SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION (Rule 14a-101)
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
[X] Definitive Proxy Statement Commission Only (as Permitted by Rule
[ ] Definitive Additional Materials 14a-6(e)(2))
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
BOVIE MEDICAL CORPORATION
(Name of the Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other then the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i) (4) and 0-11. 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:
Bovie Medical Corporation
734 Walt Whitman Road Suite 207
Melville, NY 11747
June 23, 2003
Dear Stockholder:
On behalf of your Board of Directors and Management, you are cordially invited
to attend the Annual Meeting of Common Stockholders to be held on July 30, 2003
at 4:00P.M., at the Holiday Inn located at 215 Sunnyside Blvd., (Exit46 Long
Island Expressway or Exit 38 Northern State Parkway) Plainview, Long Island, NY
11803, Telephone No. (516)349-1240.
The enclosed Notice and Proxy Statement contain details concerning the business
to come before the meeting. You will note that the Board of Directors of the
Company recommends a vote "FOR" the election of the nominated Directors to serve
until the next Annual Meeting of Stockholders,"FOR" Ratification of the
selection of Bloom & Company, as the Company's independent accountants; and
"FOR" Ratification of the Company's 2003 Executive and Employee Stock Option
Plan
Whether or not you attend the Annual Meeting, please vote as soon as possible by
returning the enclosed proxy. Your vote is important, and voting by written
proxy will ensure your representation at the Annual Meeting. You may revoke your
proxy in accordance with the procedures described in the Proxy Statement at any
time prior to the time it is voted.
Thank you for your support of Bovie.
Sincerely,
Bovie Medical Corporation
/s/ Andrew Makrides
PRESIDENT AND CHIEF EXECUTIVE OFFICER
This proxy statement and the accompanying proxy are being mailed to Bovie
Medical Corporation common stockholders beginning about June 23, 2003.
Bovie Medical Corporation
734 Walt Whitman Road Suite 207
Melville, NY 11747
June 23, 2003
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Dear Stockholder:
Bovie Annual Meeting of Stockholders' will be held on July 30, 2003 at 4:00PM at
the Holiday Inn located at 215 Sunnyside Blvd., (Exit46 Long Island Expressway
or Exit 38 Northern State Parkway) Plainview, Long Island, NY 11803 Telephone
No. (516)349-1240.
At the meeting, stockholders will be asked to:
1. Elect Bovie's entire Board of Directors,
2. Ratify the selection of Bovie's independent auditors for 2003,
3. Approve the Bovie 2003 Executive and Employee Stock Option Plan, and
4. Such other business properly brought before the meeting.
The close of business on June 2, 2003 is the record date for determining
stockholders entitled to vote at the Annual Meeting. Consequently, only
stockholders whose names appear on our books as owning our Common Stock at the
close of business on June 2, 2003 will be entitled to notice of and to vote at
the Annual Meeting and adjournment or postponement thereof.
PLEASE SIGN, DATE AND PROMPTLY RETURN THE ENCLOSED PROXY IN THE ENCLOSED
ENVELOPE, SO THAT YOUR SHARES WILL BE REPRESENTED WHETHER OR NOT YOU ATTEND THE
ANNUAL MEETING.
In order to facilitate planning for the Annual Meeting, please indicate on the
enclosed proxy whether or not you plan to attend the meeting.
By order of the board of directors
/s/ Andrew Makrides
PRESIDENT AND CHIEF EXECUTIVE OFFICER
June 23, 2003
CONTENTS
ABOUT THE ANNUAL MEETING 1
ANNUAL REPORT 2
STOCK OWNERSHIP 3
MANAGEMENT 3
MEETINGS OF THE BOARD OF DIRECTORS 3
DIRECTORS COMPENSATION 4
EXECUTIVE COMPENSATION 4
COMPENSATION TABLE 4
SECURITY OWNERSHIP OF BENEFICIAL OWNERS 6
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 7
PROPOSAL ONE: ELECTION OF DIRECTORS 7
PROPOSAL TWO: RATIFACTION OF SELECTION OF AUDITORS 9
PROPOSAL THREE: APPROVAL OF BOVIE 2003 EXECUTIVE
AND EMPLOYEE STOCK OPTION PLAN 9
THE PLAN 9
FEDERAL INCOME TAX CONSEQUENCES 10
SUBMISSION OF FUTURE STOCKHOLDER PROPOSALS 11
COST OF ANNUAL MEETING AND PROXY SOLICITATION 11
BOVIE 2003 EXECUTIVE AND EMPLOYEE STOCK OPTION PLAN 12
FORM OF OPTION 20
ABOUT THE ANNUAL MEETING
WHO IS SOLICITATING YOUR VOTE?
The Board of Directors of Bovie Medical Corporation ("Bovie") is soliciting your
vote at the Annual Meeting of Bovie's common stockholders being held on July 30,
2003.
WHAT WILL YOU BE VOTING ON?
1. Election of Bovie's Board of Directors (see page 7).
2. Ratification of BLOOM & CO., LLP, as Bovie's auditors for 2003
(see page 9).
3. Approval and adoption of the Bovie 2003 Executive and Employee Stock Option
Plan (see page 9).
HOW MANY VOTES DO YOU HAVE?
You will have one vote for every share of the Company's common stock you owned
of record on June 2, 2003(the record date).
HOW MANY VOTES CAN BE CAST BY ALL COMMON STOCKHOLDERS?
One vote for each of the Company's outstanding shares of common stock which were
outstanding on the record date. The common stock will vote as a single class on
all matters scheduled to be voted on at the Annual Meeting. There is no
cumulative voting.
HOW MANY VOTES MUST BE PRESENT TO HOLD THE MEETING?
A majority of the votes that can be cast, or a minimum of 6,602,378 votes must
be present in person or by proxy in order to hold the meeting.
HOW DO YOU VOTE?
o You can vote either in person at the Annual Meeting or by proxy without
attending the Annual Meeting. We urge you to vote by proxy even if you plan
to attend the Annual Meeting; so that we will know as soon as possible that
enough votes will be present for us to hold the meeting.
o To vote by proxy, you must fill out the enclosed proxy, date and sign it,
and return it in the enclosed postage-paid envelope.
o If you want to vote in person at the Annual Meeting, and you hold your
Bovie stock through a securities broker (that is, in street name), you must
obtain a proxy from your broker and bring that proxy to the meeting.
CAN YOU CHANGE YOUR VOTE?
Yes. Just send in a new proxy with a later date, or send a written notice of
revocation to Bovie's Secretary at the address on the cover of this proxy
statement. If you attend the Annual Meeting and want to vote in person, you can
request that your previously submitted proxy not be used.
WHAT IF YOU DO NOT VOTE FOR SOME OF THE MATTERS LISTED ON YOUR PROXY?
If you return a signed proxy without indicating your vote, your shares will be
voted "FOR" each of the director nominees listed on the proxy, "FOR" Bloom &
Company as auditor, and "FOR" the Bovie 2003 Executive and Employee Stock
Purchase and Option Plan.
WHAT IF YOU VOTE "ABSTAIN"?
A vote to "abstain" on any matter your shares will not be voted for such matter
and will have the effect of a vote against the proposal.
CAN YOUR SHARES BE VOTED IF YOU DO NOT RETURN YOUR PROXY AND DO NOT ATTEND THE
ANNUAL MEETING?
o That depends upon whether the shares are registered in your name or your
broker's name ("street name"). If you do not vote your shares held in
street name, your broker can vote your shares on any of the matters
scheduled to come before the meeting.
o If you do not vote your shares held in your broker's name, or "street
name", and your broker does not vote them, the votes will be broker non
votes, which will have the effect of a vote FOR any matter scheduled to be
considered at the Annual Meeting.
o If you do not attend and vote your shares which are registered in your name
or otherwise vote by proxy, your shares will not be voted.
COULD OTHER MATTERS BE DECIDED AT THE ANNUAL MEETING?
We do not know of any other matters that will be considered at the Annual
Meeting. If a stockholder proposal that was excluded from this proxy statement
is otherwise properly brought before the meeting, we will vote the proxies
against that proposal. If any other matters arise at the Annual Meeting, the
proxies will be voted at the discretion of the proxy holders.
WHAT HAPPENS IF THE MEETING IS POSTPONED OR ADJOURNED?
Your proxy will still be valid and may be voted at the postponed or adjourned
meeting. You will still be able to change or revoke your proxy until it is
actually voted.
ANNUAL REPORT
The Company has included herewith a copy of its Annual Report for the fiscal
year ended December 31, 2002 ("2002 Annual Report"). Additional copies of the
2002 Annual Report may be obtained by Shareholders without charge by writing to
Andrew Makrides, President, at the Company's New York offices at 734 Walt
Whitman Road Melville, NY 11747.
Confidentiality
It is the Company's policy that all proxies, ballots and voting materials that
identify the particular vote of a stockholder are kept confidential, except in
the following circumstances:
o to allow the election inspector appointed for our Annual Meeting to certify
the results of the vote;
o as necessary to meet applicable legal requirements, including the pursuit
or defense of a judicial action;
o where we conclude in good faith that a bona fide dispute exists as to the
authenticity of one or more proxies, ballots, or votes, or as to the
accuracy of the tabulation of such proxies, ballots, or votes;
o where a stockholder expressly requests disclosure or has made a written
comment on a proxy;
o where contacting stockholders by us is necessary to obtain a quorum, the
names of stockholders who have or have not voted (but not how they voted)
may be disclosed to us by the election inspector appointed for the Annual
Meeting;
o aggregate vote totals may be disclosed to us from time to time and publicly
announced at the meeting of stockholders at which they are relevant; and in
the event of any solicitation of proxies with respect to any of our
securities by a person other than us of which solicitation we have actual
notice.
STOCK OWNERSHIP
We encourage stock ownership by our directors, officers and employees to align
their interests with the interests of stockholders. Management further believes
this policy has played a significant role in the progress of our company and
will, ultimately, lead to beneficial future returns for its stockholders.
Management also fosters stock ownership by all of its employees through various
measures, such as stock option grants, restricted stock awards, and
participation in developing programs, including, if it is approved by
stockholders at the Annual Meeting, the Company's 2003 Executive and Employee
Stock Option Plan that is one of the proposals to be voted upon at the Annual
Meeting.
MANAGEMENT
The following table sets forth certain information as of the record date,
regarding each of the executive officers and directors of the Company.
The Company's Executive Officers and directors are as follows:
Name Position Director Since
- ---- -------- --------------
Andrew Makrides Chairman or the Board, December, 1982
President, CEO& Director
J. Robert Saron Director and President of August, 1994
Aaron Medical Industries, Inc.
George W. Kromer, Jr. Director October, 1995
Alfred V. Greco Director April, 1998
Moshe Citronowicz Executive Vice-President
Chief Operating Officer -------
Charles Peabody Chief Financial -------
Officer, Secretary- Treasurer
MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors (the "Board") had five special meetings times in 2002
which were attended by all directors, including telephonic meetings of the
Board. There were no committees established in 2002 because the Board of
Directors continues to manage the Plan. As such, the participation activity
requirements of each member of the Board are increasing. In addition, Management
is aggressively pursuing and implementing marketing and other strategies set
forth by the Board. Due to the limited number of members and the increased
degrees of activity of the Board of Directors (four) the Nominees, if elected,
may consider establishment of Executive, Audit and Compensation committees in
accordance with the new legislation (Sarbanes- Oxley Act) and the procedures set
forth in the Company's by-laws.
DIRECTORS' COMPENSATION
Directors' compensation is determined by the Board. At present, the Board does
not have a standard policy regarding compensation of members of the Board of
Directors. The Board has granted directors stock options and restricted common
stock, in order to assure that the directors have an opportunity for and/or have
an ownership interest in common with other stockholders. The Nominees, if
elected, may require the Board or Compensation committee, if established, to
adopt a standard policy regarding compensation of members of the Board.
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid to the executive officers
of the registrant for the three years ended December 31, 2002:
Summary Compensation Table
Annual Compensation
-------------------
Name and
Principal
Position Year Salary Bonus Other
- -------- ---- ------ ----- -----
Andrew Makrides 2002 $141,835 2,760 9,581
President, CEO 2001 $146,446 2,567 12,352
Chairman of 2000 $123,764 2,388 7,235
the Board
J. Robert Saron 2002 $200,545 3,907 15,533
Director 2001 $199,485 3,624 18,018
President of Aaron 2000 $167,528 3,381 12,556
Director
Moshe Citronowicz
Executive
Vice President- 2002 $147,370 2,871 15,688
Chief Operating 2001 $149,697 2,671 17,205
Officer 2000 $122,076 2,485 12,711
Summary Compensation Table
Long Term Compensation
----------------------
Name and
Principal
Position Awards(#) SARS(#) Pay-outs
- -------- --------- ------- --------
Andrew Makrides -- -- --
President, CEO -- 155,000 --
Chairman of
the Board
-- -- --
J. Robert Saron -- -- --
Director -- 155,000 --
President of Aaron -- -- --
Medical and
Director
Moshe Citronowicz
Executive
Vice President- -- -- --
Chief Operating -- 155,000 --
Officer -- -- --
________________
(a) Other compensation consists of medical insurance and auto.
No options were granted or issued to any Executive Officer or Director during
fiscal year ending December 31, 2002; nor were any previously issued options
exercised by any Executive Officer or Director during the past year.
Equity Compensation Plan Information:
Column (a) Column (b)
Plan category Number of Securities Weighted-average
to be issued upon exercise price of
exercise of outstanding options,
outstanding options, warrants and rights
Equity compensation
Plans approved by
Security holders 2,909,000 $ .70
Equity compensation
Plans not approved
By security holders ---------- ----
Total 2,909,000 $ .70
========== ====
Column (c)
Plan category Number of securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column((a))
Equity compensation
Plans approved by
Security holders 237,000
Equity compensation
Plans not approved
By security holders -------
Total 237,000
=======
The following table summarizes the options granted to Executive Officers in the
last fiscal year, the aggregated option exercises in the last fiscal year and
the fiscal year end option values.
Shares Number of Value of
Acquired Value Unexercised Unexercised
Name On Options at in the money
Exercise(#) Realized Fiscal Year Options at
Unexercised Fiscal Year
End (a)
Andrew
Makrides NONE N/A 375,000 $72,313
J. Robert
Saron NONE N/A 395,000 $72,313
Moshe
Citronowicz NONE N/A 330,000 $72,313
Outside Directors are compensated in their capacities as Board members through
option grants. The Company's Board of Directors presently consists of Andrew
Makrides, Chairman, CEO, and President, J. Robert Saron, President of Aaron
Medical Industries, Inc. (our wholly owned subsidiary), George W. Kromer, Jr.
and Alfred V. Greco. Mr. Kromer has been retained pursuant to agreement as a
management consultant by Bovie Medical Corporation for the past year at an
average monthly fee of approximately $1,500 Mr. Kromer was not awarded stock
options by the Company in fiscal 2002. Mr. Greco is the managing director of
Alfred V. Greco PLLC, counsel to Bovie, which earned legal fees from the Company
of $59,600 during 2002. Mr. Greco received no options to purchase any of the
Company's Common Stock in 2002.
There have been no changes in the exercise prices of any options previously
awarded. In February 2002, the Company extended employment contracts with its
Officers for three years.
The following schedule shows all contracts and terms with Officers of the
Company.
Bovie Medical Corporation
Executive Officers' Contracts
December 31, 2002
2002
Contract Expiration Current Auto
Date Date (1) Base Pay (2) Allowance
-------- ---------- ------------ -----------
Andrew
Makrides 01/01/98 12/31/2007 $ 135,327 $ 6,310
J. Robert
Saron 01/01/98 12/31/2007 $ 185,461 $ 6,310
Moshe
Citronowicz 01/01/98 12/31/2007 $ 140,798 $ 6,310
____________
(1) Includes a two year and a three year extension. In the event of a change in
control, each employment agreement grants each respective Executive Officer
an option to resign and demand a sum equal to 3 years salary.
(2) Salaries increase annually pursuant to a contract formula.
Security Ownership of Certain Beneficial Owners and Management of Bovie
The following table sets forth certain information as of December 31, 2002, with
respect to the beneficial ownership of the Company's common stock by all persons
known by the Company to be the beneficial owners of more than 5% of its
outstanding shares, by directors who own common stock and/or options to purchase
common stock and by all officers and directors as a group.
Number of Share Nature Percentage
of of
Name and Address Title Owned Ownership Ownership(i)
- ----------------- ----- -------- --------- ------------
Maxxim Medical Inc. Common 3,000,000 Beneficial 18.2%
10300 49th Street, North
Clearwater, FL 33762
Directors and Officers
- ----------------------
Andrew Makrides Common 690,800(ii) Beneficial 4.2%
734 Walt Whitman Road
Melville, NY 11746
George W. Kromer, Jr. Common 305,000(iii) Beneficial 1.8%
P.O. Box 188
Farmingville, NY 11738
Alfred V. Greco Common 301,500(iv) Beneficial 1.8%
666 Fifth Avenue
New York, NY 10103
J. Robert Saron Common 827,976(v) Beneficial 5.0%
7100 30th Avenue North
St. Petersburg, FL 33710
Officers and Directors as a group 2,629,867(vi) 16.0%
(i) Based on 13,256,103 outstanding shares of Common Stock and 2,909,000
outstanding options to acquire a like number of shares of Common Stock as
of December 31, 2002, of which officers and directors owned a total of
1,655,000 options at December 31, 2002.
(ii) Includes 375,000 shares reserved and underlying ten year options owned by
Mr. Makrides to purchase shares of Common Stock of the Company. Exercise
prices for his options range from $.50 for 155,000 shares to $1.15 for
50,000 shares.
(iii)Constitute shares reserved pursuant to 305,000 ten year options owned by
Mr. Kromer to purchase shares of the Company. Exercise prices for his
options range from $.50 for 100,000 shares to $1.125 for 105,000 shares.
(iv) Includes 250,000 shares reserved pursuant to ten year options exercisable
at prices varying between $.50 per share (100,000 shares) up to $.75 per
share (150,000 shares).
(v) Includes 395,000 shares reserved pursuant to ten year options exercisable
at prices ranging from $1.125 per share for 30,000 shares, $.75 per share
for 210,000 shares, and $0.50 per share for 155,000 shares.
(vi) Includes 1,655,000 shares reserved for outstanding options owned by all
Executive Officers and directors as a group.
Certain Relationships and Related Transactions
In January 2003, the Executive Officers and directors were awarded a total of
400,000 options to purchases the Company's Common Stock at exercise prices of
$.70 per share under the Company's 2003 Executive and Employee Stock Option
Plan. See Remuneration
A director, Alfred V. Greco Esq. is the principal of Alfred Greco PLLC, the
Company's counsel. That law firm received $59,303 and $90,136 in legal fees for
the years 2002 and 2001, respectively.
A director, George W. Kromer, Jr. also serves as a consultant to the Company
with consulting compensation of $17,586 and $19,807 for 2002 and 2001,
respectively.
Two relatives of the chief operating officer of the Company are employed by the
Company. Yechiel Tsitrinovich, an engineering consultant received compensation
for 2002 and 2001 of $77,150 and $4,500 respectively. The other relative, Arik
Zoran, is an employee of the Company in charge of the engineering department. He
has a two year contract providing for a salary of $90,000 per year plus living
expenses and benefits. We are attempting at this time to secure a permanent work
visa for Mr. Zoran.
PROPOSAL ONE
ELECTION OF DIRECTORS
The Board of Directors has nominated all of the current directors for
re-election at the Annual Meeting. All directors serve until the next Annual
Meeting of stockholders or until their successors are duly elected and
qualified.
THE NOMINEES
The following section gives information - provided by the nominees - about their
principal occupation, business experience and other matters.
THE BOARD RECOMMENDS THAT YOU VOTE "FOR" EACH OF THE FOLLOWING NOMINEES.
ANDREW MAKRIDES
J. ROBERT SARON
ALFRED V. GRECO
GEORGE W. KROMER, JR.
Andrew Makrides, age 61, Chairman of the Board and President, member of the
Board of Directors, received a Bachelor of Arts degree in Psychology from
Hofstra University and a Doctor of Jurisprudence JD Degree from Brooklyn Law
School. He is a member of the Bar of the State of New York and practiced law
from 1968 until joining Bovie Medical Corporation as Executive Vice President
and director, in 1982. Mr. Makrides became President of the Company in 1985 and
the CEO in December 1998 and has served as such to date.
J. Robert Saron, age 50, Director, holds a Bachelors degree in Social and
Behavioral Science from the University of South Florida. From 1988 to present
Mr. Saron has served as a president and director of Aaron Medical Industries,
Inc. ("Aaron"). Aaron is a wholly owned subsidiary of Bovie and serves, among
other things, as Bovie's marketing subsidiary. Mr. Saron served as CEO and
chairman of the Board of the Company from 1994 to December 1998. Mr. Saron is
presently the President of Aaron and a member of the Board of Directors of the
Company.
A1fred V. Greco, Esq., age 67, Director, is the principal of Alfred V. Greco,
PLLC, and has been counsel to the Company since its inception. Mr. Greco is a
member of the Bar of the State of New York and has been engaged in the practice
of law for the past 35 years in the City of New York. The main focus of Mr.
Greco's experience for the past 30 years has been in the area of corporate and
securities law during which he has represented a large number of public
companies, executives, securities brokerage firms and registered representative
and has developed a broad range of experience in administrative, regulatory and
legal aspects of companies whose securities are publicly held. Mr. Greco
graduated from Fordham University School of Law with a Doctor of Jurisprudence
(JD) Degree, in June 1960. He was admitted to the New York State Bar in March
1961.
George W. Kromer, Jr., age 62, filled a vacancy on the Board of Directors and
became a director on October 1, 1995. Mr. Kromer has in the past served as a
Senior Financial Correspondent for "Today's Investor" and has been employed as a
consultant by a number of companies, both private and public. Bovie Medical
Corporation has also retained Mr. Kromer as a consultant in addition to his
capacity as a director. He received a Master's Degree in 1976 from Long Island
University in Health Administration. He was engaged as a Senior Hospital Care
Investigator for the City of New York Health & Hospital Corporation from 1966 to
1986. He also holds a Bachelor of Science Degree from Long Island University's
Brooklyn Campus and an Associate in Applied Science Degree from New York City
Community College, Brooklyn, New York.
PROPOSAL TWO
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors has selected BLOOM & CO., LLP, ("BLOOM") as the
independent auditors of Bovie for 2003. BLOOM has served as the independent
auditors of the Company since 1983. Arrangements have been made for a
representative of BLOOM to attend the Annual Meeting. The representative will
have an opportunity to make a statement if he or she desires to do so, and will
be available to respond to appropriate stockholder questions. The selection of
BLOOM as the Company's auditors must be ratified by a majority of the votes cast
at the Annual Meeting. BLOOM is a member of the Securities and Exchange Division
of the American Institute of Certified Public Accountants ("AICPA") duly
authorized to perform audits of SEC registrants. The firm is current with its
peer review system and has maintained an unqualified quality control status
since the inception of the peer review system established by the AICPA.
Audit Fees. The aggregate fees billed for professional services rendered for the
audit of our financial statements for the fiscal year ended December 31, 2002
and the review of the Company's financial statements included in our quarterly
filings on Form 10QSB during that fiscal year were $121,304. There were no other
fees paid for other services performed by Bloom & Co., LLP or its employees.
THE BOARD RECOMMENDS THAT YOU VOTE "FOR" RATIFICATION OF BLOOM &COMPANY AS THE
COMPANY'S INDEPENDENT AUDITORS FOR 2003.
PROPOSAL THREE
APPROVAL OF THE COMPANY'S 2003 Executive & EMPLOYEE STOCK OPTION PLAN
On January 21, 2003, Bovie's Board of Directors approved the Bovie Medical
Corporation 2003 Executive and Employee Stock Option Plan (the "Plan") and
recommended formalizing and submitting the plan to stockholders for approval at
the Annual Meeting. The plan became effective as of January 21, 2003. A total of
400,000 options to purchase a like number of shares at $.70 per share were
granted to officers and directors under the Plan in January, 2003.
The Board of Directors of the Company shall administer the Plan.
The plan affords key employees, officers, and consultants, who are responsible
for the continued growth of the Company, an opportunity to acquire a proprietary
interest in the Company, and, thus, to create in such individuals a greater
concern for the welfare of the Company and its subsidiaries. The Company, by
means of this 2003 Executive and Employee Stock Option Plan, seeks to retain the
services of persons now holding key positions and to secure the services of
persons capable of filling such positions. The following summary is qualified by
reference to the complete text of the Plan, which is attached hereto.
THE PLAN
Up to 1,200,000 shares of common stock, subject to adjustments for stock
dividends, splits and other events that affect the number of shares of common
stock outstanding, may be issued under the plan. Stock subject to purchase under
the plan will be shares of common stock that have been authorized but unissued,
or have been previously issued and reacquired by the Company, or both.
Maximum Purchase. The options offered under the plan are a matter of separate
inducement and are not in lieu of any salary or other compensation for the
services of any key employee or consultant. The options granted under the plan
are intended to be either Incentive Stock Options ("ISO") or Non- Qualified
Stock Options ("NQSO"). The aggregate fair market value of shares subject to an
ISO to a participant's stock purchases in any calendar year shall not exceed one
hundred thousand dollars ($100,000.00).
Option. Participants will receive an option. The option will state the number of
shares of common stock to be purchased underlying the options granted.
Exercise Price. The purchase price per share purchasable under an option will be
determined by the Committee, provided, however, that such purchase price shall
not be less than 90% of the fair market value of a share on the date of grant of
such option; provided further, any option granted to a participant who, at the
time such option is granted, is an officer or director of the Company, the
purchase price shall not be less than 100% of the fair market value of a share
on the date of grant of such option. However, in the case of an ISO granted to a
participant who, at the time such option is granted, is deemed to be a 10%
Shareholder, the purchase price for each share will be such amount as the
Committee in its best judgment shall determine to be not less than 110% of the
fair market value per share on the date the ISO is granted.
Term of Option. The term of each option shall be fixed by the Committee which in
any event will not exceed a term of 10 years from the date of the grant,
provided, however, that the term of any ISO' granted to any 10% Shareholder will
not be exercisable after the expiration of 5 years from the date such ISO was
granted.
Termination of Employment. The Committee will determine the effects of a
participant's retirement, death, disability, leave of absence or any other
termination of employment during the Term of any option.
Amendments. The Board may amend, alter, suspend, discontinue or terminate the
plan; provided, however, that, notwithstanding any other provision of the plan
or any option, without approval of the stockholders of the Company, no such
amendment, alteration, suspension, discontinuation or termination will be made
that, absent such approval, (1) would cause Rule 16b-3 to become unavailable
with respect to the Plan, (2) would violate the rules or regulations of any
national securities exchange on which the shares of the Company are traded or
the rules or regulations of the NASD that are applicable to the Company, or (3)
would cause the Company to be unable, under the Code, to grant ISOs under the
plan.
FEDERAL INCOME TAX CONSEQUENCES
The following is a general summary of the federal income tax consequences under
current tax law of NQSOs and ISOs. It does not purport to cover all of the
special rules, including special rules relating to optionees subject to Section
16(b) of the Exchange Act and the exercise of an option with previously acquired
shares, or the state or local income or other tax consequences inherent in the
ownership and exercise of stock options and the ownership and disposition of the
underlying shares.
An optionee will not recognize taxable income for federal income tax purposes
upon the grant of a NQSO or an ISO. Upon the exercise of a NQSO, the optionee
will recognize ordinary income in an amount equal to the excess, if any, of the
fair market value of the shares acquired on the date of exercise over the
exercise price thereof, and the Company will generally be entitled to a
deduction for such amount at that time. If the optionee later sells shares
acquired pursuant to the exercise of a NQSO, he or she will recognize long-term
or short-term capital gain or loss, depending on the period for which the shares
were held. Long-term capital gain is generally subject to more favorable tax
treatment than ordinary income or short-term capital gain. Upon the exercise of
an ISO, the optionee will not recognize taxable income. If the optionee disposes
of the shares acquired pursuant to the exercise of an ISO more than two years
after the date of grant and more than one year after the transfer of the shares
to him or her, the optionee will recognize long-term capital gain or 1055 and
the Company will not be entitled to a deduction. However, if the optionee
disposes of such shares within the required holding period, all or a portion of
the gain will be treated as ordinary income and the Company will generally be
entitled to deduct such amount.
In addition to the federal income tax consequences described above, an optionee
may be subject to the alternative minimum tax, which is payable to the extent it
exceeds the optionee's regular tax. For this purpose, upon the exercise of an
ISO, the excess of the fair market value of the shares over the exercise price
therefor is an adjustment which increases alternative minimum taxable income. In
addition, the optionee's basis in such shares is increased by such excess for
purposes of computing the gain or loss on the disposition of the shares for
alternative minimum tax purposes. If an optionee is required to pay an
alternative minimum tax, the amount of such tax which is attributed to deferral
preferences (including the ISO adjustment) is allowed as a credit against the
optionee's regular tax liability in subsequent years. To the extent the credit
is not used, it is carried forward.
Although management believes it is in the interests of shareholders that the
Plan be approved in order to attract and retain qualified employees and
consultants, since the plan authorizes the grant of options to purchase up to
1,200,000 shares of common stock, the grant and exercise of the options would
tend to dilute the percentage ownership of shareholders in the Company.
Furthermore, the nature of the options is such that the options would be
exercised at a time that the Company likely would be able to derive a higher
price for Company shares than the exercise price.
The Board believes the plan is an effective means of aligning the interests of a
broad range of employees with the interests of our stockholders.
THE BOARD RECOMMENDS THAT YOUR VOTE "FOR" THE COMPANY'S 2003 EXECUTIVE &
EMPLOYEE STOCK OPTION PLAN
SUBMISSION OF FUTURE STOCKHOLDER PROPOSALS
Under Securities and Exchange Commission ("SEC") rules, a stockholder who
intends to present a proposal at the next Annual Meeting of stockholders and who
wishes the proposal to be included in the proxy statement for that meeting must
submit the proposal in writing to the President or Secretary of the Company, at
the address on the cover of this proxy statement. The proposal must be received
no later than March 31, 2004.
Stockholders who do not wish to follow the SEC rules in proposing a matter for
action at the next Annual Meeting must notify the Company in writing of the
information required by the provisions of its by-laws dealing with stockholder
proposals. The notice must be delivered to the Company's Corporate Secretary
between Apri1, 2004 and November 30, 2004. You can obtain a copy of the
Company's by-laws by writing to the attention of the Corporate Secretary at the
address shown on the cover of this proxy statement.
COST OF ANNUAL MEETING AND PROXY SOLICITATION
The Company pays the expense of preparing, assembling, printing, mailing and
filing this Proxy Statement and materials used in this solicitation of proxies
with the SEC and its stockholders, which is estimated not to exceed $30,000. The
solicitation will be made by mail. The Company will supply brokers or persons
holding shares of record in their names or in the names of nominees for other
persons, as beneficial owners, with such additional copies of proxies, proxy
materials and Annual Reports as may reasonably be requested in order for such
record holders to send one copy to each beneficial owner, and will upon request
of such record holders, reimburse them for their reasonable expenses in mailing
such material. Certain directors, officers and employees of the Company, not
especially employed for this purpose, may solicit proxies, without additional
remuneration therefor, by mail, telephone, telegraph or personal interview.
Bovie Medical Corporation
2003 Executive and Employee Stock Option Plan
SECTION 1
PURPOSES.
Bovie Medical Corporation (the "Company") desires to afford certain of its
key employees, officers, directors and consultants who are responsible for the
continued growth of the Company an opportunity to acquire a proprietary interest
in the Company, and thus to create in such individuals an increase in and
greater concern for the welfare of the Company and its subsidiary.
The Company, by means of this 2003 Executive and Employee Stock Option Plan
(the "Plan"), seeks to retain the services of persons now holding key positions
and to secure the services of persons capable of filling such positions.
The stock options offered pursuant to the Plan are a matter of separate
inducement and are not in lieu of any salary or other compensation for the
services of any key employee or consultant.
The stock options granted under the Plan are intended to be either
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, or options that do not meet the requirements
for incentive stock options.
SECTION 2
DEFINITIONS.
As used in the Plan, the following terms shall have the meanings set forth
below:
(a) "Affiliate" shall mean (i) any entity that, directly or indirectly
through one or more intermediaries, is controlled by the Company and (ii) any
entity in which the Company has a significant equity interest.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and any regulations promulgated thereunder.
(c) "Committee" shall mean the Board of Directors, or a committee of the
Board of Directors of the Company designated by resolution of the Board of
Directors to administer the Plan, which shall consist of not less than two (2)
"Non-Employee Directors," as such term is defined in Rule 16b-3(b)(3)(i)
promulgated under the Securities Exchange Act of 1934, as amended, each having
the requisite qualifications thereunder to satisfy the requirements of Rule
16b-3.
(d) "Company shall mean BOVIE MEDICAL CORPORATION", a Delaware corporation.
(e) "Eligible Person" shall mean any employee, officer or consultant
providing services to the Company or any Affiliate who the Committee determines
to be an Eligible Person. A director of the Company who is not also an employee
of the Company or an Affiliate shall not be an Eligible Person.
(f) "Fair Market Value" shall mean the closing "bid" price of the Company's
Shares on the date in question as quoted on the Electronic Bulletin Board of the
National Association of Securities Dealers or its Automated Quotation System
("NASDAQ") or on any successor national stock exchange on which the Common Stock
is then traded, provided, however, that if on the date in question there is no
public market
for the Company's Shares and they are neither quoted on "NASDAQ" nor traded on a
national securities exchange, then the Committee shall, in its sole discretion
and best judgment, determine the Fair Market Value.
(g) "Incentive Stock Option" shall mean an option granted under the Plan
that is intended to meet the requirements of Section 422 of the Code or any
successor provision.
(h) "Non-Qualified Stock Option" shall mean an option granted under the
Plan that is not intended to be an Incentive Stock Option.
(i) "Option" shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.
(j) "Option Agreement" shall mean any written agreement, contract or
document evidencing any Option granted under the Plan.
(k) "Participant" shall mean an Eligible Person designated to be granted
an Option under the Plan.
(l) "Person" shall mean any individual, corporation, partnership,
association, limited liability company, association or trust.
(m) "Plan" shall mean this 2003 Executive and Employee Stock Option Plan,
as amended from time to time.
(n) "Rule 16b-3" shall mean Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended, or
any successor rule or regulation.
(o) "Shares" shall mean shares of Common Stock, $.001 par value, of the
Company.
SECTION 3
ADMINISTRATION.
(a) Power and Authority of the Committee. The Plan shall be administered by the
Board of Directors, or, pursuant to resolution of the Board of Directors, a
committee consisting of at least two non-employee directors, (the "Committee").
Subject to the express provisions of the Plan and to applicable law, the
Committee shall have full power and authority to: (i) designate Participants;
(ii) determine the types of Options (e.g., whether Incentive Stock Options or
Non-Qualified Stock Options) to be granted to each Participant under the Plan;
(iii) determine the number of Shares to be covered by each Option; (iv)
determine the terms and conditions of any Option Agreement; (v) amend the terms
and conditions of any Option Agreement and accelerate the exercisability of
Options covered thereunder; (vi) determine whether, to what extent and under
what circumstances Options may be exercised in cash, Shares or other property,
or canceled, forfeited or suspended; (vii) determine whether, to what extent and
under what circumstances Options shall be deferred either automatically or at
the election of the holder thereof or the Committee; (viii) interpret and
administer the Plan and any instrument or Option Agreement relating to, or
Option granted under the Plan; (ix) establish, amend, suspend or waive such
rules and regulations and appoint such agents as it shall deem appropriate for
the proper administration of the Plan; and (x) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations and other decisions under or with
respect to the Plan or any Option shall be within the sole discretion of the
Committee, may be made at any time and shall be final, conclusive and binding
upon any Participant, any holder or beneficiary of any Option granted under the
Plan and any employee of the Company or any Affiliate.
SECTION 4
AVAILABLE SHARES SUBJECT TO OPTION.
(a) Shares Available. The total number of Shares for which Options may be
granted pursuant to the Plan shall be 1,200,000 Shares of the Common Stock in
the aggregate, subject to adjustment as provided in Section 4(c). If any Shares
covered by an Option or to which an Option relates are not purchased or are
forfeited, or if an Option otherwise expires, then the number of Shares counted
against the aggregate number of Shares available under the Plan with respect to
such Option, to the extent of any such forfeiture or termination, shall again be
available for Options under the Plan.
(b) Accounting for Shares Covered by an Option. For purposes of this
Section 4, the number of Shares covered by an Option shall be counted on the
date of grant of such Option against the aggregate number of Shares available
for granting Options under the Plan.
(c) Adjustments. In the event that the Committee shall determine that any
dividend or other distribution (whether in the form of cash, Shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase or exchange of Shares or other securities of the Company, issuance of
warrants or other rights to purchase Shares or other securities of the Company
or other similar rights to purchase Shares or other securities of the Company or
other similar corporation transaction or event affects the Shares subject to
Option grants under the Plan such that an adjustment is determined by the
Committee to be appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan,
then the Committee shall, in such manner as it may deem equitable, adjust any or
all of(i) the number of Shares which may thereafter be made the subject of
Options; (ii) the number of Shares subject to outstanding Option awards; (iii)
the purchase or exercise price with respect to any Option, provided, however,
that the number of Shares covered by an Option or to which such Option relates
shall always be a whole number.
(d) Incentive Stock Options. Notwithstanding the foregoing, the number of
Shares available for granting Incentive Stock Options under the Plan shall not
exceed 1,200,000, subject to adjustment as provided in the Plan and Section 422
or 424 of the Code or any successor provisions.
SECTION 5
ELIGIBILITY
Any Eligible Person shall be eligible to be designated a Participant. In
determining which Eligible Persons shall receive an Option and the terms of any
Option, the Committee may take into account the nature of the services rendered
by the respective Eligible Persons, their present and potential contributions to
the success of the Company or such other factors as the Committee, in its
discretion, shall deem relevant. Notwithstanding the foregoing, an Incentive
Stock Option may only be granted to fall or part-time employees (which term as
used herein includes, without limitation, officers and directors who are also
employees) and an Incentive Stock Option shall not be granted to an employee of
an Affiliate unless such Affiliate is also a "subsidiary corporation" of the
Company within the meaning of Section 424(f) of the Code or any successor
provision.
SECTION 6
OPTION AWARDS.
The Committee is hereby authorized to grant Options to Participants with
the following terms and conditions and with such additional terms and conditions
not inconsistent with the provisions of the Plan as the Committee shall
determine:
(i) Exercise Price. The purchase price per Share purchasable under an
Option shall be determined by the Committee, provided, however, that such
purchase price shall not be less than 100% of the Fair Market Value of a Share
on the date of grant of such Option, provided further, however, that in the case
of an Incentive Stock Option granted to a Participant who, at the time such
Option is granted, owns Shares of the Company or shares of any subsidiary
corporation or parent corporation of the Company which possesses more than ten
percent (10%) of the total combined voting power of all classes of shares of the
Company or of any subsidiary corporation or parent corporation of the Company
(hereinafter, a "10% Shareholder"), the purchase price for each Share shall be
such amount as the Committee in its best judgment shall determine to be not less
than one hundred ten percent (110%) of the Fair Market Value per Share at the
date the Incentive Stock Option is granted. In determining stock ownership of a
Participant for any purposes under the Plan, the rules of Section 424(d) of the
Code shall be applied, and the Committee may rely on representations of fact
made to it by Participant and believed by it to be true.
(ii) Option Term. The term of each Option shall be fixed by the Committee
which in any event shall not exceed a term (10) years from the date of the
grant, provided, however, that the term of any Incentive Stock Option granted to
any 10% Shareholder shall not be exercisable after the expiration of five (5)
years from the date such Incentive Stock option was granted.
(iii)Maximum Grant of Incentive Stock Options. The aggregate Fair Market
Value (determined on the date the Incentive Stock Option is granted) of Shares
subject to an Incentive Stock Option (when first exercisable) granted to a
Participant by the Committee in any calendar year shall not exceed $100,000.
(iv) Time and Method of Exercise. Subject to the provisions of the Plan,
the Committee shall determine the time or times at which an Option may be
exercised in whole or in part and the method or methods by which, and the form
or forms (including, without limitation, cash, Shares, promissory notes, other
securities, other property, cancellation of credit or amounts due optionee from
Company, or any combination thereof, having a Fair Market Value on the exercise
date equal to the relevant exercise price) in which, payment of the exercise
price with respect thereto may be made or deemed to have been made.
(v) Vesting of Options. Options granted to participants shall either vest
immediately on grant or shall vest over time as follows:
(a) Except as specified by the Committee at the time of grant, as to
Participants that have served the Company for a period of less than five years,
options granted under the Plan shall vest at the rate of 20% thereof for each
year served and 20% per year for each additional year thereafter until a total
of five years has been served by the Participant. At that time, the Option
granted to the Participant shall be deemed fully vested.
(b) As to Participants that have been employed or otherwise served the
Company for a period of five consecutive years or more at the time of the grant
of an Option under the Plan, such Option shall be deemed fully vested at time of
grant.
(c) All Options under the Plan shall be required to be vested prior to
exercise and if the entire option is not fully vested at the time of exercise,
only that portion of the option that is vested shall be exercisable. e.g. If a
participant who has been an employee (as defined) with the Company for three
years is granted an option for one thousand shares and wishes to immediately
exercise it. Under the terms of the Plan, six hundred shares may be exercised
immediately (because the shares vest immediately due to his three years of
service) and as to the other four hundred shares, options to exercise two
hundred shares shall vest and be exercisable during the fourth year of service
with the Company and options for the balance of 200 shares shall vest and be
exercisable during the fifth year that the participant has served with the
Company. After the fifth year of service, any other options received by that
Participant shall vest immediately because participant will have served the
Company for five years at the time of such option grant.
(vi) Limits on Transfer of Options. No Option shall be transferable by a
Participant otherwise than by will or by the laws of descent and distribution;
provided, however, that, if so determined by the Committee, a Participant may,
in the manner established by the Committee, designate a beneficiary or
beneficiaries to exercise the rights of the Participant and receive any Shares
purchased with respect to any Option upon the death of the Participant. Each
Option shall be exercisable during the Participant's lifetime only by the
Participant or, if permissible under applicable law, by the Participant's
guardian or legal representative. No Option or Shares underlying any Option
shall be pledged, alienated, attached or otherwise encumbered, and any purported
pledge, alienation, attachment or encumbrance thereof shall be void and
unenforceable against the Company or any Affiliate.
(vii) Restrictions: Securities Exchange Listing. All certificates for
Shares delivered upon the exercise of Options under the Plan shall be subject to
such stop transfer orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations and other requirements of the
Securities and Exchange Commission and any applicable federal or state
securities laws, and the Committee may cause a legend or legends to be placed on
such certificates to make appropriate reference to such restrictions. If the
Shares or other securities are traded on a national securities exchange, the
Company shall not be required to deliver any Shares covered by an Option unless
and until such Shares have been admitted for trading on such securities
exchange.
(viii) Termination of Employment.
(A) Upon termination of the employment or consultancy, as the case may be,
of any Participant, an Option previously granted to the Participant, unless
otherwise specified by the Committee in the Option, shall, to the extent not
theretofore exercised, terminate and become null and void, provided that:
(a) If the Participant shall die while in the employ of the Company or
during a period after termination of employment as specified in clause (b) below
and at a time when such Participant was entitled to exercise an Option as herein
provided, the legal representative of such Participant, or such Person who
acquired such Option by bequest or inheritance or by reason of the death of the
Participant, may, not later than one (1) year from the date of death, exercise
any non-vested Option which was not theretofore exercised in respect of any or
all of such number of Shares as specified by the Committee in such Option; and
(b)With respect to Participants who are employees, if the employment of any
employee to whom such Option shall have been granted shall terminate by reason
of the Employee's retirement (at such age or upon such conditions as shall be
specified by the Board of Directors), disability (as described in Section
22(e)(3) of the Code) or dismissal by the employer other than for cause (as
defined below), and while such employee Participants entitled to exercise such
option as herein provided, such employee Participant shall have the right to
exercise any non-vested Option held by him (or her), to the extent not
theretofore exercised, in respect of any or all of such number of Shares as
specified by the Committee in such Option, at any time up to and including
twelve (12) months after the date of such termination of employment. In the
event death occurs during the 12 month period after termination for any reason
other than for cause, the time for such optionee's representative to exercise
such option shall extend to one (1) year from date of death of the optionee.
(B) If a Participant voluntarily terminates his or her employment or
consultancy, as the case may be, any non-vested Option granted hereunder shall,
unless otherwise specified by the Committee in the Option, forthwith terminate
with respect to any unexercised portion thereof.
(C) If a Participant is terminated for cause as hereinafter defined, all
vested and non-vested options shall terminate immediately unless otherwise
specified by the committee in the Option or at time of termination.
(D) If an Option granted hereunder shall be exercised by the legal
representative of a deceased or disabled Participant, or by a person who
acquired an Option granted hereunder by bequest or inheritance or by reason of
death of any such person, written notice of such exercise shall be accompanied
by a certified copy of letters testamentary or equivalent proof of the right of
such legal representative or other person to exercise such Option.
(E) For all purposes of the Plan, the term "for cause" shall mean, (i) with
respect to a Participant who is a party to a written employment or consultancy
agreement with the Company, as the case may be, which contains a definition of
"for cause" or "cause" (or words of like import) for purposes of termination of
employment or consultancy thereunder by the Company, "for cause" or "cause" as
defined in the most recent of such agreements, or (ii) in all other cases, as
determined by the Committee, in its sole discretion, that one or more of the
following has occurred: (W) any failure by a Participant to substantially
perform his or her employment or consultancy duties, as the case may be, which
shall not have been corrected within thirty (30) days following written notice
thereof, (X) any engaging by such Participant in misconduct or, in the case of
an officer Participant, any failure or refusal by such officer Participant to
follow the directions of the Company's Board of Directors or Chief Executive
Officer of the Company which, in either case, is injurious to the Company or any
Affiliate, (Y) any breach by a Participant of any covenant contained in the
instrument pursuant to which an Option is granted, or (Z) such Participant's
conviction of or entry of a plea of nolo contendere in respect of any felony, or
of a misdemeanor which results in or is reasonably expected to result in
economic or reputational injury to the Company or any of its Affiliates.
SECTION 7
AMENDMENT AND TERMINATION: ADJUSTMENTS.
Except to the extent prohibited by applicable law and unless otherwise expressly
provided in an Option Agreement or in the Plan:
(a) Amendments to the Plan. The Board of Directors of the Company may
amend, alter, suspend, discontinue or terminate the Plan; provided, however,
that, notwithstanding any other provision of the Plan or any Option Agreement,
without the approval of the stockholders of the Company, no such amendment,
alteration, suspension, discontinuation or termination shall be made that,
absent such approval:
(i) would cause Rule 16b-3 to become unavailable with respect to the Plan;
(ii) would violate the rules or regulations of any national securities
exchange on which the Shares of the Company are traded or the rules or
regulations of the National Association of Securities Dealers, Inc. that are
applicable to the Company; or
(iii) would cause the Company to be unable, under the Code, to grant
Incentive Stock Options under the Plan.
(b) Amendments to Option Grants. The Committee may waive any conditions or
rights of the Company under any outstanding Option grant, prospectively or
retroactively. The Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Option grant, prospectively or retroactively, without
the consent of the Participant or holder or beneficiary thereof, except as
otherwise herein provided.
(c) Correction of Defects, Omissions and Inconsistencies. The Committees
may correct any defect, supply any omission or reconcile any inconsistency in
the Plan or any Option in the manner and to the extent it shall deem desirable
to carry the Plan into effect.
SECTION 8
INCOME TAX WITHHOLDING: TAX BONUSES.
(a) Withholding. In order to comply with all applicable federal or state
income tax laws or regulations, the Company may take such action as it deems
appropriate to ensure that all applicable federal or state payroll, withholding,
income or other taxes, which are the sole and absolute responsibility of a
Participant, are withheld or collected from such Participant. In order to assist
a Participant in paying all or a portion of the federal and state taxes to be
withheld or collected upon exercise of any Option, the Committee, in its
discretion and subject to such additional terms and conditions as it may adopt,
may permit the Participant to satisfy such tax obligation by (i) electing to
have the Company withhold a portion of the Shares otherwise to be delivered upon
exercise of any Option with a Fair Market Value equal to the amount of such
taxes or (ii) delivering to the Company Shares other than the Shares issuable
upon exercise of the applicable Option with a Fair Market Value equal to the
amount of such taxes. The election, if any, must be made on or before the date
that the amount of tax to be withheld is determined.
(b) Tax Bonuses. The Committee, in its discretion, shall have the
authority, at the time of grant of any Option under this Plan or at any time
thereafter, to approve cash bonuses to designated Participants to be paid upon
their exercise in order to provide funds to pay all or a portion of federal and
state taxes due as a result of such exercise. The Committee shall have lull
authority in its discretion to determine the amount of any such tax bonus.
SECTION 9
GENERAL PROVISIONS.
(a) No Rights to Option Grants. No Eligible Person, Participant or other
Person shall have any claim to be granted an Option under the Plan, and there is
no obligation for uniformity of treatment of Eligible Persons, Participants or
holders or beneficiaries of Options granted under the Plan. The terms and
conditions of Options need not be the same with respect to any Participant or
with respect to different Participants.
(b)Option Certificates. No Participant will have rights under an Option
granted to such Participant unless and until an Option Certificates shall have
been duly executed by the Company. Each Option Certificates shall set forth the
terms and conditions of any Option granted to a Participant consistent with the
provisions of this Plan.
(c) No Limit on Other Compensation Arrangements. Nothing contained in the
Plan shall prevent the Company or any Affiliate from adopting or continuing in
effect other or additional compensation arrangements, and such arrangements may
be either generally applicable or applicable only in specific cases.
(d) No Right to Employment. The grant of an Option shall not be construed
as giving a Participant the right to be retained in the employ of the Company or
any Affiliate, nor will it affect in anyway the right of the Company or an
Affiliate to terminate such employment at any time, with or without cause. In
addition, the Company or an Affiliate may at any time dismiss a Participant from
employment free from any liability or any claim under the Plan, unless otherwise
expressly provided in the Plan or in any Option Agreement.
(e) Governing Law. The validity, construction and effect of the Plan or any
Option granted hereunder, and any rules and regulations relating to the Plan or
any Option granted hereunder, shall be determined in accordance with the laws of
the State of Delaware except to the extent preempted by Federal law.
(f) Severability. If any provision of the Plan or any Option is or becomes
or is deemed to be invalid, illegal or unenforceable in any jurisdiction or
would disqualify the Plan or any Option under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in
the determination of the Committee, materially altering the purpose or intent of
the Plan or the Option, such provision shall be stricken as to such jurisdiction
or Option, and the remainder of the Plan or any Option shall remain in full
force and effect.
(g) Section Headings. The section headings included herein are only for
convenience, and they shall have no effect on the interpretation of the Plan.
SECTION 10
EFFECTIVE DATE OF THE PLAN.
The Plan shall be effective on January 21, 2003 (the "Plan Effective Date"),
subject to approval by the Company's stockholders within one (1) year
thereafter.
SECTION 11
TERM OF THE PLAN.
Unless the Plan shall have been discontinued or terminated as provided in
Section 7(a), the Plan shall terminate on January 20, 2013. No Option shall be
granted after the termination of the Plan. However, unless otherwise expressly
provided in the Plan or in an applicable Option Certificate, any Option
theretofore granted may extend beyond the termination of the Plan, and the
authority of the Committee provided for hereunder with respect to the Plan and
any Option grants, and the authority of the Board of Directors of the Company to
amend the Plan, shall extend beyond the termination of the Plan.
IN WITNESS WHEREOF, this Plan has been executed at Melville, N.Y on this 21st
day of January, 2003.
Bovie Medical Corporation
By S/Andrew Makrides
Andrew Makrides, President
and Chief Executive Officer
Bovie Medical Corporation
A Delaware Corporation
FORM OF STOCK OPTION
Name of Optionee Date Option Granted
Address No. ________
This option ("Option") is made as of the date set forth above by Bovie Medical
Corporation, a Delaware corporation (hereinafter the "Company"), and the
Optionee named above (hereinafter "Optionee"). The option granted hereby is
granted pursuant to the Bovie Medical Corporation 2003 Executive and Employee
Stock Option Plan dated January 21, 2003 (the "Plan").
1.Grant of Option. Pursuant to and subject to the terms and conditions of
the Plan, the Company grants to the Optionee the right and option (the "Option")
to purchase at $.__ per share on the terms and conditions hereinafter set forth
all or any part of an aggregate of________ shares (the "Shares") of the
currently authorized and unissued Common Stock, par value $.OO1 per share.
Subject to the terms of the Plan, the Option shall be exercisable, in whole or
in part, during the period commencing with the date on which it is granted and
ending on ________ , 20___.
Nothing contained herein shall be construed to limit or restrict the right
of the Company or a parent or subsidiary corporation of the Company to terminate
the Optionee's services for the Company.
2.Vesting of Option. The option granted hereby shall vest at the rate of
20% of the amount of the grant for each year of employment up to a total of five
years at which time the option becomes fully vested. Each Optionee is able to
apply his (her) prior years of employment in order to achieve immediate vesting
of a portion or all of the options granted hereby, depending upon the total
years of prior employment. Accordingly, if an Optionee has been employed by the
Company for three years at the time he (she) receive this option, then a total
of 60% of this option is deemed fully vested to the extent of 60% of such
option. For each additional year employed, an additional 20% of the option
granted hereby shall vest until a total of 5 years of employment (including
employment prior to the grant of this option) will have occurred. At that time,
the option will be deemed fully vested.
3. Exercisability of Option. All options granted under the plan shall be
exercisable during the term of the option provided the option is fully vested or
the Optionee is employed by the Company at the time of exercise. In the event
the option is not fully vested or the Optionee is no longer an employee of the
Company at the time of exercise, then the provisions of paragraph 5 shall apply.
4. Method of Exercise. The Option may be exercised pursuant thereto by
written notice to the Company stating the number of shares with respect to which
the option is being exercised, together with payment in full, (a) in cash or
certified check; (b) or acknowledgement of cancellation of the Company's
indebtedness to the Optionee for services or otherwise; or (c) any combination
of the foregoing. If requested by the Board of Directors, prior to the delivery
of any Shares, the Optionee shall supply the Board of Directors with a
representation that the Shares are not being acquired with a view to unlawful
distribution and will be sold or otherwise disposed of only in accordance with
applicable federal and state statutes, rules and regulations.
As soon after the notice of exercise as the Company is reasonably able to
comply, the Company shall, without payment of any transfer or issue tax by the
Optionee, deliver to the Optionee or any such other person, at the main office
of the company or such other place as shall be mutually acceptable, a
certificate or certificates for the Shares being purchased upon exercise of the
Option. Notwithstanding the foregoing, the Company shall have the right to
postpone the time of delivery of the Shares for such period as may be required
for it with reasonable diligence to comply with any applicable listing
requirements of any national securities exchange or any federal, state or local
law. The Optionee may exercise the Option for less than the total number of
Shares for which the Option is then exercisable, provided that a partial
exercise may not be for fewer than 100 Shares, unless the remaining shares
exercisable under the Option is for less than 100 Shares. The Option may be
exercisable for whole Shares only.
5. Termination of Option. The Option shall terminate and expire immediately
as to the total number of remaining unexercised option shares at the expiration
date of the option. In addition, the option shall automatically terminate upon
the earlier of the following:
(i)Immediately upon termination of the Optionee's employment with the Company
for cause (as defined under the Plan) regardless of whether the option is vested
or non-vested;
(ii) If the option is not vested, at the expiration of twelve (12) months after
of termination of the Optionee's employment by the Company for any other reason,
as such term is defined under the Plan; provided, that if the Optionee dies
within such twelve-month period, subclause (iii) below shall apply; or
(iii) At the expiration of twelve (12) months after the date of death of the
Optionee, if the Option is not vested.
(iv) On the effective date of voluntary termination with the Company by the
Participant if the Option is not vested.
(v) Except for termination for cause, all vested options, as defined in the
Plan, shall expire upon the expiration date set forth in Paragraph 1 hereof.
6.Adjustments. If there is any change in the capitalization of the Company
affecting in any manner the number or kind of outstanding shares of Common Stock
of the Company, whether by stock dividend, stock split, reclassification or
recapitalization of such stock, or because the Company has merged or
consolidated with one or more other corporations (and provided the Option does
not thereby terminate pursuant to Section 5 hereof), then the number and kind of
shares then subject to the Option and the price to be paid therefore shall be
appropriately adjusted by the Board of Directors; provided, however, that in no
event shall any such adjustment result in the Company's being required to sell
or issue any fractional shares. Any such adjustment shall be made without change
in the aggregate purchase price applicable to the unexercised portion of the
option, but with an appropriate adjustment to the price of each Share or other
unit of security covered by this Option.
7.Cessation of Corporate Existence. Notwithstanding any other provision of
this Option, upon the dissolution or liquidation of the Company, the
reorganization, merger or consolidation of the Company with one or more
corporations as a result of which the Company is not the surviving corporation,
or the sale of substantially all the assets of the Company or of more than 50%
of the then outstanding stock of the Company to another corporation or other
entity, the option granted hereunder shall terminate; provided, however, that:
(i) each option for which no option has been tendered by the surviving
corporation in accordance with all of the terms of provision (ii) immediately
below shall, within five days before the effective date of such dissolution or
liquidation, merger or consolidation or sale of assets in which the Company is
not the surviving corporation or sale of stock, become fully exercisable; or
(ii) in its sole and absolute discretion, the surviving corporation may, but
shall not be so obligated to, tender to any Optionee, an option to purchase
shares of the surviving corporation, and such new option or options shall
contain such terms and provisions as shall be required substantially to preserve
the rights and benefits of this option.
8. Non-Transferability. The Option is not assignable or transferable by the
Optionee, either voluntarily or by operation of law, otherwise than by will or
by the laws of descent and distribution, and is exercisable, during the
Optionee's lifetime, only by the Optionee. Upon any attempted transfer of this
Option contrary to the provisions hereof, the Board of Directors may, at its
discretion, terminate this option.
9. No Stockholder Rights. The Optionee or other person entitled to exercise
this option shall have no rights or privileges as a stockholder with respect to
any Shares subject hereto until the Optionee or such person has become the
holder of record of such Shares, and no adjustment (except such adjustment as
may be effected pursuant to the provisions of Section 4 hereof) shall be made
for dividends or distributions of rights in respect of such Shares if the record
date is prior to the date on which the Optionee or such person becomes the
holder of record.
Executed by the Company as of this _____ day of _______________, 2003.
Bovie Medical Corporation
a Delaware corporation
By:___________________________
Date
(Printed Name) (As Registered)
(Address)
Date
BOVIE MEDICAL CORPORATION
PROXY
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JULY 30, 2003
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Andrew Makrides and George W. Kromer, Jr., and
each of them, Proxies with power of substitution each, for and in the name of
the undersigned, and hereby authorize them to represent and to vote, all the
shares of common stock of Bovie Medical Corporation, a Delaware corporation
("Company"), that the undersigned would be entitled to vote at the Company's
Annual Meeting of Stockholders ("Annual Meeting") on July 30, 2003 and at any
adjournments thereof, upon the matters set forth in the Notice of Annual
Meeting, hereby revoking any Proxy heretofore given. The Proxies are further
authorized to vote in their discretion upon such other business as may properly
come before the Annual Meeting. This proxy will be voted as specified. If no
direction is made, this proxy will be voted in favor of all proposals.
THE BOARD RECOMMENDS A VOTE "FOR" EACH NOMINEE AND FOR PROPOSALS 2 AND 3.
1. Election of Directors (check one box only)
FOR [ ] AGAINST [ ]
EACH NOMINEE LISTED:
Andrew Makrides
J. Robert Saron
Alfred V Greco
George W. Kromer, Jr.
(Instruction: To withhold authority to vote for any nominee, circle that
nominee's name in the above list)
(Continued and to be signed and dated on reverse side)
(Back of Proxy)
PROXY
(Please sign and date below)
2. To ratify the selection of BLOOM & COMPANY as independent auditors for the
Company. FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. To approve the Company's 2003 Executive and Employee Stock Option Plan.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
I (We) will[ ] will not [ ] attend the meeting in person.
Dated:_________________________, 2003
__________________________
(Please Print Name)
_________________________
(Signature of Stockholder) (Title, if applicable)
___________________________
(Please Print Name)
_______________________________
(Signature of Stockholder) (Title, if applicable)
NOTE: PLEASE SIGN YOUR NAME OR NAMES EXACTLY AS SET FORTH HEREON. FOR JOINTLY
OWNED SHARES, EACH OWNER SHOULD SIGN. IF SIGNING AS ATTORNEY, EXECUTOR,
COMMITTEE, TRUSTEE OR GUARDIAN, PLEASE INDICATE THE CAPACITY IN WHICH YOU ARE
ACTING. PROXIES EXECUTED BY CORPORATIONS SHOULD BE SIGNED BY A DULY AUTHORIZED
OFFICER. PLEASE DATE AND SIGN THIS PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED
ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.