HMGN Hemagen Diagnostics Inc (CE)

Who may vote

Shareholders of Hemagen, as recorded in our stock register on March 24, 2011, may vote at the meeting. As of that date, Hemagen had 15,475,281 shares of Common Stock outstanding.

How to vote

You may vote in person at the meeting or by proxy. We recommend you vote by proxy even if you plan to attend the meeting. You can always change your vote at the meeting.

How proxies work

Hemagen’s Board of Directors is asking for your proxy. The costs of soliciting proxies will be borne by the Company. Giving us your proxy means that you are authorizing us to vote your shares at the meeting as you direct. You may vote for or withhold from voting for our Director candidate(s). You may vote for or against, or abstain from voting for the ratification of the appointment of independent public accountants and the amendment of the Company's Restated Certificate of Incorporation to increase the number of authorized shares of Common Stock.

If you sign and return the enclosed proxy card without specifying how to vote, we will vote your shares in favor of our Director candidate(s) and ratification of the appointment of independent public accountants.

If you hold shares through a stockbroker or other party, you may receive materials from them asking how you want them to vote your shares. You may receive more than one proxy card depending on how your shares are held. Shares registered in your name will be covered by one card.

Stockbrokers and other parties holding shares for beneficial owners must vote those shares as instructed. If the stockbroker or other party has not received instructions from you, the beneficial owner, the stockbroker or other party generally has discretionary voting power only with respect to the ratification of appointment of the independent public accountants. However, a stockbroker or other party does not have discretion to vote for or against the

election of Directors. In order to avoid a broker non-vote of your shares on the election of Directors, you must send voting instructions to such stockbroker or other party.

If any other matters come before the meeting or any postponement or adjournment thereof, each proxy will be voted at the discretion of the individuals named as proxies on the card.

Revoking a Proxy

You may revoke a proxy before it is voted by submitting a new proxy with a later date, by voting in person at the meeting or by notifying Hemagen’s Acting Secretary in writing at the address under “Questions” on page 9.

Quorum

In order to carry on the business of the meeting, we must have a quorum. This means that at least a majority of the outstanding shares eligible to vote must be represented at the meeting, either by proxy or in person.

Votes needed

The Director candidate receiving the most votes will be elected to fill the seat on the Board. Only votes for or against a proposal count. Abstentions and broker non-votes count for quorum purposes but not for voting purposes. As previously discussed, broker non-votes occur when a broker returns a proxy card but does not have authority to vote on a particular proposal.

ELECTION OF DIRECTORS

(Item 1 on the Proxy Card)

The Board of Directors has nominated and recommends that you vote FOR the re-election of William P. Hales as Director of the Company.

The Board of Directors oversees the management of Hemagen on your behalf. The Board reviews Hemagen’s long-term strategic plans and exercises direct decision-making authority in key areas, such as

choosing the executive officers, setting the scope of their authority to manage Hemagen’s business day to day, and evaluating management’s performance.

Hemagen’s Bylaws provide that the Board of Directors consists of three classes of Directors. Each class is elected for a three-year term with one class being elected each year.

The Board has nominated for re-election for a term expiring at the Annual Meeting in 2014,

William P. Hales. The terms of Alan S. Cohen and Edward T. Lutz expire in 2012 and 2013, respectively. The election of Directors is determined by a plurality of votes cast. Cumulative voting is not provided for in the election of Directors of Hemagen.

If a Director nominee becomes unavailable before the election, your proxy card authorizes us to vote for a replacement nominee if the Board names one.

RATIFICATION OF THE APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS

(Item 2 on the Proxy Card)

The Board of Directors recommends the ratification of Stegman and Company as independent public accountants for Fiscal 2011.

The Audit Committee of the Board of Directors has selected Stegman and Company as Hemagen's independent public accountants in fiscal 2011 and has directed management to submit the selection of Stegman and Company for ratification by the shareholders at the Annual Meeting. The affirmative vote of a majority of shares voting at the meeting is required for ratification. Shareholder ratification of Stegman and Company as the Company's independent accountants is not required by the Company's Bylaws or otherwise. However, the Board of Directors is submitting the selection of Stegman and Company to the shareholders for ratification as a matter of good corporate practice. If the shareholders fail to ratify the selection, the Audit Committee intends to continue the employment of Stegman and Company at least through fiscal 2011, but in its discretion may direct the appointment of a different independent accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company or its shareholders. Representatives of Stegman and Company are expected to be present at the Annual Meeting and will be given an opportunity to make a statement, if they so desire, and to respond to appropriate questions that may be asked by shareholders.

Principal Accounting Firm Fees:

Hemagen’s independent registered public accountants are Stegman and Company. Stegman and Company has served in this capacity beginning with fiscal year 2007.

Aggregate fees billed to Hemagen in Fiscal 2010 and 2009 by its principal accounting firm, Stegman and Company were:

Audit Fees . Audit services provided by Stegman and Company for Fiscal 2010 and 2009 consisted of examination of the consolidated financial statements of the Company, quarterly reviews of the financial statements and services related to the filings made with the Securities and Exchange Commission.

Fees Related to Tax Services. Tax fees included charges primarily related to the preparation of federal and state tax returns.

All of the services described above were approved by the Audit Committee. The Audit Committee has not adopted formal pre-approval policies, but has the sole authority to engage the Company’s outside auditing and tax preparation firms and must approve all tax consulting and auditing arrangements with the independent accounting firm prior to the performance of any services. Approval for such services is evaluated during the Audit Committee meetings and must be documented by signature of an Audit Committee member on the engagement letter of the independent accounting firm.

BOARD AND COMMITTEE INFORMATION

Board of Directors:

Hemagen Diagnostics, Inc. is an unlisted company and a smaller reporting company under the rules and regulations of the SEC. William P. Hales currently serves the Company in the combined role of

Chairman of the Board of Directors, President and Chief Executive Officer. The Company believes that Mr. Hales’ role as the Company’s principal executive officer gives him valuable insight into the day-to-day operational aspects of the Company’s business and how these aspects intersect with the Company’s overall business strategies and goals, which make him best-suited to lead the Board. At the same time the Company recognizes the importance of maintaining independent representation on the Board of Directors and, while the Company has not designated a lead independent Director, both Edward T. Lutz and Dr. Alan S. Cohen, who comprised a majority of the Board of Directors during Fiscal 2010, were “independent” Directors as independence is defined by the applicable rules of the SEC and the Nasdaq Stock Market.

The Board of Directors and the Company’s management actively oversee the Company’s risk management process. The Board’s role in the Company’s risk management is through its risk oversight function, whereas management’s primary role is to identify, prioritize and manage risks facing the Company in light of its business and the overall environment in which it operates. The Company’s leadership structure is designed to aid the Board in its oversight of management responsibility for risk. For this reason, the Company allocates different risk oversight functions among the various committees of the Board as follows. (1) the Audit Committee of the Board reviews of the Company’s financial reporting and internal reporting systems, as required by the Sarbanes-Oxley Act of 2002, including an evaluation of whether our financial reporting and internal reporting systems are adequately reporting the Company’s exposure to certain risks; (2) the Compensation Committee periodically evaluates the relationship between the Company’s executive compensation programs, plans and practices and risk; and (3) the Nominating Committee oversees the director nomination process.

The Board of Directors met four times in Fiscal 2010. All of these were held via telephone conference. The Audit Committee met separately. Dr. Cohen and Edward T. Lutz attended all meetings of the Board of Directors and all committee meetings of which they are members, all by telephone. All other Directors attended all meetings of the Board of Directors and the Committees of which they are members. No Director attended (whether in person, telephonically,

or by written consent) less than 75% of all meetings held during the period of time he served as Director during Fiscal 2010.

All Directors attended the Annual Meeting held on May 27, 2010 by telephone. The Company expects all Directors to attend shareholders’ meetings. Shareholders may communicate with the full Board or individual Directors on matters concerning Hemagen by mail to the attention of the Secretary.

The Board of Directors adopted a Code of Ethics Policy which was filed with Hemagen’s Form 10-KSB for the fiscal year ended September 30, 2003 and is also available upon written request to the Secretary.

Committees:

The Board appoints committees to help carry out its duties. In particular, Board committees work on key issues in greater detail than would be possible at full Board meetings. Each committee reviews the results of its meetings with the full Board.

The Audit Committee was established by the Board and is responsible for assisting the Board of Directors in its general oversight of Hemagen’s financial reporting, internal controls and audit function. It is also responsible for the appointment of independent accountants and reviews the relationship between Hemagen and its outside accountants. The Board of Directors has determined that Edward Lutz qualifies an audit committee financial expert as defined in regulations adopted by the Securities and Exchange Commission.

The Audit Committee of the Board of Directors met four times during Fiscal 2010.

REPORT OF THE AUDIT COMMITTEE

The Audit Committee of the Board of Directors is composed of Edward T. Lutz Chairman, and William P. Hales. Mr. Lutz meets the standards for independence provided under the Sarbanes-Oxley Act of 2002. All members meet standards of financial literacy.

The Audit Committee Charter was adopted by the Board of Directors in June 2000 and subsequently

amended and restated in March 2009. The Amended and Restated Charter is not at this time available on our website, but it is attached as Annex B to the 2009 Proxy Statement. The Amended and Restated Charter outlines the activities and responsibilities of the Committee.

The Committee has received from the independent auditors the written disclosures and the letter required by applicable requirements of the Public Company Accounting Oversight Board (the “PCAOB”) regarding the independent auditors’ communications with the Committee concerning independence, and has discussed with the auditors any relationships that may impact their objectivity and independence and satisfied itself as to the auditors’ independence from the Company and its management.

In discharging its oversight responsibility as to the audit process, the Committee reviewed and discussed with management Hemagen’s audited financial statements included in Hemagen’s Annual Report on Form 10-K for the year ended September 30, 2010. In addition, the Committee has discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards (SAS) No. 61, as amended (AICPA, Professional Standards, Vol. 1 AU section 380), as adopted by the PCAOB in Rule 3200T.

Based on the foregoing review and discussion, the Committee recommended to the Board of Directors that those audited financial statements be included in Hemagen’s Annual Report on Form 10-K for filing with the SEC.

Respectfully submitted,

The Audit Committee

Edward T. Lutz, Chairman

William P. Hales

The Compensation Committee is responsible for establishing compensation for management and administering certain of Hemagen’s plans. The Compensation Committee does not have a charter. In performing its duties, the Committee may delegate authority for day-to-day administration and interpretation of the plans, including selection of participants, determination of award levels within plan parameters, and approval of award documents, to officers of the Company. However, the Committee

may not delegate any authority under those plans for matters affecting the compensation and benefits of the executive officers. The Compensation Committee of the Board of Directors is composed of Dr. Alan S. Cohen (Chairman), William P. Hales and Edward T. Lutz.

The Compensation Committee of the Board of Directors held one meeting during Fiscal 2010.

The Nominating Committee is responsible for reviewing potential new candidates for the Board. The Nominating Committee does not have a charter and does not have a written policy with regard to the consideration of candidates recommended by shareholders. In practice, the committee evaluates and considers all candidates recommended by the Directors, officers and shareholders. While the Company has not established a formal policy with respect to diversity, in nominating directors, the Nominating Committee takes into account, among other factors which it may deem appropriate, the judgments, skill, diversity, business experience of the candidate, and the needs of the Board as its function relates to the business of the Company. The Committee considers candidates for nomination from a variety of sources, including recommendations of shareholders. Shareholders desiring to submit recommendations for nominations by the Committee should direct them to the Chairman in care of the Company at its address shown on the cover page of this proxy statement. The Nominating Committee of the Board of Directors is composed of William P. Hales, Chairman, Dr. Alan S. Cohen and Edward T. Lutz. Dr. Alan S. Cohen and Edward T. Lutz meet standards for independence as defined by the Nasdaq Stock Market.

The Nominating Committee of the Board of Directors did not meet during Fiscal 2010.

DIRECTOR COMPENSATION

Pursuant to the Company's 2007 Stock Incentive Plan, Non-employee Directors received a cash payment of $2,500 and 2,500 shares of Hemagen common stock per quarter during fiscal 2010. Non-Employee Directors of the Company are granted an option to purchase 10,000 shares of the Company’s common stock at the election of their three-year term. In addition, Non-Employee

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16 of the Securities Exchange Act of 1934 requires Hemagen’s Executive Officers, Directors and persons who own more than 10% of a registered class of Hemagen’s equity securities to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Based on a review of reports received by it, and upon written representations from the reporting persons, Hemagen believes that during the last fiscal year, all of its Executive Officers, Directors and 5% shareholders complied with Section 16 reporting.

SHAREHOLDER PROPOSALS FOR NEXT YEAR

The deadline for shareholder proposals to be included in the Proxy Statement for the 2012 Annual Meeting is December 2, 2011. Such proposals should be delivered to the Company at 9033 Red Branch Road, Columbia, Maryland 21045, Attn: Corporate Secretary.

The form of proxy card for this meeting grants authority to the designated proxies to vote in their discretion on any matters that come before the

meeting except those set forth in the Company’s Proxy Statement and except for matters as to which adequate notice is received. In order for a notice to be deemed adequate for the 2012 Annual Meeting, it must be received prior to February 15, 2012. If there is a change in the anticipated date of next year’s annual meeting or these deadlines by more than 30 days, we will notify you of this change through our Form 10-Q filings.

OTHER MATTERS

The Board of Directors knows of no other matters to be presented for shareholder action at the Annual Meeting. However, if other matters do properly come before the Annual Meeting or any adjournment or postponement thereof, the Board of Directors intends that the persons named in the proxies will vote upon such matters in accordance with their best judgment.

COMMUNICATIONS WITH DIRECTORS

Shareholders can send written communications to the Board as a group. Such communications must be clearly addressed either to the Board of Directors or any or all of the Non-Employee Directors, and sent to the Secretary at the following address, who will