UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT
( PURSUANT TO SECTION 14(A) OF
SECURITIES EXCHANGE ACT OF 1934)
(AMENDMENT NO.___ )
FILED BY REGISTRANT _XX_
FILED BY A PARTY OTHER THEN REGISTRANT
CHECK THE APPROPRIATE BOX:
___PRELIMINARY PROXY STATEMENT (PRER14A)
___CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY
(AS PERMITTED BY RULE 14A-6(E)(2)
_X_DEFINITIVE PROXY STATEMENT
___DEFINITIVE ADDITIONAL MATERIALS
___SOLICITING MATERIAL PURSUANT TO SECTION 240.14A-11(C) OR SECTION 240.14A-12
HYDROMER, INC.
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(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THEN REGISTRANT)
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PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
_X_ NO FEE REQUIRED
___ FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES 14A-6(I)(1) AND 0-11.
1) TITLE OF EACH CLASS OF SECURITIES TO WHICH TRANSACTION APPLIES: COMMON
STOCK
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2) AGGREGATE NUMBER OF SECURITIES TO WHICH TRANSACTION APPLIES: 4,587,987
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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
FILING FEE IS CALCULATED AND STATE HOW IT WAS DETERMINED):
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4) PROPOSED MAXIMUM AGGREGATE VALUE OF TRANSACTION:
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5) TOTAL PAID:
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___ FEE PAID PREVIOUSLY WITH PRELIMINARY MATERIAL:
___ CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY THE 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 FORM OR SCHEDULE AND THE DATE OF ITS FILING.
1) AMOUNT PREVIOUSLY PAID:
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2) FORM, SCHEDULE OR REGISTRATION NO.:
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3) FILING PARTY:
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4) DATE FILED:
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HYDROMER, INC.
35 Industrial Parkway
Branchburg, NJ 08876-3518
NOTICE OF 2001 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD NOVEMBER 14, 2001
The Annual Meeting of the Shareholders of HYDROMER, Inc. (the "Company") will be
held on Wednesday, November 14, 2001, at 35 Industrial Parkway, Branchburg, New
Jersey at 10 o'clock a.m. for the following purpose, as more fully described in
the accompanying Proxy Statement:
1. To elect directors of the Company for the ensuing year.
2. To ratify the selection by the Board of Directors of Rosenberg Rich
Baker Berman & Company as the Company's independent accountants for
fiscal 2001/2002.
3. Transact such other business as may properly come before the
meeting or any adjournment thereof.
The close of business on September 1, 2001 has been fixed by the Board
of Directors as the record date for the determination of shareholders
entitled to notice of, and to vote at the Meeting.
By Order of the Board of Directors
Robert J. Moravsik
-----------------------------
Robert J. Moravsik, Secretary
Branchburg, New Jersey
September 14, 2001
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE
AND SIGN THE ENCLOSED PROXY CARD AND PROMPTLY MAIL IT IN THE ENCLOSED
ENVELOPE IN ORDER TO ASSURE REPRESENTATION OF YOUR SHARES AT THE
MEETING. NO POSTAGE NEED BE AFFIXED IF PROXY CARD IS MAILED IN THE
UNITED STATES.
TABLE OF CONTENTS
QUESTIONS AND ANSWERS .............................................................. 1
PROXY STATEMENT .................................................................... 3
I. ELECTION OF DIRECTORS (Proposal I) ............................................. 3
Name of Nominee ........................................................... 3
Executive Officers ........................................................ 5
Compensation of Executive Officers ........................................ 6
Stock Options ............................................................. 7
Certain Arrangements with Directors and Executive Officers ................ 7
Information Concerning Certain Shareholders ............................... 8
Other Information ......................................................... 9
II. RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS (Proposal II) ..... 9
III. OTHER MATTERS ................................................................. 9
IV. MISCELLANEOUS ................................................................. 9
V. EXCHANGE ACT COMPLIANCE .......................................................10
VI. SHAREHOLDER PROPOSALS .........................................................10
i
HYDROMER, Inc.
35 Industrial Parkway
Branchburg, NJ 08876
PROXY STATEMENT
QUESTIONS AND ANSWERS ABOUT HYDROMER ANNUAL
MEETING AND VOTING.
WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
At the annual meeting, the stockholders will elect 8 directors and act upon
anything else that properly comes before the meeting. In addition, the
management will give a report on the performance during the fiscal year
beginning July 1, 2000 and ending June 30, 2001.
WHY DID I RECEIVE THIS PROXY STATEMENT?
We sent you this proxy statement and the enclosed proxy card because Hydromer's
Board of Directors is soliciting your proxy to be used at the annual meeting of
stockholders on November 14, 2001, at 10:00 a.m. (EST), at 35 Industrial
Parkway, Branchburg, NJ 08876, or at any adjournment of the meeting. This proxy
statement discloses the information you need to know to vote on an informed
basis. We are first mailing this proxy statement and the enclosed proxy card to
stockholders on or about September 14, 2001.
WHO CAN VOTE?
You are entitled to vote if you owned Hydromer common stock on the record date,
which is the close of business on September 1, 2001. Each share of Hydromer
common stock that you own entities you to one vote.
WHO CAN ATTEND THE MEETING?
Only stockholders of record on the close of business on the record date, or
their duly appointed proxies, may attend the meeting. Registration begins at
9:30am.
HOW MANY SHARES OF VOTING STOCK ARE OUTSTANDING?
On the record date, there were 4,587,987 shares of Hydromer common stock
outstanding. Hydromer common stock is our only class of voting stock.
WHAT CONSTITUTES A QUORUM?
A quorum is a majority of the outstanding shares entitled to vote which are
present or represented by proxy at the meeting ie 2,293,994 shares. There must
be a quorum for the transaction of business at the annual meeting. If you submit
a properly executed proxy card, even if you abstain from voting, your shares
will be considered part of the quorum. Broker non-votes (shares held by a broker
or nominee that are represented at the meeting, but with respect to which the
broker or nominee is not empowered to vote on a proposal) are also included in
determining the presence of a quorum.
WHAT AM I VOTING ON?
1. The election of eight individuals to serve on our Board of Directors:
Manfred F. Dyck, Ursula M. Dyck, Dieter Heinemann, Robert Bea,
Dr. Maxwell Borow, Dr. Klaus, J.H. Meckeler,
Dr. Frederick Perl and Dr. Gaylord McKissick.
2. The ratification of the selection of Rosenberg Rich Baker Berman &
Company as our independant auditors for the fiscal year beginning July
1, 2001.
1
HOW DOES THE BOARD OF DIRECTORS RECOMMEND I VOTE ON THE PROPOSALS?
The Board of Directors, recommends a vote FOR each of the Board's nominees and
FOR the appointment of Rosenberg Rich Baker Berman & Company as our independent
auditors for fiscal 2001/2002.
HOW DO I VOTE?
To vote by proxy you should complete, sign and date the enclosed proxy card and
return it promptly in the prepaid envelope provided with this proxy statement.
To vote in person, you may attend the meeting and cast your vote in person.
MAY I REVOKE MY PROXY?
You may revoke your proxy at any time before it is voted in either of the
following ways:
1. You May Submit another proxy card with a later date.
2. You may notify Hydromer's Secretary in writing before your proxy is
voted that you have revoked your proxy.
IF I PLAN TO ATTEND THE MEETING, SHOULD I STILL VOTE BY PROXY?
Whether you plan to attend the meeting or not, we urge you to vote by proxy.
Returning the proxy card will not affect your right to attend the meeting, and
your proxy will not be used if you are personally present at the meeting and
inform the Secretary in writing prior to the voting that you wish to vote your
shares in person. The Secretary will have proxy revocation forms at the meeting
in case you want to revoke your proxy and vote in person.
HOW WILL MY PROXY BE VOTED?
If you properly fill in your proxy card and send it to us, your proxy holder
(one of the individuals named on your proxy card) will vote your shares as you
have directed. Under the rules of the various exchanges, if your broker is a
member of the exchange and holds your shares in its name, the broker may vote
your shares on Proposals 1 and 2 if it does not receive instructions from you.
IF YOU SIGN THE PROXY CARD BUT DO NOT MAKE SPECIFIC CHOICES, THE PROXY HOLDER
WILL VOTE YOUR SHARES AS RECOMMENDED BY THE BOARD OF DIRECTORS AS FOLLOWS:
"FOR" the election of all nominees for director,
"FOR" ratification of the selection of independent auditors
for 2001/2002
WHAT VOTE IS REQUIRED TO APPROVE PROPOSALS?
Directors are elected by a plurality of the shares voting at the meeting. If you
do not vote for a particular nominee, or you indicate "withhold authority to
vote" for a particular nominee on your proxy, your vote will not count either
"for" or "against" the nominee. A "broker non-vote" will also have no effect on
the outcome.
HOW WILL VOTING ON ANY OTHER BUSINESS BE CONDUCTED?
Although we do not know of any business to be considered at the meeting other
than the proposals described in this proxy statement, if any other business is
presented at the meeting, your returned proxy gives authority to proxy holders
to vote on these matters in their discretion.
2
PROXY STATEMENT
This Proxy Statement, which will be mailed commencing on or about September 14,
2001 to the persons entitled to receive the accompanying Notice of Annual
Meeting of Shareholders, is provided in connection with the solicitation of
Proxies on behalf of the Board of Directors of HYDROMER, INC. for use at the
Annual Meeting of Shareholders to be held at 35 Industrial Parkway, Branchburg,
New Jersey at 10 o'clock a.m. on November 14, 2001 and at any adjournment
thereof, for the purposes set forth in such Notice. The Company's executive
office is also located at 35 Industrial Parkway, Branchburg, New Jersey
08876-3518.
At the close of business on September 1, 2001, the record date stated in the
accompanying Notice, the Company had 4,587,987 outstanding shares of Common
Stock without par value ("Common Stock"), each of which is entitled to one vote
with respect to each matter to come before the Meeting. The Company has 10,917
shares of Common Stock, which are Treasury Stock and not entitled to vote. The
Company has no class or series of stock outstanding other than the Common Stock.
As of September 1, 2001, Manfred F. Dyck, Chairman of the Board and a director
of the Company, beneficially owned approximately 34.3% of the outstanding Common
Stock of the Company, and his wife Ursula M. Dyck, a director of the Company,
beneficially owned an additional 3.6% of the Common Stock. In addition, Mr.
Dieter Heinemann, a director of the Company owns 13.1% of the outstanding Common
Stock of the Company. Such ownership may enable such shareholders to exercise a
controlling influence over the Company's affairs.
I. ELECTION OF DIRECTORS (PROPOSAL I)
Eight directors will be elected at the Annual Meeting of Shareholders, each to
serve for one year and until a successor shall have been duly chosen and
qualified. Each director is elected by a plurality of votes cast. It is the
intention of each of the persons named in the accompanying form of Proxy to vote
the shares represented thereby in favor of the eight nominees listed in the
following table, unless otherwise instructed in the Proxy. In case any of the
nominees is unable or declines to serve, such persons reserve the right to vote
the shares represented by such Proxy for another person duly nominated by the
Board of Directors in his or her stead or, if no other person is so nominated,
to vote such shares only for the remaining nominees. The Board of Directors has
no reason to believe that any person named will be unable or will decline to
serve. Certain information concerning the nominees for election as directors is
set forth below. Such information was furnished by them to the Company.
NAME OF NOMINEE AND CERTAIN
BIOGRAPHICAL INFORMATION
MANFRED F. DYCK, age 66; Chief Executive Officer of Biosearch Medical Products,
Inc. (manufacturer and distributor of medical devices) since 1975; Chairman of
the Board of the Company since June 1983 and Chief Executive of the Company
since July of 1989; President from 1980 to June 1983; Director of Biosearch
Medical Products Inc. since 1975; Director of the Company since 1980. Manfred
and Ursula Dyck are husband and wife.
MAXWELL BOROW, M.D., age 75, Medical Doctor, retired Chief of Surgery at
Somerset Medical Center (hospital) from 1985-1994, Chief of Vascular Surgery at
Somerset Medical Center from 1978-1985; Director of the Company since 1990.
URSULA M. DYCK, age 67; Director of the Company since 1980. Ursula and Manfred
Dyck are wife and husband.
DIETER HEINEMANN, age 63; Specialist, Frankfurt, Germany Stock Exchange since
prior to 1987. Director of the Company since 1991.
ROBERT H. BEA, age 48; Vice President, Regulatory and Quality Assurance, Siemens
Medical Systems, Inc. since 1994; Vice President of Quality Assurance and
Regulatory Affairs of Biosearch Medical Products, Inc. from 1992-1994;
Previously, he worked at Johnson & Johnson where he held positions of increasing
responsibility in Quality/Regulatory affairs from 1973-1991. Director of the
Company since 1996.
3
FREDERICK A. PERL, MD, age 73, Attending staff, Somerset Medical Center since
1957; Consulting staff Obstetrics and Gynecology, Carrier Clinic since 1959;
Affiliated with St. Peter's Medical Center, active staff Since 1994, Director of
Biosearch Medical Products since December 1996 and then appointed to the Board
of the Company in February 2000.
KLAUS J.H. MECKELER, M.D. age 67; Clinical Professor of Medicine UMDNJ, Robert
Wood Johnson Medical School, Former Chief of Gastroenterology and Director of
Endoscopic Clinic (a clinic specializing in gastrointestinal disorders) Somerset
Medical Center, since 1966; Director of Biosearch Medical Products since January
1984 and appointed to the Board of the Company in February 2000.
GAYLORD E. McKISSICK, VMD, PhD age 69, Consultant to Merck & Co., St. Joseph's
Hospital,Scotch Plains Zoo, M. White's Deer Farm;prior to 1995 he served as
Senior Investigator for Merck & Co. Since February of 1999 Dr. McKissick has
served as a consultant to the Company in respect to its animal health products,
particularly, T-Hexx(R)cow teat dip and was appointed to the Board of the
Company in February 2000.
NAME Stock Owned (1) %
On Record Date
MANFRED F. DYCK, 1,572,037 (2) 34.3%
MAXWELL BOROW, M.D 14,000 (5) Less than 1%
URSULA M. DYCK, 165,000 (3) 3.6%
DIETER HEINEMANN, 600,030 (4) 13.1%
ROBERT H. BEA - 0 - (6)
KLAUS J.H. MECKELER - 0 - (7)
FREDERICK L. PERL - 0 - "
GAYLORD E. McKISSICK - 0 - "
-
(1) As of September 1, 2001, except as otherwise indicated below, each nominee
has sole voting and investment power with respect to all shares shown in the
table as beneficially owned by such nominee.
(2) Includes an aggregate of 30,300 shares held by Mr. Dyck as custodian for
certain of his children/grandchildren and does not include 209,708 shares held
with sole voting investment power by Mr. Dyck's children and relatives of Mr.
Dyck's, as to which Mr. Dyck disclaims beneficial ownership, or shares held by
Ursula M. Dyck, his wife. Excludes 137,854 options held by Mr. Dyck.
(3) Does not include 163,556 shares held with sole voting and investment power
by Mrs. Dyck's children, as to which Mrs. Dyck disclaims beneficial ownership,
or shares held by Manfred F. Dyck, her husband, individually or as custodian.
Includes 30,000 shares held by Mrs. Dyck as custodian for her grandchildren.
Excludes 26,000 options held by Mrs. Dyck.
(4) Does not include 135,000 shares held by the wife and children of Mr.
Heinemann as to which he disclaims beneficial ownership. Excludes 26,000 options
held by Mr. Heinemann.
(5) Excludes 19,000 options held by Dr. Borow
(6) Excludes 26,000 options held by Mr. Bea
(7) Excludes 24,000 options held by Dr. Meckeler, Dr. Perl and Dr. McKissick
During the past year, the Board of Directors of the Company met four times. All
Directors attended at least 75% of the meetings.
4
Since May of 1990, directors have been compensated at the rate of $750 per
meeting for directors meetings attended in person, and $200 per meeting for
telephone conference meetings. In addition, directors may attend operational
meetings with Company management, and will be compensated at the rate of $500
per meeting for attendance at such meetings. No such operational meetings were
held in the fiscal year 2000/2001.
The Board of Directors of the Company does not have a separate Nominating
Committee or Compensation Committee. These functions are performed by the Board
at its meetings.
AUDIT COMMITTEE
On October 24, 2000 the Board formed an audit committee consisting of the
outside directors, Robert Bea (Chairman), Dr. Maxwell Borow, Dr. Klaus Meckeler,
Dr. Frederick Perl & Dr. Gaylord McKissick. The committee did not issue any
reports for the fiscal year ending June 30, 2001.
EXECUTIVE OFFICERS
Manfred F. Dyck has been Chairman of the Board of the Company since June 1983
and a Director of the Company since its inception. Mr. Dyck served as Chief
Executive Officer of the Company from its inception until October 1986, and as
of August 1989, reassumed the duties of Chief Executive Officer. Mr. Dyck has
been Chief Executive Officer and a Director of Biosearch Medical Products Inc.
since 1975. He holds a B.S. in Chemical Engineering.
Robert J. Moravsik has been Vice-President and General Counsel since April 1998
and Senior Vice President, General Counsel and Secretary since February 2000. He
also serves in the same capacity for Biosearch Medical Products, Inc. (a wholly
owned subsidiary as of February 2000) since 1987. Prior to this he was
Vice-President and General Counsel to Fisher Stevens, Inc., a subsidiary of the
Bureau of National Affairs. Mr. Moravsik is admitted to practice in the states
of New Jersey and New York, the Federal District Court of New Jersey and the
United States Supreme Court. He holds a B.S. in Aerospace Engineering, an M.S.
in Computer Science and a J.D. in Law.
Martin C. Dyck has been Vice President of Operations of the Company since
February 2000 and Executive Vice President since June 2001. He also serves as
President of the Company's wholly owned subsidiary, Biosearch Medical Products,
Inc Since 1998. Prior to that he served as Vice President of Operation. Martin
C. Dyck is the son of Mr. Manfred F. Dyck and Mrs. Ursula M. Dyck. He holds a
B.S. in Finance with a minor in Mechanical Engineering.
Joseph A. Ehrhard has been Vice-President of New Business and R&D since February
1998 and Executive Vice President of New Business since June 2001. Prior to
joining Hydromer, Mr. Ehrhard was Director of R&D for the Golden Cat Division of
Ralston-Purina in St. Louis, Mo. Mr. Ehrhard holds a B.S. in Chemical
Engineering and Material Science.
Rainer Gruening has been Vice President of R&D since June 2001. Prior to this he
held the position of Manager of Regulatory Affairs in AM Cosmetics. Mr. Gruening
has a PhD in Chemistry from the University of Marburg in Germany.
Robert Y. Lee, CPA, has been Principal Accounting Officer since June 1, 2001.
Prior to this he was Controller for a Technical Start-up Company. Mr. Lee holds
BS in Accounting and Information Systems and a MBA in Finance and International
Business.
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth information concerning cash compensation paid or
accrued by the Company during the fiscal year ended June 30, 2001, to the CEO
and for each of the executive officers of the Company whose total cash
compensation exceeded $100,000.
5
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
Name and Other Annual Restricted
Principle Compensation($) Stock Options LTIP All other
Position Year Salary Bonus (2) Awards /SAR Payouts Compensation
Manfred F. Dyck 2001 210,385 - 5,000 - 71,314 - -
Chairman, 2000 238,846(1) - 5,000 13,000
President, CEO 1999 100,000 - 5,000 53,540
Joseph A. Ehrhard 2001 114,968 - 9,000 21,105
Exec. VP 2000 109,200 4,885 9,000 15,000
1999 104,000 11,424 9,000 16,180
Martin C. Dyck 2001 119,770 29,109 5,000 21,105
Exec. VP 2000 85,582 23,221 4,200 10,000
Robert J. Moravsik 2001 111,308 - 5,000 21,105
Senior VP
The aggregate value of restricted shares of the Company held by Manfred F. Dyck
as of June 30, 2001 was approximately $2,387,154 (based on a market price of
$1.46/share and includes only shares held directly, does not include options or
shares held as custodian.)
(1) Mr. Manfred Dyck's salary at Hydromer was $195,000 for the year ending June
30, 2000. Upon the acquisition of Biosearch Medical Products in February 2000,
Mr. Dyck was owed $43,846 in salary accrued while CEO of Biosearch but not paid.
This liability was paid by Hydromer, Inc. For the fiscal year ending June 30,
1999 Mr. Dyck salary of $100,000 was based on working 5 days per month for
Hydromer. (see "Certain Arrangements with Directors and Executive Officers")
(2) Amount of Automobile Allowance, which was paid in the year shown.
(3) As part of a stock option plan covering active Directors, Mr. Dyck was
awarded 5000 options to purchase stock at $0.75 on October 21, 1998; 5000 at
$0.80 on Nov. 11, 1999 and 8000 on November 14, 2001 (see "Stock Options"). In
addition as part of a stock plan for the C.E.O, 48,540 options were awarded on
August 21, 1999 at a share price of $1.00 (see also "Stock Options") and none
for the fiscal year ending June 30, 2001 and for the fiscal year ending June 30,
2001 Mr. Dyck was awarded 63,314 options at $1.46/share, such options fully vest
in two years.
6
STOCK OPTIONS
In 1984 the Board of Directors conferred upon Manfred F. Dyck, Chairman of the
Board of the Company, the authority to grant to employees of the Company
including executive officers, options to purchase up to 15,000 shares of the
Common Stock of the Company at an exercise price of $1.00 per share, and upon
such other terms and conditions as the Chairman may determine. No such options
were granted during the 1999 fiscal year.
On January 22, 1998 the Board of Directors authorized a stock option plan
effective July 1, 1998 for senior management. Under the plan, senior management
would be issued stock options in an amount equal to 3% of the incremental market
cap of the Company (defined as # of outstanding shares times share price) on
June 30th in each of the next three years. These options would be equally
divided between the number of participants in the plan. As of June 30, 2001,
there were three participants. No awards were given for the fiscal year ending
June 30, 2000 as the capitalization declined from June 30, 1999.
These option are in effect for 5 years. 20% vest immediately and the remaining
80% vest over the following 8 quarters. Options issued under the plan were:
Name Date Number of Options Price
Robert J. Moravsik, VP June 30, 1999 16,180 1.00
Joseph A. Ehrhard, VP June 30, 1999 16,180 1.00
Robert J. Moravsik, VP June 30, 2000 0
Joseph A. Ehrhard, VP June 30, 2000 0
Martin C. Dyck, VP June 30, 2000 0
Robert J. Moravsik, VP June 30, 2001 21,105 1.46
Joseph A. Ehrhard, VP June 30, 2001 21,105 1.46
Martin C. Dyck, VP June 30, 2001 21,105 1.46
On January 22, 1998 the Board of Directors also authorized a similar stock
option plan for Manfred Dyck, Chairman and CEO effective July 1, 1998. Under the
plan, he would be issued stock options in an amount equal to 3% of the
incremental market cap of the Company (defined as # of outstanding shares times
share price) on June 30th in each of the following three years. See Compensation
of Executive Officers for the awards under this plan.
In August 2001 the Board extended these stock option plans for Senior Management
and the President for three more years ending June 30, 2004 under the same terms
except the plan for senior management now includes 5 members (5%).
On January 22, 1998 the Board of Directors approved an option plan for active
directors (an active director attends all the meetings of the Board) that would
give each active director of the Company 5,000 options with a strike price on
September 1, 1998, and each subsequent year on the record date. On February 22,
2000 the option plan was amended to grant each director 2000 options for each
meeting attended to be awarded at the annual meeting. The price shall be the
prior 5 day average.
CERTAIN ARRANGEMENTS WITH DIRECTORS AND EXECUTIVE OFFICERS
Manfred F. Dyck has served as Chairman, Chief Executive Officer and President of
the Company since July of 1989. He served the Company approximately 5 days per
month, not to exceed 20% of his time. He was then compensated by a salary of
$100,000 per annum effective August 12, 1998 and a car allowance of $5,000 per
annum. He also participated in a management bonus program based upon Company
profitability.
On August 23, 1999 Mr. Dyck began serving the Company 80% of his time at a
salary of $156,000. The Company
7
agreed to pay Mr. Dyck a full time salary of $195,000 subject to being
reimbursed $9,750 on a quarterly basis from Biosearch Medical Products, Inc. an
affiliated company which became a wholly owned subsidiary of the Company in
February 2000. As of October 1, 2000 Mr. Dyck's anual salary was increased to
$215,000 per year. In August 2001 Mr. Dyck salary was adjusted to $225,000 per
year. (see "Compensation of Executive Officers")
INFORMATION CONCERNING CERTAIN SHAREHOLDERS
The shareholders (including any "group" as that term is used in Section 13(d)
(3) of the Securities Exchange Act of 1934) who, to the knowledge of the Board
of Directors of the Company, owned beneficially more than 5% of the outstanding
Common Stock as of September 1, 2001, and all directors and officers of the
Company as a group, and their respective stock holdings (according to
information furnished by them to the Company), are set forth in the following
table. Except as indicated in the footnotes to the table, all of such shares are
owned with sole voting and investment power.
SHARES OF COMMON
STOCK OWNED PERCENT OF CLASS
Name and Address BENEFICIALLY (1)
Manfred F. Dyck 1,572,037 (2)(3) 34.3%
255 Holland Road
Far Hills, NJ 07931
Dieter Heinemann 600,030 (4) 13.1%
Goldbergweg 6460599
Frankfurt AM
Federal Republic
of Germany
Ben Posdal 355,361 8.14%
PO Box 23632
Tampa, Fl 22623
All Directors and Officers 2,387,067(2)(3)(4)(5) 52.0%
As a group (13 persons)
(1) As of September 1, 2001, except as otherwise indicated below, each nominee
had sole voting and investment power with respect to all shares shown in the
table as beneficially owned by such nominee.
(2) includes an aggregate of 30,300 shares held by Mr. Dyck as custodian for
certain of his children/grandchildren and does not include 209,708 shares held
with sole voting and investment power by Mr. Dyck's children and relatives of
Mr. Dyck. Excludes 137,854 options held by Mr. Dyck
(3) Does not include 165,000 shares held by Ursula M. Dyck, Mr. Dyck's wife,
individually and as custodian. Does not include 26,000 options held by Mrs.
Dyck.
(4) Does not include 135,000 shares held by the wife and children of Mr.
Heinemann as to which he disclaims beneficial ownership. Also excludes 26,000
options held by Mr. Heinemann.
(5) Excludes 77,285 stock options held by Mr. Ehrhard, 37,285 stock options held
by Mr. Moravsik, 31,105 stock options held by Mr. Martin C. Dyck and 137,854
stock options held by Mr. Manfred F. Dyck. Excludes all options held by
Directors. (See "Stock Options")
OTHER INFORMATION CONCERNING DIRECTORS,
OFFICERS AND SHAREHOLDERS
8
There is no other information regarding Officers and Shareholders.
II. RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS (PROPOSAL II)
Subject to ratification by the stockholders, the Board of Directors, has
selected the firm of Rosenberg Rich Baker Berman & Company ("RRBB") as the
Company's independent public accountants for the current year. For the fiscal
year ending June 30, 2001 RRBB provided $35,085 in services to the Company of
which $5,735 was for services rendered outside the scope of their
responsibilities as independant public accountants (non-auditing services).
Representatives of RRBB are expected to be present at the Annual Meeting. They
will have the opportunity to make a statement if they desire to do so and will
also be available to respond to appropriate questions from stockholders.
III. OTHER MATTERS
The Board of Directors of the Company does not know of any other matters which
may be brought before the meeting. However, if any such other matters are
properly presented for action, it is the intention of the persons named in the
accompanying form of Proxy to vote the shares represented thereby in accordance
with their judgment on such matters.
IV. MISCELLANEOUS
If the accompanying form of Proxy is executed and returned, the shares
represented thereby will be voted in accordance with the terms of the Proxy,
unless the proxy is revoked by written notice addressed to and received by the
Secretary of the Corporation. If no directions are indicated in such Proxy, the
shares represented thereby will be voted in the election of directors in favor
of the nominees proposed by the Board of Directors, and in favor of ratification
of The Independent Certified Public Accountants. Any Proxy may be revoked at any
time before it is exercised. The casting of a ballot at the Meeting by a
shareholder who may theretofore have given a Proxy will not have the effect of
revoking the same unless the shareholder so notifies the Secretary of the
meeting in writing at any time prior to the voting of the shares represented by
the Proxy.
Votes that are withheld and broker non-votes will be treated as shares that are
present for purposes of determining a quorum. Withheld votes will be excluded in
determining whether a nominee for director or the ratification of independent
certified public accountants, has received a plurality of the votes cast.
All costs relating to the solicitation of Proxies will be borne by the Company.
Proxies may be solicited by mail and the Company may pay brokers and other
persons holding shares of stock in their names or those of their nominees for
their reasonable expenses in sending soliciting materials to their principals.
It is important that Proxies be returned promptly. Shareholders who do not
expect to attend the Meeting in person are urged to mark, sign and date the
accompanying form of Proxy and mail it in the enclosed return envelope, which
requires no postage if mailed in the United States, so that their vote can be
recorded.
V. EXCHANGE ACT COMPLIANCE
Section 16(a) of the Securities Exchange Act requires that certain of the
Company's officers, directors and persons who own more than ten percent of a
registered class of the Company's securities, file reports of ownership and
changes in ownership of the Company's securities with the Securities Exchange
Commission. Officers, directors and greater than ten percent shareholders are
required to provide the Company with copies of the forms they file.
9
Based solely upon its review of copies of such forms received by the Company,
and upon representations by the Company's officers and directors regarding
compliance with the filing requirements, the company believes that in Fiscal
2000/2001, all filing requirements applicable to its officers, directors and ten
percent shareholders were complied within a timely manner.
VI. SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 2002 Annual Meeting of
Shareholders of the Company must be received by the Company by May 14, 2002 in
order to be considered for inclusion in the Company's Proxy Statement relating
to such meeting.
10
HYDROMER, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS ON NOVEMBER 14, 2001
The undersigned hereby appoints Robert J. Moravsik and Robert Y. Lee and each of
them, to represent the undersigned at the Annual Meeting of Stockholders of
Hydromer, Inc. to be held at Hydromer's facility located at 35 Industrial
Parkway, Branchburg, New Jersey, on Tuesday, November 14, 2001 at 10:00 a.m.,
and at any adjournment thereof, on all matters coming before such meeting.
--------------------------------------------------------------------------------
Please mark
your votes as
indicated in
example
1. Election of Manfred F. Dyck; FOR all nominees (except as WITHHOLD AUTHORITY
Maxwell Borow, MD; provided to the contrary below) to vote for all nominees
Dieter Heinemann;Ursula M. Dyck;
Robert H. Bea; Dr. Klaus Meckeler ------ ------
Dr. Frederick Perl and Dr. Gaylord McKissick
INSTRUCTIONS: to withhold authority for any nominee, write
that nominee's name here:
________________________________________________________________
2.The ratification of the appointment
of Rosenberg, Rich, Baker,Berman & Company
as Company's Independent Accountants for
fiscal 2001. FOR AGAINST ABSTAIN
---- ---- ----
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting or any postponement or
adjournment thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL
BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS APPEARING ON THIS SIDE.
IF A CHOICE IS NOT INDICATED WITH RESPECT TO ITEMS 1 or 2, THIS PROXY
WILL BE VOTED "FOR" SUCH ITEM. THE PROXIES WILL USE THEIR DISCRETION
WITH RESPECT TO ANY OTHER MATTER PROPERLY BROUGHT BEFORE THE MEETING
OR POSTPONEMENT OR ADJOURNMENT THEREOF. THIS PROXY IS REVOCABLE AT ANY
TIME BEFORE IT IS EXERCISED.
Receipt herewith of the Company's Annual Report and notice of meeting and proxy
statement dated September 14, 2001 is hereby acknowledged.
PLEASE SIGN, DATE AND MAIL TODAY
Signature(s) of Stockholders(s)_____________________________ Date__________ 2001
Joint owners must EACH sign. Please sign EXACTLY as your name(s) appear(s) on
this card. When signing as attorney, executor, administrator, trustee, guardian,
partner or corporate officer please give FULL title.
- FOLD AND DETACH HERE -