SCHEDULE 14A
(RULE 14A-1-1)
INFORMATION REQUIRED IN PROXY STATEMENT
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 [ ]
Check the appropriate box:
- --------------------------------
[x] Preliminary proxy statement
[ ] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11 (c) or Rule 14a-12
[ ] Confidential for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
IntegraMed America, Inc.
---------------------------------------------------
(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:
<PAGE>
INTEGRAMED AMERICA, INC.
One Manhattanville Road
Purchase, New York 10577
Dated: October ______, 1998
Dear Stockholder:
You are cordially invited to attend the Special Meeting of the
Stockholders of IntegraMed America, Inc. (the "Company") to be held on November
17, 1998, at 10:00 a.m. local time at the Company's headquarters, One
Manhattanville Road, Purchase, New York 10577.
As you are aware, the Company's Common Stock, par value $.01 per share
(the "Common Stock") is listed for quotation on the Nasdaq National Market. On
September 21, 1998, the Company received a written notice from the Nasdaq
National Market notifying the Company that its Common Stock has failed to
maintain a closing bid price of greater than or equal to $1.00 per share for 30
consecutive trading days prior to September 21, 1998. While the Company's Common
Stock continues to remain listed, failure to maintain a bid price in excess of
$1.00 per share on an ongoing basis consistent with the requirements of the
Nasdaq National Market could result in the future delisting of the Common Stock
on the Nasdaq National Market, which might adversely affect the trading in and
liquidity of the Common Stock.
Your Board of Directors has determined that an amendment to the
Company's Amended and Restated Certificate of Incorporation effecting a
one-for-four reverse stock split of the Common Stock is the best method of
returning and maintaining the shares of the Company's Common Stock at a closing
bid price above $1.00. The affirmative vote of a majority of the outstanding
shares of Common Stock and Preferred Stock of the Company is required to effect
the proposed reverse stock split. The Company's ability to implement its plans,
including continued listing of its Common Stock on the Nasdaq National Market,
is conditioned on the approval by you of the reverse stock split. Detailed
information concerning the reverse stock split is set forth in the attached
proxy statement which we urge you to read carefully.
At the Special Meeting, you will be asked to consider and vote upon an
amendment to the Company's Amended and Restated Certificate of Incorporation to
effect a reverse stock split of the Company's Common Stock such that every four
(4) shares of Common Stock outstanding would be converted into one (1) share of
new Common Stock.
Your vote is important to the Company. Whether or not you plan to
attend the Special Meeting in person and regardless of the number of shares you
own, please complete, sign, date and return the enclosed proxy card promptly in
the enclosed pre-addressed envelope. No postage is required if mailed in the
United States.
Sincerely yours,
Gerardo Canet
Chairman of the Board, President and Chief Executive Officer
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<PAGE>
INTEGRAMED AMERICA, INC.
One Manhattanville Road
Purchase, New York 10577
-------------------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To be held November 17, 1998
-------------------------------------------
To the Stockholders of IntegraMed America, Inc.:
Notice is hereby given that a Special Meeting of the Stockholders of
IntegraMed America, Inc. (the "Company") will be held on November 17, 1998, at
10:00 a.m. local time at the Company's headquarters, One Manhattanville Road,
Purchase, New York 10577 for the following purposes:
1. Approval of the Amendment to the Company's Amended and Restated
Certificate of Incorporation to effect a one-for-four reverse
stock split of the issued and outstanding shares of the Common
Stock, par value $.01 per share, of the Company; and
2. Consideration of and action upon such other matters as may
properly come before the meeting or any adjournment or
adjournments thereof.
The close of business on October 16, 1998 has been fixed as the record
date for the determination of stockholders entitled to notice of and to vote at
the meeting.
All stockholders are cordially invited to attend the meeting. Whether
or not you expect to attend, you are respectfully requested by the Board of
Directors to sign, date and return the enclosed proxy promptly. Stockholders who
execute proxies retain the right to revoke them at any time prior to the voting
thereof. A return envelope which requires no postage if mailed in the United
States is enclosed for your convenience.
By Order of the Board of Directors,
Claude E. White
Secretary
Dated: October ______, 1998
<PAGE>
SPECIAL MEETING OF STOCKHOLDERS
OF
INTEGRAMED AMERICA, INC.
---------------
PROXY STATEMENT
---------------
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Board of Directors of IntegraMed America, Inc., a Delaware
corporation (the "Company"), for a Special Meeting of Stockholders to be held on
November 17, 1998, at 10:00 a.m. and for any adjournment or adjournments
thereof, for the purposes set forth in the accompanying NOTICE OF SPECIAL
MEETING OF STOCKHOLDERS. Any stockholder giving such a proxy has the power to
revoke it at any time before it is voted. Written notice of such revocation
should be forwarded directly to the Corporate Secretary of the Company, at the
address stated below. Attendance at the meeting will not have the effect of
revoking the proxy unless such written notice is given or the stockholder votes
by ballot at the meeting.
If the enclosed proxy is properly executed and returned, the shares
represented thereby will be voted in accordance with the directions thereon and
otherwise in accordance with the judgment of the persons designated as proxies.
Any proxy on which no direction is specified will be voted in favor of the
proposal of an amendment to the Company's Amended and Restated Certificate of
Incorporation to effect a one-for-four reverse stock split of the Company's
Common Stock, par value $.01 per share.
The approximate date on which this Proxy Statement and the accompanying
form of proxy will first be mailed or given to the Company's stockholders is
October , 1998.
The Company's principal executive offices are located at One
Manhattanville Road, Purchase, New York 10577 and the telephone number is (914)
253-8000.
VOTING SECURITIES
Holders of shares of Common Stock, par value $.01 per share (the
"Common Stock") and Series A Cumulative Convertible Preferred Stock (the "Series
A Preferred Stock") of record as of the close of business on October 16, 1998
(the "Record Date"), are entitled to notice of and to vote at the Special
Meeting. On the Record Date there were issued and outstanding ___________ shares
of Common Stock and 165,644 shares of Series A Preferred Stock entitled to vote
at the Special Meeting. Each outstanding share is entitled to one vote upon the
matters to be acted upon at the Special Meeting. A majority of the outstanding
shares of Common Stock and Series A Preferred Stock entitled to vote and
represented at the Special Meeting in person or by proxy shall constitute a
quorum. Assuming a quorum is present, the affirmative vote of a majority of the
shares of Common Stock and Series A Preferred Stock outstanding and entitled to
vote, excluding broker non-votes, is required to approve the Amendment to the
Company's Amended and Restated Certificate of Incorporation. Abstentions and
broker non-votes are counted for purposes of determining the presence or absence
of a quorum for the transaction of business. If a stockholder, present in person
or by proxy, abstains on any matter, the stockholder's shares of Common Stock
and/or Series A Preferred Stock will not be voted on such matter. Thus, an
abstention from voting on any matter has the same legal effect as a vote
"against" the matter, even though the stockholder may interpret such action
differently. Except for determining the presence or absence of a quorum for the
transaction of business, broker non-votes are not counted for any purpose in
determining whether a matter has been approved.
<PAGE>
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of September 30, 1998, certain
information regarding beneficial ownership of the Company's outstanding Common
Stock of (i) each beneficial owner of more than 5% or more of the shares of
Common Stock, (ii) each of the Company's current named executive officers and
directors and (iii) all executive officers and directors of the Company as a
group.
Shares of
Common Stock Percent of
Beneficially Common Stock
Name and Address Owned (1),(2) Outstanding
- ---------------- ------------- -----------
Entities affiliated with
Morgan Stanley, Dean Witter,
Discover & Co.
1585 Broadway
New York, NY 10036..................... 3,475,294(3) 16.08%
Gerardo Canet ......................... 2,184,579(4),(5) 10.11%
Eugene Curcio.......................... 10,000 *
Jay Higham............................. 84,500(5) *
Donald S. Wood, Ph.D................... 61,687(5) *
M. Fazle Husain........................ 3,475,294(3) 16.08%
Michael J. Levy, M.D................... 357,268(5) 1.67%
Sarason D. Liebler..................... 71,450(5) *
Aaron S. Lifchez, M.D.................. 276,741(5) 1.29%
Patricia M. McShane, M.D............... 14,250(5) *
Lawrence Stuesser ..................... 227,200(5) 1.06%
Elizabeth Tallett...................... -- --
All executive officers and directors
as a group (12 persons) ............. 6,767,726(3), (4), (5) 30.61%
- ----------------------
* Represents less than 1% of outstanding shares of Common Stock
(1) For the purposes of this Proxy Statement, beneficial ownership is defined
in accordance with the rules of the Securities and Exchange Commission and
generally means the power to vote and/or to dispose of the securities
regardless of any economic interest therein.
(2) As of September 30, 1998, there were 165,644 shares of Series A Preferred
Stock outstanding of which 150,000 shares, or 90.6%, were owned by Barry
Blank (Box 32056, Phoenix, AZ 85064) as reported on his Schedule 13D filed
with the Securities and Exchange Commission (the "Commission") on June 6,
1994. Upon conversion of each share of Series A Preferred Stock owned by
Mr. Blank into approximately 3.16 shares of Common Stock, he would own
2.2% of the Company's outstanding Common Stock.
(3) Includes 3,235,294 shares of Common Stock and 240,000 shares of Common
Stock issuable upon immediately exercisable warrants held by Morgan
Stanley Venture Partners III, L.P. ("MSVP III, L.P."), Morgan Stanley
Venture Investors III, L.P. ("MSVI III, L.P."), and The Morgan Stanley
Venture Partners Entrepreneur Fund, L.P. ("MSVPE Fund, L.P.") (MSVP III,
L.P., MSVI III, L.P., and MSVPE Fund, L.P. are collectively referred to as
the "Funds"). Fazle Husain, a director of the Company, is a general
partner of the Funds. Mr. Husain may be deemed to beneficially own the
shares held by the Funds, although he has disclaimed beneficial ownership.
(4) Includes an aggregate of 1,833,329 shares of Common Stock owned by certain
physicians for which Gerardo Canet has a proxy to vote for a two-year
period with respect to (i) the election of Directors or any amendment to
the Company's Amended and Restated Certificate of Incorporation affecting
Directors and (ii) any change in stock options for management and
Directors of the Company.
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<PAGE>
(5) Includes (or consists of) currently exercisable options, including options
exercisable within sixty days, to purchase Common Stock as follows:
Gerardo Canet - 226,250; Jay Higham - 62,500; Donald S. Wood - 48,039;
Sarason Liebler - 55,000; Aaron Lifchez - 9,375; Patricia McShane -
14,250; and Lawrence Stuesser - 45,000; and currently exercisable warrants
to purchase Common Stock as follows: Michael Levy - 15,000 and Aaron
Lifchez - 15,000.
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<PAGE>
APPROVAL OF THE AMENDMENT TO THE
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
GENERAL
The Board of Directors of the Company has approved and recommends to the
stockholders that they consider and approve a proposal to amend the Company's
Amended and Restated Certificate of Incorporation ("Certificate of
Incorporation") pursuant to which each four (4) shares of the issued and
outstanding shares of Common Stock of the Company, par value $.01 per share (the
"Old Common Stock") shall be converted into one (1) issued and outstanding share
of Common Stock of the Company, par value $.01 per share (the "New Common
Stock"). This proposed amendment is referred to herein as the "Reverse Stock
Split". If the proposed amendment is approved by stockholders and following such
approval the Board of Directors still believes the Reverse Stock Split is in the
best interests of the Company and its stockholders, Article IV(A) of the
Company's Certificate of Incorporation would be amended as set forth in the
Certificate of Amendment attached to this Proxy Statement as Exhibit A (the
"Amendment"). The effective date of the Reverse Stock Split shall be the date
upon which said Amendment is filed with the Secretary of State of the State of
Delaware (the "Effective Date").
The Certificate of Incorporation, as amended to date, provides for
50,000,000 authorized shares of Common Stock, par value $.01 per share;
21,372,369 of which were issued and outstanding as of September 30, 1998 and
5,000,000 shares of Preferred Stock, $1.00 par value per share, 2,500,000 of
which are designated the Series A Cumulative Convertible Preferred Stock,
165,644 shares of which were issued and outstanding as of September 30, 1998.
The Company is not proposing to reduce the amount of its authorized capital.
On September 24, 1998, the Board of Directors of the Company authorized
the repurchase of up to $2 million of the Company's outstanding shares of Common
Stock from time to time on the open market at prevailing market prices or
through privately negotiated transactions. Commencing October 1, 1998 through
the Record Date, the Company has purchased $_________ of Common Stock (_______
shares). Such repurchased shares will be held by the Company as treasury shares
and will reduce the number of outstanding shares of the Company's Common Stock.
In order to effect the Reverse Stock Split, the stockholders are being
asked to approve the Amendment. The Board of Directors of the Company believes
that the Reverse Stock Split is in the best interests of both the Company and
its stockholders and has approved the Reverse Stock Split. The Board of
Directors of the Company reserves the right, notwithstanding stockholder
approval and without further action by the stockholders, to decide not to
proceed with the Reverse Stock Split if at any time prior to its effectiveness
it determines, in its sole discretion, that the Reverse Stock Split is no longer
in the best interests of the Company and its stockholders.
EFFECTS OF THE REVERSE STOCK SPLIT
If effected, the Reverse Stock Split would reduce the number of
outstanding shares of Old Common Stock from [21,372,369] as of September 30,
1998 to approximately [5,343,092] shares of New Common Stock as of the Effective
Date. (The foregoing assumes no issuances or repurchases of Common Stock between
September 30, 1998 and the Effective Date.) The Reverse Stock Split would have
no effect on the number of authorized shares of the Common Stock or the par
value of the stock and each share of New Common Stock will continue to entitle
its holder to one vote.
As of September 30, 1998, in addition to the 21,372,369 shares of Old
Common Stock outstanding, the Company had (i) 522,647 shares of Old Common Stock
issuable upon conversion of the Company's Series A Preferred Stock, (ii) an
aggregate of 1,955,510 shares of Old Common Stock reserved for issuance upon
exercise of options granted under the Company's 1988 and 1992 Stock Option
Plans, of which options to purchase 1,458,361 shares of Old Common Stock are
outstanding , (iii) 125,000 shares of Old Common Stock reserved for issuance
pursuant to the Company's 1994 outside director stock purchase plan, and (iv)
552,953 shares of Old Common Stock issuable upon exercise of outstanding
warrants. The shares of Series A Preferred Stock and all outstanding options and
warrants include provisions for adjustment in the number of shares covered
thereby, and the conversion or exercise prices thereof, in the event of a
reverse stock split. Therefore, if the proposed Amendment is approved, on the
Effective Date, there will be 130,859 shares of New Common Stock issuable upon
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<PAGE>
the conversion of the Series A Preferred Stock and an aggregate of 658,366
shares of New Common Stock reserved for issuance upon exercise of outstanding
options and warrants. In addition, the Company may issue up to 429,558 shares of
Old Common Stock (based on the market price of the Common Stock on September 30,
1998) in partial payment of the right to manage physician practices. Following
the Effective Date, the Company will issue such number of shares of New Common
Stock in partial payment of the right to manage physician practices giving
effect to the Reverse Stock Split and a corresponding adjustment to the market
price of the New Common Stock.
The Reverse Stock Split would not affect any stockholder's proportionate
equity interest or proportional voting power in the Company except for those
stockholders who would receive cash in lieu of fractional shares as described
below. None of the rights currently accruing to holders of the Company's Common
Stock, Series A Preferred Stock or options or warrants to purchase Common Stock
will be affected by the Reverse Stock Split.
Although the Board of Directors believes as of the date of this Proxy
Statement that the Reverse Stock Split is advisable, the Reverse Stock Split may
be abandoned by the Board of Directors at any time before, during or after the
Special Meeting and prior to the Effective Date.
The Board of Directors may make any and all changes to the Amendment that
it deems necessary in order to file the Amendment with the Delaware Secretary of
State and give effect to the Reverse Stock Split.
BACKGROUND AND REASONS FOR THE REVERSE STOCK SPLIT
The principal reason for the Reverse Stock Split is for the Company's
Common Stock to continue to remain eligible for listing on the Nasdaq National
Market. In order to maintain listing on the Nasdaq National Market, the
Company's Common Stock must comply with a minimum bid price per share of $1.00.
On September 21, 1998, the Common Stock had been trading below $1.00 for 30
consecutive trading days. On such date, the Company was notified in writing that
the Company's Common Stock has failed to maintain a closing bid price of greater
than or equal to $1.00 per share as required by the Nasdaq National Market.
While the Company's Common Stock continues to remain listed, failure to maintain
a bid price in excess of $1.00 per share on an ongoing basis will result in the
future delisting of the Common Stock on the Nasdaq National Market, which might
adversely affect the trading in and liquidity of the Common Stock.
The reduction in the number of issued and outstanding shares of Common
Stock caused by the Reverse Stock Split is expected to increase the market price
of the Common Stock to a level above the current market trading price. While the
Board of Directors believes that the shares of Common Stock will trade at higher
prices than those which have prevailed over the recent weeks, there can be no
assurance that such increase in the trading price will occur or, if it does
occur, that it will equal or exceed the direct arithmetical result of the
Reverse Stock Split since there are numerous factors and contingencies which
could affect such price. There can be no assurance that the Company will comply
with the continued listing requirements of the Nasdaq National Market following
the Reverse Stock Split or that the reduced number of shares outstanding after
the Reverse Stock Split will not adversely affect the liquidity of the Common
Stock.
The Board of Directors also believes that the proposed Reverse Stock Split
will result in a broader market for the Common Stock than that which currently
exists. A variety of brokerage house policies and practices tend to discourage
individual brokers within those firms from dealing with lower priced stocks.
Some of those policies and practices pertain to the payment of broker's
commissions and to time consuming procedures that function to make the handling
of lower priced stock economically unattractive to brokers. In addition, the
structure of trading commissions also tends to have an adverse impact upon
holders of lower priced stock because the brokerage commission on a sale of
lower priced stock generally represents a higher percentage of the sales price
than the commission on a relatively higher priced issue. The Reverse Stock Split
may result in a price level for the Common Stock that will reduce, to some
extent, the effect of the above-referenced policies and practices of brokerage
firms and diminish the adverse impact of trading commissions on the market for
the Common Stock. The expected increased price level may also encourage interest
and trading in the Common Stock and possibly promote greater liquidity for the
Company's stockholders.
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<PAGE>
MECHANICS OF REVERSE STOCK SPLIT
If the Reverse Stock Split is approved by the requisite vote of the
Company's stockholders, the Amendment will be filed no later than November 18,
1998 and the Reverse Stock Split will thus be effected, unless abandoned by the
Board of Directors as described above. Upon filing of the Amendment, every four
(4) issued and outstanding shares of Old Common Stock will, immediately
following filing of the Amendment, be automatically and without any action on
the part of the stockholders converted into and reconstituted as one (1) share
of New Common Stock.
As soon as practical after the Effective Date, the Company will forward a
letter of transmittal to each holder of record of shares of Old Common Stock
outstanding as of the Effective Date. The letter of transmittal will set forth
instructions for the surrender of certificates representing shares of Old Common
Stock to American Stock Transfer & Trust Company, the Company's transfer agent
("Exchange Agent") in exchange for certificates representing the number of whole
shares of New Common Stock into which the shares of Old Common Stock have been
converted as a result of the Reverse Stock Split. CERTIFICATES SHOULD NOT BE
SENT TO THE COMPANY OR THE TRANSFER AGENT PRIOR TO RECEIPT OF SUCH LETTER OF
TRANSMITTAL FROM THE COMPANY.
Until a stockholder forwards a completed letter of transmittal together
with certificates representing his shares of Old Common Stock to the transfer
agent and receives a certificate representing shares of New Common Stock, such
stockholder's Old Common Stock shall be deemed equal to the number of whole
shares of New Common Stock to which each stockholder is entitled as a result of
the Reverse Stock Split.
No scrip or fractional share certificates evidencing shares of Common
Stock will be issued in connection with the Reverse Stock Split. If a
stockholder is entitled to a fractional interest of a share, he or she will
receive in lieu thereof, cash (without interest) in an amount equal to four (4)
times such fractional share of Common Stock multiplied by the last reported sale
price of the Common Stock on the Nasdaq National Market on the last business day
prior to the Effective Date or, if no such sale is made on such day, the average
of the closing bid and asked prices for such day on the Nasdaq National Market.
The Company will either deposit sufficient cash with the Exchange Agent or set
aside sufficient cash for the purchase of the fractional interests. Stockholders
are encouraged to surrender their Old Common Stock certificates to the Exchange
Agent for certificates evidencing whole shares of the New Common Stock and to
claim the sums, if any, due them for fractional interests as promptly as
possible following the Effective Date. No holder shall be entitled to dividends,
voting rights or any other rights as a stockholder with respect to any
fractional shares. No service charge will be payable by stockholders in
connection with the exchange of certificates or the issuance of cash for
fractional interests, all of which costs will be borne and paid by the Company.
FEDERAL INCOME TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT
The following is a summary of the material anticipated federal income tax
consequences of the Reverse Stock Split to stockholders of the Company. This
summary is based on the provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), the Treasury Department Regulations (the "Regulations")
issued pursuant thereto, and published rulings and court decisions in effect as
of the date hereof, all of which are subject to change. This summary does not
take into account possible changes in such laws or interpretations, including
amendments to the Code, applicable statutes, Regulations and proposed
Regulations or changes in judicial or administrative rulings, some of which may
have retroactive effect. No assurance can be given that any such changes will
not adversely affect the discussion of this summary.
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). In addition,
this summary does not address any consequence of the Reverse Stock Split under
any state, local or foreign tax laws. As a result, it is the responsibility of
each stockholder to obtain and rely on advice from his or her personal tax
advisor as to: (i) the effect on his or her personal tax situation of the
Reverse Stock Split, including the application and effect of state, local and
foreign income and other tax laws; (ii) the effect of possible future
legislation and Regulations; and (iii) the reporting of information required in
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<PAGE>
connection with the Reverse Stock Split on his or her own tax returns. It will
be the responsibility of each stockholder to prepare and file all appropriate
federal, state and local tax returns.
No ruling from the Internal Revenue Service nor opinion of counsel will be
sought or 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 TRANSACTION TO SUCH
STOCKHOLDER, INCLUDING THE APPLICATION AND EFFECT OF STATE, LOCAL AND FOREIGN
INCOME AND OTHER TAX LAWS.
The Company believes that the Reverse Stock Split will qualify as a
"recapitalization" under Section 368(a)(1)(E) of the Code. As a result, no gain
or loss will be recognized by the Company or its stockholders in connection with
the Reverse Stock Split. A stockholder of the Company who exchanges his or her
Old Common Stock solely for New Common Stock will recognize no gain or loss for
federal income tax purposes (except to the extent of any cash received in lieu
of fractional shares of New Common Stock). Cash payments in lieu of fractional
shares of New Common Stock should be treated as if the fractional shares were
issued to the stockholder and then redeemed by the Company for cash. A Company
stockholder receiving such payment should recognize gain or loss equal to the
difference, if any, between the amount of cash received and the stockholder's
basis in the fractional share (determined as provided below).
Such gain or loss will be capital gain or loss if the shares are held as a
capital asset at the time of the Reverse Stock Split, the payment of cash in
lieu of the fractional share is a mere mechanical rounding off of fractions and
not separately bargained for consideration, and the payment is "not essentially
equivalent to a dividend" with respect to the stockholder under the federal
income tax law. For this purpose, a payment is not essentially equivalent to a
dividend if it results in a "meaningful reduction" in the stockholder's
percentage interest in the Company, taking into account the constructive
ownership rules and redemptions of the fractional shares from all the
stockholders. The Internal Revenue Service has ruled publicly that any reduction
in the percentage interest of a small minority stockholder in a publicly-held
corporation who exercises no control over corporate affairs should constitute a
meaningful reduction; provided, however, if this ruling does not apply, the cash
payment for the fractional shares may be taxed as a dividend payment.
A stockholder's aggregate tax basis in his or her shares of New Common
Stock received from the Company will be the same as his or her aggregate tax
basis in the Old Common Stock exchanged therefor, less any portion of such basis
allocated to fractional shares for which a cash payment was received. The
holding period of the New Common Stock received by such stockholder will include
the period during which the Old Common Stock surrendered in exchange therefor
was held, provided all such Common Stock was held as a capital asset on the date
of the exchange.
ACCOUNTING EFFECTS OF THE REVERSE STOCK SPLIT
Following the Effective Date, the par value of the Company's Common
Stock will remain at $.01 per share. As a result, the Company's stated capital
will be reduced and capital in excess of par value (paid-in capital) increased
accordingly. Stockholders' equity will remain unchanged.
NO DISSENTERS' RIGHTS
Dissenting stockholders have no appraisal rights under Delaware law or
under the Company's Amended and Restated Certificate of Incorporation or By-laws
in connection with the Reverse Stock Split.
VOTE REQUIRED
The approval of the Amendment to the Company's Amended and Restated
Certificate of Incorporation effecting the Reverse Stock Split requires the
affirmative vote of a majority of the outstanding shares of the Common Stock and
Series A Preferred Stock entitled to vote thereon at the Special Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ABOVE PROPOSAL.
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<PAGE>
GENERAL
Company management does not know of any matters other than those stated in
this Proxy Statement which are to be presented for action at the meeting. If any
other matters should properly come before the meeting, it is intended that
proxies in the accompanying form will be voted on any such other matters in
accordance with the judgment of the persons voting such proxies. Discretionary
authority to vote on such matters is conferred by such proxies upon the persons
voting them.
The Company will bear the cost of preparing, printing, assembling and
mailing the proxy, Proxy Statement and other material which may be sent to
stockholders in connection with this solicitation. It is contemplated that
brokerage houses will forward the proxy materials to beneficial owners at the
request of the Company. In addition to the solicitation of proxies by use of the
mails, officers and regular employees of the Company may solicit by telephone
proxies without additional compensation. The Company does not expect to pay any
compensation for the solicitation of proxies.
By Order of the Board of Directors,
Gerardo Canet
Chairman of the Board, President and Chief Executive
Officer
Dated: October ____, 1998
-8-
<PAGE>
PROXY
INTEGRAMED AMERICA, INC.
One Manhattanville Road
Purchase, New York 10577
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Gerardo Canet or Eugene R. Curcio as proxy to
represent the undersigned at the Special Meeting of Stockholders to be held at
the Company's headquarters, One Manhattanville Road, Purchase, New York 10577 on
November 17, 1998 at 10:00 a.m. and at any adjournments thereof, and to vote the
shares of Common Stock and/or Preferred Stock the undersigned would be entitled
to vote if personally present:
1. APPROVAL OF AN AMENDMENT TO THE AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO EFFECT A ONE-FOR-FOUR REVERSE STOCK SPLIT OF THE COMPANY'S
COMMON STOCK, PAR VALUE $.01 PER SHARE.
o FOR o AGAINST o ABSTAIN
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE PROPOSAL.
IN THEIR DISCRETION, THE PROXY IS AUTHORIZED TO VOTE UPON SUCH MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF.
The shares of Common Stock and/or Preferred Stock represented by this proxy will
be voted as directed. If no contrary instruction is given, the shares of Common
Stock and/or Preferred Stock will be voted FOR the amendment to the Amended and
Restated Certificate of Incorporation to effect a one-for-four reverse stock
split.
Signature___________________ Date__________ Signature______________Date_________
Note: (Please date, sign as name appears above, and return promptly. If the
shares of Common Stock and/or Preferred Stock are registered in the names of two
or more persons, each should sign. When signing as Corporate Officer, Partner,
Executor, Administrator, Trustee or Guardian, please give full title. Please
note any changes in your address alongside the address as it appears in the
proxy.)
<PAGE>
EXHIBIT A
Certificate of Amendment
to
the Amended and Restated Certificate of Incorporation
of
IntegraMed America, Inc.
------------------
IntegraMed America, Inc., a corporation organized and existing
under the General Corporation Law of the State of Delaware (the "Corporation"),
hereby certifies as follows:
FIRST: The name of the corporation is IntegraMed America, Inc.
SECOND: The Amended and Restated Certificate of Incorporation
is hereby amended to delete paragraph A of Article IV in its entirety and
replace it with a new paragraph A, to read as follows:
Article IV
Capital Stock
A. The authorized capital stock of the Corporation shall
consist of fifty-five million (55,000,000) shares, consisting
of fifty million (50,000,000) shares of Common Stock, each
having a par value of $.01 (the "Common Stock"), and five
million (5,000,000) shares of Preferred Stock, each having a
par value of $1.00 per share. Upon the amendment of this
Article IV, every four (4) issued and outstanding shares of
Common Stock, $.01 par value per share ("Old Common Stock"),
shall be automatically and without any action on the part of
the stockholders converted into and reconstituted as one (1)
share of Common Stock, $.01 par value per share ("New Common
Stock"), subject to the treatment of fractional interests as
described below. Each holder of a certificate or certificates
which, immediately prior to this Certificate of Amendment of
the Amended and Restated Certificate of Incorporation becoming
effective pursuant to the General Corporation Law of the State
of Delaware (the "Effective Date"), represented outstanding
shares of the Old Common Stock shall be entitled to receive a
certificate for the number of shares of New Common Stock they
own by presenting their old certificate(s) to the Corporation's
transfer agent for cancellation and exchange. No scrip or
fractional certificates will be issued. Each holder of shares
shall be entitled to receive in lieu of fractional shares, a
cash payment from the Corporation determined by multiplying
four (4) times such fractional share of Common Stock by the
last reported sale price of the Common Stock on the Nasdaq
National Market on the last business day prior to the Effective
Date or, if no such sale is made on such day, the average of
the closing bid and asked prices for such day on the Nasdaq
National Market.
<PAGE>
THIRD: This amendment has been duly adopted in accordance
with the provisions of Section 242 of the General Corporation Law of the State
of Delaware.
IN WITNESS WHEREOF, the Corporation has caused this Certificate
to be subscribed by its President and Chief Executive Officer, this __th day of
September, 1998.
INTEGRAMED AMERICA, INC.
---------------------------
Gerardo Canet, President and
Chief Executive Officer
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