SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
--------------------------------
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-12
[ ] Confidential, For Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
IntegraMed America, Inc.
---------------------------------------------------
(Name of Registrant as Specified in Its Charter)
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (Check the appropriate box):
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(1) Title of each class of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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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: April 13, 2006
April 13, 2006
Dear Stockholder:
It is my pleasure to invite you to attend the 2006 Annual Meeting of
Stockholders of IntegraMed America, Inc. The meeting will be held at 10:00 a.m.
(local time) on Tuesday, May 23, 2006, at the Company's corporate offices at Two
Manhattanville Road, 3rd Floor, Purchase, New York.
The following pages contain the formal Notice of Annual Meeting of Stockholders
and the Proxy Statement. Please review this material for information concerning
the business to be conducted at the meeting, which is the election of seven
directors for a term of one year. You will also have the opportunity to hear
what has happened in our business in the past year and to ask questions. You
will find detailed information about IntegraMed America, Inc. in the enclosed
2005 Annual Report to Stockholders.
We hope you can join us on May 23, 2006. Whether or not you can attend, please
read the enclosed Proxy Statement. When you have done so, please mark your votes
on the enclosed Proxy Card, sign and date the Proxy Card, and return it in the
enclosed envelope. Your vote is important to the Company, so please return your
Proxy promptly.
Sincerely,
/s/Jay Higham
-----------------------------------
Jay Higham
President & Chief Executive Officer
INTEGRAMED AMERICA, INC.
Two Manhattanville Road
Purchase, New York 10577
--------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held May 23, 2006
--------------------------
To the Stockholders:
Notice is hereby given that the Annual Meeting of the Stockholders of
IntegraMed America, Inc. (the "Company") will be held on Tuesday, May 23, 2006,
10:00 a.m. local time, at the Company's headquarters, Two Manhattanville Road,
3rd Floor, Purchase, New York 10577. The meeting is called for the following
purposes:
1. To elect seven directors for a term of one year; and
2. To transact such other business as may properly come before the
meeting or any adjournments thereof.
Only stockholders of record at the close of business on March 31, 2006
are entitled to notice of, and to vote at, the meeting.
All stockholders are cordially invited to attend the meeting. However,
to assure your representation at the meeting, you are urged to mark, sign, date
and return the enclosed Proxy Card as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. Any stockholder attending
the meeting may vote in person even if the stockholder has returned the Proxy
Card.
/s/ Claude E. White
-------------------------------------------
Claude E. White
Vice President, General Counsel & Secretary
April 13, 2006
16
INTEGRAMED AMERICA, INC.
Two Manhattanville Road
Purchase, New York 10577
914-253-8000
---------------------------
PROXY STATEMENT
---------------------------
For the Annual Meeting of Stockholders
To Be Held on Tuesday, May 23, 2006
Solicitation of Proxy
This Proxy Statement is furnished to stockholders of IntegraMed
America, Inc. (the "Company") in connection with the solicitation by the
Company's Board of Directors of proxies for use at the Annual Meeting of
Stockholders of the Company to be held in Purchase, New York, on Tuesday, May
23, 2006 at 10:00 a.m., and any adjournments of the meeting ("Annual Meeting").
Mailing Date
The Annual Report of the Company for 2005, including financial
statements, the NOTICE OF ANNUAL MEETING OF STOCKHOLDERS, this Proxy Statement,
and the Proxy Card are being mailed to stockholders on or about April 13, 2006.
Who can vote -- Record Date
The record date for determining stockholders entitled to notice of and
to vote at the Annual Meeting is March 31, 2006. Each of the 5,127,300 shares of
Common Stock, par value $.01 per share (the "Common Stock"), of the Company
issued and outstanding on the record date is entitled to one vote at the
meeting.
How to vote -- Proxy Instructions
You can vote your shares by mailing in your proxy card. Stockholders
who hold their shares in "street name" must vote their shares in the manner
prescribed by their brokers.
In voting on the Directors, you may specify whether your shares should
be voted for all, some, or none of the nominees for director.
If you do not specify on your proxy card how you want to vote your
shares, we will vote them "FOR" the election of all nominees for director as set
forth under "Election of Directors".
Revocation of Proxies
You may revoke your Proxy at any time before it is exercised in any of
three ways:
(1) by submitting written notice of revocation to the Company's
Secretary, which must be received prior to the Annual Meeting;
(2) by submitting a new Proxy by mail that is dated later in time
and properly signed; or
(3) by voting in person at the meeting.
1
Quorum
A quorum of stockholders is necessary to hold a valid meeting. A quorum
will exist if the holders of a majority of the votes entitled to be cast by the
stockholders at the Annual Meeting are present, in person or by proxy. Broker
"non-votes" and abstentions are counted as present at the Annual Meeting for
purposes of determining whether a quorum exists.
Required Vote
Nominees receiving a plurality of the voted shares present in person or
represented by proxy at the Annual Meeting will be elected directors.
"Plurality" means that the nominees who receive the largest number of votes cast
are elected as directors. For that reason, any shares not voted (whether
abstentions, broker "non-votes" or otherwise) will not affect the outcome of the
election of directors. The Board does not anticipate that any nominee will be
unable or decline to serve.
Voting Results
Preliminary voting results will be announced at the Annual Meeting.
Final voting results will be published in our quarterly report on Form 10-Q for
the second quarter of 2006.
Other Business
The Company does not intend to bring any business before the meeting
other than that set forth in the Notice of Annual Meeting and described in this
Proxy Statement. However, if any other business should properly come before the
meeting, the persons named in the enclosed proxy card intend to vote in
accordance with their best judgment on such business and any matters dealing
with the conduct of the meeting pursuant to the discretionary authority granted
by your proxy.
2
SECURITY OWNERSHIP
The following table sets forth, as of March 31, 2006, certain
information concerning the stock ownership of all persons known by the Company
to own beneficially 5% or more of the shares of Common Stock, and each director,
and each executive officer named under "Executive Compensation", and all
directors and executive officers of the Company as a group.
Shares of
Common Stock Percent of
Beneficially Common Stock
Beneficial Owners Owned (1) Outstanding
----------------- --------- -----------
Peter R. Kellogg................................ 700,130(2) 13.66%
120 Broadway
New York, NY 10271
Gruber & McBaine Capital Management, LLC........ 424,008(3) 8.27%
50 Osgood Place, Penthouse
San Francisco, CA 94133-4622
Officer and Director Stock Ownership
Gerardo Canet (4)............................... 40,096 *
Jay Higham...................................... 83,166(5) 1.62%
John W. Hlywak, Jr.............................. 58,500(5) 1.14%
Joseph J. Travia, Jr............................ 19,600(5) *
Donald S. Wood, PhD............................. 38,051(5) *
Sarason D. Liebler.............................. 0 *
Wayne R. Moon................................... 23,465(5) *
Lawrence J. Stuesser............................ 31,460(5) *
Elizabeth E. Tallett............................ 44,265(5) *
Yvonne S. Thornton, M.D......................... 838 *
ALL EXECUTIVE OFFICERS AND DIRECTORS
AS A GROUP (15 persons)..................... 348,406(5) 6.80%
--------------
* Represents less than 1% of outstanding shares of Common Stock.
(1) For the purposes of this Proxy Statement, beneficial ownership is defined
in accordance with the rules of the Securities and Exchange Commission
(the "Commission") and generally means the power to vote and/or to dispose
of the securities regardless of any economic interest therein.
(2) Includes 100 shares held by Cynthia Kellogg, wife of Peter R. Kellogg,
based on a Schedule 13G/A dated February 15, 2006 filed jointly by IAT
Reinsurance Company Ltd. ("IAT") and Mr. Kellogg. According to the
Schedule 13G/A, Mr. Kellogg has sole dispositive and voting power with
respect to the Company shares owned by IAT and its subsidiaries. Mr.
Kellogg disclaims beneficial ownership of the shares owned by IAT and its
subsidiaries, and his wife.
(3) Includes 345,996 shares of Common Stock held by accounts managed by Gruber
and McBaine Capital Management, LLC. (the "LLC"), for which the LLC has
shared voting and dispositive powers pursuant to various investment
management agreements, and 39,997 and 38,015 shares held by Jon D. Gruber
and J. Patterson McBaine, respectively, based on a Schedule 13G filed
February 3, 2006. Messrs. Jon D. Gruber, J. Patterson McBaine and Eric B.
Swergold are managers of the LLC. The 345,996 shares of Common Stock
includes 271,090 shares for which Lagunitas Partners, an investment
limited partnership of which the LLC is the general partner, has shared
voting and dispositive powers.
(4) Although Mr. Canet resigned as Chief Executive Officer of the Company
effective December 31, 2005, for purposes of this Proxy Statement, Mr.
Canet is being reported as an Executive Officer.
(5) Includes exercisable options to purchase Common Stock, including options
exercisable within 60 days of March 31, 2006, as follows: Jay Higham --
1,829; John Hlywak -- 7,250; Joseph Travia--- 5,159; Donald S. Wood --
1,829; Wayne R. Moon -- 6,500; Lawrence Stuesser -- 18,850; and Elizabeth
Tallett -- 24,700. As to "All Executive Officers and Directors as a
Group," the 344,906 shares includes an aggregate of 5,525 shares
beneficially owned, including exercisable options, by executive officers
not named above. The address for each of these individuals is c/o
IntegraMed America, Inc., Two Manhattanville Road, Purchase, New York
10577.
3
ELECTION OF DIRECTORS FOR A TERM OF ONE YEAR
Each of the nominees is currently a director of the Company. The Board
of Directors recommends that the persons named below be elected as directors of
the Company and it is intended that your proxy will be voted for the election as
directors of the seven persons named below, unless your proxy contains contrary
instructions. The Company has no reason to believe that any of the nominees will
not be a candidate or will be unable to serve. However, in the event that any
nominee should become unable or unwilling to serve as a director, your proxy
will be voted for the election of such person or persons as shall be designated
by the Board of Directors.
The following sets forth the names and ages of the seven nominees for
election to the Board of Directors, their respective principal occupations or
employments during the past five years and the period during which each has
served as a director of the Company.
GERARDO CANET (60) served as Chief Executive Officer and a director of
the Company from February 14, 1994 to December 31, 2005. Mr. Canet resigned as
Chief Executive Officer effective December 31, 2005, but continues to serve as
Chairman of the Board and a consultant to the Company. For approximately five
years prior to joining the Company, Mr. Canet held various executive management
positions with Curative Health Services, Inc., the last of which was as
Executive Vice President and President of its Wound Care Business Unit. Mr.
Canet has been a director of Dendreon Corporation since December 1996. Mr. Canet
earned a B.A. in Economics from Tufts University and an M.B.A. from Suffolk
University.
JAY HIGHAM (47) became President and Chief Executive Officer, effective
January 1, 2006 and was President and Chief Operating Officer of the Company
since June 2004. In October 1994 Mr. Higham joined the Company as Vice President
of Marketing and Development and in January 1999, was promoted to Senior Vice
President of Marketing and Development. For four years prior to joining the
Company, Mr. Higham held a variety of executive positions, the most current of
which was as Vice President of Health Systems Development for South Shore
Hospital and South Shore Health and Education Corporation where he developed and
implemented a strategy for integration with physician group practices and
managed care payers. Mr. Higham earned a B.S. in Psychology from the University
of Rochester and a M.H.S.A. from George Washington University.
SARASON D. LIEBLER (69) became a director of the Company in August 1994.
Mr. Liebler is President of SDL Consultants, a privately-owned consulting firm
engaged in rendering general business advice. During the past 20 years, Mr.
Liebler was a director and/or officer of a number of companies in the fields of
home health care, clinical diagnostics, high density optical storage and
sporting goods. Mr. Liebler is a graduate of the United States Naval Academy
with a B.S. in Engineering.
WAYNE R. MOON (66) became a director of the Company in May 2001. Mr.
Moon joined Kaiser Foundation Health Plan, Inc. in 1970 and was subsequently
elected President, Chief Operating Officer and Director. In September 1993, Mr.
Moon was appointed President and Chief Executive Officer of Blue Shield of
California and a member of its Board of Directors and, later, Chairman. Mr. Moon
retired from Blue Shield in January 2000. He currently serves as Chairman of the
Board of RelayHealth, Inc. He serves on various corporate, professional and
civic boards, including Varian, Inc. and the California State Automobile
Association. Mr. Moon earned a B.B.A. and a Masters in Hospital Administration
from the University of Michigan.
LAWRENCE J. STUESSER (64) became a director of the Company in April
1994. Since June 1999, Mr. Stuesser has been a private investor. From June 1996
to May, 1999, Mr. Stuesser was the President and Chief Executive Officer and a
director of Computer People Inc., the U.S. subsidiary of London-based Delphi
Group plc., of which he was also a director. Mr. Stuesser was a director of
Curative Health Services, Inc. from July 1993 to May 2000 and has been a
director of American Retirement Corporation since May 1997. Early in his career,
Mr. Stuesser qualified as a certified public accountant and served as an audit
manager with Alexander Grant & Company, an accounting firm. Mr. Stuesser holds a
B.B.A. in accounting from St. Mary's University.
ELIZABETH E. TALLETT (57) became a director of the Company in June 1998.
Since July 2002, Ms. Tallett has been a Principal of Hunter Partners, LLC, which
provides management services to developing life sciences companies. From
November 2000 until January 2003, Ms. Tallett was Chief Executive Officer of
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Marshall Pharmaceuticals, Inc., a specialty pharmaceutical company. Ms. Tallett
held the position of President and Chief Executive Officer of Dioscor, Inc., a
biopharmaceutical company, from 1996 until July 2003. Ms. Tallett was President
and Chief Executive Officer of Ellard Pharmaceuticals, Inc. and Galenor, Inc.,
both biopharmaceutical companies, from 1997 to 2000 and 1999 to 2000,
respectively. Ms. Tallett is a director of The Principal Financial Group, Inc.,
Varian Semiconductor Associates, Inc., Varian, Inc., Coventry Health Care, Inc.
and Immunicon, Inc. She is a founding board member of the Biotechnology Council
of New Jersey. Ms. Tallett graduated from Nottingham University with a degree in
mathematics and economics.
YVONNE S. THORNTON, M.D., M.P.H. (58) became a director of the Company
in January 2006. Dr. Thornton is a double board-certified specialist in
obstetrics, gynecology and maternal-fetal medicine. Since April 2003, Dr.
Thornton has been a Professor of Clinical Obstetrics and Gynecology at Cornell
(Weill) Medical College and from 2002-2005 she was Vice-Chair of the Department
of OB/GYN and Director of Maternal-Fetal Medicine at Jamaica Hospital Medical
Center in New York City. From 2000-2002, Dr. Thornton was a member of the
Department of Obstetrics and Gynecology, Division of Maternal-Fetal Medicine at
St. Luke's-Roosevelt Hospital in New York City. Dr. Thornton is a Diplomate of
the American Board of Obstetrics and Gynecology, a Fellow of the American
College of Surgeons and an Oral Examiner for the American Board of Obstetrics
and Gynecology. She is the author of the Pulitzer prize-nominated book entitled,
"The Ditchdigger's Daughters." After graduating with honors from Monmouth
College in New Jersey, she received her M.D. degree with honors from Columbia
University College of Physicians and Surgeons. Dr. Thornton also received her
Executive Masters (M.P.H.) degree in Health Policy and Management from Columbia
University.
The Board of Directors recommends a vote "FOR" each nominee listed
above. Your proxy will be voted in accordance with the choice specified thereon,
or, if no choice is properly indicated, in favor of the nominees listed above.
---------------------
The Board of Directors has determined that Messrs. Moon and Stuesser,
Ms. Tallett and Dr. Thornton are independent directors in accordance with Rule
4200(a)(15) of the National Association Securities Dealers ("NASD") listing
standards because none of them is believed to have any relationships that, in
the opinion of the Board of Directors, would interfere with the exercise of
independent judgment in carrying out their responsibilities as a director. Mr.
Higham is precluded from being deemed independent under the NASD listing
standards because he currently serves as an executive officer of the Company.
Mr. Canet is precluded from being deemed independent under the NASD listing
standards because he has served as an executive officer of the Company during
the past three years and Mr. Liebler is precluded from being deemed independent
under the NASD listing standards because he received compensation other than
director fees from the Company in excess of $60,000 during the previous three
(3) years.
Directors are elected by the Company's stockholders at each annual
meeting or, in the case of a vacancy, are appointed by the directors then in
office, to serve until the next annual meeting of stockholders or until their
successors are elected and qualified. Officers are appointed by and serve at the
discretion of the Board of Directors.
During 2005, the Board of Directors held four meetings, and took action
by written consent three times. Each director attended at least 75% of the
aggregate of all meetings of (i) the Board of Directors and (ii) the committees
thereof on which each director served during 2005. In 2005, the independent
directors of the Board met four times in executive session.
Stockholders may communicate directly with the directors. All
communications should be sent in care of the Secretary of the Company at the
Company's address and should prominently indicate on the outside of the envelope
that it is intended for the Board of Directors, for non-employee directors or a
particular committee of the directors. If no director is specified, the
communication will be forwarded to the entire Board.
The Company does not have a policy requiring the directors to attend
stockholders meetings; however, all of our directors attended the 2005 annual
meeting. It is expected that all of our directors will attend the 2006 Annual
Meeting.
5
COMMITTEES OF THE BOARD
The Board of Directors maintains three standing Committees: Audit
Committee, Compensation Committee, and Nominating and Governance Committee whose
members are set forth below:
AUDIT COMPENSATION NOMINATING AND GOVERNANCE
----- ------------ -------------------------
Wayne R. Moon Wayne R. Moon Wayne R. Moon*
Lawrence J. Stuesser* Lawrence J. Stuesser Lawrence J. Stuesser
Elizabeth E. Tallett Elizabeth E. Tallett* Elizabeth E. Tallett
Yvonne S. Thornton, M.D. Yvonne S. Thornton, M.D.
*Committee Chairperson
AUDIT COMMITTEE
The Audit Committee is charged by the Board of Directors to (i) study,
review and evaluate the Company's accounting, auditing and financial reporting
practices, including the internal controls and audit functions, (ii) assess the
Company's compliance with legal and regulatory requirements, and (iii) select
the independent auditors and review their qualifications, independence and
performance, while being the focal point for communications between the Board of
Directors, management and the independent auditors. More specifically, the Audit
Committee pre-approves all audit and non-audit services to be performed by the
independent auditors, reviews the scope and results of the audit of the
Company's financial statements, reviews financial statements and periodic
filings with the Commission, and discusses the same with management.
Each Audit Committee member meets the independence standards of The
Nasdaq Stock Market, Inc. The Board of Directors has determined that in addition
to being independent, Mr. Stuesser is an "audit committee financial expert" as
such term is defined in Item 401 of Regulation S-K of the Exchange Act. The
Board of Directors has adopted a written charter for the Audit Committee, a copy
of which, as amended and restated as of December 6, 2005, is appended to this
Proxy Statement as Appendix A. The Audit Committee held four regular and four
telephonic meetings in 2005.
COMPENSATION COMMITTEE
The Compensation Committee, under a delegation of authority from the
Board of Directors, reviews and makes decisions with respect to salaries, wages,
bonuses, equity awards and other benefits and incentives for executive officers
of the Company. The Compensation Committee also administers all compensation
programs for executive management of the Company. The Compensation Committee
held four meetings in 2005.
The Compensation Committee has a charter, a copy of which is available
to stockholders at the Company's website http://www.integramed.com under the
Investors' Relation Section thereof.
Compensation Committee Interlocks and Insider Participation
For 2005 the members of the Compensation Committee were Ms. Tallett
(Chairperson) and Messrs. Stuesser and Moon. None of these individuals has ever
been an officer or employee of the Company or any of its subsidiaries. For 2005,
no executive officer of the Company served on the Compensation Committee or
Board of Directors of any other entity, which had any executive officer who also
served on the Compensation Committee or Board of Directors of the Company.
NOMINATING AND GOVERNANCE COMMITTEE
The Board of Directors maintains a Nominating and Governance Committee
consisting of independent directors as defined by NASDAQ rules. The primary
purpose of the Committee is to provide oversight on the broad range of issues
surrounding the composition and operation of the Board of Directors, including
identifying individuals qualified to become Board members, recommending to the
Board director nominees for the next annual meeting of stockholders, and
6
recommending to the Board a set of corporate governance principles applicable to
the Company. The Committee also provides assistance to the Board in the areas of
Committee selection, evaluation of the overall effectiveness of the Board and
management, and review and consideration of developments in corporate governance
practices. The Committee's goal is to assure that the composition, practices,
and operation of the Board contribute to value creation and effective
representation of the Company stockholders.
The Nominating and Governance Committee will consider candidates for
board membership whose qualifications, including business experience and skills,
lend themselves to advancing the Company's best interests. There are no minimum
qualifications that the Committee looks for. Stockholders may recommend
candidates for consideration by the Nominating and Governance Committee by
writing to the Chairperson of the Nominating Committee, c/o IntegraMed America,
Inc. Two Manhattanville Road, Purchase, New York 10577. Such recommendations for
the 2007 annual meeting of stockholders must be received by the Company between
January 23, 2007 and February 23, 2007. The Nominating and Governance
Committee's process for identifying and evaluating nominees for director,
including nominees recommended by stockholders, includes background and
reference checks, together with personal interviews.
The Nominating and Governance Committee has a charter, a copy of which
is available to stockholders at the Company's website http://www.integramed.com
under the Investors' Relation Section thereof.
DIRECTOR COMPENSATION
In 2005 non-employee directors of the Company were paid an annual
retainer of $10,000, a fee of $1,000 for each regularly scheduled meeting of the
Board attended, $2,500 per year for membership on each committee of the Board
(and $1,500 for serving as Chairperson a Committee or $3,000 for serving as
Chairperson of the Audit Committee), and were reimbursed for expenses incurred
in attending meetings. Additionally, non-employee directors were granted, as
part compensation for services rendered, 3,350 shares of Common Stock, with a
market value of $36,515 based on the closing price per share of the Company's
Common Stock on the date of the grant. Directors who are also executive officers
are not compensated for their services as directors. For 2006, each non-employee
director currently receives (1) an annual retainer fee of $15,000; (2) $2,500
for each Committee on which he or she serves; (3) $1,500 if he or she serves as
Chairperson of a Committee and $3,000 if he or she serves as Chairperson of the
Audit Committee; (4) $1,500 for each regular Board meeting attended ($2,000 for
any special meeting or committee meeting not coinciding with a regularly
scheduled Board meeting (and are reimbursed for reasonable travel expenses
incurred in attending meetings); and (4) a stock grant, upon election at the
Annual Meeting equal to the number of shares resulting from dividing $25,000 by
the closing market price on the day before the Annual Meeting of Shareholders,
with vesting upon grant.
The following chart sets forth fees paid for 2005 for non-employee
directors serving on the Board of Directors
----------------------------- ------------------- ------------------------- ---------------------------
BOARD COMMITTEE
DIRECTOR RETAINER ATTENDANCE FEE MEMBERSHIPS
----------------------------- ------------------- ------------------------- ---------------------------
Sarason D. Liebler $10,000 $4,000 $0
----------------------------- ------------------- ------------------------- ---------------------------
Wayne R. Moon $10,000 $4,000 $9,000 (1)
----------------------------- ------------------- ------------------------- ---------------------------
Lawrence J. Stuesser $10,000 $4,000 $10,500 (2)
----------------------------- ------------------- ------------------------- ---------------------------
Elizabeth E. Tallett $10,000 $4,000 $9,000 (1)
----------------------------- ------------------- ------------------------- ---------------------------
(1) Each of Mr. Moon and Ms. Tallett is paid an additional $1,500 for their
respective roles as Chairperson of the Compensation Committee and the
Nominating and Governance Committee, respectively.
(2) Mr. Stuesser is paid an additional $3,000 as Chairman of the Audit
Committee.
SDL Consultants, a company owned by Sarason D. Liebler, who became a
director of the Company in August 1994, rendered consulting services to the
Company for aggregate fees of approximately $83,000, $63,000 and $83,000 during
2005, 2004 and 2003, respectively.
7
BUSINESS EXPERIENCE OF EXECUTIVE OFFICERS
The following sets forth the business experience of executive officers
who are not also directors of the Company:
JOHN W. HLYWAK, JR. (58) joined the Company in July 1999 as its Senior
Vice President and Chief Financial Officer and was named Executive Vice
President and Chief Financial Officer in March 2006. From 1997 to 1999 he was
the Senior Vice President and Chief Financial Officer of MedSource, Inc., a
Tennessee-based health care billing and receivables management company. Mr.
Hlywak is a C.P.A. and has a B.S. degree in Accounting from Widener University.
PAMELA SCHUMANN (40) serves as Vice President, Consumer Services. She
joined the Company in in 2001 to help launch the Company's consumer services
initiative. Before joining the Company, Ms. Schumann was Vice President of a
physician-focused managed care consulting firm where she spent 8 years. Ms.
Schumann has extensive experience in healthcare marketing, GPO operations and
physician practice development. Ms. Schumann received her BA in Marketing from
University of Maryland's Robert H. Smith School of Business.
SCOTT SOIFER (43) joined the Company in January 2005 as Vice President,
Marketing and Development. Prior to joining the company, Mr. Soifer was an
Associate Partner at Accenture (formerly Andersen Consulting) for 13 years,
specializing in Healthcare strategy, focused primarily on the health insurance
sector. He also did independent consulting work, focused on streamlining
financial transactions between payers, providers and patients, and on new
product development in the disease management area. Mr. Soifer has a Bachelor's
degree in Computer Science from the University of California at Santa Barbara
and an MBA from the Kellogg School of Management at Northwestern University.
DAVID TANNER (46) serves as Senior Vice President Operations, Western
Region. He joined the Company in November 2003 as Vice President and was
promoted to his current position in October 2004. From February 2000 to May 2003
Mr. Tanner served as the Chief Executive Officer of Calais Health, a physician
practice management and medical managed care management company with operations
in Louisiana, Oklahoma and Mississippi. Mr. Tanner served as Regional Vice
President at Healthsouth Corporation from October 1992 to January 2000. Mr.
Tanner received his M.B.A from the University of Phoenix and a B.S. in Health
Services Administration from Weber State University.
JOSEPH J. TRAVIA, JR. (53) serves as Senior Vice President, Operations,
Eastern Region. He joined the company in 2000 as its Vice President and
Executive Director of Reproductive Science Center in New England. Prior to
joining the Company, from 1997 - 1999 Mr. Travia served as President and Chief
Executive Officer of Capstan, LLC. Early in his career, Mr. Travia qualified as
a certified public accountant and served as a tax consultant and senior auditor
with Ernst & Young, an accounting firm. Mr. Travia earned a B.S. in Management
from Boston College and an M.B.A. from Babson College.
CLAUDE E. WHITE (57) joined the Company in March 1995 as General Counsel
and Assistant Secretary. In January 1998, Mr. White became Corporate Secretary,
in addition to General Counsel, and in May, 2002 became a Vice President. Mr.
White has served as General Counsel of several major companies over a period of
10 years prior to joining the Company, including Burns International Security
Services, Inc., Staff Builders, Inc. and Quality Care, Inc. Mr. White received
his B.A. degree in Political Science from Rutgers College and J.D. degree from
Rutgers School of Law.
DONALD S. WOOD, PHD. (61) serves as Senior Vice President, Operations
Administration. He joined the Company in April 1991 as its Vice President of
Genetics. Dr. Wood became Vice President of Science and Technology in 1993, was
promoted President and Chief Operating Officer of the Reproductive Science
Center Division in 1997 and served as Senior Vice President and Chief Operating
Officer from January 1999 to June 2004. Dr. Wood received a PhD. in Physiology
from Washington State University and completed a post-doctoral fellowship in
neurology at the Columbia/Presbyterian Medical Center in New York, where he
subsequently was appointed an Assistant Professor of Neurology.
8
EXECUTIVE COMPENSATION
The following table sets forth a summary of the compensation paid or
accrued by the Company during the years ended December 31, 2005, 2004 and 2003
for the Company's Chief Executive Officer and for the next four most highly
compensated executive officers (the "Named Executive Officers").
===============================================================================================================
Long Term Compensation
----------------------
Securities
Restricted Underlying
Annual Compensation Stock Options
Name and Principal Position Year Salary($) Bonus($) Award(s)($) Granted (#)
---------------------------------------------------------------------------------------------------------------
Gerardo Canet (1) 2005 328,835(2) 153,001 43,600 --
(former Chief Executive Officer) 2004 282,308 102,600 25,520 --
2003 275,000 24,750 52,200 --
---------------------------------- -------------- ------------ ------------- ---------------- -----------------
Jay Higham 2005 235,730 99,876 43,600 --
President and Chief 2004 203,808 52,110 26,300 --
Executive Officer 2003 183,000 13,660 52,200 --
---------------------------------- -------------- ------------ ------------- ---------------- -----------------
John W. Hlywak, Jr. 2005 226,730 76,841 27,250 --
Executive Vice President 2004 212,577 51,600 12,760 --
and Chief Financial Officer 2003 206,000 16,480 26,100 --
---------------------------------- -------------- ------------ ------------- ---------------- -----------------
Joseph J. Travia, Jr.(3) 2005 189,730 62,800 18,175 --
Sr. Vice President, Eastern 2004 -- -- -- --
Operations 2003 -- -- -- --
---------------------------------- -------------- ------------ ------------- ---------------- -----------------
Donald S. Wood, PhD 2005 212,730 80,560 21,800 --
Sr. Vice President, 2004 200,846 48,720 12,760 --
Operations Administration 2003 195,000 15,600 26,100 --
================================== ============== ============ ============= ================ =================
(1) Although Mr. Canet resigned as Chief Executive Officer of the Company
effective December 31, 2005, for purposes of this Proxy Statement, Mr.
Canet is being reported as an Executive Officer.
(2) Includes "Other Compensation" totaling $17,297.
(3) Mr. Travia became Sr. Vice President of Operations, Eastern Region,
effective July 1, 2005.
The Company did not grant any stock options to the Named Executive
Officers for the year ended December 31, 2005.
9
The following table sets forth certain information concerning the Named
Executive Officers who held unexercised options at December 31, 2005:
===============================================================================
AGGREGATED OPTION EXERCISES IN 2005 AND
2005 YEAR-END OPTION VALUES
Number of
Shares Securities Underlying Value of Unexercised
Acquired Unexercised In-the-Money
On Options at Options at
Exercise Value December 31, 2005 December 31, 2005 (1)
----------------------------- --------------------------
Name (#) Realized Exercisable Unexercisable Exercisable Unexercisable
----------------------------- ----------- ----------- -------------------------------- ------------------------------
Gerardo Canet 113,065 $819,843 63,658 1,057 $662,473 $9,132
----------------------------- ----------- ----------- --------------- --------------- -------------- --------------
Jay Higham 7,921 $68,120 1,219 610 $10,532 $5,270
----------------------------- ----------- ----------- --------------- --------------- -------------- --------------
John W. Hlywak, Jr. 4,554 $39,390 6,640 610 $57,370 $5,270
----------------------------- ----------- ----------- --------------- --------------- -------------- --------------
Joseph J. Travia, Jr. 13,691 $137,301 4,834 325 $41,766 $2,808
----------------------------- ----------- ----------- --------------- --------------- -------------- --------------
Donald S. Wood, PhD. 16,046 $149,614 1,219 610 $10,532 $5,270
============================= =========== =========== =============== =============== ============== ==============
(1) Based upon the closing sales price of the Common Stock of $13.24 per
shares on The Nasdaq National Market(R) on December 30, 2005.
The following table sets forth information about the Company's Common
Stock authorized for issuance under the Company's Equity Compensation Plans as
of December 31, 2005:
===============================================================================
EQUITY COMPENSATION PLAN INFORMATION
(a) (b) (c)
Number of securities
remaining available for
Number of securities to Weighted-average future issuance under
be issued upon exercise exercise price of equity compensation plans
of outstanding options, outstanding options, (excluding securities
Plan Category warrants and rights warrants and rights reflected in column (a)
----------------------------- ------------------------- ------------------------- ---------------------------
Equity Compensation plans
approved by security 250,340 $3.46 172,420
holders (1)
----------------------------- ------------------------- ------------------------- ---------------------------
Equity compensation plans
not approved by security 0 0 0
holders
----------------------------- ------------------------- ------------------------- ---------------------------
Total 250,340 $3.46 172,420
----------------------------- ------------------------- ------------------------- ---------------------------
(1) The Company has two equity compensation plans approved by security
holders. One is the 1992 Incentive and Non-Incentive Stock Option Plan
(the "1992 Plan") and the other is the 2000 Long-Term Compensation
Plan. The 1992 Incentive and Non-Incentive Stock Option Plan expired in
April 2002 and accordingly, no further grants may be made. There are
option agreements under the 1992 Plan currently outstanding, all of
which expire 10 years from date of their respective grants.
10
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND
CHANGE-IN-CONTROL ARRANGEMENTS
On October 10, 2005, the Company entered into an employment agreement
with Jay Higham to serve as its President and Chief Executive Officer, effective
January 1, 2006. Pursuant to the employment agreement, Mr. Higham was appointed
director of the Company on January 24, 2006. The employment agreement provides
for Mr. Higham to receive an annual salary of $275,000, subject to increases.
Under the employment agreement, Mr. Higham was granted $400,000 worth of shares,
with the number of shares being determined based on the closing price of the
Company's stock the first trading day of January 2006, of Company stock which
vest over a 10-year period. Pursuant to the agreement, the Company may terminate
Mr. Higham's employment without cause on thirty days' notice, in which event Mr.
Higham will receive, as severance pay, twelve months' base salary payable, plus
Mr. Higham's annual bonus, without regard to the condition precedents
established under the bonus plan, in a lump sum.
The employment agreement further provides that in the event that within
one year after a "Change of Control" (as defined therein) of the Company, Mr.
Higham's employment is terminated by Mr. Higham for "Good Reason" (as defined
therein) or by the Company without cause, Mr. Higham will be paid a lump sum
amount equal to his base salary for a 24-month period following termination,
plus twice the full amount of Mr. Higham's annual bonus based on his then
current salary, without regard to the condition precedents established for the
bonus payment.
Under the employment agreement, Mr. Higham has agreed not to compete
with the Company while employed by the Company and for a period of two years
thereafter.
--------------
The Company is also party to Executive Retention Agreements with its
executive officers, including those set forth in the foregoing compensation
table.
The Executive Retention Agreements (the "Agreements") provide for
certain severance payments and benefits to the named executives in the event of
a termination of their employment, either by the Company without cause, or by
the executive for "Good Reason" (as defined therein), at any time within
eighteen (18) months following a "Change in Control" (as defined therein) of the
Company (any such termination, a "Qualifying Termination"). More specifically,
the Agreements provide the named executives with one additional year of salary,
bonus (if applicable), and benefits (or equivalent), more than he or she would
previously have been entitled to receive upon a termination without cause.
Accordingly, pursuant to the Agreements, in the event of a Qualifying
Termination, the named executives will be paid one year's severance. Pursuant to
the terms of the Agreements, all incentive options granted to the respective
executive would become fully vested upon a Qualifying Termination, subject to
certain terms and conditions. Also, pursuant to the Agreements, the Company
would be required to pay each respective executive for all reasonable fees and
expenses incurred by the respective executive in litigating his or her rights,
thereunder, to the extent the executive is successful in any such litigation.
In the event an executive officer, other than Mr. Higham who would be
paid in accordance with the terms of his employment agreement, is terminated
without cause under circumstances outside a "Change in Control," each person
would be paid ninety (90) days salary continuation.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), requires the Company's executive officers, directors and
persons who beneficially own more than 10% of a registered class of the
Company's equity securities to file with the Commission initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of the Company. Such executive officers, directors, and greater than
10% beneficial owners are required by Commission regulation to furnish the
Company with copies of all Section 16(a) forms filed by such reporting persons.
To the Company's knowledge, based solely on the Company's review of
copies of such reports furnished to the Company and written representations from
certain reporting persons that no other reports were required, all of the
11
Company's executive officers and directors, and greater than 10% beneficial
owners complied with applicable Section 16(a) filing requirements during the
year ended December 31, 2005.
COMMITTEE REPORT ON EXECUTIVE COMPENSATION (1)
The goal of the Company's executive compensation policy is to ensure
that an appropriate relationship exists between executive compensation and the
creation of stockholder value, while at the same time attracting, motivating and
retaining senior management. The Compensation Committee's executive compensation
philosophy (which applies generally to all Company management, including the
President and Chief Executive Officer, Jay Higham) considers a number of
factors, which may include:
o rewarding eligible employees who have achieved specific business and
financial success during the fiscal year;
o giving eligible employees the incentive to strive for higher
productivity, efficiency and quality of service; and
o encouraging the "best" people to join and stay with the Company.
Compensation structures for senior management generally include a
combination of salary, bonuses and restricted stock grants. Specific executive
officer base salary is determined based on a range of measures and by comparison
to the compensation of executive officers of comparable companies. For the
fiscal year ended December 31, 2005, the bonuses of senior management were
derived in accordance with a predetermined percentage of base salary. The actual
bonuses were based on two components. The first component was based on the
Company's performance during the fiscal year ended December 31, 2005 versus the
2005 budget. The second component was based on the achievement of specific
individual milestones. The Compensation Committee also endorses the position
that equity ownership by senior management is beneficial in aligning their
interest with those of stockholders, especially in the enhancement of
stockholder value. The Compensation Committee considers the Company's
performance under these measures and uses its subjective judgment and discretion
in approving individual compensation, including restrictive stock grants. Mr.
Higham's base salary was established pursuant to an employment agreement,
although his bonus is determined in the same fashion as other executive
officers.
Elizabeth E. Tallett (Chairperson)
Wayne R. Moon
Lawrence J. Stuesser
Yvonne S. Thornton, M.D.
AUDIT COMMITTEE REPORT (2)
The Audit Committee has oversight for the Company's financial reporting
on behalf of the Board of Directors. The Audit Committee, composed of three
independent (as defined by Section (a)(15) of Nasdaq Rule 4200) directors, held
four regular and four telephonic meetings in 2005, and operates under an amended
and restated charter approved by the Board of Directors in December 2005. The
amended and restated charter is attached as Appendix A to this Proxy Statement.
The Audit Committee also has at least one member, Mr. Stuesser, who is an "audit
committee financial expert" as such term is defined in Item 401 of Regulation
S-K of the Exchange Act.
------------------------------
(1) The material in this report is not soliciting material, is not
deemed filed with the Commission and is not incorporated by reference in any
filing of the Company under the Securities Act of 1933 or the Exchange Act,
except to the extent the Company specifically incorporates the report by
reference in any such document, whether made before or after the date of this
Proxy Statement and irrespective of any general incorporation language in such
filing.
(2) The material in this report is not soliciting material, is not
deemed filed with the Commission and is not incorporated by reference in any
filing of the Company under the Securities Act of 1933 or the Exchange Act,
except to the extent the Company specifically incorporates the report by
reference in any such document, whether made before or after the date of this
Proxy Statement and irrespective of any general incorporation language in such
filing.
12
Management has the primary responsibility for the financial statements
and the reporting process, including the Company's system of internal controls
and the Company's compliance with legal and regulatory requirements. In
fulfilling its oversight responsibilities, the Audit Committee reviewed and
discussed with management the audited financial statements to be included in the
Company's Annual Report on Form 10-K.
The Audit Committee has discussed with the Company's independent
auditors, Amper, Politziner & Mattia, P.C. the matters required to be discussed
by Statement on Auditing Standards No. 61, Communications With Audit Committees,
as amended by the Auditing Standards Board of the American Institute of
Certified Public Accountants.
The Audit Committee has received and reviewed, including matters in the
written disclosures and the letter from Amper, Politziner & Mattia, P.C.
required by Independent Standards Board No. 1, Independence Discussions with
Audit Committees, as amended by the Independence Standards Board, and has
discussed with Amper, Politziner & Mattia, P.C. their independence.
The Audit Committee has also considered whether any services provided
by Amper, Politziner & Mattia, P.C. not related to the audit of the financial
statements referred to above and the reviews of the interim financial statements
included in the Company's Form 10-Qs for the quarters ended March 31, 2005, June
30, 2005 and September 30, 2005 were compatible with maintaining the
independence of Amper, Politziner & Mattia, P.C..
Based on the reviews and discussions referred to above, the Audit
Committee, in accordance with its charter, recommended to the Company's
management that the audited financial statements referred to above be included
in the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2005. The Committee has appointed Amper, Politziner & Mattia, P.C. for the
Company's 2006 fiscal year audit.
Lawrence J. Stuesser (Chairperson)
Wayne R. Moon
Elizabeth E. Tallett
INDEPENDENT PUBLIC ACCOUNTANTS
On April 14, 2005, the Company dismissed PricewaterhouseCoopers LLP
("PwC") as its independent registered public accounting firm. The Audit
Committee made the decision to dismiss PwC.
The reports of PwC on the financial statements of the Company for the
fiscal years ended December 31, 2004 and 2003 contained no adverse opinion or
disclaimer of opinion and were not qualified or modified as to uncertainty,
audit scope or accounting principle.
During the fiscal years ended December 31, 2004 and 2003, and through
April 14, 2005, there were no disagreements with PwC on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements, if not resolved to the satisfaction of PwC,
would have caused PwC to make reference to its report on the financial
statements for such years. During the fiscal years ended December 31, 2004 and
2003, and through April 14, 2005, there were no "reportable events" (as defined
in Regulation S-K, Item 304(a)(1)(v)).
The Company furnished to PwC the statements made in Item 4.01 to its Form
8-K filed with the Securities and Exchange Commission ("SEC") and attached as
Exhibit 16.1 to said Form 8-K is PwC's letter to the SEC dated April 20, 2005,
regarding these statements.
On April 14, 2005, the Company engaged Amper, Politziner & Mattia, P.C.
("Amper") as its independent registered public accounting firm. The Audit
Committee of the Company's Board of Directors made the decision to engage Amper.
During the fiscal years ended December 31, 2004 and 2003, and through
13
April 14, 2005, the Company had not consulted with Amper in respect of the
Company's consolidated financial statements for the years ended December 31,
2004 and December 31, 2003 regarding any of the matters or events set forth in
Item 304(a)(2)(i) and (ii) of Regulation S-K.
The Audit Committee engaged Amper to audit the Company's financial
statements for the fiscal year ended December 31, 2005 and for the fiscal year
ended December 31, 2004, the Company's financial statements were audited by PwC.
For the Company's fiscal year ending December 31, 2006 the Audit Committee has
retained the firm Amper to audit the Company's financial statements. A
representative from Amper is expected to be present at the 2006 Annual Meeting
with the opportunity to make a statement, if desired. The Amper representative
is also expected to be available to respond to appropriate questions.
Pre-Approval Policy
In accordance with the requirements of the Sarbanes-Oxley Act of 2002
(the "Act") and the Audit Committee Charter, as amended in 2005, all audit and
audit-related work and all non-audit work performed by the independent
accountants, must be submitted to the Audit Committee for specific approval in
advance by the Audit Committee, including the proposed fees for such work. The
Audit Committee has not delegated any of its responsibilities to management.
All of the services described below for 2005 and 2004 were pre-approved
by the Audit Committee and/or the Committee Chairman before such services were
rendered by Amper in 2005 and PwC in 2004.
Audit Fees
Audit fees billed or expected to be billed to Company by Amper for the
audit of the consolidated financial statements included in the Company's Annual
Report on Form 10-K, reviews of the consolidated financial statements included
in the Company's Quarterly Reports on Form 10-Q and consultation on accounting
topics for the year ended December 31, 2005 totaled $158,000. Similar fees by
the Company's prior auditors, PwC for the year ended December 31, 2004 totaled
$165,000.
Audit-Related Fees
The aggregate fees billed by Amper for audit related services for the
year ended December 31, 2005 were $13,750 and primarily related to the Company's
response to an SEC comment letter. The aggregate fees billed by PwC for audit
related services for the year ended December 31, 2004 were $16,500 and primarily
related to the Company's analysis of FIN 46 on Variable Interest Entities.
Tax Fees
For the year ended December 31, 2005, the Company will pay Amper
approximately $25,000 related to tax services and for the year ended December
31, 2004, the Company paid PwC, approximately $54,000, related to tax services.
All Other Fees
There were no other fees for the years ended December 31, 2005 and
2004.
------------------------------------
14
PERFORMANCE GRAPH(3)
The following graph compares the five-year cumulative total return for
the Company's Common Stock with the comparable cumulative return of The NASDAQ
Stock Market(R) (U.S.) and NASDAQ Health Services Index. The comparisons in the
graph are based upon historical data and are not indicative of, nor intended to
forecast, future performance of the Company's Common Stock.
The graph assumes $100 was invested on December 31, 2000 in the
Company's Common Stock and $100 was invested at that same time in each of The
NASDAQ Stock Market (U.S.) and NASDAQ Health Services indexes. The comparison
assumes that all dividends were reinvested. Measurement points are at the last
trading day of the years ended December 31, 2000, 2001, 2002, 2003, 2004 and
2005.
[OBJECT OMITTED]
2000 2001 2002 2003 2004 2005
---- ---- ---- ---- ---- ----
IntegraMed America, Inc. 100.00 330.67 309.87 332.80 624.05 917.97
NASDAQ Stock Market (U.S.) 100.00 79.08 55.95 83.35 90.64 92.73
NASDAQ Health Services Index 100.00 108.29 92.53 128.80 159.27 172.19
------------------
(3) The material in this chart is not soliciting material, is not
deemed filed with the Commission and is not incorporated by reference in any
filing of the Company under the Securities Act of 1933 or the Exchange Act of
1934, whether made before or after the date of this Proxy Statement and
irrespective of any general incorporation language in such filing.
15
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has maintained a consulting arrangement with SDL
Consultants, a privately-owned consulting firm engaged in rendering general
business advice, of which Mr. Liebler is President. During the fiscal year ended
December 31, 2005 the Company paid SDL Consultants approximately $83,000 in
consulting fees, which were primarily related to services rendered to the
Company in assisting with the recruitment of several senior managers and
included reimbursement for expenses.
SHAREHOLDER PROPOSALS FOR 2007 ANNUAL MEETING
Under the Commission's proxy rules, stockholder proposals that meet
certain conditions may be included in the Company's proxy statement and form of
proxy for a particular annual meeting. Stockholders that intend to present a
proposal at the Company's 2007 Annual Meeting must give notice of the proposal
to the Company no later than December 15, 2006 to be considered for inclusion in
the proxy statement and form of proxy relating to that meeting. Stockholders
that intend to present a proposal at the 2007 Annual Meeting that will not be
included in the proxy statement and form of proxy must give notice of the
proposal to the Company no fewer than 90 days and no more than 120 days prior to
the first anniversary of the 2006 Annual Meeting. Receipt by the Company of any
such proposal from a qualified stockholder in a timely manner will not guarantee
its inclusion in the Company's proxy materials or its presentation at the 2007
Annual Meeting because there are other requirements in the proxy rules.
Pursuant to Rule 14a-4 under the Securities Exchange Act, as amended,
the Company intends to retain discretionary authority to vote proxies with
respect to shareholder proposals for which the proponent does not seek inclusion
of the proposed matter in the Company's proxy statement for our 2007 Annual
Meeting, except in circumstances where (i) the Company receives notice of the
proposed matter no earlier than January 23, 2007 and no later than February 23,
2007, and (ii) the proponent complies with the other requirements set forth in
Rule 14a-4.
GENERAL
The management of the Company does not know of any matters other than
those stated in this Proxy Statement, which are to be presented for action at
the 2006 Annual Meeting. If any other matters should properly come before the
meeting, it is intended that proxies in the accompanying form will be voted on
any such other matters in accordance with the judgment of the persons voting
such proxies. Discretionary authority to vote on such matters is conferred by
such proxies upon the persons voting them.
The Company will bear the costs related to preparing, printing,
assembling and mailing the proxy card, Proxy Statement and other material which
may be sent to stockholders in connection with this solicitation, which are
expected to be approximately $7,500.00. It is contemplated that brokerage houses
will forward the proxy materials to beneficial owners at the request of the
Company. In addition to the solicitation of proxies by use of the mails,
officers and regular employees of the Company may solicit by telephone proxies
without additional compensation. The Company does not expect to pay any
compensation for the solicitation of proxies.
The Company will provide without charge to each person being solicited
by this Proxy Statement, on the written request of any such person, a copy of
the Annual Report of the Company on Form 10-K for the fiscal year ended December
31, 2005 (as filed with the Commission), including the financial statements
thereto. All such requests should be directed to Mr. John W. Hlywak, Jr.,
Executive Vice President and Chief Financial Officer of IntegraMed America,
Inc., Two Manhattanville Road, Purchase, New York 10577. You may also obtain
certain other of the Company's Commission filings through the Internet at
http://www.sec.gov or under "Investor Relations" at http://www.integramed.com,
the Company's website.
Claude E. White
Vice President, General Counsel & Secretary
Dated: April 13, 2006
16
Appendix A
INTEGRAMED AMERICA, INC.
AUDIT COMMITTEE CHARTER
As Amended and Restated December 6, 2005
Purpose
The primary purpose of the Audit Committee (the "Committee") of the
Board of Directors (the "Board") of IntegraMed America, Inc. (the "Company") is
to assist the Board in its oversight of (a) the integrity of the Company's
financial statements and its financial reporting and disclosure practices, (b)
the soundness of the Company's accounting, auditing and financial reporting
practices, including the internal controls and audit functions (c) the Company's
compliance with legal and regulatory requirements, and (d) the appointment,
compensation, qualifications, independence and performance of the Company's
independent auditors.
Membership
The Committee shall consist of three or more directors all of whom, in
the judgment of the Board, shall be independent in accordance with the rules and
regulations of the Securities and Exchange Commission ("SEC") and NASDAQ listing
standards. Each member shall, in the judgment of the Board, be financially
literate under NASDAQ Rule 4350(d)(2), including having the ability to read and
understand the Company's basic financial statements or at the time of
appointment undertaking training for that purpose. At least one member of the
Committee shall, in the judgment of the Board, be a "financial expert" as
defined by Item 401(h) of Regulation S-K. Committee members shall not
simultaneously serve on the audit committee of more than two other public
companies, unless the Board determines that such simultaneous service would not
impair the ability of the director to effectively serve on the Committee, and
the Company discloses this determination in the Company's annual proxy
statement. The members of the Committee shall be appointed by the Board on the
recommendation of the Nominating and Governance Committee of the Board.
Committee members may be replaced by the Board.
Committee Authority and Responsibility
The Committee shall:
1. Appoint the independent auditors for the purpose of preparing and
issuing an audit report or to perform related work, and set such independent
auditors' compensation, and if appropriate, replace such independent auditors.
2. Pre-approve all audit and permitted non-audit services to be
performed by the Company's independent auditors; or delegate the authority to
pre-approve such services to one or more members of the Committee, who shall
report any decision to pre-approve any services to the full Committee at its
regularly scheduled meetings.
3. Report the pre-approval of any permitted non-audit services to
management for disclosure in the Company's periodic reports.
4. Review with the independent auditors selected by the Committee the
scope of the prospective audit, the estimated fees therefor and such other
matters pertaining to such audit as the Committee may deem appropriate.
5. Receive, review and discuss:
5.1 a report by the Company's independent auditors describing (i) the
Company's independent auditors internal quality-control procedures, (ii) any
A-1
material issues raised by the most recent internal quality control review, or
peer review, of the firm, or by any inquiry or investigation by governmental or
professional authorities, within the preceding five years, respecting one or
more independent audits carried out by the Company's independent auditors, and
any steps taken to deal with any such issues, (iii) in an effort to assess the
Company's independent auditors' independence, all relationships between the
Company's independent auditors and the Company and (iv) any significant
deficiencies and material weaknesses identified during their audit on
management's assessment of internal controls.
5.2 all other reports from the Company's independent auditors,
including the annual comments from the Company's auditors on accounting
procedures and systems of control.
5.3. copies of the annual comments from the Company's independent
auditors on accounting procedures and systems of control; review and consider
whether the provision by the Company's independent auditors of any permitted
non-audit services is compatible with maintaining their independence; review and
approve the non-audit fees of the Company's independent auditors; and review
with the Company's independent auditors any questions, comments or suggestions
they may have relating to the internal controls, accounting practices or
procedures of the Company or its subsidiaries, and any audit problems or
difficulties and management's responses.
6. Review, at least annually, the then current and future programs with
respect to the Company's internal audit procedures, including the procedure for
assuring implementation of accepted recommendations made by the Company's
independent auditors; and review any issues that arise regarding the performance
of the Company's internal audit function and the significant matters contained
in any internal audit function reports.
7. Make or cause to be made, from time to time, such other examinations
or reviews as the Committee may deem advisable with respect to the adequacy of
the systems on internal controls and accounting practices of the Company and its
subsidiaries and with respect to current accounting trends and developments, and
take such action with respect thereto as may be deemed appropriate.
8. Review with management and the Company's independent auditors the
annual and quarterly financial statements of the Company, including the
Company's disclosures under "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and any material changes in accounting
principles or practices used in preparing the statements prior to the filing of
a report on Form 10-K or 10-Q with the SEC. Such review will also include (1)
the items required by SAS 61 and SAS 90 as in effect at that time in the case of
the annual statements and SAS 71 and SAS 90 as in effect at that time in the
case of the quarterly statements, (2) the results of the independent auditor's
reviews of such financial statements, (3) the adequacy of the Company's internal
controls which could significantly affect the Company's financial statements and
(4) off-balance sheet structures on the Company's financial statements. During
such review, or otherwise, the Committee shall determine that the independent
auditors are satisfied with the disclosures in and contents of the financial
statements and shall inform management that the Committee is satisfied with the
inclusion of such disclosures and financial statements in the applicable Form
10-K or 10-Q which is to be filed with the SEC.
9. Review and discuss with management and the independent auditor, as
applicable, earnings press releases, as well as financial information and
earnings guidance provided to analysts and rating agencies.
10. Review and discuss with Company management Company policies with
respect to risk assessment and risk management.
11. Receive from the Company's independent auditors the report required
by Independence Standards Board Standards No. 1 as in effect at that time and
discuss it with the Company's independent auditors.
12. Review the status of compliance with laws, regulations, and
internal procedures, contingent liabilities and risks that may be material to
the Company, the scope and status of systems designed to assure Company
compliance with laws, regulations and internal procedures, through receiving
reports from management, legal counsel and other third parties as determined by
the Committee on such matters, as well as major legislative and regulatory
developments which could materially impact the Company's contingent liabilities
and risks.
A-2
13. Establish and maintain procedures for the confidential and
anonymous receipt, retention and treatment of complaints regarding the Company's
accounting, internal controls or auditing matters and establish clear hiring
policies for employees or former employees of the Company's independent
auditors.
14. Obtain the advice and assistance, as appropriate, of independent
counsel and other advisors as necessary to fulfill the responsibilities of the
Committee.
15. Report regularly to the Board as to the Committee's accomplishments
of its purposes and responsibilities.
16. Conduct an annual performance evaluation of the Committee and
deliver a written or oral report to the Board of Directors.
17. Review the Committee's charter and recommend any improvements to
the charter deemed necessary or desirable by the Committee.
18. Investigate, review and report on propriety and ethical
implications of any transactions reported to the Committee between the Company
and any employee, officer or member of the Board or any affiliate of the
foregoing.
19. Prepare the audit committee report required by the SEC to be
included in Company's proxy statement.
20. Review the experience and qualifications of the Company's senior
finance executives.
Meetings
The Committee shall meet as it determines, but not less frequently than
quarterly. Not less than two members shall be in attendance for a quorum. The
Committee shall meet periodically with management and the independent auditors
in separate executive sessions. The proceedings of all meeting shall be
reflected in written minutes, which shall be maintained with the records of
proceedings of the Board.
The Committee is governed by the same rules and regulations regarding
meetings (including meetings by teleconference or similar communications
equipment), action without meetings, notice waiver of notice, and quorum and
voting requirements as are applicable to the Board. The Committee may request
any officer or employee of the Company or the Company's outside counsel or
independent auditors to attend a meeting of the Committee or to meet with any
members of, or consultants to, the Committee.
Resources and Authority
The Committee shall have the resources and authority necessary to
discharge its duties and responsibilities, including authority to retain outside
counsel or other experts or consultants, as it deems appropriate. The Committee
shall have sole authority to approve related fees and retention terms.
Limitation of Audit Committee's Role
The Audit Committee's role is one of oversight. Management is
responsible for preparing the Company's financial statements, and the
independent auditors are responsible for auditing those financial statements.
Management is responsible for the fair presentation of the information set forth
in the financial statements in conformity with GAAP. The independent auditor's
responsibility is to provide their opinion, based on their audits, that the
financial statements fairly present, in all material respects, the financial
position, results of operations and cash flows of the Company in conformity with
GAAP. While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements and disclosures
are complete and accurate and in conformity with GAAP. Further, it is not the
duty of the Audit Committee to assure compliance with applicable laws and
regulations or the Company's Code of Ethical Conduct.
A-3
PROXY
INTEGRAMED AMERICA, INC.
Annual Meeting of Stockholders
This Proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Jay Higham or Claude E. White as
proxy to represent the undersigned at the Annual Meeting of Stockholders to be
held at the Company's Headquarters, Two Manhattanville Road, 3rd Floor,
Purchase, New York 10577 on May 23, 2006 at 10:00 a.m. and at any adjournments
thereof, and to vote the shares of Common Stock the undersigned would be
entitled to vote if personally present, as indicated on the reverse:
(To be Signed on Reverse Side)
Annual Meeting of Stockholders
INTEGRAMED AMERICA, INC.
May 23, 2006
Please date, sign and mail your
Proxy card in the envelope provided
as soon as possible!
Please Detach and Mail in the Envelope Provided
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE.
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1. Election of Directors: Nominees:
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-- FOR ALL NOMINEES --- Gerardo Canet
--- Jay Higham
--- Sarason D. Liebler
-- WITHHOLD AUTHORITY --- Wayne R. Moon
FOR ALL NOMINEES --- Lawrence J. Stuesser
--- Elizabeth E. Tallett
-- FOR ALL EXCEPT --- Yvonne S. Thornton, M.D.
(See instructions below)
INSTRUCTION: To withhold authority to vote for any individual
nominee(s), mark "FOR ALL, EXCEPT" and fill in the circle
next to each nominee you wish to withhold as shown here:
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In their discretion, proxies are authorized to vote upon such
business as may properly come before the meeting.
The shares of Common Stock represented by this proxy will be
voted as directed. If no contrary instruction is given, the shares of
Common Stock will be voted FOR the election of the nominees.
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To change the address on your account, please check the box at the right and
indicate your new address in the address space above. Please note that changes
to the registered name(s) on the account may not be submitted via this method.
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Signature of Stockholder Date
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Signature of Stockholder Date
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NOTE: Please sign exactly as your name or names appear on this Proxy.
When shares are held jointly, each holder should sign. When
signing as executor, administrator, attorney, trustee or guardian,
please give full title as such. If the signer is a corporation,
please sign full corporate name by duly authorized officer, giving
full title as such. If signer is a partnership, please sign in
partnership name by authorized person.