SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
ENGEX, INC.
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(Name of Registrant as Specified In Its Charter)
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(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)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*
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4) Proposed maximum aggregate value of transaction:
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[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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<PAGE>
ENGEX, INC.
44 WALL STREET
NEW YORK, NEW YORK 10005
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JANUARY 6, 1998
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To the Stockholders of Engex, Inc.:
The Annual Meeting of Stockholders of Engex, Inc. will be held on Tuesday,
January 6, 1998, at 9:30 A.M. at the offices of D.H. Blair Investment Banking
Corp., 44 Wall Street, New York, New York.
The following subjects will be considered and acted upon at the Meeting:
(1) Election of four directors;
(2) Ratification of the selection of Grant Thorton LLP as independent
public accountants of Engex, Inc. for the fiscal year ending September 30,
1998;
(3) Transaction of such other business as may properly come before the
Meeting or any adjournment or adjournments thereof.
The Directors unanimously recommend the election as directors of the
nominees named in the Proxy Statement, and ratification of the selection of
Grant Thorton LLP as independent public accountants. Stockholders of record at
the close of business on November 18, 1997 will be entitled to vote at the
Meeting and at any adjournments thereof.
By Order of the Board of Directors
DAVID NACHAMIE,
Secretary
November 21, 1997
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Please fill in, date and sign the Proxy Card for the shares of Engex, Inc.
held by you and return it in the envelope provided so that your vote can be
recorded whether or not you plan to attend. No postage is required if mailed in
the United States.
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<PAGE>
ENGEX, INC.
44 WALL STREET
NEW YORK, NEW YORK 10005
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PROXY STATEMENT
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This statement is furnished in connection with the solicitation by the
Board of Directors (the "Board") of Engex, Inc. (the "Fund"), a Delaware
corporation, of Proxies to be voted at the Annual Meeting of Stockholders to be
held January 6, 1998 (the "Meeting"), and any and all adjournments thereof, for
the purposes set forth in the accompanying Notice of Annual Meeting dated
November 21, 1997. This proxy statement is being mailed to stockholders on or
about November 21, 1997, and is accompanied by an Annual Report with respect to
the Fund's fiscal year ended September 30, 1997. The Fund's Annual Report for
the Fund's fiscal year ended September 30, 1997 will be furnished without charge
upon request by calling Bruce Berger, 44 Wall St., New York, N.Y. at
1-800-999-0015.
All Proxies which have been properly executed and received in time will be
voted at the meeting in accordance with the instructions thereon. Any
stockholder executing a Proxy may revoke it in writing by execution of another
Proxy or by any other legal method at any time before the shares subject to the
Proxy are voted at the Meeting. The Board recommends that shares be voted, and
if no choice is specified on the Proxy, the shares will be voted FOR the
election as directors of the nominees hereinafter named, FOR the ratification of
the selection of Grant Thorton LLP as independent public accountants, and in the
discretion of the persons named as proxies on such other matters as may properly
come before the Meeting. In order to hold the Meeting, a majority of the Fund's
shares entitled to vote must be present in person or represented by proxy. The
election of the nominees indicated herein to the Board of Directors requires the
affirmative vote of a plurality of the Fund's shares present in person or
represented by Proxy and entitled to vote. Approval of the independent public
accountants requires the affirmative vote of the majority of the Fund's shares
present in person or represented by Proxy and entitled to vote.
Brokers holding shares for beneficial owners must vote those shares
according to specific instructions they receive from the owners. If specific
instructions are not received, however, brokers typically may vote the shares in
their discretion, since, under New York Stock Exchange rules, brokers have
discretionary authority to vote on certain routine matters, including the
proposals set forth in this Proxy Statement. "Broker non-votes" and abstentions
will be counted for purposes of determining whether a quorum is present.
Abstentions are counted among the shares entitled to vote on a proposal, and
therefore have the same effect as votes against a proposal. Broker non-votes are
treated as shares that are not entitled to vote, and thus will not be counted in
determining whether the proposal to ratify the Fund's independent public
accountants has been approved.
In the event that a quorum is present but sufficient votes in favor of a
proposal have not been received by the time scheduled for the Meeting, the
persons named as proxies may propose one or more adjournments of the Meeting in
order to permit further solicitation of proxies. The persons named as proxies
will vote in favor of such an adjournment
<PAGE>
if they determine that such adjournment and additional solicitation is
reasonable and in the interests of the Fund's stockholders.
As of November 18, 1997, there were issued and outstanding 977,223 shares
of the common stock, par value $.10 per share, of the Fund, which is the only
class of capital stock of the Fund. Stockholders will be entitled to one vote
for each share held. Only holders of record of such shares at the close of
business on November 18, 1997, will be entitled to vote at the Meeting.
The Fund will pay the cost of preparing, assembling and mailing the
materials in connection with solicitation of Proxies, and will reimburse brokers
and other nominees for their reasonable expenses in connection therewith. In
addition to solicitation by use of the mails, certain officers and directors of
the Fund and officers, directors and personnel of D.H. Blair Investment Banking
Corp. ("Investment Banking Corp.") and American Investors Advisors, Inc.,
formerly D.H. Blair Advisors, Inc. (the "Investment Adviser"), who will receive
no compensation for their services other than their regular salaries, may
solicit the return of Proxies personally or by telephone or telegraph.
2
<PAGE>
ELECTION OF DIRECTORS
At the Meeting, four directors are to be elected to hold office until the
next Annual Meeting of Stockholders and until their respective successors shall
have been chosen and qualified. The following table sets forth the names of the
nominees, all of whom are presently serving as directors of the Fund. All of
these nominees have agreed to serve if elected.
<TABLE>
<CAPTION>
SHARES OF THE FUND
BENEFICIALLY OWNED,
PRINCIPAL OCCUPATION SERVED AS DIRECTLY OR INDIRECTLY, PERCENT
NAME DURING PAST FIVE YEARS DIRECTOR SINCE ON NOVEMBER 18, 1997 OF CLASS
- ---- ---------------------- -------------- ----------------------- --------
<S> <C> <C> <C> <C>
J. Morton Davis* ...... President of the Fund; Chairman, 1968 58,754(1) 6.0%
(Age 67) President, Director and sole
stockholder of D.H. Blair Investment
Banking Corp.; Director and principal
member of a New York Stock Exchange
member. Mr. Davis is also a Director
of Parliament Hill Corp. and Venus
Exploration, Inc.
Judah Feinerman ....... President, Chairman of the Board and 1986 0 0
(Age 72) Director of Judd Associates, Ltd.
(insurance brokerage).
Jerome Fisch .......... Practicing attorney. 1975 300 .03%
(Age 70)
Leonard Toboroff ...... Executive Vice President of Riddell 1993 0 0
(Age 64) Sports, Inc. (sports equipment
manufacturer and distributor)
</TABLE>
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* Mr. Davis is an "interested person" (as defined in the Investment Company
Act of 1940) of the Fund and the Investment Adviser.
(1) Includes 58,754 shares (approximately 6.0% of those outstanding) owned by
Investment Banking Corp. (which Mr. Davis is Chairman and sole
stockholder). The 58,754 shares referred to above do not include 167,429
shares (approximately 17.1% of those outstanding) owned of record by
Rivkalex Corp., 100% of whose outstanding voting securities are owned by
Mr. Davis' wife, Mrs. J. Morton Davis, or the 108,304 shares of the Fund
owned of record by Mrs. Davis (approximately 11.1% of those outstanding).
Mr. Davis disclaims beneficial ownership of such additional shares. See
also "PRINCIPAL STOCKHOLDERS" below.
In the event that any of the nominees named above is unable to serve for
any reason when the election occurs, the accompanying Proxy will be voted for
such person or persons as the Board may recommend.
During the calendar year 1997, there were three meetings of the Board. The
Fund's Board does not have a nominating, compensation or other standing
committee performing similar functions.
3
<PAGE>
During the Fund's fiscal year ended September 30, 1997, the directors
received the following compensation from the Fund:
ESTIMATED
PENSION OR ANNUAL
AGGREGATE RETIREMENT BENEFITS
NAME OF COMPENSATION BENEFITS ACCRUED UPON
DIRECTOR FROM THE FUND AS FUND EXPENSES RETIREMENT
- -------- ------------- ---------------- ----------
J. Morton Davis ............. -0- -0- -0-
Judah Feinerman ............. $3,000 -0- -0-
Jerome Fisch ................ $3,000 -0- -0-
Leonard Toboroff ............ $3,000 -0- -0-
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT STOCKHOLDERS VOTE FOR THE ELECTION OF EACH
NOMINEE TO THE BOARD OF DIRECTORS OF THE FUND
RATIFICATION OR REJECTION OF SELECTION
OF INDEPENDENT PUBLIC ACCOUNTANTS
The Audit Committee is authorized to review proposals of the Fund's
auditors regarding annual audits, recommend the engagement or discharge of the
auditors, review recommendations of such auditors concerning accounting
principles and the adequacy of internal controls and accounting procedures and
practices, to review the scope of the annual audit, to approve or disapprove
each professional service or type of service other than standard auditing
services to be provided by the auditors, and to review and discuss the audited
financial statements with the auditors. Its members are Mr. Leonard Toboroff and
Mr. Judah Feinerman. The Audit Committee may then recommend to the Fund Board
whether to select the Independent Public Accountants for the subsequent fiscal
year. At a meeting held on October 8, 1997, pursuant to the Investment Company
Act of 1940 (the "1940 Act"), the Audit Committee recommended to the Board, and
the Board, including a majority of the Fund's directors who are not "interested
persons" as defined in the 1940 Act (the "non-interested directors"), dismissed
David Berdon & Co. LLP and selected Grant Thorton LLP, who have advised the Fund
that they do not have any direct or material indirect financial interest in the
Fund, to continue as the independent public accountants for the Fund for the
fiscal year ending September 30, 1998. The Board considered the possible effect
on the independence of Grant Thorton LLP, as independent public accountants for
the Fund as a result of the non-audit services rendered and to be rendered by
them, and has concluded that their independence would not be impaired. This
selection is being submitted for ratification by the stockholders. David Berdon
& Co. LLP provided both audit services (examination of the Fund's financial
statements and review of certain of the Fund's filings with the Securities and
Exchange Commission) and non-audit services (review and research related to the
Fund's Federal taxation) during the fiscal year ended September 30, 1997. The
fees for the non-audit services provided amounted to approximately 25% of the
fees paid by the Fund to David Berdon & Co. LLP during such fiscal year. The
principal accountant's report on the financial statements by David Berdon & Co.
LLP for the past two fiscal years has not contained an adverse opinion, or a
disclaimer of opinion, or been qualified or modified as to uncertainty, audit
scope, or accounting principles. Further, during the past two fiscal years,
there were not any disagreements with David Berdon & Co. LLP on any matter of
accounting principles or practices, financial statement disclosure or auditing
scope or procedures, which if not resolved to the satisfaction of David Berdon &
Co. LLP, would have caused them to make reference to the subject matter of the
disagreements in connection with its report. All professional services rendered
by David Berdon & Co. LLP during such fiscal year were furnished at customary
rates and terms. A representative of Grant Thorton LLP is expected to be present
at the Meeting and will be given an opportunity to ask and respond to questions
and to make such statements as he considers appropriate. A representative of
David Berdon & Co. LLP will not be present at the meeting.
4
<PAGE>
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS
THAT STOCKHOLDERS VOTE FOR THE RATIFICATION OF
THE SELECTION OF GRANT THORTON LLP AS INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS FOR THE FUND
MANAGEMENT OF THE FUND
The Investment Adviser was organized in 1985 and serves as the investment
adviser to the Fund pursuant to an Investment Advisory Agreement, dated January
10, 1986 (the "Agreement"). The Agreement was approved by the Fund's
stockholders at a meeting held on February 19, 1986 and was last approved by the
directors of the Fund, including a majority of the directors who were not
"interested persons" of any party to the Agreement, by vote cast in person at a
meeting held on January 8, 1997. Until February 1, 1993, the Investment Adviser
also served as investment adviser to American Investors Growth Fund, Inc.,
American Investors Income Fund, Inc., and American Investors Money Fund, Inc.
The Investment Adviser is wholly-owned by J. Morton Davis. Mr. Davis, President
and Director of the Fund, is also President, Chief Executive Officer and
Chairman of the Board of the Investment Adviser and a principal member of a New
York Stock Exchange member. See also the discussion of shares beneficially owned
by Mr. Davis under "ELECTION OF DIRECTORS" above and "PRINCIPAL STOCKHOLDERS"
below. David Nachamie, Secretary of the Fund, is also Senior Vice President,
Treasurer and a Director of the Investment Adviser. Martin A. Bell, Assistant
Secretary of the Fund, is also Vice Chairman, General Counsel and Secretary of
the Investment Adviser. Brian A. Wasserman, Treasurer of the Fund, is also
Senior Vice President and Chief Financial Officer of the Investment Adviser. The
address of Investment Banking Corp., Mr. Davis, Mr. Nachamie, Mr. Bell and Mr.
Wasserman is 44 Wall Street, New York, New York 10005. The Investment Adviser
maintains offices at the same address.
PRINCIPAL STOCKHOLDERS
The following table sets forth information with respect to any person
(including for this purpose a "group" which consists of two or more persons
acting as a partnership, limited partnership, syndicate or other group for the
purpose of acquiring, holding, or disposing of securities of the Fund) known to
the Fund to be the beneficial owner of more than five percent (5%) of the Fund's
outstanding voting securities:
<TABLE>
<CAPTION>
(1) (2) (3) (4)
AMOUNT AND NATURE
OF BENEFICIAL PERCENT OF
NAME AND ADDRESS OWNERSHIP CLASS
TITLE OF CLASS OF BENEFICIAL OWNER (NOVEMBER 18, 1997) (NOVEMBER 18, 1997)
-------------- ------------------- ------------------- -------------------
<S> <C> <C> <C>
Common Stock (par value $.10) ....... Mr. J. Morton Davis 58,754(1) 6.0%
44 Wall Street
2nd Floor
New York, N.Y. 10005
Mrs. J. Morton Davis 275,733(2) 28.2%
c/o Rivkalex Corp.
44 Wall St.
2nd Floor
New York N.Y. 10005
</TABLE>
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(1) Includes 58,754 shares owned of record by Investment Banking Corp. See note
(1) to "ELECTION OF DIRECTORS" on page 3.
(2) Includes 167,429 shares owned of record by Rivkalex Corp., 100% of whose
outstanding voting securities are owned by Mrs. Davis.
5
<PAGE>
All of the directors and officers of the Fund, as a group, own of record
and beneficially 400 shares of the Fund (approximately .04% of those
outstanding), in addition to which Mr. Davis beneficially owns 58,754 shares
(approximately 6.0% of those outstanding) held by Investment Banking Corp.
Investment Banking Corp., which holds 58,754 shares (approximately 6.0% of
those outstanding), has informed the Fund that it intends to vote such shares in
favor of all proposals submitted by Management and scheduled to come before the
Meeting.
Mr. Davis disclaims beneficial ownership of all shares other than those
held by Investment Banking Corp. Mrs. Davis disclaims beneficial ownership
of all shares other than those held by her personally and those held by
Rivkalex Corp.
Mr. Davis and Mrs. Davis may be in a position to control the outcome of the
Meeting and approval or rejection of the various proposals specified above if
they act in concert.
SUPPLEMENTAL INFORMATION
The executive officers of the Fund, each of whom serve at the pleasure of
the Board, are as follows: J. Morton Davis (age 67), who has served as President
of the Fund since its inception, and whose principal occupation is described
above under "ELECTION OF DIRECTORS"; David Nachamie (age 67), who has served as
Treasurer of the Fund from 1976 through 1993 and also as Secretary since January
7, 1981, and whose principal occupation has been as Treasurer of Investment
Banking Corp. since 1992 and who previously served as comptroller of D.H. Blair
& Co., Inc. for 10 years; Brian A. Wasserman (age 32), who has served as
Treasurer of the Fund since 1993, and whose principal occupation for the past
four years has been as Senior Vice President and Chief Financial Officer of
Investment Banking Corp. and who previously served as a certified public
accountant with Coopers & Lybrand for five years.
SHAREHOLDER PROPOSALS FOR 1999 ANNUAL MEETING
Stockholders wishing to have their proposals included in the Fund's Proxy
Statement for the Fund's 1999 Annual Meeting must submit their proposals,
preferably by certified mail, return receipt requested, to the Fund at its
address listed on the first page of this Proxy Statement so that the proposals
are received no later than July 21, 1998.
OTHER MATTERS
As of the date of this Proxy Statement, the Board is not aware of any
matters to be presented for action at the Meeting other than those described
above. Should other business properly be brought before the Meeting, the persons
named in the Proxy have discretionary authority to vote in accordance with their
best judgment.
ENGEX, INC.
Dated: November 21, 1997
6
<PAGE>
ENGEX, INC.
PROXY--SOLICITED BY THE BOARD OF DIRECTORS (SEE OTHER SIDE)
The undersigned stockholder of ENGEX, INC. ("Fund"), a Delaware
corporation, hereby appoints J. MORTON DAVIS, DAVID NACHAMIE and BRIAN A.
WASSERMAN, and each of them, the true and lawful proxies of the undersigned,
with full power of substitution, to vote on behalf of the undersigned all shares
of the Fund which the undersigned is entitled to vote at the Annual Meeting of
Stockholders of the Fund to be held on January 6, 1998 at 9:30 A.M. and at any
adjournments thereof, hereby revoking any proxy heretofore given with respect to
such shares and the undersigned authorizes and instructs said proxies to vote as
follows:
1. ELECTION OF DIRECTORS
FOR ALL NOMINEES listed below (Except WITHHOLD AUTHORITY to Vote
as marked to the contrary below) [ ] for all nominees listed below [ ]
J. Morton Davis, Judah Feinerman, Jerome Fisch, and Leonard Toboroff
Instruction: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.
___________________________________________________________________
2. RATIFICATION OF THE SELECTION OF GRANT THORTON LLP, as the independent
public accountants for the year ending September 30, 1998.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
<PAGE>
THE SHARES REPRESENTED HEREBY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATIONS HEREIN, BUT WHERE SPECIFICATIONS ARE NOT INDICATED, THIS PROXY
WILL BE VOTED FOR PROPOSALS 1 AND 2, AND IN ACCORDANCE WITH THE DISCRETION OF
THE PROXIES NAMED HEREIN ON ALL OTHER MATTERS (INCLUDING, WITHOUT LIMITATION,
ADJOURNMENTS) PROPERLY COMING BEFORE THE MEETING, ALL IN ACCORDANCE WITH THE
PROXY STATEMENT OF THE FUND, RECEIPT OF WHICH IS HEREBY ACKNOWLEDGED.
(This proxy may be revoked at any time before it is voted at the meeting.)
PLEASE DATE, SIGN AND RETURN IN THE ENCLOSED POSTAGE PAID ENVELOPE. THIS
PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
________________________________________
SIGNATURE
________________________________________
SIGNATURE
________________________________________
DATED
PLEASE SIGN, DATE AND RETURN PROMPTLY
Signature(s) should be exactly as name
or names appearing on this proxy. If
stock is held jointly, each holder
should sign. If signing by attorney,
executor, administrator, trustee or
guardian, please give full title.
