<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/x/ Definitive Proxy Statement
/ / Soliciting Material pursuant to Section 24.14a-11(c) or Section
240.14a-12
HOUSECALL MEDICAL RESOURCES, 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):
/ / No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
(1) Title of each class of securities to which transaction applies:
---------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
---------------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):
---------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------
(5) Total fee paid:
---------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date
of its filing.
(1) Amount Previously Paid:
---------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
---------------------------------------------------------------
(3) Filing Party:
---------------------------------------------------------------
(4) Date Filed:
---------------------------------------------------------------
<PAGE>
Housecall Medical Resources, Inc.
1000 Abernathy Road
Building 400, Suite 1825
Atlanta, Georgia 30328
November 4, 1996
To Our Shareholders:
On behalf of the Board of Directors and management of Housecall
Medical Resources, Inc., I cordially invite you to the Annual Meeting of
Shareholders to be held on December 6, 1996, at 1:00 p.m., at 1000
Abernathy Road, Building 400, 3rd Floor, Conference Room C, Atlanta,
Georgia 30328.
At the Annual Meeting, shareholders will be asked to elect six (6)
directors of the Company, all of whom are currently directors of the
Company. Information about these persons and certain other matters is
contained in the accompanying Proxy Statement. A copy of the Company's
1996 Annual Report to Shareholders, which contains financial statements
and other important information about the Company's business, is also
enclosed.
It is important that your shares of stock be represented at the
meeting, regardless of the number of shares you hold. You are encouraged
to specify your voting preferences by marking and dating the enclosed
proxy card. However, if you wish to vote for reelecting the directors,
all you need to do is sign and date the proxy card.
Please complete and return the proxy card in the enclosed envelope
whether or not you plan to attend the meeting. If you do attend and wish
to vote in person, you may revoke your proxy at that time.
We hope you are able to attend, and look forward to seeing you.
Sincerely,
/s/ George D. Shaunnessy
George D. Shaunnessy
PRESIDENT AND CHIEF EXECUTIVE OFFICER
<PAGE>
HOUSECALL MEDICAL RESOURCES, INC.
1000 Abernathy Road
Building 400, Suite 1825
Atlanta, Georgia 30328
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 6, 1996
-------------------------
To the Shareholders of
Housecall Medical Resources, Inc.:
Notice is hereby given that the Annual Meeting of Shareholders of
Housecall Medical Resources, Inc. will be held at 1:00 p.m. on Friday,
December 6, 1996, at 1000 Abernathy Road, Building 400, 3rd Floor,
Conference Room C, Atlanta, Georgia 30328 for the following purposes:
1. To elect six directors to constitute the Board of Directors
to serve until the next annual meeting and until their successors are
elected and qualified;
2. Such other matters as may properly come before the meeting
and any adjournment or postponement thereof.
Only shareholders of record on October 25, 1996, are entitled to
notice of and to vote at the Annual Meeting and any adjournment or
postponement thereof.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Peter J. Bibb
Peter J. Bibb
November 4, 1996 SECRETARY
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE ANNUAL MEETING, PLEASE
FILL IN, DATE, SIGN, AND PROMPTLY RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED BUSINESS REPLY ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN
THE UNITED STATES. THE PROXY MAY BE REVOKED AT ANY TIME PRIOR TO
EXERCISE, AND IF YOU ARE PRESENT AT THE ANNUAL MEETING, YOU MAY, IF YOU
WISH, REVOKE YOUR PROXY AT THAT TIME AND EXERCISE THE RIGHT TO VOTE YOUR
SHARES PERSONALLY.<PAGE>
[HOUSECALL LOGO]
PROXY STATEMENT
Dated November 4, 1996
For the Annual Meeting of Shareholders
To be Held December 6, 1996
This Proxy Statement is furnished to shareholders in connection with
the solicitation of proxies by the Board of Directors of Housecall
Medical Resources, Inc. ("Housecall" or the "Company") for use at
Housecall's 1996 Annual Meeting of Shareholders ("Annual Meeting") to be
held on Friday, December 6, 1996, including any postponement,
adjournment, or adjournments thereof, for the purposes set forth in the
accompanying Notice of Annual Meeting. Management intends to mail this
Proxy Statement and the accompanying form of proxy to shareholders on or
about November 5, 1996.
Only shareholders of record at the close of business on October 25,
1996 (the "Record Date"), are entitled to notice of and to vote in person
or by proxy at the Annual Meeting. As of the Record Date, there were
10,218,900 shares of common stock, $.01 par value per share ("Common
Stock"), of Housecall outstanding and entitled to vote at the Annual
Meeting. The presence of a majority of such shares is required, in
person or by proxy, to constitute a quorum for the conduct of business at
the Annual Meeting. Each share is entitled to one vote on any matter
submitted for vote by the shareholders.
Proxies in the accompanying form, duly executed and returned to the
management of the Company, and not revoked, will be voted at the Annual
Meeting. Any proxy given pursuant to this solicitation may be revoked by
the shareholder at any time prior to the voting of the proxy by delivery
of a subsequently dated proxy, by written notification to the Secretary
of the Company, or by personally withdrawing the proxy at the Annual
Meeting and voting in person.
Proxies that are executed but which do not contain any specific
instructions will be voted for the election of all the nominees for
directors specified herein and in the discretion of the persons appointed
as proxies on any other matter that may properly come before the Annual
Meeting or any postponement, adjournment or adjournments thereof,
including any vote to postpone or adjourn the Annual Meeting.
A copy of the Company's 1996 Annual Report to Shareholders is being
furnished herewith to each shareholder of record as of the close of
business on October 25, 1996. Additional copies of the 1996 Annual
Report to Shareholders and copies of the Company's Annual Report on Form
10-K for the fiscal year ended June 30, 1996 will be provided free of
charge upon written request to:
HOUSECALL MEDICAL RESOURCES, INC.
1000 ABERNATHY ROAD
BUILDING 400, SUITE 1825
ATLANTA, GEORGIA 30328
ATTN: INVESTORS RELATIONS DEPARTMENT
If the person requesting the Form 10-K was not a shareholder of
record on October 25, 1996, the request must include a representation
that the person was a beneficial owner of Common Stock on that date.
Copies of any exhibits to the Form 10-K will also be furnished on request
and upon payment of the Company's expenses in furnishing the exhibits.
-1-
<PAGE>
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS
The following table sets forth the information concerning the
beneficial ownership of Common Stock, which is the only class of voting
stock of the Company, at October 1, 1996, by (i) each person known to the
Company to beneficially own more than 5% of the Common Stock, (ii) each
director, nominee for director, and designated highly compensated
executive officer, and (iii) all directors and executive officers of the
Company as a group. Unless otherwise indicated below, the persons named
below had sole voting and investment power with respect to all shares of
the Common Stock shown as beneficially owned by them.
<TABLE>
<CAPTION>
Shares Beneficially
Name of Beneficial Owner Owned Percent<F1>
- ------------------------ ------------------- ----------
<S> <C> <C>
Welsh, Carson, Anderson & Stowe, VI, L.P.<F2> 4,651,614 46.0%
George D. Shaunnessy <F3> 153,705 1.5%
Peter J. Bibb <F4> 75,902 *
Harold W. Small <F4> 85,235 *
Thomas F. Luthringer <F4> 89,335 *
J. Paul Gordon <F5> 108,000 1.0%
James E. Dalton <F6> 6,668 *
Howard R. Deutsch <F6> 12,918 *
James B. Hoover <F7> 5,128,848 50.2%
Andrew M. Paul <F8> 5,123,211 50.1%
R. Dale Ross <F6> 8,755 *
All Directors and Executive Officers as a Group 5,686,913 53.6%
(10 persons) <F9>
___________________
* Denotes less than 1%.
<FN>
<F1> The percentages shown are based on 10,218,900 shares of the Common
Stock outstanding on October 1, 1996 plus, as to each person and group
listed, the number of shares of Common Stock deemed owned by such
holder pursuant to Rule 13d-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), assuming the exercise of
options held by such holder that are exercisable within 60 days of
October 1, 1996.
<F2> Does not include an aggregate of 134,485 shares owned individually
by the general partners of the general partner of Welsh, Carson,
Anderson & Stowe, V.I., L.P. ("Welsh Carson"). Each general partner
of Welsh Carson may be deemed to beneficially own all the shares owned
by Welsh Carson. It also does not include an aggregate of 609,515
shares held by other affiliates of Welsh Carson. The address of Welsh
Carson is 320 Park Avenue, Suite 2500, New York, New York 10022.
<F3> Includes 141,805 shares of Common Stock subject to presently
exercisable stock options.
<F4> Includes 70,902 shares of Common Stock subject to presently
exercisable stock options.
<F5> Includes 8,000 shares of Common Stock subject to presently
exercisable stock options.
<F6> Includes 6,668 shares of Common Stock subject to presently
exercisable stock options.
<F7> The number of shares beneficially owned consists of 23,184 shares
held directly by Mr. Hoover, 4,651,614 shares held by Welsh Carson and
454,050 shares held by an affiliate of Welsh Carson. Mr. Hoover is a
general partner of the general partner of Welsh Carson and an
affiliate of Welsh Carson and, as such, shares voting and investment
power with respect to the shares owned by such entities. Does not
include 155,465 shares held by an affiliate of Welsh Carson.
-2-<PAGE>
<F8> The number of shares beneficially owned consists of 17,547 shares
held directly by Mr. Paul, 4,651,614 shares held by Welsh Carson and
454,050 shares held by an affiliate of Welsh Carson. Mr. Paul is a
general partner of the general partner of Welsh Carson and an
affiliate of Welsh Carson and, as such, shares voting and investment
power with respect to the shares owned by such entities. Does not
include 155,465 shares held by an affiliate of Welsh Carson.
<F9> Includes 382,515 shares of Common Stock subject to presently
exercisable stock options and 5,105,664 shares deemed beneficially
owned by Messrs. Hoover and Paul as general partners of the general
partner of Welsh Carson and an affiliate of Welsh Carson.
</FN>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Mr. Deutsch inadvertently failed to timely report on Form 4 a
purchase of Common Stock in the Company's initial public offering. Each
of Messrs. Gordon and Ross inadvertently failed to file on a timely basis
a Form 3 to report his ownership of Common Stock as of the date the
Company became public.
ELECTION OF DIRECTORS
(Item Number 1 on the Proxy Card)
The by-laws of Housecall provide that the Board of Directors shall
consist of not less than two nor more than eleven directors, with the
exact number being set from time to time by the Board. The Board
presently consists of six directors, each of whom serves for a one-year
term until the next annual meeting of shareholders and until his
successor, if there is to be one, is elected and qualified. Each of the
nominees is listed below and is presently serving as a director of the
Company.
Directors are elected by a plurality of the votes cast by the
holders of shares of Common Stock entitled to vote for the election of
directors at a meeting at which a quorum is present. A quorum will be
present for the Annual Meeting when the holders of a majority of the
shares outstanding on the Record Date are present in person or by proxy.
An abstention and a broker non-vote are included in determining whether a
quorum is present, but will not affect the outcome of the vote. Unless
otherwise indicated on a proxy, all duly executed proxies granted by the
holders of Common Stock will be voted individually at the Annual Meeting
for the election of each nominee. Each nominee has indicated that he
will serve if elected, but if the situation should arise that any nominee
is no longer able or willing to serve, the proxy may be voted for the
election of such other person as may be designated by the Board of
Directors. Each person elected as a director shall serve a term that
continues until the next annual meeting and until his successor, if there
is to be one, is duly elected and qualified.
-3-
<PAGE>
GEORGE D. SHAUNNESSY PRESIDENT AND CHIEF EXECUTIVE OFFICER
HOUSECALL MEDICAL RESOURCES, INC.
Mr. Shaunnessy, age 48, has served as President, Chief Executive Officer
and a director since his founding of the Company with Welsh Carson and
Messrs. Bibb, Small and Luthringer in June 1994. Prior to the founding
of the Company, Mr. Shaunnessy had served as President, Chief Operating
Officer, and a director of Hallmark Healthcare Corporation, formerly
known as National Healthcare, Inc. ("Hallmark"), from 1988 to 1991,
following which he served as a management consultant with Mr. Bibb to
various businesses until the Company was founded. Mr. Shaunnessy has
over twenty years of experience in the health care industry. He is a
member of the Executive Committee.
JAMES B. HOOVER GENERAL PARTNER
WELSH, CARSON, ANDERSON & STOWE
Mr. Hoover, age 41, has been Chairman of the Board of the Company since
its founding. Mr. Hoover is a general partner of Welsh, Carson, Anderson
& Stowe, a New York-based management buy-out firm that focuses on
acquisitions of companies in the health care and information services
industry, which he joined in 1992. Prior to that time, he had been a
General Partner (from 1984 to 1992) of Robertson, Stephens & Company, an
investment banking firm, where he was responsible for the firm's health
care corporate finance group. From 1977 to 1984, Mr. Hoover was a Vice
President of the Investment Management Group of Citibank, N.A., where he
specialized in health care investments. Mr. Hoover is a member of the
Executive and Compensation Committees of the Board of Directors. He is a
director of U.S. Physical Therapy, Inc.
JAMES E. DALTON, JR. PRESIDENT AND CHIEF EXECUTIVE OFFICER
QUORUM HEALTH GROUP, INC.
Mr. Dalton, age 54, has served since 1990 as President and Chief
Executive Officer of Quorum Health Group, Inc., a publicly held company
that owns hospitals and provides management and consulting services to
third party owners. Prior to 1990, Mr. Dalton had served as Regional
Vice President (from 1987 to 1990) with Healthtrust, Inc., a Division
Vice President (from 1979 to 1987) with Hospital Corporation of America,
and Regional Vice President (from 1978 to 1979) with HCA Management
Company (now Quorum Health Resources, Inc., a subsidiary of Quorum Health
Group, Inc.). Mr. Dalton has served as a director of the Company since
1994 and is a member of the Compensation Committee.
HOWARD R. DEUTSCH EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
LINCARE, INC.
Mr. Deutsch, age 41, has served as Executive Vice President and General
Counsel and a director of Lincare, Inc., since its founding in 1987, and
as Executive Vice President and General Counsel and a director of Lincare
Holdings, Inc., the publicly-held parent company of Lincare, Inc., since
its formation in 1990. From 1980 to 1987, Mr. Deutsch served as Division
Counsel for Union Carbide. Mr. Deutsch has served as a director of the
Company since 1994 and is a member of its Compensation and Audit
Committees.
ANDREW M. PAUL GENERAL PARTNER
WELSH, CARSON, ANDERSON & STOWE
Mr. Paul, age 40, has served as a general partner since 1984 of Welsh,
Carson, Anderson & Stowe. Prior to that time, he was an associate in the
Venture Capital Group of Hambrecht & Quist Incorporated for one year, and
-4-
<PAGE>
from 1978 to 1981, he was a systems engineer and then a marketing
representative for IBM. Mr. Paul has served as a director of the Company
since 1994 and is a member of the Executive and Audit Committees. Mr.
Paul is a director of National Surgery Centers, Inc., American Oncology
Resources, Inc., Lincare Holdings, Inc., Medcath, Incorporated, and
EmCare Holdings, Inc.
R. DALE ROSS CHIEF EXECUTIVE OFFICER AND CHAIRMAN OF THE BOARD
AMERICAN ONCOLOGY RESOURCES, INC.
Mr. Ross, age 49, has served since 1992 as Chief Executive Officer and
Chairman of the Board of American Oncology Resources, Inc. ("AOR"), a
publicly held company engaged in physician practice management. Prior to
joining AOR, Mr. Ross founded HMSS, Inc., a company engaged in infusion
therapy services, in 1982, and served as its President, Chief Executive
Officer and a director until the company was sold in 1989. Mr. Ross has
served as a director of the Company since 1994 and is a member of the
Audit Committee.
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors of the Company meets on a regular basis to
supervise, review, and direct the business and affairs of the Company.
During the Company's 1996 fiscal year, the Board held five meetings. The
Board of Directors has established an Executive, an Audit and a
Compensation Committee, to which it has assigned certain responsibilities
in connection with the governance and management of the Company's
affairs. The Company has no standing nominating committee or other
committee performing similar functions.
Each of the directors attended at least 75% of the Board meetings
and meetings of committees on which he served.
EXECUTIVE COMMITTEE. The Executive Committee, pursuant to authority
delegated by the Board, from time to time considers certain matters in
lieu of convening a meeting of the full Board, subject to any
restrictions in applicable law related to the delegation of certain
powers to a committee of the Board. Messrs. Hoover, Shaunnessy, and Paul
comprise the members of the Executive Committee. The Executive Committee
held five meetings during fiscal 1996.
AUDIT COMMITTEE. The Audit Committee recommends the appointment of
independent public accountants, reviews the scope of audits proposed by
the independent public accountants, reviews internal audit reports on
various aspects of corporate operations, and periodically consults with
the independent public accountants on matters relating to internal
financial controls and procedures. Messrs. Deutsch, Paul, and Ross
comprise the members of the Audit Committee. The Audit Committee, as such,
did not hold any meetings during fiscal 1996, as the Board of Directors,
as a whole, performed the functions of the Audit Committee during that year.
COMPENSATION COMMITTEE. The Compensation Committee is responsible
for the review and approval of compensation of employees above a certain
salary level, the review of management recommendations relating to
incentive compensation plans, the administration of the Company's stock
option and restricted stock purchase plans, the review of compensation of
directors, and consultation with management and the Board on senior
executive continuity and organizational matters. Messrs. Hoover, Dalton,
and Deutsch comprise the members of the Compensation Committee. The
Compensation Committee held three meetings during fiscal 1996.
-5-
<PAGE>
DIRECTORS' COMPENSATION
The Company pays its outside directors a quarterly fee of $2,000 and
a fee of $1,000 for each Board or committee meeting attended, except that
no fee is paid for attendance at a committee meeting held on the same
date and in the same location as a Board meeting. The Company reimburses
all directors for their travel and other expenses incurred in connection
with attending Board or committee meetings and also reimburses its
outside directors for actual expenses otherwise incurred in performing
their duties.
-6-
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the total compensation paid or
accrued by the Company for services rendered during the fiscal year ended
June 30, 1996, to or for the Company's chief executive officer and each
of the Company's other four most highly compensated executive officers
(the "Named Executive Officers"):
Summary Compensation Table
</TABLE>
<TABLE>
<CAPTION>
Annual Compensation Long Term
------------------- Compensation
------------
Securities
Fiscal Other Annual Underlying All Other
Name and Principal Position Year Salary Compensation Bonus Options/SARs Compensation
- --------------------------- ------ ------ ------------ ----- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
George D. Shaunnessy, 1996 $250,011 $ 0 $ 0 417,243 $6,644 <F1>
President and Chief Executive Officer 1995 210,000 0 69,996 0 1,466
Peter J. Bibb, 1996 190,009 0 0 208,622 6,566 <F1>
Vice President and Chief Financial Officer 1995 160,006 0 53,330 0 1,847
Harold W. Small, 1996 165,006 $47,678<F2> 0 208,621 7,050 <F1><F4>
Vice President and Chief Operating Officer 1995 130,005 43,331 0 1,027
Thomas F. Luthringer, 1996 155,008 0 0 198,621 6,131 <F1><F4>
Vice President - Corporate Development 1995 130,005 0 43,331 0 616
J. Paul Gordon, 1996 157,729 0 0 45,000 3,852
Vice President - Strategic Development 1995 13,270 <F3> 0 0 0 325 <F1><F4>
<FN>
<F1> Includes premiums paid for each Named Executive Officer under the
Company's life insurance program.
<F2> Represents relocation expenses paid by the Company.
<F3> Mr. Gordon's employment by the Company commenced on May 31, 1995,
upon the Company's acquisition of Home Care Affiliates, Inc.
<F4> Includes $2,475, $2,415, and $3,823 paid by the Company as 401(k)
matching contributions for Mr. Small, Mr. Luthringer, and Mr. Gordon,
respectively.
</FN>
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
Option Grants in Last Fiscal Year
No. of % of Total Potential Realizable
Securities Options/SARs Value at Assumed
Underlying Granted to Annual Rates of Stock
Option/SARs Employees in Exercise or Expiration Price Appreciation
Granted<F1> Fiscal Year Base Price Date for Option Terms<F2>
----------- ------------- ----------- ---------- ----------------------
5% 10%
------- ---------
<S> <C> <C> <C> <C> <C> <C>
George D. Shaunnessy . . 90,000 21.00% $13.00 01/24/2006 $735,807 $1,864,679
Peter J. Bibb . . . . . . 45,000 10.50% 13.00 01/24/2006 367,903 932,339
Harold W. Small . . . . . 45,000 10.50% 13.00 01/24/2006 367,903 932,339
Thomas F. Luthringer . . 35,000 8.17% 13.00 01/24/2006 286,147 725,153
J. Paul Gordon . . . . . 5,000 1.17% 13.00 01/24/2006 40,878 103,593
_____________________________
<FN>
<F1> Beginning one year from date of grant, options vest in 20%
increments on anniversary of date of grant.
<F2> Based on assumed rates of stock price appreciations, as required by
the Commission.
</FN>
</TABLE>
<TABLE>
<CAPTION>
Fiscal Year-End Option Values
No. of Securities Underlying Value of Unexercised
Unexercised Options at In-the-Money Options
Fiscal Year End At Fiscal Year End<F1>
------------------------------ --------------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
George D. Shaunnessy . . . . . . . 98,173 319,070 $1,670,794 $4,595,659
Peter J. Bibb . . . . . . . . . . . 49,087 159,535 835,405 2,297,830
Harold W. Small . . . . . . . . . . 49,086 159,535 835,389 2,297,830
Thomas F. Luthringer . . . . . . . 49,086 149,535 835,389 2,236,530
J. Paul Gordon . . . . . . . . . . 8,000 37,000 121,040 514,810
__________________________
<FN>
<F1> As required by the rules of the Securities and Exchange Commission, the
value of unexercised in-the-money options is calculated based on the closing
sale price of the Company's Common Stock on The Nasdaq Stock Market
("Nasdaq") as of the last business day of its fiscal year, June 28, 1996,
which was $19 1/8 per share. Because the closing sale price of the
Company's Common Stock on Nasdaq as of October 24, 1996 was $4.00, the
value of unexercised in-the-money options as of that date was substantially
less.
</FN>
</TABLE>
-8-<PAGE>
EMPLOYMENT AGREEMENTS
The Company entered into amended and restated employment
agreements with Messrs. Shaunnessy, Bibb, Small, and Luthringer as
of January 1, 1996. The agreements provide for a term ending June
30, 1999, and are automatically extended thereafter for successive
one-year terms unless the Company or the officer gives at least
thirty days' prior notice of an election not to extend the
employment term beyond June 30, 1999, or on any subsequent June 30.
The Company also entered into an amended and restated employment
agreement with Mr. Gordon as of May 31, 1995. The agreement
provides for a term ending May 31, 1998, and is automatically
extended thereafter for successive one-year terms unless the Company
or Mr. Gordon gives at least ninety days' prior notice of an
election not to extend the employment term beyond May 31, 1998, or
any subsequent May 31.
The agreements provide for a base salary of $250,000, $190,000,
$165,000, $155,000 and $150,000, per year, subject to adjustment by
the Board of Directors, for Messrs. Shaunnessy, Bibb, Small,
Luthringer, and Gordon, respectively, an annual bonus as determined
by the Company's Board of Directors, and Company benefits of the
type generally provided to key executives. While the Company or the
officer may terminate his agreement at any time during the term, if
the Company terminates the agreement other than for cause, death or
disability, in the case of Messrs. Shaunnessy, Bibb, Small or
Luthringer, the Company must pay severance based on the officer's
base salary under the agreement for the twelve months following the
day of termination and a pro rata amount of any performance bonus to
which the officer would otherwise be entitled for the fiscal year in
which such termination occurs, and in the case of Mr. Gordon, a
severance amount equal to the lesser of his annual salary under the
agreement and the remaining amount of salary to which he would have
been entitled under the agreement absent termination. The agreements
contain fairly customary proscriptions against misuse of
confidential Company information, competition with the Company and
solicitation of employees of the Company.
STOCK OPTION AND RESTRICTED STOCK PLANS
In June 1994, the Company adopted the Stock Option and
Restricted Stock Purchase Plan (the "1994 Option Plan") and the
Performance Stock Option and Restricted Stock Purchase Plan (the
"Performance Plan"). In January 1996, the Company adopted the 1996
Stock Option and Restricted Stock Plan (the "1996 Option Plan")
(collectively, with the 1994 Option Plan and the Performance Plan,
the "Plans"). The purpose of the Plans is to provide key employees
(approximately 50 persons), executive officers (currently five
persons), and directors (currently six persons) an opportunity to
own Common Stock of the Company and to provide incentives for such
persons to promote the financial success of the Company. The
Company has reserved 945,000 shares, 272,202 shares, and 500,000
shares of Common Stock for issuance pursuant to the 1994 Option
Plan, the Performance Plan, and the 1996 Option Plan, respectively.
Awards granted under the Plans may be "incentive stock options", as
defined in Section 422 of the Internal Revenue Code, as amended
("IRC"), "nonqualified stock options", or shares of Common Stock
subject to terms and conditions set by the Board of Directors
("restricted stock awards"). Incentive stock options may be granted
only to full-time employees (including officers) of the Company or
its subsidiaries. Nonqualified options and restricted stock awards
may be granted to any person employed by or performing services for
the Company or its subsidiaries, including directors.
-9-<PAGE>
Incentive stock options are subject to certain limitations
prescribed by the Internal Revenue Code of 1986, as amended,
including the requirement that such options may not be granted to
employees who own more than 10% of the combined voting power of all
classes of voting stock (a "principal shareholder") of the Company,
unless the option price is at least 110% of the fair market value of
the Common Stock subject to the option. In addition, an incentive
stock option granted to a principal shareholder may not be
exercisable more than five years from its date of grant. The Board
of Directors of the Company (or a committee designated by the Board)
otherwise generally has discretion to set the terms and conditions
of options and restricted stock awards, including the term, exercise
price, and vesting conditions, if any, to select the persons who
receive such grants and awards; and to interpret and administer the
Plans. As of September 30, 1996, options to purchase 912,743 shares
272,702 shares, and 324,825 shares were outstanding under the 1994
Option Plan, the Performance Plan, and the 1996 Option Plan, respectively,
including the options set forth in the table below:
<TABLE>
<CAPTION>
Benefit of Plans
Name and Position Dollar Value ($)<F1> Number of Options
- ----------------- ------------------- -----------------
<S> <C> <C>
George D. Shaunnessy $763,567 417,243
Peter J. Bibb 381,784 208,622
Harold W. Small 381,783 208,621
Thomas F. Luthringer 381,783 198,621
J. Paul Gordon --- 45,000
Executive Group 1,908,917 1,078,107
Non-Executive Director Group 90,000 30,000
Non-Executive Officer 459,000 402,163
Employee Group
___________________________
<FN>
<F1> Aggregate market value as of October 24, 1996 of
outstanding options to purchase Common Stock,
based on the closing sale price of Common Stock on
Nasdaq as of that date, which was $4.00 per
share, less aggregate exercise price payable by
the optionee(s).
</FN>
</TABLE>
No restricted stock awards have been granted under the Plans.
-10-<PAGE>
CERTAIN TRANSACTIONS
GENERAL
Pursuant to the Company's redemption of its Series A
Preferred Stock in April 1996, the Company paid principal and
accrued dividends to Messrs. Shaunnessy, Bibb, Small and
Luthringer of approximately $45,000, $12,000, $51,000 and
$61,000, respectively.
In connection with the Company's acquisition of one of its
subsidiaries in May 1995, J. Paul Gordon, Vice President-
Strategic Planning of the Company, and his brother, Blair S.
Gordon, were each granted rights to purchase up to 100,000 shares
of Common Stock at an exercise price of $4.00 per share. The
Gordons exercised the rights in August 1995.
For certain other transactions with related parties, see
"Compensation Committee Interlocks and Insider Participation"
below.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Hoover, Dalton and Deutsch served as members of the
Company's Compensation Committee during the 1996 fiscal year.
While Mr. Hoover is Chairman of the Board, none is an officer or
former officer of the Company.
In April 1996, the Company redeemed all of its outstanding
Series A Preferred Stock. Pursuant to the redemption, the
Company paid principal and accrued dividends of approximately
$18.8 million to Welsh, Carson, Anderson & Stowe, VI, L.P.
("Welsh Carson"), a principal shareholder of the Company, the
general partners of Welsh Carson's general partner, and
affiliates of Welsh Carson. Messrs. Hoover and Paul, directors
of the Company, are general partners of the general partner of
Welsh Carson.
The Company, through its management services division,
provides management services for the hospital-based home health
agency of Monroe County Hospital ("Monroe"), Monroeville,
Alabama, managed by a subsidiary of Quorum Health Group, Inc.
("Quorum"), of which James E. Dalton, Jr., a director of the
Company, is President and Chief Executive Officer. Welsh Carson
is also a principal shareholder of Quorum. Pursuant to the
agreement, the Company provides management services for the
hospital-based home health agency of Monroe in consideration of a
payment by Monroe of a specified amount per reimbursed Medicare
home care visit. The term of the agreement is three years,
terminable by either party for cause upon ninety days' notice.
In September 1995, the Company entered into a management services
agreement with Midlands Community Hospital ("Midlands"),
Papillion, Nebraska, which is also owned and operated by Quorum.
The agreement was negotiated on an arms-length basis, and the
services to be provided by the Company are generally the same as
described for the agreement with Monroe. In consideration of
such services, Midlands pays the Company a specified amount for
each reimbursed Medicare visit. The term of the agreement is
three years, terminable without cause by either party on ninety
days' notice or "for cause" as defined, upon thirty days' notice.
In November 1995, the Company entered into a management services
-11-
<PAGE>
agreement with McAllen Heart Hospital ("McAllen"), owned by an
affiliate of Welsh Carson. The agreement, entered into on an
arms-length basis, contains substantially the same terms as the
agreement with Monroe, described above, except that the
agreements are automatically renewed for successive one year
terms unless terminated without cause by either party on ninety
days' notice or "for cause", as defined, on thirty days' notice.
In March 1995, a subsidiary of the Company entered into an
equipment sale and service agreement with Lincare, Inc.
("Lincare"), of which Howard R. Deutsch, a director of the
Company, is Executive Vice President and General Counsel.
Pursuant to the agreement, Lincare agrees to sell or rent oxygen
equipment to the subsidiary at the prices set forth in the
agreement, which was negotiated on an arms-length basis.
The revenues derived from the contracts with Monroe,
Midlands, McAllen, and Lincare are not material to the Company's
results of operations and the terms of such contracts are as
favorable to the Company as those that could have been obtained
at the same time for unaffiliated parties.
REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee has provided the following
report:
The compensation policies of the Company have been developed
to link the compensation of executive officers with the
development of enhanced value for the Company's shareholders.
Through the establishment of both short-term and long-term
incentive plans and the use of base salary and performance bonus
combinations, the Company seeks to align the financial interests
of its executive officers with those of its shareholders.
PHILOSOPHY AND COMPONENTS
In designing its compensation programs, the Company follows
its belief that compensation should reflect both the Company's
recent performance and the value created for shareholders, while
also supporting the broader business strategies and long-range
plans of the Company. In doing so, the compensation programs
reflect the following general characteristics:
* The Company's financial performance and, in particular, that
of the individual.
* An annual incentive arrangement that generates a portion of
compensation based on the achievement of specific
performance goals in relation to the Company's internal
budget and strategic initiatives, with superior
performance resulting in enhanced total compensation.
The Company's executive compensation is based upon the
components listed below, each of which is intended to serve the
overall compensation philosophy:
BASE SALARY. Base salary is intended to be set at a
level that approximates the competitive amounts paid to
executive officers of similar businesses in structure, size,
-12-
<PAGE>
and industry orientation. Competitive amounts are
determined informally through a review of published
compensation surveys and proxy statements of other
companies, including some, but not all, of the companies in
the peer group selected for purposes of the stock
performance graph set forth elsewhere in this Proxy
Statement. Each of the Company's five senior executive
officers have employment agreements that specify their
respective base salaries.
INCENTIVE COMPENSATION. In accordance with the
Company's philosophy of tying a substantial portion of the
overall compensation of its executive officers to the
achievement of specific performance goals, an incentive plan
is developed for the executive officers. The Company's
incentive plans are designed to reward superior performance
with total compensation above competitive levels. On the
other hand, if performance goals are not achieved and the
Company suffers as a result, compensation of affected
executive officers may fall below competitive levels.
STOCK OPTIONS. The Company periodically considers
awards to its executive officers of stock options granted
under the terms of its Stock Option Plans. Options are
awarded to selected executive officers and other persons in
recognition of outstanding contributions they may have made
(or are being motivated to make) to the Company's growth,
development, or financial performance. The awarding of
options is designed to encourage ownership of the Company's
Common Stock by its executive officers, thereby aligning
their personal interests with those of our shareholders.
The Compensation Committee reviews and determines the
compensation of the executive officers of the Company with this
philosophy on compensation as its basis. While promoting
initiative and providing incentives for superior performance on
behalf of the Company for the benefit of its shareholders, the
Compensation Committee also seeks to assure that the Company is
able to compete for and retain talented personnel who will lead
the Company in achieving levels of growth and financial
performance that will enhance shareholder value over the long-
term as well as short-term.
CEO COMPENSATION
Effective January 1, 1996, the Company entered into an
amended and restated employment agreement with Mr. Shaunnessy to
provide for his continued service as President and Chief
Executive Officer for a term that extends to June 30, 1999, and
is renewable for successive one-year terms thereafter unless
either party chooses not to renew. Details about that agreement
are provided under "Executive Compensation -- Employment
Agreements", above.
-13-
<PAGE>
The Compensation Committee believes that the compensation
terms of Mr. Shaunnessy's employment agreement are consistent
with and reflect the Company's executive compensation philosophy.
The base salary provided to Mr. Shaunnessy is consistent with
what the Compensation Committee believes is the norm in the
Company's industry, and the opportunities for bonus compensation
are tied to the Company's performance in terms of value to its
shareholders. Additionally, the options that have been granted
to Mr. Shaunnessy are subject to long-term vesting.
James B. Hoover * James E. Dalton, Jr. * Howard R. Deutsch
-14-
<PAGE>
STOCK PERFORMANCE GRAPH
Set forth below is a line graph comparing the percentage
change in the cumulative total shareholder return on the
Company's Common Stock against the cumulative total return of The
Nasdaq Stock Market (U.S.) and the cumulative total return for a
group of companies consisting of Apria Healthcare Group, Inc.,
American Homepatient, Inc., Home Health Corp. of America, Inc.,
Interim Services, Inc., LinCare Holdings, Inc., Olsten Corp.,
Pediatric Services of America, Inc., and Rotech Medical Corp.,
for the period commencing on April 4, 1996, the date that the
Company's Common Stock became publicly traded, and ended on
September 30, 1996.
<TABLE>
<CAPTION>
COMPARISON OF 6 MONTH CUMULATIVE TOTAL RETURN <F1>
[graph appears here]
Cumulative Total Return
---------------------------------
4/04/96 6/30/96 9/30/96
<S> <C> <C> <C>
Housecall Medical Resources, Inc. 100 120 33
Peer Group 100 101 83
NASDAQ-Stock Market - US 100 107 110
________________________________________
<FN>
<F1> Graph reflects $100 invested on April 4, 1996 and the reinvestment of any
dividends in (i) Company Common Stock, (ii) the common stocks of the
group of companies identified above that have been selected by the
Company as its peers, and (iii) the Nasdaq Stock Market (U.S. Companies)
index.
</FN>
</TABLE>
-15-
<PAGE>
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors, upon recommendation of the Audit
Committee, appoints each year the firm that will serve as the
Company's independent public accountants. The Board has
appointed Ernst & Young LLP, which firm served as independent
public accountants for the Company during the past fiscal year,
to serve as such accountants for the current fiscal year. Such
appointment is not subject to ratification or other vote by the
shareholders.
A representative of Ernst & Young is expected to be present
at the Annual Meeting, with the opportunity to make a statement
if he or she desires to do so, and is expected to be available to
respond to appropriate questions.
SHAREHOLDERS' PROPOSALS FOR 1997 ANNUAL MEETING
Any shareholder who wishes to present a proposal appropriate
for consideration at the Company's 1997 Annual Meeting of
Shareholders must submit the proposal in proper form to the
Company at its address set forth on the first page of this Proxy
Statement no later than July 1, 1997, in order for the proposal
to be considered for inclusion in the Company's proxy statement
and form of proxy relating to such Annual Meeting.
OTHER MATTERS
All of the expenses involved in preparing, assembling, and
mailing this Proxy Statement and the materials enclosed herewith
and soliciting proxies will be paid by the Company. It is
estimated that such costs will be nominal. The Company may
reimburse banks, brokerage firms and other custodians, nominees,
and fiduciaries for expenses reasonably incurred by them in
sending proxy materials to beneficial owners of stock. The
solicitation of proxies will be conducted primarily by mail but
may include telephone, telegraph, or oral communications by
directors, officers, or regular employees of the Company, acting
without special compensation.
The Board of Directors is aware of no other matters, except
for those incidental to the conduct of the Annual Meeting, that
are to be presented to shareholders for formal action at the
Annual Meeting. If, however, any other matters properly come
before the Annual Meeting or any postponement, adjournment, or
adjournments thereof, it is the intention of the persons named in
the proxy to vote the proxy in accordance with their judgment.
Shareholders are urged to fill in, date, and sign the
accompanying form of proxy and return it to the Company as soon
as possible.
BY ORDER OF THE BOARD OF
DIRECTORS,
Peter J. Bibb
SECRETARY
<PAGE>
HOUSECALL MEDICAL RESOURCES, INC.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 6, 1996
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, having received notice of the Annual Meeting of
Shareholders and revoking all prior proxies, hereby appoints George D.
Shaunnessy and Peter J. Bibb, and each of them, attorneys or attorney of
the undersigned, with full power of substitution in each of them, for and
in the name of the undersigned, to attend the Annual Meeting of
Shareholders of Housecall Medical Resources, Inc. (the "Company") to be
held Friday, December 6, 1996, at 1:00 P.M., Eastern Time, and any
postponement or adjournment thereof, and to vote and act upon the
following matters in respect of all shares of common stock of the Company
that the undersigned would be entitled to vote or act upon, with all
powers the undersigned would possess, if personally present:
1. ELECTION OF DIRECTORS:
To re-elect each of the following nominees, as a director of
the Company, for a term of one year:
George D. Shaunnessy James B. Hoover Howard R. Deutsch
James E. Dalton, Jr. Andrew M. Paul R. Dale Ross
/ / FOR / / WITHHOLD AUTHORITY
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR AN INDIVIDUAL
NOMINEE, WRITE HIS NAME BELOW. TO VOTE FOR OR WITHHOLD
AUTHORITY FOR ALL NOMINEES, MARK THE APPROPRIATE BOX.
--------------------------------------------------------------
2. TO VOTE, IN THE PROXIES' DISCRETION, UPON SUCH OTHER BUSINESS
AS MAY PROPERLY COME BEFORE THE MEETING OR ANY POSTPONEMENT OR
ADJOURNMENT THEREOF.
/ / AUTHORITY GRANTED / / AUTHORITY WITHHELD
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE.)
The shares represented by this proxy will be voted as directed by
the undersigned and as indicated herein. IF NO DIRECTION IS GIVEN WITH
RESPECT TO THE ELECTION OF DIRECTORS OR THE DISCRETIONARY AUTHORITY OF
THE PROXIES TO VOTE UPON OTHER PROPER BUSINESS, THIS PROXY WILL BE VOTED
FOR SUCH ELECTION, AND THE PROXIES, IN THEIR DISCRETION, WILL VOTE UPON
SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY
POSTPONEMENT OR ADJOURNMENT THEREOF.
Attendance of the undersigned at the meeting or any postponement or
adjournment thereof will not be deemed to revoke this proxy unless the
undersigned shall affirmatively indicate at such meeting the intention of
the undersigned to vote such shares in person.
Dated:______________________, 1996
BE SURE TO DATE THE PROXY
-----------------------------------
SIGNATURE
IF SHARES ARE HELD BY MORE THAN ONE OWNER,
EACH MUST SIGN. EXECUTORS, ADMINISTRATORS,
TRUSTEES, GUARDIANS, AND OTHERS SIGNING IN A
REPRESENTATIVE CAPACITY SHOULD GIVE THEIR
FULL TITLES.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
PLEASE SIGN ABOVE AND RETURN IN THE ENCLOSED POSTAGE PAID ENVELOPE
