<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] CONFIDENTIAL, FOR USE OF THE
[_] Preliminary Proxy Statement COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
RENAISSANCE WORLDWIDE, INC. (FORMERLY THE REGISTRY, INC.)
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
N/A
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 9-11.
(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 offset 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>
RENAISSANCE WORLDWIDE, INC.
189 WELLS AVENUE
NEWTON, MASSACHUSETTS 02159
April 28, 1998
To Our Stockholders:
You are cordially invited to attend our 1998 annual meeting of the
stockholders of Renaissance Worldwide, Inc., which will be held on May 28, 1998
at the offices of Ropes & Gray, One International Place, 36th Floor, Boston,
Massachusetts at 10:00 a.m. (Boston time). As you know, we recently changed our
fiscal year to a December year end and we wanted to have this meeting to line
up our annual meeting with the new calendar.
At this meeting you are being asked to elect one Class III director to serve
for a three-year term, to increase the number of shares of the Company's Common
Stock available for issuance under the Company's 1996 Stock Plan, to approve
amendments to the Company's 1996 Employee Stock Purchase Plan and to approve
the new 1998 Directors Stock Plan.
Please read the proxy statement, which describes the nominee for the Board of
Directors, the four proposals and presents other important information. When
you have finished reading the statement, please promptly mark, sign, and return
your proxy card in the enclosed envelope to ensure that your shares will be
represented.
We hope that many of you will be able to attend the meeting in person. I look
forward to seeing you there.
Sincerely yours,
/s/ G. Drew Conway
G. DREW CONWAY
President and Chief Executive
Officer
<PAGE>
RENAISSANCE WORLDWIDE, INC.
189 WELLS AVENUE
NEWTON, MASSACHUSETTS 02159
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 28, 1998
Notice is hereby given that the Annual Meeting of Stockholders of Renaissance
Worldwide, Inc. (the "Company") will be held at the offices of Ropes & Gray,
One International Place, 36th Floor, Boston, Massachusetts at 10:00 a.m.
(Eastern Standard Time), on Thursday, May 28, 1998 for the following purposes:
1.To elect one Class III director;
2. To approve an increase in the number of shares of common stock available
for issuance under the Company's 1996 Stock Plan;
3.To approve amendments to the Company's 1996 Employee Stock Purchase Plan;
4. To approve the adoption of the 1998 Directors Stock Plan; and
5.To transact any other business that may properly come before the meeting or
any adjournment(s) thereof.
Stockholders of record at the close of business on April 20, 1998 are
entitled to notice of and to vote at the meeting.
If you are unable to be present personally, please sign and date the enclosed
proxy and return it promptly in the enclosed envelope.
By Order of the Board of Directors
/s/ Richard L. Bugley
RICHARD L. BUGLEY
Clerk
Newton, Massachusetts
April 24, 1998
IT IS IMPORTANT THAT YOUR STOCK BE REPRESENTED AT THE MEETING. PLEASE SIGN
AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE WHETHER OR NOT YOU
PLAN TO ATTEND THE MEETING IN PERSON.
<PAGE>
RENAISSANCE WORLDWIDE, INC.
----------------
Annual Meeting of Stockholders
May 28, 1998
----------------
PROXY STATEMENT
VOTING AT THE ANNUAL MEETING
Voting by mail will in no way limit your right to vote at the Meeting if you
later decide to attend in person. If your shares are held in the name of a
bank, broker or other holder of record, you must obtain a proxy, executed in
your favor, from the holder of record to be able to vote at the Meeting.
All shares that have been properly voted and not revoked will be voted at the
Meeting in accordance with your instructions. If you sign your proxy card but
do not give voting instructions, the shares represented by that proxy will be
voted as recommended by the Board of Directors.
VOTING ON OTHER MATTERS
If any other matters are properly presented at the Meeting for consideration,
the persons named in the enclosed form of proxy will have the discretion to
vote on those matters for you. At the date this proxy statement went to press,
the Company did not know of any other matter to be raised at the Meeting.
REQUIRED VOTE
The presence, in person or by proxy, of the holders of a majority of the
votes entitled to be cast by the shareholders entitled to vote at the Meeting
is necessary to constitute a quorum. Abstentions and broker "non-votes" are
counted as present and entitled to vote for purposes of determining a quorum. A
broker "non-vote" occurs when a nominee holding shares for a beneficial owner
does not vote on a particular proposal because the nominee does not have
discretionary voting power for that particular item and has not received
instructions from the beneficial owner.
These proxy materials are delivered in connection with the solicitation by
the Board of Directors of Renaissance Worldwide, Inc. ("Renaissance" or
"Company") of proxies to be voted at our 1998 Annual Meeting of Shareholders
and at any adjournment or postponement.
You are invited to attend our Annual Meeting on May 28, 1998, beginning at
10:00 a.m. The Meeting will be held at the offices of Ropes & Gray, One
International Place, Boston, Massachusetts.
This Proxy Statement, form of proxy and the Company's 1997 transition annual
report are being mailed starting April 28, 1998.
SHAREHOLDERS ENTITLED TO VOTE
Holders of record of Renaissance Common Stock at the close of business on
April 20, 1998 are entitled to receive this notice and to vote their shares at
the Meeting. As of that date, there were 55,796,624 shares of Common Stock
outstanding. Each share is entitled to one vote on each matter properly brought
before the Meeting including the four proposals set forth in the Proxy
Statement.
PROXIES
Your vote is important. Shareholders of record may vote their proxies by
mail. If you choose to vote by mail, simply mark your proxy, date and sign it,
and return it in the postage-paid envelope provided.
Proxies may be revoked at any time before they are exercised by (1) written
notice to the Clerk of the Company, (2) timely delivery of a valid, later-dated
proxy or (3) voting by ballot at the Meeting.
<PAGE>
A plurality of the votes is required for the election of the Class III
Director. Abstentions and broker "non-votes" are not counted for purposes of
the election of directors and have no effect on the outcome.
The approval of each of Proposals 2, 3 and 4 require the affirmative vote of
a majority of the shares present or represented by proxy and entitled to vote.
Abstentions will have the effect of votes against these proposals and broker
"non-votes" will have no effect on these proposals.
COST OF PROXY SOLICITATION
The Company will pay the expenses of soliciting proxies. Proxies may be
solicited by directors, officers or employees in person or by telephone,
electronic transmission, facsimile transmission or by telegram. The Company
will reimburse brokers and other persons for their reasonable charges and
expenses in forwarding soliciting materials to their principals.
PROPOSAL NUMBER 1
ELECTION OF CLASS III DIRECTOR
The Company's Board of Directors is divided into three classes, as nearly
equal in number as possible, so that each class will serve for three years,
with one class of directors being elected each year.
The nominee is G. Drew Conway, the sole Director currently designated as a
Class III director, whose term expires at the Meeting. If elected, he would
serve for a term of three years expiring at the 2001 Annual Meeting and until
his successor is elected. The Company expects that Mr. Conway will be able to
serve, but if he is unable to serve, the proxies reserve discretion to vote, or
refrain from voting, for a substitute nominee.
The persons named in the enclosed proxy intend to vote the proxy in favor of
the election of G. Drew Conway as a Class III director, unless the proxy card
indicates that authority to vote for his election is withheld.
NOMINEES
G. Drew Conway is the founder of the Company and has served as its President,
Chief Executive Officer and Director since its incorporation in May 1986. From
1983 until 1986, Mr. Conway was a founder and principal of The Experts, a
technical staffing company. Mr. Conway is 40 years old.
OTHER DIRECTORS
Robert E. Badavas, a Class I Director, became a director of the Company in
May 1996. Mr. Badavas has been President and Chief Executive Officer of
Cerulean Technology, Inc., a provider of mobile information systems
applications, since December 1995. From October 1986 through October 1995, Mr.
Badavas was employed by Chipcom Corporation, a manufacturer of computer
networking intelligent switching systems, where he served as Senior Vice
President, Finance, from July 1994 to October 1995, Vice President, Finance,
from October 1986 to July 1994 and Chief Financial Officer and Treasurer from
October 1986 to October 1995. Mr. Badavas is 45 years old.
Terry L. Hunter, a Class I Director, became a director of the Company in
April 1998. Mr. Hunter has served as President, Chief Executive Officer and a
Director of The Hunter Group, Inc. since its formation in 1983. Prior to
founding The Hunter Group, Mr. Hunter consulted with various companies and
software vendors on the design and development of human resources systems. Mr.
Hunter is 51 years old.
Paul C. O'Brien, a Class II Director, became a director of the Company in
April 1996. Mr. O'Brien is the President of The O'Brien Group, Inc., a
consulting firm in the areas of community relations
-2-
<PAGE>
and external affairs that he founded in January 1995. Before founding The
O'Brien Group, Mr. O'Brien was employed by New England Telephone and Telegraph
Company, most recently as Chairman of the Board from 1993 to December 1994 and
as President and Chief Executive Officer from 1988 to 1993. Mr. O'Brien is also
a director of BankBoston Corp., Cambridge NeuroScience, Inc., First Pacific
Networks Inc., Shiva Corporation and is Chairman of the Board of View Tech,
Inc. Mr. O'Brien is 58 years old.
BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors held four meetings during the twelve months ended
December 27, 1997. Each director attended at least 75% of the Board meetings
held during this period. The Board of Directors currently has two standing
committees, the Audit Committee and the Compensation Committee. The Board of
Directors does not have a Nominating Committee or a committee performing
similar functions.
The Audit Committee and the Compensation Committee are composed of Messrs.
Badavas and O'Brien. The Audit Committee held two meetings during the twelve
months ended December 27, 1997. The Audit Committee has the responsibility of
recommending to the Board of Directors the independent auditors to be engaged
by the Company, reviewing with management and with the independent auditors the
Company's internal accounting procedures and controls and reviewing with the
independent auditors the scope and results of their audit. The Compensation
Committee held one meeting during the twelve months ended December 27, 1997.
The Compensation Committee has the responsibility of providing recommendations
to the Board regarding compensation matters and administering the Company's
stock option and stock purchase plans.
DIRECTOR COMPENSATION
During 1997, directors who were not officers or employees of the Company were
paid $1,000 for each Board meeting attended and an annual fee of $1,000 for
each membership on a committee of the Board. In addition, under the Company's
1996 Eligible Directors' Stock Plan, each director who was not an officer,
employee or consultant of the Company or any subsidiary of the Company (an
"outside director") was granted, upon first being elected to the Board of
Directors, an option to purchase 40,000 shares of Common Stock at an exercise
price equal to the fair market value on the date of the grant. At December 27,
1997 a total of 120,000 shares of Common Stock remained available for awards
under that Plan.
Beginning in 1998, the Board of Directors instituted a new compensation
arrangement for outside directors. Each outside director now receives an annual
retainer of $12,000 per year for service on the Board. If stockholders approve
the 1998 Directors Stock Plan presented in Proposal 4, one half of that
retainer will be paid in stock options having a fair value equal to one half of
the retainer amount. Each outside director will also be entitled to elect to
have all or any portion of the balance of the annual retainer paid in an
equivalent value of stock options. In addition, outside directors will receive
each year an option grant covering 2,500 shares. Because Messrs. Badavas and
O'Brien have been serving for approximately two years without receiving an
annual equity award, each of them will receive an option to purchase 5,000
shares on the date that the Directors Stock Plan is approved by stockholders.
If the Directors Stock Plan is approved, it will replace the 1996 Eligible
Directors' Stock Plan. For more information on the Directors Stock Plan, see
"Proposal 4--Approval of 1998 Directors Stock Plan."
THE BOARD OF DIRECTORS RECOMMENDS ELECTION
OF THE NOMINEE DESCRIBED IN PROPOSAL NUMBER 1.
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<PAGE>
PROPOSAL NUMBER 2
AMENDMENT TO THE 1996 STOCK PLAN
On April 21, 1998, the Board of Directors approved, subject to stockholder
approval, an amendment (the "Amendment") to the 1996 Stock Plan (the "Plan").
The Amendment increases the number of shares of Common Stock available for
awards under the Plan and sets an overall limit on the number of options that
can be awarded as incentive stock options under the Internal Revenue Code (the
"Code").
DESCRIPTION OF THE AMENDMENT
As of December 27, 1997, stockholders had authorized a total of 7,200,000
shares of Common Stock for awards under the Plan. On that date, approximately
853,036 shares remained available for award. The shares currently available
will not satisfy the Company's needs for equity compensation. The Company is in
an industry where there is intense competition for talented consultants, and
the Board believes it is necessary to be able to offer equity compensation to
attract and retain talented professionals. In addition, because of the
Company's rapid growth, choosing a fixed number of shares by which to increase
the share reserve may not be sufficient to accommodate the growth in personnel.
The Board has decided to provide that for a three-year period the shares
available under the Plan will be increased each year by a number of shares
equal to four percent (4%) of the total outstanding shares at the beginning of
each year. For 1998, that increase would be equal to 4% of the shares
outstanding on the date of the Meeting. On April 20, 1998, the record date for
the Meeting, there were 55,796,624 shares outstanding. If that number of shares
is outstanding on the date of the Meeting, shares 2,231,864 would be authorized
for this year. Any shares authorized but not used in one year would be
available for awards in future years.
PLAN ADMINISTRATION
The Plan is administered by the Company's Compensation Committee. Under the
Plan, the Committee may grant stock options (both incentive stock options and
nonstatutory options) and authorizations to purchase Common Stock ("purchase
authorizations") and bonus awards of Common Stock ("bonuses") to employees of
the Company and its subsidiaries and other persons or entities who, in its
opinion, are in a position to make a significant contribution to the success of
the Company. On December 27, 1997 the Company had approximately 4,500
employees, all of whom were eligible for awards under the Plan.
The Committee determines the exercise price of options, which for an
incentive stock option ("ISO") may not be less that 100% and for a nonstatutory
option not less than 85% of the fair market value of the Common Stock at the
time of grant. The Committee sets the term of each option, which generally
cannot exceed ten years from grant. The exercise price may be paid in cash or
check or, if the Committee approves, by tendering shares of Common Stock, by
using a recourse promissory note, or in a "cashless" exercise through a broker.
Purchase authorizations generally give the participant a right to acquire a
fixed number of shares of Common Stock at a fixed purchase price of not less
than 85% of the fair market value at the time of grant. They differ from
options because the period of time during which they may be exercised is
generally short. Bonuses are awards made to participants in shares of Common
Stock in consideration of services previously rendered.
In order for awards under the Plan to qualify as performance-based for
purposes of Section 162(m) under the Code, the Plan must include a limit on the
number of options awarded to a single participant. The Plan provides that no
participant may receive options covering more than 200,000 shares in any one
year. In addition, to comply with the rules relating to ISOs, the Plan provides
that the number of shares awarded subject to ISOs may not exceed 15,000,000.
If the Common Stock changes as a result of a merger or similar reorganization
in which the Company is the surviving corporation, the number and kind of
shares available under the Plan, the number and kind of shares then subject to
options or purchase authorizations shall be appropriately adjusted in such
manner as the Committee may
-4-
<PAGE>
determine equitable to prevent dilution or enlargement of the rights available
or granted hereunder. In the case of certain mergers, consolidations or other
transactions in which Renaissance is acquired or liquidated, or its assets are
sold, all outstanding awards will terminate unless a successor entity agrees to
assume the awards. Prior to such termination, however, the Committee may
provide that all outstanding awards will become exercisable, in whole or in
part.
The Board may discontinue granting awards under the Plan at any time. The
Board may also amend the Plan for any purpose permitted by law, but no
amendment may adversely affect the rights of any participant under any award
previously granted.
TAX EFFECTS
The following discussion of certain federal income tax consequences
associated with participation in the plan is based on the law currently in
effect. It does not purport to cover federal employment tax or other federal
tax consequences that may be associated with the Plan nor does it cover state,
local or non-U.S. taxes.
An optionee realizes no ordinary taxable income upon the grant or exercise of
an ISO. Following the exercise, if the optionee does not dispose of the shares
acquired within two years from the date of grant or within one year after the
exercise, then upon sale of such shares, any amount realized in excess of the
amount paid for the shares will be long-term capital gain and any loss allowed
for tax purposes will be long-term capital loss. No deduction will be allowed
to the Company. The exercise of an ISO will, however, increase the optionee's
alternative minimum taxable income and may result in alternative minimum tax
liability.
If the optionee disposes of shares acquired upon the exercise of an ISO prior
to the expiration of the two-year or one-year holding periods described above
(a "disqualifying disposition"), generally (a) the optionee will realize
ordinary income in the year of disposition in an amount equal to the excess (if
any) of the fair market value of the shares at exercise (or, if less, the
amount realized on a sale of such shares) over the amount paid for the shares,
and (b) the Company will be entitled to deduct this amount. Any further gain
recognized will be taxed as short-term or long-term capital gain and will not
result in any deduction by the Company. Special rules may apply where all or a
portion of the exercise price of the ISO is paid by tendering shares of
Renaissance Common Stock. A disqualifying disposition will eliminate the
alternative minimum taxable income adjustment associated with the exercise of
the ISO if it occurs in the same calendar year as the year in which the
adjustment occurred.
If an ISO is exercised at a time when it no longer qualifies for the tax
treatment described above, the option is treated as a nonstatutory option.
Generally, an ISO will not be eligible for the tax treatment described above if
it is exercised more than three months following termination of employment (one
year following termination of employment, in the case of termination by reason
of permanent and total disability), except in certain cases where the ISO is
exercised after the death of the optionee. Options otherwise qualifying as ISOs
will also be treated for federal income tax purposes as nonstatutory options to
the extent they (together with other ISOs held by the optionee) first become
exercisable in any calendar year for shares having a fair market value
determined at the time of the option grant, exceeding $100,000.
With respect to nonstatutory options under the Plan, no income is realized by
the optionee at the time the option is granted. Generally, at exercise, an
optionee realizes ordinary income, subject (in the case of options granted to
an employee) to withholding, in an amount equal to the difference between the
option price and the fair market value of the shares on the date of exercise,
and a corresponding deduction will be available to the Company. Any gain or
loss recognized upon a later sale is treated as capital gain or loss, either
short-term or long-term depending on the applicable holding period for the
sale.
Section 162(m) of the Code limits to $1 million the deduction a public
corporation may claim for remuneration paid to any of its five top officers,
subject to a number of exceptions and special rules. Eligible performance-based
compensation is exempt from this limit. The Company intends that compensation
associated with the exercise of options and purchase authorizations awarded
under the Plan will qualify for this performance-based exemption.
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<PAGE>
The Code also limits the amount of compensation that may be paid without
penalty in connection with a change in control. In general, if the total of an
individual's change-in-control related compensation equals or exceeds three
times his or her average annual taxable compensation (determined, in general,
over the five calendar year period preceding the calendar year in which the
change in control occurs), change-in-control related payments in excess of that
annual average are nondeductible to the Company and subject to an additional
20% tax on the recipient. In making this determination, some portion or all of
the value of options and other awards granted or accelerated in connection with
a change in control may be required to be taken into account.
OTHER PLANS
In addition to the stock plans described in this Proxy Statement, the Company
maintains one stock plan for use exclusively for options awarded to employees
of acquired businesses and one stock plan for use exclusively in foreign
jurisdictions. These plans are not subject to stockholder approval, and no
officers or directors of the Company are eligible to receive awards under
either plan. A total of 1,000,000 shares has been reserved for issuance under
these two plans.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT STOCKHOLDERS VOTE FOR PROPOSAL NUMBER 2
PROPOSAL NUMBER 3
AMENDMENT TO 1996 EMPLOYEE STOCK PURCHASE PLAN
On April 21, 1998, the Board of Directors approved, subject to stockholder
approval, an amendment to the 1996 Employee Stock Purchase Plan (the "Purchase
Plan") to provide the Company flexibility in choosing which of its subsidiaries
will participate in the Purchase Plan. At present, all subsidiaries of the
Company participate in the Purchase Plan. The Company has found, however, that
particularly as it has acquired subsidiaries in foreign countries the benefits
under the Purchase Plan are not the same in all jurisdictions. In addition,
regulatory considerations in foreign jurisdictions can make compliance costly.
Accordingly, the Board of Directors believes that it is preferable to give the
Company flexibility in choosing which subsidiaries will participate in the
Purchase Plan.
PLAN ADMINISTRATION
The Purchase Plan is designed to enable eligible employees to purchase shares
of Common Stock at a discount through payroll deductions. All employees other
than employees owning 5% or more of the Common Stock are eligible to
participate in any option period commencing after the date the employee is
hired by the Company or its subsidiaries. As of December 27, 1997, there were
approximately 365 employees enrolled in the Purchase Plan.
Purchases occur twice a year at the end of six-month option periods which
begin on January 1 and July 1. The purchase price for Common Stock under the
Purchase Plan is 85% of the lesser of the fair market value of the Common Stock
at the beginning of the option period and the fair market value of the Common
Stock at the end of the option period. On April 20, 1998 the last reported sale
price for the Common Stock as reported on the Nasdaq National Market was $26.50
per share. The Purchase Plan permits eligible employees to purchase up to
200 shares of Common Stock in any six-month offering period through payroll
deductions, which may not be less than 1% nor exceed 10% of an employee's
compensation. The 1996 Purchase Plan terminates on March 29, 2006.
If a participant's employment with the Company terminates during the first
three-month period in an option period, the participant's option to purchase
shares for that period will be deemed canceled and the balance of the
participant's payroll withholding account will be refunded. If a participant's
employment with the Company terminates during any time after the first three-
month period within a period, the option shall remain outstanding under the
Purchase Plan unless the participant otherwise withdraws.
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<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
The following discussion of certain federal income tax consequences
associated with participation in the Purchase Plan is based on the law as
currently in effect. It does not purport to cover federal employment tax or
other federal tax consequences that may be associated with the Purchase Plan,
nor does it cover state, local or non-U.S. taxes.
Under the Purchase Plan, a participant does not realize income either upon
the grant of an option at the beginning of an option period or upon the
exercise of the option at the end of that period. If shares of Common Stock
acquired upon exercise are disposed of within two years from the date of grant
of the option, the participant realizes ordinary income at the time of
disposition equal in general to the excess of the fair market value of the
shares on the measurement date over the exercise price. The Company is entitled
to a corresponding deduction. If shares acquired upon exercise are disposed of
after the two-year period described above, or if the participant dies at any
time while holding the shares, ordinary income is realized in an amount equal
to the lesser of (i) 15% of the fair market value of the shares at the time the
option was granted, or (ii) the excess of the fair market value of the shares
at the time of disposition (or death) over the exercise price. In addition, a
capital gain will be recognized on the excess, if any, of the amount recognized
on a sale over the employee's basis (the amount paid per share plus the
ordinary income recognized as a result of the sale). No deduction is available
to the Company for this amount.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
STOCKHOLDERS VOTE FOR PROPOSAL NUMBER 3.
Although the benefits under the Purchase Plan depend on a participant's
chosen level of participation and are therefore not determinable, set forth in
the table below is the number of shares of Common Stock acquired under the
Purchase Plan during 1997 by (i) each of the Named Executive Officers (as
defined below), (ii) all executive officers as a group and (iii) all employees,
including all officers who are not executive officers, as a group. Directors
who are not employees are not entitled to participate in the Purchase Plan.
NEW PLAN BENEFITS
PURCHASE PLAN
<TABLE>
<CAPTION>
NAME SHARES PURCHASED PURCHASE PRICE
---- ---------------- --------------
<S> <C> <C>
G. Drew Conway
President, Chief Executive Officer and
Director -- --
Robert E. Foley
Chief Financial Officer and Treasurer 400 $ 7.23
302 $19.55
Richard L. Bugley
Vice President, General Counsel and
Clerk -- --
David Lubin
Managing Director, Renaissance
Solutions, Inc. -- --
All Executive Officers as a Group 702 $12.53
Non-Executive Officer Employee Group 101,986 $12.81
</TABLE>
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<PAGE>
PROPOSAL NUMBER 4
ADOPTION OF THE 1998 DIRECTORS STOCK PLAN
On April 21, 1998, the Board adopted, subject to stockholder approval, the
1998 Directors Stock Plan (the "Directors Plan"). Under the Directors Plan,
outside directors of the Company will receive equity compensation in three
ways. Upon joining the Board, an outside director will receive an option
covering 20,000 shares of Common Stock. This option will become exercisable in
four annual installments beginning one year from the date of grant. Outside
directors will also receive an option covering 2,500 shares of Common Stock
after each year of service. This award, which represents compensation for
service during the previous year, will be immediately exercisable. Finally,
each outside director will be required to take one half of the annual retainer
(currently $12,000) in options having an equivalent value and may elect to take
all or a portion of the balance in options as well.
Because Messrs. Badavas and O'Brien have served for two years without annual
equity awards, if the Directors Plan is approved at the Meeting, they will each
receive an immediately exercisable option covering 5,000 shares.
CURRENT ARRANGEMENTS
Currently, outside directors who join the Board receive an option for 40,000
shares and meeting fees equal to $1,000 per meeting. The Board examined these
arrangements and found that the one-time award appeared to be higher than in
comparable companies, but that the annual compensation was below that of
comparable companies and lacked any equity component. It decided to reduce the
size of the one-time award, institute a small equity annual award and provide
for an annual retainer one half of which must be taken in the form of options.
The Board believes that this compensation system will help attract and retain
qualified outside directors.
This new arrangement replaces the existing 1996 Eligible Directors' Stock
Plan. The shares reserved under that plan (120,000 at December 27, 1997) are
being transferred to the Directors Plan, and no new authorization from
stockholders is being sought.
GENERAL
All directors who are not employees of the Company or any of its subsidiaries
("Eligible Directors") participate in the Directors Plan. There are currently
two Eligible Directors. Under the Directors Plan, which is administered by the
Board, each Eligible Director will receive an option covering 20,000 shares
upon first joining the Board. This option will vest in four annual installments
commencing on the first anniversary of the grant date. In addition, beginning
in 1999, each year at the annual meeting of stockholders, each Eligible
Director will receive an immediately exercisable option covering 2,500 shares
for service during the previous year.
The Directors Plan also provides for equity compensation in lieu of the
annual cash retainer. On the first day of each "Plan Year," which is defined as
the period from the date of one Annual Stockholders Meeting (an "Annual
Meeting") through the next Annual Meeting, as determined from time to time by
the Board, each Eligible Director will receive one half of the annual retainer
for the Plan Year in the form of options. In addition, each Eligible Director
may elect to take all or any portion of the balance of the annual retainer in
the form of options. These options become exercisable in full on the date of
the next succeeding Annual Meeting.
The number of shares underlying these options will be equal to the whole
number (with any fractional interests rounded up to the next highest whole
number) obtained by dividing the dollar value of the mandatory and elective
portions of the annual retainer by the per share value of the option on the
grant date. To determine the per share value of the option, the Board will
apply a generally accepted option valuation methodology, such as the Black-
Scholes model, with such modifications as it may determine are appropriate to
reflect the fair value of the option.
The exercise price of each option granted under the Directors Plan will be
100% of the fair market value of the Common Stock on the grant date. The
-8-
<PAGE>
exercise price may be paid in cash, by check, with shares of Common Stock or by
the delivery of an irrevocable undertaking by a broker to pay the exercise
price from the proceeds of the sale of the shares subject to the option being
exercised. Each option will be nontransferable except upon death, pursuant to a
qualified domestic relations order or to a member of the optionee's immediate
family or to a trust or other entity, the sole beneficiaries of which are the
optionee or members of his immediate family. Each option expires ten years
after the date of grant. If the director ceases to be a director of the Company
for any reason other than death, permanent disability, resignation or
retirement, the director's option shall expire and all rights to purchase
shares pursuant thereto shall terminate immediately. If the director ceases to
be a director of the Company by reason of death, permanent disability,
resignation or retirement, the director's options that are then exercisable may
thereafter be exercised for a period of one year from the date of termination,
or until the expiration of the stated term of the option, if earlier. If an
option is canceled or expires without having been exercised, the number of
shares subject to the option will become available again for award under the
Directors Plan.
Upon a merger in which the Company is not the surviving corporation or that
results in the acquisition of all of the Company's stock or sale of all or
substantially all of the Company's assets, or a dissolution or liquidation of
the Company, all options that are not exercisable at that time will become
exercisable 20 days prior to the effective date of such transaction, and will
terminate upon the consummation of the transaction. If the transaction is
intended to qualify as a pooling of interests for accounting purposes, then the
acquiring or surviving corporation shall assume, or otherwise provide
replacement options for, all options outstanding under Directors Plan. These
options will otherwise be on terms and conditions substantially equivalent to
those set forth in the Directors Plan, will be immediately exercisable and,
except as to Eligible Directors who become directors of the acquiring or
surviving corporation, will terminate on the 180th day after the merger or
consolidation. A total of 120,000 shares of Common Stock--the amount that
remained available under the 1996 Eligible Directors' Stock Plan--has been
reserved for issuance under the Plan, plus the number of shares that may be
issued pursuant to options awarded in lieu of the annual retainer.
FEDERAL INCOME TAX CONSEQUENCES
The federal tax effects of the options are the same as for nonstatutory
options granted to employees under the 1996 Stock Option Plan, which are
described at pages 5 and 6 above.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEM 4.
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of Renaissance Common Stock as of April 7, 1998 by (i)
each person who is known to the Company to beneficially own more than 5% of the
outstanding shares of Common Stock, (ii) each of the Chief Executive Officer
and the three other most highly paid executive officers of the Company in the
twelve months ended December 27, 1997 (collectively, the "Named Executive
Officers") and each director of the Company, and (iii) all executive officers
and directors of the Company as a group. Except as otherwise indicated, each of
the stockholders named below has sole voting and investment power with respect
to the shares of Common Stock beneficially owned.
<TABLE>
<CAPTION>
SHARES PERCENTAGE OF
NAME OF DIRECTORS, NAMED EXECUTIVE BENEFICIALLY OUTSTANDING
OFFICERS AND 5% STOCKHOLDERS OWNED(1) SHARES
---------------------------------- ------------ -------------
<S> <C> <C>
G. Drew Conway(2)(3) 13,677,760 24.5%
Robert P. Badavas(4) 30,000 *
Paul C. O'Brien(4) 30,000 *
Terry L. Hunter 5,972,580 10.7%
David Lubin 675,876 1.2%
Robert E. Foley(5) 39,650 *
Richard L. Bugley(6) 24,000 *
Putnam Investments, Inc.(7) 5,932,144 10.6%
Dresdner Bank(8) 4,697,000 8.4%
All directors and executive officers
as a group(7 persons) 20,449,866 36.7%
</TABLE>
- ------------
* Less than one percent
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission ("SEC") and includes voting or
investment power with respect to the shares. Shares of Common Stock subject
to options currently exercisable or exercisable within 60 days are deemed
outstanding for determining the share ownership and percentage of the
person holding such options, but are not deemed outstanding for determining
the percentage of any other person.
(2) Mr. Conway's address is c/o Renaissance Worldwide, 189 Wells Avenue,
Newton, MA 02159.
(3) Includes (i) 5,340 shares of Common Stock held by trusts for the benefit of
Mr. Conway's children for which Mr. Conway serves as trustee, as to which
Mr. Conway disclaims beneficial ownership and (ii) 168,000 shares of Common
Stock held by the Conway Family Foundation, Inc. as to which Mr. Conway
disclaims beneficial ownership.
(4) Includes 20,000 shares of Common Stock issuable upon the exercise of
options currently exercisable or exercisable with 60 days.
(5) Includes 10,000 shares of Common Stock issuable upon the exercise of
options currently exercisable or exercisable with 60 days.
(6) Includes 23,800 shares of Common Stock issuable upon the exercise of
options currently exercisable or exercisable with 60 days.
(7) The information reported is based on a Schedule 13G, dated February 5,
1998, filed with the Commission by Putnam Investments, Inc. ("PI"), Marsh &
McLennan Companies, Inc. ("MMC"), Putnam Investment Management, Inc.
("PIM") and The Putnam Advisory Company, Inc. ("PAC"). PI is a registered
investment advisor, in which capacity it advises PIM and PAC and has shared
voting power with respect to 474,836 shares and shared dispositive power
with respect to 5,932,144 shares. PIM has shared dispositive power with
respect to 5,367,708 shares. PAC has shared voting power with respect to
474,836 shares and shared dispositive power with respect to 564,436 shares.
MMC is the parent holding company of PI. PI and MMC disclaim beneficial
ownership of such shares. PI's address is One Post Office Square, Boston,
MA 02109.
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<PAGE>
(8) The information reported is based on a Schedule 13G, dated January 30,
1998, filed with the Commission by Dresdner RCM Global Investors LLC
("Dresdner"), RCM Limited L.P. ("Limited") and RCM General Corporation
("General"). Dresdner is a registered investment advisor, Limited is the
managing agent of Dresdner and General is the general partner of Limited.
Limited and General disclaim beneficial ownership of the shares. Dresdner's
address is Four Embarcadero Center, San Francisco, California 94111.
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding all compensation
awarded to, earned by or paid to by the Company's President and Chief Executive
Officer and each of the Named Executive Officers during fiscal 1996 and 1997
and the 12 months ended December 27, 1997:
SUMMARY COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
COMPENSATION(2) COMPENSATION
------------------ ------------
SECURITIES
UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS
- --------------------------- --------------- --------- -------- ------------
<S> <C> <C> <C> <C>
G. Drew Conway 12-month period
President and Chief Executive ended 12/27/97 $399,984 $ -- --
Officer 1997 402,292 -- --
1996 520,000 -- --
Robert E. Foley 12-month period
Chief Financial Officer and ended 12/27/97 198,934 25,000 50,000
Treasurer 1997 191,246 30,000 50,000
1996 134,992 50,000 100,000
David Lubin 12-month period
Managing Director, Renaissance ended 12/27/97 375,000 -- --
Solutions 1997 375,000 -- --
1996 387,500 -- --
Richard L. Bugley 12-month period
Vice President, General ended 12/27/97 153,642 35,000 100,000
Counsel & 1997 132,300 20,000 55,000
Clerk 1996 15,000 -- 10,000
</TABLE>
- ------------
(1) The periods set forth with respect to each individual set forth in the
table are for the 12-month period ended December 27, 1997, for the fiscal
year ended the last Saturday in June 1997 and for the fiscal year ended the
last Saturday in June 1996. There is an overlap of approximately six months
with respect to the 12-month period ended December 27, 1997 and the fiscal
year ended the last Saturday of June 1997 for each of the individuals set
forth in the table.
(2) Annual compensation amounts does not include the dollar value of
perquisites and other personal benefits which did not exceed the lesser of
$50,000 or 10% of salary and bonus for any Named Executive Officer.
EMPLOYMENT AGREEMENTS
In connection with its initial public offering, the Company entered into an
employment agreement (the "Employment Agreement") with Mr. Conway pursuant to
which Mr. Conway will be employed as President and Chief Executive Officer of
the Company. The Employment Agreement provides for a term of four years and an
annual base salary of $400,000, $425,000, $475,000 and $525,000 in the first
through fourth years of the term. Mr. Conway is also eligible for a bonus based
on performance criteria pre-established by the Compensation Committee for each
year and subject to a maximum limitation of $160,000 in the first year. The
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<PAGE>
Employment Agreement provides that if Mr. Conway's employment is terminated
without "cause" (as defined in the Agreement) or if Mr. Conway terminates his
employment for "good reason" (as defined in the Agreement), the Company will
pay Mr. Conway severance equal to two years of base compensation plus a portion
of the bonus paid or payable with respect to the immediately preceding full
employment year based on days of service in the year of termination. In
addition, if Mr. Conway's employment is terminated at the end of the term of
the Employment Agreement, he will be entitled to severance equal to one year of
base compensation. The agreement also contains non-competition and non-
solicitation covenants during the employment term and for a two-year period
thereafter.
The following table sets forth certain information concerning grants of stock
options made during the 12 months ended December 27, 1997 to each of the Named
Executive Officers:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------
POTENTIAL REALIZABLE VALUE
NUMBER OF % OF AT ASSUMED ANNUAL RATES
SECURITIES TOTAL OPTIONS OF STOCK PRICE APPRECIATION
UNDERLYING GRANTED TO EXERCISE FOR OPTION TERMS(2)
OPTIONS EMPLOYEES IN OR BASE EXPIRATION ---------------------------
NAME GRANTED(#)(1) FISCAL YEAR ($/SH) DATE 5% 10%
---- ------------- ------------- -------- ---------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
G. Drew Conway -- -- -- -- -- --
Robert E. Foley 50,000 0.8% $17.50 4/1/07 $ 550,283 $ 1,394,525
Richard L. Bugley 55,000 0.8% $17.50 4/1/07 $ 605,311 $ 1,533,977
45,000 0.7% $21.88 11/3/07 $ 619,068 $ 1,568,840
David Lubin -- -- -- -- -- --
</TABLE>
- ------------
(1) The expiration date of each option is the tenth anniversary of the date on
which it was originally granted. These options are exercisable in five
annual installments commencing on April 1, 1998.
(2) The amounts shown on this table represent hypothetical gains that could be
achieved for the respective options if exercised at the end of the option
term. These gains are based on assumed rates of stock appreciation of 5%
and 10%, compounded annually from the date the respective options were
granted to their expiration date. The gains shown are net of the option
exercise price, but do not include deductions for taxes or other expenses
associated with the exercise. Actual gains, if any, on stock option
exercises will depend on the future performance of the Common Stock, the
option holders' continued employment through the option period, and the
date on which the options are exercised.
The following table sets forth certain information concerning option
exercises during the 12 months ended December 27, 1997 and the number and value
of options held by each of the Named Executive Officers on December 27, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
SHARES OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
ACQUIRED YEAR-END(#) FISCAL YEAR-END($)(1)
ON REALIZED ------------------------- -------------------------
NAME EXERCISE(#) VALUE($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ---------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
G. Drew Conway -- -- -- -- -- --
Robert E. Foley 10,000 $155,000 20,000 110,000 $325,000 $1,187,500
Richard L. Bugley 200 3,063 14,800 95,000 104,700 278,500
David Lubin -- -- -- -- -- --
</TABLE>
- ------------
(1) Based upon the market price of $21.75 per share, which was the closing
price per share of Common Stock on the Nasdaq National Market on December
27, 1997 less the option exercise price payable per share.
No stock appreciation rights were granted to any Named Executive Officer
during fiscal 1997, nor were any outstanding at December 27, 1997.
-12-
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The following is the Report of the Compensation Committee of the Company,
describing the compensation policies applicable to the Company's executive
officers with respect to compensation for the 12 months ended December 27,
1997. The information contained in the report shall not be deemed to be
"soliciting material" or to be "filed" with the SEC nor shall such information
be incorporated by reference into any future filing under the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, except to
the extent that the Company specifically incorporates it by reference into such
filing.
Compensation Philosophy
The Company's philosophy in setting its compensation policies for executive
officers is to maximize stockholder value over time. The Compensation Committee
sets the Company's compensation policies applicable to the executive officers,
including the President and Chief Executive Officer, and evaluates the
performance of such officers. The Compensation Committee strongly believes that
executive compensation should be directly linked to continuous improvements in
corporate performance and increases in stockholder value. In this regard, the
Compensation Committee has adopted the following guidelines for compensation
decisions:
. Provide a competitive total compensation package that enables the
Company to attract and retain key executive talent.
. Align all pay programs with the Company's annual and long-term business
strategies and objectives.
. Provide variable compensation opportunities that are directly linked to
the performance of the Company and that link executive reward to
stockholder return.
Components of Executive Compensation
The Compensation Committee focuses primarily on the following three
components in forming the total compensation package for its executive
officers:
. Base Salary
. Annual Incentive Bonus
. Long-Term Incentives
Base Salary
The Committee intends to compensate its executive officers, including the
President and Chief Executive Officer, competitively within the industry. In
order to evaluate the Company's competitive posture in the industry, the
Compensation Committee reviews and analyzes the compensation packages,
including base salary levels, offered by other information technology
consulting companies. In addition, the Committee also subjectively evaluates
the level of performance of each executive officer, including Mr. Conway, in
order to determine current and future appropriate pay levels. Mr. Conway's base
salary is established pursuant to an Employment Agreement dated May 13, 1996
(the "Employment Agreement") that was entered into prior to the Company's
initial pubic offering. Mr. Conway declined to be awarded a bonus for fiscal
year 1997 and for the twelve-month period ended December 27, 1997.
With respect to the other corporate executive officers of the Company, the
Committee, in consultation with the President and Chief Executive Officer and
the Chief Financial Officer of the Company, has established base salary ranges
which it believes are competitive in the industry, linking a portion of these
executives' total compensation to an annual bonus.
Annual Incentive Bonus
During fiscal 1997, the executive officers of the Company received annual
incentive bonuses to be determined by the Committee in consultation with the
President and Chief Executive Officer and the Chief Financial Officer of the
Company. These bonuses were determined upon criteria applicable to the
performance of the business units under the control of such executives and
approximated incentive bonuses awarded during fiscal 1996.
Long-Term Incentives
The Committee provides the Company's executive officers with long-term
incentive
-13-
<PAGE>
compensation through grants of stock options. The Committee is responsible for
determining the individuals to whom grants should be made, the timing of
grants, the exercise price per share and the number of shares subject to each
option. Other than stock options, the Committee made no other long-term
performance awards during the last fiscal year. Stock Option awards are granted
based on individual or corporate performance as determined subjectively by the
Committee. The Committee considers grants of options to executive officers
during each fiscal year.
The Committee believes that stock options provide the Company's executive
officers with the opportunity to purchase and maintain an equity interest in
the Company and to share in the appreciation of the value of the stock. The
Committee believes that stock options directly motivate an executive to
maximize long-term stockholder value. The options also utilize vesting periods
in order to encourage key employees to continue in the employ of the Company.
All options to executive officers to date have been granted at the fair
market value of the Company's Common Stock on the date of the grant. The
Committee considers the grant of each option subjectively, considering factors
such as the individual performance of executive officers and competitive
compensation packages in the industry. No option grants were made to Mr.
Conway.
Summary
The Compensation Committee believes that its executive compensation
philosophy of paying its executive officers well by means of competitive base
salaries and annual bonus and long-term incentives, as described in this
report, serves the interests of the Company and the Company's stockholders.
COMPENSATION COMMITTEE
Robert P. Badavas
Paul C. O'Brien
-14-
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph compares the yearly percentage change in the cumulative
total stockholder return on the Company's Common Stock during the period from
its initial public offering (June 5, 1996) through December 27, 1997 with the
cumulative total return on the Nasdaq stock index and the peer group index (the
"Peer Group"). The comparison assumes $100 was invested on June 5, 1996 in The
Registry, Inc's Common Stock and in each of such indices and assumes
reinvestment of dividends, where applicable. The Peer Group is composed of the
following companies: Computer Horizons Corp. (CHRZ), Sykes Enterprises,
Incorporated (SYKE), On Assignment, Inc. (ASGN), Data Processing Resources
Corporation (DPRC), Alternative Resources Corp. (ALRC), SCB Computer
Technology, Inc. (SCBI) and Whittman-Hart, Inc. (WHIT).
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
June 5 June 29 December 28 June 28 December 27
1996 1996 1996 1997 1997
<S> <C> <C> <C> <C> <C>
Renaissance
Worldwide 100 172.12 279.41 258.82 255.88
Peer Group 100 91.14 82.69 100.32 255.88
Broad Market 100 95.63 102.89 115.54 126.22
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Badavas and O'Brien, neither of whom is or was an executive officer
or employee of the Company, served on the Compensation Committee during the
twelve-month period ended December 27, 1997.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and executive officers, and persons who own more than
ten percent of a registered class of the Company's equity securities, to file
with the SEC initial reports of ownership and reports of changes in ownership
of Common Stock and other equity
-15-
<PAGE>
securities of the Company. Officers, directors and greater-than-ten-percent
shareholders are required by Securities and Exchange Commission regulation to
furnish the Company with copies of all Section 16(a) forms they file. During
the 12 months ended December 27, 1997, based upon a review of filings with the
SEC, the Company believes that all its officers and directors met all
applicable Section 16(a) filing requirements.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On September 19, 1995, the Company entered into four lease agreements, each
with a term ending on September 30, 2010, with the 189 Wells Avenue Realty
Trust (the "Realty Trust") for a total of approximately 18,800 square feet of
office space located at 189 Wells Avenue, Newton, Massachusetts at an annual
rent of approximately $357,000. During fiscal 1997 the Company expanded its
rental space with the Realty Trust to 28,000 square feet at annual rent of
approximately $531,000. The Company's executive offices are located in these
spaces. Mr. Conway is the sole beneficiary of the Realty Trust and Mr. Foley is
the trustee of the Realty Trust. Management believes that the terms of each
lease agreement are no less favorable to the Company than could be obtained in
a transaction with an unrelated third party.
During fiscal 1997, the Company entered into a contract with an entity
controlled by Mr. Conway to utilize an airplane for corporate travel purposes.
The Company pays for such usage on a per-flight-hour basis at a rate which
management believes approximates market prices. Total amounts paid to this
entity during the twelve-month period ended December 27, 1997 were
approximately $367,000.
Mr. O'Brien, a director of the Company, is a director of BankBoston Corp.
BankBoston, N.A., a subsidiary of BankBoston Corp., serves as the Company's
Transfer Agent and Registrar.
The Company has adopted a policy that all material transactions between the
Company and its officers, directors and other affiliates must (i) be approved
by a majority of the members of the Company's Board of Directors and by a
majority of the disinterested members of the Company's Board of Directors and
(ii) be on terms no less favorable to the Company than could be obtained from
unaffiliated third parties.
AUDIT MATTERS
Price Waterhouse LLP has been selected to audit the financial statements of
the Company for the fiscal year ending December 26, 1998, and to report the
results of their examination.
A representative of Price Waterhouse LLP is expected to be present at the
Meeting and will be afforded the opportunity to make a statement if he or she
desires to do so and to respond to appropriate questions from stockholders.
STOCKHOLDER PROPOSALS
Proposals of stockholders submitted for consideration at the Annual Meeting
of Stockholders in 1999 must be received by the Company no later than November
17, 1998.
OTHER BUSINESS
The Board of Directors knows of no business that will come before the meeting
for action except as described in the accompanying Notice of Meeting. However,
as to any such business, the persons designated as proxies will have
discretionary authority to act in their best judgment.
FORM 10-K AND ANNUAL REPORT TO STOCKHOLDERS
A copy of the Company's Annual Report to Stockholders accompanies this proxy
statement. The Company filed its Form 10-K for the fiscal year ended December
27, 1997 with the Commission on March 27, 1998.
-16-
<PAGE>
Appendix to definitive proxy materials.
The following plans are submitted pursuant to Instruction 3 to Item 10 of
Schedule 14(a):
1. 1996 Stock Plan;
2. 1996 Employee Stock Purchase Plan;
3. 1998 Directors Stock Plan.
<PAGE>
RENAISSANCE WORLDWIDE, INC.
1996 STOCK PLAN
1. Purpose. The purpose of this 1996 Stock Plan (the "Plan") is to advance
-------
the interests of Renaissance Worldwide, Inc., a Massachusetts corporation (the
"Company"), by strengthening the ability of the Company to attract, retain and
motivate key employees, officers and consultants of or to the Company or any
present or future parent or subsidiary of the Company (the "Company Group") by
providing them with an opportunity to purchase or receive as bonuses stock of
the Company and thereby permitting them to share in the Company's success. It
is intended that this purpose will be effected by granting (i) incentive stock
options ("Incentive Options") which are intended to qualify under the provisions
of Section 422 of the Internal Revenue Code of 1986, as heretofore and hereafter
amended (the "Code"), and non-statutory stock options ("Nonqualified Options")
which are not intended to meet the requirements of Section 422 of the Code and
which are intended to be taxed under Section 83 of the Code (both Incentive
Options and Nonqualified Options shall be collectively referred to as
"Options"), (ii) stock purchase authorizations ("Purchase Authorizations") and
(iii) stock bonus awards ("Bonuses").
2. Effective Date. This Plan was adopted by the Board of Directors of the
--------------
Company (the "Board") on March 6, 1996, approved by the sole stockholder of the
Company on March 22, 1996 (the "effective date" of the Plan) and subsequently
amended on January 9, 1997 to increase the number of shares that may be made
subject to Options, Purchase Authorization or Bonuses. On April ., 1998, the
Board of Directors voted to amend the Plan by increasing the number of shares
that may be made subject to Options, Purchase Authorization or Bonuses, subject
to stockholder approval.
3. Stock Covered by the Plan.
-------------------------
a. Subject to adjustment as provided in Sections 9 and 10 below, and further
subject to stockholder approval as noted in Section 2 above, the shares
that may be made subject to Options, Purchase Authorizations or Bonuses
under this Plan shall not exceed in the aggregate 7,200,000/1/ shares of
the common stock, without par value, of the Company ("Company Stock"),
plus the number of shares of Company Stock added pursuant to paragraph 3b
(the "Shares").
b. The number of Shares that may be made subject to Options, Purchase
Authorizations or Bonuses under this Plan shall automatically increase on
the first
- ----------------------
/1/ This figure was amended in the 1998 amendment to reflect the 2-for-1
stock split effected in the first quarter.
<PAGE>
day of each fiscal year, beginning in 1998 and continuing
through 2000, by a number of shares of Company Stock equal to four
percent (4%) of the total number of shares of Company Stock outstanding
on the last trading day of the previous fiscal year. For 1998, the
increase shall take effect on the date of stockholder approval of the
amendments to the Plan and shall be based on the total number of shares
of Company Stock outstanding on the day of the 1998 annual meeting.
c. The number of Shares subject to Options that are intended to be Incentive
Options shall not exceed 15,000,000.
d. Any Shares subject to an Option or Purchase Authorization which for any
reason expires or is terminated unexercised as to such Shares and any
Shares reacquired by the Company pursuant to forfeiture or a repurchase
right hereunder may again be the subject of an Option, Purchase
Authorization or Bonus under the Plan. The Shares purchased pursuant to
Purchase Authorizations or the exercise of Options under this Plan or
issued as Bonuses may, in whole or in part, be either authorized but
unissued Shares or issued Shares reacquired by the Company.
4. Administration. This Plan shall be administered by the Board, whose
--------------
construction and interpretation of the Plan's terms and provisions shall be
final and conclusive. The Board shall have authority, subject to the express
provisions of the Plan, to construe the Plan and the respective Options,
Purchase Authorizations, Bonuses and related agreements, to prescribe, amend and
rescind rules and regulations relating to the Plan, to determine the terms and
provisions of the respective Options, Purchase Authorizations, Bonuses and
related agreements, and to make all other determinations in the judgement of the
Board necessary or desirable for the administration of the Plan. The Board may
correct any defect or supply any omission or reconcile any inconsistency in the
Plan or in any Option, Purchase Authorization, Bonus, or related agreement in
the manner and to the extent it shall deem expedient to carry the Plan into
effect, and it shall be the sole and final judge of such expediency. No
director shall be liable for any action or determination made in good faith.
Effective on and as of the date that the Company registers the Company Stock
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the
"Act"), the Plan shall be administered by a committee (the "Committee")
consisting of not less than two (2) members of the Board, provided that the
Committee may delegate authority to grant Options to any single member of the
Board subject to such guidelines and qualifications as may be from time to time
determined by the Committee. Each member of the Committee must be an "outside
director" as that term is used in Treasury Regulation Section 1.162-27(e)(3)(i)
under Section 162(m) of the Code.
The Committee shall be appointed by, and shall serve at the pleasure of, the
Board and shall have the powers granted to the Board in this Section 4, and on
and after the commencement of the Committee's duties hereunder, all references
(other than in this
-2-
<PAGE>
sentence) to the Board in Sections 4, 5 and 7 of this Plan or as specified in
any agreement associated with this Plan shall mean and relate to such Committee.
5. Eligible Recipients. Options, Purchase Authorizations and Bonuses may be
-------------------
granted to such key employees, officers, directors or consultants of or to the
Company Group, as are selected by the Board (a "Participant"); provided,
however, that only employees of the Company Group may be granted Incentive
Options.
6. Duration of the Plan. This Plan shall terminate ten (10) years from the
--------------------
effective date hereof, unless terminated earlier pursuant to Section 14 below,
and no Options, Purchase Authorizations or Bonuses may be granted or made
thereafter.
7. Terms and Conditions of Options, Purchase Authorizations and Bonuses.
--------------------------------------------------------------------
Options, Purchase Authorizations and Bonuses granted or made under this Plan
shall be evidenced by agreements in such form and containing such terms and
conditions as the Committee shall determine; provided, however, that such
agreements shall evidence among their terms and conditions the following:
a. Price. The purchase price per Share payable upon the exercise of each
-----
Option or the purchase pursuant to each Purchase Authorization granted or
made hereunder shall be determined by the Committee at the time the
Option or Purchase Authorization is granted or made. The purchase price
per Share payable upon the exercise of each Incentive Option granted
hereunder shall not be less than one hundred percent (100%) of the fair
market value per Share of Company Stock on the day the Incentive Option
is granted (or 110% in the case of Incentive Options to which paragraph
7(j)(i) applies). The purchase price per Share payable on exercise of
each Nonqualified Option or upon the purchase of Shares pursuant to each
Purchase Authorization granted hereunder shall be not less than eighty-
five percent (85%) of the fair market value per Share of Company Stock on
the date of the grant. Fair market value shall be determined in
accordance with procedures to be established in good faith by the Board.
Bonus Shares shall be issued in consideration of services previously
rendered, which shall be valued for such purposes by the Board.
b. Number of Shares. Each agreement shall specify the number of Shares to
----------------
which it pertains. The maximum number of Shares with respect to which
Options may be granted under the Plan to any individual during any single
calendar year shall be 200,000 Shares.
c. Exercise of Options. Each Option shall be exercisable for the full
-------------------
amount or for any part thereof and at such intervals or in such
installments as the Board may determine at the time it grants such
Option; provided, however, that no Option shall be exercisable with
respect to any Shares later than ten (10) years after the date of
-3-
<PAGE>
the grant of such Option (or five (5) years in the case of Incentive
Options to which paragraph 7(j)(ii) applies). An Option shall be
exercisable only by delivery of a written notice to the Company's
Treasurer, or any other officer of the Company designated by the Board to
accept such notices on its behalf, specifying the number of Shares for
which the Option is exercised and accompanied by either (i) full payment
or (ii) if permitted by the Board, irrevocable instructions to a broker
to promptly deliver to the Company full payment in accordance with
subparagraph (ii) of the first sentence of paragraph 7(d) below of the
amount necessary to pay the aggregate exercise price. With respect to an
Incentive Option, the permission of the Board referred to in clause (ii)
of the preceding sentence must be specifically granted at the time the
Incentive Option is granted.
d. Payment. Payment shall be made in full (i) at the time the Option is
-------
exercised, (ii) promptly after the Participant forwards the irrevocable
instructions referred to in paragraph 7(c)(ii) above to the appropriate
broker, if exercise of an Option is made pursuant to paragraph 7(c)(ii)
above, or (iii) at the time the purchase pursuant to a Purchase
Authorization is made. Payment shall be made either (a) in cash, (b) by
check, (c) if permitted by the Board (with respect to an Incentive
Option, such permission to have been granted at the time of the Incentive
Option grant), by delivery and assignment to the Company of shares of
Company Stock (provided that such shares have been held by such
Participant for at least 6 months before delivery) having a fair market
value (as determined by the Board) equal to the exercise or purchase
price, (d) if permitted by the Board, stated in the agreement evidencing
the Option or Purchase Authorization, and to the extent permitted by any
applicable law, by the Participant's recourse promissory note, which note
must be due and payable not more than five (5) years after the date the
Option or Purchase Authorization is exercised, or (e) by a combination of
(a), (b), (c) and/or (d). If shares of Company Stock are to be used to
pay the exercise price of an Incentive Option, the Company prior to such
payment must be furnished with evidence satisfactory to it that the
acquisition of such shares and their transfer in payment of the exercise
price satisfy the requirements of Section 422 of the Code and other
applicable laws.
e. Withholding Taxes; Delivery of Shares. The Company's obligation to
-------------------------------------
deliver Shares upon exercise of an Option or upon purchase pursuant to a
Purchase Authorization or issuance pursuant to a Bonus shall be subject
to the satisfaction of all applicable federal, state and local income and
employment tax withholding obligations. Without limiting the generality
of the foregoing, the Company shall have the right to deduct from
payments of any kind otherwise due to the Participant any federal, state
or local taxes of any kind required by law to be withheld with respect to
any Shares issued upon exercise of Options or purchased or issued
pursuant to Purchase Authorization or Bonuses. The Participant may elect
to satisfy such obligation(s), in whole or in part, by (i) delivering to
the Company a check for
-4-
<PAGE>
the amount required to be withheld or (ii) if the Board in its sole
discretion approves in any specific or general case, having the Company
withhold Shares or delivering to the Company already-owned shares of
Company Stock, having a value equal to the amount required to be
withheld, as determined by the Board.
f. Non-Transferability. No Option or Purchase Authorization shall be
-------------------
transferable by the Participant otherwise than by will or the laws of
descent or distribution, and each Option or Purchase Authorization shall
be exercisable during the Participant's lifetime only by the Participant;
provided, however, that (i) Nonqualified Options may be transferred
pursuant to a qualified domestic relations order (as defined in Rule 16b-
3 under the Act) and (ii) the Board may grant Nonqualified Options that
are transferable (subject to any terms and conditions imposed by the
Board) by the Participant, either directly or in trust, to one or more
members of the Participant's family, and the Board may amend accordingly
the form of Option Grant attached hereto. Following any transfer
permitted pursuant to this paragraph, of which the Participant has
notified the Board in writing, such option may be exercised by the
transferee(s), subject to all terms and conditions of the Option Grant.
For these purposes, the members of the Participant's family are only the
Participant's: (i) spouse, (ii) lineal descendants; (iii) lineal
ancestors; and (iv) siblings and spouses and children of such siblings.
g. Termination of Options and Purchase Authorizations. The Board is
--------------------------------------------------
authorized, subject to the express provisions of this Plan, to determine
the timing and terms on which an Option or Purchase Authorization granted
or awarded hereunder shall terminate and to alter or amend the form of
Option Agreement attached hereto to effect such determinations.
h. Rights as Stockholders. A Participant shall have no rights as a
----------------------
stockholder with respect to any Shares covered by an Option, Purchase
Authorization or Bonus until the date of issuance of a stock certificate
in the Participant's name for such Shares.
i. Repurchase of Shares by the Company. Any Shares purchased or acquired
-----------------------------------
upon exercise of an Option or pursuant to a Purchase Authorization or
Bonus may in the discretion of the Board be subject to repurchase by or
forfeiture to the Company and to the extent set forth in the option,
purchase or bonus agreement pursuant to which the Shares were purchased
or acquired. Certificates representing Shares subject to such repurchase
or forfeiture may be subject to such escrow and stock legending
provisions as may be set forth in the option, purchase or bonus agreement
pursuant to which the Shares were purchased or acquired.
j. 10% Stockholder. If any Participant to whom an Incentive Option is
---------------
granted pursuant to the provisions of the Plan is on the date of grant
the owner of stock (as determined under Section 424(d) of the Code)
possessing more than 10% of the
-5-
<PAGE>
total combined voting power or value of all classes of stock of the
Company, its parent, if any, or subsidiaries, then the following special
provisions shall be applicable:
i. The exercise price per Share subject to such Option shall not be less
than 110% of the fair market value of each Share on the date of
grant; and
ii. The Option shall not have a term in excess of five years from the
date of grant.
k. Confidentiality and Non-Solicitation Agreements. In the sole discretion
-----------------------------------------------
of the Board, each Participant shall be required to execute, prior to or
contemporaneously with the grant of any Option, Purchase Authorization or
Bonus hereunder, the Company's then standard form of agreement relating
to nondisclosure of confidential information, non-solicitation and
related matters.
8. Restrictions on Incentive Options. Incentive Options granted under this
---------------------------------
Plan shall be specifically designated as such and shall be subject to the
additional restriction that the aggregate fair market value, determined as of
the date the Incentive Option is granted, of the Shares with respect to which
Incentive Options are exercisable for the first time by a Participant during any
calendar year shall not exceed $100,000. If an Incentive Option which exceeds
the $100,000 limitation of this paragraph 8 is granted, the portion of such
Option which is exercisable for Shares in excess of the $100,000 limitation
shall be treated as a Nonqualified Option pursuant to Section 422(d) of the
Code, notwithstanding its original designation as an Incentive Option. In the
event that such Participant is eligible to participate in any other stock
incentive plans of the Company, its parent, if any, or a subsidiary which are
also intended to comply with the provisions of Section 422 of the Code, such
annual limitation shall apply to the aggregate number of Shares for which
options may be granted under all such plans.
9. Stock Dividends; Stock Splits; Stock Combinations; Recapitalizations.
--------------------------------------------------------------------
Appropriate adjustment shall be made by the Board in the maximum number of
Shares subject to the Plan and in the number, kind, and exercise or purchase
price of Shares covered by outstanding Options and Purchase Authorizations
granted hereunder to give effect to any stock dividends, stock splits, stock
combinations, recapitalizations and other similar changes in the capital
structure of the Company after the effective date of the Plan.
10. Merger; Sale of Assets.
----------------------
a. In the event of a change of the Company Stock resulting from a merger or
similar reorganization as to which the Company is the surviving
corporation, the number and kind of Shares which thereafter may be
purchased pursuant to an Option or Purchase Authorization under the Plan
and the number and kind of Shares then
-6-
<PAGE>
subject to Options or Purchase Authorizations granted hereunder and the
price per Share thereof shall be appropriately adjusted in such manner as
the Board may determine equitable to prevent dilution or enlargement of
the rights available or granted hereunder.
b. Except as otherwise determined by the Board, a merger or a similar
reorganization which the Company does not survive, or a sale of all or
substantially all of the assets of the Company, shall cause every Option
and Purchase Authorization hereunder to terminate, to the extent not then
exercised, unless any surviving entity agrees to assume the obligations
hereunder; provided, however, that, in the case of such a merger or
similar reorganization, or such a sale of all or substantially all of the
assets of the Company, if there is no such assumption, the Board may
provide that some or all of the unexercised portion of any one or more of
the outstanding Options or Purchase Authorizations and some or all of the
Unvested Shares (as defined in the applicable agreement with the
Participant) acquired upon exercise of any one or more of such Options or
Purchase Authorizations or acceptance of any one or more of the
outstanding Bonuses shall be immediately exercisable and vested or no
longer subject to repurchase rights as of such date prior to such merger,
similar reorganization or sale of assets as the Board determines.
c. If any person or group, other than the Company, any of its subsidiaries
or affiliates or any employee benefit plan of the Company, either
publicly or in a written communication to the Company or to its Board of
Directors, makes a tender or exchange offer or other bona fide offer to
acquire directly or indirectly voting securities under circumstances such
that, immediately after such acquisition, such person or group would
beneficially own voting securities with aggregate voting power
representing 20% or more of the total voting power of the Company, the
Board may in its sole discretion provide that all outstanding options
shall immediately become fully exercisable.
11. Investment Representations; Transfer Restrictions. The Company may
-------------------------------------------------
require Participants, as a condition of purchasing Shares pursuant to the
exercise of an Option or to a Purchase Authorization or receipt of Shares as a
Bonus, to give written assurances in substance and form satisfactory to the
Company to the effect that such person is acquiring the Shares for the
Participant's own account for investment and not with any present intention of
selling or otherwise distributing the same, and to such other effects as the
Company deems necessary or appropriate (including without limitation
confirmation that the Participant is aware of any applicable restrictions on
transfer of the Shares, as specified in the by-laws of the Company or otherwise)
in order to comply with federal and applicable state securities laws.
-7-
<PAGE>
12. Definitions.
-----------
a. The term "employee" shall have, for purposes of this Plan, the meaning
ascribed to "employee" under Section 3401(c) of the Code and the
regulations promulgated thereunder.
b. The term "parent" shall have, for purposes of this Plan, the meaning
ascribed to it under Section 424(e) of the Code and the regulations
promulgated thereunder.
c. The term "subsidiary" shall have, for all purposes under this Plan, the
meaning ascribed to it under Section 424(f) of the Code and the
regulations promulgated thereunder.
13. Termination or Amendment of Plan. The Board may at any time terminate
--------------------------------
the Plan or make such changes in or additions to the Plan as it deems advisable
without further action on the part of the stockholders of the Company, provided:
a. that no such termination or amendment shall adversely affect or impair
any then outstanding Option, Purchase Authorization, Bonus or related
agreement without the consent of the Participant holding such Option,
Purchase Authorization, Bonus or related agreement; and
b. that no such amendment which (i) increases the maximum number of Shares
subject to this Plan (except to the extent provided in Sections 3, 9 and
10) or (ii) increases the benefits accruing to Participants or modifies
the requirements as to eligibility for participation in the Plan (but
only to the extent that either such change would require approval by the
stockholders pursuant to the Code or the regulations thereunder) may be
made without obtaining, or being conditioned upon, stockholder approval.
With the written consent of the Participant affected, the Board may amend
outstanding Options, Purchase Authorizations, Bonuses or related agreements in a
manner not inconsistent with the Plan. The Board shall have the right to amend
or modify the terms and provisions of the Plan and of any outstanding Incentive
Options granted under the Plan to the extent necessary to qualify any or all
such Options for such favorable federal income tax treatment (including deferral
of taxation upon exercise) as may be afforded incentive stock options under
Section 422 of the Code.
14. Governing Law. This Plan shall be governed by, and construed and
-------------
enforced in accordance with, the laws of the Commonwealth of Massachusetts.
-8-
<PAGE>
RENAISSANCE WORLDWIDE, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
(As Amended and Restated Effective May __, 1998)
The following constitute the provisions of the 1996 Employee Stock Purchase
Plan of Renaissance Worldwide, Inc. (formerly, The Registry, Inc.1996 Employee
Stock Purchase Plan).
1. Purpose. The purpose of the Plan is to provide employees of the Company
-------
and its Subsidiaries with an opportunity to purchase Common Stock of the
Company. It is the intention of the Company to have the Plan qualify as an
"Employee Stock Purchase Plan" under Section 423 of the Internal Revenue
Code of 1986, as amended. The provisions of the Plan shall, accordingly,
be construed so as to extend and limit participation in a manner consistent
with the requirements of that section of the Code.
2. Definitions.
-----------
(a) "Board" shall mean the Board of Directors of the Company.
-----
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
----
(c) "Common Stock" shall mean the Common Stock, no par value, of the
------------
Company.
(d) "Company" shall mean Renaissance Worldwide, Inc., a Massachusetts
-------
corporation.
(e) "Compensation" shall mean all base pay, salary, bonuses and
------------
commissions, including payments for overtime and sales commissions.
(f) "Contributions" shall mean all amounts credited to the account of a
-------------
participant pursuant to the Plan.
(g) "Eligible Employee" shall mean any person who is an Employee on the
-----------------
first day of any Offering Period.
(h) "Employee" shall mean any person, including an officer, who is an
--------
employee of the Company or one of its Subsidiaries, as determined
pursuant to Treasury Regulation Section 1.421-7(h) or any successor
thereto.
(i) "Employment Date" shall mean the first date on which an Employee first
---------------
performs an hour of service for the Company following his or her
original date of hire with the Company.
<PAGE>
(j) "Exercise Date" shall mean the last business day of each Offering
-------------
Period of the Plan.
(k) "Offering Date" shall mean the first business day of each Offering
-------------
Period of the Plan.
(l) "Offering Period" shall mean the period described in Section 4.
---------------
(m) "Plan" shall mean this Employee Stock Purchase Plan, as amended from
----
time to time.
(n) "Subsidiary" shall mean a corporation, domestic or foreign, defined as
----------
such in Section 424(f) of the Code, whether or not such corporation
now exists or is hereafter organized or acquired by the Company or a
Subsidiary, that has adopted the Plan with the consent of the Company.
(o) "Termination of Service" shall mean any period following an
----------------------
individual's Employment Date during which an individual ceases to be
employed by the Company or any Subsidiary.
3. Eligibility.
-----------
(a) Except as otherwise provided below, any person who is an Eligible
Employee as of the Offering Date of a given Offering Period shall be
eligible to participate in such Offering Period under the Plan.
(b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately
after the grant, such Employee (or any other person whose stock would
be attributed to such Employee pursuant to Section 424(d) of the Code)
would own stock and/or hold outstanding options to purchase stock
possessing five percent (5%) or more of the total combined voting
power or value of all classes of stock of the Company or of any
subsidiary of the Company, or (ii) if such option would permit his or
her rights to purchase stock under all employee stock purchase plans
(described in Section 423 of the Code) of the Company and its
Subsidiaries to accrue at a rate which exceeds twenty-five thousand
dollars ($25,000) of fair market value of such stock (determined at
the time such option is granted) for each calendar year in which such
option is outstanding at any time.
4. Offering Periods. The periods of January 1 to June 30 and July 1 to
----------------
December 31 of each year (or such other time or times as may be determined
by the Board consistent with the
-2-
<PAGE>
requirements of Code (S)423) will each be termed an "Offering Period." The
Plan shall continue until terminated in accordance with the terms of the
Plan. The Board shall have the power to change the duration and/or the
frequency of Offering Periods with respect to future offerings without
stockholder approval if such change is announced at least fifteen (15) days
prior to the scheduled beginning of the first Offering Period to be
affected by such change.
5. Method of Participation. For each Offering Period, an Eligible Employee
-----------------------
may elect to participate in the Plan by executing and delivering to the
Company's Human Resources Department, at such time, in such manner and on
such form as shall be prescribed by the Company, a written subscription
agreement.
6. Payroll Deduction.
-----------------
(a) The written subscription agreement will contain a payroll deduction
authorization that will request withholding at a rate (in whole
percentages) of not less than 1% nor more than 10% from the
Participant's Compensation by means of substantially equal payroll
deductions over the Offering Period (exception during a Termination of
Service that does not affect participation as provided in Section 10
herein) from payroll periods ending in the Offering Period.
(b) All payroll deductions made by a participant shall be credited to his
or her account under the Plan. A participant may not make any
additional payments into such account.
(c) A participant may discontinue his or her participation in the Plan as
provided in Section 10, or, on one occasion only during the Offering
Period, may increase or decrease the rate of his or her Contributions
during the Offering Period by completing and filing with the Company a
new subscription agreement at such time as may be determined by the
Company prior to the date on which the change is to be effective. The
change in rate shall be effective as of the beginning of the calendar
quarter following the date of filing of the new subscription
agreement.
(d) Notwithstanding the foregoing, to the extent necessary to comply with
Section 423(b)(8) of the Code and Section 3(b) herein, a participant's
payroll deductions shall be decreased to zero (0%) percent at such
time during any Offering Period which is scheduled to end during the
current calendar year that the aggregate of all payroll deductions
accumulated with respect to such Offering Period and any other
Offering Period ending within the same calendar year equal or exceed
twenty-five thousand dollars ($25,000). Payroll deductions shall re-
commence at the rate provided in such participant's then current
subscription agreement at the beginning of the first Offering Period
which is scheduled to end in the following calendar year, unless
terminated by the participant as provided in Section 10.
-3-
<PAGE>
7. Grant of Option; Option Price.
-----------------------------
(a) On the Offering Date of each Offering Period, each Eligible Employee
participating in such Offering Period shall be granted an option to
purchase on the Exercise Date a maximum of two hundred (200) shares of
the Company's Common Stock (subject to adjustment as provided in
subsection 18(a) hereof) to the extent of the Employee's Contributions
accumulated prior to the Exercise Date. The number of shares within
the above-stated maximum that a participant may acquire shall be
determined by dividing such Employee's Contributions accumulated prior
to such Exercise Date and retained in the participant's account as of
the Exercise Date by the purchase price per share of the Company's
Common Stock (determined under Section 7(b)). The Company will reduce
on a substantially proportionate basis, the number of shares of Common
Stock receivable by each participant upon the exercise of his option
for an Offering Period in the event that the number of shares then
available under the Plan is otherwise insufficient, as provided in
Section 12.
(b) The purchase price per share of the Common Stock issued pursuant to
the exercise of an option (the "Option Price") will be 85% of the fair
market value of the Common Stock at (1) the time of grant of the
option or (2) the time at which the option is deemed exercised,
whichever is less. The fair market value of the Company's Common
Stock on a given date shall be determined by the Board based on (i)
the average of the high and low prices of the Common Stock on such
date on the principal national securities exchange on which the Common
Stock is traded, if the Common Stock is then traded on a national
securities exchange; or (ii) the last reported sale price of the
Common Stock on the NASDAQ National Market System on such date, if the
Common Stock is not then traded on a national securities exchange; or
(iii) the closing bid price or the average of bid prices last quoted
on such date by an established quotation service for over-the-counter
securities, if the Common Stock is not reported on the NASDAQ National
Market System or on a national securities exchange. If the Common
Stock is not publicly traded at the time a right is granted under this
Plan, "fair market value" shall mean the fair market value of the
Common Stock as determined by the Board in its discretion after taking
into consideration all factors which it deems appropriate, including,
without limitation, recent sale and offer prices of the Common Stock
in private transactions negotiated at arm's length.
8. Exercise of Option. Unless a participant withdraws from the Plan as
------------------
provided in Section 10, his or her option for the purchase of shares will
be exercised automatically on the Exercise Date of the Offering Period, and
the maximum number of shares (including fractional shares) subject to
option (but in no event more than two hundred (200), subject to adjustment
as provided in subsection 18(a) hereof) will be purchased at the applicable
Option Price with the accumulated Contributions in his or her account. The
shares
-4-
<PAGE>
purchased upon exercise of an option hereunder shall be deemed to be
transferred to the participant on the Exercise Date. During his or her
lifetime, a participant's option to purchase shares hereunder is
exercisable only by him or her.
9. Delivery. As promptly as practicable after the Exercise Date of each
--------
Offering Period, the Company shall arrange the delivery to each
participant, as appropriate, of a certificate representing the shares
purchased upon exercise of his or her option. Any cash remaining to the
credit of a participant's account under the Plan after a purchase by him or
her of shares at the termination of each Offering Period shall be returned
to the participant.
10. Withdrawal; Termination of Employment.
-------------------------------------
(a) A participant may withdraw all but not less than all the Contributions
credited to his or her account under the Plan at any time prior to the
Exercise Date of the Offering Period by giving written notice to the
Company. All of the participant's Contributions credited to his or
her account will be paid to him or her promptly after receipt of his
or her notice of withdrawal and his or her option for the current
period will be automatically terminated, and no further Contributions
for the purchase of shares will be made during the Offering Period.
Upon such withdrawal, the balance in his or her withholding account
will be returned to the participant.
(b) In the event that a participant incurs a Termination of Service for
any reason during the three months beginning with the Offering Date
and ending on the day three (3) months before the Exercise Date, the
participant's option shall terminate, and the Contributions credited
to his or her account will be returned to him or her or, in the case
of his or her death, to his or her designated beneficiary hereunder
(or as otherwise provided in Section 14(b) herein), and the
participant or his or her designated beneficiary, as the case may be,
will have no further rights under the Plan. In the event that a
participant incurs a Termination of Service for any reason on any date
following the day three months before the Exercise Date, the
participant's option shall not, by reason of such Termination of
Service, terminate, and the participant's account balance will remain
in the Plan and the option exercised as provided herein, unless the
participant earlier withdraws from the Plan pursuant to subsection
10(a) above.
11. Interest. No interest shall accrue on the Contributions of a participant
--------
in the Plan.
12. Stock.
-----
(a) The maximum number of shares of the Company's Common Stock which shall
be made available for sale under the Plan shall be three hundred
thousand (300,000)
-5-
<PAGE>
shares, subject to adjustment upon changes in capitalization of the
Company as provided in subsection 18(a) hereof. If the total number of
shares which would otherwise be subject to options granted pursuant to
Section 7(a) on the Offering Date of an Offering Period exceeds the
number of shares then available under the Plan (after deduction of all
shares for which options have been exercised or are then outstanding),
the Company shall make a pro rata allocation of the shares remaining
available for option grant in as uniform a manner as shall be
practicable and as it shall determine to be equitable and consistent
with the requirements of Section 423(b)(5) of the Code. In such event,
the Company shall give written notice of such reduction of the number
of shares subject to the option to each Employee affected thereby and
shall similarly reduce the rate of Contributions, if necessary.
(b) The participant will have no interest or voting right in shares
covered by his or her option until such option has been exercised.
(c) Shares to be delivered to a participant under the Plan will be
registered in the name of the participant or in the name of the
participant and his or her spouse, at the participant's election.
13. Administration of Plan. The Plan will be administered by the Board of
----------------------
Directors (or a committee thereof), which will have the right to determine
any questions which may arise regarding the interpretation and application
of the provisions of the Plan and to make or rescind, administer, and
interpret such rules and regulations as it will deem necessary or
advisable. For example, without limitation, the Board (or its delegee) may
limit the frequency and/or number of changes in the amount withheld during
an Offering Period, permit payroll withholding in excess of the amount
designated by a participant in order to adjust for delays or mistakes in
the Company's processing of properly completed withholding elections,
establish reasonable waiting and adjustment periods and/or accounting and
crediting procedures to ensure that amounts applied toward the purchase of
Common Stock for each participant properly correspond with amounts withheld
from the participant's Compensation.
14. Designation of Beneficiary.
--------------------------
(a) A participant may file a written designation of a beneficiary who is
to receive any shares and cash, if any, from the participant's account
under the Plan in the event of such participant's death subsequent to
the end of the Offering Period but prior to delivery to him or her of
such shares and cash.
(b) Such designation of beneficiary may be changed by the participant at
any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated
under the Plan who is living at the time of such
-6-
<PAGE>
participant's death, Company shall deliver such shares and/or cash to
the executor or administrator of the estate of the participant, or if
no such executor or administrator has been appointed (to the knowledge
of the Company), the Company, in its discretion, may deliver such
shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative
is known to the Company, then to such other person as the Company may
designate. To the extent of any such delivery of shares and/or cash
hereunder, the Company's obligation under the Plan with respect to the
participant shall be discharged.
15. Transferability. Neither Contributions credited to a participant's account
---------------
nor any rights with regard to the exercise of an option or to receive
shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by will, the laws of descent and
distribution, or as provided in Section 14) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be
without effect, except that the Company may treat such act as an election
to withdraw funds in accordance with Section 10.
16. Use of Funds. All Contributions received or held by the Company under the
------------
Plan may be used by the Company for any corporate purpose, and the Company
shall not be obligated to segregate such Contributions.
17. Reports. Individual accounts will be maintained for each participant in
-------
the Plan. Statements of account will be given to participating Employees
promptly following the Exercise Date, which statements will set forth the
amounts of Contributions, the per share purchase price, the number of
shares purchased and the remaining cash balance, if any.
18. Adjustments Upon Changes in Capitalization.
------------------------------------------
(a) The number of shares of Common Stock covered by each option under the
Plan which has not yet been exercised and the number of shares of
Common Stock which have been authorized for issuance under the Plan
but have not yet been placed under option (collectively, the
"Reserves"), as well as the price per share of Common Stock covered by
each option under the Plan which has not yet been exercised, shall be
proportionately adjusted for any increase or decrease in the number of
issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the
Common Stock, or any other increase or decrease in the number of
shares of Common Stock effected without receipt of consideration by
the Company. Such adjustment shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issue by the Company of shares
of stock of any class, or securities convertible into shares of stock
of any
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<PAGE>
class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock
subject to an option.
(b) In the event of the proposed dissolution or liquidation of the
Company, the Offering Period will terminate immediately prior to the
consummation of such proposed action, the options granted during such
Offering Period shall terminate and each participant's contributions
shall be returned, unless otherwise provided by the Board. In the
event of a proposed sale of all or substantially all of the assets of
the Company, or the merger of the Company with or into another
corporation, each option under the Plan shall be assumed or an
equivalent option shall be substituted by such successor corporation
or a parent or subsidiary of such successor corporation, unless the
Board determines, in the exercise of its sole discretion and in lieu
of such assumption or substitution, to shorten the Offering Period
then in progress by setting a new Exercise Date (the "New Exercise
Date"). If the Board shortens the Offering Period then in progress in
lieu of assumption or substitution in the event of a merger or sale of
assets, the Board shall notify each participant in writing, at least
ten (10) days prior to the New Exercise Date, that the Exercise Date
for his or her option has been changed to the New Exercise Date and
that his or her option will be exercised automatically on the New
Exercise Date, unless prior to such date he or she has withdrawn from
the Offering Period as provided in Section 10. For purposes of this
Section, an option granted under the Plan shall be deemed to be
assumed if, following the sale of assets or merger, the option confers
the right to purchase, for each share of option stock subject to the
option immediately prior to the sale of assets or merger, the
consideration (whether stock, cash or other securities or property)
received in the sale of assets or merger by holders of Common Stock
for each share of Common Stock held on the effective date of the
transaction (and if such holders were offered a choice of
consideration, the type of consideration chosen by the holders of a
majority of the outstanding shares of Common Stock); provided,
however, that if such consideration received in the sale of assets or
merger was not solely common stock of the successor corporation or its
parent (as defined in Section 424(e) of the Code), the Board may, with
the consent of the successor corporation, provide for the
consideration to be received upon exercise of the option to be solely
common stock of the successor corporation or its parent equal in fair
market value to the per share consideration received by holders of
Common Stock in the sale of assets or merger.
The Board may, if it so determines in the exercise of its sole
discretion but subject to the requirements of Section 423 of the Code,
also make provision for adjusting the Reserves, as well as the price
per share of Common Stock covered by each outstanding option, in the
event that the Company effects one or more reorganizations,
recapitalizations, rights offerings or other increases or reductions
of shares of its outstanding Common Stock not covered by subsection
(a) hereof,
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<PAGE>
and in the event of the Company being consolidated with or merged into
any other corporation.
(c) In the event of a proposed sale of all or substantially all the assets
or stock of any Subsidiary, the options granted to affected
participants' of such Subsidiary during such Offering Period shall
terminate and each participant's contributions shall be returned,
unless otherwise provided by the Board.
19. Amendment or Termination.
------------------------
(a) The Board reserves the right at any time or times to amend the Plan to
any extent and in any manner it may deem advisable by vote of the
Board; provided, however, that any amendment relating to the aggregate
number of shares which may be issued under the Plan (other than an
adjustment provided for in Section 18) or to the Employees (or class
of Employees) eligible to receive options under the Plan will have no
force or effect unless it will have been approved by the shareholders
within twelve months before or after its adoption. Such amendments
may include, without limitation, (without stockholder consent and
without regard to whether any participant rights may be considered to
have been adversely affected), a change or changes to the duration of
future Offering Periods (subject to Section 4 hereof).
(b) The Plan may be suspended or terminated at any time by the Board of
Directors, but no such suspension or termination will adversely affect
the rights and privileges of holders of the outstanding options. The
Plan will terminate in any case when all or substantially all of the
Common Stock reserved for the purposes of the Plan has been purchased.
20. Notices. All notices or other communications by a participant to the
-------
Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the
location, or by the person, designated by the Company for the receipt
thereof.
21. Conditions Upon Issuance of Shares. Shares shall not be issued with
----------------------------------
respect to an option unless the exercise of such option and the issuance
and delivery of such shares pursuant thereto shall comply with all
applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Securities Exchange
Act of 1934, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the shares may then be
listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
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<PAGE>
As a condition to the exercise of an option, the Company may require the
person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by
any of the aforementioned applicable provisions of law.
22. Term of Plan; Effective Date. The Plan shall become effective upon the
----------------------------
earlier to occur of its adoption by the Board or its approval by the
stockholders of the Company. It shall continue in effect for a term of ten
(10) years unless sooner terminated under Section 19.
23. Employment Rights. Nothing contained in the provisions of the Plan will be
-----------------
construed to give any Employee the right to be retained in the employ of
the Company or to interfere with the right of the Company to discharge any
employee at any time.
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<PAGE>
RENAISSANCE WORLDWIDE, INC.
1998 DIRECTORS STOCK PLAN
1. Purpose. The purpose of this plan (the "Plan") is promote the
-------
recruiting and retention of highly qualified directors and to strengthen the
commonality of interest between directors and stockholders by providing for the
grant of options to purchase shares of the common stock, no par value (the
"Stock"), of Renaissance Worldwide, Inc., a Massachusetts corporation (the
"Company"), to Eligible Directors (as defined in Section 5 of the Plan) and to
provide for the receipt by Eligible Directors of all or a portion of their
directors fees in the form of stock options. The Company believes that the
granting of such options will serve to enhance the Company's ability to attract
and retain the services of such persons, to provide additional incentives to
them and to encourage the highest level of performance by them by offering them
a proprietary interest in the Company's success. The Company also believes that
the Plan will encourage directors to make greater equity in the Company, more
closely aligning the interests of the directors and the stockholders.
2. Effective Date. This Plan was adopted by the Board of Directors of
--------------
the Company (the "Board") in April 1998 and submitted to the stockholders of the
Company for approval at the transition annual meeting held on May 28, 1998.
This Plan replaces the 1996 Eligible Directors' Stock Plan.
3. Stock Covered by the Plan. Subject to the adjustment provided in
-------------------------
Section 8, the aggregate number of shares of Stock which may be issued and sold
pursuant to options granted under the Plan shall not exceed one hundred twenty
thousand (120,000) shares, plus such number of shares that may be issued
pursuant to options awarded in lieu of director fees. Shares of Stock issued
under this Plan may be either authorized but unissued shares or treasury shares.
If any option granted under the Plan shall terminate or expire without being
fully excised, the shares which have not been purchased thereunder will again
become available for purposes of the Plan.
4. Administration. The Plan will be administered by the Board of
--------------
Directors of the Company (the "Board"), whose construction and interpretation of
the terms and provisions of the Plan shall be final and conclusive. The Board
may delegate its power to administer the Plan to a committee (the "Committee")
consisting of not less than two directors of the Company. All questions of
interpretation of the Plan or of any options issued under it shall be determined
by the Board, or any Committee, and such determination shall be final and
binding upon all persons having an interest in the Plan. No Board member or
member of a Committee shall be liable for any action or determination under the
Plan made in good faith.
<PAGE>
5. Formula Option Grants. "Eligible Directors" shall mean directors of
---------------------
the Company who are not employees of the Company or any of its subsidiaries.
All options granted under the Plan shall be non-statutory stock options which
are not intended to meet the requirements of Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code") and which are intended to be taxed under
Section 83 of the Code.
Each Eligible Director shall be automatically granted an option to purchase
20,000 shares of Stock (subject to adjustment as specified in Section 8 hereof)
on the date that he or she is first elected a director of the Company. This
option is referred to as the "Initial Award." On the day of the annual meeting
of stockholders, immediately prior to the meeting, each Eligible Director who
served during the preceding year shall be awarded an option to purchase 2,500
shares of Stock (prorated if the Eligible Director did not serve for the entire
preceding year). At the 1998 annual meeting of stockholders, each Eligible
Director shall be automatically granted an option to purchase 5,000 shares of
Stock immediately following the meeting. These options are referred to as the
"Annual Awards."
6. Options in lieu of Annual Retainer.
----------------------------------
(a) Mandatory Amount. Each Eligible Director shall receive 50% of his
----------------
or her Annual Retainer (the "Fixed Portion") in the form of stock options
as provided hereunder. "Annual Retainer" means the amount that a director
is entitled to receive for serving as a director from the date of one
annual stockholders meeting (an "Annual Meeting") through the next Annual
Meeting, as determined from time to time by the Board of Directors. For
1998, the Annual Retainer has been fixed at $12,000.
(b) Elective Amount. Commencing on the date of the Annual Meeting on
---------------
May 28, 1998, each Eligible Director may elect to take all or any portion
of the balance of his or her Annual Retainer (the "Elective Portion") in
the form of options as provided below. In order to receive the Elective
Portion in options under the Plan, the director must complete and deliver
to the Company a written election form (the "Election Form") on which he or
she designates the Elective Portion. The election shall be irrevocable
unless modified or revoked as provided in this subsection. In order to
modify or revoke an election, the director must complete and deliver to the
Company a change in Election Form at least six months prior to the proposed
effective date providing that the modification or revocation shall be
effective on the effective date. The Elective Portion for any Eligible
Director who does not deliver an Election Form to the Company shall be 0%.
(c) Formula. The number of shares underlying options granted to any
-------
Eligible Director under this Section 6 shall be equal to the whole number
(with any fractional interests rounded up to the next highest whole number)
obtained by dividing the Fixed Portion and such director's Elective
Portion by the fair value of an option for one share of Stock on the terms
set forth herein as determined on the date of grant. To
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<PAGE>
determine the fair value, the Board shall apply a generally accepted option
pricing valuation methodology, such as the Black-Scholes model, with such
modifications as it may deem appropriate to reflect the fair value of the
option.
7. Option Price. The price per share at which each option granted under
------------
the Plan to an Eligible Director may be exercised ("Option Price") shall be the
fair market value of a share of Stock (the "Market Price") on the date of grant
of the Option. The Market Price of the Stock on a given date shall be
determined based on (i) the average of the high and low sales prices of the
Stock on such date on the principal national securities exchange or market
system in which the Stock is traded or (ii) if the high and low sales prices are
not available, the fair market value of the Stock as determined by the Committee
(or the Board of Directors, if there is not Committee at the time of option
grant).
8. Terms and Conditions of Options. Each option granted under the Plan
-------------------------------
shall be evidenced by and subject to the terms and conditions of an Option
Agreement in a form approved by the Committee. Each Option Agreement executed
and delivered to an Eligible Director shall contain the following terms and
conditions:
(a) Exercise of Options. Each option shall expire 10 years from the
-------------------
date of grant of such option. The Initial Award shall be exercisable in
four equal annual installments commencing on the first anniversary of the
date of grant. The Annual Award shall be immediately exercisable. All
options granted under Section 6 shall become exercisable immediately
preceding the annual meeting of stockholders after the grant date.
(b) Payment. An option may be exercised from time to time, in whole
-------
or in part, during the period that it is exercisable, by payment of the
Option Price of each share purchased, in cash, or by delivery to the
Company of a number of shares of Stock (provided that any shares acquired
directly from the Company shall have been held by such Eligible Director
for at least 6 months before such delivery) having an aggregate Market
Price of not less than the aggregate Option Price. Payment of the Option
Price may also be made by the delivery of an irrevocable undertaking by a
broker to pay the Option Price from the proceeds of the sale of the shares
subject to the option being exercised
(c) Transfer Restrictions. The shares of Stock issued upon exercise
---------------------
of an option granted under this Plan will be acquired for investment and
not with a view to distribution thereof unless there shall be an effective
registration statement under the Securities Act of 1933, as amended (the
"1933 Act"), with respect thereto. In the event that the Company, upon the
advice of counsel, deems it necessary to list upon official notice of
issuance shares to be issued pursuant to the Plan on a national securities
exchange or to register under the 1933 Act or other applicable federal or
state statute any shares to be issued pursuant to the Plan, or to qualify
any such shares for
-3-
<PAGE>
exemption from the registration requirements of the 1933 Act under the
Rules and Regulations of the Securities and Exchange Commission or for
similar exemption under state law, then the Company shall notify each
Eligible Director to that effect and no shares of Stock subject to an
option shall be issued until such registration, listing or exemption has
been obtained. The Company shall make prompt applicable for any such
registration, listing or exemption pursuant to federal or state law or
rules of such securities exchange which it deems necessary and shall make
reasonable efforts to cause such registration, listing or exemption to
become and remain effective. The shares of Stock issued on exercise of the
option shall be subject to any restrictions on transfer then in effect
pursuant to the Articles of Organization or By-laws of the Company.
(d) Non-Transferability. Each option granted under the Plan by its
-------------------
terms shall not be transferable by the optionee otherwise than by will or
by the laws of descent and distribution, or pursuant to a qualified
domestic relations order (as defined in Section 414(p) of the Code), except
that an optionee may transfer all or any portion of an option to a member
of his/her immediate family or to a trust or other entity, the sole
beneficiaries of which are the optionee or members of his/her immediate
family. (For purposes of this Plan, "immediate family" shall be defined as
determined by the Board.) Any option granted under this Plan shall only be
exercised during the lifetime of the optionee by such optionee, by the
transferee pursuant to a qualified domestic relations order or by any
person to whom the optionee is permitted to transfer the option.
(e) Termination of Directorship. Nothing in this Plan or in any
---------------------------
Option Agreement shall confer upon any Eligible Director the right to
continue as a director of the Company. An Eligible Director's right to
participate in the Plan shall automatically terminate if and when such
Director becomes an employee of the Company. Each Option shall terminate
and may no longer be exercised if the Eligible Director ceases to provide
services to the Company in accordance with the following provisions:
(i) If an Eligible Director's service terminates for any reason
other than death, disability, resignation or retirement, options that
he holds will terminate.
(ii) If an Eligible Director's service terminates for death,
disability, resignation or retirement, any option that is not
exercisable will terminate and any option that is exercisable at the
time of termination may be exercised by him or his executor,
administrator or the person or persons to whom rights under the option
shall pass by will or the applicable laws of descent and distribution
at any time within 12 months after the date of death, but in no event
after the expiration of the option.
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<PAGE>
9. Adjustment Provisions.
---------------------
(a) Recapitalizations. If, through or as a result of any merger,
-----------------
consolidation, sale of all or substantially all of the assets of the
Company, reorganization, recapitalization, reclassification, stock
dividend, stock split, reverse stock split or other similar transaction,
(i) the outstanding shares of Common Stock are increased or decreased or
are exchanged for a different number or kind of shares or other securities
of the Company, or (ii) additional shares or new or different shares or
other securities of the Company or other non-cash assets of the Company are
distributed with respect to such shares of Common Stock or other
securities, an appropriate and proportionate adjustment may be made in (x)
the number and kind of shares reserved for issuance under the Plan, (y) the
number and kind of shares or other securities subject to any then
outstanding options under the Plan, and (z) the price for each share
subject to any then outstanding options under the Plan, without changing
the aggregate purchase price as to which such options remain exercisable.
In the event of any other extraordinary dividend or distribution, whether
in stock, cash or other property, or a spinoff, split up or other
extraordinary transaction, the number of shares issuable under this Plan
shall be subject to such adjustment as the Committee or the Board may deem
appropriate, and the number of shares issuable pursuant to any option
theretofore granted (whether or not then exercisable) and the exercise
price of such option shall be subject to such adjustment as the Committee
or the Board may deem appropriate with a view toward preserving the value
of such option.
(b) Mergers, etc. In the event of a consolidation or merger in which
-------------
the Company is not the surviving corporation (other than a consolidation or
merger in which the holders of Stock acquire a majority of the voting stock
of the surviving corporation) or which results in the acquisition of
substantially all the Company's outstanding Stock by a single person or
entity or by a group of persons and/or entities acting in concert, or in
the event of a sale or transfer of substantially all of the Company's
assets or a dissolution or liquidation of the Company, all options
hereunder will terminate; provided, that 20 days prior to the effective
date of any such merger, consolidation, sale, dissolution, or liquidation,
all options outstanding hereunder that are not otherwise exercisable shall
become immediately exercisable.
Notwithstanding the foregoing, in the event that a transaction covered
by this Section 9(b) is a merger or consolidation intended to qualify as a
pooling of interests for accounting purposes, then the acquiring or
surviving corporation shall assume, or otherwise provide replacement
options for, all options outstanding under this Plan, with such adjustments
to the number of shares covered by such option and the exercise price
thereof as may be necessary to reflect the exchange ratio provided for in
the merger or consolidation. Such substitute options shall otherwise be on
terms and conditions substantially equivalent to those set forth in this
Plan, shall be immediately exercisable and, except as to Eligible Directors
who become directors of the acquiring or surviving corporation, shall
terminate on the 180th day following the consummation of the
-5-
<PAGE>
merger or consolidation. Options held by Eligible Directors who become
directors of the acquiring or surviving corporation shall be governed,
mutatis mutandis, by the provisions of this Plan and the agreement
evidencing the option surrendered in substitution.
10. Amendment of the Plan.
---------------------
The Board may at any time amend or discontinue the Plan and the Committee
may at any time amend or cancel any outstanding option for the purpose of
satisfying changes in law or for any other lawful purpose, but no such action
shall adversely affect rights under any outstanding option without the holder's
consent.
11. Notice.
------
Any written notice to the Company required by any of the provisions of the
Plan shall be addressed to the Chief Financial Officer of the Company and shall
become effective when it is received.
12. Effective Date and Duration of the Plan.
---------------------------------------
(a) Effective Date. The Plan shall become effective upon approval by
--------------
the shareholders of the Company. Amendments to the Plan shall become
effective when adopted by the Board of Directors.
(b) Termination. Unless earlier terminated pursuant to Section 9, the
-----------
Plan shall terminate upon the date on which all shares available for
issuance under the Plan shall have been issued pursuant to the exercise of
options granted under the Plan.
-6-
<PAGE>
DETACH HERE
PROXY
RENAISSANCE WORLDWIDE, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY FOR
ITS ANNUAL MEETING TO BE HELD MAY 28, 1998
The undersigned appoints Robert E. Foley and Richard L. Bugley, and each of
them, as proxies, each with the power of substitution, and authorizes them to
represent and vote all shares of Common Stock of Renaissance Worldwide, Inc.
held by the undersigned at the Annual Meeting of Stockholders to be held at the
offices of Ropes & Gray, One International Place, 36th Floor, Boston,
Massachusetts 02110 at 10:00 a.m. (local time), on Thursday, May 28, 1998, and
at any adjournments thereof for the purposes set forth on the reverse side. The
undersigned instructs such proxies or their substitutes to act on the
following matters as specified by the undersigned, and authorizes such proxies
or their substitutes to act on the following matters as specified by the
undersigned, and authorizes such proxies to vote in such other matters that may
properly come before the meeting in the discretion of the proxy so acting. All
previously dated proxies given by the undersigned in respect to said meeting
are hereby revoked.
_____________ _____________
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
_____________ _____________
<PAGE>
DETACH HERE
[X] Please mark
vote as in
this sample.
1. To elect G. Drew Conway as a Class III director.
FOR WITHHELD ABSTAIN
[_] [_] [_]
FOR AGAINST ABSTAIN
2. To approve an increase in the [_] [_] [_]
number of shares of common stock
available for issuance under the
Company's 1996 Stock Plan.
3. To approve amendments to the [_] [_] [_]
Company's 1998 Employee Stock
Purchase Plan.
4. To approve the adoption of the [_] [_] [_]
1998 Directors Stock Plan.
5. To transact any other business that may properly come
before the meeting or any adjournment(s) thereof.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT [_]
Note: Please sign exactly as name appears on this card and date. Where
shares are held jointly, both holders should sign. When signing as attorney,
executor, administrator, trustee, or guardian please give full title as
such. If corporation, please sign in full corporate name and indicate the
signer's office. If a partnership, sign in partnership name.
Signature_________________________ Date:______________
Signature_________________________ Date:______________
