SCHEDULE 14A
(RULE 14A-101)(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OFProxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
[X]
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[ ]registrant [X]
Filed by a party other than the Registrantregistrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))proxy statement
[ ] Definitive Proxy Statementproxy statement
[ ] Definitive Additional Materialsadditional materials
[ ] Soliciting Material Undermaterial pursuant to Rule 14a-11(c) or Rule 14a-12
The Female Health Company
- --------------------------------------------------------------------------------THE FEMALE HEALTH COMPANY
(Name of Registrant as Specified in Its Charter)
Registrant
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)Statement)
Payment of filing fee (Check the appropriate box):
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(1) Title of each class of securities to which transaction applies:
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- --------------------------------------------------------------------------------
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Not Applicable
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(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):
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- --------------------------------------------------------------------------------0-11:
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- --------------------------------------------------------------------------------filed:
THE FEMALE HEALTH COMPANY
515 North State Street
Suite 2225
Chicago, Illinois 60610
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 15, 200227, 2003
To the Shareholders of The Female Health Company:
Notice is hereby given that the Annual Meeting of the Shareholders of The
Female Health Company (the "Company" or "FHC") will be held at the Renaissance
Chicago Hotel, RhineThe Hampton Inn &
Suites, Alder Room, Third Floor, One33 West Wacker Drive,Illinois Street, Chicago, Illinois 60601-1802,60610, on March
15, 200227, 2003 at 2:00 p.m., local time, for the following purposes:
1. To amend the Company's Amended and Restated Articles of
Incorporation to increase the number of shares of the Company's Common Stock
authorized from 27,000,00035,500,000 to 35,500,000.38,500,000. Details of the proposed increase in
authorized shares of Common Stock are set forth in the accompanying Proxy
Statement which you are urged to read carefully.
2. To elect eight members to the Board of Directors, the names of whom
are set forth in the accompanying proxy statement, to serve until the 20032004
Annual Meeting.
3. To consider and act upon a proposal to ratify the appointment of
McGladrey & Pullen, LLP as the Company's independent public accountants for the
fiscal year ending September 30, 2002.2003.
4. To transact such other business as may properly come before the
Annual Meeting and any adjournments thereof.
Shareholders of record at the close of business on January 15, 200217, 2003 are
entitled to vote at the Annual Meeting. All shareholders are cordially invited
to attend the Annual Meeting in person. Shareholders who are unable to be
present in person are requested to execute and return promptly the enclosed
proxy, which is solicited by the Board of Directors of the Company.
By Order of the Board of Directors,
William R. Gargiulo, Jr.
Secretary
Chicago, Illinois
February 6, 200219, 2003
THE FEMALE HEALTH COMPANY
515 North State Street
Suite 2225
Chicago, Illinois 60610
PROXY STATEMENT
FOR THE 20022003 ANNUAL
MEETING OF SHAREHOLDERS
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of The Female Health Company (the "Company")
to be voted at the Annual Meeting of Shareholders to be held at the Renaissance
Chicago Hotel, RhineThe Hampton Inn
& Suites, Alder Room, Third Floor, One33 West Wacker Drive,Illinois Street, Chicago, Illinois 60601-1802,60610, , at
2:00 p.m. local time on March 15, 2002,27, 2003, and at any adjournments thereof, for the
purposes set forth in the accompanying Notice of Meeting. The mailing to
shareholders of this Proxy Statement and accompanying form of proxy will take
place on or about February 6, 2002.19, 2003.
GENERAL INFORMATION
The Board of Directors knows of no business which will be presented to the
Annual Meeting other than the matters referred to in the accompanying Notice of
Meeting. However, if any other matters are properly presented to the Annual
Meeting, it is intended that the persons named in the proxy will vote on such
matters in accordance with their judgment. If the enclosed form of proxy is
executed and returned, it nevertheless may be revoked at any time before it has
been voted by a later dated proxy or a vote in person at the Annual Meeting.
Shares represented by properly executed proxies received on behalf of the
Company will be voted at the Annual Meeting (unless revoked prior to their vote)
in the manner specified therein. If no instructions are specified in a signed
proxy returned to the Company, the shares represented thereby will be voted FOR:
(a) the amendment of the Company's Amended and Restated Articles of
Incorporation; (b) the election of the directors listed in the enclosed proxy;
and (c) ratification of McGladrey & Pullen, LLP as the Company's independent
auditors.
Only holders of the Company's Common Stock (the "Common Stock") and holders
of the Company's Class A Convertible Preferred Stock-Series 1 (the "Series 1
Preferred Stock") whose names appear of record on the books of the Company at
the close of business on January 15, 200217, 2003 are entitled to vote at the Annual
Meeting. On that date, there were 16,000,31618,898,901 shares of Common Stock and 660,00056,000
shares of Series 1 Preferred Stock outstanding. Each share of Common Stock and
Series 1 Preferred Stock is entitled to one vote on each matter to be presented
at the Annual Meeting. A majority of the votes entitled to be cast with respect
to each matter submitted to the shareholders, represented either in person or by
proxy, shall constitute a quorum with respect to such matter.
Under Wisconsin law, directors are elected by plurality, meaning that the
eight individuals receiving the largest number of votes are elected as
directors, and the ratification of the appointment of the independent auditors
requires the affirmative vote of a majority of the shares represented, in person
or by proxy, at the Annual Meeting. In addition, under Wisconsin law, an
amendment to the Company's Amended and Restated Articles of Incorporation must
be approved by the affirmative vote of holders of two-thirds of the shares
"entitled" to vote on the proposal. Abstentions and broker nonvotes (i.e.,
shares held by brokers in street name, voting on certain matters due to
discretionary authority or instruction from the beneficial owners but not voting
on other matters due to lack of authority to vote on such matters without
instructions from the beneficial owners) will count toward the quorum
requirement but will not count toward the determination of whether directors are
elected or the appointment of the independent auditors is ratified. However,
because the amendment to the Company's Amended and Restated Articles of
Incorporation must be approved by the affirmative vote of holders of two-thirds
of the Company's outstanding Common Stock and Series 1 Preferred Stock, voting
together, abstentions and broker nonvotes will act as a vote against the
proposed amendment.
AMENDMENT OF COMPANY'S AMENDED AND RESTATED ARTICLES OF INCORPORATION
(ITEM 1)
The Company's Amended and Restated Articles of Incorporation authorize the
issuance of 32,015,00040,515,000 shares consisting of: (a) 27,000,00035,500,000 shares designated
as "Common Stock" with a par value of $0.01 per share; (b) 5,000,000 shares
designated as "Class A Preferred Stock" with a par value of $0.01 per share; and
(c) 15,000 shares designated as "Class B Preferred Stock" with a par value of
$0.50 per share. The proposed amendment to the Company's Amended and Restated
Articles of Incorporation will increase the number of shares of Common Stock
which the Company is authorized to issue from 27,000,00035,500,000 to 35,500,000.38,500,000. The
additional 8,500,0003,000,000 shares of Common Stock will be part of the existing class
of Common Stock, and if and when issued, will have the same rights and
privileges as the shares of Common Stock presently issued and outstanding.
PURPOSE OF THE PROPOSED AMENDMENT
As of January 15, 2002,February 10, 2003, the Company had 16,000,31618,898,901 shares of Common Stock,
and 660,00056,000 shares of Series 1 Preferred Stock outstanding. In addition, as of
January 15, 2002,February 10, 2003, the Company has reserved 13,617,03312,710,175 shares of Common Stock
for the purposes of covering options outstanding under the Company's stock
option plans, options the Company is contractually obligated to issue in March
2003, warrants outstanding, deferred Common Stock issued to the Company's U.K.
employees and conversion of Series 1 Preferred Stock and
conversion of convertible debentures. In September 2001, the holders of
exercisable stock options to purchase an
2
aggregate of 2,659,800 shares of Common Stock agreed to waive their rights to
exercise such options until the proposed amendment to the Company's Amended and
Restated Articles of Incorporation is filed following approval at the Annual
Meeting. In consideration for these waivers, the Company agreed to reduce the
exercise price of such options to $0.56 per share. Excluding the stock options
covered by these waivers, asStock. As of the date of this
proxy statement, the Company has 42,45131,609,076 shares of Common Stock either
outstanding or reserved to cover the commitments set forth in the preceding
sentence, and, accordingly, there are only 3,890,924 unreserved and unissued
shares of Common Stock available for future transactions.
If the proposed amendment to the Company's Amended and Restated
Articles of Incorporation is approved at the Annual Meeting, the stock options
covered by these waivers will become exercisable again and the Company would
have 5,882,651 unreserved and unissued shares of Common Stock available for
future transactions.
Except as described above, the Company has no present plans, understandings
or requirements for the issuance or use of the proposed additional shares of
Common Stock. However, the2
The Board of Directors believes that the authority to issue additional shares of
Common Stock is desirable so that, as the need may arise, the Company will have
the flexibility to issue shares of Common Stock, without the delay of a special
shareholders' meeting, in connection with possible future transactions,
including equity financings and management incentive or employee benefit plans.
CERTAIN EFFECTS OF THE PROPOSED AMENDMENT
If the proposed amendment to the Company's Amended and Restated Articles of
Incorporation is approved and effected, future issuances of shares of Common
Stock may not require the approval of the Company's shareholders. As a result,
the Board of Directors could issue shares of Common Stock in a manner that might
have the effect of discouraging or making it more difficult for a third party to
acquire control of the Company through a tender offer or proxy solicitation or
to effect a merger or other business combination that is not favored by the
Board of Directors. In addition, issuances of shares of Common Stock may
increase the number of shares of Common Stock that may become available for sale
in the public market and could adversely affect the price of the Common Stock in
the public market. The issuance of additional shares of Common Stock could also
adversely affect the voting power of the existing shareholders, including the
loss of voting control to others. Holders of Common Stock do not have
preemptive rights or other rights to subscribe for additional shares in the
event that the Board of Directors determines to issue additional shares of
Common Stock in the future.
NO DISSENTER'S RIGHTS
Under Wisconsin law, shareholders are not entitled to dissenters' rights
with respect to the proposed amendment to the Company's Amended and Restated
Articles of Incorporation.
3
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors recommends that the shareholders vote FOR the
proposed amendment to the Company's Amended and Restated Articles of
Incorporation. All shares of Common Stock represented by properly executed
proxies received prior to or at the Annual Meeting and not revoked will be voted
FOR the proposal unless a vote against or an abstention with respect to such
proposal is specifically indicated. If the proposal is adopted by the requisite
vote of shareholders, the Board of Directors will promptly cause Articles of
Amendment to be filed with the Department of Financial Institutions of the State
of Wisconsin. The Articles of Amendment will become effective upon such filing.
3
ELECTION OF DIRECTORS
(Item(ITEM 2)
Pursuant to the authority contained in the Amended and Restated By-Laws of
the Company, the Board of Directors has established the number of directors at
eight. The Board of Directors has nominated O.B. Parrish, Mary Ann Leeper,
Ph.D., William R. Gargiulo, Jr., Mary Ann
Leeper, Ph.D., O.B. Parrish,David R. Bethune, Stephen M. Dearholt, DavidJames R.
Bethune,Kerber, Michael R. Walton James R. Kerber and Richard E. Wenninger for election as directors,
all to serve until the 20032004 Annual Meeting of Shareholders.
As indicated below, all persons nominated by the Board of Directors are
incumbent directors. The Company anticipates that all of the nominees listed in
this Proxy Statement will be candidates when the election is held. However, if
for any reason any nominee is not a candidate at that time, proxies will be
voted for any substitute nominee designated by the Company (except where a proxy
withholds authority with respect to the election of directors).
NOMINEES FOR ELECTION AS DIRECTORS
O.B. PARRISH
Age: 68;69; Elected Director: 1987; Present Term Ends: 20022003 Annual Meeting
O.B. Parrish has served as Chief Executive Officer of the Company since
1994, as acting Chief Financial and Accounting Officer from February 1996 to
March 1999 and as the Chairman of the Board and a Director of the Company since
1987. Mr. Parrish is a shareholder and has served as the President and as a
Director of Phoenix Health Care of Illinois, Inc. ("Phoenix of Illinois") since
1987. Phoenix of Illinois owns approximately 295,000 shares of the Company's
Common Stock. Mr. Parrish also is Chairman and a Director of ViatiCare, LLC, a
financial services company, Chairman and a Director of MIICRO, Inc., a
neuroimaging company, and Chairman and a Director of Amerimmune
4
Pharmaceuticals,
Inc. Mr. Parrish is also a trustee of Lawrence University. From 1977 until
1986, Mr. Parrish was President of the Global Pharmaceutical Group of G.D.
Searle & Co. ("Searle"), a pharmaceutical/consumer products company. From 1974
until 1977, Mr. Parrish was the President of Searle International, the foreign
sales operations of Searle. Prior to that, Mr. Parrish was Executive Vice
President of Pfizer's International Division.
MARY ANN LEEPER, PH.D.
Age: 61;62; Elected Director: 1987; Present Term Ends: 20022003 Annual Meeting
Dr. Leeper has served as the President and Chief Operating Officer of the
Company since 1996 and as President and Chief Executive Officer of The Female
Health Company Division from May 1994 until January 1996, as Senior Vice
President-Development of the Company from 1989 until January 1996 and as a
Director of the Company since 1987. Dr. Leeper is a shareholder and has served
as a Vice President and Director of Phoenix of Illinois since 1987. From 1981
until 1986, Dr. Leeper served as Vice President-Market Development for Searle's
Pharmaceutical Group and in various Searle research and development management
positions. As Vice President-Market Development, Dr. Leeper was responsible for
worldwide licensing and acquisition, marketing and market research. In earlier
positions, she was responsible for preparation of new drug applications and was
a liaison with the FDA. Dr. Leeper currently serves on the Board of Directors
of the Temple University School of Pharmacy, the University of Virginia School
of Nursing and the Northwestern University School of Music. Dr. Leeper is also
on the Board of CEDPA, an international not-for-profit organization working on
women's issues in the developing world and is a Director of Influx, Inc., a
pharmaceutical research company. She is also an adjunct professor at the
University of Virginia Darden School of Business.
WILLIAM4
DAVID R. GARGIULO, JR.BETHUNE
Age: 73; Elected Director: 1987; Present Terms Ends: 2002 Annual Meeting
William R. Gargiulo, Jr. has served as Secretary of the Company from 1996
to present, as Vice President from 1996 to September 30, 1998, as Assistant
Secretary of the Company from 1989 to 1996, as Vice President-International of
The Female Health Company Division from 1994 until January 1996, as Chief
Operating Officer of the Company from 1989 to 1994, and as General Manager of
the Company from 1988 to 1994. Mr. Gargiulo has also served as a Director of
the Company since 1987. Mr. Gargiulo is a Trustee of a trust which is a
shareholder of Phoenix of Illinois. From 1984 until 1986, Mr. Gargiulo was the
Executive Vice President of the Pharmaceutical Group of Searle, in charge of
Searle's European operations. From 1976 until 1984, Mr. Gargiulo was the Vice
President of Searle's Latin American operations.
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STEPHEN M. DEARHOLT
Age: 55;62; Elected Director: 1996; Present Term Ends: 2002 Annual Meeting
Mr. Dearholt has served as a Director since April 1996. Mr. Dearholt is a
co-founder of and has been a partner in Insurance Processing Center, Inc., one
of the largest privately owned life insurance marketing organizations in the
United States, since 1972. He has over 23 years of experience in direct
response advertising and data based marketing of niche products. Since 1985, he
has been a 50% owner of R.T. of Milwaukee, a private investment holding company
which operates a stock brokerage business in Milwaukee, Wisconsin. In late
1995, Mr. Dearholt arranged, on very short notice, a $1 million bridge loan
which assisted the Company in its purchase of Chartex. Mr. Dearholt is also
very active in the nonprofit sector. He is currently on the Board of Directors
of Children's Hospital Foundation of Wisconsin, an honorary board member of the
Zoological Society of Milwaukee, and the national Advisory Council of the
Hazelden Foundation. He is a past board member of Planned Parenthood
Association of Wisconsin, and past Chairman of the Board of the New Day Club,
Inc.
DAVID R. BETHUNE
Age: 61; Elected Director: 1996; Present Term Ends: 20022003 Annual Meeting
Mr. Bethune has served as a Director since January 1996. Mr. Bethune has
been Chairman and Chief Executive Officer of Atrix Laboratories, Inc. since
1999. From 1997 to 1998, Mr. Bethune held the position of President and Chief
Operating Officer of the IVAX Corporation. From 1996 to 1997, Mr. Bethune was a
consultant to the pharmaceutical industry. From 1995 to 1996, Mr. Bethune was
President and Chief Executive Officer of Aesgen, Inc. a generic pharmaceutical
company. From 1992 to 1995, Mr. Bethune was Group Vice President of American
Cyanamid Company and a member of its Executive Committee until the sale of the
company to American Home Products. He had global executive authority for human
biologicals, consumer health products, pharmaceuticals and opthalmics, as well
as medical research. Mr. Bethune is on the Board of Directors of the Southern
Research Institute, Atrix Laboratories, Inc. and the American Foundation for
Pharmaceutical Education, Partnership for Prevention. He is a founding trustee
of the American Cancer Society Foundation and an associate member of the
National Wholesale Druggists' Association and the National Association of Chain
Drug Stores. He is the founding chairman of the Corporate Council of the
Children's Health Fund in New York City and served on the Arthritis Foundation
Corporate Advisory Council.
6STEPHEN M. DEARHOLT
Age: 56; Elected Director: 1996; Present Term Ends: 2003 Annual Meeting
Mr. Dearholt has served as a Director since April 1996. Mr. Dearholt is a
co-founder of and has been a partner in Insurance Processing Center, Inc., one
of the largest privately owned life insurance marketing organizations in the
United States, since 1972. He has over 23 years of experience in direct
response advertising and data based marketing of niche products. Since 1985, he
has been a 50% owner of R.T. of Milwaukee, a private investment holding company
which operates a stock brokerage business in Milwaukee, Wisconsin. In late
1995, Mr. Dearholt arranged, on very short notice, a $1 million bridge loan
which assisted the Company in its purchase of Chartex. Mr. Dearholt is also
very active in the non-profit sector. He is currently on the Board of Directors
of Children's Hospital Foundation of Wisconsin, an honorary board member of the
Zoological Society of Milwaukee, and the national Advisory Council of the
Hazelden Foundation. He is a past board member of Planned Parenthood
Association of Wisconsin, and past Chairman of the Board of the New Day Club,
Inc.
WILLIAM R. GARGIULO, JR.
Age: 74; Elected Director: 1987; Present Terms Ends: 2003 Annual Meeting
William R. Gargiulo, Jr. has served as Secretary of the Company from 1996
to present, as Vice President from 1996 to September 30, 1998, as Assistant
Secretary of the Company from 1989 to 1996, as Vice President-International of
The Female Health Company Division from 1994 until 1996, as Chief Operating
Officer of the Company from 1989 to 1994, and as General Manager of the Company
from 1988 to 1994. Mr. Gargiulo has also served as a Director of the Company
since 1987. Mr. Gargiulo is a Trustee of a trust which is a shareholder of
Phoenix of Illinois. From 1984 until 1986, Mr. Gargiulo was the Executive Vice
President of the Pharmaceutical Group of Searle, in charge of Searle's European
operations. From 1976 until 1984, Mr. Gargiulo was the Vice President of
Searle's Latin American operations.
5
MICHAELJAMES R. WALTONKERBER
Age: 63;70; Elected Director: 1999; Present Term Ends: 20022003 Annual Meeting
Mr. Kerber has served as a Director since April 1999. Mr. Kerber has been
a business consultant to the insurance industry since January 1996. He has over
40 years of experience in operating insurance companies, predominantly those
associated with life and health. From 1994 to 1996, he was Chairman, President,
Chief Executive Officer and director of the 22 life and health insurance
companies which comprise the ICH Group. In 1990, Mr. Kerber a founding partner
in the Life Partners Group where he was Senior Executive Vice President and a
director. Prior to that, he was involved with operating and consulting over 200
life and health companies for ICH Corporation, HCA Corporation and US Life
Corporation.
MICHAEL R. WALTON
Age: 64; Elected Director: 1999; Present Term Ends: 2003 Annual Meeting
Mr. Walton has served as a Director since April 1999. Mr. Walton is
President and owner of Sheboygan County Broadcasting Co., Inc., a company he
founded in 1972. In addition to its financial assets, Sheboygan County
Broadcasting Co. currently owns four radio stations. The company has focused on start-up situations, and growing
value in underperforming, and undervalued businessradio station and newspaper
situations. It has purchased and sold properties in Wisconsin, Illinois, and
Michigan, and has grown to a multi-million dollar asset base from a start-up
capital contribution of less than $100,000. Prior to 1972, Mr. Walton was owner
and President of Walton Co., an advertising representative firm which he founded
in New York City. He has held sales and management positions with Forbes
Magazine, The Chicago Sun Times and Gorman Publishing Co., a trade magazine
publisher specializing in new magazines which was subsequently sold to a large
international publishing concern. Mr. Walton has served on the Boards of the
American Red Cross, The Salvation Army and the Chamber of Commerce.
JAMES R. KERBER
Age: 69; Elected Director: 1999; Present Term Ends: 2002 Annual Meeting
Mr. Kerber has served as a Director since April 1999. Mr. Kerber has been
a business consultant to the insurance industry since January 1996. He has over
40 years of experience in operating insurance companies, predominantly those
associated with life and health. From 1994 to 1996, he was Chairman, President,
Chief Executive Officer and director of the 22 life and health insurance
companies which comprise the ICH Group. In 1990, Mr. Kerber was founding
partner in the Life Partners Group where he was Senior Executive Vice President
and a director. Prior to that, he was involved with operating and consulting
over 200 life and health companies for ICH Corporation, HCA Corporation and US
Life Corporation.
RICHARD E. WENNINGER
Age: 54;55; Director: 2001; Present Term Ends: 20022003 Annual Meeting
Mr. Wenninger has served as a Director since July 2001. Mr. Wenninger
currently serves as Chairman of Wenninger Company, Inc., a mechanical
contracting and engineering company. From 1976 to 2001, Mr. Wenninger served as
President and Chief Executive Officer of Wenninger Company, Inc. He is also
Secretary of Wenn Soft, Inc., a software development, sales and service company
he founded in 1997. From 1992 to 1999, Mr. Wenninger served as Secretary of
Liftco, Inc. Mr. Wenninger is a current board member of the Boys & Girls Club
of Milwaukee, a former President and board member of the Milwaukee Athletic
Club, a former board member of the Wisconsin Psychoanalytic Foundation, a former
board member of University Lake School, the 7
former President and a current board
member of the Plumbing and Mechanical Contractors Association of Milwaukee, the
former President and a former board member of the Sheet Metal Contractors
Association of Milwaukee and a former board member of the Mechanical Contractors
Association of America.
The Board of Directors recommends that shareholders vote FOR all nominees.
6
INDEPENDENT PUBLIC ACCOUNTANTS
(Item(ITEM 3)
The Board of Directors has appointed McGladrey & Pullen, LLP, independent
public accountants, to audit the financial statements of the Company for the
fiscal year ending September 30, 2002.2003. The Board proposes that the shareholders
ratify this appointment. McGladrey & Pullen, LLP audited the Company's
financial statements for the fiscal year ended September 30, 2001.2002. The Company
expects that representatives of McGladrey & Pullen, LLP will be present at the
Annual Meeting, with the opportunity to make a statement if they so desire, and
will be available to respond to appropriate questions.
In the event that ratification of the appointment of McGladrey & Pullen,
LLP as the independent public accountants for the Company is not obtained at the
Annual Meeting, the Board of Directors will reconsider its appointment.
A majority of the shares represented, in person or by proxy, at the Annual
Meeting is required to ratify the appointment of the independent public
accountants.
The Board of Directors recommends that shareholders vote FOR the
ratification of McGladrey & Pullen, LLP as the independent public accountants
for the Company.
FEES OF INDEPENDENT AUDITORS
Audit Fees. McGladrey & Pullen, LLP billed the Company $81,225$97,360 in fees for
professional services rendered for the audit of the Company's financial
statements for the fiscal year ended September 30, 2001,2002, and for the review of
the interim financial statements in the Company's Quarterly Reports on Form
10-QSB during the fiscal year ended September 30, 2001.2002.
Financial Information Systems Design and Implementation Fees. McGladrey &
Pullen, LLP did not render any professional services to the Company for
information technology advice during the fiscal year ended September 30, 2001.2002.
All Other Fees. McGladrey & Pullen, LLP billed the Company $9,750$79,700 in fees
for all other professional services rendered to the Company during the fiscal
year ended September 30, 2001.2002. These services primarily consisted of tax
services.services, research regarding the accounting of stock options and fees related to
the Company's Form SB-2 Registration Statement filed with the Securities and
Exchange Commission in October 2002.
The Audit Committee of the Board of Directors of the Company considered
that the provision of the services and the payment of the fees described above
are compatible with maintaining the independence of McGladrey & Pullen, LLP.
87
DIRECTORS
The Board of Directors currently consists of eight members: O.B. Parrish,
William R. Gargiulo, Jr., Mary Ann Leeper, Ph.D., Stephen M. Dearholt, David R.
Bethune, Michael R. Walton, James R. Kerber and Richard E. Wenninger. At each
annual meeting of shareholders, directors are elected for a term of one year to
succeed those directors whose terms are expiring.
COMMITTEE OF THE BOARD OF DIRECTORS AND MEETING ATTENDANCE
The Company has an Audit Committee. The Board's Audit Committee is
comprised of Mr. Bethune, Mr. Dearholt and Mr. Kerber. The responsibilities of
the Audit Committee, in addition to such other duties as may be specified by the
Board of Directors, include the following: (a) recommendation to the Board of
Directors of independent auditors for the Company; (b) review of the timing,
scope and results of the independent auditors' audit examination; (c) review of
periodic comments and recommendations by the auditors and of the Company's
response thereto; (d) review of the Company's balance sheet, statement of
operations and cash flows; and (e) review of the scope and adequacy of internal
accounting controls. The Audit Committee met two timesone time during the fiscal year
ended September 30, 2001.2002.
The Board of Directors held 13eight meetings during the Company's fiscal year
ended September 30, 2001. Other2002. All of the incumbent directors other than Mr. Bethune
no incumbent director
attended fewer thanat least 75% of the aggregate of (a) the total number of meetings of
the Board of Directors and (b) the total number of meetings held by all
committees of the Board on which he or she served, if any.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee is comprised of three members of the Company's Board of
Directors. Because the Common Stock is traded on the Over the Counter Bulletin
Board, the Company is not subject to the listing requirements of any securities
exchange or Nasdaq regarding the membership of the Company's Audit Committee.
However, each member of the Audit Committee is independent as defined in Rule
4200(a)(14) for the listing standards of the Nasdaq Stock Market. The duties
and responsibilities of the Audit Committee does not have a written charter.are set forth in the Audit Committee
Charter, which has been adopted by the Board of Directors. A copy of the Audit
Committee Charter is attached as Annex A to this Proxy Statement.
8
The Audit Committee has:
- - reviewed and discussed the Company's audited financial statements for the
fiscal year ended September 30, 2001,2002, with the Company's management and
with the Company's independent auditors;
9
- - discussed with the Company's independent auditors the matters required to
be discussed by SAS 61 (Codification for Statements on Auditing Standards);
and
- - received and discussed with the Company's independent auditors the written
disclosures and the letter from the Company's independent auditors required
by Independence Standards Board Statement No. 1 (Independence discussions
with Audit Committees).
Based on such review and discussions with management and the independent
auditors, the Audit Committee recommended to the Board of Directors that the
audited financial statements be included in the Company's Annual Report on Form
10-KSB for the fiscal year ended September 30, 2001,2002, for filing with the
Securities and Exchange Commission.
AUDIT COMMITTEE:
David R. Bethune
Stephen M. Dearholt
James R. Kerber
DIRECTOR COMPENSATION AND BENEFITS
Directors who are officers of the Company do not receive compensation for
serving in such capacity. Individual directors who are not officers of the
Company receive $1,000 for attendance in person at each board meeting or meeting
of a committee of which he or she is a member. In addition, each director who
is not an employee of the Company receives an automatic grant of options to
purchase 30,000 shares Common Stock under the Company's Outside Director Stock
Option Plan. This grant is made upon the director's initial appointment to the
Board of Directors and the options vest in accordance with the vesting criteria
set forth in the plan.
9
EXECUTIVE OFFICERS
The names of, and certain information regarding, executive officers of the
Company who are not directors of the Company, are set forth below.
Name Age PositionNAME AGE POSITION
- ---- --- --------
Jack Weissman 54. . . 55 Vice President-Sales
Michael Pope 45Pope. . . . 46 Vice President and General Manager of The
Female Health Company (UK) Plc.
Mitchell Warren 35. . 36 Vice President-International Affairs
Robert R. Zic 38. . . 39 Principal Accounting Officer
10
JACK WEISSMAN
Age: 55; Vice President-Sales
Mr. Weissman has served as Vice President-Sales since June 1995. From 1992
to 1994, Mr. Weissman was Vice President-Sales for Capitol Spouts, Inc., a
manufacturer of pouring spouts for gable paper cartons. During the period fromFrom 1989 to 1992, he
acted as General Manager-HTV Group, an investment group involved in the
development of retail stores. Mr. Weissman joined Searle's Consumer Products
Group in 1979 and held positions of increasing responsibility, including
National Account and Military Sales Manager. From 1985 to 1989, he was
Director-Retail Business Development for The NutraSweet Company, a Searle
subsidiary. Prior to Searle, Mr. Weissman worked in the consumer products field
as account manager and territory manager for Norcliff Thayer and Whitehall
Laboratories.
10
MICHAEL POPE
Age: 46; Vice President, General Manager-The Female Health Company (UK) Plc.Plc
Mr. Pope has served as Vice President of the Company since 1996 and as
General Manager of The Female Health Company (UK) Plc. (formerly Chartex
International, Plc.) since the Company's 1996 acquisition of Chartex. Mr. Pope
has also served as a Director of The Female Health Company, Ltd. (formerly
Chartex Resources Limited) and The Female Health Company (UK) Plc. since 1995.
From 1990 until 1996, Mr. Pope was Director of Technical Operations for Chartex
with responsibility for manufacturing, engineering, process development and
quality assurance. Mr. Pope was responsible for the development of the high
speed proprietary manufacturing technology for the female condom and securing
the necessary approvals of the manufacturing process by regulatory
organizations, including the FDA. Mr. Pope was also instrumental in developing
and securing Chartex's relationship with its Japanese marketing partner. Prior
to joining Chartex, from 1986 to 1990, Mr. Pope was Production Manager and
Technical Manager for Franklin Medical, a manufacturer of disposable medical
devices. During the period fromFrom 1982 to 1986, Mr. Pope was Site Manager, Engineering and
Production Manager, Development Manager and Silicon Manager for Warne Surgical
Products.
MITCHELL WARREN
Age: 36; Vice President-International Affairs.Affairs
Mr. Warren has served as Vice President - InternationalPresident-International Affairs of the
Company since February 2000 and as Director of International Affairs of the
Company from January 1999 to February 2000. From 1993 to 1998, Mr. Warren was
employed by Population Services International (PSI), an international social
marketing and communications organization, first as Executive Director of
PSI/South Africa and then of PSI/Europe. From 1989 to 1993, Mr. Warren was
Program Director of Medical Education for South AfricanAfrica Blacks.
11
ROBERT R. ZIC
Age: 39; Principal Accounting Officer
Mr. Zic has served as the Principal Accounting Officer since March 1999.
From 1998 to 1999, Mr. Zic held the dual positions of Acting Controller and
Acting Chief Financial Officer at Ladbroke's Pacific Racing Association
division. From 1995 to 1998, Mr. Zic served as the Chief Accounting Manager and
Assistant Controller at Argonaut Insurance Company. In this capacity, he was
responsible for the financial and accounting operations of Argonaut and its four
subsidiaries. From 1990 to 1994, he was the Assistant Controller of CalFarm
Insurance Company, where he was responsible for the company's external reporting
duties. From 1988 to 1990, Mr. Zic was a Senior Accountant responsible for the
statutory-based financials of Allstate Insurance Company. Mr. Zic'sZic began his
career
began in 1986 as an auditor with Arthur Andersen & Co.
11
EXECUTIVE COMPENSATION
The following table sets forth the annual and long-term compensationbelow gives information for each of the Company's last three
fiscal years forregarding all annual, long-term and other compensation paid by the
Company's Chief Executive OfficerCompany to its chief executive officer and the only executive officer of the Company who receivedwhose
total annual salary and bonus in
excess ofexceeded $100,000 for services rendered during the
fiscal year ended September 30, 2001 (the2002. The individuals listed in this table are
referred to elsewhere in this report as the "named executive officers").
12
officers."
SUMMARY COMPENSATION TABLE
LONG-TERM
ANNUAL LONG-TERM COMPENSATION COMPENSATION AWARDS
------------ ----------------------------------------------- -------------------
RESTRICTED
STOCK SECURITIES
FISCAL SALARY AWARDSSTOCK UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY ($) AWARDS ($) OPTIONS/SARS (#)
- --------------------------- ------------ ------------------ ---------- ---------- ----------------
O.B. Parrish Chairman . . . 2002 90,000 277,800 (1)(2) __
and Chief Executive . . . . 2001 90,000 - -
Chairman and Chief__ __
Officer . . . . . . . . . . 2000 90,000 - -
Executive Officer 1999 90,000 - 200,000__ __
Mary Ann Leeper, Ph.D. 2001Ph.D.. . . 2002 225,000 - -432,875 (1)(2) __
President and Chief . . . . 2001 225,000 __ __
Operating Officer . . . . . 2000 225,000 - -
Operating Officer 1999 225,000 - 500,000
- --------------------------- ------------ ------------ ---------- ----------------__ __
_______________
(1) On September 26, 2002, Mr. Parrish and Dr. Leeper were issued 116,000 and
197,500 shares, respectively, of restricted Common Stock in exchange for
the cancellation of their stock options. All of the restricted stock vests
on September 26, 2003. The closing price of the Company's Common Stock on
September 26, 2002 was $2.05 per share. As of September 30, 2002, the value
of Mr. Parrish's restricted Common Stock was $229,680 and the value of Dr.
Leeper's restricted Common Stock was $391,050 based on a value of $1.98 per
share, the closing price of the Company's Common Stock on that date.
(2) On February 12, 2003, Mr. Parrish and Dr. Leeper were issued 40,000 and
28,000 shares, respectively, of restricted Common Stock in connection with
compensation earned in fiscal year 2002.
OPTION GRANTS DURING THE YEAR ENDED SEPTEMBER 30, 20012002
No stock options were granted to the named executive officers of the
Company during the fiscal year ended September 30, 2001.
AGGREGATED OPTION2002.
12
FISCAL YEAR-END OPTION/SAR VALUES
AT SEPTEMBER 30, 2001
The following table presents the valueEffective September 26, 2002, each of unexercised options held by the named executive officers agreed
to exchange all of their outstanding stock options for (i) the number of shares
of restricted Common Stock equal to 25% of the old options being exchanged and
(ii) the right to receive new options to purchase the number of shares of Common
Stock equal to 100% of the old options being exchanged on the first business day
that is at least six months and one day after the effective date of the
exchange. As a result, the named executive officers do not hold any stock
options as of September 30, 2001:
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AT SEPTEMBER 30, 2001 AT SEPTEMBER 30, 2001 (1)
------------------------------ ---------------------------
NAME EXERCISABLE / UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- ---------------------- ------------------------------ ---------------------------
O.B. Parrish 0 / 464,000 (2) $ 0/0
Mary Ann Leeper, Ph.D. 0 / 790,000 (2) $ 0/0
- ---------------------- ------------------------------ ---------------------------
(1) Values are calculated by subtracting the exercise price from the $0.51 per
share closing price of the Common Stock on September 28, 2001.
13
(2) In September 2001, Mr. Parrish and Dr. Leeper each agreed to waive their
rights to exercise outstanding options until the Company amends its Amended
and Restated Articles of Incorporation to increase the number of shares of
Common Stock authorized for issuance. As of September 30, 2001, Mr. Parrish
held options to purchase 88,000 shares of Common Stock that were
exercisable but for the effect of his waiver and Dr. Leeper held options to
purchase 96,667 shares of Common Stock that were exercisable but for the
effect of her waiver. In consideration for these waivers, the Company
agreed to reduce the exercise price of such options to $0.56 per share.
2002.
EMPLOYMENT AGREEMENTS
The Company entered into an employment agreement with Dr.Mary Ann Leeper
effective May 1, 1994. The original term of Dr. Leeper's employment extended to
April 30, 1997 and after April 30, 1997 her employment term renews automatically
for additional three-year terms unless notice of termination is given. The
employment agreement has automatically renewed for a term ending on April 30,
2003. The Company may terminate the employment agreement at any time for cause.
If Dr. Leeper is terminated without cause, the Company is obligated to continue
to pay Dr. Leeper her base salary and any bonus to which she would otherwise
have been entitled for a period equal to the longer of two years from date of
termination or the remainder of the then applicable term of the employment
agreement. In addition, the Company is obligated to continue Dr. Leeper's
participation in any of its health, life insurance or disability plans in which
Dr. Leeper participated prior to her termination of employment. Dr. Leeper's
employment agreement provided for a base salary of $175,000 for the first year
of her employment term, $195,000 for the second year of her employment term and
$225,000 for the third year of her employment term, subject to the achievement
of performance goals established by Dr. Leeper and the Board of Directors. If
the employment agreement is renewed beyond the initial three-year term, it
requires her base salary to be increased annually by the Board of Directors
based upon her performance and any other factors that the Board of Directors
considers appropriate. For fiscal 2000, 2001 and 2001,2002 Dr. Leeper's base salary
was $225,000 per year. The employment agreement also provides Dr. Leeper with
various fringe benefits including an annual cash bonus of up to 100% of her base
salary. The Board of Directors may award the cash bonus to Dr. Leeper in its
discretion. To date, Dr. Leeper has not been awarded a cash bonus.
14
CHANGE OF CONTROL AGREEMENTS
In fiscal 1999, the Company entered into Change of Control Agreements with
each of O.B. Parrish, the Company'sits Chairman and Chief Executive Officer, Mary Ann Leeper,
the Company'sits President and Chief Operating Officer, and Michael Pope, the Company'sits Vice President.
In fiscal 2000, the Company entered into a Change of Control Agreement with
Mitchell Warren, the Company's Vice-President-International Affairs. These
agreements essentially act as springing employment agreements which provide
that, upon a change of control, as defined in the agreement, the Company will
continue to employ the executive for a period of three years in the same
capacities and with the same compensation and benefits as the executive was
receiving prior to the change of control, in each case as specified in the
agreements. If the executive is terminated without cause or if he or she quits
for good reason, in each case as defined in the agreements, after the change of
control, the executive is generally entitled to receive a severance payment from
the Company equal to the amount of compensation remaining to be paid to the
executive under the agreement for the balance of the three-year term.
13
SECURITY OWNERSHIP
The following table sets forth certain information regarding beneficial ownership
of the Company's Common Stock as of December 20, 20012003 with respect to (a) each
person known to the Company to own beneficially more than 5% of the Company's
Common Stock, (b) each named executive officer (c)and each director of the Company
and (d)(c) all directors and executive officers as a group.
The Company has determined beneficial ownership in accordance with the
rules of the Securities and Exchange Commission (the "SEC").SEC. Unless otherwise indicated, the persons and entities included
in the table have sole voting and investment power with respect to all shares
beneficially owned, except to the extent authority is shared by spouses under
applicable law. Shares of the Company's Common Stock subject to options or
warrants that are either currently exercisable or exercisable within 60 days of
December 20, 2001,2002, and shares of the Company's Common Stock subject to the
conversion of preferred stock or convertible debentures outstanding as of December 20, 2001,2002, are
treated as outstanding and beneficially owned by the holder for the purpose of
computing the percentage ownership of the holder. However, these shares are not
treated as outstanding for the purpose of computing the percentage ownership of
any other person.
AMOUNT OF BENEFICIAL
OWNERSHIP
---------------------SHARES BENEFICIALLY OWNED
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES(1) NUMBER PERCENT
- ------------------------------------------------ --------- -------------------------------------------------- ------ -------
O.B. Parrish (1) (2) 832,501 5.1%. . . . . . . . . . . . . . . . 978,501 5.2%
William R. Gargiulo, Jr. (1) (2) 335,001. . . . . . . . . . 390,001 2.1%
Mary Ann Leeper, Ph.D. (1) (2) 370,901 2.3%. . . . . . . . . . . 598,401 3.2%
Stephen M. Dearholt (2) (3) 4,101,612 22.1%. . . . . . . . . . . . . 4,435,305 20.8%
David R. Bethune (2) 0 0%. . . . . . . . . . . . . . . . 32,500 *
James R. Kerber (2) (4) 543,710 3.4%. . . . . . . . . . . . . . . 563,710 3.0%
Michael R. Walton (5) 509,000 3.1%. . . . . . . . . . . . . . 692,566 3.8%
Richard E. Wenninger (6) 3,361,470 19.2%. . . . . . . . . . . . 3,418,192 17.1%
Gary Benson (7) 1,701,450 9.8%. . . . . . . . . . . . . . . . . 1,429,166 7.3%
All directors, nominees and executive officers,
as a group (12 persons) (1)(2)(3)(4)(5)(6) 9,420,193 44.4%
- ------------------------------------------------ --------- ----------
15. . . . 10,652,231 44.9%
_______________
* Less than 1 percent.
(1) Unless otherwise indicated, the address of each beneficial owner is 515
North State Street, Suite 2225, Chicago, IL 60610; the address of Mr.
Dearholt is 759 North Milwaukee Street, Suite 316, Milwaukee, WI 53202; the
address of Mr. Kerber is 8547 East Arapahoe Road, #J217, Englewood, CO
80112; the address of Mr. Walton is 1626 North Prospect Avenue, No. 2310,
Milwaukee, WI 53202; the address of Mr. Wenninger is 855 West Dean Road,
Milwaukee, WI 53217; and the address of Mr. Benson is Regency Athletic
Club, 1300 Nicollet Mall, Suite 600, Minneapolis, MN 55403.
10
14
(1)(2) Includes 294,501 shares owned by and 30,00060,000 shares under option to Phoenix
of Illinois. Under the rules of the SEC, Messrs. Parrish and Gargiulo and
Dr. Leeper may be deemed to share voting and dispositive power as to such
shares since Mr. Gargiulo is a trustee of a trust which is a shareholder,
and Mr. Parrish and Dr. Leeper are officers, directors and shareholders, of
Phoenix of Illinois. For Dr. Leeper, also includes 46,400243,900 shares owned by
her; for Mr. Parrish, also includes 71,500187,500 shares owned by him, 36,500
shares under warrants to him and 400,000 shares under warrants held by the
Geneva O. Parrish 1996 Living Trust of which Mr. Parrish is beneficiary and
for which Mr. Parrish may be deemed to share voting and investment power;
and for Mr. Gargiulo, also includes 10,50035,500 shares owned by him.
(2) Does not include the following shares under options that were exercisable
but for the effect of a waiver by the holder of his or her rights to
exercise such options until the Company amends its Amended and Restated
Articles of Incorporation to increase the number of shares of Common Stock
authorized for issuance: Mr. Parrish, 88,000 shares under such options; Mr.
Gargiulo, 16,667 shares under such options; Dr. Leeper, 96,667 shares under
such options; Mr. Dearholt, 50,000 shares under such options; Mr. Bethune,
50,000 shares under such options; Mr. Kerber, 30,000 shares under such
options; and all directors, nominees and executive officers as a group,
331,334 shares under such options. In consideration for these waivers, the
Company agreed to reduce the exercise price of such options to $0.56 per
share.
(3) Includes 703,605704,405 shares owned directly by Mr. Dearholt. Also includes
69,500 shares held by the Dearholt, Inc. Profit Sharing Plan, 9,680 shares
held by Response Marketing Money Purchase Plan, 13,70017,200 shares held in a
self-directed IRA, 186,427275,820 shares held by the Mary C. Dearholt Trust of
which Mr. Dearholt, a sibling and his mother are trustees, 18,100 shares
held by Mr. Dearholt's minor child, and 418,100 shares held by the John W.
Dearholt Trust of which Mr. Dearholt is a co-trustee with a sibling, and
60,000 shares of preferred stock held by the Mary C. Dearholt Trust, of
which Mr. Dearholt, a sibling and his mother are trustees, that are
convertible share-for-share into shares of Common Stock.sibling. Mr.
Dearholt shares the power to vote and dispose of 640,998693,920 shares of Common
Stock
(including 60,000 shares of preferred stock convertible into Common Stock) held by the Mary C. Dearholt Trust and the John W. Dearholt Trust.
Mr. Dearholt has sole power to vote and dispose of the remaining shares of
Common Stock, except that North Central Trust has the sole power to vote
and dispose of the 9,680 shares of Common Stock held by the Response
Marketing Money Purchase Plan. Also includes warrants to purchase 2,622,5002,922,500
shares of Common Stock (of which warrants to purchase up to 1,100,000
shares have been pledged to a bank to secure a guarantee by Mr. Dearholt on
behalf of the Company).
16
(4) Includes 200,000 shares subject to exercise of warrants. The warrants have
been pledged to a bank to secure a guarantee by Mr. Kerber on behalf of the
Company.
(5) Includes 200,000Consists of 492,058 shares of Common Stock owned directly by Mr. Walton,
173,03030,900 shares subject to exercise of preferred stock ownedwarrants held by Mr. Walton, and
135,970169,608 shares of preferred stockCommon Stock held by a trust of which Mr. Walton is
trustee.
(6) Includes (a) 500,000 shares of Common Stock subject to conversion of a
convertible debenture due March 30, 2004 (based upon $250,000 of principal
under such convertible debenture, divided by the conversion rate of $0.50),
(b) 5,000 shares of Common Stock held by Mr. Wenninger's spouse (Mr.
Wenninger disclaims beneficial ownership of the shares held by his spouse),
and (c) 1,100,000 shares of Common Stock subject to exercise of warrants,
consisting of a warrant to purchase 100,000 shares and a warrant to
purchase a maximum of 1,000,000 shares and (d) 60,000 shares of preferred
stock held by Mr. Wenninger.shares. The warrants described in (c) above
have been pledged to a bank to secure a guarantee by Mr. Wenninger on
behalf of the Company.
(7) Includes warrants to purchase 1,500,000Consists of 329,166 shares of Common Stock and 21,000warrants to purchase
1,100,000 shares of preferred stock.Common Stock owned by Goben Enterprises, LP, a limited
partnership of which Mr. Benson is a general partner.
15
The above beneficial ownership information is based on information
furnished by the specified person and is determined in accordance with Rule
13d-3 under the Securities Exchange Act of 1934, as amended, as required for
purposes of this Proxy Statement. This information should not be construed as
an admission of beneficial ownership for other purposes.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of a registered class
of the Company's equity securities, to file reports of ownership and changes in
ownership with the SEC on Form 3, 4 and 5. Officers, directors and greater than
10% stockholders are required by SEC regulation to furnish the Company with
copies of all Forms 3, 4 and 5 they file.
Based solely on review of the copies of such forms furnished to the
Company, or written representations that no Forms 5 were required, the Company
believes that during fiscal 20012002 all section 16(a) filing requirements
applicable to its officers, directors and greater than 10% beneficial owners
were complied with, except thatthat: Mr. WenningerParrish filed a Form 3 in August 20014 on December 26,
2002 to report his beneficial ownership of more than 10% of the Common Stock as of May
2001,four transactions occurring on September 26, 2002; Dr. Leeper
filed a Form 4 in November 2001on December 26, 2002 to report three transactions occurring on
September 26, 2002; Mr. Gargiulo filed a transaction
completed inForm 4 on December 26, 2002 to report
two transactions occurring on September 2001 and26, 2002; Mr. Bethune filed a Form 4 on
December 26, 2002 to report three transactions occurring on September 26, 2002;
Mr. Dearholt filed a Form 5 in4 on December 17, 2002 to report one transaction
occurring on September 20, 2002, three transactions occurring on September 26,
2002 and one transaction occurring on November 200122, 2002; Mr. Kerber filed a Form
4 on December 26, 2002 to report two transactions occurring on September 26,
2002; Mr. Walton filed a Form 4 on December 26, 2002 to report a transaction
occurring on September 19, 2002, two transactions occurring on September 20,
2002 and one transaction occurring on September 26, 2002; Mr. Wenninger filed a
Form 4 on January 2, 2002 to report a transaction occurring on November 29,
2001, a Form 4 on December 26, 2002 to report a transaction occurring on
September 20, 2002 and a Form 4 on February 14, 2003 to report a transaction
occurring on January 12, 2003; Mr. Weissman filed a Form 4 on December 26, 2002
to report three transactions occurring on September 26, 2002 and filed a Form 4
on January 6, 2003 to report one transaction occurring on November 20, 2002, one
transaction occurring on November 22, 2002 and one transaction occurring on
November 27, 2002; Mr. Pope filed a Form 4 on December 26, 2002 to report three
transactions occurring on September 26, 2002; and Mr. Warren filed a Form 4 on
January 6, 2003 to report a transaction occurring on November 19, 2002, filed a
Form 4 on January 28, 2003 to report four transactions, two of which occurred on
January 10, 2003, one on January 13, 2003 and one on January 15, 2003, and also
filed a Form 4 report on February 5, 2003 to report six transactions, one on
January 2, 2003, one on January 29, 2003, three on January 30, 2003 and one on
January 31, 2003.
16
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On February 18, 1999, the Company borrowed $50,000 from O.B. Parrish, its
Chairman and Chief Executive Officer. The borrowing was completed through the
execution of a $50,000, one-year promissory note payable by the Company to Mr.
Parrish and a Note Purchase and Warrant Agreement and Stock Issuance Agreement.
Mr. Parrish was granted warrants to purchase 10,000 shares of the Company's
Common Stock at an exercise price of $1.35 per share. The exercise price of the
warrants equaled 80% of the average market price of the Company's Common Stock
for the five trading days prior to the date of issuance. The warrants expire
upon the earlier of their exercise or nine years after the date of their
issuance. Effective February 18, 2000, the Company extended the due date of the
note to February 18, 2001, and in August 2001.connection with this extension, the Company
issued to Mr. Parrish warrants to purchase 12,500 shares of the Company's Common
Stock at an exercise price of $0.72 per share, which equaled 80% of the average
market price of the Company's Common Stock for the five trading days prior to
the date of issuance. Effective February 18, 2001, the Company extended the due
date of the note to February 18, 2002, and in connection with this extension,
the Company issued to Mr. Parrish warrants to purchase 14,000 shares of the
Company's Common Stock at an exercise price of $0.40 per share, which equaled
75% of the average market price of the Company's Common Stock for the fair
trading days prior to the date of issuance. The warrants expire upon the
earlier of their exercise or ten years after the date of their issuance. The
Company also granted Mr. Parrish securities registration rights for any Common
Stock he receives from the Company under these warrants or the Stock Issuance
Agreement. The Company subsequently repaid this note in full.
On February 12, 1999, the Company borrowed $250,000 from Mr. Dearholt. The
borrowing was completed through the execution of a $250,000, one-year promissory
note payable by the Company to Mr. Dearholt. As part of this transaction, the
Company entered into a Note Purchase and Warrant Agreement and a Stock Issuance
Agreement. Mr. Dearholt received a warrant to purchase 50,000 shares of the
Company's Common Stock at an exercise price of $1.248 per share. The exercise
price of the warrants equaled 80% of the average market price of the Company's
Common Stock for the five trading days prior to the date of issuance. The
warrants expire upon the earlier of their exercise or nine years after the date
of their issuance. Effective February 12, 2000, the Company extended the due
date of the note to February 12, 2001, and in connection with this extension,
the Company issued to Mr. Dearholt warrants to purchase 62,500 shares of the
Company's Common Stock at an exercise price of $0.77 per share, which equaled
80% of the average market price of the Company's Common Stock for the five
trading days prior to the date of issuance. Effective February 12, 2001, the
Company extended the due date of the note to February 12, 2002, and, in
connection with this extension, the Company issued to Mr. Dearholt warrants to
purchase 70,000 shares of the Company's Common Stock at an exercise price of
$0.40 per share, which equaled 75% of the average market price of the Company's
Common Stock for the five trading days prior to the date of issuance. The
warrants expire upon the earlier of their exercise or ten years after the date
of their issuance. The Company also granted Mr. Dearholt securities
registration rights for any Common Stock he receives from the Company under
these warrants or the Stock Issuance Agreement. The Company subsequently repaid
this note in full.
17
CERTAIN TRANSACTIONS
On March 25, 1997, 1998, 1999, 2000, 2001 and 20012002, the Company extended a
$1 million, one-year promissory note payable by the Companyit to Stephen M.Mr. Dearholt a current director of the Company, in connection withfor a
previous loan Mr. Dearholt made to the Company. The promissory note is now
payable in full on March 25, 20022003 and bears interest at 12% per annumannually, payable
monthly. The borrowing transactions were effected in the form of a promissory
note from the Company to Mr. Dearholt and related Note Purchase and Warrant
Agreements and a Stock Issuance Agreements.Agreement. Under the 1997, 1998 and 1999 Note
Purchase and Warrant Agreements, the Company issued to Mr. Dearholt warrants to
purchase 200,000 shares of the Company's Common Stock for eachin 1997 at an exercise
price of $1.848 per share, 200,000 shares of Common Stock in 1998 at an exercise
price of $2.25 per share and 200,000 shares of the three years respectively,Company's Common Stock in
1999 at an exercise pricesprice of $1.848, $2.25 and $1.16 per share, respectively.share. In 2000,connection with the extension
of the note to March 25, 2001, the Company issued to Mr. Dearholt warrants to purchase 250,000280,000
shares of the Company's Common Stock in 2000 at an exercise price of $0.71 per
share. In 2001,connection with the extension of the note to March 25, 2002, the
Company issued to
Mr. Dearholt warrants to purchase 280,000 shares of the Company's Common Stock
in 2001 at an exercise price of $0.40 per share. In connection with the
extension of the note to March 25, 2003, the Company issued warrants to purchase
300,000 shares of the Company's Common Stock in 2002 at an exercise price of
$1.18 per share. In each case, the exercise price of the warrants equaled 80% of
the market price of the Company's Common Stock on the date of issuance. The
warrants expire upon the earlier of their exercise or on March 25, 2005 for the
warrants issued in 1997, March 25, 2007 for the warrants issued in 1998, March
25, 19982009 for the warrants issued in 1999, March 25, 2010 for the warrants issued
in 2000, and March 25, 2011 for the warrants issued in 2001.2001 and March 25, 2014 for
the warrants issued in 2002. Under the Stock Issuance Agreements,Agreement, if the Company
fails to pay the $1 million under the note when due, the Company must issue
280,000200,000 shares of the Company's Common Stock to Mr. Dearholt. This issuance will
not, however, alleviate the Company from itsCompany's liability under the note. The Company also
granted Mr. Dearholt certain securities registration rights with respect tofor any Common Stock he
receives from the Company under these warrants or the Stock Issuance Agreement. Mr. Dearholt has agreed that, if the Company requests, he
will extend the promissory note for an additional one-year term to be due and
payable on March 25, 2003 upon the same terms as the prior note extension.
Additionally, during 2000 and 2001 the Company extended notes of $250,000
from Stephen M. Dearholt and $50,000 from O.B. Parrish, each a current director
of the Company. Each note payable bears interest at 12% and was payable in full
in 2002. As part of the 2000 renewal, the Company issued Mr. Dearholt and Mr.
Parrish warrants to purchase 62,500 and 12,500 shares of Common Stock at $0.77
and $0.72 per share, respectively. As part of the 2001 renewal, the Company
issued Mr. Dearholt and Mr. Parrish warrants to purchase 70,000 and 14,000
shares of Common Stock at $0.40 and $0.40 per share, respectively. Any stock
issued under the warrants carry certain registration rights. The warrants
expire in 2011. Each of these notes was subsequently paid off in June 2001.
18
On June 14, 2000, the Company completed a private placement of 400,000
shares of Common Stock to The John W. Dearholt Trust at a price of $0.50 per
share, representing a discount of 6% from the closing price of the Common Stock
on the Over the Counter Bulletin Board on that date. Stephen M. Dearholt is a
co-trustee of this trust. As part of this private placement, the Company
granted the investor registration rights which require that the Company register
the investor's resale of those shares.
The Company entered into a loan agreement on May 18, 2001, providing for a
three-year loan commitment from a bank of up to $2,000,000. The Company may
borrow under this loan agreement from time to time subject to a number of
conditions, including obtaining personal guarantees of 125% of the amount
outstanding under the loan. In May 2001, the Company borrowed a total of $1.5
million under this loan agreement. Five persons provided guarantees equal in
total to the $1.5 million outstanding under the loan. The guarantors included
James R. Kerber, a member of the Company's board of directors, Stephen M.
Dearholt, a member of the Company's board of directors, Richard E. Wenninger, a
member of the Company's board of directors, and a trust for the benefit of O.B.
Parrish.Parrish, the Company's Chairman of the Board and Chief Executive Officer. Each
guarantor may be liable to the lender for up to 125% of the guarantor's
guarantee amount if the Company defaults under the loan. The Company issued
warrants to the guarantors to purchase the number of shares of the Company's
Common Stock equal to the guarantee amount of such guarantor divided by the
warrant purchase price as of the date of exercise. The warrant purchase price
is the price per share equal to 70% of the market price of the Company's Common
Stock at the time of exercise, but in no event will the warrant purchase price
be less than $0.50 per share or more than $1.00 per share. The Company also
issued additional warrants to purchase 100,000 shares of the Company's Common
Stock at an exercise price of $0.50 per share to each of Stephen M. Dearholt and
Richard E. Wenninger because each of them guaranteed $500,000 under the loan.
The Company granted all of the guarantors registration rights which require that
the Company register the shares of Common Stock underlying the warrants.
18
Effective March 30, 2001, the Company issued a $250,000 convertible
debenture to Richard E. Wenninger. Mr. Wenninger subsequently became a member
of the Company's boardBoard of directorsDirectors in July 2001. The convertible debenture
bears interest at 12% per annumyear and has a three-year term. Mr. Wenninger may
convert the convertible debenture into Common Stock at any time based on a
conversion rate of $0.50 per share.
In August 2001, the Company issued 1,000,000 shares of Common Stock to
Richard E. Wenninger for a total purchase price of $500,000. The Company
granted Mr. Wenninger registration rights which require that the Company
register the shares of Common Stock it issued to Mr. Wenninger.
19
During fiscal 2001, the Company's Board of Directors of the Company elected to extend the
terms of warrants held by Mr. Dearholt, consisting of warrants issued in 1995
and 1996 to purchase a total of 240,000 shares of the Company's Common Stock at
exercise prices between $3.00 and $3.10, for an additional five years.
During fiscal 2002, the Company's Board of Directors elected to extend the
terms of warrants held by Mr. Walton, consisting of warrants issued in 1997 to
purchase 30,900 shares of the Company's Common Stock at an exercise price of
$2.50, for an additional four years.
During September 2002, the Company offered the holders of the its
outstanding preferred stock the right to convert their shares of preferred stock
into shares of Common Stock based on a price of $1.80 per share, the closing
price of the Common Stock on September 4, 2002. This resulted in a conversion
rate of approximately 1.39 shares of Common Stock per share of preferred stock
rather than the 1 to 1 conversion rate set forth in the Company's Articles of
Incorporation. Effective September 20, 2002, a total of 594,000 shares of
Series 1 Preferred Stock were converted into a total of 824,911 shares of Common
Stock. 309,000 shares of preferred stock beneficially owned by Mr. Walton were
converted into 429,166 shares of Common Stock and 60,000 shares of preferred
stock beneficially owned by Mr. Wenninger were converted into 83,333 shares of
Common Stock.
It has been and currently is the policy of the Company that transactions
between the Company and its officers, directors, principal shareholders or
affiliates are to be on terms no less favorable to the Company than could be
obtained from unaffiliated parties. The Company intends that any future
transactions between the Company and its officers, directors, principal
shareholders or affiliates will be approved by a majority of the directors who
are not financially interested in the transaction.
19
INDEPENDENT ACCOUNTANTS
For the fiscal year endingended September 30, 2001,2002, McGladrey & Pullen, LLP
served as the Company's independent auditors.
PROPOSALS FOR 20012004 ANNUAL MEETING
Any shareholder who desires to submit a proposal for inclusion in the
Company's 20032004 Proxy Statement should submit the proposal in writing to Mr. O.B.
Parrish, Chief Executive Officer, The Female Health Company, 515 North State
Street, Suite 2225, Chicago, Illinois, 60610. The Company must receive a
proposal by October 9, 200223, 2003 in order to consider it for inclusion in the
Company's 20032004 Proxy Statement. Any shareholder who intends to present a
proposal at the 20032004 Annual Meeting of Shareholders without inclusion of such
proposal in the Company's proxy materials are required to provide notice of such
proposal to the Company no later than December 23, 2002.January 15, 2004.
ANNUAL REPORT
The Company is required to file an Annual Report, called a Form 10-KSB,
with the SEC. A copy of the Annual Report on Form 10-KSB for the year ended
September 30, 20012002 will be provided without charge on written request of any
shareholder whose proxy is being solicited by the Board of Directors. The
written request should be directed to: Corporate Secretary, The Female Health
Company, 515 North State Street, Suite 2225, Chicago, Illinois 60610.
20
EXPENSES OF SOLICITATION
The cost of this solicitation of proxies will be paid by the Company. It
is anticipated that the proxies will be solicited only by mail, except that
solicitation personally or by telephone may also be made by the Company's
regular employees who will receive no additional compensation for their services
in connection with the solicitation. Arrangements will be made with brokerage
houses and other custodians, nominees and fiduciaries for the forwarding of
solicitation material and annual reports to beneficial owners of stock held by
such persons. The Company will reimburse such parties for their expenses in so
doing.
By Order of the Board of Directors,
William R. Gargiulo, Jr.,
Secretary
Chicago, Illinois
February 6, 2002
2119, 2003
20
PROXYANNEX A
CHARTER FOR THE FEMALE HEALTH COMPANY
THIS PROXY IS SOLICITED ON BEHALFAUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
OF THE FEMALE HEALTH COMPANY
PURPOSE:
- -------
The undersigned hereby appoints O.B. ParrishAudit Committee is appointed by the Board of Directors to monitor the
corporate financial reporting and William R. Gargiulo, Jr.,
or either one of them, each with full power of substitutionthe internal and resubstitution,
as proxy or proxies of the undersigned to attend the Annual Meeting of
Shareholdersexternal audits of The Female
Health Company (the "Company"). The Audit Committee is directly responsible for
the appointment, compensation and oversight of the work of the Company's
independent auditors, including the resolution of disagreements between
management and the auditor regarding financial reporting. The Audit Committee
shall assist the Board of Directors with oversight of (i) the integrity of the
Company's financial statements; (ii) the Company's compliance with legal and
regulatory requirements; (iii) the independent auditor's qualifications and
independence and (iv) the performance of the Company's internal audit function
and independent auditors.
In addition, the Audit Committee will undertake those specific duties and
responsibilities listed below and such other duties as the Board of Directors
from time to time prescribe.
The function of the Audit Committee is oversight. The management of the
Company is responsible for the preparation, presentation and integrity of the
Company's financial statements. Management is responsible for maintaining
appropriate accounting and financial reporting principles and policies and
internal controls and procedures designed to assure compliance with accounting
standards and applicable laws and regulations. The independent auditors are
responsible for planning and carrying out a proper audit and reviews, including
reviews of the Company's quarterly financial statements prior to the filing of
each quarterly report on Form 10-Q, and other procedures. In fulfilling their
responsibilities under this charter, it is recognized that members of the Audit
Committee are not full-time employees of the Company and are not, and do not
represent themselves to be, held ataccountants or auditors by profession or experts in
the Renaissance Chicago
Hotel, Rhine Room, Third Floor, One West Wacker Drive, Chicago, IL 60601-1802 on
March 15, 2002 at 2:00 p.m., local time,fields of accounting or auditing. As such, it is not the duty or
responsibility of the Audit Committee or its members to conduct auditing or
accounting reviews or procedures, and at any adjournment thereof, there
to vote all shareseach member of Common Stock and Class A Convertible Preferred Stock -
Series 1 which the undersigned wouldAudit Committee shall
be entitled to voterely on (a) the integrity of those persons and organizations
within and outside the Company from whom it receives information and (b) the
accuracy of the financial and other information provided to the Audit Committee
by such persons or organizations.
21
The independent auditors for the Company are ultimately accountable to the
Audit Committee and the Board of Directors. The Audit Committee has the direct
authority and responsibility to select, evaluate and, where appropriate, replace
the independent auditors (or to nominate the independent auditors to be proposed
for shareholder approval in the proxy statement). The Company shall provide the
Audit Committee with appropriate funding for payment of compensation, fees and
expenses to the independent auditors and to counsel or other advisors that the
Audit Committee may deem appropriate to engage.
MEMBERSHIP:
- ----------
The Audit Committee will consist of at least three members, each of whom
shall not be an officer of the Company or its subsidiaries, shall not have any
relationship which, in the opinion of the Board of Directors, would interfere
with the exercise of independent judgment in carrying out the responsibilities
of a director. One member of the Audit Committee shall be a "financial expert"
as may be defined by the rules of the Securities and Exchange Commission.
RESPONSIBILITIES:
- ----------------
The responsibilities of the Audit Committee shall include:
1. Reviewing on a continuing basis the adequacy of the Company's system of
internal controls and the Company's disclosure controls and procedures;
2. Reviewing on a continuing basis the activities, organizational structure
and qualifications of the Company's internal audit function;
3. Reviewing the independent auditors' proposed audit scope and approach;
4. Reviewing with management and the independent auditors the audited
financial statements and audit findings, including any significant
suggestions for improvements provided to management by the independent
auditors and any serious difficulties or disputes with management
encountered during the course of the audit, and reviewing the other
financial disclosures in the Company's Form 10-K report, including
Management's Discussion and Analysis of Financial Condition and Results of
Operations;
5. Reviewing with management and the independent auditors the Company's
unaudited quarterly financial statements prior to the filing of its Form
10-Q, including the results of the independent auditors' reviews of the
quarterly financial statements, and reviewing the financial disclosures in
the Form 10-Q, including Management's Discussion and Analysis of Financial
Condition and Results of Operations;
22
6. Approving the appointment of the independent auditors, subject, if
personally presentapplicable, to stockholder ratification;
7. Approving fee arrangements with the independent auditors;
8. Reviewing the performance and qualifications of the independent auditors
and reviewing the experience and qualifications of the senior members of
the independent auditor team, compliance by the independent auditors with
audit partner rotation requirements and the quality control procedures of
the independent auditors;
9. Approving in advance the retention of the independent auditor firm for any
non-audit service that such firm is not prohibited from performing for the
Company and approving the fees for any such service;
10. Ensuring that the independent auditors prepare and deliver annually a
Statement as specified uponto Independence (it being understood that the followingindependent
auditors are responsible for the accuracy and completeness of this
Statement), and discussing with the independent auditors any relationships
or services disclosed in this Statement that may impact the objectivity and
independence of the Company's independent auditors and to recommend that
the Board of Directors take appropriate action in response to this
Statement to satisfy itself of the independent auditors' independence;
11. Reviewing reports from the independent auditors regarding (a) critical
accounting policies used by the Company in its financial statements, (b)
all alternative treatments of financial information within generally
accepted accounting principles that the independent auditors have discussed
with management, ramifications of the use of such alternative treatments
and the treatment preferred by the independent auditors, and (c) other
material written communications between the independent auditors and
management;
12. Recommending to the Board of Directors guidelines for hiring of employees
of the independent auditor who have been engaged on the Company's account;
13. Advising the Board of Directors with respect to the Company's policies and
procedures regarding compliance with applicable laws and regulations;
14. Reviewing with management and the independent auditors the effect of any
significant regulatory and accounting initiatives;
23
15. Obtaining from the independent auditors assurance that Section 10A of the
Securities Exchange Act of 1934 has not been implicated;
16. Meeting at least quarterly with management and the independent auditors in
separate executive sessions;
17. Reviewing, in conjunction with counsel, any legal matters that could have a
significant impact on the Company's financial statements;
18. Providing oversight and review of the Company's asset management policies,
including an annual review of the Company's investment policies and
performance for cash and short-term investments, and the Company's risk
assessment and risk management policies;
19. If necessary, instituting special investigations and, if appropriate,
hiring special counsel or experts to assist;
20. Reviewing related party transactions for potential conflicts of interest
and approving related party transactions;
21. Establishing procedures for the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal
accounting controls or auditing matters and for the confidential, anonymous
submission by employees of the Company or its subsidiaries of concerns
regarding questionable accounting or auditing matters;
22. Performing other oversight functions as requested by the full Board of
Directors;
23. Reviewing and updating the Audit Committee's charter annually and
recommending any proposed changes to the Board of Directors for approval;
24. Instructing the independent accountants that the independent accountants
are ultimately responsible to the Board of Directors and the Audit
Committee; and
25. Preparing any report, including any report of the Audit Committee required
by the rules of the Securities and Exchange Commission to be included in
their discretion uponthe proxy statement for the Company's annual meeting.
In addition to the above responsibilities, the Audit Committee will
undertake such other mattersduties as the Board of Directors delegates to it, and will
report regularly to the Board regarding the Committee's examinations and
recommendations.
24
MEETINGS:
- --------
The Audit Committee will meet at least four times each year. The Audit
Committee may properly come beforeestablish its own schedule which it will provide to the meeting.Board of
Directors in advance.
The undersigned hereby acknowledges receiptAudit Committee will meet separately with the Chief Executive Officer
and separately with the Chief Financial Officer of the NoticeCompany at least annually
to review the financial affairs of Annual Meetingthe Company. The Audit Committee will meet
with the independent auditors of Shareholdersthe Company, at such times as it deems
appropriate, to review the independent auditor's examination and accompanying Proxy Statement, ratifies all that said proxies
or their substitutes may lawfully do by virtue hereof, and revokes all former
proxies.
Please sign exactlymanagement
report.
REPORTS:
- -------
The Audit Committee will record its summaries of recommendations to the
Board in written form which will be incorporated as your name appears hereon, date and return this Proxy.
UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED TO GRANT AUTHORITY TO
APPROVE AND ADOPT THE AMENDMENT TO THE COMPANY'S AMENDED AND RESTATED ARTICLES
OF INCORPORATION, TO ELECT THE NOMINATED DIRECTORS AND TO RATIFY THE APPOINTMENT
OF MCGLADREY & PULLEN, LLP AS THE COMPANY'S AUDITORS. IF OTHER MATTERS COME
BEFORE THE MEETING, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE BEST
JUDGMENT OF THE PROXIES APPOINTED.
DETACH BELOW AND RETURN USING THE ENVELOPE PROVIDED
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THE FEMALE HEALTH COMPANY ANNUAL MEETING OF SHAREHOLDERS
1. To approve and adopt the amendment to the Company's Amended and Restated [ ] FOR [ ] AGAINST [ ] ABSTAIN
Articles of Incorporation to increase the total number of authorized shares
of the Company's common stock from 27,000,000 to 35,500,000 shares.
2. ELECTION OF DIRECTORS: [ ] FOR all [ ] WITHHOLD
(terms expiring at the 2003 1-O.B. PARRISH 2-MARY ANN LEEPER, PH.D. 3-WILLIAM R. nominees listed AUTHORITY to
Annual Meeting) GARGIULO, JR. 4-STEPHEN M. DEARHOLT 5-DAVID R. BETHUNE to the left vote for all
6-MICHAEL R. WALTON 7-JAMES R. KERBER (except as nominees listed
8-RICHARD E. WENNINGER specified below). to the left.
(Instructions: To withhold authority to vote for any indicated nominee, ----------------------------------
write the number(s) of the nominee(s) in the box provided to the right.) | |
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3. To ratify the appointment of McGladrey & Pullen, LLP as the Company's [ ] FOR [ ] AGAINST [ ] ABSTAIN
auditors for the fiscal year ending September 30, 2002.
4. In their discretion, the Proxies are authorized to vote upon such other
matters as may properly come before the meeting.
Date NO. OF SHARES
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CHECK APPROPRIATE BOX
Indicate changes below: ---------------------------------------------
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Address Change? [ ] Name Change? [ ] | |
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Signature(s) in Box
If signing as attorney, executor,
administrator, trustee or
guardian, please add your full
title as such. If shares are
held by two or more persons, all
holders must sign the Proxy.
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a part of the minutes of the
Board of Directors at which those recommendations are presented.
MINUTES:
- -------
The Audit Committee will maintain written minutes of its meetings, which
minutes will be filed with the minutes of the meetings of the Board of
Directors.
25