SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
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
|X| Definitive Proxy Statement Only (as permitted by Rule 14a-6(e)(2))
| | Definitive Additional Materials
| | Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
KIRLIN HOLDING CORP.
______________________________________________________________________________
(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)(1) 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:*
___________________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
___________________________________________________________________________
(5) Total fee paid:
___________________________________________________________________________
|_| 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:
___________________________________________________________________________
- -------------------
* Set forth the amount on which the filing fee is calculated and state how it
was determined.
<PAGE>
KIRLIN HOLDING CORP.
6901 Jericho Turnpike
Syosset, New York 11791
_________________________
NOTICE OF
ANNUAL MEETING OF STOCKHOLDERS
________________________
June 12, 1998
________________________
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders
("Annual Meeting") of Kirlin Holding Corp. ("Company") will be held at the
offices of the Company at 6901 Jericho Turnpike, Syosset, New York on June 12,
1998, at 11:00 a.m., for the following purposes, all as more fully described in
the attached Proxy Statement:
1. To elect one director to serve for the ensuing three-year period and
until his successor is elected and qualified; and
2. To transact such other business as may properly come before the
meeting and any and all adjournments thereof.
The Board of Directors has fixed the close of business on April 17, 1998,
as the record date for the determination of stockholders entitled to notice of,
and to vote at, the meeting or any adjournment thereof.
You are earnestly requested to date, sign and return the accompanying form
of proxy in the envelope enclosed for that purpose (to which no postage need be
affixed if mailed in the United States) whether or not you expect to attend the
meeting in person. The proxy is revocable by you at any time prior to its
exercise and will not affect your right to vote in person in the event you
attend the meeting or any adjournment thereof. The prompt return of the proxy
will be of assistance in preparing for the meeting and your cooperation in this
respect will be appreciated.
By Order of the Board of Directors
Barry Shapiro, Secretary
Syosset, New York
May 4, 1998
<PAGE>
KIRLIN HOLDING CORP.
_______________________
PROXY STATEMENT
_______________________
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON June 12, 1998
This Proxy Statement and the accompanying form of proxy is furnished to
stockholders of Kirlin Holding Corp. ("Company") in connection with the
solicitation of proxies, in the accompanying form, by the Board of Directors of
the Company for use in voting at the Annual Meeting of Stockholders to be held
at the offices of the Company, 6901 Jericho Turnpike, Syosset, New York on June
12, 1998, at 11:00 a.m., and at any and all adjournments thereof. Any proxy
given pursuant to this solicitation may be revoked by the person giving it by
giving notice to the Secretary of the Company in person, or by written
notification actually received by the Secretary, at any time prior to its being
exercised. Unless otherwise specified in the proxy, shares represented by
proxies will be voted for the election of the nominee listed herein.
The Company's executive offices are located at 6901 Jericho Turnpike,
Syosset, New York 11791. On or about May 4, 1998, this Proxy Statement and the
accompanying form of proxy, together with a copy of the Annual Report of the
Company for the fiscal year ended December 31, 1997, are to be mailed to each
stockholder of record at the close of business on April 17, 1998.
VOTING SECURITIES
The Board of Directors has fixed the close of business on April 17, 1998,
as the record date for the determination of stockholders entitled to notice of,
and to vote at, the Annual Meeting. Only stockholders of record at the close of
business on that date will be entitled to vote at the Annual Meeting or any and
all adjournments thereof. As of April 17, 1998, the Company had issued and
outstanding 2,802,764 shares of Common Stock, the Company's only class of voting
securities outstanding. Each stockholder of the Company will be entitled to one
vote for each share of Common Stock registered in his name on the record date.
The presence, in person or by proxy, of a majority of all of the outstanding
shares of Common Stock constitutes a quorum at the Annual Meeting. Proxies
relating to "street name" shares that are returned to the Company but marked by
brokers as "not voted" will be treated as shares present for purposes of
determining the presence of a quorum on all matters but will not be treated as
shares entitled to vote on the matter as to which authority to vote is withheld
by the broker ("broker non-votes"). The election of directors requires a
plurality vote of those shares voted at the Annual Meeting with respect to the
election of directors. "Plurality" means that the individuals who receive the
largest number of votes cast "FOR" are elected as directors. Consequently, any
shares not voted "FOR" a particular nominee (whether as a result of a direction
to withhold authority or a broker non-vote) will not be counted in such
nominee's favor. All other matters to be voted on will be decided by the
affirmative vote of a majority of the shares present or represented at the
Annual Meeting and entitled to vote. On any such matter, an abstention will have
the same effect as a negative vote, but because shares held by brokers will not
be considered entitled to vote on matters as to which the brokers withhold
authority, a broker non-vote will have no effect on the vote.
<PAGE>
The following table sets forth certain information as of April 17, 1998,
with respect to (i) those persons or groups known to the Company to beneficially
own more than 5% of the Company's Common Stock, (ii) each director and nominee,
(iii) each executive officer whose compensation exceeded $100,000 in fiscal
1997, and (iv) all directors and executive officers as a group. The information
is determined in accordance with Rule 13d-3 promulgated under the Securities
Exchange Act of 1934 based upon information furnished by the persons listed or
contained in filings made by them with the Securities and Exchange Commission.
Except as indicated below, the stockholders listed possess sole voting and
investment power with respect to their shares.
Account and Nature of Percent
Name of Beneficial Owner(1) Beneficial Ownership of Class
- ------------------------ -------------------- --------
David O. Lindner.................. 724,000 25.8%
Anthony J. Kirincic............... 724,000 25.8%
Robert A. Paduano(2).............. 129,200 4.6%
Edward J. Casey................... 1,500 *
Edmund McCormick.................. - 0 - - 0 -
All Executive Officers and
Directors as a Group (5 persons). 1,578,700 56.0%
- ---------------------------------
* Less than 1%.
(1) The business address of Messrs. Lindner and Kirincic is 6901 Jericho
Turnpike, Syosset, New York 11791. Mr. Paduano's business address is
2001 Route 46, Parsippany, New Jersey 07054. Mr. Casey's business
address is 444 South Flower Street, Los Angeles, California 90071. Mr.
McCormick's business address is 18 Bank Street, Summit, New Jersey
07901.
(2) Mr. Paduano resigned as a director and executive officer of the Company
effective April 30, 1998. The number of shares in the table includes an
aggregate of 31,500 shares of Common Stock held by three trusts
established for the benefit of Mr. Paduano's children for which he
serves as co-trustee.
PROPOSAL I: ELECTION OF DIRECTORS
The Board of Directors is divided into three classes, each of which
generally serves for a term of three years, with only one class of directors
being elected in each year. The term of the first class of directors, consisting
of David O. Lindner and Edward J. Casey, will expire in 1999; the term of office
of the second class of directors, consisting of Edward McCormick will expire in
2000; and the term of office of the third class of directors, consisting of
Anthony J. Kirincic, will expire on the date of this year's Annual Meeting. In
each case, each director serves from the date of his election until the end of
his term and until his successor is elected and qualified.
One person will be elected at the Annual Meeting to serve as a director for
a term of three years. The Board of Directors has nominated Anthony J. Kirincic
as the candidate for election. Unless authority is withheld, the proxies
solicited by the Board of Directors will be voted FOR the election of this
nominee. In case the nominee becomes unavailable for election to the Board of
Directors, an event which is not anticipated, the persons named as proxies, or
their substitutes, shall have full discretion and authority to vote or refrain
from voting for any other candidate in accordance with their judgment.
2
<PAGE>
Information About the Nominee
Anthony J. Kirincic has been President, Chief Financial Officer and a
director of the Company and of the Company's wholly-owned subsidiary, Kirlin
Securities, Inc. ("Kirlin"), since the inception of each. He is 36 years old.
Information About the Other Directors and Executive Officers
The Company's other Directors and Executive Officers are as Follows:
Name Age Principal Occupation
- ---------------- --- -----------------------------------------
David O. Lindner 36 Chairman of the Board and Chief Executive
Officer of the Company and Kirlin
Edward J. Casey 38 Director of the Company and Attorney
Edmund McCormick 57 Director and Management Consultant
David O. Lindner has been Chairman of the Board and Chief Executive Officer
of the Company and Kirlin since the inception of each.
Edward J. Casey has been a director of the Company since November 1995.
Since June 1992, Mr. Casey has been an attorney at McClintock, Weston, Benshoof,
Rochefort, Rubalcava and MacCuish. From August 1985 to June 1992, Mr. Casey was
an attorney at Alschuler, Grossman and Pines.
Edmund McCormick has been a director of the Company since February 1998.
Since 1987, Mr. McCormick has been Chairman of the Board of Directors at
McCormick & Co., a management consulting firm. In addition, since 1978, Mr.
McCormick has also been the Chairman of the Board of McCormick Organization, a
real estate management company.
The executive officers of the Company are elected annually by the Board of
Directors and serve at the discretion of the Board.
During the fiscal year ended December 31, 1997, the Company's Board of
Directors held three meetings and acted by unanimous written consent on two
occasions. The Company does not have a standing compensation or nominating
committee. The Board of Directors established an audit committee in November
1995 consisting of Edward J. Casey, David O. Lindner and Robert A. Paduano. In
February 1998, Messrs. Lindner and Paduano resigned and Edmund McCormick was
appointed to the audit committee upon his becoming a director. The functions of
the Audit Committee are to recommend annually to the Board of Directors the
appointment of the independent auditors of the Company, to review with the
independent auditors the scope of the annual audit and review their final report
relating thereto; to review with the independent auditors the accounting
practices and policies of the Company and recommend to whom reports should be
submitted within the Company; to review with internal and independent auditors
overall accounting and financial controls; to be available to the independent
auditors during the year for consultation; and to review related party
transactions by the Company on an ongoing basis and review potential conflicts
of interest situations where appropriate. The audit committee met once in the
fiscal year ended December 31, 1997.
Executive Compensation
The following table sets forth information concerning compensation for the
fiscal years indicated for services in all capacities awarded to, earned by or
paid to the Company's Chief Executive Officer and each of the other most highly
compensated executive officers whose compensation was in excess of $100,000
during the fiscal year ended December 31, 1997.
3
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation(1) Long-Term Compensation
Other Annual Number of
Name and Principal Position Year Salary Bonus Compensation Options All Other
($) ($) ($)(3) (#) Compensation
- --------------------------- ---- ------- ---------- ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C>
1997 325,000 400,000(2) 177,928 -- --
David O. Lindner 1996 225,000 125,000 48,951 66,000(4) --
Chief Executive Officer 1995 200,000 -- 52,593 -- --
1997 325,000 400,000(2) 177,928 -- --
Anthony J. Kirincic 1996 225,000 125,000 48,951 66,000(4) --
President 1995 200,000 52,479 -- --
Robert A. Paduano 1997 237,500 150,000(2) 153,808 -- --
formerly Executive Vice 1996 225,000 -- 51,570 66,000(4) --
President 1995 200,000 -- 52,593 -- --
</TABLE>
(1) The compensation is paid by the Company's wholly-owned subsidiary, Kirlin
Securities, Inc.
(2) Approximately one-half of this amount ($200,250 for Messrs. Lindner and
Kirincic and $76,563.50 for Mr. Paduano) was paid in cash and the
balance was paid by the issuance of the Company's Common Stock under
the Company's 1994 Stock Plan, which was valued at the last sale price
of the Common Stock ($5.875) on the date of the award. Accordingly,
Messrs. Lindner and Kirincic were each issued 34,000 shares and Mr.
Paduano was issued 12,500 shares.
(3) Represents brokerage commissions and in 1997 includes cash received in
the Company's exchange offer of its outstanding stock options and
warrants described below.
(4) Represented options to purchase 66,000 shares of Common Stock for $2.75
per share through January 11, 2001, of which options to purchase 36,000
shares became exercisable on January 12, 1997, and options to purchase
30,000 shares were to have become exercisable on January 12, 1998.
These options were surrendered in July 1997 in the option exchange
described below. On December 22, 1997, the Company effected a
two-for-one stock split of its Common Stock by the declaration and
payment of a 100% stock dividend. All share and exercise price
information in this proxy statement have been adjusted to reflect this
stock split.
The following table summarizes the number of options exercised by the
executive officers named above during the fiscal year ended December 31, 1997,
and the value realized as a result of such exercise.
<TABLE>
<CAPTION>
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
Number of
Name Date Exercised Options Exercised Exercise Price Value Realized
- ------------------------------ -------------- ---------------- -------------- --------------
<S> <C> <C> <C> <C>
David O. Lindner 7/23/97 20,000 $2.75 $15,000
Chairman of the Board
Anthony J. Kirincie 7/23/97 20,000 $2.75 $15,000
President
Robert A. Paduano 7/23/97 36,000 $2.75 $27,000
formerly Executive Vice
President
</TABLE>
No options were granted to the executive officers named above during the
fiscal year ended December 31, 1997. The executive officers named above did not
hold any options at December 31, 1997.
4
<PAGE>
Compensation Arrangements
Kirlin had employment agreements with each of Messrs. Lindner and Kirincic
that expired on December 31, 1996, and which provided for an annual salary of
$225,000 during 1996. Commencing in 1997, Messrs. Lindner and Kirincic began
being paid a salary at an annual rate of $325,000. Each of these officers also
receive and share equally in brokerage commissions generated by their customer
accounts. In addition, Kirlin issues to each of Messrs. Lindner and Kirincic 20%
of any underwriter warrants issuable to Kirlin in connection with its investment
banking activities.
Kirlin also had an employment agreement with Mr. Paduano that expired on
December 31, 1996, and which provided for an annual salary of $225,000 during
1996. Commencing in 1997, Mr. Paduano was paid a salary at an annual rate of
$225,000 until June 30, 1997, and thereafter at a rate of $250,000 per year. Mr.
Paduano also received brokerage commissions generated by his customer accounts
and 5% of any underwriter warrants issuable to Kirlin in connection with its
investment banking activities. Mr. Paduano resigned as a director and executive
officer of the Company and Kirlin effective April 30, 1998 and his employment by
Kirlin is expected to cease on May 15, 1998. Until that time Mr. Paduano will
continue to receive brokerage commissions, but will no longer receive a salary
or a portion of underwriter warrants. In consideration for certain covenants not
to compete for a period of two years following the cessation of his employment,
Mr. Paduano will receive a severance payment of $300,000 payable in 15 monthly
installments.
Edward J. Casey, the only director of the Company in 1997 not employed by
the Company's subsidiary, Kirlin, received an annual director's fee of $12,000,
payable quarterly, in 1997. Commencing in 1998, the non-employee directors,
Messrs. Casey and McCormick, receive annual directors' fees of $15,000 payable
quarterly. In addition, on January 12, 1996, Mr. Casey was granted options to
purchase 5,000 shares of Common Stock for $2.75 per share through January 11,
2006, which options became exercisable on January 12, 1997. These options were
surrendered in the option exchange described below.
1997 Option and Warrant Exchange
In order to reduce the number of outstanding stock options and warrants to
purchase shares of Common Stock, in July 1997 the Company made an exchange offer
to the holders of all of its outstanding stock options and warrants. The offer
involved the exchange and surrender of these options or warrants for cash,
Common Stock or a combination of one-half cash and one-half Common Stock, all at
various specified exchange rates dependent upon the grant date and exercise
price of the option. All of the Company's executive officers and directors
holding options and warrants fully participated in the exchange offer as shown
in the following table:
<TABLE>
<CAPTION>
Number of Number of
Options and Shares of
Warrants Common Stock
Exchanged and Received in Cash Received
Participant Surrendered Exchange in Exchange
- ----------------------- --------------- ------------ --------------
<S> <C> <C> <C>
David O. Lindner 122,092 - 0 - $87,808
Anthony J. Kirincic 122,092 - 0 - $87,808
Robert A. Paduano 106,092 - 0 - $73,808
Edward J. Casey 5,000 - 0 - $ 4,375
</TABLE>
Stock Option Plans
In August 1994, the Company adopted the 1994 Stock Plan ("1994 Plan")
covering 1,200,000 shares of the Company's Common Stock pursuant to which
5
<PAGE>
officers, directors, key employees and consultants of the Company are eligible
to receive incentive or non-qualified stock options, stock appreciation rights,
restricted stock awards, deferred stock, stock reload options and other stock
based awards. The 1994 Plan will terminate at such time that no further awards
may be granted and awards granted are no longer outstanding, provided that
incentive options may only be granted until August 1, 2004. The 1994 Plan is
administered by the Board of Directors. To the extent permitted under the
provisions of the 1994 Plan, the Board of Directors has authority to determine
the selection of participants, allotment of shares, price, and other conditions
of purchase of awards and administration of the 1994 Plan. In June 1996, the
Company adopted the 1996 Stock Plan ("1996 Plan"), covering 2,000,000 shares of
the Company's Common Stock, which is substantially identical to the 1994 Plan
except that incentive options may be granted until April 10, 2006.
Compliance with Section 16(a) of the Exchange Act
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's officers, directors and persons who beneficially own more than ten
percent of the Company's Common Stock to file reports of ownership and changes
in ownership with the Securities and Exchange Commission. These reporting
persons also are required to furnish the Company with copies of all Section
16(a) forms they file. To the Company's knowledge, based solely on its review of
the copies of such forms furnished to it and representations that no other
reports were required, the Company believes that all Section 16(a) reporting
requirements were complied with during the fiscal year ended December 31, 1997.
INDEPENDENT ACCOUNTANTS
The Company anticipates that it will select the independent accounting firm
of Goldstein Golub Kessler & Company, P.C. as the auditors of the Company for
the fiscal year ending December 31, 1998, although no formal recommendation has
been made to the Company's Board of Directors by its audit committee as of the
date of this proxy statement. A representative of Goldstein Golub Kessler &
Company, P.C., the auditors of the Company for the fiscal year ended December
31, 1997, is expected to be present at the Annual Meeting. The representative
will have the opportunity to make a statement and will be available to respond
to appropriate questions from stockholders.
1999 STOCKHOLDER PROPOSALS
In order for stockholder proposals for the 1998 Annual Meeting of
Stockholders to be eligible for inclusion in the Company's Proxy Statement, they
must be received by the Company at its principal office in Syosset, New York not
later than January 4, 1999.
SOLICITATION OF PROXIES
The solicitation of proxies in the enclosed form is made on behalf of the
Company and the cost of this solicitation is being paid by the Company. In
addition to the use of the mails, proxies may be solicited personally or by
telephone or telephone using the services of directors, officers and regular
employees of the Company at nominal cost. Banks, brokerage firms and other
custodians, nominees and fiduciaries will be reimbursed by the Company for
expenses incurred in sending proxy material to beneficial owners of the
Company's stock.
OTHER MATTERS
The Board of Directors knows of no matter which will be presented for
consideration at the Annual Meeting other than the matters referred to in this
Proxy Statement. Should any other matter properly come before the Annual
Meeting, it is the intention of the persons named in the accompanying proxy to
vote such proxy in accordance with their best judgment.
Barry Shapiro, Secretary
Syosset, New York
May 4, 1998
6
<PAGE>
KIRLIN HOLDING CORP. - PROXY
Solicited By The Board Of Directors
for Annual Meeting To Be Held on June 12, 1998
P The undersigned Stockholder(s) of KIRLIN HOLDING CORP., a Delaware
corporation ("Company"), hereby appoints Anthony J. Kirincic and David O.
Lindner, or either of them, with full power of substitution and to act
without the other, as the agents, attorneys and proxies of the undersigned,
to vote the shares standing in the name of the undersigned at the Annual
R Meeting of Stockholders of the Company to be held on June 12, 1998 and at
all adjournments thereof. This proxy will be voted in accordance with the
instructions given below. If no instructions are given, this proxy will be
voted FOR all of the following proposals.
O 1. Election of the following Director:
X Anthony J. Kirincic
FOR |_| WITHHOLD AUTHORITY |_|
Y
2. In their discretion, the proxies are authorized to vote upon such
other business as may come before the meeting or any adjournment
thereof.
Date _____________________________, 1998
__________________________________________
Signature
__________________________________________
Signature if held jointly
Please sign exactly as name appears above. When shares are
held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian,
please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name
by authorized person.
