<PAGE> 1
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 Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
YOUNG INNOVATIONS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No Fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(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 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
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<PAGE> 2
YOUNG INNOVATIONS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON
MAY 11, 1998
TO THE SHAREHOLDERS:
The Annual Meeting of Shareholders of Young Innovations, Inc. (the
"Company") will be held in the Penthouse Ballroom of the Renaissance Hotel, 9801
Natural Bridge Road, Berkeley, Missouri 63134, on May 11, 1998, at 6:30 P.M.,
St. Louis time, for the following purposes:
1. To elect eight Directors to serve until the Annual Meeting of
Shareholders in 1999 or until their successors are duly elected and
qualified;
2. To consider and act upon ratification of the selection of Arthur
Andersen LLP as independent accountants for 1998;
3. To transact such other business as may properly come before the
meeting.
Only shareholders whose names appear of record at the Company's close of
business on March 24, 1998 are entitled to receive notice of and to vote at the
Annual Meeting or any adjournments thereof.
By Order of the Board of Directors,
Richard G. Richmond
Secretary
April 15, 1998
Earth City, Missouri
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. WHETHER OR
NOT YOU INTEND TO BE PRESENT, PLEASE COMPLETE, DATE, SIGN AND RETURN THE
ENCLOSED PROXY CARD IN THE STAMPED AND ADDRESSED ENVELOPE ENCLOSED FOR YOUR
CONVENIENCE. SHAREHOLDERS CAN HELP THE COMPANY AVOID UNNECESSARY EXPENSE AND
DELAY BY PROMPTLY RETURNING THE ENCLOSED PROXY CARD. THE PRESENCE, IN PERSON OR
BY PROPERLY EXECUTED PROXY, OF A MAJORITY OF THE COMMON STOCK OUTSTANDING ON THE
RECORD DATE IS NECESSARY TO CONSTITUTE A QUORUM AT THE ANNUAL MEETING.
<PAGE> 3
YOUNG INNOVATIONS, INC.
13705 SHORELINE COURT EAST
EARTH CITY, MISSOURI 63045
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 11, 1998
This Proxy Statement is being furnished to the common shareholders of Young
Innovations, Inc. (the "Company") on or about April 15, 1998 in connection with
the solicitation of proxies on behalf of the Board of Directors of the Company
for use at the annual meeting of shareholders (the "Annual Meeting") to be held
on May 11, 1998 at the time and place and for the purposes set forth in the
accompanying Notice of Annual Meeting, and at any adjournment or postponement of
that meeting.
Holders of shares of common stock, par value $0.01 per share ("Shares" or
the "Common Stock"), of the Company at its close of business on March 24, 1998
(the "Record Date") will be entitled to receive notice of and vote at the Annual
Meeting. On the Record Date, 6,772,796 shares of Common Stock were outstanding.
Holders of Common Stock (the "Shareholders") are entitled to one vote per share
of Common Stock they held of record on the Record Date on each matter that may
properly come before the Annual Meeting.
A plurality of the votes of Shareholders cast at the Annual Meeting is
required for the election of each director. Ratification of the selection of
independent accountants requires the affirmative vote of holders of a majority
of the Shares voted on the proposal. Abstentions and broker non-votes are
counted in the number of shares present in person or represented by proxy for
purposes of determining whether a quorum is present, but not for purposes of
election of directors or ratification of the selection of independent
accountants.
Management of the Company ("Management"), together with members of the
Board of Directors of the Company, in the aggregate, directly or indirectly
controlled approximately 59% of the Shares outstanding on the Record Date.
Shareholders of record on the Record Date are entitled to cast their votes
in person or by properly executed proxy at the Annual Meeting. The presence, in
person or by properly executed proxy, of a majority of the Common Stock
outstanding on the Record Date is necessary to constitute a quorum at the Annual
Meeting. If a quorum is not present at the time the Annual Meeting is convened,
the Company may adjourn or postpone the Annual Meeting.
All Common Stock represented at the Annual Meeting by properly executed
proxies received prior to or at the Annual Meeting and not properly revoked will
be voted at the Annual Meeting in accordance with the instructions indicated in
such proxies. If no instructions are indicated, such proxies will be voted FOR
the election of the Board's director nominees and FOR the ratification of the
recommended independent accountants. The Board of Directors of the Company does
not know of any matters, other than the matters described in the Notice of
Annual Meeting attached to this Proxy Statement, that will come before the
Annual Meeting.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is voted. Proxies may be revoked by (i) filing
with the Secretary of the Company, at or before the Annual Meeting, a written
notice of revocation bearing a date later than the date of the proxy, (ii) duly
executing and dating a subsequent proxy relating to the Common Stock and
delivering it to the Secretary of the Company at or before the Annual Meeting,
or (iii) attending the Annual Meeting and voting in person (although attendance
at the Annual Meeting will not in and of itself constitute a revocation of a
proxy). Any written notice revoking a proxy should be sent to: Corporate
Secretary, Young Innovations, Inc., 13705 Shoreline Court East, Earth City,
Missouri 63045 (telephone number (314) 344-0010).
The proxies are solicited by the Board of Directors of the Company. In
addition to the use of the mails, proxies may be solicited personally or by
telephone or facsimile transmission, by directors, officers or regular employees
of the Company or persons employed by the Company for the purpose of soliciting
proxies. It is contemplated that brokerage houses, custodians, nominees and
fiduciaries will be requested to forward the soliciting material to the
beneficial owners of Common Stock held of record by such persons, and will be
reimbursed for expenses incurred therewith. The cost of solicitation of proxies
will be borne by the Company.
------------------------
The date of this Proxy Statement is April 15, 1998.
<PAGE> 4
ELECTION OF DIRECTORS
Pursuant to the By-laws of the Company, the Company's Directors are elected
annually and hold office until their successors are duly elected and qualified.
The following table sets forth the names, ages, principal occupations and
other information respecting the director nominees, each of whom is a current
director of the Company:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION
DIRECTOR AGE DURING PAST 5 YEARS
-------- --- --------------------
<S> <C> <C>
George E. Richmond.............. 64 President of Young Dental Manufacturing Company ("Young Dental")
(predecessor to the Company) from 1961 until 1997. President,
Chief Executive Officer and a Director of the Company since its
organization in 1995 and Chairman of the Board since 1997.
Director of UMB Bank of St. Louis, National Association.
Alfred E. Brennan............... 45 Director of the Company since August 1997 and Senior Vice
President and Chief Operating Officer of the Company since
October 1997. Senior Associate of Dewar Sloan from 1995 until
October 1997. President of the Dental Instrument Division of
DENTSPLY International, Inc. from 1991 to 1994. Director of Unico
Systems Inc.
Michael W. Eggleston............ 43 Vice President, Treasurer, Chief Financial Officer and a Director
of the Company since its organization in 1995. Controller,
Secretary, Chief Financial Officer and a Director of Young Dental
since 1980.
Richard G. Richmond............. 43 President of Young Dental since 1997, Secretary and a Director of
the Company since 1995 and a Director of Young Dental since 1989.
Mr. Richmond is George Richmond's son.
Richard P. Conerly(1)(2)........ 73 Director of the Company since August 1997. Retired since 1994.
Chairman and Chief Executive Officer of Orion Capital Inc., a
private investment company, from 1987 to 1994. Director of
LaBarge, Inc. ("LaBarge").
Craig E. LaBarge(1)............. 47 Director of the Company since August 1997. Chief Executive
Officer of LaBarge since 1991 and President of LaBarge since
1986. Director of LaBarge and TALX Corporation.
Arthur L. Herbst, Jr.(2)........ 34 Director of the Company since November 1997. Portfolio Manager
with Roberts, Glore & Co., since September 1995. Director of
Corporate Finance of DENTSPLY International, Inc. from May 1993
through August 1995. Treasurer of GENDEX Corp. from November 1990
to June 1993.
Connie H. Drisko, DDS(2)........ 57 Director of the Company since January 1998. Professor and
Chairperson of the Department of Periodontics, Endodontics and
Dental Hygiene at the University of Louisville School of
Dentistry since September 1993; held teaching position in
Periodontic Department, University of Missouri Kansas City for
ten years prior thereto.
</TABLE>
- -------------------------
(1) Member of Audit Committee.
(2) Member of Compensation Committee.
2
<PAGE> 5
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE BOARD OF
DIRECTORS' SLATE OF NOMINEES STANDING FOR ELECTION.
INFORMATION CONCERNING THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors met two times during 1997. All directors attended at
least 75% of the meetings of the Board and of the committees upon which they
served.
COMPENSATION OF DIRECTORS
Full-time employees of the Company who serve as directors receive only
reimbursement of expenses incurred in attending meetings. Effective November
1997, the Company adopted its 1997 Stock Option Plan pursuant to which each
non-employee Director of the Company received a grant of an option to purchase
up to 5,000 shares of the Company's common stock.
COMMITTEES
The Board of Directors has had standing Audit and Compensation Committees
since November 1997.
The Audit Committee did not meet during 1997. The Committee is composed of
Richard P. Conerly, Chairman, and Craig E. LaBarge. The Committee's
responsibilities include evaluation of significant matters relating to the audit
and internal controls of the Company and review of the scope and results of
audits by the independent auditors.
The Compensation Committee met one time during 1997. The Committee is
composed of Arthur L. Herbst, Jr., Chairman, Richard P. Conerly and Connie H.
Drisko. The Committee reviews the Company's remuneration policies and practices,
including executive salaries, compensation and other employee benefits; and
administers the Company's 1997 Stock Option Plan.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Board of Directors did not have a Compensation Committee
until shortly before the Company's initial public offering in November, 1997.
Compensation of executive officers of the Company during 1997 was determined by
George E. Richmond, Chief Executive Officer of the Company.
EXECUTIVE OFFICERS
The executive officers of the Company, their ages as of March 31, 1997 and
their positions with the Company are set forth below. All officers serve at the
pleasure of the Board of Directors.
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
George E. Richmond........................ 64 Chairman of the Board, President, Chief
Executive Officer and Director
Alfred E. Brennan......................... 45 Senior Vice President, Chief Operating
Officer and Director
Michael W. Eggleston...................... 43 Vice President, Treasurer, Chief Financial
Officer and Director
Richard G. Richmond....................... 43 Secretary and Director; President of Young
Dental
</TABLE>
3
<PAGE> 6
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table summarizes the annual and long-term compensation earned
or awarded to the Company's Chief Executive Officer and each of the Company's
other most highly compensated executive officers for the last two fiscal years.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION AWARDS
ANNUAL -------------------
COMPENSATION SECURITIES
------------ UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY BONUSES(2) OPTIONS
--------------------------- ---- ------ ---------- ----------
<S> <C> <C> <C> <C>
George E. Richmond............................. 1997 $214,400 $15,218
President and Chief 1996 213,812 23,191
Executive Officer
Richard G. Richmond............................ 1997 $111,488 $11,421 32,000
Secretary 1996 92,818 10,741
Michael W. Eggleston........................... 1997 $111,488 $ 7,913 32,000
Vice President, Treasurer 1996 92,818 10,641
and Chief Financial Officer
Alfred E. Brennan.............................. 1997 $101,065 $ 915 60,000
Senior Vice President and
Chief Operating Officer(1)
</TABLE>
- -------------------------
(1) Mr. Brennan became an employee of the Company in October 1997. Amounts
indicated include payments made by the Company for consulting services prior
to Mr. Brennan's employment.
(2) Annual bonus amounts were earned and accrued during the fiscal years
indicated and paid in the following years.
4
<PAGE> 7
OPTIONS/SAR GRANTS
The following table sets forth certain information with respect to options
to purchase Common Stock granted during the year ended December 31, 1997 to each
of the named executive officers who received option grants.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/ POTENTIAL REALIZABLE
UNDERLYING SAR'S VALUE AT ASSUMED
OPTIONS/ GRANTED TO EXERCISE PRICE APPRECIATION
SAR'S EMPLOYEES PRICE FOR OPTION TERM(2)
GRANTED IN FISCAL PER EXPIRATION ----------------------
NAME #(1) YEAR SHARE DATE 5%($)(3) 10%($)(4)
---- ---------- ---------- -------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Alfred E. Brennan............... 60,000 25.4% $12.00 11/04/07 $453,000 $1,147,200
Richard G. Richmond............. 32,000 13.6% $12.00 11/04/07 $241,600 $ 611,840
Michael W. Eggleston............ 32,000 13.6% $12.00 11/04/07 $241,600 $ 611,840
</TABLE>
- -------------------------
(1) No stock appreciation rights ("SAR's") were granted in 1997.
(2) The values shown are based on the indicated assumed annual rates of
appreciation compounded annually. Actual gains realized, if any, on stock
option exercises and Common Stock holdings are dependent on the future
performance of the Common Stock and overall stock market conditions. There
can be no assurance that the values shown in this table will be achieved.
(3) Represents an assumed market price per share of Common Stock of $19.55.
(4) Represents an assumed market price per share of Common Stock of $31.12.
OPTION/SAR EXERCISES
The following table sets forth certain information with respect to the
exercise of options to purchase Common Stock during the year ended December 31,
1997, and the unexercised options held and the value thereof at that date, by
each of the named executive officers.
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTIONS/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS/SAR'S AT OPTIONS/SAR'S AT
ACQUIRED ON VALUE FISCAL YEAR-END(#) FISCAL YEAR-END($)(1)
EXERCISE REALIZED ---------------------------- ----------------------------
NAME # $ EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Alfred E. Brennan........... 0 0 15,000 45,000 $90,000 $270,000
Richard G. Richmond......... 0 0 0 32,000 0 $192,000
Michael W. Eggleston........ 0 0 0 32,000 0 $192,000
</TABLE>
- -------------------------
(1) Based on the closing price of the Company's stock as quoted on the NASDAQ
National Market as of December 31, 1997, of $18.00.
EMPLOYMENT AGREEMENTS
In October 1997, the Company entered into an employment agreement with
Alfred E. Brennan by which Mr. Brennan agreed to serve as the Company's Senior
Vice President and Chief Operating Officer. The employment agreement initially
expires December 31, 1998 but is automatically renewable for an indefinite
number of successive one year terms until cancelled by either party. Mr.
Brennan's annual base salary under the agreement will be at least $180,000.
5
<PAGE> 8
REPORT ON EXECUTIVE COMPENSATION
The Board of Directors did not have a Compensation Committee until shortly
before the Company's initial public offering in November, 1997. Executive
compensation for 1997 was fixed by the Company's Chief Executive Officer. In
establishing compensation levels for the executive officers of the Company in
1997, the Chief Executive Officer considered: (i) statistical information
provided by American Association of Industrial Management ("AAIM") and analyzed
by a wages and compensation consultant concerning compensation levels of
executive officers in manufacturing companies of similar size and sales levels
on a national scale; (ii) profitability of the Company; and (iii) individual
performance of each of the executive officers.
PERFORMANCE GRAPH
The following table and graph compare the cumulative total shareholder
return on the Company's Common Stock from November 4, 1997, the date of the
initial public offering of the Common Stock, through December 31, 1997 and the
NASDAQ Stock Market Composite Index for United States Companies and an industry
peer group. The comparisons reflected in the table and graph, however, are not
intended to forecast the future performance of the Common Stock and may not be
indicative of such future performance. The table and graph assume an investment
of $100 in the Common Stock and each index on November 4, 1997 and the
reinvestment of all dividends; the beginning price for the Company's Common
Stock is $12, the price at which Shares were sold in its initial public
offering.
<TABLE>
<CAPTION>
YOUNG NASDAQ COMPARABLE COMPANY
MEASUREMENT DATE INNOVATIONS, INC. COMPOSITE COMPOSITE(1)
---------------- ----------------- --------- ------------------
<S> <C> <C> <C>
November 4, 1997................................... $100.00 $100.00 $100.00
November 30, 1997.................................. $123.96 $ 98.12 $ 99.98
December 31, 1997.................................. $150.00 $ 96.27 $107.10
</TABLE>
- -------------------------
(1) Comparable Company Composite is a weighted average index based on market
capitalization. The Composite includes Dentsply International, Inc., Sybron
International Corporation, Patterson Dental Company and Henry Schein, Inc.
<TABLE>
<CAPTION>
Young Comparable
Measurement Period Innovations, NASDAQ Company
(Fiscal Year Covered) Inc. Composite Composite
<S> <C> <C> <C>
11/4/97 100.00 100.00 100.00
11/30/97 123.96 98.12 99.98
12/31/97 150.00 96.27 107.10
</TABLE>
6
<PAGE> 9
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Solutions in 3D, Inc. ("3D"), a manufacturer of plastic resin prototypes,
leases space from the Company at its premises in Earth City at a rental of $750
per month. George Richmond and Michael Eggleston own 52.5% and 15.0%,
respectively, of the outstanding common stock of 3D. The Company has, from time
to time, loaned money to 3D which, as of December 31, 1997, aggregated $48,000
with interest payable monthly at the prime rate of a local bank; the note
evidencing the loan has no maturity date and is unsecured. The highest principal
balance of the loan at any time during 1997 was $58,000. 3D's business is
primarily with unrelated third parties. In 1997, the Company paid an aggregate
of $11,982 for plastic resin prototyping services provided to the Company. 3D
leases space from the Company and the Company may continue to loan 3D money from
time to time and purchase services from 3D. The Company has adopted a policy
that all transactions between the Company and any affiliated party will be
approved by a majority of all members of the Company's Board of Directors and by
a majority of the independent and disinterested Directors and will continue to
be on terms no less favorable to the Company than terms the Company believes
would be available from unaffiliated third parties.
George Richmond is a 40% minority shareholder and former officer and
director of Earth City Technologies ("Technologies"), a company located in
Fenton, Missouri. Technologies repairs damaged scalers for the Company returned
by its customers and sells scaler parts. Total amounts paid to Technologies for
repairs in 1997 were $9,414. Technologies purchases certain products and
components from the Company from time to time. Total amounts billed to
Technologies in 1997 were $97,899. Mr. Richmond is currently not an officer,
director or employee of Technologies and plays no role in its management. The
Company believes that arrangements with Technologies are on terms to the Company
as favorable as could be obtained from unaffiliated third parties.
SECURITIES OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following tabulation sets forth information as of March 31, 1997,
concerning the ownership of Common Stock by each Director, each of the executive
officers named in the Summary Compensation Table included in this Proxy
Statement, all Directors and executive officers as a group, and all persons
known by the Company to be the beneficial owners of five percent or more of the
Common Stock. The address of each Director and executive officer listed below is
Young Innovations, Inc., 13705 Shoreline Court East, Earth City, Missouri 63045.
<TABLE>
<CAPTION>
AMOUNT OF SHARES PERCENT
NAME AND ADDRESS BENEFICIALLY OWNED(1) OF CLASS
---------------- --------------------- --------
<S> <C> <C>
George E. Richmond(2)............................ 3,295,065 48.7%
Richard G. Richmond(3)(4)........................ 617,994 9.1
Michael W. Eggleston(4).......................... 60,000 *
Alfred E. Brennan(5)............................. 15,000 *
Richard P. Conerly(6)............................ 10,000 *
Craig E. LaBarge(7).............................. 5,000 *
Arthur L. Herbst Jr.(8).......................... 8,300 *
Connie H. Drisko(9).............................. 5,000 *
All Directors and executive officers as a group
(8 persons).................................... 4,016,359 59.0
</TABLE>
- -------------------------
* Less than 1.0%.
(1) Beneficial ownership of shares, as determined in accordance with applicable
Securities and Exchange Commission rules, includes shares as to which a
person has or shares sole voting power and/or investment power. Except as
otherwise indicated, all shares are held of record with sole voting and
investment power.
(2) Includes 2,388,285 shares held in a revocable trust as to which Mr. Richmond
has sole voting and dispositive power and 906,780 shares held in a trust as
to which Mr. Richmond is a co-trustee and has sole voting power and shared
dispositive power. Excludes 600 shares owned by Mr. Richmond's spouse.
7
<PAGE> 10
(3) Includes 87,549 shares owned directly by Mr. Richard Richmond, 176,815
shares held in a trust for his benefit of which Mr. Richmond is a co-trustee
and has shared voting and dispositive powers, and 353,630 shares held in two
other trusts in which Mr. Richmond is not a beneficiary but is a co-trustee,
and has shared voting and dispositive powers. Mr. Richmond disclaims
beneficial ownership in the 353,630 shares held in the trusts in which he is
not a beneficiary.
(4) Excludes 32,000 shares of Common Stock subject to stock options issued to
each of Messrs. Eggleston and R. Richmond which will become exercisable
ratably over the next four years.
(5) Includes 15,000 shares of Common Stock issuable to Mr. Brennan upon exercise
of stock options currently exercisable. Excludes 45,000 shares of Common
Stock subject to stock options which will become exercisable ratably over
the next three years.
(6) Includes 5,000 shares owned directly by Mr. Conerly and 5,000 shares of
Common Stock issuable to Mr. Conerly upon exercise of stock options.
(7) Includes 5,000 shares of Common Stock issuable to Mr. LaBarge upon exercise
of stock options.
(8) Includes 3,300 shares owned directly by Mr. Herbst and 5,000 shares of
Common Stock issuable to Mr. Herbst upon exercise of stock options. Excludes
1,250 shares owned by Mr. Herbst's spouse and 500 shares owned by Mr.
Herbst's daughters.
(9) Includes 5,000 shares of Common Stock issuable to Ms. Drisko upon exercise
of stock options.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who beneficially own more than ten
percent (10%) of the Company's common stock, to file initial reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Based on a review of the copies of such forms furnished to the Company and
written representations from the Company's executive officers and directors, the
Company believes that all forms were filed in a timely manner during fiscal 1997
except that Michael Eggleston reported on Form 5 one transaction which should
have been reported on Form 4 and Arthur Herbst filed his initial report on Form
3 more than 10 days after his election as a director.
APPOINTMENT OF INDEPENDENT AUDITORS
Arthur Andersen LLP has been appointed to serve as the independent auditors
for the Company and its subsidiary corporations for the fiscal year ending
December 31, 1998. The appointment is being submitted to the shareholders for
ratification.
Arthur Andersen LLP has served as the independent auditors for the Company
and its predecessor since 1994.
Representatives of Arthur Andersen LLP are expected to be present at the
Annual Meeting to respond to shareholders' questions and to have the opportunity
to make any statements they consider appropriate.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR
RATIFICATION OF ITS SELECTION OF ARTHUR ANDERSEN LLP AS INDEPENDENT AUDITORS TO
AUDIT THE ACCOUNTS OF THE COMPANY AND ITS SUBSIDIARIES FOR 1998.
SHAREHOLDERS' PROPOSALS
Shareholders' proposals intended to be presented at the 1999 Annual Meeting
of Shareholders of the Company must be received by the Company at its address
stated above by November 24, 1998 to be considered for inclusion in the
Company's Proxy Statement and Proxy relating to such meeting.
8
<PAGE> 11
OTHER MATTERS
The Board of Directors does not intend to present to the Annual Meeting any
business other than the items stated in the "Notice of Meeting of Shareholders"
and does not know of any other matters to be brought before or voted upon at the
meeting other than those referred to above. If any other matters properly come
before the meeting, it is the intention of the proxies named in the enclosed
Proxy to vote the shares represented thereby with respect to such matters in
accordance with their best judgment.
By Order of the Board of Directors
Michael W. Eggleston
Chief Financial Officer
The Company will furnish without charge to each person whose proxy is solicited,
and to each person representing that as of the record date for the meeting he or
she was a beneficial owner of shares entitled to be voted at the meeting, on
written request, a copy of the Company's 1998 Annual Report on Form 10-K to the
Securities and Exchange Commission, including the financial statements and
schedules thereto. Such written request should be directed to Young
Innovations,Inc., Attention: Mr. Michael W. Eggleston, Chief Financial Officer,
13705 Shoreline Court East, Earth City, Missouri 63045.
9
<PAGE> 12
YOUNG INNOVATIONS, INC.
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS - MAY 11, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder of YOUNG INNOVATIONS, INC. a Missouri
corporation (the "Company"), hereby constitutes and appoints George E. Richmond
and Richard G. Richmond, and each of them, his Attorneys and Proxies (with
full power of substitution in each), and authorizes them to represent the
undersigned at the Annual Meeting of Shareholders of the Company to be held on
May 11, 1998, at 6:30 P.M., and at any adjournment thereof, and to vote the
common stock of the Company held by the undersigned as designated below on
proposals 1 and 2, and in their discretion on all other matters coming before
the Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
BY THE SHAREHOLDER, BUT IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1 AND 2.
1. ELECTION OF DIRECTORS:
/ / FOR all nominees listed (except as marked below) / / WITHHOLD AUTHORITY
to vote for all
nominees listed
below
George E. Richmond, Alfred E. Brennan, Michael W. Eggleston,
Richard G. Richmond, Richard P. Conerly, Craig E. LaBarge,
Arthur L. Herbst, Jr., Connie H. Drisko
(INSTRUCTION): To withhold authority to vote for any individual nominee(s),
print such nominee's(s') name(s) in the space provided below:)
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2. TO RATIFY THE SELECTION OF ARTHUR ANDERSEN LLP AS INDEPENDENT AUDITORS FOR
THE COMPANY:
/ / FOR / / AGAINST / / ABSTAIN
(To be signed on reverse side)
PLEASE MARK (ON REVERSE SIDE), SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
Please sign exactly as name appears hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, trustee or
other representative capacity, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer.
The signer hereby revokes all proxies heretofore given to vote at said meeting
or any adjournment thereof.
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Signature of Shareholder
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Signature of Shareholder
DATED: , 1998
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