SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
FILED BY THE REGISTRANT /X/
FILED BY A PARTY OTHER THAN THE REGISTRANT / /
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Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, For Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
PALOMAR MEDICAL TECHNOLOGIES, INC.
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(Name Of Registrant As Specified In Its Charter)
NOT APPLICABLE
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(Name Of Person(s) Filing Proxy Statement)
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:
N/A
2) Aggregate number of securities to which transaction applies: N/A
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):
$54,000,000
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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Palomar Medical Technologies, Inc.
45 Hartwell Avenue
Lexington, MA 02421-3102
June 11, 1999
DEAR FELLOW SHAREHOLDER:
By now, you may have received a letter from Mark Smith together with
proxy materials from the Monterey Stockholders Group seeking your vote to hand
over control of your Company at the June 23rd annual meeting. MR. SMITH FREELY
ATTACKS YOUR BOARD USING STATISTICS BEGINNING IN 1996 -- BEFORE ANY OF YOUR
CURRENT DIRECTORS JOINED PALOMAR -- AND PRESENTS YOU WITH CONTRADICTORY
STATEMENTS AND A SO-CALLED "PLAN" WHICH, IN OUR OPINION, IS RISKY AT BEST. We
urge you not to be misled by Mr. Smith and his dissident group. Please reelect
your Board by signing, dating and mailing the enclosed WHITE management proxy
today.
WHAT ARE MR. SMITH AND THE MONTEREY GROUP TRYING TO SAY?
o In his letter, Mr. Smith tells you "we are not content with a philosophy
that focuses on the nebulous long term."
BUT IN THE VERY SAME LETTER, MR. SMITH SAYS "THE ONLY WAY THE MARKET WILL
REALIZE THE VALUE IN OUR COMPANY IS THROUGH EARNINGS PER SHARE, PROFITABLE
OPERATIONS THAT GROW OVER TIME."
o Monterey tells you its candidates have the "experience, the track record
and a plan for the Company that justify your vote and confidence."
BUT THEY ADMIT THAT THE FIRST THING THEY WILL NEED TO DO IF ELECTED IS HIRE
AN AS YET UNNAMED CONSULTANT TO "GUIDE" THEM.
o In his letter, Mr. Smith tells you the Monterey group intends to hold onto
their Palomar shares rather than sell them in their proposed share
repurchase plan. But in the group's proxy materials, they admit that they
could change their intentions if they "needed liquidity for business
contingencies that are not presently known."
WHICH IS IT MR. SMITH? ARE YOU TRYING TO GAIN CONTROL OF PALOMAR IN ORDER
TO BENEFIT ALL ITS SHAREHOLDERS OR MERELY GAIN LIQUIDITY FOR YOUR OWN
POSITION? YOU CAN'T HAVE IT BOTH WAYS.
o Mr. Smith suggests that licensing your Company's technology may not be a
good idea, and that his group will look to the corrective vision industry
as another model.
THIS IS ANOTHER EXAMPLE OF MR. SMITH'S LACK OF UNDERSTANDING OF OUR
INDUSTRY AND THE SUPERFICIAL ANALYSIS THAT UNDERLIES HIS GROUP'S PLAN. BY
ITS NATURE, THE CORRECTIVE VISION LASER INDUSTRY CANNOT SERVE AS A USEFUL
"MODEL" FOR PALOMAR. IT HAS FEWER COMPETITORS, LONGER PRODUCT LIFE CYCLES
AND DIFFERENT FDA BARRIERS TO ENTRY, TO NAME JUST A FEW DIFFERENCES.
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MONTEREY ADMITS ITS "PLAN" IS RISKY
Although no mention of risk can be found in Mr. Smith's short letter, a
closer look at the Monterey group's proxy materials reveals that, in the
Monterey group's own words, "stockholders should be aware that there are certain
elements of risk attendant to the Monterey plan." For example:
1. Monterey admits that its contemplated cost reductions MAY NOT BE
ACHIEVABLE.
2. Monterey admits there can be no assurance that the new Board could engage
replacement management quickly or at all, and if competent replacements
were not hired, THE COMPANY WOULD SUFFER.
SUPPORT YOUR BOARD
There is no "quick fix" available to us or any group that would bring the
price of Palomar shares up to prior levels overnight. Your Board is committed to
restoring value to Palomar's shareholders through continued profitability and
earnings growth, not by financial gimmickry that benefits few at the expense of
many. Our efforts on your behalf have already generated the first profits
Palomar has ever recorded. We are convinced that if we continue on this path, we
will build a better Company whose inherent value will be recognized in the
marketplace by sustained growth in Palomar's stock price.
We are also not averse to a prudent stock repurchase program, as evidenced
by our commitment of $5 million toward the purchase of Palomar shares. However,
we believe it would be totally irresponsible and contrary to your best interests
to commit up to a third of Palomar's free cash toward the repurchase of the
Company's shares, as the Monterey group wants to do. In our opinion, such a
course of action would deplete funds needed to generate revenue through new
products, thereby crippling your Company's future, in exchange for the potential
of a small increase in the price of Palomar stock, which would quickly vanish
once the program were completed.
The annual meeting is just a few days away. Regardless of the number of
shares you own, your vote is extremely important. Please be sure your shares are
represented and voted FOR the reelection of your Board by signing, dating and
mailing the enclosed WHITE proxy today. If you have already voted your WHITE
proxy AND HAVE NOT
<PAGE>
RETURNED ANY BLUE CARDS, you need do nothing further. We hope every shareholder
will vote his or her shares.
Thank you for your support.
ON BEHALF OF THE BOARD OF DIRECTORS
Sincerely,
/s/ Louis P. Valente
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LOUIS P. VALENTE
Chairman and Chief Executive Officer
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IMPORTANT
Please be sure your latest dated proxy is a WHITE proxy voting FOR the
management nominees. A later dated blue proxy, even if marked "Withhold
Authority" to vote for the Monterey candidates, will only serve to revoke your
vote for management.
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If you have any questions or need assistance in voting your shares, please
call Palomar at (781) 676-7300 or D.F. King & Co., Inc., which is assisting us
in this matter, toll-free at (800) 628-8538.
<PAGE>
PROXY/VOTING INSTRUCTION CARD
PALOMAR MEDICAL TECHNOLOGIES, INC.
C/O THE AMERICAN STOCK TRANSFER & TRUST COMPANY
40 WALL STREET, 41ST FLOOR, NEW YORK, NEW YORK 10005
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
I (WHETHER ONE OR MORE OF US) APPOINT JOSEPH P. CARUSO AND SARAH
BURGESS REED TO BE MY PROXIES. THE PROXIES MAY VOTE ON MY BEHALF, IN ACCORDANCE
WITH MY INSTRUCTIONS, ALL OF MY SHARES ENTITLED TO VOTE AT THE SPECIAL MEETING
OF STOCKHOLDERS OF PALOMAR MEDICAL TECHNOLOGIES, INC. THE MEETING IS SCHEDULED
FOR APRIL 21, 1999, BUT THIS PROXY INCLUDES ANY ADJOURNMENT(S) OF THAT MEETING.
THE PROXIES MAY VOTE ON MY BEHALF AS IF I WERE PERSONALLY AT THE MEETING.
PLEASE COMPLETE, DATE AND SIGN ON REVERSE SIDE AND
RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
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^ DETACH HERE BEFORE MAILING TOP PORTION ^
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY ( )
IN THEIR DISCRETION, THE PROXIES MAY VOTE ON ANY OTHER BUSINESS THAT
PROPERLY COMES BEFORE THE MEETING. THIS PROXY WHEN PROPERLY EXECUTED WILL BE
VOTED AS INSTRUCTED BELOW BY THE UNDERSIGNED STOCKHOLDER. IF NO MARKING IS MADE,
THIS PROXY WILL BE DEEMED TO BE DIRECTION TO VOTE FOR PROPOSALS 1 AND 2.
The Board of Directors recommends a vote FOR:
1. To select Arthur Andersen LLP as the company's auditors for fiscal
1999.
FOR ( ) AGAINST ( ) ABSTAIN ( )
2. The election of each of the following nominees as Directors of Palomar
to serve until the 2000 annual meeting of stockholders and until their
respective successors are elected and have qualified.
FOR AGAINST WITHHELD
Nicholas P. Economou ( ) ( ) ( )
James G. Martin ( ) ( ) ( )
A. Neil Pappalardo ( ) ( ) ( )
Louis P. Valente ( ) ( ) ( )
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED OR, IF
NO DIRECTION IS GIVEN WITH RESPECT TO ONE OR MORE OF THE PROPOSALS SET
FORTH ABOVE, WILL BE VOTED FOR SUCH PROPOSAL OR PROPOSALS.
DATED: _________________, 1999
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Signature of Stockholder(s)
Please promptly date and sign this proxy and mail it in the enclosed envelope to
assure representation of your shares. No postage need be affixed if mailed in
the United States. PLEASE SIGN EXACTLY AS NAME(S) APPEAR ON STOCK CERTIFICATE.
If stockholder is a corporation, please sign full corporate name by president or
other authorized officer and, if a partnership, please sign full partnership
name by an authorized partner or other person.
Mark here if you plan to attend the meeting. / /
[NOTE THAT YOU MAY ATTEND THE MEETING EVEN IF YOU DO NOT CHECK THE BOX.]
