SCHEDULE 14A INFORMATION
(Cover Page to Schedule 14A)
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange
Act of 1934
(Amendment No. )
Filed by the Registrant [X ]
Filed by a Party other than the Registrant [ ]
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[ ] 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 Section 240.14a-11(c) or
Section 240.14a-12
Uroplasty, Inc.
(Name of Registrant as Specified In Its Charter)
(Not Applicable)
(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.
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computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was determined):
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offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the
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__________________________________________<PAGE>
1998 ANNUAL MEETING
UROPLASTY, INC.
2718 Summer Street NE
Minneapolis, MN 55413-2820
TO THE SHAREHOLDERS OF UROPLASTY, INC.:
You are cordially invited to attend our Annual Meeting of Shareholders
to be held on August 13, 1998 at 4:00 PM (Minneapolis Time) at the
Minneapolis Hilton and Towers, 1001 Marquette Avenue, Minneapolis,
Minnesota.
The formal Notice of Meeting, Proxy Statement and Proxy are attached
and the Company's Annual Report to Shareholders is enclosed. Even if
you do not plan to attend the meeting, please sign, date and return
the enclosed proxy as soon as possible in the envelope provided.
Very truly yours,
/s/ DANIEL G. HOLMAN
Daniel G. Holman
CEO
Minneapolis, Minnesota
July 23, 1998
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY TO SAVE
THE COMPANY THE EXPENSE OF ADDITIONAL SOLICITATION AND TO ASSURE
THAT A QUORUM WILL BE REPRESENTED AT THE MEETING.
UROPLASTY, INC.
2718 Summer Street NE
Minneapolis, MN 55413-2820
_________________________________
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held August 13, 1998
_________________________________
To Our Shareholders:
Notice is hereby given that the Uroplasty, Inc. Annual Meeting of
Shareholders will be held on Thursday, August 13, 1998 at 4:00 PM
(Minneapolis Time) at the Minneapolis Hilton and Towers, 1001
Marquette Avenue, Minneapolis, Minnesota for the following purposes:
1. To fix the number of members of the Board of Directors for the
ensuing year at four.
2. To elect one individual to one class of directors who will serve
until 1999.
3. To consider and act upon such other matters as may properly come
before the meeting or any adjournment thereof.
The close of business on July 15, 1998 has been fixed as the record
date for the determination of shareholders who are entitled to vote at
the meeting or any adjournments thereof.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ SUSAN HARTJES-DOHERTY
Susan Hartjes-Doherty
Secretary
Minneapolis, Minnesota
July 23, 1998
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING.
IF YOU DO NOT PLAN TO ATTEND THE MEETING, PLEASE BE SURE
YOU ARE REPRESENTED AT THE MEETING BY MARKING, SIGNING,
DATING AND MAILING YOUR PROXY IN THE REPLY ENVELOPE.
UROPLASTY, INC.
2718 Summer Street NE
Minneapolis, MN 55413-2820
_______________________________
PROXY STATEMENT
_______________________________
ANNUAL MEETING OF SHAREHOLDERS
AUGUST 13, 1998
_______________________________
INTRODUCTION
The Annual Meeting of Shareholders (the "Annual Meeting") of Uroplasty,
Inc. (the "Company") will be held on August 13, 1998, at 4:00 PM
(Minneapolis Time) at the Minneapolis Hilton and Towers, 1001
Marquette Avenue, Minneapolis, Minnesota, or at any adjournment or
adjournments thereof, for the purposes set forth in the Notice of
Annual Meeting of Shareholders.
A proxy card is enclosed for your use. You are solicited on behalf
of the Board of Directors to SIGN AND RETURN THE PROXY CARD IN THE
ACCOMPANYING ENVELOPE. The cost of soliciting proxies, including the
preparation, assembly and mailing of the proxies and
soliciting material, as well as the cost of forwarding such material
to the beneficial owners of the Company's Common Stock, will be borne
by the Company. Directors, officers and regular employees of the
Company may, without compensation other than their regular
compensation, solicit proxies in person, in writing or by any form
of telecommunication. The Company may reimburse brokerage firms and
others for expenses in forwarding proxy materials to the beneficial
owners of Common Stock.
Any shareholder giving a proxy may revoke it at any time prior to its
use at the Annual Meeting either by giving written notice of such
revocation to the Secretary of the Company, by filing a duly executed
proxy bearing a later date with the Secretary of the Company or by
appearing at the Annual Meeting and filing written notice of
revocation with the Secretary of the Company prior to use of the
proxy. Proxies will be voted as specified by shareholders.
THE BOARD OF DIRECTORS RECOMMENDS THE SHAREHOLDERS VOTE FOR THE
PROPOSALS SET FORTH IN THE NOTICE OF MEETING.
The Company expects this proxy material will first be mailed to
shareholders on or about July 23, 1998.
VOTING OF SHARES
Only holders of Common Stock of record at the close of business on
July 15, 1998 will be entitled to vote at the Annual Meeting. On
July 15, 1998 the Company had 5,917,475 shares of Common Stock
outstanding, each such share entitling the holder thereof to one
vote on each matter to be voted on at the Annual Meeting.
The presence at the Annual Meeting, in person or by proxy, of the
holders of fifty percent (50%) of the outstanding shares of Common
Stock entitled to vote at the meeting (2,958,738 shares) is required
for a quorum for the transaction of business. In general, shares of
Common Stock represented by a properly signed and returned proxy card
will be counted as shares present and entitled to vote at the Annual
Meeting for purposes of determining a quorum, without regard to
whether the card reflects abstentions (or is left blank) or reflects
a "broker non-vote" on a matter (that is, a card returned by a broker
on behalf of its beneficial owner/customer that is not voted on a
particular matter because voting instructions have not been received
and the broker has no discretionary authority to vote).
The election of a nominee for director and any other proposals which
may come before the Annual Meeting described in this Proxy Statement
require the approval of a majority of the shares present and entitled
to vote in person or by proxy on that matter.
PROPOSAL 1
FIX NUMBER OF DIRECTORS AT FOUR
The Bylaws of the Company provide that the Board of Directors shall
consist of one or more members, as determined by the shareholders at a
regular meeting. The Board of Directors recommends the shareholders
fix the number of directors to comprise the Board of Directors for
the ensuing year at four.
PROPOSAL 2
ELECTION OF DIRECTOR
Nomination
As permitted by Minnesota law, the Company's Articles of Incorporation
require that the Board of Directors of the Company be divided into
three classes, with each class containing as nearly as possible
one-third of the total, and each class having a term of three years.
The term of office of each class is staggered so that in any one year
the term of only one class expires.
The Board of Directors (the "Board") has nominated the individual
named below to serve as director of the Company for a term of one
year until the annual meeting of the shareholders in 1999 or until
his successor has been elected and qualified. One member of the
current Board, Carolyn A. Bruhjell, did not stand for re-election.
The Board recommends a vote FOR the election of the nominee listed
below. In the absence of other instructions, the proxies will be
voted FOR the election of the nominee named below. If prior to the
meeting the Board should learn that the nominee will be unable to
serve by reason of death, incapacity or other unexpected occurrence,
the proxies which otherwise would have been voted for such nominee
will be voted for such substitute nominee as selected by the Board.
The Board has no reason to believe that the nominee will be unable
to serve.
Information About the Nominee
The following information has been furnished to the Company as of
July 15, 1998 by the person nominated by the Board to serve as a
director for the term stated.
Name of Nominee Age Principal Occupation
Nominee to Serve in Office until 1999
Alex Gerwer 43 Principal & Consultant, AKN
The business experience of said nominee for director follows:
Alex Gerwer has been a Principal and Consultant for AKN in San Diego,
California, a management consulting firm to medical product companies
since 1990. From 1988 to 1990, he was the Manager of New Business
Development for Nihon Kohden America, a medical electronics company
in Irvine, California. Mr. Gerwer was a Research Scientist for Diatek,
Inc. in San Diego, California from 1986 to 1988. Mr. Gerwer received a
B.S. in Chemistry and Physics from the University of Michigan, and a
Master of Science in Chemical Physics from the California Institute
of Technology.
Information About the Board and its Committees
The business and affairs of the Company are managed by the Board,
which met five times during the fiscal year ended March 31, 1998.
The members of the Compensation Committee during fiscal 1998 were
Messrs. Pitlor and Maxwell and Ms. Bruhjell. The function of the
Compensation Committee is to set the compensation for those officers
who are also directors, and set the terms of and grants of awards
under the Company's 1997 Stock Option Plan (the "1997 Plan") and to
act on other matters relating to compensation as it deems appropriate.
The Compensation Committee met one time during fiscal 1998.
The members of the Nominating Committee during fiscal 1998 were
Messrs. Holman, Pitlor and Maxwell and Ms. Bruhjell. The function
of the Nominating Committee is to consider and recommend to the Board
nominees for election as director. The Nominating Committee was
only established in August 1997 and did not meet during fiscal 1998.
The members of the Audit Committee during fiscal 1998 were Mr. Maxwell
and Ms. Bruhjell. The function of the Audit Committee is to meet
with the Company's independent auditors, review the scope and results
of their audits, review the Company's responses to audit reports, and
consider the adequacy of internal controls and the Company's response
to new regulatory issues and accounting rules. The Audit Committee
was only established in August 1997 and did not meet during fiscal
1998.
All of the Directors attended 100% of the aggregate meetings of the
Board and all committees on which they served during fiscal 1998.
Director Compensation
Mr. Pitlor receives $2,000 per month as a consulting fee from the
Company under a month-to-month agreement. Additionally, non-employee
board members who do not receive any other form of compensation from
the Company receive $500 per board meeting attended.
Messrs. Pitlor and Maxwell hold options to purchase 45,000 shares
of Common Stock and Ms. Bruhjell holds options to purchase 30,000
shares of Common Stock as of March 31, 1998. The exercise price
of the options ranges from $.50 to $3.19 per share.
PRINCIPAL SHAREHOLDERS AND BENEFICIAL
OWNERSHIP OF MANAGEMENT
The following table sets forth information regarding the beneficial
ownership of the Common Stock of the Company as of July 15, 1998
unless otherwise noted (a) by each shareholder who is known by the
Company to own beneficially more than 5% of the outstanding Common
Stock, (b) by each director and executive officer named in the
Summary Compensation Table and (c) by all executive officers and
directors of the Company as a group.
Name and Address Number of Shares
of Beneficial Owner Beneficially Owned (1) Percent of Class (2)
Bruce P. Mindich 1,100,000 18.6%
555 White Plains Road
Tarrytown, NY 10591
Daniel G. Holman 299,981 5.1% (3)
2718 Summer Street NE
Minneapolis, MN 55413-2820
Susan Doherty 122,203 2.1% (4)
2718 Summer Street NE
Minneapolis, MN 55413-2820
Directors and 771,979 13.0% (5)
Executive Officers
as a Group (7 Persons)
_________________________________
(1) Except as otherwise indicated in the footnotes to this table, the
persons named in the table have sole voting and investment power with
respect to all shares of Common Stock. Shares of Common Stock subject
to options or warrants currently exercisable or exercisable within 60
days are considered outstanding for the purpose of computing the
percentage of the person holding any such options or warrants, but
are not considered outstanding for the purpose of computing the
percentage of any other person.
(2) Based on 5,917,475 shares of Common Stock outstanding as of
July 15, 1998.
(3) Includes 95,000 shares held under options to purchase common
stock.
(4) Includes 65,000 shares held under options to purchase common
stock.
(5) Includes 340,000 shares held under options to purchase common
stock.
EXECUTIVE COMPENSATION AND OTHER BENEFITS
Summary of Cash and Certain Other Compensation
The following table sets forth (1) the compensation paid for the years
shown in the table, to Daniel G. Holman, the Company's Chairman,
President, CEO and CFO, and to Susan Hartjes-Doherty, the Company's
Vice President of Regulatory Affairs and Operations and Secretary;
(2) the stock options and stock appreciation rights granted to such
individuals for the years shown; and (3) long-term payouts and other
compensation for the years shown:
Summary Compensation Table
Long Term Compensation (1)
Annual Compensation Awards
(a) (b) (c) (d) (e) (f) (g)
Other Securities
Name Annual Restricted Under-
and Compen- Stock lying
Principal sation Awards Options
Position Year Salary($) Bonus($) ($) ($) SARs(#)
Daniel G.
Holman 1998 161,919 -- 25,632(2) -- 70,000
CEO 1997 154,162 -- 28,818(2) -- 0
1996 146,534 -- 18,016(2) -- 15,000
Susan 1998 102,160 5,000 -- -- 40,000
Hartjes-Doherty,
Vice President
Total Compensation for
All Executive Officers
For Fiscal Year 1998:
(Four Persons) $ 475,617
(1) There were no payouts under a "long-term incentive plan" (called
"LTIP") for the years shown, nor was any other form of compensation
paid or awarded.
(2) Reimbursement of expatriot living expenses in The Netherlands.
_____________________________
Option/SAR Grants Table
Option Grants in Fiscal Year Ended March 31, 1998
Number of Percent of
Securities Total Op-
Underlying tions/SARS
Options Granted to Exercise or Securities
/SARS Employees in Base Price Expiration
Name Granted(#) Fiscal Year ($/Share) Date
Daniel G. 50,000 15.1% $1.00 April 2002
Holman, CEO 20,000 6.0% $3.25 February 2003
Susan Hartjes- 25,000 7.6% $1.00 April 2002
Doherty, V.P. 15,000 4.5% $3.25 February 2003
(1) Options for 250,000 shares were granted to officers and directors
during the fiscal year ended March 31, 1998.
The Company adopted an Incentive Stock Option Plan (the "1995 Plan")
in May 1995 which provided for the granting of options to purchase
350,000 shares of stock. At March 31, 1998 there were 177,200 options
outstanding under the 1995 Plan. In April 1997, the Board of Directors
adopted and in August 1997, the Company's shareholders approved the
1997 Stock Option Plan (the "1997 Plan") pursuant to which 500,000
shares of common stock have been reserved. At March 31, 1998 there
were 313,000 options outstanding under the 1997 Plan. (In addition,
the Company had 15,000 options outstanding not issued pursuant to
either Plan.) Both Plans required that options be granted at exercise
prices equal to or greater than the fair market value of the stock
at the time of the grant.
Aggregated Option/SAR Exercises and Fiscal Year-End
Option/SAR Value Table
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
At FY-End (#) at FY-End ($)
Shares acquired Value Exercisable/ Exercisable/
Name on Exercise Realized($) Unexercisable Unexercisable
Daniel G. 10,000 27,000 95,000/0 $181,250/0
Holman, CEO
Susan Hartjes- -- -- 65,000/0 $125,000/0
Doherty, V.P.
CERTAIN TRANSACTIONS
The Company has a Royalty Agreement with three individuals, namely
Arthur A. Beisang, Jr., Robert A. Ersek, M.D., and Arthur A. Beisang,
III, M.D. Mr. Beisang and Dr. Ersek are former officers and directors
of the Company and, as far as the Company knows, each holds, or did
hold, more than 5% of the Company's outstanding stock. The aggregate
amount of royalty expense recognized by the Company pursuant to such
Royalty Agreement during each of the past three fiscal years was as
follows.
Fiscal Year ended 3/31/98 Uroplasty, Inc. $ 147,860
==========
Fiscal Year ended 3/31/97 Uroplasty, Inc. $ 110,495
==========
Fiscal Year ended 3/31/96 Bioplasty, Inc. $ 1,000
Uroplasty, Inc. 64,695
----------
Total for 1996 $ 65,695
==========
On July 11, 1997, the Company's then second largest shareholder, the
Bioplasty Product Claimants Trust (the "Trust"), which prior to such
date owned 640,000 shares, or 17.5% of the Company's then outstanding
shares of common stock, sold such shares to a group of investors
(the "Investors"). In connection with such transaction, the Trust
sold to the Investors its interest in that certain Promissory Note,
dated March 30, 1994, which, at March 31, 1997, had a principal
balance outstanding of $496,000. Concurrently with the sale by the
Trust of the 640,000 shares to the Investors, the Company agreed to
convert and did convert the Note into 496,000 shares of Common Stock,
at a conversion ratio of $1.00 per share. The Investors, who included
certain registered representatives (or their customers) employed by RJ
Steichen & Co., a Minneapolis broker-dealer, consisted of 33 individuals,
retirement accounts and corporations located primarily in the
Minneapolis/St. Paul, Minnesota area. The aforementioned transaction
was facilitated by certain registered representatives of RJ Steichen
& Co., but they were not directly compensated for their efforts by
either the Trust or the Company, and the Investors did not pay a
commission on the transaction. There was no involvement whatsoever
by R. J. Steichen as an entity.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and executive officers, and persons
who own more than 10% of the Company's Common Stock, to file with the
Securities and Exchange Commission (the "SEC") initial reports of
ownership and reports of changes in ownership of Common Stock and
other equity securities of the Company. Executive officers, directors
and greater than 10% shareholders are required by SEC regulations to
furnish the Company with copies of all Section 16(a) reports they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company during the period ended March
31, 1998 and on any written representation by any of such persons,
all Section 16(a) filing requirements applicable to its executive
officers, directors and greater than 10% shareholders were complied
with, except (i) each of Germain E. Willem, Vice President of Sales
and Marketing; Chris Harris, Vice President of Corporate
Development; Joel R. Pitlor, Director; Daniel Holman, President, CEO
and Chairman of the Board; R. Patrick Maxwell, Director; and Susan
Hartjes-Doherty, Secretary and Vice President of Operations and
Regulatory Affairs, failed to timely file the statement of changes
of beneficial ownership on Form 4 related to the grant of stock
options to each in April 1997; and (ii) Carolyn A. Bruhjell, Director,
failed to timely file the initial statement of beneficial ownership of
securities on Form 3. All such reports have been filed or are in the
process of being filed.
SHAREHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
Proposals of shareholders intended to be presented in the Company's
proxy materials relating to its 1999 Annual Meeting must be received
by the Company at its principal executive offices not less than 120
calendar days prior to July 23, 1999.
MISCELLANEOUS
Other Matters
The management of the Company does not intend to present other items of
business and knows of no items of business which are likely to be
brought before the Annual Meeting except those described in this Proxy
Statement. However, if any other matters should properly come before
the Annual Meeting, the persons named in the enclosed proxy will have
discretionary authority to vote such proxy in accordance with their
best judgment on such matters.
Annual Report to Shareholders
The Company's Annual Report to Shareholders for its fiscal year ended
March 31, 1998 (including audited financial statements) accompanies
this Proxy Statement.
Forward Looking Statements
The Company may from time to time, in an attempt to provide assistance
in understanding its anticipated future financial performance, make
written or oral "forward-looking statements" such as may be contained
in its Annual Report to Shareholders, and elsewhere. "Forward-looking
statements" are, however, by their very nature, subject to known and
unknown risks and uncertainties relating to the Company's future
performance that may cause the actual results, performance or
achievements of the Company, or the industry, to differ materially
from those expressed or implied in any such "forward-looking
statements".
Investors are cautioned that any "forward-looking statements" made
by the Company here or elsewhere are qualified by and subject to the
warnings and cautionary statements contained above and in the "Risk
Factors" and "Forward Looking Statements" sections of its Annual
Report on Form 10-KSB to the SEC for the year ended March 31, 1998.
Independent Auditors
KPMG Peat Marwick LLP ("Peat Marwick") served as the Company's
independent auditor during fiscal years 1996, 1997 and 1998. A
representative of Peat Marwick is expected to be present at the
Annual Meeting to respond to appropriate questions from stockholders
and to make a statement if so desired.
Form 10K-SB
The Company will furnish without charge a copy of its Annual Report
on Form 10-KSB (including financial statements but not exhibits) for
its fiscal year ended March 31, 1998 to each person who was a
shareholder of the Company as of July 15, 1998, upon receipt from
any such person of a written request for such an Annual Report.
Such request should be sent to the Company at:
2718 Summer Street NE, Minneapolis, Minnesota 55413-2820;
ATTN: Shareholder Information.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ SUSAN HARTJES-DOHERTY
Susan Hartjes-Doherty
Secretary
Minneapolis, Minnesota
July 23, 1998
