Securities and Exchange Commission
Washington, D.C. 20549
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
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permitted by Rule 14a-6(e)(2))
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[X] Soliciting Material Pursuant to Rule 14a-11(c) or
Rule 14a-12
Coastal Physician Group, Inc.
(Name of Registrant as Specified in its Charter)
Steven M. Scott, M.D.
(Name of Person(s) Filing Proxy Statement, if other than
the Registrant)
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LARGEST SHAREHOLDER OF COASTAL PHYSICIAN GROUP, INC.
ANNOUNCES INTENT TO SOLICIT PROXIES FOR
TWO NEW INDEPENDENT DIRECTORS
DURHAM, N.C. (July 9, 1996) -- Steven M. Scott,
M.D., the largest shareholder and a director of Coastal
Physician Group, Inc. (NYSE:DR), announced today that he
intends to solicit proxies in support of the election of
two new independent directors at Coastal's 1996 annual
meeting of shareholders. Coastal has a nine-member
classified board of directors, and three directors will
be elected at this year's meeting.
Dr. Scott was the founder of Coastal and has been a
director and major shareholder of Coastal since its
formation in 1977. He currently is the beneficial owner
of approximately 30% of Coastal's outstanding stock.
In addition to nominating two independent
candidates, Dr. Scott intends to seek shareholder
approval of a resolution requesting that a new committee
of independent directors be established to consider and
recommend the best available means by which shareholder
value may be maximized in the most prudent and
expeditious manner, including a possible sale of the
entire company.
Dr. Scott stated, "As the largest shareholder of
Coastal, I have become increasingly concerned that the
company's current leadership is weak and ineffective.
The election of two new independent directors and
shareholder approval of a resolution to maximize value
would send a strong message to the board to maximize the
value of the company for the benefit of all
shareholders."
Dr. Scott stated that Coastal's last shareholders'
meeting for the election of directors was held almost 14
months ago, and Coastal has not yet scheduled a 1996
shareholders' meeting. Accordingly, Dr. Scott is
demanding that Coastal promptly call a shareholders'
meeting to be held in late August of this year.
In addition, Dr. Scott and another director of
Coastal today commenced an action in the Superior Court
of North Carolina, Durham County, alleging, among other
things, breach of fiduciary duty and waste of corporate
assets by certain Coastal directors and officers.
Certain Additional Information: The following
individuals may be deemed participants in Dr. Scott's
solicitation of proxies at Coastal's 1996 Annual Meeting
of Shareholders: Steven M. Scott, M.D., Mitchell W.
Berger and Henry J. Murphy. Dr. Scott currently is the
beneficial owner of 7,146,193 shares of the Company's
common stock, representing approximately 30% of the
shares outstanding. Dr. Scott is a member of Coastal's
Board of Directors. He also has an Employment Agreement
with Coastal, and certain entities controlled by Dr.
Scott are engaged in various transactions with Coastal.
Information concerning Dr. Scott's Employment Agreement
and transactions with entities controlled by Dr. Scott is
set forth in Dr. Scott's preliminary proxy statement
which has been filed with the Securities and Exchange
Commission. Neither Mr. Murphy nor Mr. Berger currently
owns any common stock of the Company.
