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EX-31.1 - EX-31.1 - LIBERATOR MEDICAL HOLDINGS, INC. | g25897exv31w1.htm |
EX-32.2 - EX-32.2 - LIBERATOR MEDICAL HOLDINGS, INC. | g25897exv32w2.htm |
EX-31.2 - EX-31.2 - LIBERATOR MEDICAL HOLDINGS, INC. | g25897exv31w2.htm |
EX-32.1 - EX-32.1 - LIBERATOR MEDICAL HOLDINGS, INC. | g25897exv32w1.htm |
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K/A
(Amendment No. 1)
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended September 30, 2010
or
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number: 000-05663
LIBERATOR MEDICAL HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
NEVADA | 87-0267292 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
2979 SE Gran Park Way, Stuart, Florida 34997
(Address of principal executive offices)
(Address of principal executive offices)
(772) 287-2414
(Registrants telephone number, including area code)
(Registrants telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to section 12(g) of the Act: Common Stock, par value $0.001
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of
the Securities Act. Yes o No þ
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or
15(d) of the Exchange Act. Yes o No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes o No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
(§229.405 of this chapter) is not contained herein, and will not be contained, to the best of
registrants knowledge, in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K. þ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer o |
Accelerated filer o | Non-accelerated filer o | Smaller reporting company þ | |||||
(Do not check if a smaller reporting company) |
Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). Yes o No þ
The aggregate market value of the voting and non-voting shares of the Companys Common Stock held
by non-affiliates based on the last sale of the Common Stock on March 31, 2010, was approximately
$40,432,453.
The number of shares outstanding of the issuers Common Stock as of January 11, 2011, was
47,995,600.
DOCUMENTS INCORPORATED BY REFERENCE
None.
TABLE OF CONTENTS
Table of Contents
EXPLANATORY NOTE
On January 13, 2010, Liberator Medical Holdings, Inc. (Company, we, us, and our) filed its
Annual Report on Form 10-K for the year ended September 30, 2010 (the Original Filing), with the
Securities and Exchange Commission (the SEC). Pursuant to General Instructions G.(3), this
Amendment No. 1 (this Amendment) on Form 10-K/A is being filed to provide the disclosure required
by Part III of Form 10-K.
This Form 10-K/A only amends information in Part III, Item 10 (Directors, Executive Officers and
Corporate Governance), Item 11 (Executive Compensation), Item 12 (Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder Matters), Item 13 (Certain Relationship
and Related Transactions, and Director Independence), Item 14 (Principal Accounting Fees and
Services) and Part IV, Item 15 (Exhibits, Financial Statements and Schedules). All other items
presented in the Original Filing are unchanged. Except for the foregoing amended and restated
information, this Amendment does not amend, update or change any other information presented in the
Original Filing.
In addition, as required by Rule 12b-15 of the Securities Exchange Act of 1934, this Form 10-K/A
contains new certifications by our principal executive officer and our principal financial and
accounting officer, filed as exhibits hereto.
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PART III
Item 10. Directors, Executive Officers and Corporate Governance
As of the date of this Report the executive officers and directors of the Company are as follows:
Name | Age | Position(s) with the Company | ||||
Mark A. Libratore
|
60 | Director, President, and Chief Executive Officer | ||||
Robert J. Davis
|
64 | Chief Financial Officer | ||||
John Leger
|
55 | Chief Operating Officer | ||||
Robert Cuillo
|
75 | Director | ||||
Jeannette Corbett
|
60 | Director | ||||
Morgan Duke
|
35 | Director | ||||
Tyler Wick
|
40 | Director |
Each of the named persons served in the position following his or her names on September 30, 2010,
except Mr. Wick, who was elected a director on October 21, 2010.
The business experience of each of the persons listed above during the past five years is as
follows:
Mark A. Libratore. In 1990, Mr. Libratore founded Liberty Medical Supply, Inc., which has become
the nations largest direct-to-consumer diabetic supplier. Mr. Libratore sold this business to
PolyMedica Corporation in August 1996 and remained President of Liberty Medical and Senior Vice
President of PolyMedica until February 1999. Mr. Libratore founded Liberator Medical Supply, Inc.,
in 1999, and has served as its President and Chief Executive Officer since inception. Liberator
Medical Supply, Inc., was acquired by the Company on June 22, 2007, at which time he became
President and Chief Executive Officer of the Company.
Robert J. Davis has a Masters degree in Accounting, University of Houston, and holds a CPA
certificate from the State of Texas. Mr. Davis has held numerous financial executive-level
positions as Comptroller and Vice President of Finance for companies such as controller for a
Manufacturer of Jet Engine parts, TurboCombustor Corp., Data Development Inc., and Caribbean
Computer Corp., and served as CFO and Manager of Financial Planning for Liberty Medical Supply,
Inc. from 1995 to 1999. He has been the controller and Chief Financial Officer of Liberator Medical
Supply, Inc., since its organization.
John Leger joined Liberator in April 2006. John was the Senior VP of Operations at Liberty Medical
Supply from December 1991 through January 2004. He was responsible for diabetic call center
operations, customer services, repeat customer sales, document acquisition and management, claims
processing to Medicare, mail services, shipping, receiving, and purchasing. Mr. Leger worked
closely with Mark Libratore in building the mail order diabetes business to $100M in annualized
sales, and stayed on with the company through its growth to over 650,000 active customers. Due to
an agreement not to compete with Liberty during a severance agreement period, John made his
expertise available as an independent consultant until he joined Closer Healthcare, Inc. as a VP of
Operations in 2005. Closer is a mail order provider of diabetes testing supplies and primarily
serviced customers in national clinical trials as well as the managed care sector. He spent a year
with Closer prior to joining Liberator Medical.
Robert Cuillo is a four-year naval veteran of the Korean War. He graduated from New York
University and the City College of New York with an A.B.A. From 1958 to 1962, Mr. Cuillo worked
for the New York Police Department, where he was promoted to Detective. In 1962, Mr. Cuillo moved
to Florida and started working in the automotive industry. In 1967, he became a partner in a
Chrysler dealership that bore his name. In 1974, Mr. Cuillo became the sole owner of Palm Beach
Lincoln Mercury, West Palm Beach, Florida. He then formed Cuillo Enterprises and
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grew its payroll from 70 employees to over 700 employees. Mr. Cuillo has owned and operated a
total of 30 dealerships and related companies. He recently divested himself of all of his
dealerships. He is currently president and CEO of Cuillo Enterprises, Inc., and owns and operates
two-award winning wineries in Italy. Mr. Cuillo also owns and operates Forte, a West Palm Beach
restaurant, and recently became the co-owner of one of Palm Beachs premier restaurants, Amici.
Mr. Cuillo has been a director since December 3, 2009.
Jeannette Corbett is a certified public accountant, is President Emeritus of the Quantum
Foundation, as well as a director and Chairman of the Grants Committee. Previously, she served as
CFO of the Medical Services Division and Vice President of Finance of Phymatrix Corporation (PHMX),
based in West Palm Beach, FL. Prior to her position at Phymatrix, Mrs. Corbett was President of
McGill, Roselli, Ayala & Hoppmann, a West Palm Beach-based accounting firm. She has also served as
an adjunct instructor of taxation of Palm Beach State College in Lake Worth, Florida. Mrs. Corbett
has a bachelors of science degree in business administration from the University of Florida,
graduating Summa Cum Laude. Mrs. Corbett was Chairman of the Board of JFK Medical Center in
Atlantis, Florida, from 1991-1994 and was Chair of the Hospitals Finance Committee from 1989-1991.
Ms. Corbett has been a director since February 26, 2010.
Morgan Duke is an Associate at Kinderhook Partners, an investment partnership which makes long-term
investments in small public companies, including the Company. Mr. Duke was previously a strategy
consultant with the Monitor Group, where he advised senior management and directors of major public
and private companies in North America and Europe across a range of industries, including
healthcare, media, and telecommunications. Mr. Duke received an M.B.A. from Harvard University and
a B.A. from Johns Hopkins University. Mr. Duke also studied music at the Peabody Conservatory.
Mr. Duke has been a director since June 4, 2010.
Tyler Wick co-founded Ticonderoga Capital, Inc., Waltham, Massachusetts, in 1998. Mr. Wick has
over sixteen years of industry tenure, including fourteen years of private equity experience. His
private equity experience includes serving as an Associate at Dillon Read Venture Capital, Boston,
Massachusetts, from January to December 1997. From June 2004 to December 2006, Mr. Wick was an
Associate in the healthcare practice of the investment-banking group of Advest, Inc., Boston,
Massachusetts, where he focused on private placements and mergers and acquisitions for middle
market healthcare services companies. Mr. Wick was a consultant with the Mentor Group, an
international legal consulting firm in Boston, Massachusetts, from July 1993 to May 1994. Mr. Wick
is a member of the Board of Directors of numerous private companies. Mr. Wick received a B.A.
degree cum laude from Amherst College.
Director Compensation
The directors, other than Mr. Libratore, receive (i) annual compensation of $10,000, payable
quarterly; (ii) $1,000 for each Board meeting attended; and (iii) a one-time issuance
of options for the purchase of 50,000 common shares of the Company, exercisable at the market price
at the date of grant and vesting over a two-year period. Mr. Libratore receives no compensation as
a director.
The following table sets forth director compensation in the year ended September 30, 2010:
DIRECTOR COMPENSATION
Fees Earned | ||||||||||||
or | ||||||||||||
Paid in Cash | Option | |||||||||||
Name | ($) | Awards ($) | Total ($) | |||||||||
Mark A. Libratore (1) |
| | | |||||||||
Joseph D. Farish, Jr. (2) |
$ | 13,170 | $ | 24,570 | $ | 37,740 | ||||||
Robert Cuillo |
$ | 12,330 | $ | 20,550 | $ | 32,880 | ||||||
Jeannette Corbett |
$ | 9,830 | $ | 13,220 | $ | 23,050 |
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Fees Earned | ||||||||||||
or | ||||||||||||
Paid in Cash | Option | |||||||||||
Name | ($) | Awards ($) | Total ($) | |||||||||
Morgan Duke (3) |
$ | 5,250 | $ | 6,220 | $ | 11,470 | ||||||
Tyler Wick (4) |
| | |
(1) | Mr. Libratore is not compensated for his services as a director. | |
(2) | Mr. Farish was a Board member until his death on September 13, 2010. | |
(3) | At the direction of Mr. Duke his compensation is paid to Kinderhook Partners, L.P. See Item 12, Security Ownership of Certain Beneficial Owners and Management, footnote (10). | |
(4) | Tyler Wick succeeded Mr. Farish as a Board member on October 21, 2010. |
Board of Directors and Committees
Leadership Structure and Risk Oversight
Our business and affairs are managed under the direction of our Board of Directors, composed of
four non-employee directors and one employee director as of the date of this Report. Our shares of
common stock are quoted on the OTCBB and not one of the national securities exchanges. However, we
have adopted the NYSE Amex corporate governance requirements with respect to independent directors
on the Board and the Audit, Nominating and Corporate Governance, and Compensation Committees, and
NYSE Amexs corporate governance requirements applicable to smaller reporting companies.
Our Board of Directors as a whole establishes our overall policies and standards, reviews the
performance of management and considers the Companys overall risk regarding the Companys
operations and goals and how those risks are being managed. Members of the Board of Directors are
kept informed of our operations at meetings of the Board of Directors and its Board committees and
through reports and discussions with management. In addition, members of the Board of Directors
periodically visit our facilities. Members of management are available at Board of Directors
meetings and at other times to answer questions and to discuss issues. Mark Libratore, the Chief
Executive Officer of our Company, is Chairman of the Board of Directors. Our Company combines the
positions of CEO and Chairman of the Board because of the size of the company and the efficiency
involved. A lead independent director has not been designated because the Board does not believe it
is warranted for a company of our size and complexity.
Risk is inherent in every business. As is the case in virtually all businesses, we face a number of
risks, including operational, economic, financial, legal, regulatory, and competitive risks. Our
management is responsible for the day-to-day management of the risks we face. Our Board of
Directors, as a whole and through its committees, has responsibility for the oversight of risk
management.
In its oversight role, our Board of Directors involvement in our business strategy and strategic
plans plays a key role in its oversight of risk management, its assessment of managements risk
appetite, and its determination of the appropriate level of enterprise risk. Our Board of Directors
receives updates at least quarterly from senior management and periodically from outside advisors
regarding the various risks we face, including operational, economic, financial, legal, regulatory,
and competitive risks. Our Board of Directors also reviews the various risks we identify in our
filings with the SEC as well as risks relating to various specific developments, such as
acquisitions, securities repurchases, debt and equity placements, and product introductions.
Our Board committees assist our Board of Directors in fulfilling its oversight role in certain
areas of risk. Pursuant to its charter, the Audit Committee oversees the financial and reporting
processes of our Company and the audit of the financial statements of our Company and provides
assistance to our Board of Directors with respect to the oversight and integrity of the financial
statements of our Company, our Companys compliance with legal and regulatory matters, the
independent registered public accountants qualification and independence, and the performance of
our independent registered public accountant. The Compensation Committee considers the risk that
our compensation policies and practices may have in attracting, retaining, and motivating valued
employees and endeavors to assure that it is not reasonably likely that our compensation plans and
policies would have a material
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adverse effect on our Company. Our Governance and Nominating Committee oversees governance related
risk, such as board independence, conflicts of interests, and management and succession planning.
Director Meetings and Committees
Pursuant to NYSE Amex corporate governance requirements, we are required to hold meetings of our
Board of Directors on at least a quarterly basis, and our independent directors must meet at least
annually in an executive session with only the independent directors present. We do not have a
policy with regard to directors attendance at annual meetings of shareholders, but we encourage
our directors to attend the annual meetings. Our Board of Directors held five (5) meetings in
fiscal 2010.
Our Board of Directors has an Audit Committee, a Compensation Committee, and a Governance and
Nominating Committee.
Nominations Process, Executive Compensation; Director Independence; Board Diversity
We are not required to have Audit, Compensation, or Governance and Nominating Committees, but we
have chosen to meet voluntarily NYSE Amex requirements. The NYSE Amex requires that director
nominations be selected, or recommended for the Board of Directors selection, either by a majority
of independent directors or a nominating committee comprised solely of independent directors. The
NYSE Amex also requires compensation of the executive officers to be determined, or recommended to
the Board for determination, either by a majority of the independent directors or a compensation
committee comprised solely of independent directors. Ms. Corbett and Messrs. Cuillo and Wick meet
the independence standards set forth in the NYSE Amex Company Guide.
Candidates for independent Board members have typically been found through recommendations from
directors or others associated with us. Our shareholders may also recommend candidates by sending
the candidates name and resume to the Board of Directors under the provisions set forth below for
communication with our Board. No such suggestions from our shareholders were received in time for
our Annual Meeting. We have no predefined minimum criteria for selecting Board nominees and do not
have a formal diversity policy, although we believe that the independent directors should have a
range of relevant experience, independence, diversity and strong communication and analytical
skills. In any given search, our independent directors may also define particular characteristics
for candidates to balance the overall skills and characteristics of our Board and our perceived
needs. However, during any search, our independent directors reserve the right to modify its stated
search criteria for exceptional candidates.
Audit Committee
The Audit Committee consists of Robert Cuillo, Jeannette Corbett and Tyler Wick. Ms. Corbett serves
as Chairperson. As we have chosen to follow NYSE Amex governance requirements, our Audit Committee
must have at least two members and be comprised only of independent directors each of whom
satisfies the respective independence requirements of the Securities and Exchange Commission and
the NYSE Amex. Our Board of Directors has determined that all of our current Audit Committee
members are independent, as that term is defined under the independence standards for audit
committee members in the Securities Exchange Act of 1934, as amended, and in the listing standards
of the NYSE Amex. The Board of Directors has also determined that Jeannette Corbett is an audit
committee financial expert, as that term is defined in Item 407 of Regulation S-K.
The Audit Committee is responsible for reviewing and helping to ensure the integrity of our
financial statements. Among other matters, the Audit Committee, with management and our independent
auditors, reviews the adequacy of our internal accounting controls that could significantly affect
our financial statements, reviews with the independent accountants the scope of their audit, their
report and their recommendations, and recommends the selection of our independent accountants. The
Audit Committee was established on June 4, 2010, and from that date through September 30, 2010,
held one meeting in addition to the meetings of the entire Board of Directors through September 30,
2010. Ms. Corbett and Mr. Cuillo attended the meeting of the Audit Committee. Mr. Wick joined the
Board and the Audit Committee on October 21, 2010. The Board of Directors adopted and maintains a
written
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charter for the Audit Committee which is published on the investor relations page of our
website (www.liberatormedical.com).
Compensation Committee
The purpose of the Compensation Committee includes determining, recommending to our Board of
Directors for determination, the compensation of the Chief Executive Officer and other executive
officers of our Company and discharging responsibilities of the Board of Directors relating to
compensation programs for our Company. The Compensation Committee currently consists of Morgan
Duke, Jeannette Corbett and Tyler Wick, of whom Ms. Corbett and Mr. Wick are independent directors
of our Company under NYSE Amex standards. Mr. Duke is chairman of the Compensation Committee.
The Compensation Committee, with the advice of an outside consulting firm, determines compensation
for our executive officers and managers by multiple factors, including individual performance,
compensation of persons in similar capacities in other companies having a size and business
comparable to the Company, performance, and our financial results. Base salaries are supplemented
by cash performance bonuses and stock option awards determined by our Compensation Committee in
October of each year based on the prior year financial results. Consistent with our objective of
attracting and retaining highly qualified and experienced employees, we establish base salary
ranges for our executive officers that are intended to be competitive for comparable positions.
Base salary data for comparable industry positions are reviewed annually from survey data obtained
from our compensation consultant, Markson HRC, L.L.C., a Georgia limited liability company, and
other pertinent sources. Annual salary increases are tied to objective performance-based criteria
established by the Compensation Committee. The Board of Directors adopted and maintains a written
charter for the Compensation Committee which is published on the investor relations page of our
website (www.liberatormedical.com).
Governance and Nominating Committee
The purpose of the Governance and Nominating Committee includes the selection and recommendation to
our Board of Directors of nominees to stand for election as directors at each election of
directors, the oversight of the selection and composition of committees of our Board of Directors,
the oversight of the evaluation of our Board of Directors and management and the development and
recommendation to our Board of Directors and the set of corporate governance principals applicable
to our Company. The Governance and Nominating Committee currently consists of Messrs. Cuillo, Duke
and Ms. Corbett, all of whom are independent directors of our Company under NYSE Amex standards.
The Board of Directors adopted and maintains a written charter for the Governance and Nominating
Committee which is published on the investor relations page of our website
(www.liberatormedical.com). Mr. Cuillo is chairman of the Governance and Nominating
Committee.
The Governance and Nominating Committee will consider persons recommended by stockholders for
inclusion as nominees for election to our Board of Directors if the information required by our
bylaws is submitted in writing in a timely manner, addressed and delivered to our Secretary at the
address of our executive offices set forth in this Report. The Governance and Nominating Committee
identifies and evaluates nominees for our Board of Directors, including nominees recommended by
stockholders, based on numerous factors it considers appropriate, some of which may include
strength of character, mature judgment, career specialization, relevant technical skills,
diversity, and to the extent to which the nominee would fill a present need on our Board of
Directors.
Board Diversity
We seek diversity in experience, viewpoint, education, skill, and other individual qualities and
attributes to be represented on our Board of Directors. We believe directors should have various
qualifications, including individual character and integrity; business experience; leadership
ability; strategic planning skills, ability, and experience; requisite knowledge of our industry
and finance, accounting, and legal matters; communications and interpersonal skills; and the
ability and willingness to devote time to our Company.
We also believe the skill sets, backgrounds, and qualifications of our directors, taken as a whole,
should provide a significant mix of diversity in personal and professional experience, background,
viewpoints, perspectives, knowledge, and abilities. Nominees are not to be discriminated against on
the basis of race, religion, national origin,
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sex, sexual orientation, disability, or any other
basis prescribed by law. The assessment of prospective directors is made in the context of the
perceived needs of our Board of Directors from time to time.
All of our directors have held high-level positions in business or professional service firms and
have experience in dealing with complex issues. We believe that all of our directors are
individuals of high character and integrity, are
able to work well with others, and have committed to devote sufficient time to the business and
affairs of our Company. In addition to these attributes, the description of each directors
background set forth above indicates the specific experience, qualifications, and skills necessary
to conclude that each individual should continue to serve as a director of our Company.
Board Leadership Structure
We believe that effective Board leadership structure can depend on the experience, skills, and
personal interaction between persons in leadership roles as well as the needs of our Company at any
point in time. Our Corporate Governance Guidelines support flexibility in the structure of our
Board of Directors by not requiring the separation of the roles of Chief Executive Officer and
Chairman of the Board.
Compensation Committee Interlocks and Insider Participation
Until October 29, 2009, when Joseph D. Farish, Jr., now deceased, became a Director, our Board of
Directors consisted of one (1) director, Mark Libratore, our President and Chief Executive officer,
who determined the compensation of our named executive officers. Commencing June 4, 2010, the
Companys Board of Directors created a Compensation Committee, the members of which are
non-employee directors.
Annual Meeting Attendance
We encourage each of our directors to attend each annual meeting of stockholders. To that end, and
to the extent reasonably practicable, we regularly schedule a meeting of our Board of Directors on
the same day as our annual meeting of stockholders. The Company held five (5) meetings of its Board
of Directors in the fiscal year ended September 30, 2010. All members of the Board attended all of
those meetings.
Communications with Directors
Interested parties may communicate with our Board of Directors or specific members of our Board of
Directors, including our independent directors and the members of our various board committees, by
submitting a letter addressed to the Board of Directors of Liberator Medical Holdings, Inc., c/o
any specified individual director or directors at the address of our executive offices set forth in
this Report. Any such letters are sent to the indicated directors.
Item 11. Executive Compensation
Compensation Discussion and Analysis
Overview
The Compensation Committee is authorized to determine and approve, or make recommendations to our
Board of Directors with respect to, the compensation of our Chief Executive Officer and other
executive officers and grant or recommend the grant of stock-based compensation to our Chief
Executive Officer and other executive officers under our 2007 Stock Plan. The Compensation
Committee from time to time makes recommendations regarding the compensation of employees who are
not executive officers.
The compensation program for our executive officers consists primarily of base salary,
performance-based incentive compensation, and long-term incentives in the form of stock-based
compensation, including stock options, restricted stock, restricted stock units, and other
long-term equity incentives. Our executive officers also participate in other benefit plans,
including medical and retirement plans, which generally are available to all regular full-time
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employees of our Company. We consider each element of compensation collectively with other elements
of compensation when establishing the various forms, elements, and levels of compensation for our
executive officers.
Our philosophy is to pay base salaries to our executive officers at levels that enable us to
attract, motivate, and retain highly qualified executives. We annually establish a
performance-based incentive compensation program designed to reward individuals for performance
based primarily on our financial results as well as the achievement of
corporate and individual objectives that contribute to our long-term goal of building stockholder
value. Our stock-based compensation is intended to result in limited rewards if the price of our
common stock does not appreciate or does not appreciate above certain levels, but may provide
substantial rewards to our executive officers (as well as to our stockholders in general) if our
stock appreciates or appreciates above certain levels. Our stock-based compensation is also
intended to align the interests of our executive officers with those of our stockholders and to
align compensation with the price performance of our common stock. Total compensation levels
reflect corporate positions, responsibilities, and achievement of goals. As a result of our
performance-based philosophy to compensation, compensation levels may vary from year-to-year and
among our various executive officers. In general, we expect the compensation level of our Chief
Executive Officer to be higher than that of our other executive officers, assuming relatively equal
achievement of individual performance goals, since our compensation policies set our base salaries,
incentive compensation, and stock-based compensation after reviewing those of comparable companies,
which generally compensate the chief executive officers at higher levels because of their roles and
their importance to overall Company success.
The Compensation Committee generally recommends base salary levels for executive officers of our
Company at the beginning of each fiscal year and recommends incentive compensation at the end of
each fiscal year based upon the performance of our Company and our executive officers.
Goals
The goals of our executive compensation program are as follows:
| to attract, motivate, and retain highly qualified executives; | ||
| to reflect our Companys culture and approach to total rewards, which includes benefits, work environment, and development opportunities; | ||
| to reflect our philosophy of pay-for-performance; | ||
| to provide a rational and consistent approach to compensation, which is understood by senior leadership; | ||
| to align compensation to the interests of our Company as a whole and its stockholders; and | ||
| to recognize corporate stewardship and fiscal responsibility. |
Code of Ethics
We adopted a Code of Conduct and Ethics that applies to all officers, directors and employees of
our Company on January 14, 2008, as amended on August 10, 2010. Our Code of Conduct and Ethics is
posted on our website, www.liberatormedical.com, or the Company will provide a copy to any
person without charge, upon request made to Robert J. Davis, Chief Financial Officer, 2979 SE Gran
Park Way, Stuart, Florida 34997.
Employment Agreements
On December 1, 2008, we entered into employment agreements with Mark A. Libratore, to secure his
continued service as our President and Chief Executive Officer, with Robert Davis to secure his
continued service as our Chief Financial Officer, and with John Leger to secure his continued
service as our Chief Operating Officer. The employment agreement for Mr. Libratore has a two-year
term and the employment agreement for each of Messrs. Davis and Leger has a one-year term, which
term, in each case, will be automatically extended prior to the end of then current term for
successive one-year periods until either we or the executive officer notifies the other
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party at
least 90 days prior to the end of the term that such party does not wish to further extend the
term. Each employment agreement provides for a minimum annual salary of $260,000, $190,000 and
$160,000, in the case of Messrs. Libratore, Davis and Leger, respectively, which salary is reviewed
annually by our Board and the Compensation Committee and adjusted upward, at the sole discretion of
our Board. Pursuant to the agreements, each of Messrs. Libratore, Davis and Leger is eligible to
receive additional cash incentive compensation pursuant to our annual bonus plan then in effect,
and the target annual bonus for each of Messrs. Libratore, Davis and Leger is up to 15%,
10% and 10%, respectively, of such executive officers annual base salary, with the actual bonus to
be based upon such individual and/or Company performance criteria established for each fiscal year
by our board of directors in consultation with the executive officer. Each executive officer is
also eligible to participate in distributions from the quarterly executive bonus plan configured by
our President and Chief Financial Officer.
Each executive officer is entitled to participate in our stock purchase plan and to be considered
by our board of directors (or compensation committee of our board of directors, if any) for grants
or awards of stock, stock options or warrants under any of our stock incentive or similar plans in
effect from time to time. Each is eligible to participate in such health and other group insurance
and other employee benefit plans and programs in effect from time to time on the same basis as
other senior executives.
The employment agreements provide that each executive officer is entitled to severance benefits. If
the executive officers employment is terminated during the term by us other than for Cause or
Disability (each as defined below), or by the executive officer for Good Reason (as defined
herein), the executive officer will be entitled to receive (i) his pro-rata bonus for the fiscal
year of termination, (ii) payment of an amount equal to the sum of 1/12 of his annual base salary
and 1/12 of the target annual bonus each month for 18 months, 12 months and six months, in the case
of Messrs. Libratore, Davis and Leger, respectively, following termination, and (iii) continuation
of medical benefits on the same terms as active senior executives for 18 months, 12 months and six
months, in the case of Messrs. Libratore, Davis and Leger, respectively, following termination. In
addition, all of the executive officers unvested options outstanding at the time of such
termination will become fully vested. If the executive officers employment with us is terminated
due to the executive officers death or Disability, the executive officer (or his estate, if
applicable) will be entitled to receive (i) the pro-rata bonus and (ii) option vesting. Receipt of
the severance payments, continued medical coverage and option vesting shall be conditioned on the
executive officers continued compliance with the non-disclosure, non-competition and
non-solicitation obligations under the employment agreement. For purposes of the employment
agreements, the following terms have the following meanings:
Cause means termination upon (i) the willful and continued failure by executive officer to
substantially perform his duties or the oral or written instructions of our President, Chief
Executive Officer and/or board of Directors (other than any such failure resulting from executive
officers incapacity due to physical or mental illness) after an oral or written demand for
substantial performance is delivered to executive officer by our President, Chief Executive Officer
of board of directors, which demands specifically identifies the manner in which President, Chief
Executive Officer of board of directors believes that executive officer has not substantially
performed his duties or complied with an instruction from our President, Chief Executive Officer of
board of directors; (ii) the willful engaging by executive officer in conduct that is demonstrably
and materially injurious to us; (iii) the failure to observe material policies generally applicable
to our officers or employees; (iv) the failure to cooperate with any internal investigation of our
Company or any of our affiliates; (v) commission of any act of fraud, theft or financial dishonesty
with respect us or any of our affiliates or indictment or conviction of any felony; or (vi)
material violation of the provisions of the employment agreement.
Disability means the executive officer is entitled to receive long-term disability benefits under
our long-term disability plan in which the executive officer participates, or, if there is no such
plan, the executive officers inability, due to physical or mental ill health, to perform the
essential functions of the executive officers job, with or without a reasonable accommodation, for
180 days during any 365 day period irrespective of whether such days are consecutive.
Good Reason means (i) a material and adverse change in the executive officers duties or
responsibilities; (ii) a reduction in the executive officers base salary or target annual bonus;
(iii) a relocation of the executive officers principal place of employment by more than 50 miles;
or (iv) breach by us of any material provision of the employment agreement; provided, that the
executive officer must give notice of termination for Good Reason within 60 days of the occurrence
of the first event giving rise to Good Reason.
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During the term of the employment agreements and for a period of 18 months thereafter, subject to
applicable law, the executives will be subject to restrictions on competition with us and
restrictions on the solicitation of our customers and employees. For all periods during and after
the term, the executives will be subject to nondisclosure and confidentiality restrictions relating
to our confidential information and trade secrets.
SUMMARY COMPENSATION TABLE
The following table provides summary information regarding compensation earned by the named
executive officers during the fiscal years ended September 30, 2010, 2009 and 2008.
All Other | ||||||||||||||||||||||||
Name | Option | Compensation | ||||||||||||||||||||||
and Principal Position | Year | Salary($) | Bonus ($) | Awards($) | ($)(1) | Total ($) | ||||||||||||||||||
Mark A. Libratore |
2010 | $ | 317,000 | $ | 190,480 | $ | 22,520 | $ | 42,700 | $ | 572,700 | |||||||||||||
President and Chief |
2009 | $ | 230,000 | $ | 88,070 | $ | 2,810 | $ | 43,090 | $ | 363,970 | |||||||||||||
Executive Officer |
2008 | $ | 130,013 | $ | 24,713 | $ | 12,894 | $ | 40,078 | $ | 207,698 | |||||||||||||
Robert Davis |
2010 | $ | 247,000 | $ | 115,020 | $ | 33,310 | $ | 4,120 | $ | 399,450 | |||||||||||||
Chief Financial Officer |
2009 | $ | 166,920 | $ | 56,870 | $ | 9,680 | $ | 5,650 | $ | 239,120 | |||||||||||||
2008 | $ | 92,497 | $ | 19,951 | $ | 15,892 | $ | 2,458 | $ | 130,798 | ||||||||||||||
John Leger |
2010 | $ | 179,000 | $ | 117,510 | $ | 25,250 | $ | 5,770 | $ | 327,530 | |||||||||||||
Chief Operating Officer |
2009 | $ | 151,920 | $ | 55,850 | $ | 6,470 | $ | 6,040 | $ | 220,280 | |||||||||||||
2008 | $ | 125,017 | $ | 17,332 | $ | 9,536 | $ | 2,458 | $ | 154,343 |
(1) | All Other Compensation includes expenses paid on behalf of the named executive officers for health insurance, life insurance, transportation and certain other personal expenses. |
Outstanding Equity Awards at 2010 Fiscal Year End
On September 14, 2007, the Company issued options to the named executive officers and others under
the Companys 2007 Stock Plan. On January 2, 2008, the Company rescinded all outstanding options
effective as of their date of issuance because they did not conform to the 2007 Stock Plan.
Accordingly, there were no outstanding equity awards at 2007 fiscal year end. On January 2, 2008,
the Company issued new options under, and in conformity with, the Companys 2007 Stock Plan to the
named executive officers and others in the same amounts, and under the same terms, as the rescinded
options. On February 16, 2008, the Company rescinded all outstanding options effective as of their
date of issuance. Also on February 16, 2008, the Company issued new options under, and in
conformity with, the Companys Stock Plan to certain employees, not including the named executive
officers, in the same amounts, and under the same terms, as the rescinded options. On April 14,
2008, the Company issued new options under and in conformity with, the Companys Stock Plan to the
named executive officers and one other employee, in the same amounts, and under the same terms, as
the rescinded options. On October 30, 2008, the Company issued new options under the 2007 Stock
Plan to two of the named executive officers and other employees. On August 18, 2009, the Company
issued additional options under the 2007 Stock Plan to the named executive officers and other
employees. The Companys outstanding equity awards to the named executive officers at September 30,
2010, are set forth in the following table:
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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
Number of | Number of | |||||||||||||||
Securities | Securities | |||||||||||||||
Underlying | Underlying | |||||||||||||||
Unexercised | Unexercised | Option | Option | |||||||||||||
Options (#) | Options (#) | Exercise | Expiration | |||||||||||||
Name | Exercisable | Unexercisable | Price ($) | Date | ||||||||||||
Mark A. Libratore |
100,000 | | $ | 0.825 | April 14, 2013 | |||||||||||
45,000 | 45,000 | $ | 1.10 | August 18, 2014 | ||||||||||||
Robert J. Davis |
100,000 | | $ | 0.75 | April 14, 2013 | |||||||||||
50,000 | 50,000 | $ | 0.60 | October 30, 2013 | ||||||||||||
50,000 | 50,000 | $ | 1.00 | August 18, 2014 | ||||||||||||
John Leger |
60,000 | | $ | 0.75 | April 14, 2013 | |||||||||||
30,000 | 30,000 | $ | 0.60 | October 30, 2013 | ||||||||||||
40,000 | 40,000 | $ | 1.00 | August 18, 2014 |
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Equity Compensation Plans
2007 Stock Plan
Our 2007 Stock Plan (the 2007 Plan) was adopted by our Board of Directors and was approved by our
stockholders at our annual stockholder meeting on September 10, 2008. Stock options, stock
appreciation rights, or SARs, stock awards and cash awards may be granted under the 2007 Plan. Each
is referred to as an award in the 2007 Plan. Options granted under the 2007 plan may be either
incentive stock options, as defined under Section 422 of the Internal Revenue Code of 1986, as
amended, or non-statutory stock options. The number of shares of common stock to be reserved and
available for awards under the 2007 Stock Plan (subject to certain adjustments as provided therein)
is 2,105,000.
On September 4, 2009, our stockholders approved an amendment to the 2007 Stock Plan that increased
the number of shares reserved and available for awards to 2,000,000. On December 29, 2010, the
Board of Directors voted to increase the reserved and available number of our shares to 2,105,000,
The increase was immediately effective and will be submitted to shareholders for ratification at
the Companys next annual shareholders meeting.
The 2007 Plan is administered by the Board of Directors acting through the Compensation Committee.
Awards under the 2007 plan may be granted to our employees, directors and consultants. Incentive
stock options may be granted only to our employees. The administrator, in his discretion, approves
awards granted under the 2007 Plan. Generally, if an awardees service to us terminates other than
by reason of death, disability, and retirement or for cause, vested options and SARs will remain
exercisable for a period of thirty days.
The plan terminates on September 13, 2017. In the event of a termination of service of a
participant or death of a participant, the award grant may provide for exercise within a reduced
period. Unless otherwise determined by the
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administrator, awards granted under the 2007 Plan are
not transferable other than by will, domestic relations order, or the laws of descent or
distribution may be exercised during the awardees lifetime only by the awardees.
The administrator determines the exercise price of options at the time the options are granted. The
exercise price of an incentive stock option may not be less than 100% of the fair market value of
our Common Stock on the date of grant. The term of an option may not be more than ten years from
the date of grant. No option may be exercised after the expiration of its term. Any incentive stock
option granted to a ten percent stockholder may not have a term of more than five years. The
administrator may grant SARs alone, in addition to, or in tandem with, any other awards under the
plan. An SAR entitles the participant to receive the amount by which the fair market value of a
specified number of shares on the exercise date exceeds an exercise price established by the
administrator. The excess amount will be payable on ordinary shares, in cash or in a combination
thereof, as determined by the administrator. The terms and conditions of an SAR will be contained
in an award agreement. The grant of an SAR may be made contingent upon the achievement of objective
performance conditions.
The administrator may grant stock awards such as bonus stock, restricted stock or restricted stock
units. Generally, such awards will contain vesting features such that awards will either not be
delivered, or may be repurchased by us at cost, if the vesting requirements are not met. The
administrator will determine the vesting and shared delivery terms.
The following table presents details of Liberators equity compensation plan as of September 30,
2010:
Equity Compensation Plan Information
Number of securities remaining | ||||||||||||
available for future issuance under | ||||||||||||
Number of securities to be | Weighted-average | equity compensation plans | ||||||||||
issued upon exercise of | exercise price of | (excluding securities reflected in | ||||||||||
outstanding options | outstanding options | column (a)) | ||||||||||
Plan Category | (a) | (b) | (c) | |||||||||
2007 Employee Stock Incentive Plan |
1,655,000 | $ | 0.92 | 345,000 |
Stock Repurchase Program
Under a stock repurchase program approved by our Board of Directors in December 2008, we were
authorized to repurchase up to $500,000 of our Common Stock through December 31, 2009. The
authorization enabled the Company to purchase shares through open market transactions at
managements discretion. We retained any common shares which we repurchased as treasury shares and
may use them in connection with our employee stock option program.
Our shares repurchased for the year ended September 30, 2010, were as follows:
Total Number of | Approximate Dollar | |||||||||||||||
Total | Shares Purchased as | Value of Shares that | ||||||||||||||
Number of | Average | Part of Publicly | May Yet Be | |||||||||||||
Shares | Price Paid | Announced Plans or | Purchased Under the | |||||||||||||
Purchased | per Share | Programs (2) | Plans or Programs(2) | |||||||||||||
October 131, 2009 (1) |
| $ | | |||||||||||||
November 130, 2009(1) |
4,000 | $ | 2.26 | |||||||||||||
December 131, 2009 (1) |
| $ | | |||||||||||||
Total |
4,000 | $ | 2.26 | 89,600 | $ | 0 | ||||||||||
(1) | In December 2008, we opened a separate money market account with an investment bank pursuant to which we transferred $50,000 into the account, of which $9,055 was used to purchase 4,000 shares during the fiscal year ended September 30, 2010. |
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(2) | As of September 30, 2010, 89,600 cumulative shares have been purchased under our stock repurchase program for $49,634. The stock repurchase program ended on December 31, 2009, and no additional shares have been authorized to be repurchased. |
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information regarding ownership of shares of our common stock, as of
January 11, 2011:
| by each person known by us to be the beneficial owner of 5% or more of our common stock; | ||
| by each of our directors and executive officers; and | ||
| by all of our directors and executive officers as a group. |
Except as otherwise indicated, each person and each group shown in the table has sole voting and
investment power with respect to the shares of common stock indicated. For purposes of the table
below, in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, a
person is deemed to be the beneficial owner, of any shares of our common stock over which he or she
has or shares, directly or indirectly, voting or investment power or of which he or she has the
right to acquire beneficial ownership at any time within 60 days. As used in this prospectus,
voting power is the power to vote or direct the voting of shares and investment power includes
the power to dispose or direct the disposition of shares. Common stock beneficially owned and
percentage ownership was based on 47,995,600 shares outstanding on January 11, 2011, plus 6,838,509
shares deemed outstanding pursuant to Rule 13d-3, for a total of 54,834,109 shares outstanding.
Unless otherwise indicated, the address of each beneficial owner is c/o Liberator Medical Holdings,
Inc., 2979 SE Gran Park Way, Stuart, Florida 34997.
Name and Address | Number of Shares | Percent | ||||||
5% Beneficial Owners: |
||||||||
Millennium Partners, L.P.(1) c/o Millennium Management LLC 666 Fifth Avenue, 8th Floor New York, NY 10103 |
8,838,202 | (2) | 16.12 | % | ||||
Kinderhook Partners, L.P. One Executive Drive, Suite 160 Fort Lee, NJ 07024 |
4,679,167 | (3) | 8.53 | % | ||||
Directors and Executive Officers: |
||||||||
Mark A. Libratore President and Chief Executive Officer and Director |
19,750,117 | (4) | 36.02 | % | ||||
Robert Davis Chief Financial Officer |
539,023 | (5) | * | |||||
John Leger, Vice President, Operations |
274,749 | (6) | * | |||||
Tyler Wick |
87,500 | (7) | * | |||||
Robert S. Cuillo |
25,000 | (8) | * | |||||
Jeannette Corbett |
25,000 | (9) | * | |||||
Morgan Duke |
0 | (10) | 0 | % | ||||
All directors and executive officers as a group (7 persons) |
20,701,389 | (11) | 37.75 | % | ||||
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* | Less than one percent (1%). | |
(1) | Millennium Management LLC, a Delaware limited liability company (Millennium Management), is the general partner of Millennium Partners, L.P., a Cayman Islands exempted limited partnership (Millennium Partners), and may be deemed to have shared voting control and investment discretion over securities owned by Millennium Partners. Millennium Management is also the general partner of the 100% shareholder of ICS Opportunities, Ltd., and may be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities, Ltd. Millennium International Management, L.P., a Delaware limited liability partnership, is the investment manager of ICS Opportunities, Ltd., and may be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities, Ltd. Millennium International Management GP LLC, a Delaware limited liability company, is the general partner of Millennium International Management, and may also be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities, Ltd. Israel A. Englander is the managing partner of Millennium Management and Millennium International Management GP LLC, and consequently may also be deemed to have shared voting control and investment discretion over securities owned by Millennium Partners or ICS Opportunities, as the case may be. The foregoing information is derived from the reporting persons as set forth in a Schedule 13D Amendment filed with the SEC on behalf of the reporting persons on October 19, 2010. | |
(2) | Represents as of January 11, 2011, an aggregate 7,899,079 shares owned beneficially by Millennium Partners, L.P., 8,838,202 shares owned beneficially by Millennium Management LLC and Israel Englander (See footnote (1), above), and 939,123 shares owned beneficially by Millennium International Management GP LLC, Millennium International Management LP, and ICS Opportunities, Ltd. Does not include 4,375,000 shares of our common stock issuable upon exercise of a warrant held by Millennium Partners at an initial exercise price of $1.25 per share, subject to adjustment, which has a term of three years. The number of shares of our common stock for which such warrants can be exercised is limited pursuant to the terms of the warrants so that number of shares of the common stock which will result in Millennium Partners, together with its affiliates, having aggregate beneficial ownership of not more than 9.99% of our total issued and outstanding common stock. Thus, as of January 11, 2011, Millennium Partners may be deemed not to beneficially own any of the shares of common stock underlying its warrants pursuant to Rule 13d-3 under the Securities Exchange Act of 1934. | |
(3) | In connection with the Kinderhook Partners, L.P.s (the Partnership) election of Mr. Morgan Duke, an associate of the Partnership, to the Board of Directors of the Issuer, Kinderhook Capital Management LLC (Kinderhook Capital), an affiliate of the Partnership, received an option to purchase 50,000 shares of the Companys Common Stock at $1.55 per share, vesting semi-annually over two years beginning on December 4, 2010. Shah Tushar Shah and Stephen J. Clearman are the co-managing members of the Kinderhook GP, LLC (the General Partner) responsible for making investment decisions with respect to the Partnership and, as a result, Mr. Shah and Mr. Clearman may be deemed to control such entities. In addition, Mr. Shah and Mr. Clearman are responsible for making investment decisions with respect to Kinderhook Capital. Accordingly, Mr. Shah and Mr. Clearman may be deemed to have a beneficial interest in the shares of Common Stock by virtue of their indirect control of the Partnerships, the General Partners and Kinderhook Capitals power to vote and/or dispose of the shares of Common Stock. Mr. Shah and Mr. Clearman each disclaims beneficial ownership of the shares of Common Stock except to the extent of his respective pecuniary interest, if any, therein. | |
(4) | Includes 4,107,259 shares underlying options exercisable by Mr. Libratore within 60 days of January 11, 2011. Does not include 78,750 shares underlying options that are not exercisable within 60 days of January 11, 2011. | |
(5) | Includes 268,750 shares underlying options exercisable, and 6,000 shares underlying warrants exercisable by Mr. Davis within 60 days of January 11, 2011. Does not include 106,250 shares underlying options that are not exercisable within 60 days of January 11, 2011. | |
(6) | Includes 170,000 shares underlying options exercisable by Mr. Leger within 60 days of January 11, 2011. Does not include 50,000 shares underlying options that are not exercisable within 60 days of January 11, 2011. | |
(7) | Includes 12,500 shares underlying options exercisable by Mr. Wick within 60 days of January 11, 2011. Does not include 37,500 shares underlying options that are not exercisable within 60 days of January 11, 2011. | |
(8) | Includes 25,000 shares underlying options exercisable by Mr. Cuillo within 60 days of January 11, 2011. Does not include 25,000 shares underlying options that are not exercisable within 60 days of January 11, 2011. | |
(9) | Includes 25,000 shares underlying options exercisable by Ms. Corbett within 60 days of January 11, 2011. Does not include 25,000 shares underlying options that are not exercisable within 60 days of January 11, 2011. | |
(10) | Mr. Duke is a director of the Company and is an associate at Kinderhook Partners, L.P. (Kinderhook). Mr. Dukes appointment to the Board of Directors of the Company was made pursuant to commitments of the Company and its |
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principal shareholder and President, Mark Libratore, to Kinderhook in connection with Kinderhooks purchase of common stock of the Company on March 9, 2010. Pursuant to a Form 3 filed by Mr. Duke on June 11, 2010, Mr. Duke disclaims beneficial ownership in any securities of the Company. | ||
(11) | See Footnote Nos. (4) through (10) |
Item 13. Certain Relationships and Related Transactions, and Director Independence
All transactions between the Company and related parties are reviewed and approved by our Audit
Committee, which is made up entirely of independent directors. We collect information about
related party transactions from our officers and directors through annual questionnaires
distributed to officers and directors. Each director and officer agrees to abide by our Code of
Business Conduct and Ethics, which provides that officers and directors should avoid conflicts of
interest and that any transaction or situation that could involve a conflict of interest between
the Company and the officer or director must be reported to the Audit Committee of the Board and is
subject to approval by the Audit Committee if and when appropriate. The Code of Conduct and Ethics
identifies a non-exclusive list of situations that may present a conflict of interest, including
significant dealings with a competitor, customer or supplier, similar dealings by an immediate
family member, personal investments in entities that do business with the Company, and gifts and
gratuities that influence a persons business decisions, as well as other transactions between an
individual and the Company. The Audit Committees charter provides that the Audit Committee will
review, investigate and monitor matters pertaining to the integrity or independence of the Board,
including related party transactions. The Audit Committee reviews and makes determinations about
related party transactions or other conflicts of interest as they arise. Policies requiring review
and approval of any transaction or arrangement with a director or executive officer that may
present a conflict of interest are set forth in the Code of Conduct and Ethics.
The Company paid $150,000 and $950,000 during Fiscal Years 2009 and 2010 to its President and CEO,
Mark Libratore, as repayment on stockholder loans. The balance of the stockholder loans at the
date of this Report is $0.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Companys directors, its
executive officers, any persons who hold more than ten percent of the Companys common stock and
certain trusts (collectively, insiders) to report their holdings of and transactions in the
Companys common stock to the Securities and Exchange Commission (the SEC). Specific due dates
for these reports have been established, and the Company is required to disclose in this Report any
late filings and any failures to file that have occurred since October 1, 2009. Insiders must file
three types of ownership reports with the SEC: initial ownership reports, change-in-ownership
reports and year-end reports. Under the SECs rules, insiders must furnish the Company with copies
of all Section 16(a) reports that they file. Based solely on a review of copies of these reports
and on written representations the Company has received, the Company believes that during fiscal
2010 and through the date of this Report its insiders have complied with all applicable Section
16(a) reporting requirements.
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Item 14. Principal Accounting Fees and Services
The following table sets forth fees billed to the Company by the Companys independent auditors for
the years ended September 30, 2010 and 2009, for (i) services rendered for the audit of the
Companys annual financial statements and the review of the Companys quarterly financial
statements; (ii) services rendered that are reasonably related to the performance of the audit or
review of the Companys financial statements that are not reported as Audit Fees; (iii) services
rendered in connection with tax preparation, compliance, advice and assistance; and (iv) all other
services:
Berenfeld, Spritzer, | ||||||||||||
Crowe Horwath, LLP | Shechter, & Sheer, LLP | |||||||||||
2010 | 2010 | 2009 | ||||||||||
Audit fees |
$ | 82,125 | $ | 34,825 | $ | 103,175 | ||||||
Audit related fees |
| 4,800 | 1,225 | |||||||||
Tax fees |
| 4,975 | 33,400 | |||||||||
All other fees |
| | | |||||||||
Total Fees |
$ | 82,125 | $ | 44,600 | $ | 137,800 | ||||||
The engagement of Crowe Horwath LLP, Certified Public Accountants, as the Companys independent
registered public accounting firm for the Fiscal year ended September 30, 2010, was ratified and
approved by the Board of Directors of the Company on August 19, 2010.
PART IV
Item 15. Exhibits and Financial Statement Schedules
The following exhibits designated with a footnote reference are incorporated herein by reference to
a prior registration statement or a periodic report filed by the Registrant pursuant to Section 13
or 15(d) of the Exchange Act:
Number | Description | |
31.1
|
Section 302 Certificate of Chief Executive Officer (1) | |
31.2
|
Section 302 Certificate of Chief Financial Officer (1) | |
32.1
|
Section 906 Certificate of Chief Executive Officer (1) | |
32.2
|
Section 906 Certificate of Chief Financial Officer (1) |
(1) | Filed herewith. |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the Registrant
has duly caused this Form 10-K/A and any subsequent amendments thereto to be signed on its behalf
by the undersigned, thereunto duly authorized.
LIBERATOR MEDICAL HOLDINGS, INC. |
||||
Dated: January 26, 2011 | By: | /s/ Mark A. Libratore | ||
Mark A. Libratore, President | ||||
Pursuant to the requirements of the Securities Exchange Act of 1934, the following persons on
behalf of the registrant and in the capacities and on the dates indicated have signed this report
below.
Signature | Title | Date | ||
/s/ Mark A. Libratore
|
President, Chief Executive Officer and Director | January 26, 2011 | ||
Mark A. Libratore
|
(principal executive officer) | |||
/s/ Robert J. Davis
|
Chief Financial Officer | January 26, 2011 | ||
Robert J. Davis
|
(principal financial and accounting officer) | |||
/s/ Jeannette Corbett
|
Director | January 26, 2011 | ||
Jeannette Corbett
|
||||
/s/ Robert Cuillo
|
Director | January 26, 2011 | ||
Robert Cuillo
|
||||
/s/ Morgan Duke
|
Director | January 26, 2011 | ||
Morgan Duke
|
||||
/s/ Tyler Wick
|
Director | January 26, 2011 | ||
Tyler Wick
|
18