant - 1,851,458 shares; Charles A. Nichols -
1,203,863 shares; Wayne A. Johnson II - 527,687 shares; Denics - 507,372
shares; and John E. Vickers III - 215,865 shares. Each of the
persons named in the table has sole voting and investment power with
respect to all shares beneficially owned by them, except as described
in the following footnotes.
(3) For purposes of calculating the percentage of ADT common stock
beneficially owned, the shares issuable to each person under stock options
or common stock purchase warrants exercisable currently or within 60 days
are considered outstanding and added to the shares of ADT common stock
actually outstanding. The number of shares outstanding on December 27,
1996 was 27,531,567.
(4) Includes 1,496,287 shares of ADT common stock and 922,222 common
stock purchase warrants owned jointly with and/or individually by his
wife, Irene Myers.
(5) Includes 1,265,436 shares of ADT common stock and 1,611,110 common
stock purchase warrants owned by his wife, Aimee Maroney.
(6) Includes 395,133 shares of ADT common stock owned by his wife.
(7) Less than one percent.
- ---------------
Ben J. Gallant, Charles A. Nichols, Denics Co., Ltd., Wayne A. Johnson II
and John E. Vickers III, are currently 5% Owners, officers and/or directors of
ADT and were formerly principal stockholders, officers and/or directors of
Texas Airsonics, Inc. ("Texas Air"). At the close of business on July 31,
1996, Texas Air was merged with and into ADT Merger Corp. ("Sub"), a wholly
owned subsidiary of ADT, and Texas Air's separate existence ceased (the
"Merger"). Concurrently, Sub changed its name to Texas Airsonics, Inc.
On July 31, 1996, the effective date of the Merger, each issued and
outstanding share of Texas Air common stock was converted into the right to
receive 5.425 shares of ADT common stock together with a warrant to purchase
3.321 shares of ADT common stock at a purchase price of $1.4104 per share for a
period commencing August 1, 1997 and ending July 31, 1999 (a "Merger Warrant").
On July 31, 1996, ADT issued to Texas Air stockholders 11,429,772 shares of
the Company's common stock and Merger Warrants to acquire an additional
6,996,913 shares of ADT common stock. No fractional shares of ADT common stock
were or will be issued because of the
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<PAGE> 11
Merger or upon exercise of the Merger Warrants. A cash payment was or will be
made (based on the closing sale price of ADT common stock as reported by the
Nasdaq SmallCap Market on July 31, 1996 or, in the case of a Merger Warrant, on
the date of exercise) in lieu of any fractional share to which a stockholder
might otherwise be entitled.
On September 20, 1996, Mr. Gallant was appointed President and Chief
Operating Officer of the Company and on November 4, 1996, he was appointed
Chief Executive Officer. Effective as of the end of business on December 31,
1996, Texas Air was merged into American Dental Technologies, Inc. and its
existence as a separate subsidiary ceased.
STOCKHOLDER'S PROPOSALS FOR ADT'S 1997 ANNUAL MEETING
Stockholder proposals intended to be presented at the ADT Annual Meeting
of Stockholders in 1997 must be received by ADT no later than February 27,
1997.
By Order of the Board of Directors
Raymond F. Winter, Secretary
Southfield, Michigan
January 24, 1997
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<PAGE> 12
ANNEX 1
BOARD OF DIRECTORS RESOLUTIONS
REGARDING REVERSE STOCK SPLIT
RESOLVED, that the Board of Directors of the Company deems it advisable
and in the best interests of the Company to effect a reverse stock split
whereby the amount of Common Stock par value $0.01 per share, which the Company
is authorized to issue, be decreased from 50,000,000 shares to 12,500,000
shares and whereby each four shares of the Company's Common Stock, par value
$0.01 per share, presently issued and outstanding be reclassified into one
share of Common Stock, par value $0.04 per share; and
FURTHER RESOLVED, that Article Fourth of the Certificate of Incorporation
of the Company be amended to read as follows:
"FOURTH: The aggregate number of shares which the Company
shall have authority to issue is 22,500,000 to be divided into (a)
12,500,000 shares of Common Stock, par value $0.04 per share, and
(b) 10,000,000 shares of Preferred Stock, par value $0.01 per
share."
FURTHER RESOLVED, that the number of shares of Common Stock issued and
outstanding immediately prior to the effective date of the amendment to the
Certificate of Incorporation reducing the Company's authorized Common Stock
from 50,000,000 shares to 12,500,000 shares shall be reduced on the effective
date in the same proportion and each four shares of Common Stock then owned by
a stockholder of the Company shall automatically be reclassified and changed
into one issued and outstanding share of Common Stock and to the extent that
each stockholder owns a number of shares which are not equally divisible by
four, the Company shall pay such stockholder in cash, in lieu of issuing a
fractional share an amount equal to the fraction multiplied by four times the
average closing price of the Common Stock on the Nasdaq SmallCap Market for the
ten calendar days preceding the effective date of the reverse stock split; and
FURTHER RESOLVED, that upon the reverse stock split becoming effective,
appropriate adjustments shall also be made to the number and price of shares of
$0.01 par value Common Stock issuable upon the exercise of all outstanding
warrants and outstanding options granted under the Company's existing stock
option plans; and
FURTHER RESOLVED, that the proposed reverse stock split and the amendment
to the Certificate of Incorporation shall be submitted to the stockholders for
their written consent in lieu of a special meeting of stockholders; and
FURTHER RESOLVED, that the officers of the Company be, and any one of them
hereby is, authorized and directed to take such action and to execute and
deliver such documents on behalf of the Company to carry out the intent of the
foregoing resolutions as any such officer may determine is necessary, desirable
or appropriate, including but without limitation, the execution,
acknowledgment, filing and recording of a Certificate of Amendment to the
Certificate of Incorporation setting forth the amendment to Article Fourth
thereof changing the authorized Common Stock and any other actions required for
the reclassification of the issued and outstanding shares of Common Stock.
<PAGE> 13
AMERICAN DENTAL TECHNOLOGIES, INC.
THIS CONSENT IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF AMERICAN DENTAL TECHNOLOGIES, INC.
I (we) hereby consent, withhold consent or abstain, as indicated on the reverse
side of this Form Of Consent, all of the shares of common stock of American
Dental Technologies, Inc. ("ADT") with respect to which I am (we are) entitled
to act.
THIS FORM OF CONSENT, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED; IF NO DIRECTION IS MADE WITH RESPECT TO A PROPOSAL, THIS FORM OF
CONSENT WILL BE COUNTED AS A CONSENT TO THE PROPOSAL.
I (we) acknowledge receipt of the Notice of Request for Written Consent of
Stockholders in Lieu of a Special Meeting and the Consent Statement dated
January 24, 1997 and revoke all former consents with respect to the proposal.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
______________________________ _____________________________
______________________________ _____________________________
______________________________ _____________________________
<PAGE> 14
FORM OF CONSENT
<TABLE>
<S><C>
/X/ PLEASE MARK CHOICE
AS IN THIS EXAMPLE
Proposal to approve an amendment to the Company's Certificate of
Incorporation decreasing the amount of authorized common stock from / / / / / /
50,000,000 to 12,500,000 shares, to increase the common stock par value Consent Withhold Abstain
from $0.01 to $0.04 per share and to effect a one-for-four reverse stock Consent
split, as described in the Consent Statement
Please be sure to sign and date
this form of consent. Date: Mark box at right if comments or
----- address change has been noted on the
reverse side of this card. / /
Note: Please sign exactly as name(s)
- ---------------------- ------------------- appear(s) on stock records.
Stockholder sign above Co-owner sign above When signing as attorney, administrator,
trustee, guardian or corporate officer,
please so indicate.
</TABLE>
AMERICAN DENTAL TECHNOLOGIES, INC.
Dear Stockholder:
Please take note of the important information enclosed with this Consent.
There is an important matter related to your company that requires your
immediate attention and approval. This matter is discussed in detail in the
enclosed consent materials.
Please mark the box on the Form Of Consent to indicate how your shares shall be
counted. Then sign the card, detach it and return your form of consent in the
enclosed postage paid envelope.
Your Form Of Consent must be received prior to the end of business on March 4,
1997.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
American Dental Technologies, Inc.
