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:
[ ] PRELIMINARY PROXY STATEMENT
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14A-6(E)(2))
[X] DEFINITIVE PROXY STATEMENT
[ ] DEFINITIVE ADDITIONAL MATERIALS
[ ] SOLICITING MATERIAL PURSUANT TO SS. 240.14A-11(C) OR SS. 240.14A-12
LASERMEDICS, INC.
(Name of Registrant as Specified In Its Charter)
LASERMEDICS, INC.
(Name of Person 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:
NOT APPLICABLE
2) Aggregate number of securities to which transaction applies:
NOT APPLICABLE
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: NOT APPLICABLE
4) Proposed maximum aggregate value of transaction: NOT APPLICABLE
5) Total fee paid: NOT APPLICABLE
[ ] 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: NOT APPLICABLE
2) Form, Schedule or Registration Statement No.: NOT APPLICABLE
3) Filing Party: NOT APPLICABLE
4) Date Filed: NOT APPLICABLE
<PAGE>
LASERMEDICS, INC.
120 INDUSTRIAL BOULEVARD
SUGAR LAND, TEXAS 77478
May 5, 1997
Dear Shareholder:
You are cordially invited to attend the annual meeting of shareholders
(the "Annual Meeting") of Lasermedics, Inc. (the "Company") to be held on
Friday, June 6, 1997 at 10:00 a.m., Houston, Texas time, at the Ritz Carlton
Hotel-Houston, located at 1919 Briar Oaks Lane, Houston, Texas 77027.
At the Annual Meeting you will be asked to (i) elect six directors of
the Company, and (ii) approve an amendment to the Company's Articles of
Incorporation (the "Charter Amendment") which would change the name of the
Company to Henley Healthcare, Inc.
In view of the importance of the actions to be taken at the Annual
Meeting, you are urged to read the accompanying Proxy Statement carefully, and
regardless of the number of shares you own, we request that you complete, sign,
date and return the enclosed Proxy Card promptly in the accompanying prepaid
envelope. You may, of course, attend the Annual Meeting and vote in person, even
if you have previously returned your Proxy Card. The Company's Board of
Directors believes that the election of each of the director-nominees and the
approval of the Charter Amendment, are both in the best interest of the Company
and its shareholders and therefore strongly recommends that you vote FOR each of
the directors nominated by the Company and FOR approval of the Charter
Amendment.
Chike J. Ogboenyiya,
CORPORATE SECRETARY
<PAGE>
LASERMEDICS, INC.
120 INDUSTRIAL BOULEVARD
SUGAR LAND, TEXAS 77478
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 6, 1997
Notice is hereby given that the annual meeting (the "Annual Meeting")
of the shareholders of Lasermedics, Inc., a Texas corporation (the "Company"),
will be held on Friday, June 6, 1997 at 10:00 a.m., Houston, Texas time, at the
Ritz Carlton Hotel-Houston, located at 1919 Briar Oaks Lane, Houston, Texas
77027 for the following purposes:
1. To elect a board of six directors;
2. To consider and to act on a proposal to amend the Company's
Articles of Incorporation to change the name of the Company to
Henley Healthcare, Inc. (the "Charter Amendment"); and
5. To transact such other business as may properly come before the
Annual Meeting.
A record of the shareholders was taken at the close of business on
April 21, 1997, and only those shareholders of record on that date will be
entitled to notice of and to vote at the Annual Meeting. A list of shareholders
will be available commencing May 27, 1997, and may be inspected prior to the
Annual Meeting during normal business hours at the offices of the Company
located at 120 Industrial Boulevard, Sugar Land, Texas 77478.
Your participation in the Company's affairs is important. To ensure
your representation, if you do not expect to be present at the Annual Meeting,
PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT TO THE COMPANY PROMPTLY.
An addressed stamped envelope has been provided for your convenience.
By Order of the Board of Directors
Chike J. Ogboenyiya,
CORPORATE SECRETARY
May 5, 1997
<PAGE>
LASERMEDICS, INC.
120 INDUSTRIAL BOULEVARD
SUGAR LAND, TEXAS 77478
PROXY STATEMENT
REGARDING
THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
JUNE 6, 1997
-----------------------------------------------------
This Proxy Statement is being mailed to shareholders on or about May 5,
1997, in connection with the solicitation by the Board of Directors of
Lasermedics, Inc., a Texas corporation (the "Company"), of proxies to be voted
at the annual meeting of the Company's shareholders (the "Annual Meeting") to be
held on Friday, June 6, 1997 at 10:00 a.m., Houston, Texas time, at the Ritz
Carlton Hotel-Houston located at 1919 Briar Oaks Lane, Houston, Texas 77027, and
at any adjournment thereof, for the purposes set forth in the accompanying
notice.
Because many shareholders are unable to attend the Annual Meeting, the
Board of Directors solicits proxies to ensure that each shareholder has an
opportunity to vote on all matters scheduled to come before the Annual Meeting.
Shareholders are urged to carefully read the material in this Proxy Statement
and register their votes by marking the appropriate boxes on the enclosed proxy
card and to sign, date and return the proxy card in the enclosed addressed
stamped envelope. Proxies will be voted in accordance with the directions
specified thereon and otherwise in accordance with the judgment of the persons
designated as the holders of proxies.
Shares represented by proxies that reflect abstentions will be treated as
shares that are present and entitled to vote for purposes of determining the
presence of a quorum and the outcome of any matter submitted to the shareholders
for a vote. Abstentions, however, do not constitute a vote "for" or "against"
any matter, and will be disregarded in the calculation of a plurality or of
"votes cast." Shares referred to as "broker non-votes" (i.e., shares held by
brokers or nominees as to which instructions have not been received from the
beneficial owners or persons entitled to vote that the broker or nominee does
not have discretionary power to vote on a particular matter) will be treated as
shares that are present and entitled to vote for purposes of determining the
presence of a quorum. However, for purposes of determining the outcome of any
matter as to which the broker has physically indicated on the proxy that it does
not have discretionary authority to vote, those shares will be treated as not
present and not entitled to vote with respect to that matter (even though those
shares are considered entitled to vote for quorum purposes and may be entitled
to vote on other matters).
Any proxy on which no direction is specified will be voted: (1) FOR the
election of all six nominees for director named herein, (2) FOR the approval of
the proposed amendment to the Company's Articles of Incorporation changing the
Company's name to Henley Healthcare, Inc. (the "Charter Amendment"), and (3) in
the discretion of the persons named on the proxy cards, on any other matter
which may properly come before the Annual Meeting. Management of the Company
does not expect that any matters other than those referred to in this proxy
statement will be presented for action at the Annual Meeting. A shareholder may
revoke a proxy by: (i) delivering to the Company written notice of revocation,
(ii) delivering to the Company a signed proxy signed on a later date or (iii)
appearing at the Annual Meeting and voting in person.
May 5, 1997
<PAGE>
TABLE OF CONTENTS
PAGE
OUTSTANDING VOTING SECURITIES................................................3
ELECTION OF DIRECTORS........................................................3
Nominees...............................................................3
Activity, Structure and Compensation of the
Board of Directors and Certain Committees............................4
Audit Committee...................................................4
Compensation Committee............................................5
Compensation of Directors.........................................5
Voting Agreements Regarding Election..............................6
Vote Required for Election........................................6
APPROVAL OF PROPOSED CHARTER AMENDMENT.......................................6
Vote Required for Approval.............................................6
OTHER INFORMATION............................................................7
Security Ownership of Certain Beneficial Owners
and Management.......................................................7
Executive Officers.....................................................8
Executive Compensation.................................................8
Certain Relationships and Related Transactions.........................9
Auditors..............................................................10
Compliance with Section 16(a) of the Exchange Act.....................10
Miscellaneous Matters.................................................11
2
<PAGE>
OUTSTANDING VOTING SECURITIES
As of April 21, 1997, the record date for the determination of
shareholders entitled to vote at the Annual Meeting (the "Record Date"), there
were issued and outstanding 2,793,556 shares of the common stock, par value $.01
per share (the "Common Stock"), each of which is entitled to one vote on all
matters properly brought before the Annual Meeting. Holders of a majority of the
shares of Common Stock entitled to vote must be present, in person or by proxy
at the Annual Meeting, to constitute a quorum for the transaction of business.
ELECTION OF DIRECTORS
At the Annual Meeting, six directors are to be elected, each director to
hold office until the next annual meeting of shareholders or until his successor
is duly elected and qualified. The persons named in the accompanying proxy (the
"Nominees") have been nominated by the Board of Directors, and have previously
served as directors of the Company. If any Nominee should become unavailable for
election, the proxy may be voted for a substitute nominee selected by the
persons named in the proxy or the Board of Directors may be reduced accordingly.
The Board of Directors is not aware of any circumstances likely to render any
Nominee unavailable.
NOMINEES
Certain information regarding each of the Nominees is set forth below:
DIRECTOR
NAME AGE POSITION(S) HELD SINCE
---- --- ---------------- --------
Michael M. Barbour................ 52 President, Chief Executive 1991
Officer and Director
Chadwick F. Smith, M.D............ 63 Medical Director, Chairman 1991
of the Board and Director
Dan D. Sudduth.................... 55 Executive Vice President, 1996
Chief Financial Officer
and Director
Pedro A. Rubio, M.D., Ph.D. (2)... 52 Director 1996
Kenneth W. Davidson (1)........... 49 Director 1996
Ernest J. Henley, Ph.D. (2)....... 70 Director 1996
- ---------------
(1) Member, Audit Committee of the Board of Directors (the "Audit Committee")
(2) Member, Compensation Committee of the Board of Directors (the "Compensation
Committee")
MICHAEL M. BARBOUR has been President, Chief Executive Officer and
Director of the Company since May 1991. He has over 13 years experience in the
field of laser products. Prior to forming Lasermedics, he was President of
Medical Training Centers of America (formerly The Houston Laser Institute) from
January 1987 to April 1991, which he founded in order to train and inform
doctors in the medical and surgical use of lasers. From April 1984 to January
1987, he was President of Surgimedics, a Houston, Texas, manufacturer and
distributor of laser accessory products. Mr. Barbour graduated from the
University of Houston in 1967 with a B.B.A. in marketing.
DAN D. SUDDUTH joined the Company as Executive Vice President and Chief
Financial Officer in February 1997. He has been a Director of the Company since
January 1996. Mr. Sudduth was Chief Financial Officer for Mezzanine Telecom,
Inc., a Houston-based telecommunications company, from 1994 to January 1997 and
currently serves as a Director. He is also a Director for CQI Solutions, Inc., a
medical computer software company in New Braunfels, Texas. During 1995 and 1996,
Mr. Sudduth was President and Director of AMC Home Healthcare, Inc., a
respiratory therapy company in Houston, Chairman of Mezzanine Financial
Relations, Inc., a merchant banking firm in Houston, and Chief Financial Officer
and Director of Creative Communications International, Inc., a Houston
telecommunications company. From 1992 to 1994, Mr. Sudduth served as Chairman
and Chief Executive Officer of Heart Labs of America, Inc. From
3
<PAGE>
1988 to 1992, he was President and Chief Financial Officer of American Biomed,
Inc. Mr. Sudduth received a B.B.A. in 1964 from Lamar University.
CHADWICK F. SMITH, M.D. has been a Director of the Company since May 1991
and Chairman of the Board of Directors since June 1993. He is also a Consultant
to the Company. See "Certain Relationships and Related Transactions." Dr. Smith
is a Clinical Professor of Orthopedic Surgery at the University of Southern
California School of Medicine, a position he has held since 1981. He has also
been a member of the Medical Staff of Orthopedic Hospital, Los Angeles,
California, since 1966. Dr. Smith graduated with a B.A. from Southern Methodist
University in 1954, graduated from the University of Texas medical school in
1958, and has been a diplomate of the American Board of Orthopedic Surgery since
1968.
PEDRO A. RUBIO, M.D., PH.D. has been a Director of the Company since
January 1996. He is currently a Clinical Associate Professor of Surgery at the
University of Texas Health Science Center in Houston. He was Director of
Education of the Laser Training Institute of Houston, from November 1993 until
January 1996. He served as World President of the International College of
Surgeons in Chicago in 1995, and was Chairman of the Department of Surgery at
the Columbia/HCA Medical Center Hospital in Houston from 1976 to 1994, when he
became Chairman Emeritus. Dr. Rubio holds the degrees of Bachelor of Science,
Master of Science in Surgical Technology, Doctor of Philosophy in Biomedical
Technology and Doctor of Medicine and Surgery. Dr. Rubio is a Diplomate of the
American Boards of Surgery, Laser Surgery, Abdominal Surgery, Forensic Medicine,
Quality Assurance and Utilization Review, Forensic Examiners and Pain
Management.
KENNETH W. DAVIDSON has been a Director of the Company since April 1996.
He is President, Chief Executive Officer and Chairman of the Board of Directors
of Maxxim Medical, Inc. ("Maxxim") since November 1986, and a Director since
1982. Prior to that time, Mr. Davidson was the Corporate Director of Business
Development at Intermedics, which is principally a manufacturer of implantable
devices such as pacemakers. Mr. Davidson is also a Director of Encore
Orthopedics, Inc., a designer and manufacturer of implantable orthopedic
devices.
ERNEST J. HENLEY, PH.D. has been a Director of the Company since April
1996, and is also a consultant to the Company. He has been a Director of Maxxim
since 1976. See "Certain Relationships and Related Transactions." Dr. Henley's
principal employment for more than fifteen years has been as a Professor of
Chemical Engineering at the University of Houston.
ACTIVITY, STRUCTURE AND COMPENSATION OF THE BOARD OF DIRECTORS AND CERTAIN
COMMITTEES
The Company's operations are managed under the broad supervision of the
Board of Directors, which has responsibility for the establishment and
implementation of the Company's general operating philosophy, objectives, goals
and policies. During 1996, the Board of Directors was comprised of the six
Nominees listed above and convened on 8 regularly scheduled meetings and 2
specially scheduled meetings.
AUDIT COMMITTEE. The Audit Committee was formed in May 1996. While Mr.
Davidson is currently the only member of the Audit Committee, the Board of
Directors intends to nominate an additional member to the committee at the first
meeting of the Board of Directors immediately following the Annual Meeting. The
Audit Committee assists the Board of Directors in fulfilling its
responsibilities to the Company's shareholders and other matters relating to the
corporate accounting and reporting practices of the Company and the quality and
integrity of the financial reports of the Company. The Audit Committee
recommends the engagement or discharge of the Company's independent auditors,
reviews the plan, scope and timing of audits with the independent auditors,
reviews the auditors' fees and, after completion of the audit, reviews the
auditors' report with management and the independent auditors. The Audit
Committee is charged with satisfying the Board of Directors that the activities
of the Company's independent auditors and the internal control procedures are
reasonably designed to assure sound accounting procedures, adequate reserves,
the safekeeping of the Company's assets and properties and the proper control of
income and expenditures. The Audit Committee also reviews the Company's Annual
Report to Shareholders before its release, oversees the Company's policies on
business integrity and ethics, conflicts of interest and sensitive payments
programs and receives reports from the internal audit department, which reports
directly to it as well as to management. The Audit Committee also performs a
number of other review functions related to auditing the financial statements
and internal controls.
4
<PAGE>
COMPENSATION COMMITTEE. The Compensation Committee was formed in May 1996.
The current members of the Compensation Committee are Drs. Rubio and Henley. The
Compensation Committee reviews and determines the salaries for senior executive
officers and the key officers and employees who participate in various incentive
compensation plans. The Compensation Committee approves the grant of stock
options, including the number of shares subject to and the exercise price of,
each stock option granted, in accordance with the Company's various stock option
plans. The Compensation Committee is also responsible for reviewing significant
personnel compensation policies and benefit programs and major changes thereto.
The Compensation Committee reviews and recommends to the Board of Directors the
direct and indirect compensation and employee benefits of the elected officers
of the Company, administers any incentive plans and bonus plans, and reviews the
Company's policies relating to the compensation of senior management and,
generally, other employees. In addition, the Compensation Committee reviews
management's long-range planning for executive development and succession,
establishes and periodically reviews policies on management perquisites, and
performs certain other review functions relating to management compensation and
employee relations policies.
COMPENSATION OF DIRECTORS. Effective January 15, 1996, the Board of
Directors adopted the following plans which were approved by the Company's
shareholders in July 1996: (i) the 1996 Incentive Stock Option Plan (the
"Incentive Plan") under which the Company can issue up to 1.2 million shares of
the Company's Common Stock to eligible officers, employees, and consultants of
the Company, including employee directors ("Employee Directors"), and (ii) the
1996 Non-Employee Director Stock Option Plan (the "Director Plan") under which
the Company can issue up 250,000 shares of Common Stock to its outside
directors.
Employee Directors are eligible to participate in the Incentive Plan.
Under the Incentive Plan, the Compensation Committee can grant incentive awards
of options, restricted stock, phantom stock, and stock and cash bonuses
(collectively, "Incentive Awards") to Employee Directors. The Compensation
Committee determines whether the Employee Directors receive Incentive Awards and
the amount and type of such Incentive Awards. There were no Incentive Awards
under the Incentive Plan granted to Employee Directors in 1996.
The Director Plan entitles each newly-elected director (a "New Director")
who is neither (i) an existing director of the Company (an "Existing Director"),
(ii) an employee of the Company, nor (iii) appointed or elected to the board in
connection with or as a result of the completion of a financing or acquisition
transaction in which the appointment or election of such person is a condition
to the obligation of any party to complete the transaction, to receive a
one-time option to purchase up to 25,000 shares of Common Stock on the date of
such election (the Existing Directors and the New Directors are sometimes
collectively referred to herein as the "Eligible Directors"). Further, the
Director Plan also entitles each Eligible Director to receive an option to
purchase 10,000 shares of Common Stock on each date he or she is reelected to
serve as a member of the Board of Directors. All options granted under the
Director Plan will constitute non-qualified stock options ("NQO").
During the last fiscal year, there were four directors eligible to
participate in the Director Plan. They were Messrs. Sudduth and Davidson, and
Drs. Rubio and Henley. In connection with their election to the Board of
Directors in January 1996, Mr. Sudduth and Dr. Rubio were each granted a stock
option under the Director Plan to purchase 25,000 shares of the Company's common
stock at a price of $5.50 per share. Also, in connection with his election to
the Board of Directors concurrent with the closing of the Henley acquisition in
April 1996 as discussed below, Dr. Henley was granted an option under the
Director Plan to purchase 25,000 shares of the Company's Common Stock at a price
of $7.75 per share. Additionally, in connection with their re-election to the
Board of Directors in July 1996, Drs. Henley and Rubio and Messrs. Sudduth and
Davidson were each granted a stock option under the Director Plan to purchase
10,000 shares (for an aggregate of 40,000 shares) of the Company's Common Stock
at a price of $6.125 per share.
The Director Plan also provides that at the discretion of the Board of
Directors, the Company may pay a cash fee to non-employee directors from time to
time for serving on, and for attendance at meetings of, the Board of Directors
or any committee thereof (as such fees are set by the Board of Directors from
time to time). Employee Directors do not receive additional compensation for
service on the Board of Directors or its committees. During the year ended
December 31, 1996, the Company paid Drs. Henley and Rubio and Messrs. Sudduth
and Davidson $500 per person for attendance at each meeting of the Board of
Directors.
5
<PAGE>
VOTING AGREEMENTS REGARDING ELECTION
Under the terms of that certain asset purchase agreement between Maxxim
and the Company, dated April 30, 1996, whereby the Company acquired certain
assets (and assumed certain liabilities) of the Henley Healthcare Division of
Maxxim ("Henley"), Dr. Smith, Mr. Barbour and Maxxim entered into a voting
agreement (the "Voting Agreement") by which Dr. Smith and Mr. Barbour agreed to
vote their shares of Common Stock for a Nominee of Maxxim until certain
conditions specified therein are met. Pursuant to the Voting Agreement, Mr.
Davidson was named as a Director of the Company effective May 1, 1996, and is
nominated for re-election at the Annual Meeting.
VOTE REQUIRED FOR ELECTION
The six Nominees who receive the greatest number of votes cast by the
holders of Common Stock entitled to vote and present, in person or by proxy, at
the Annual Meeting shall be the duly elected Directors of the Company.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ALL SIX NOMINEES TO THE
COMPANY'S BOARD OF DIRECTORS.
APPROVAL OF PROPOSED CHARTER AMENDMENT
The Board of Directors has adopted, and proposes that the shareholders of
the Company approve, the Charter Amendment, which would change the name of the
Company to Henley Healthcare, Inc. Since the acquisition of Henley, the Company
has operated that portion of its business under the Henley Healthcare name, and
has determined that the name has significant goodwill in the medical industry.
The Board of Directors also feels that the new name will more accurately portray
the healthcare focus of the Company, and will remove the emphasis on the
development of lasers which, while still an important aspect of the Company's
business, comprises only a portion of the Company's activities in the healthcare
industry.
If the Charter Amendment is approved by the requisite vote, the Company
will file Articles of Amendment to the Articles of Incorporation with the Texas
Secretary of State promptly following the conclusion of the Annual Meeting. The
proposed Charter Amendment will become effective on the date of filing. A copy
of the proposed Charter Amendment is attached hereto as EXHIBIT A and
incorporated herein by reference.
VOTE REQUIRED FOR APPROVAL
The affirmative vote of the holders of two-thirds of the outstanding
shares of Common Stock is required to approve the Charter Amendment.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE CHARTER
AMENDMENT.
6
<PAGE>
OTHER INFORMATION
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of the Company's Common Stock at the Record Date by (i)
each shareholder known by the Company to be the beneficial owner of more than
five percent of the outstanding shares of Common Stock, (ii) each Director and
Nominee, (iii) each executive officer named in the Summary Compensation Table
(see "Executive Compensation" below) and (iv) all Directors and executive
officers as a group:
NAME AND ADDRESS AMOUNT AND NATURE OF
OF BENEFICIAL OWNER (1) BENEFICIAL OWNERSHIP (2) PERCENT OF CLASS
- ----------------------- ------------------------ ----------------
Ernest J. Henley, Ph.D................ 2,368,333(3) 45.88%
Kenneth W. Davidson................... 2,343,333(3) 45.62%
104 Industrial Boulevard
Sugar Land, Texas 77478
Maxxim Medical, Inc................... 2,333,333(4) 45.51%
104 Industrial Boulevard
Sugar Land, Texas 77478
Chadwick F. Smith, M.D................ 420,666(5) 13.94%
1127 Wilshire Blvd.
Los Angeles, California 90017
Michael M. Barbour.................... 411,748(5) 13.64%
Pedro A. Rubio, M.D., Ph.D............ 105,003(6) 3.67%
Dan D. Sudduth........................ 60,000(7) 2.10%
All Executive Officers and
Directors as a Group (8 persons)...... 3,459,063(8) 59.62%
- ---------------
(1) Unless otherwise specified, the address of each beneficial owner is c/o
Lasermedics, Inc. 120 Industrial Boulevard, Sugar Land, Texas 77478.
(2) Except as otherwise indicated, all shares are beneficially owned, and the
sole investment and voting power is held, by the person named. This table
is based on information supplied by the officers, directors and principal
shareholders and reporting forms, if any, filed with the Securities and
Exchange Commission on behalf of such persons. A person is deemed to
beneficially own shares of common stock underlying options, warrants or
other convertible securities if the stock can be acquired by such person
within sixty days of the date hereof.
(3) Includes 2,333,333 shares issuable upon the conversion of the Company's
convertible subordinated promissory note in the initial principal amount
of $7 million issued to Maxxim (the "Maxxim Note"), as to which Dr. Henley
and Mr. Davidson , who are directors of both the Company and Maxxim, may
be deemed the beneficial owners by virtue of their affiliation with
Maxxim. See "Certain Relationships and Related Transactions." The
additional 35,000 and 10,000 shares listed for each of Dr. Henley and Mr.
Davidson, respectively, consist entirely of warrants and/or options
exercisable as of the date hereof.
(4) Maxxim is the holder of the Maxxim Note, which is convertible into
2,333,333 shares of Common Stock. See "Certain Relationships and Related
Transactions."
(5) Includes 225,000 shares issuable upon exercise of currently exercisable
options.
(6) Includes 69,508 shares issuable upon exercise of currently exercisable
options.
(7) Consists entirely of shares issuable upon exercise of currently
exercisable options or warrants.
(8) In addition to the 2,333,333 shares issuable upon conversion of the Maxxim
Note and the currently exercisable options and warrants listed above, this
amount includes (i) 500 shares and 50,000 currently exercisable options
7
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owned by Chike Ogboenyiya, the Company's Vice President-Finance and
Secretary, and (ii) 32,813 shares owned by Michael J. Houska, the
Company's Vice President-Sales.
EXECUTIVE OFFICERS
The executive officers of the Company serve at the pleasure of the Board
of Directors and are subject to annual appointment by the Board of Directors at
its first meeting following the Annual Meeting. All of the Company's executive
officers are listed in the following table, and certain information concerning
those officers who are not also members of the Board of Directors follows the
table:
NAME AGE POSITION
---- --- --------
Michael M. Barbour........ 52 Director, President and Chief Executive Officer
Dan D. Sudduth............ 55 Director, Executive Vice President and
Chief Financial Officer
Chike J. Ogboenyiya....... 45 Vice President-Finance and Secretary
Michael J. Houska......... 37 Vice President-Sales
CHIKE J. OGBOENYIYA has been Vice President-Finance of the Company since
January 1994 and Secretary since August 1994. He has over 20 years of extensive
industry experience in accounting, corporate finance and business management.
From 1990 to 1993, he was president and owner of a small accounting firm which
offered business consulting and financial services to various clients. Prior to
that time, he was a Director and Chief Financial Officer for Kaulimax
International Corporation, a privately-held exporter of apparel located in
Houston, Texas, from 1984 to 1990. Mr. Ogboenyiya is a Certified Public
Accountant, graduated with an M.S. from the University of Houston in 1979, and
graduated cum laude from Texas Southern University in 1977 with a B.B.A. in
Accounting.
MICHAEL J. HOUSKA has been Vice President-Sales of the Company since May
1996. He has over 13 years of experience in the medical devices industry. Mr.
Houska is a Director of Love Inc./Love for Children, an affiliate of World
Vision. From 1987 to 1996, Mr. Houska was a divisional Vice President of Sales
and Marketing for Maxxim.
Mr. Houska holds a B.A. in business management from Hiram College in Ohio.
EXECUTIVE COMPENSATION
SUMMARY OF COMPENSATION. The following table provides information
concerning compensation paid or accrued during the fiscal years ended December
31, 1996, 1995 and 1994 to the Company's Chief Executive Officer, Michael M.
Barbour. During 1996, 1995 and 1994, no other executive officers received
compensation which exceeded $100,000:
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------ ------------------------ -------
SECURITIES
UNDERLYING ALL
OTHER ANNUAL RESTRICTED OPTIONS/ LTIP OTHER
NAME AND POSITION YEAR SALARY BONUS COMPENSATION STOCK AWARDS SARS (#) PAYOUTS COMPENSATION
- ----------------- ---- ------ ----- ------------ ------------ ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1996 $171,657 -- -- -- -- -- --
Michael M. Barbour 1995 $110,000 -- $9,000 -- -- -- --
CEO 1994 $110,000 -- $9,000 -- 225,000 -- --
</TABLE>
8
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AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR ENDED
OPTION VALUES. The following table provides certain information with respect to
options exercised during the fiscal year ended December 31, 1996 by the
Company's Chief Executive Officer:
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
SHARES OPTIONS/SARS OPTIONS/SARS AT
ACQUIRED ON VALUE AT FISCAL YEAR END (#) FISCAL YEAR END($)(1)
NAME EXERCISE REALIZED DECEMBER 31, 1994 REALIZED
---- ----------- -------- --------------------------- --------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------ ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Michael M. Barbour... -- -- 225,000 -- $ 498,750 --
</TABLE>
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(1) Calculated by multiplying the number of shares underlying outstanding
in-the-money options by the difference between the last sales price of the
Common Stock on December 31, 1996 ($6.05 per share) and the exercise
price, which ranges between $3.00 and $4.50 per share. Options are
in-the-money if the fair market value of the underlying Common Stock
exceeds the exercise price of the option.
EMPLOYMENT CONTRACTS. In November 1996, the Company entered into an
agreement with Michael M. Barbour, effective as of May 1, 1996, employing him as
its Chief Executive Officer at a base annual salary of $160,000. The agreement
also provides for an annual bonus amount payable to Mr. Barbour based on a
specific formula provided in the agreement. The agreement terminates on December
31, 1998.
Effective November 12, 1996, the Company entered into an agreement with
Michael J. Houska employing him as its Vice President-Sales at a base annual
salary of $120,000. The agreement also provides for a monthly sales commission
of $6,700 payable to Mr. Houska based on a specific formula provided in the
agreement. The agreement terminates on November 11, 1998.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During January 1992, the Company entered into a five-year consulting
agreement with Chadwick F. Smith, M.D., one of its Directors. The agreement
provided for a monthly fee of $1,500 commencing in July 1992. During 1993, the
agreement was amended to provide a monthly fee of $5,000 commencing in June
1993. The agreement terminated in April 1996, and a new agreement was entered
into with Dr. Smith effective May 1, 1996. Dr. Smith's new consulting agreements
includes annual compensation of $90,000 and terminates on December 31, 1998.
During 1993, the Company entered into an employment agreement with Stephen
Barbour, who is the brother of the President of the Company, whereby Mr. Stephen
Barbour would receive, as part of his employment contract, a salary of $60,000
per year, 15,000 shares of the Common Stock and commissions of 15% on the
monthly gross profit of the Company's training division. The agreement
terminated in 1996.
In August 1995, the Company entered into an agreement with Mezzanine
Financial Relations, Inc., a financial relations company ("Mezzanine"), to
assist the Company in the evaluation of, and formulation of terms for certain
companies identified in the Company's strategic acquisition plan. Mr. Sudduth,
Executive Vice President, Chief Financial Officer and a Director of the Company,
was Chairman of the Board and a shareholder of Mezzanine. Pursuant to the
agreement, the Company paid Mezzanine a cash fee of $115,000 concurrent with the
closing of the Henley acquisition, which is discussed below. Additionally,
pursuant to the agreement, the Company issued to Mezzanine a four-year warrant
to purchase 25,000 shares of the Company's common stock at a price of $6.75 per
share, which was the market price of the Company's Common Stock on the date of
the grant. This warrant is exercisable from February 16, 1996 through August 16,
1999. In May 1996, the Company entered into an additional agreement with
Mezzanine pursuant to which Mezzanine agreed to provide financial consulting
services with regard to potential mergers and acquisitions in consideration for
a monthly fee of $10,000. The agreement terminated on January 31, 1997.
9
<PAGE>
On April 30, 1996, the Company entered into an agreement with Maxxim,
whereby the Company purchased certain assets (and assumed certain liabilities)
associated with Henley, a division of Maxxim at that time, for a purchase price
of approximately $13.5 million. The purchase price was paid by the issuance of
the Company's convertible subordinated promissory note in the principal amount
of $7 million (the "Maxxim Note"), with the balance of the purchase price paid
in cash. Mr. Davidson and Dr. Henley are currently employed by Maxxim, with Mr.
Davidson serving in the capacities of Chairman of the Board, Chief Executive
Officer and President and Dr. Henley serving as a Director and consultant. See
"Election of Directors--Voting Agreements Regarding Election." Dr. Henley's
consulting agreement, which was entered into between Dr. Henley and Maxxim in
1987, was acquired in the transaction with Maxxim. The agreement includes a
monthly consulting fee in the amount of $5,833 and terminates on October 31,
1997.
In May and July 1996, the Company paid to Dr. Rubio fees aggregating
$25,000 and issued 33,333 shares of Common Stock and 33,333 warrants to purchase
shares of Common Stock at a price of $6.00 per share for his services in
connection with the Company's Pre-Market Approval application submission to the
U.S. Food and Drug Administration.
In November 1996, the Company entered into an agreement with MJH Medical
Equipment, Inc. ("MJH"), whereby the Company purchased substantially all of the
assets (and assumed certain liabilities) of MJH for a purchase price of
approximately $400,000. The purchase price was paid by the issuance of the
Company's Common Stock with an estimated market value of $250,000 and promissory
note in the principal amount of approximately $120,000, with the balance of the
purchase price paid in cash. Michael J. Houska, now the Company's Vice-President
Sales, was the owner and sole stockholder of MJH. Mr. Houska entered into a
two-year employment agreement with the Company with a base salary of $120,000
and monthly bonuses. The Company leases approximately 15,000 square feet of
warehouse and distribution space in Akron, Ohio, for a monthly rental of
approximately $3,900. Mr. Houska is one of the owners of the leased facility.
AUDITORS
Goldstein Golub Kessler & Company, P.C., certified public accountants
("GGK"), have served as the independent auditors of the Company since October
1994. It is not proposed that any formal action to be taken at the Annual
Meeting with respect to the continued employment of GGK, inasmuch as no such
action is legally required. Representatives of GGK plan to attend the Annual
Meeting and will be available to answer appropriate questions.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires a company's directors and
executive officers, and persons who own more than 10% of the equity securities
of the Company to file initial reports of ownership and reports of changes in
ownership of the Common Stock with the Securities and Exchange Commission (the
"SEC"). Officers, directors and greater than 10% shareholders are required to
furnish the Company with copies of all Section 16(a) reports they file.
Based solely on a review of the forms the Company has received or
prepared, the Company believes that during the year ended December 31, 1996, all
filing requirements applicable to the Company's directors, officers and greater
than 10% shareholders were met except Michael J. Houska failed to file a Form 4
on a timely basis in connection with the shares of Common Stock he acquired in
the asset purchase transaction between MJH and the Company.
10
<PAGE>
MISCELLANEOUS MATTERS
The annual report on Form 10-KSB/A covering the fiscal year ended December
31, 1996 accompanies this Proxy Statement. Any shareholder proposals to be
included in the Board of Directors' solicitation of proxies for the 1998 Annual
Meeting of Shareholders must be received by the Company at its principal
executive offices, located at 120 Industrial Boulevard, Sugar Land, Texas 77478,
no later than February 9, 1998. The cost of soliciting proxies in the
accompanying form will be borne by the Company. In addition to solicitations by
mail, a number of regular employees of the Company may, if necessary to assure
the presence of a quorum, solicit proxies in person or by telephone. The persons
designated to vote shares covered by the Board of Directors' proxies intend to
exercise their judgment in voting such shares on other matters that may properly
come before the Annual Meeting.
By Order of the Board of Directors
Chike J. Ogboenyiya,
CORPORATE SECRETARY
11
<PAGE>
ARTICLES OF AMENDMENT EXHIBIT A
TO
ARTICLES OF INCORPORATION
OF
LASERMEDICS, INC.
Pursuant to the provisions of Article 4.04 of the Texas Business
Corporation Act, Lasermedics, Inc. hereby adopts these Articles of Amendment to
its Articles of Incorporation:
ARTICLE ONE
The name of the corporation is Lasermedics, Inc. (the "Corporation").
ARTICLE TWO
The following amendments to the Articles of Incorporation of the
Corporation were adopted by the shareholders of the Corporation on June 6, 1997
at the Corporation's Annual Meeting of Shareholders. The amendment changes the
name of the Corporation in Article One of the Articles of Incorporation.
Article One is amended and restated in its entirety as follows:
"ARTICLE ONE
The name of the corporation is Henley Healthcare, Inc. (the
"Corporation")."
ARTICLE THREE
The number of shares of the Corporation outstanding at the time of such
adoption was 2,793,556 and the number of shares entitled to vote thereon was
2,793,556.
ARTICLE FOUR
The number of shares of the Corporation voted for the amendment was and
the number of shares of the Corporation voted against the amendment was .
Dated June , 1997 LASERMEDICS, INC.
By: Chike Ogboenyiya,
CORPORATE SECRETARY
12
<PAGE>
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PROXY
LASERMEDICS, INC.
THE BOARD OF DIRECTORS SOLICITS THIS PROXY FOR THE
ANNUAL MEETING OF JUNE 6, 1997
The undersigned stockholder of Lasermedics, Inc. (the "Company") hereby
appoints Michael M. Barbour and Dan D. Sudduth, or either of them, the true and
lawful attorneys, agents and proxies of the undersigned, each with full power of
substitution, to vote on behalf of the undersigned at the Annual Meeting of
Stockholders of the Company to be held at the Ritz Carlton Hotel--Houston
located at 1919 Briar Oaks Lane, Houston, Texas 77027, on Friday, June 6, 1997,
at 10:00 a.m., Houston Time, and at any adjournments of said meeting, all of the
shares of common stock in the name of the undersigned or which the undersigned
may be entitled to vote.
1. THE ELECTION OF DIRECTORS
Nominees are Michael M. Barbour, Dr. Chadwick F. Smith, Dan D. Sudduth,
Dr. Pedro A. Rubio, Kenneth W. Davidson and Dr. Ernest J. Henley.
[ ] Michael M. Barbour [ ] Dr. Chadwick F. Smith [ ] Dan D. Sudduth
[ ] Dr. Pedro A. Rubio [ ] Kenneth W. Davidson [ ] Dr. Ernest J. Henley
INSTRUCTION: If you wish to withhold authority to vote for any individual
nominee or nominees, write the name or names of the nominee(s) on the line
provided:
____________________________________________________________________________
[ ] To withhold authority to vote on ALL nominees for directors listed.
2. APPROVAL OF THE CHARTER AMENDMENT
[ ] For [ ] Against [ ] Abstain
3. [ ] In their discretion, upon such other matters as may properly come before
the meeting; hereby revoking any proxy or proxies heretofore given by the
undersigned.
(THIS PROXY MUST BE DATED AND SIGNED ON THE REVERSE SIDE.)
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(CONTINUED FROM OTHER SIDE)
This Proxy, when properly executed, will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this Proxy will
be voted FOR the election of the six nominees above, FOR approval of the Charter
Amendment and in accordance with the discretion of the persons designated above
with respect to any other business properly before the meeting.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting
of Stockholders and the Proxy Statement furnished herewith.
Dated ____________________________________, 1997
________________________________________________
Stockholder's Signature
________________________________________________
Signature if held jointly
Signature should agree with name printed hereon.
If Stock is held in the name of more than one
person, EACH joint owner should sign. Executors,
administrators, trustees, guardians and attorneys
should indicate the capacity in which they sign.
Attorneys should submit powers of attorney.
PLEASE MARK, SIGN, DATE AND RETURN IN THE ENVELOPE ENCLOSED
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