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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------------
FORM 10-KSB
ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
Commission file number 0-16631
BOCA RATON CAPITAL CORPORATION
(Name of Small Business Issuer in Its Charter)
FLORIDA 59-2763089
(State or Other Jurisdiction of Incorporation) (I.R.S. Employer
Identification No.)
6516 Via Rosa, Boca Raton, FL 33433
(Address of Principal Executive Offices) (Zip Code)
Issuer's Telephone Number, Including Area Code: (407) 750-2252
Securities Registered Pursuant to Section 12(b) of the Exchange Act:
None
Securities Registered Pursuant to Section 12(g) of the Exchange Act:
Common Stock, $.001 Par Value
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the issuer was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes X No
---- ----
Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of the issuer's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]
The issuer's revenues for the fiscal year ended December 31, 1995 were
$1,660,920 which consisted of $155,993 in total investment income and $1,504,927
in net realized gain on Investments.
The aggregate market value of the voting stock held by non-affiliates of
the issuer as of March 22, 1996 (computed by reference to the average bid and
asked prices of issuer's Common Stock reported on the OTC Electronic Bulletin
Board on such date) was $410,471. Directors and officers and ten percent or
greater shareholders are considered affiliates for purposes of this calculation
but should not necessarily be deemed affiliates for any other Purpose.
The number of shares outstanding of issuer's Common Stock as of March 22,
1996 was 1,125,270.
--------------------------------------------------
Total pages including exhibits:
Exhibit Index is on page:
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INDEX
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Page
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PART I
ITEM 1 - BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ITEM 2 - PROPERTIES . . . . . . . . . . . . . . . . . . . . . . . . . . 3
ITEM 3 - LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . 3
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
PART II
ITEM 5 - MARKET FOR THE ISSUER'S COMMON EQUITY AND
RELATED SHAREHOLDER MATTERS. . . . . . . . . . . . . . . . . . 6
ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS . . . . . . . . . . . . . 7
ITEM 7 - FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . 9
ITEM 8 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE . . . . . . . . . . . . 9
PART III
ITEM 9 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS . . . . . . . . . . . . . . . . . . . . . . . 10
ITEM 10 - EXECUTIVE COMPENSATION. . . . . . . . . . . . . . . . . . . . 12
ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT . . . . . . . . . . . . . . . . . . . . 14
ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. . . . . . . . 15
ITEM 13 - EXHIBITS, LISTS AND REPORTS ON FORM 8-K . . . . . . . . . . . 17
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PART I
ITEM 1 - BUSINESS
GENERAL
Boca Raton Capital Corporation (the "Company"), a Florida corporation, was
organized in 1987. During the past three years, the Company was a closed-end
management investment company that had elected status as a business development
company ("BDC") under the Investment Company Act of 1940, as amended ("1940
Act"). A BDC must be operated for the purpose of investing in the securities of
certain eligible portfolio companies ("Eligible Portfolio Companies") and
certain bankrupt or insolvent companies and making available significant
managerial assistance ("Making Available Significant Managerial Assistance") to
those investee companies ("Investee Companies") which are qualifying assets
("Qualifying Assets") (as such capitalized terms are defined in the 1940 Act).
As a BDC, the Company although not subject to the provisions of the 1940
Act relating to registered investment companies was nonetheless subject to a
number of provisions under the 1940 Act relating to BDC's. The Board of
Directors of the Company unanimously determined at a meeting held on October 12,
1995, that it would be in the best interest of the Company and its shareholders
to seek shareholder approval to withdraw the Company's election as a BDC in
accordance with the 1940 Act.
The Board determined that a withdrawal of election as a BDC was in the best
interest of the Company because of the Company's then current financial and
operational structure. Specifically, the Company held one portfolio security,
RailAmerica, Inc. ("RailAmerica") common stock, and the balance of its
investments were in cash or cash equivalents. Also, the Company's total assets,
as of September 30, 1995 were approximately $4.1 million. Because of the
relative size of the Company's asset base to its ongoing expenses, the Board
believed the shareholders' return on assets was not sufficient to continue
operations as a BDC. The Board did not believe it was practical to attempt to
raise additional capital for the Company and determined that the Company would
best be suited for a merger with an operating company. Therefore, the Board
authorized the solicitation of shareholder approval to effectuate the withdrawal
at a Special Meeting of shareholders in lieu of the Annual Meeting ("1995
Special Meeting") held on December 15, 1995. At the 1995 Special Meeting, the
shareholders approved the withdrawal of the Company's election of status as a
BDC. The withdrawal became effective upon the Securities and Exchange
Commission's (the "Commission") receipt of the Company's notification of
withdrawal on December 22, 1995. See "Item 4--Submission of Matters to a Vote
of Security Holders."
As of December 31, 1995, the Company's only investment was 375,000 shares
of common stock of RailAmerica. At such date, the Company owned approximately
8% of RailAmerica's outstanding voting stock.
RailAmerica is a diversified, publicly-held transportation holding company
that among other things owns and develops short-line and regional freight
railroads. It currently operates
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four railroads with approximately 300 miles or rail lines in Michigan,
Tennessee, Pennsylvania and Delaware, as well as a distribution services
company, and a transportation equipment finance company. Through its
subsidiary, Kalyn/Siebert, Inc., RailAmerica also manufactures a broad line of
heavy duty specialty truck trailers, marketed throughout the U.S., Mexico and
Canada. RailAmerica also completed the acquisition of Steel City Truck Lines
Limited, a regional motor carrier based in Sault Ste. Marie, Ontario, Canada.
In addition to its investment in RailAmerica, the company received
management fees in 1993 through its interest in Huron Transportation Group, Inc.
("HTG"), which was organized to act as a management company for RailAmerica's
subsidiaries and other railroad companies. The Company's 50% ownership of the
issued and outstanding common stock of HTG was assigned to its former President,
Gary O. Marino, in connection with the termination of his employment agreement,
effective September 30, 1993.
By the end of the second quarter of fiscal 1993, the Company had disposed
of each of its investments except for its holdings of RailAmerica equity
securities. During the two years prior thereto, the Company was an
entrepreneurial holding company that sought to acquire equity interests in, and
provide management expertise to, established operating companies. In addition
to its investment in RailAmerica, the Company had owned interests in Mariner
Venture Capital Corp. ("Mariner Venture"), a small business investment company
("SBIC") licensed by the U.S. Small Business Administration; Boca Raton Athletic
Club, Inc., a swim and racquet club ("BRAC"); and Continental Business Forms,
Inc., a business forms printer ("Continental"). The Company divested itself of
its interests in BRAC and Continental in 1992, and it terminated the SBIC
license of Mariner Venture in 1993. Mariner Venture is currently inactive and
the Company does not intend to make any future investments through Mariner
Venture.
PRIVATE PLACEMENT
In June 1993, the Company completed a private placement (the "1993 Private
Placement") of 828,346 shares of its common stock, $.001 par value per share
("Common Stock"), to private investors, including certain individuals who were
officers and directors of the Company as of June 1993, at $2.20 per share
(adjusted for a one-for-ten reverse stock split effected in June 1993).
Josephthal Lyon & Ross Incorporated ("Josephthal"), the Company's placement
agent in connection with the 1993 Private Placement, was paid approximately
$166,000 in placement agent fees. Josephthal's placement agent fees for the
1993 Private Placement equalled 5% of the funds raised from the Company's
officers and directors and 10% of all other funds raised. This fee arrangement
was consistent with placement fees received by Josephthal in similar
transactions.
TERMINATED MERGER
On June 30, 1994, the Company entered into an Agreement and Plan of Merger
with Weitzer Homebuilders Incorporated ("WHB"), WHB Merger Sub, Inc. ("Sub"),
Harry Weitzer and certain corporations controlled by Harry Weitzer
(collectively, the "Weitzer Entities"). In connection with the proposed merger
which was not consummated, the Company in March 1994 paid Josephthal a $150,000
fee pursuant to a financial consulting agreement dated March 21,
2
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1993. The Weitzer Entities terminated the proposed merger on December 23, 1994,
and Josephthal returned the $150,000 fee to the Company. On June 30, 1994,
consistent with the Company's investment policies, the Company extended a one-
year loan (the "Weitzer Loan") to Weitzer Financial, Inc., an entity controlled
by Harry Weitzer. The Weitzer Loan was in the principal amount of $500,000 with
an interest rate equal to the prime rate plus 1%. The principal, and the
accrued interest thereon, of the Weitzer Loan was repaid in July 1995. See
"Item 12 -- Certain Relationships and Related Transactions."
EMPLOYEES
As of December 31, 1995, the Company had no full time employees. The
Company's Chief Executive Officer and President and Chief Financial Officer,
Secretary and Treasurer provided their services to the Company on a consulting
basis. See "Item 12 -- Certain Relationships and Related Transactions."
ITEM 2 - PROPERTIES
The Company's corporate offices are temporarily located at 6516 Via Rosa,
Boca Raton, Florida 33433. This office space is made available to the Company
by Franklyn B. Weichselbaum, its Chief Financial Officer, Secretary and
Treasurer, at no cost. The Company does not own, lease or occupy any other
properties.
ITEM 3 - LEGAL PROCEEDINGS
The Company is not a party to any pending legal proceedings.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fourth quarter of the fiscal year ended December 31, 1995, (i)
the election of two Class I directors, (ii) the withdrawal of the Company's
election of status as a BDC under the 1940 Act and (iii) the appointment of
Coopers & Lybrand L.L.P. as the Company's independent auditors for the 1995
fiscal year were submitted to the vote of security holders at the 1995 Special
Meeting. On December 15, 1995, the 1995 Special Meeting was held and the
shareholders (i) elected Ronald L. Miller and Alan H. Weingarten as Class I
directors (ii) approved the withdrawal of the Company's election of status as a
BDC and (iii) approved the appointment of Coopers & Lybrand L.L.P. as the
Company's independent auditors for the 1995 fiscal year. The term of Robert H.
Arnold as a Class II director extends until the date of the 1996 annual meeting
of shareholders. The terms of Alan L. Jacobs and C. Lawrence Rutstein as Class
III directors extend until the date of 1997 annual meeting of shareholders. The
terms of Alan H. Weingarten and Ronald L. Miller as Class I directors extend
until the date of the 1998 annual meeting of shareholders.
3
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The record date for the 1995 Special Meeting was the close of business on
November 10, 1995. On that date, the Company had 1,125,270 shares of Common
Stock outstanding. There were 669,315 shares present in person or represented
by proxy at the 1995 Special Meeting. The shares present in person or
represented by proxy were voted as follows:
PROPOSAL I: Election of Class I Directors
In Favor Withheld
-------- --------
Ronald L. Miller 661,322 7,993
Alan H. Weingarten 661,329 7,986
PROPOSAL II: Withdrawal of Election of Status as a Business Development Company
under the Investment Company Act of 1940
In Favor Against Abstained Unvoted
-------- ------- --------- -------
500,569 790 705 166,851
PROPOSAL III: Appointment of Coopers & Lybrand L.L.P. as the Company's
independent auditors for the 1995 fiscal year
In Favor Against Abstained Unvoted
-------- ------- --------- -------
668,046 33 106 1,130
There were no broker non-votes or abstentions in connection with Proposal I
at the 1995 Special Meeting. There were an aggregate of 167,475 and 1,236
broker non-votes and abstentions in connection with Proposals II and III,
respectively, at the 1995 Special Meeting. Broker non-votes were treated as
shares present and entitled to vote at the 1995 Special Meeting for purposes of
determining whether a quorum was present. However, broker non-votes were not
considered as votes cast at the 1995 Special Meeting. In accordance with the
1940 Act, the withdrawal of the Company's election of status as a BDC was
effective upon the Commission's receipt of the Company's notification of
withdrawal on December 22, 1995.
During the first quarter of fiscal year 1996, the approval of a special
cash distribution (the "Special Distribution") of $2.25 per share of common
stock of the Company, $.001 par value per share ("Common Stock"), payable out of
the Company's capital surplus, on each share of the Common Stock outstanding of
record at the close of business on January 11, 1996 was submitted to a vote of
security holders at a special meeting (the "1996 Special Meeting") of
shareholders held on February 29, 1996. At the 1996 Special Meeting, the
shareholders approved the Special Distribution. The Special Distribution was
paid by the Company on March 11, 1996.
4
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The record date for the 1996 Special Meeting was the close of business on
January 11, 1996. On that date, the Company had 1,125,270 shares of Common
Stock outstanding. There were 941,612 shares present in person or represented
by proxy at the 1996 Special Meeting. The shares present in person or
represented by proxy were voted as follows:
PROPOSAL -- Special Distribution
In Favor Against Abstained Unvoted
-------- ------- --------- -------
940,916 85 611 None
There were an aggregate of 611 broker non-votes and abstentions. Broker
non-votes were treated as shares present and entitled to vote at the 1996
Special Meeting for determining whether a quorum was present. However, broker
non-votes were not considered as votes cast at the 1996 Special Meeting.
5
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PART II
ITEM 5 - MARKET FOR THE ISSUER'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
As of January 14, 1993, the Company did not meet the requirements for
continued inclusion of its Common Stock on the Nasdaq Small Cap Market
("Nasdaq"), in particular the minimum capital requirements requiring $1.0
million of capital and surplus. As a result, as of that date, the Company's
Common Stock was no longer authorized for quotation on Nasdaq and is instead
quoted on the OTC Electronic Bulletin Board.
The quarterly high and low bid prices for the Company's Common Stock are
set forth below and are based upon such prices as reported on the OTC Electronic
Bulletin Board thereafter. The Company believes that the market coverage and
liquidity for the Common Stock and the ability of a shareholder to sell at
favorable prices under favorable commission structures has been adversely
affected. The prices set forth below are not necessarily indicative of the
liquidity of the trading market nor for market trades for a large number of
shares. Such over-the-counter market quotations reflect inter-dealer prices,
without retail mark-ups, mark-downs or commissions, and may not represent actual
transactions. Moreover, on March 11, 1996, the Company paid the Special
Distribution on each share of Common Stock outstanding of record at the close of
business on January 11, 1996. The impact, if any, of the Special Distribution
on the bid prices for the Company's Common Stock is not reflected in the prices
set forth in the chart below.
Quarter Ending
- --------------
1994 High Bid Low Bid
- ---- -------- -------
March 31 . . . . . . . . . . . . . . . . . . . . . $ 4 1/4 $ 1 1/2
June 30. . . . . . . . . . . . . . . . . . . . . . $ 3 1/4 $ 1 3/4
September 30 . . . . . . . . . . . . . . . . . . . $ 4 $ 1 1/2
December 31 . . . . . . . . . . . . . . . . . . . $ 2 3/4 $ 2
Quarter Ending
- --------------
1995
- ----
March 31 . . . . . . . . . . . . . . . . . . . . . $2 $1 1/2
June 30. . . . . . . . . . . . . . . . . . . . . . $2 1/4 $1 1/2
September 30 . . . . . . . . . . . . . . . . . . . $2 $1 1/2
December 31. . . . . . . . . . . . . . . . . . . . $2 1/4 $1 1/4
On March 22, 1996 each of the high and low bid price for the Company's
Common Stock was $.625, respectively.
6
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HOLDERS OF COMMON STOCK
As of March 22, 1996, there were approximately 614 holders of record of the
Company's Common Stock and 1,125,270 shares of Common Stock outstanding.
DIVIDENDS
On March 11, 1996, the Company paid a special cash distribution (the
"Special Distribution") of $2.25 per share on each share of Common Stock
outstanding of record on January 11, 1996. The special cash distribution was
declared, by the Board of Directors, subject to shareholder approval, on January
11, 1996. The Company's shareholders approved the Special Distribution at the
1996 Special Meeting held on February 29, 1996. See "Item 4 --Submission of
Matters to a Vote of Security Holders." The payment by the Company of
dividends, if any, in the future rests within the discretion of its Board of
Directors, subject to shareholder approval, and will depend upon, among other
things, the Company's earnings, its capital requirements and its financial
condition, as well as other relevant factors. Except for the Special
Distribution, the Company has not paid any cash dividends since its inception
and does not intend to pay any cash dividends on the Common Stock in the
foreseeable future, but presently intends to retain all earnings, if any, for
use in its business operations.
ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
During 1995, the Company elected to withdraw from its status as a BDC under
the 1940 Act. This election became effective upon the Commission's receipt of
the Company's notification of withdrawal on December 22, 1995. As a result of
this, the Company adopted Statement of Financial Accounting Standards ("SFAS")
No. 115, "Accounting for Certain Investments in Debt and Equity Securities".
Under SFAS No. 115, investments are classified as either held to maturity,
trading or available for sale depending upon whether the investment is a debt or
equity security and management's intent with regards to the investment. The
Company's investment in RailAmerica is considered to be a trading security and
as such is carried at fair value as determined in good faith by the Board of
Directors. The adoption of SFAS No. 115 had no material impact on the results
of operations of the Company because under its status as a BDC in 1994 and for
part of 1995, the Company valued its investments in the same manner as required
under SFAS No. 115.
The Company reported net income of $256,554 and $2,768,593 for the years
ended December 31, 1995 and 1994, respectively. Included in net income for the
year ended December 31, 1994 was $2,624,198 received in satisfaction of a
judgment against the former auditors (See Note 5). Also included in net income
was a net decrease of $792,896 and a net increase of $613,273 in the unrealized
appreciation of investments due primarily to the fluctuations in the fair value
of the Company's investment in RailAmerica for the years ended December 31, 1995
and 1994, respectively. The Company had a realized gain on investments of
$1,504,927 and $67,364 for the years ended December 31, 1995 and 1994,
respectively. The
7
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realized gain on investments for 1995 was due to the sale of 325,000 shares of
RailAmerica and the realized gain on investments for 1994 consisted of a gain on
sales of shares of RailAmerica as well. The balance of income consisted of
investment income of $155,993 and $54,018 less operating expenses of $515,576
and $590,260 for the years ended December 31, 1995 and 1994, respectively.
The investment income of $155,993 for the year ended December 31, 1995
consisted primarily of interest income. This is compared to investment income
of $54,018 for the year ended December 31, 1994. This increase was primarily
due to an increase in the amount of cash available for investment and the
Company's decision to invest in certificates of deposits rather than money
market accounts.
Operating expenses for the year ended December 31, 1995 primarily consisted
of general and administrative expenses of $172,448, professional fees of
$142,599, and interest expense of $200,529. Such expenses for the comparable
period of 1994 consisted of general and administrative expenses of $136,733,
professional fees of $291,903, $34,143 of interest expense and discontinued
merger costs of $127,481. The increase of $35,715 in general administrative
expenses is primarily due to expenses of approximately $41,000 in connection
with obtaining insurance coverage for directors and officers liability and
additional costs for Board of Directors meetings and proxy costs. Professional
fees decreased $149,304 primarily due to the costs incurred in 1994 associated
with the proposed merger and the receivership (See Notes 8 and 9). Interest
expense increased $166,386 due to the Company's adjusting its cumulative
interest accrual on the bank debt outstanding to the full defaulted rate (See
Note 3). The discontinued merger costs in 1994 relate to the termination of the
definitive merger agreement that the Company had entered into with the Weitzer
Entities (See Note 8).
LIQUIDITY AND CAPITAL RESOURCES
The Company had $2,900,888 in cash and cash equivalents and total
liabilities of $714,249 at December 31, 1995. The Company had no long term
liabilities. On March 11, 1996, the Company paid a special cash distribution,
out of capital surplus, in the aggregate amount of approximately $2,530,000. As
a result, cash and stockholders' equity were reduced by the same amount.
At December 31, 1995, the Company did not maintain lines of credit, and
none are anticipated. The Company's only material asset other than cash and
cash equivalents consisted of 375,000 unregistered shares of RailAmerica common
stock which may be sold in accordance with Rule 144 of the Securities Act of
1933, as amended (the "Securities Act"), provided however, that these shares are
subject to a contractual restriction on transfer. It is anticipated that this
restriction will be released in the upcoming year although there can be no
assurance that the conditions therefor will be satisfied. The Company does,
however, have the right to pledge such restricted shares. As of December 31,
1995, these shares of RailAmerica common stock had an approximate value of
$1,089,000. Depending on market conditions, it is Company's current intention
to sell these shares over the next year if the contractual restriction on
transfer of the shares is eliminated.
8
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ITEM 7 - FINANCIAL STATEMENTS
The financial statements required by this Item, the accompanying notes
thereto and the report of independent accountants are included as part of this
Form 10-KSB and immediately follow the signature page of this Form 10-KSB.
ITEM 8 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
9
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PART III
ITEM 9 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
THE BOARD OF DIRECTORS
The following table sets forth information with respect to the directors of
the Company.
Director
Name Age Position Since
---- --- -------- --------
Alan L. Jacobs(1) 54 Chief Executive Officer, 1995
President and Director
Robert H. Arnold(2) 52 Director 1995
Ronald L. Miller(3) 52 Director 1995
C. Lawrence Rutstein(1)(4) 51 Director 1995
Alan H. Weingarten(3)(4) 55 Director 1995
______________
(1) Class III Director.
(2) Class II Director.
(3) Class I Director.
(4) Member of Audit Committee.
In accordance with Article VI, Section 1 of the Company's Amended and
Restated Articles of Incorporation, the Board of Directors of the Company is
divided into three classes, designated Class I, Class II and Class III. The
current term of Class I directors extends to the 1998 annual meeting of
shareholders, that of Class II extends to the 1996 annual meeting and that of
Class III to the 1997 annual meeting. Each class, upon election, serves for a
three-year term. The background of each member of the Board of Directors is set
forth below:
Alan L. Jacobs was elected a director of the Company in February 1995. Mr.
Jacobs had previously served as a director of the Company from July 1993 to
September 9, 1994; as the Chairman of the Board of the Company from November
1993 to September 9, 1994 and became President and Chief Executive Officer of
the Company in November 1993. Since January 1996 to the present, Mr. Jacobs
also has been Senior Managing Director of Capital Growth International LLC.
From January 1992 to December 1995, Mr. Jacobs was also an Associate Director of
Investment Banking of Josephthal Lyon & Ross Incorporated. From May 1985 to
December 1991, Mr. Jacobs was Managing Director, Investment Banking, with
Ladenburg Thalmann & Co., Inc., an investment banking firm.
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Robert H. Arnold was elected as a director of the Company in February 1995.
Mr. Arnold is the founder of R.H. Arnold & Co., an investment banking firm, and
has served as the President of R.H. Arnold & Co. since 1989. Mr. Arnold is a
director of R. H. Arnold & Co.; an independent General Partner of Fiduciary
Capital Partners, a U.S. public mezzanine fund; a Managing Director of HC
Capital Partners China, an international investment company; an advisor to
Mezzanine Management Limited, an investment management firm; a director of
Covenant Investment Management, an investment company; a director of Eagle
Finance Corp.; a director of Covenant Holding; a director of Phoenix Four, Inc.,
an investment fund, and a Trustee of the Philadelphia-based Tax-Exempt Housing
Reserve Fund.
Ronald L. Miller was elected as a director of the Company in February 1995.
Mr. Miller is the founder of Miller Advisory Corp., an investment banking firm,
and has served as President of Miller Advisory Group, since 1989. Mr. Miller is
Chairman of the Board of Provider Solutions, Inc., a health care computer
software company; and a director of Pollo Tropical, Inc., a publicly traded
company which operates grilled chicken restaurants.
C. Lawrence Rutstein was elected as a director of the Company in February
1995. Mr. Rutstein has been counsel to the law firm, Ronald Bluestein &
Associates since 1993. Mr. Rutstein has also been the President and Managing
Director of CapQuest Partners, Inc., a private investment banking firm since
November 1995. Mr. Rutstein was the Chairman of The Rittenhouse Group, Inc., a
private consulting company from May 1994 to May 1995. From 1991 to 1993, Mr.
Rutstein was the General Partner and Vice President of Memphis Chicks Baseball
Club, an AA Affiliate of the Kansas City Royals. From 1989 to 1991, Mr.
Rutstein served as Chairman of the Board of Cedar Group, Inc., a publicly traded
company which imports and distributes industrial fasteners.
Alan H. Weingarten was elected as a director of the Company in February
1995. Mr. Weingarten has served as Chief Executive Officer of Alan H.
Weingarten & Associates, Inc., a general management, marketing, product planning
and consulting organization since 1986. Mr. Weingarten is a director of Lumex
Inc., a publicly traded company, and a member of Lumex Inc.'s audit,
compensation and director affairs committees.
EXECUTIVE OFFICERS
The following table sets forth information with respect to the executive
officers of the Company.
Name Age Position Held
---- --- -------------
Alan L. Jacobs 54 Chief Executive Officer and
President
Franklyn B. Weichselbaum 50 Chief Financial Officer, Treasurer
and Secretary
The principal occupation of Mr. Jacobs is discussed above under "The Board
of Directors."
11
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Franklyn B. Weichselbaum has been a consultant to the Company since May
1990; was elected Treasurer and Chief Financial Officer of the Company in
November 1993 and Secretary of the Company in March 1995. Since September,
1995, Mr. Weichselbaum has served as consultant to Schulman & Associates, Inc.
Mr. Weichselbaum served as a consultant to Weitzer Homebuilders Incorporated, a
publicly traded company engaged in the design and construction of single family
residences from October 1994 until August 1995. Mr. Weichselbaum also served as
a consultant to RailAmerica, a publicly held transportation holding company,
from May 1990 to March, 1994.
CERTAIN FILINGS
Section 16(a) of the Exchange Act 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 Commission initial
reports of ownership and reports of changes in ownership of Common Stock and
other equity securities of the Company. Directors, officers and greater than
ten percent stockholders are required by Commission regulation to furnish the
Company with copies of all Section 16(a) forms they file.
Based on a review of such timely filed forms received by it and
representations by persons that would be required to file such forms, the
Company believes that all required filings by current executive officers and
directors have been timely filed, except that Form 4 statements for January 1996
of Messrs. Ronald Miller and C. Lawrence Rutstein were filed late, respectively.
Additionally, the Form 4 statement for December 1995 of Mr. Dan Purjes, a
principal stockholder of the Company, was filed late. The Form 4 statements of
Messrs. Miller, Rutstein and Purjes each reported one transaction.
ITEM 10 - EXECUTIVE COMPENSATION
No executive officer of the Company received more than $100,000 in
compensation for the year ended December 31, 1995. The following table sets
forth the annual and long-term compensation for services in all capacities to
the Company for the years ended December 31, 1995, 1994 and 1993 of the Chief
Executive Officer of the Company.
12
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Other
---------------------
Name and Principal Annual
Position Year Salary ($) Bonus ($) Compensation ($)
- ------------------ ---- ---------- --------- ----------------
<S> <C> <C> <C> <C>
Alan L. Jacobs(1) 1995 $ 30,000 $ - $ -
President and Chief 1994 - - -
Executive Officer 1993 - - -
(from November 1993
to present) and
Chairman of the Board
of Directors (from
November 1993 until
September 9, 1994)
</TABLE>
(1) Mr. Jacobs received no compensation from the Company for his services to
the Company prior to March 1995. Mr. Jacobs' employer, Josephthal, received
$3,000 a month in consulting fees from the Company from March 1993 through
February 1995. See "Item 12 -- Certain Relationships and Related Transactions."
From March 1995 to December 1995, Mr. Jacobs was paid $3,000 per month. As of
January 1996, the Company has agreed to pay Mr. Jacobs $5,000 per month.
DIRECTOR REMUNERATION
Since February 1995, directors have been entitled to receive $1,500 per
meeting attended and reimbursement for certain out-of-pocket expenses for
serving as such. Additionally, members of the Audit Committee have been
entitled to receive $1,500 per meeting attended and reimbursement for certain
out-of-pocket expenses for serving as such.
On January 11, 1996, the Company approved the payment to each director of
the Company of directors fees of $10,000 for services to be rendered as a
director during 1996 and granted 10,000 options to each officer and each non-
officer director of the Company. Each option had an initial exercise price of
$3.00 per share which exceeded the market price per share and the book value per
share of the Company's Common Stock on the date of grant. Each option is
exercisable for four years commencing April 15, 1996 to purchase one share of
Common Stock at an adjusted exercise price of $.75 per share, giving effect to
an adjustment for the payment of the Special Distribution. See Item 4
"Submission of Matters to a Vote of Security Holders."
On January 5, 1994, the Company's By-laws were amended to adopt provisions,
authorized by Florida law, which require the Company to indemnify directors and
officers of the Company against certain liabilities and reasonable expenses
incurred by reason of his/her being or having been a director or an officer of
the Company or for an act alleged to have been committed by such director or
officer in his/her capacity as a director or officer of the Company. All rights
to indemnification and advances shall be deemed to be a contract between the
Company and each indemnified person who serves or served in such capacity at any
time
13
<PAGE>
while such indemnification provisions were in effect and, as such, are
enforceable against the Company. The Company has also obtained director and
officer liability insurance.
ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number of shares and percentage owned of
the Company's Common Stock beneficially owned as of February 29, 1996 by (i)
each person known by the Company to be the beneficial owner of more than five
percent of the Common Stock, (ii) each director of the Company, (iii) each
executive officer named in the summary compensation table set forth above, and
(iv) all officers and directors of the Company as a group.
<TABLE>
<CAPTION>
Name and Address of Number of Percentage
Beneficial Owner(1) Shares Owned
------------------- --------- ----------
<S> <C> <C>
William B.Tanner(2) 165,600 14.7%
2076 Union Avenue
P.O. Box 40769
Memphis, Tennessee 38174
Dan Purjes(3) 123,666 10.9%
c/o Josephthal Lyon & Ross Incorporated
200 Park Avenue, 24 Floor
New York, New York 10166
Alan L. Jacobs(4) 17,562 1.5%
c/o Capital Growth International LLC
777 South Flager Drive
8th Floor West Tower
Palm Beach, Florida 33401
Robert H. Arnold(4) 10,000 *
c/o R.H. Arnold & Co.
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
Ronald L. Miller(4) 10,000 *
c/o Miller Advisory Corp.
2601 Heron Lane N.
Clearwater, Florida 34622
C. Lawrence Rutstein(4) 10,000 *
340 Overlook Lane
Gulph Mills, Pennsylvania 19428
14
<PAGE>
Alan H. Weingarten(4) 17,500 1.5%
c/o Alan H. Weingarten & Associates, Inc.
21759 Club Villa Terrace
Boca Raton, Florida 33433
All officers and directors as a group (6 75,062 6.3%
persons)(5)
</TABLE>
- ----------------------
* Less than 1%.
(1) Unless otherwise indicated, each person listed above has sole voting power
and sole investment power with respect to the shares owned by such person.
(2) Includes (a) 23,000 shares held by WBT Holding Co., Inc., an entity
controlled by Mr. Tanner; (b) 11,500 shares held by Mr. Tanner as custodian for
Weatherly Blake, Mr. Tanner's son; (c) 4,600 shares held by Mr. Tanner as
custodian for William Taylor Tanner, Mr. Tanner's grandson; (d) 11,500 shares
held by Crystal Tanner, Mr. Tanner's daughter; and (e) 11,500 shares held by
William B. Tanner, Jr., Mr. Tanner's son. Mr. Tanner disclaims beneficial
ownership of all of these shares.
(3) Includes (a) 2,500 shares owned by his minor children; (b) 3,000 shares
held in his profit sharing plan account; (c) 1,000 shares held in his individual
retirement account; (d) 35,000 shares owned by Josephthal Holdings, Inc.
("Josephthal Holdings") of which Mr. Purjes is an executive officer, director
and principal shareholder and (e) 11,500 shares owned by the Josephthal Profit
Sharing Plan, of which Mr. Purjes has the authority to appoint and discharge its
trustees. Mr. Purjes disclaims beneficial ownership of the shares held by his
minor children, Josephthal Holdings and the Josephthal Profit Sharing Plan.
(4) Includes 10,000 shares which are issuable upon the exercise of outstanding
options within 60 days of February 29, 1996.
(5) Includes 60,000 shares which are issuable upon the exercise of outstanding
options within 60 days of February 29, 1996.
ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Alan L. Jacobs, President and Chief Executive Officer of the Company, was
also employed by Josephthal from January 1992 to December 1995. In addition,
Dan Purjes, a managing director of Josephthal, is a shareholder of the Company
and Josephthal Holdings, the parent company of Josephthal. The Company and
Josephthal were parties to a financial consulting agreement dated March 2, 1993
pursuant to which the Company paid Josephthal $3,000 a month in consulting fees
from March 1993 until February 1995. The Company paid such monthly fee for
services provided by Josephthal which included advice to, and consulting with,
the Company concerning financial planning, corporate organization and structure,
financial
15
<PAGE>
matters in connection with operation of the business of the Company, private and
public equity and debt financing, acquisitions, mergers and other similar
business combinations, and periodic analysis of the Company's financial
statements. Additionally, Alan Jacobs, the Company's President and Chief
Executive Officer, was not compensated directly by the Company for services
rendered as an officer of the Company prior to March 1995. However, Mr. Jacobs
was compensated by Josephthal. The $3,000 monthly fee is consistent with fees
that Josephthal receives for providing similar financial consulting services to
other small public entities. In addition, the consulting agreement obligated
the Company to pay Josephthal a contingent transaction fee equal to two percent
(2%) of the amount of any financing or value of any transaction in connection
with which Josephthal, at the written request of the Company, renders advisory
services to the Company, but the source of the financing or transaction is not
Josephthal. The Company also was required to pay Josephthal contingent
transaction fees for financings or transactions introduced to the Company by
Josephthal as agreed to on a transaction-by-transaction basis. The consulting
agreement was for a five year term ending December 31, 1997, except that, after
July 1, 1993, the agreement was subject to termination by either party upon
thirty days' prior written notice. In March 1995, the consulting agreement was
terminated by the Company. In addition, as of March 1995, the Company agreed to
pay Mr. Jacobs, as Chief Executive Officer and President, $3,000 a month. In
connection with the terminated merger which was not consummated by and among the
Company, Harry Weitzer, WHB, Sub and the Weitzer Entities, the Company in March
1994 paid Josephthal a $150,000 fee pursuant to the consulting agreement. The
fee charged by Josephthal relating to the terminated merger was calculated after
a review of standard merger and acquisition fee formulas for similar
transactions, and discounted due to the financial consulting agreement. The
Weitzer Entities terminated the proposed merger on December 23, 1994, and
Josephthal returned the $150,000 fee to the Company. On June 30, 1994,
consistent with the Company's investment policies, the Company extended the
Weitzer Loan to Weitzer Financial, Inc., an entity controlled by Harry Weitzer.
The Weitzer Loan was in the principal amount of $500,000 with an interest rate
equal to the prime rate plus 1%. The principal, and accrued interest thereon,
of the Weitzer Loan was repaid in July 1995.
The Company paid Mr. Franklyn Weichselbaum $2,200 per month in consulting
fees from July 1993 until February 1995. The $2,200 per month fee was
negotiated between the Company and Mr. Weichselbaum and was determined by
estimating the amount of time to be provided by Mr. Weichselbaum in connection
with his services as Treasurer and Chief Financial Officer of the Company. In
addition, the Company agreed to pay additional fees to Mr. Weichselbaum for
services provided by Mr. Weichselbaum which the Company believed were not in the
ordinary course of business, such as those rendered in connection with
performing due diligence and other consulting services in connection with the
terminated merger. The Company paid Mr. Weichselbaum an aggregate of $70,000 in
1994 for the consulting services he rendered in connection with the terminated
merger. The amount of this fee was determined based upon the complexity of work
and the amount of time expended by Mr. Weichselbaum. From March 1995 to
December 1995, the Company paid Mr. Weichselbaum, as Secretary, Treasurer and
Chief Financial Officer of the Company, $2,200 per month. As of January 1996,
the Company has agreed to pay Mr. Weichselbaum, $3,500 per month, as Secretary,
Treasurer and Chief Financial Officer of the Company.
16
<PAGE>
ITEM 13 - EXHIBITS, LISTS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed herewith:
3.1 Amended and Restated Articles of Incorporation of the registrant;
incorporated by reference to Exhibit 28.0 of the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1989 (the "1989 10-K").
3.2 Bylaws of the registrant; incorporated by reference to the
Registration Statement on Form S-18 (No. 33-12232-A) filed with the Securities
and Exchange Commission on February 23, 1987 under the name U.S. Tech, Inc. (the
"S-18 Registration Statement").
3.3 Amended Bylaws of the registrant; incorporated by reference to
the Registration Statement on Form 8-A filed with the Securities and Exchange
Commission on March 7, 1988 under the name Mariner Capital Corporation (the "8-A
Registration Statement").
3.4 Amendment to Bylaws of the registrant; incorporated by reference
to Exhibit 2.2 of the Registration Statement on Form N-2 (No. 33-27005) filed
with the Securities and Exchange Commission on February 13, 1989 under the name
Mariner Capital Corporation (the "N-2 Registration Statement").
3.5 Amendment to Bylaws of the registrant; incorporated by reference
to Exhibit 3.6 of the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1988, filed under the name of Mariner Capital Corporation
(the "1988 10-K").
3.6 Amendment to Bylaws of the registrant dated June 3, 1993;
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1992 (the "1992 10-K").
3.7 Warrant Agreement dated as of June 9, 1993 between the registrant
and Josephthal Lyon & Ross Incorporated; incorporated by reference to the
Company's Annual Report on Form 10-KSB for the fiscal year ended December 31,
1993 (the "1993 10-KSB").
3.8 Warrant Agreement dated as of March 10, 1994 between the
registrant and Josephthal Lyon & Ross Incorporated; incorporated by reference to
the Company's 1993 10-KSB.
3.9 Amended Bylaws of the registrant, as amended January 6, 1995;
incorporated by reference to Exhibit 3.9 of the Company's Annual Report on Form
10-KSB for the fiscal year ended December 31, 1994 (the "1994 10-KSB").
4.0 Form of Common Stock Certificate; incorporated by reference to
Exhibit 4 of the N-2 Registration Statement.
4.1 Form of Convertible Note; incorporated by reference to Exhibit
4.1 of the N-2 Registration Statement.
17
<PAGE>
4.2 Form of Trust Indenture; incorporated by reference to Exhibit 5
of N-2 Registration Statement.
4.3 $200,000 Note Payable due November 25, 1995 to Bank of New
England, N.A.; incorporated by reference to Exhibit 4.3 of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1990 (the "1990
10-K").
10.0 Amended and Restated 1988 Stock Option Plan; incorporated by
reference to Exhibit 10.2 of the 1990 10-K.
10.1 Employment Agreement (Gary O. Marino); incorporated by reference
to Exhibit 10.10 of the N-2 Registration Statement.*
10.2 Huron Transportation Group, Inc. Shareholders' Agreement;
incorporated by reference to Exhibit 10.8 of the 1988 10-K.
10.3 Huron Transportation Group, Inc. Executive Management Agreement;
incorporated by reference to Exhibit 10.9 of the 1988 10-K.
10.4 Guaranty of the Company to First of America Bank - Frankenmuth
dated February 17, 1989 regarding HERC indebtedness; incorporated by reference
to Exhibit 10.8 of the 1989 10-K.
10.5 Unconditional and Irrevocable Guaranty of the Company to the Bank
of New England, N.A. dated November 30, 1990 regarding Joint Venture
indebtedness; incorporated by reference to Exhibit 10.10 of the 1990 10-K.
10.6 Amended and Restated Indemnity and Stock Exchange Agreement dated
December 18, 1990 between the Company and Gary O. Marino; incorporated by
reference to Exhibit 10.6 of the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1991 (the "1991 10-K").
10.7 Employment Agreement, dated July 1, 1992, between the Company and
Gary O. Marino*; incorporated by reference to the Company's 1992 10-K.
10.8 Employment Agreement, dated July 1, 1992, between the Company and
Donald D. Redfearn*; incorporated by reference to the Company's 1992 10-K.
10.9 Employment Agreement, dated July 1, 1992, between the registrant
and Irwin J. Newman*; incorporated by reference to the Company's 1992 10-K.
10.10 Financial Consulting Agreement, dated March 2, 1993, between the
Company and Josephthal Lyon and Ross Incorporated; incorporated by reference to
the Company's 1992 10-K.
10.11 Financial Consulting Agreement, dated July 10, 1992, between the
Company and Stenton Leigh Capital Corp.; incorporated by reference to the
Company's 1992 10-K.
18
<PAGE>
10.12 Stock Purchase Agreement, dated July 30, 1992, between Business
Forms Investments, Inc. and the Company; incorporated by reference to Exhibit
No. 2 to the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1992.
10.13 1992 Executive Officer Supplemental Compensation Plan;
incorporated by reference to the Company's 1992 10-K.*
10.14 Termination Agreement, dated November 2, 1993, between the
registrant and Gary O. Marino; incorporated by reference to the Company's 1993
10-KSB.
10.15 Termination Agreement, dated October 8, 1993, between the
registrant and Donald D. Redfearn; incorporated by reference to the Company's
1993 10-KSB.
10.16 Termination Agreement, dated October 19, 1993, between the
registrant and Irwin J. Newman; incorporated by reference to the Company's 1993
10-KSB.
10.17 Loan Agreement between the Company and Weitzer Financial Inc.
dated June 30, 1994; incorporated by reference to Exhibit 10.17 of the Company's
1994 10-KSB.
10.18 Promissory Note of Weitzer Financial Inc. dated June 30, 1994 in
the original principal amount of $500,000; incorporated by reference to Exhibit
10.18 of the Company's 1994 10-KSB.
10.19 Option Agreement, dated as of January 11, 1996, between the
Company and Alan L. Jacobs.
10.20 Option Agreement, dated as of January 11, 1996, between the
Company and Robert H. Arnold.
10.21 Option Agreement, dated as of January 11, 1996, between the
Company and Ronald L. Miller.
10.22 Option Agreement, dated as of January 11, 1996, between the
Company and C. Lawrence Rutstein.
10.23 Option Agreement, dated as of January 11, 1996, between the
Company and Alan H. Weingarten.
10.24 Option Agreement, dated as of January 11, 1996, between the
Company and Franklyn B. Weichselbaum.
21.1 Subsidiaries of the registrant; incorporated by reference to
Exhibit 22.0 of the 1991 10K; incorporated by reference to Exhibit 22.1 of the
Company's 1994 10-KSB.
22.2 Proxy Statement for Special Meeting of shareholders in lieu of
the Annual Meeting on December 15, 1995.
19
<PAGE>
22.3 Proxy Statement for Special Meeting of shareholders on February
29, 1996.
27. Financial Data Schedules.
22.1 Proxy Statement for Special Meeting of shareholders on February
10, 1995; incorporated by reference to Exhibit 22.1 of the Company's 1994 10-
KSB.
99 Consent Order for Preliminary Injunction and Other Ancillary
Relief dated September 6, 1994; incorporated by reference to Exhibit No. 99 to
the Company's report on Form 8-K filed with the Securities and Exchange
Commission on September 20, 1994
99.1 Order granting Receiver's Motion to Approve Status Report,
Approve Election of Board of Directors, Approve Payment of Certain Fees and
Expenses and Approve Dismissal and Discharge of Receiver dated March 14, 1995;
incorporated by reference to Exhibit 99.1 to the Company's report on Form 8-K
filed with the Securities and Exchange Commission on March 24, 1995.
99.2 Status Report of Daniel H. Aronson, Receiver, dated February 27,
1995; incorporated by reference to Exhibit 99.2 to the Company's report on Form
8-K filed with the Securities and Exchange Commission on March 24, 1995.
99.3 Notification of Withdrawal of Election to be subject to Sections
55 through 65 of the Investment Company Act of 1940 filed pursuant to Section
54(c) of the Investment Company Act of 1940.
- ---------------------
* Executive Compensation Plan or Arrangement
(b) No reports on Form 8K were filed during the last quarter of 1995;
however, on January 11, 1996 the Company filed a report on Form 8-K in
connection with the withdrawal of its election of status as a business
development company under the Investment Company of 1940, as amended, and on
March 21, 1996 the Company filed a report on Form 8-K in connection with the
payment of a special cash distribution of $2.25 per share on each outstanding
share of its common stock of record at the close of business on January 11,
1996.
20
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized on March 29,
1996.
BOCA RATON CAPITAL CORPORATION
By: /s/ Alan L. Jacobs
-----------------------------------------
Alan L. Jacobs
President and Chief Executive Officer
21
<PAGE>
The undersigned directors and officers of Boca Raton Capital Corporation
hereby constitute and appoint Alan L. Jacobs and Franklyn B. Weichselbaum and
each of them, with full power to act without the other and with full power of
substitution and resubstitution, our true and lawful attorneys-in-fact with full
power to execute in our name and behalf in the capacities indicated below this
Annual Report on Form 10-KSB and any and all amendments thereto and to file the
same, with all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission and hereby ratify and confirm all
that such attorneys-in-fact, or any of them, or their substitutes shall lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the Registrant and in the capacities indicated on March 29, 1996.
Signatures Title
---------- -----
/s/ Alan L. Jacobs President, Chief Executive Officer
- ----------------------------- and Director (Chief Executive
Alan L. Jacobs Officer)
/s/ Franklyn B. Weichselbaum Chief Financial Officer,
- ----------------------------- Secretary and Treasurer (Principal
Franklyn B. Weichselbaum Financial and Accounting Officer)
/s/ Robert H. Arnold Director
- -----------------------------
Robert H. Arnold
/s/ Ronald L. Miller Director
- -----------------------------
Ronald L. Miller
/s/ C. Lawrence Rutstein Director
- -----------------------------
C. Lawrence Rutstein
/s/ Alan H. Weingarten Director
- -----------------------------
Alan H. Weingarten
22
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
REPORT ON AUDITS OF FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
<PAGE>
INDEX TO FINANCIAL STATEMENTS
PAGES
Report of Independent Accountants F-1
Consolidated Balance Sheet as of December 31, 1995 F-2
Consolidated Statements of Income for the Years Ended
December 31, 1995 and 1994 F-3
Consolidated Statements of Stockholders' Equity
for the Years Ended December 31, 1995 and 1994 F-4
Consolidated Statements of Cash Flows for the Years Ended
December 31, 1995 and 1994 F-5
Notes to Consolidated Financial Statements F-6 - F-12
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Stockholders and the
Board of Directors of Boca Raton Capital Corporation
We have audited the accompanying consolidated balance sheet of Boca Raton
Capital Corporation and Subsidiaries (the "Company") as of December 31, 1995 and
the related consolidated statements of income, stockholders' equity, and cash
flows for each of the two years in the period then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Boca Raton Capital
Corporation and Subsidiaries as of December 31, 1995, and the results of their
operations and their cash flows for each of the two years in the period then
ended in conformity with generally accepted accounting principles.
COOPERS & LYBRAND L.L.P.
Miami, Florida
March 22, 1996
F-1
<PAGE>
<TABLE>
<CAPTION>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1995
<S> <C>
ASSETS
Cash and cash equivalents $ 2,900,888
Portfolio investments at fair value 1,089,375
-------------
Total assets $ 3,990,263
-------------
-------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Notes payable and accrued interest $ 588,029
Accounts payable and accrued expenses 126,220
-------------
Total liabilities 714,249
-------------
Stockholders' equity:
Common stock, $.001 par value; authorized
40,000,000 shares; 1,125,270 shares
issued and outstanding 1,125
Additional paid-in capital 6,534,795
Accumulated deficit (3,259,906)
-------------
Total stockholders' equity 3,276,014
-------------
Total liabilities and stockholders' equity $ 3,990,263
-------------
-------------
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
F-2
<PAGE>
<TABLE>
<CAPTION>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
1995 1994
<S> <S> <S>
Investment income:
Interest $ 126,781 $ 54,018
Other 29,212 0
----------- ----------
Total investment income 155,993 54,018
----------- ----------
Operating expenses:
General and administrative 172,448 136,733
Legal 98,499 230,207
Audit 44,100 61,696
Interest 200,529 34,143
Discontinued merger costs 0 127,481
----------- ----------
Total operating expenses 515,576 590,260
----------- ----------
Operating loss (359,583) (536,242)
----------- ----------
Other income:
Net proceeds from settlement of a lawsuit 0 2,624,198
----------- ----------
Realized and unrealized gain (loss) on investments:
Net realized gain on investments 1,504,927 67,364
Net increase (decrease) in unrealized appreciation of investments (792,896) 613,273
----------- ----------
Net realized and unrealized gain on investments 712,031 680,637
----------- ----------
Income before income taxes 352,448 2,768,593
Income tax expense 95,894 0
----------- ----------
Net income $ 256,554 $2,768,593
----------- ----------
----------- ----------
Net income per common share $ 0.23 $ 2.46
----------- ----------
----------- ----------
Weighted average number of shares 1,125,270 1,125,270
----------- ----------
----------- ----------
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
F-3
<PAGE>
<TABLE>
<CAPTION>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
Shares Par Paid-In Accumulated
Outstanding Value Capital Deficit Total
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Balance, January 1, 1994 1,125,270 $ 1,125 $ 6,534,795 $ (6,285,053) $ 250,867
Net income 0 0 0 2,768,593 2,768,593
Balance, December 31, 1994 1,125,270 1,125 6,534,795 (3,516,460) 3,019,460
Net income 0 0 0 256,554 256,554
------------ ------------ ------------ ------------ ------------
Balance, December 31, 1995 1,125,270 $ 1,125 $ 6,534,795 $ (3,259,906) $ 3,276,014
------------ ------------ ------------ ------------ ------------
------------ ------------ ------------ ------------ ------------
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
F-4
<PAGE>
<TABLE>
<CAPTION>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
1995 1994
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 256,554 $ 2,768,593
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Decrease (increase) in unrealized appreciation of investments 792,896 (613,273)
Gain on sale of investment (1,504,927) (67,364)
Interest accrued but not paid on defaulted note 200,529 24,000
Decrease in other receivables 0 10,000
Increase (decrease) in accounts payable and accrued expenses (203,891) 8,468
------------ ------------
Net cash provided by (used in) operating activities (458,839) 2,130,424
------------ ------------
Cash flows from investing activities:
Proceeds from sale of investment 1,505,469 67,424
Purchase of note receivable 0 (500,000)
Proceeds from note receivable 522,514 0
------------ ------------
Net cash provided by (used in) investing activities 2,027,983 (432,576)
------------ ------------
Cash flows from financing activities:
Principal payments on long-term debt 0 (759,000)
------------ ------------
Net cash used in financing activities 0 (759,000)
------------ ------------
Net increase in cash 1,569,144 938,848
Cash, beginning of year 1,331,744 392,896
------------ ------------
Cash, end of year $ 2,900,888 $ 1,331,744
------------ ------------
------------ ------------
Supplemental disclosures of cash flow information:
Cash paid during the year for interest $ 0 $ 70,736
------------ ------------
------------ ------------
Cash paid during the year for income taxes $ 39,087 $ 0
------------ ------------
------------ ------------
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
F-5
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BUSINESS
Boca Raton Capital Corporation and Subsidiaries (the "Company") was a
non-diversified, closed-end investment company, which had elected and was
granted the status as a Business Development Company ("BDC") under the
Investment Company Act of 1940 (the "1940 Act"). During 1995, the
Company's Board of Directors were of the opinion that the shareholders
return on assets was not sufficient to continue operations as a BDC. As
such, the Company's election to withdraw from its status as a BDC was filed
with the Securities and Exchange Commission and became effective as of
December 22, 1995. It is the Company's current intention to seek to be
merged with an operating company. No material impact to the financial
statements resulted from the Company's change in status.
While a BDC, the Company's primary investment objective had been to seek
long-term capital appreciation by making debt and equity investments in
established and emerging operating companies. In addition, as a secondary
investment objective, the Company sought to provide services to its
investee companies in return for management and transaction fees. The
Company's investments have generally taken the form of equity securities,
usually common stock.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiaries. All material intercompany balances and
transactions have been eliminated in consolidation.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash in money market accounts and
certificates of deposits. All highly liquid investments with a maturity
when purchased of three months or less are considered to be cash
equivalents.
VALUATION OF PORTFOLIO INVESTMENTS
During 1995, the Company adopted Statement of Financial Accounting
Standards ("SFAS") No. 115, "Accounting for Certain Investments in Debt and
Equity Securities". Under SFAS No. 115, investments are classified as
either held to maturity, trading or available for sale depending upon
whether the investment is a debt or equity security and management's intent
with regards to the investment. The Company's investment in RailAmerica
has been classified as trading which calls for the investment to be carried
at fair value and changes in market value be credited or charged to income.
Investments for which market quotations are
F-6
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED:
VALUATION OF PORTFOLIO INVESTMENTS, CONTINUED
readily available are valued at market. In the absence of market
quotations, investments are valued at their fair value as determined in
good faith by the Board of Directors. Due to the inherent uncertainty of
this valuation, these estimates may differ significantly from the values
that would have been used had a ready market for the investments existed.
Although SFAS No. 115 generally does not apply to restricted securities, it
is management's belief that the current restrictions on the resale of the
RailAmerica shares will be removed within the next year. As a result of
this, SFAS No. 115 is applicable. The adoption of SFAS No. 115 had no
material impact on the results of operations of the Company because under
its status as a BDC in 1994 and for part of 1995, the Company valued its
investments in the same manner as required under SFAS No. 115.
NET INCOME PER COMMON SHARE
Net income per common share is computed using the weighted average number
of common shares outstanding during each year.
RECLASSIFICATIONS
Certain prior year balances have been reclassified to conform with the
current year presentation. These reclassifications have no effect on net
income.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates, particularly with respect to the fair value determination of
investments, and the differences could be material.
2. PORTFOLIO INVESTMENTS:
The Company's investment in RailAmerica, Inc., as of December 31, 1995, is
comprised of 375,000 shares of common stock, which represents an 8%
interest in that company. The fair value of this investment as determined
by the Board of Directors is $1,089,375, compared to the Company's cost of
$626. At December 31, 1995, all of the shares were subject to a lock-up
agreement that restricts the Company's ability to sell the shares. In
light of this, at December 31, 1995, the Board of Directors reduced the
fair value of these shares by twenty percent from the average of the bid
and asked prices. The shares are also subject to restrictions under Rule
144.
F-7
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
3. DEFAULTED NOTE PAYABLE AND ACCRUED INTEREST:
Defaulted note payable and accrued interest consist of the following:
<TABLE>
<CAPTION>
<S> <C>
Defaulted note payable (1) $ 303,301
Accrued interest 284,728
------------
Total defaulted note payable
and accrued interest $ 588,029
------------
------------
</TABLE>
(1) The defaulted note payable was to a financial institution which was
taken over by regulatory authorities. At the time of the takeover,
the Company suspended payments on this note in an effort to
negotiate extensions, refinance the obligation or reach a
settlement. The Company adjusted the cumulative interest accrued on
the note to reflect the default rate of 18% in 1995. The Company
has attempted but has been unsuccessful at settling the obligation
as of the date hereof.
4. INCOME TAXES:
The Company accounts for income taxes pursuant to the provisions of
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes" ("SFAS No. 109"). SFAS No. 109 requires recognition of deferred tax
liabilities and assets for the expected future tax consequences of events
that have been included in the financial statements or tax returns. Under
this method, deferred tax liabilities and assets are determined based on
the difference between the financial statement and tax basis of assets and
liabilities using enacted tax rates in effect for the year in which the
differences are expected to reverse.
<TABLE>
<CAPTION>
<S> <C>
Current:
Federal $ 62,945
State 32,949
----------
95,894
----------
Deferred:
Federal 0
State 0
----------
0
----------
Total provision $ 95,894
----------
----------
</TABLE>
F-8
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
4. INCOME TAXES, CONTINUED:
The significant components of the net deferred tax assets as of
December 31, 1995, are as follows:
<TABLE>
<CAPTION>
<S> <C>
Deferred tax assets:
Net operating loss carryforward $1,238,000
Other 98,000
Valuation allowance (926,000)
-----------
410,000
-----------
Deferred tax liability:
Net unrealized appreciation of investments (410,000)
-----------
Net deferred tax assets $ 0
-----------
-----------
</TABLE>
SFAS No. 109 requires a valuation allowance against deferred tax assets if,
based on the weight of available evidence, it is more likely than not that
some or all of the deferred tax assets will not be realized. At December
31, 1995, the Company has established a valuation allowance against net
deferred tax assets of approximately $926,000.
For income tax purposes, the Company had a change in ownership during 1993
in connection with a private placement offering. The change in ownership
results in an annual limitation on the amount of pre-change ownership net
operating loss carryforwards which can be utilized to offset the Company's
future taxable income. The annual limitation is approximately $128,000 and
will be increased by the Company's pre-change built in gains when
recognized.
As of December 31, 1995, the Company has available for federal income tax
reporting purposes pre-change net operating losses of approximately
$3,086,000 and post-change net operating losses of approximately $381,000
These net operating loss carryforwards expire in the years 1998 through
2008.
RATE RECONCILIATION
A reconciliation of the difference between actual income tax expense and
income taxes computed at the federal statutory tax rate is as follows:
<TABLE>
<CAPTION>
<S> <C>
Federal statutory rate 34.00 %
State rate net of federal benefit 3.63 %
Benefit of NOL with prior period
valuation allowance (10.42)%
------------
27.21 %
------------
------------
</TABLE>
F-9
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
5. PROCEEDS FROM SETTLEMENT OF LITIGATION:
In March 1987, the Company filed suit against certain former selling
stockholders of Diversified Electronic Components, Inc. (DIELCO) a former
subsidiary which terminated its operations, and its former auditors
claiming misrepresentation, fraud, negligence, breach of fiduciary duty,
securities law violation and breach of contract and sought recision of this
purchase as well as actual and punitive damages. In April 1991, the
Company was awarded damages pursuant to a jury verdict in the civil action
against said auditors. The former auditors appealed the verdict. In
January 1994, the judgment was affirmed by the appellate court and the
Company was awarded approximately $4 million. After attorneys fees and
costs, the Company received $2,624,198. This amount has been recorded as
other income in the Consolidated Statement of Income for the year ended
December 31, 1994.
6. CONCENTRATION OF CREDIT RISK:
The Company's financial instruments that are potentially exposed to
concentrations of credit risk consist primarily of cash and the investment
in RailAmerica.
As of December 31, 1995, the Company had approximately $2.8 million of cash
and cash equivalents in excess of Federal insurance limits. In assessing
its risk, the Company has policies whereby it banks only with reputable
financial institutions. In March 1996, the Company paid a special cash
distribution (see Note 10) of approximately $2.5 million from such amounts.
The Company with its investment in RailAmerica is more susceptible to
factors adversely affecting this investment than a Company whose
investments are more diversified.
7. RELATED PARTY TRANSACTIONS:
The Company and Josephthal were parties to a financial consulting agreement
through March 1995 for which the Company paid Josephthal $3,000 a month in
consulting fees for services provided by Mr. Alan Jacobs, President and
Chief Executive Officer of the Company. Until January 1, 1996, Mr. Jacobs
was an employee of Josephthal. In addition, the consulting agreement
obligates, until January 1, 1996, the Company to pay Josephthal a
contingent transaction fee equal to two percent (2%) of the amount of any
financing or value of any transaction in connection with which Josephthal,
at the written request of the Company, renders advisory services to the
Company, but the source of such financing or transaction is not Josephthal.
The Company also is required to pay Josephthal contingent transaction fees
for financing of transactions introduced to the Company by Josephthal as
agreed to on a transaction-by-transaction basis. The consulting agreement
is for a five year term ending December 31, 1997, except that, the
agreement may be terminated by either party upon thirty days' prior written
notice. In March 1995, the consulting agreement with Josephthal was
terminated. Beginning in April 1995 and through December 31, 1995, the
Company agreed to pay Mr. Jacobs $3,000 a month in consulting fees
directly. Starting in 1996, the monthly consulting fee was increased to
$5,000 per month.
F-10
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
7. RELATED PARTY TRANSACTIONS, CONTINUED:
Pursuant to a consulting agreement, the Company paid Mr. Franklyn
Weichselbaum, as the Treasurer and Chief Financial Officer of the Company,
$2,200 per month in consulting fees. Starting in 1996, the monthly
consulting fee was increased to $3,500 per month. In addition to the
monthly consulting fees, the Company paid Mr. Weichselbaum $70,000 in 1994
for the consulting services he rendered in connection with the proposed
merger with Weitzer Homebuilders. The Company expensed the $70,000 as
discontinued merger costs (See Note 8).
8. DISCONTINUED MERGER COSTS:
The Company had entered into a definitive agreement with Harry Weitzer and
a number of entities controlled by Weitzer (collectively known as Weitzer
Homebuilders) which provided for the purchase of all of Weitzer's interest
in Weitzer Homebuilders for approximately 4,524,000 shares of Boca Raton
Capital Corporation common stock. This agreement was terminated and
$127,481 of costs associated with the proposed merger were charged to
income in the Consolidated Statement of Income for the year ended
December 31, 1994.
A note receivable from Weitzer Financial, Inc. in the amount of $500,000,
which accrues interest at prime plus 1%, was issued on June 30, 1994, and
was payable one year from the date of issuance. The value of this
investment, as determined by the Board of Directors, was the original cost
of $500,000 plus the accrued interest. In July 1995, payment was received
in full on the note.
9. RECEIVERSHIP:
On September 6, 1994, the Securities and Exchange Commission filed a
"Complaint for Preliminary Injunction and other Equitable Relief", stating
the Company was in violation of Section 56 of the Investment Company Act of
1940, which requires the Company to have a Board of Directors who are not
"interested persons", as defined in Section 2(a)(19) of the 1940 Act. The
"Consent Order for Preliminary Injunction and other Ancillary Relief" was
granted and the commission deemed it appropriate for the protection of the
Company's shareholders and the investing public to petition the United
States District Court to appoint a receiver. The appointed receiver,
Daniel H. Aronson, was granted full and exclusive power, duty and authority
to administer and manage the Company's affairs. On March 14, 1995, the
Court entered an order granting the motion of the receiver to approve the
election of the newly constituted Board of Directors and other
administrative procedures, the dismissal and discharge of the receiver and
the termination of the receivership created under the Consent Order.
F-11
<PAGE>
BOCA RATON CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
10. SUBSEQUENT EVENTS:
On January 11, 1996, the Board of Directors approved the payment of a
retainer to each director of the Company of $10,000 for services to be
rendered as a director during 1996 and granted 10,000 options to each of
the four independent directors and to its two officers. This retainer is
in addition to the normal recurring fees received of $1,500 per director
per meeting attended. Each option entitles the holder, for a period of four
years commencing on April 15, 1996, to purchase shares of the Company's
common stock at an exercise price of $3.00 per share. The exercise price
exceeded the market price per share and the book value per share of the
Company's common stock on the date of grant. The exercise price was
subsequently adjusted to $0.75 per share to reflect the special cash
distribution discussed below.
On January 11, 1996, the Board of Directors approved a special cash
distribution of $2.25 per share to the shareholders of record on January
11, 1996. The special cash distribution was approved by the Company's
shareholders at a special meeting held on February 29, 1996 and the special
cash distribution was paid on March 11, 1996. Had the transaction been
consummated on December 31, 1995, cash and stockholders' equity would have
each been reduced by $2.5 million.
F-12
<PAGE>
EXHIBIT INDEX
Sequentially
Numbered
Exhibit Page
- ------- ------------
10.19 Option Agreement, dated as of January 11, 1996, between
the Company and Alan L. Jacobs.
10.20 Option Agreement, dated as of January 11, 1996, between
the Company and Robert H. Arnold.
10.21 Option Agreement, dated as of January 11, 1996, between
the Company and Ronald L. Miller.
10.22 Option Agreement, dated as of January 11, 1996, between
the Company and C. Lawrence Rutstein.
10.23 Option Agreement, dated as of January 11, 1996, between
the Company and Alan H. Weingarten.
10.24 Option Agreement, dated as of January 11, 1996,
between the Company and Franklyn B. Weichselbaum.
22.2 Proxy Statement for Special Meeting of shareholders in lieu
of the Annual Meeting on December 15, 1995.
22.3 Proxy Statement for Special Meeting of shareholders on
February 29, 1996.
27. Financial Data Schedules.
99.3 Notification of Withdrawal of Election to be subject to
Sections 55 through 65 of the Investment Company Act of
1940 filed pursuant to Section 54(c) of the Investment
Company Act of 1940.
<PAGE>
EXHIBIT 10.19
BOCA RATON CAPITAL CORPORATION
STOCK OPTION AGREEMENT
AGREEMENT made as of the 11th day of January, 1996, by and between
Boca Raton Capital Corporation, a Florida corporation (the "Company"), and Alan
L. Jacobs (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company desires to grant to the Optionee, as director and
officer of the Company, and the Optionee desires to accept, an option to
purchase shares of common stock, $.001 par value, of the Company (the "Common
Stock") upon the terms and conditions set forth in this agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT. The Company hereby grants to the Optionee an option to
purchase 10,000 shares of Common Stock on the terms and conditions set forth
herein ("Option").
This Option to purchase shares of Common Stock is granted in
connection with the services rendered by the Optionee as a director and officer
of the Company.
2. PURCHASE PRICE. The purchase price of each share of
Common Stock subject to the option (collectively, the "Option Shares") shall be
$3.00 per share (subject to a reduction of $2.25 if the proposed special cash
distribution of $2.25 per share on each share of
<PAGE>
Common Stock outstanding of record on January 11, 1996 is approved by the
Company's shareholders and payment thereof is made by the Company). The
purchase price of the Option Shares shall be paid at the time of exercise, as
provided in paragraph 3 hereof.
3. EXERCISE. The Option to purchase 10,000 shares of Common Stock
shall become exercisable for a period of four (4) years commencing on April 15,
1996.
The options may be exercised in whole or in part by delivering to the
Secretary of the Company (a) a written notice specifying the number of shares to
be purchased, and (b) payment in full of the exercise price, together with the
amount, if any, deemed necessary by the Company to enable it to satisfy any
income tax withholding obligations with respect to the exercise (unless other
arrangements, acceptable to the Company, are made for the satisfaction of such
withholding obligations). The exercise price shall be payable by bank or
certified check, or by such other method as the Board of Directors in its sole
discretion, shall determine.
4. TERMINATION. The Option terminates on April 14, 2000 and may not
be exercised under any circumstances thereafter.
5. RIGHTS AS STOCKHOLDER. No shares of Common stock shall be sold
or delivered hereunder until full payment for such shares has been made. The
Optionee shall have no rights as a stockholder with respect to any Option Shares
until a stock certificate for such shares is issued to him or her. Except as
otherwise provided in paragraphs 2 and 8 hereof, no adjustment shall be made for
dividends or distributions of other rights for which the record date is prior to
the date such stock certificate is issued.
6. NONTRANSFERABILITY. This Option is not assignable or
transferable except by will and/or the laws of descent and distribution, and is
exercisable during the Optionee's lifetime only by the Optionee. If the
Optionee shall die, his estate, personal representative, or
2
<PAGE>
beneficiary shall have the right, subject to the provisions of paragraph 4, to
exercise the Option at any time during the remainder of the term of the Option.
7. SECURITIES RESTRICTIONS. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and all other applicable securities laws, as are in effect on
the date of exercise. If the shares to be issued upon an exercise of the Option
are not registered under the Securities Act, then, as a further condition of the
Company's obligation to issue such shares, the Optionee may be required to give
a representation in writing that the Optionee is acquiring the shares for his
own account as an investment and not with a view to, or for sale in connection
with, the distribution of such shares, and the certificate representing such
shares shall bear a legend to such effect as the Company's counsel shall deem
necessary or desirable. If Optionee is an officer or director of the Company or
other person (in each case, an "INSIDER") whose transactions in the Company's
Common Stock are subject to Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Company is subject to Section
16(b) of the Exchange Act, the shares acquired by Optionee upon exercise of this
Option may not be sold, transferred or otherwise disposed of by Optionee until
six (6) months after the date of grant of this Option.
8. CAPITAL CHANGES, REORGANIZATIONS, ETC.
(a) In case the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, or pay a dividend on, or make a
distribution of, shares of Common Stock or of the Company's capital stock
convertible into Common Stock, the exercise price per share of the Option Shares
and the number of Option Shares issuable upon exercise of this Option shall be
proportionately adjusted.
3
<PAGE>
(b) In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger which does not result in any reclassification or
change of the outstanding Common Stock), the corporation formed by such
consolidation or merger shall execute and deliver to the Optionee a supplemental
option agreement providing that the Optionee shall have the right thereafter
(until the expiration of such Option) to receive, upon exercise of such Option,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
shares of Common Stock of the Company for which such Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental option agreement shall provide for adjustments which shall be
identical to the adjustments provided in this paragraph 8. The above provision
of this subsection shall similarly apply to successive consolidations or
mergers.
(c) The Company shall not be required to issue certificates
representing fractions of shares on the exercise of the Option, nor shall it be
required to issue scrip or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated.
(d) All adjustments under this paragraph 8 shall be made by the
Board, and its determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive.
9. REGISTRATION RIGHTS.
(a) If at any time commencing after January 11, 1996 and
expiring on April 14, 2000, the Company proposes to register any of its
securities under the Act, it will give written notice by registered mail, at
least thirty (30) days prior to the filing of each such
4
<PAGE>
registration statement to the Optionee of its intention to do so. Upon the
written request of the Optionee given within ten (10) days after receipt of any
such notice of its or their desire to include any such Option Shares in such
proposed registration statement, the Company shall afford the Optionee the
opportunity to have any such Options Shares registered under such registration
statement.
Notwithstanding the provisions of this paragraph, the Company
shall have the right at any time after it shall have give written notice
pursuant to this paragraph 9 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date hereof.
If any registration pursuant to this paragraph 9 shall be
underwritten in whole or in part, the Company may require that the Option Shares
requested for inclusion pursuant to this paragraph 9 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s).
(b) In connection with any registration under this paragraph 9,
the Company and the Optionee hereby agree as follows:
(i) The Company shall pay all costs (excluding fees and expenses
of Optionee's counsel and any underwriting or selling commissions or other
charges of any broker-dealer acting on behalf of Optionee), fees and expenses in
connection with all registration statements filed pursuant to this paragraph 9,
including, without limitation, the Company's legal and accounting fees, printing
expenses, blue sky fees and expenses.
(ii) The Company will take all necessary action which may be
required in qualifying or registering the Option Shares included in a
registration statement for offering
5
<PAGE>
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Optionee, provided that the Company shall not be obligated to
qualify as a foreign corporation to do business under the laws of any such
jurisdiction.
(iii) The Company shall indemnify the Optionee in connection with
Option Shares to be sold pursuant to any registration statement and each person,
if any, who controls such Optionee within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Securities Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Option under the securities laws
thereof or filed with the Securities and Exchange Commission (the "Commission"),
any state securities commission or agency, the National Association of
Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading, unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the Optionee
expressly for use in such registration statement, any amendment or supplement
thereto or any application, as the case may be. If any action is brought
against the Optionee or any controlling person of the Optionee in respect of
which indemnity may be sought against the Company pursuant to this paragraph 9,
the Optionee or such controlling person shall within
6
<PAGE>
thirty (30) days after the receipt thereby of a summons or complaint notify the
Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and payment of
reasonable fees and expenses of counsel (which counsel shall be reasonably
satisfactory to the Optionee or such controlling person), but the failure to
give such notice shall not affect such indemnified person's right to
indemnification hereunder except to the extent that the Company's defense of
such action was materially adversely affected thereby. The Optionee or such
controlling person shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of the Optionee or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action, the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the fees and expenses of not more than one additional firm of attorneys for the
Optionee and/or such controlling person shall be borne by the Company. Except
as expressly provided in the previous sentence, in the event that the Company
shall not previously have assumed the defense of any such action or claim, the
Company shall not thereafter be liable to the Optionee or such controlling
person in investigating, preparing or defending any such action or claim. The
Company agrees promptly to notify the Optionee of the commencement of any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the resale of the Option Shares or in
connection with such registration statement.
7
<PAGE>
(iv) The Optionee, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers, directors,
shareholders, employees or representatives and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against all loss, claim, damage or expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they may become
subject under the Securities Act, the Exchange Act or any other statute, common
law or otherwise, arising from information furnished in writing by or on behalf
of Optionee, or their successors or assigns, for specific inclusion in such
registration statement. The Optionee further agrees that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Optionee have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this paragraph 9, any such payment or reimbursement by
the Optionee of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will be promptly repaid
to the Optionee.
(c) Nothing contained in this Agreement shall be construed as
requiring the Optionee to exercise their Option prior to the initial filing of
any registration statement or the effectiveness thereof.
8
<PAGE>
10. MISCELLANEOUS
(a) This agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(b) This agreement shall be governed by and construed in
accordance with the laws of the State of Florida. This agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and may not be modified except by written instrument executed by the
parties.
(c) Any dispute regarding the interpretation of this Option
shall be submitted by the Optionee or the Company to the Company's Board of
Directors, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on the
Company and on Optionee.
IN WITNESS WHEREOF, this agreement has been executed as of the date
first above written.
BOCA RATON CAPITAL CORPORATION
By:
---------------------------------------------------
-------------------------------------------------------
Optionee
9
<PAGE>
EXHIBIT 10.20
BOCA RATON CAPITAL CORPORATION
STOCK OPTION AGREEMENT
AGREEMENT made as of the 11th day of January, 1996, by and between
Boca Raton Capital Corporation, a Florida corporation (the "Company"), and
Robert H. Arnold (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company desires to grant to the Optionee, as director of
the Company, and the Optionee desires to accept, an option to purchase shares of
common stock, $.001 par value, of the Company (the "Common Stock") upon the
terms and conditions set forth in this agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT. The Company hereby grants to the Optionee an option to
purchase 10,000 shares of Common Stock on the terms and conditions set forth
herein ("Option").
This Option to purchase shares of Common Stock is granted in
connection with the services rendered by the Optionee as a director of the
Company.
2. PURCHASE PRICE. The purchase price of each share of Common Stock
subject to the option (collectively, the "Option Shares") shall be $3.00 per
share (subject to a reduction of $2.25 if the proposed special cash
distribution of $2.25 per share on each share of
<PAGE>
Common Stock outstanding of record on January 11, 1996 is approved by the
Company's shareholders and payment thereof is made by the Company). The
purchase price of the Option Shares shall be paid at the time of exercise, as
provided in paragraph 3 hereof.
3. EXERCISE. The Option to purchase 10,000 shares of Common Stock
shall become exercisable for a period of four (4) years commencing on April 15,
1996.
The options may be exercised in whole or in part by delivering to the
Secretary of the Company (a) a written notice specifying the number of shares to
be purchased, and (b) payment in full of the exercise price, together with the
amount, if any, deemed necessary by the Company to enable it to satisfy any
income tax withholding obligations with respect to the exercise (unless other
arrangements, acceptable to the Company, are made for the satisfaction of such
withholding obligations). The exercise price shall be payable by bank or
certified check, or by such other method as the Board of Directors in its sole
discretion, shall determine.
4. TERMINATION. The Option terminates on April 14, 2000 and may not
be exercised under any circumstances thereafter.
5. RIGHTS AS STOCKHOLDER. No shares of Common stock shall be sold
or delivered hereunder until full payment for such shares has been made. The
Optionee shall have no rights as a stockholder with respect to any Option Shares
until a stock certificate for such shares is issued to him or her. Except as
otherwise provided in paragraphs 2 and 8 hereof, no adjustment shall be made for
dividends or distributions of other rights for which the record date is prior to
the date such stock certificate is issued.
6. NONTRANSFERABILITY. This Option is not assignable or
transferable except by will and/or the laws of descent and distribution, and is
exercisable during the Optionee's lifetime only by the Optionee. If the
Optionee shall die, his estate, personal representative, or
2
<PAGE>
beneficiary shall have the right, subject to the provisions of paragraph 4, to
exercise the Option at any time during the remainder of the term of the Option.
7. SECURITIES RESTRICTIONS. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and all other applicable securities laws, as are in effect on
the date of exercise. If the shares to be issued upon an exercise of the Option
are not registered under the Securities Act, then, as a further condition of the
Company's obligation to issue such shares, the Optionee may be required to give
a representation in writing that the Optionee is acquiring the shares for his
own account as an investment and not with a view to, or for sale in connection
with, the distribution of such shares, and the certificate representing such
shares shall bear a legend to such effect as the Company's counsel shall deem
necessary or desirable. If Optionee is an officer or director of the Company or
other person (in each case, an "INSIDER") whose transactions in the Company's
Common Stock are subject to Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Company is subject to Section
16(b) of the Exchange Act, the shares acquired by Optionee upon exercise of this
Option may not be sold, transferred or otherwise disposed of by Optionee until
six (6) months after the date of grant of this Option.
8. CAPITAL CHANGES, REORGANIZATIONS, ETC.
(a) In case the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, or pay a dividend on, or make a
distribution of, shares of Common Stock or of the Company's capital stock
convertible into Common Stock, the exercise price per share of the Option Shares
and the number of Option Shares issuable upon exercise of this Option shall be
proportionately adjusted.
3
<PAGE>
(b) In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger which does not result in any reclassification or
change of the outstanding Common Stock), the corporation formed by such
consolidation or merger shall execute and deliver to the Optionee a supplemental
option agreement providing that the Optionee shall have the right thereafter
(until the expiration of such Option) to receive, upon exercise of such Option,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
shares of Common Stock of the Company for which such Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental option agreement shall provide for adjustments which shall be
identical to the adjustments provided in this paragraph 8. The above provision
of this subsection shall similarly apply to successive consolidations or
mergers.
(c) The Company shall not be required to issue certificates
representing fractions of shares on the exercise of the Option, nor shall it be
required to issue scrip or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated.
(d) All adjustments under this paragraph 8 shall be made by the
Board, and its determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive.
9. REGISTRATION RIGHTS.
(a) If at any time commencing after January 11, 1996 and
expiring on April 14, 2000, the Company proposes to register any of its
securities under the Act, it will give written notice by registered mail, at
least thirty (30) days prior to the filing of each such
4
<PAGE>
registration statement to the Optionee of its intention to do so. Upon the
written request of the Optionee given within ten (10) days after receipt of any
such notice of its or their desire to include any such Option Shares in such
proposed registration statement, the Company shall afford the Optionee the
opportunity to have any such Options Shares registered under such registration
statement.
Notwithstanding the provisions of this paragraph, the Company
shall have the right at any time after it shall have give written notice
pursuant to this paragraph 9 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date hereof.
If any registration pursuant to this paragraph 9 shall be
underwritten in whole or in part, the Company may require that the Option Shares
requested for inclusion pursuant to this paragraph 9 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s).
(b) In connection with any registration under this paragraph 9,
the Company and the Optionee hereby agree as follows:
(i) The Company shall pay all costs (excluding fees and expenses
of Optionee's counsel and any underwriting or selling commissions or other
charges of any broker-dealer acting on behalf of Optionee), fees and expenses in
connection with all registration statements filed pursuant to this paragraph 9,
including, without limitation, the Company's legal and accounting fees, printing
expenses, blue sky fees and expenses.
(ii) The Company will take all necessary action which may be
required in qualifying or registering the Option Shares included in a
registration statement for offering
5
<PAGE>
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Optionee, provided that the Company shall not be obligated to
qualify as a foreign corporation to do business under the laws of any such
jurisdiction.
(iii) The Company shall indemnify the Optionee in connection with
Option Shares to be sold pursuant to any registration statement and each person,
if any, who controls such Optionee within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Securities Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Option under the securities laws
thereof or filed with the Securities and Exchange Commission (the "Commission"),
any state securities commission or agency, the National Association of
Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading, unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the Optionee
expressly for use in such registration statement, any amendment or supplement
thereto or any application, as the case may be. If any action is brought
against the Optionee or any controlling person of the Optionee in respect of
which indemnity may be sought against the Company pursuant to this paragraph 9,
the Optionee or such controlling person shall within
6
<PAGE>
thirty (30) days after the receipt thereby of a summons or complaint notify the
Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and payment of
reasonable fees and expenses of counsel (which counsel shall be reasonably
satisfactory to the Optionee or such controlling person), but the failure to
give such notice shall not affect such indemnified person's right to
indemnification hereunder except to the extent that the Company's defense of
such action was materially adversely affected thereby. The Optionee or such
controlling person shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of the Optionee or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action, the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the fees and expenses of not more than one additional firm of attorneys for the
Optionee and/or such controlling person shall be borne by the Company. Except
as expressly provided in the previous sentence, in the event that the Company
shall not previously have assumed the defense of any such action or claim, the
Company shall not thereafter be liable to the Optionee or such controlling
person in investigating, preparing or defending any such action or claim. The
Company agrees promptly to notify the Optionee of the commencement of any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the resale of the Option Shares or in
connection with such registration statement.
7
<PAGE>
(iv) The Optionee, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers, directors,
shareholders, employees or representatives and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against all loss, claim, damage or expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they may become
subject under the Securities Act, the Exchange Act or any other statute, common
law or otherwise, arising from information furnished in writing by or on behalf
of Optionee, or their successors or assigns, for specific inclusion in such
registration statement. The Optionee further agrees that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Optionee have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this paragraph 9, any such payment or reimbursement by
the Optionee of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will be promptly repaid
to the Optionee.
(c) Nothing contained in this Agreement shall be construed as
requiring the Optionee to exercise their Option prior to the initial filing of
any registration statement or the effectiveness thereof.
8
<PAGE>
10. MISCELLANEOUS
(a) This agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(b) This agreement shall be governed by and construed in
accordance with the laws of the State of Florida. This agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and may not be modified except by written instrument executed by the
parties.
(c) Any dispute regarding the interpretation of this Option
shall be submitted by the Optionee or the Company to the Company's Board of
Directors, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on the
Company and on Optionee.
IN WITNESS WHEREOF, this agreement has been executed as of the date
first above written.
BOCA RATON CAPITAL CORPORATION
By:
---------------------------------------------------
-------------------------------------------------------
Optionee
9
<PAGE>
EXHIBIT 10.21
BOCA RATON CAPITAL CORPORATION
STOCK OPTION AGREEMENT
AGREEMENT made as of the 11th day of January, 1996, by and between
Boca Raton Capital Corporation, a Florida corporation (the "Company"), and
Ronald L. Miller (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company desires to grant to the Optionee, as director of
the Company, and the Optionee desires to accept, an option to purchase shares of
common stock, $.001 par value, of the Company (the "Common Stock") upon the
terms and conditions set forth in this agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT. The Company hereby grants to the Optionee an option to
purchase 10,000 shares of Common Stock on the terms and conditions set forth
herein ("Option").
This Option to purchase shares of Common Stock is granted in
connection with the services rendered by the Optionee as a director of the
Company.
2. PURCHASE PRICE. The purchase price of each share of Common Stock
subject to the option (collectively, the "Option Shares") shall be $3.00 per
share (subject to a reduction of $2.25 if the proposed special cash
distribution of $2.25 per share on each share of
<PAGE>
Common Stock outstanding of record on January 11, 1996 is approved by the
Company's shareholders and payment thereof is made by the Company). The
purchase price of the Option Shares shall be paid at the time of exercise, as
provided in paragraph 3 hereof.
3. EXERCISE. The Option to purchase 10,000 shares of Common Stock
shall become exercisable for a period of four (4) years commencing on April 15,
1996.
The options may be exercised in whole or in part by delivering to the
Secretary of the Company (a) a written notice specifying the number of shares to
be purchased, and (b) payment in full of the exercise price, together with the
amount, if any, deemed necessary by the Company to enable it to satisfy any
income tax withholding obligations with respect to the exercise (unless other
arrangements, acceptable to the Company, are made for the satisfaction of such
withholding obligations). The exercise price shall be payable by bank or
certified check, or by such other method as the Board of Directors in its sole
discretion, shall determine.
4. TERMINATION. The Option terminates on April 14, 2000 and may not
be exercised under any circumstances thereafter.
5. RIGHTS AS STOCKHOLDER. No shares of Common stock shall be sold
or delivered hereunder until full payment for such shares has been made. The
Optionee shall have no rights as a stockholder with respect to any Option Shares
until a stock certificate for such shares is issued to him or her. Except as
otherwise provided in paragraphs 2 and 8 hereof, no adjustment shall be made for
dividends or distributions of other rights for which the record date is prior to
the date such stock certificate is issued.
6. NONTRANSFERABILITY. This Option is not assignable or
transferable except by will and/or the laws of descent and distribution, and is
exercisable during the Optionee's lifetime only by the Optionee. If the
Optionee shall die, his estate, personal representative, or
2
<PAGE>
beneficiary shall have the right, subject to the provisions of paragraph 4, to
exercise the Option at any time during the remainder of the term of the Option.
7. SECURITIES RESTRICTIONS. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and all other applicable securities laws, as are in effect on
the date of exercise. If the shares to be issued upon an exercise of the Option
are not registered under the Securities Act, then, as a further condition of the
Company's obligation to issue such shares, the Optionee may be required to give
a representation in writing that the Optionee is acquiring the shares for his
own account as an investment and not with a view to, or for sale in connection
with, the distribution of such shares, and the certificate representing such
shares shall bear a legend to such effect as the Company's counsel shall deem
necessary or desirable. If Optionee is an officer or director of the Company or
other person (in each case, an "INSIDER") whose transactions in the Company's
Common Stock are subject to Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Company is subject to Section
16(b) of the Exchange Act, the shares acquired by Optionee upon exercise of this
Option may not be sold, transferred or otherwise disposed of by Optionee until
six (6) months after the date of grant of this Option.
8. CAPITAL CHANGES, REORGANIZATIONS, ETC.
(a) In case the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, or pay a dividend on, or make a
distribution of, shares of Common Stock or of the Company's capital stock
convertible into Common Stock, the exercise price per share of the Option Shares
and the number of Option Shares issuable upon exercise of this Option shall be
proportionately adjusted.
3
<PAGE>
(b) In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger which does not result in any reclassification or
change of the outstanding Common Stock), the corporation formed by such
consolidation or merger shall execute and deliver to the Optionee a supplemental
option agreement providing that the Optionee shall have the right thereafter
(until the expiration of such Option) to receive, upon exercise of such Option,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
shares of Common Stock of the Company for which such Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental option agreement shall provide for adjustments which shall be
identical to the adjustments provided in this paragraph 8. The above provision
of this subsection shall similarly apply to successive consolidations or
mergers.
(c) The Company shall not be required to issue certificates
representing fractions of shares on the exercise of the Option, nor shall it be
required to issue scrip or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated.
(d) All adjustments under this paragraph 8 shall be made by the
Board, and its determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive.
9. REGISTRATION RIGHTS.
(a) If at any time commencing after January 11, 1996 and
expiring on April 14, 2000, the Company proposes to register any of its
securities under the Act, it will give written notice by registered mail, at
least thirty (30) days prior to the filing of each such
4
<PAGE>
registration statement to the Optionee of its intention to do so. Upon the
written request of the Optionee given within ten (10) days after receipt of any
such notice of its or their desire to include any such Option Shares in such
proposed registration statement, the Company shall afford the Optionee the
opportunity to have any such Options Shares registered under such registration
statement.
Notwithstanding the provisions of this paragraph, the Company
shall have the right at any time after it shall have give written notice
pursuant to this paragraph 9 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date hereof.
If any registration pursuant to this paragraph 9 shall be
underwritten in whole or in part, the Company may require that the Option Shares
requested for inclusion pursuant to this paragraph 9 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s).
(b) In connection with any registration under this paragraph 9,
the Company and the Optionee hereby agree as follows:
(i) The Company shall pay all costs (excluding fees and expenses
of Optionee's counsel and any underwriting or selling commissions or other
charges of any broker-dealer acting on behalf of Optionee), fees and expenses in
connection with all registration statements filed pursuant to this paragraph 9,
including, without limitation, the Company's legal and accounting fees, printing
expenses, blue sky fees and expenses.
(ii) The Company will take all necessary action which may be
required in qualifying or registering the Option Shares included in a
registration statement for offering
5
<PAGE>
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Optionee, provided that the Company shall not be obligated to
qualify as a foreign corporation to do business under the laws of any such
jurisdiction.
(iii) The Company shall indemnify the Optionee in connection with
Option Shares to be sold pursuant to any registration statement and each person,
if any, who controls such Optionee within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Securities Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Option under the securities laws
thereof or filed with the Securities and Exchange Commission (the "Commission"),
any state securities commission or agency, the National Association of
Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading, unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the Optionee
expressly for use in such registration statement, any amendment or supplement
thereto or any application, as the case may be. If any action is brought
against the Optionee or any controlling person of the Optionee in respect of
which indemnity may be sought against the Company pursuant to this paragraph 9,
the Optionee or such controlling person shall within
6
<PAGE>
thirty (30) days after the receipt thereby of a summons or complaint notify the
Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and payment of
reasonable fees and expenses of counsel (which counsel shall be reasonably
satisfactory to the Optionee or such controlling person), but the failure to
give such notice shall not affect such indemnified person's right to
indemnification hereunder except to the extent that the Company's defense of
such action was materially adversely affected thereby. The Optionee or such
controlling person shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of the Optionee or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action, the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the fees and expenses of not more than one additional firm of attorneys for the
Optionee and/or such controlling person shall be borne by the Company. Except
as expressly provided in the previous sentence, in the event that the Company
shall not previously have assumed the defense of any such action or claim, the
Company shall not thereafter be liable to the Optionee or such controlling
person in investigating, preparing or defending any such action or claim. The
Company agrees promptly to notify the Optionee of the commencement of any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the resale of the Option Shares or in
connection with such registration statement.
7
<PAGE>
(iv) The Optionee, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers, directors,
shareholders, employees or representatives and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against all loss, claim, damage or expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they may become
subject under the Securities Act, the Exchange Act or any other statute, common
law or otherwise, arising from information furnished in writing by or on behalf
of Optionee, or their successors or assigns, for specific inclusion in such
registration statement. The Optionee further agrees that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Optionee have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this paragraph 9, any such payment or reimbursement by
the Optionee of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will be promptly repaid
to the Optionee.
(c) Nothing contained in this Agreement shall be construed as
requiring the Optionee to exercise their Option prior to the initial filing of
any registration statement or the effectiveness thereof.
8
<PAGE>
10. MISCELLANEOUS
(a) This agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(b) This agreement shall be governed by and construed in
accordance with the laws of the State of Florida. This agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and may not be modified except by written instrument executed by the
parties.
(c) Any dispute regarding the interpretation of this Option
shall be submitted by the Optionee or the Company to the Company's Board of
Directors, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on the
Company and on Optionee.
IN WITNESS WHEREOF, this agreement has been executed as of the date
first above written.
BOCA RATON CAPITAL CORPORATION
By:
---------------------------------------------------
-------------------------------------------------------
Optionee
9
<PAGE>
EXHIBIT 10.22
BOCA RATON CAPITAL CORPORATION
STOCK OPTION AGREEMENT
AGREEMENT made as of the 11th day of January, 1996, by and between
Boca Raton Capital Corporation, a Florida corporation (the "Company"), and C.
Lawrence Rutstein (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company desires to grant to the Optionee, as director of
the Company, and the Optionee desires to accept, an option to purchase shares of
common stock, $.001 par value, of the Company (the "Common Stock") upon the
terms and conditions set forth in this agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT. The Company hereby grants to the Optionee an option to
purchase 10,000 shares of Common Stock on the terms and conditions set forth
herein ("Option").
This Option to purchase shares of Common Stock is granted in
connection with the services rendered by the Optionee as a director of the
Company.
2. PURCHASE PRICE. The purchase price of each share of Common Stock
subject to the option (collectively, the "Option Shares") shall be $3.00 per
share (subject to a reduction of $2.25 if the proposed special cash
distribution of $2.25 per share on each share of
<PAGE>
Common Stock outstanding of record on January 11, 1996 is approved by the
Company's shareholders and payment thereof is made by the Company). The
purchase price of the Option Shares shall be paid at the time of exercise, as
provided in paragraph 3 hereof.
3. EXERCISE. The Option to purchase 10,000 shares of Common Stock
shall become exercisable for a period of four (4) years commencing on April 15,
1996.
The options may be exercised in whole or in part by delivering to the
Secretary of the Company (a) a written notice specifying the number of shares to
be purchased, and (b) payment in full of the exercise price, together with the
amount, if any, deemed necessary by the Company to enable it to satisfy any
income tax withholding obligations with respect to the exercise (unless other
arrangements, acceptable to the Company, are made for the satisfaction of such
withholding obligations). The exercise price shall be payable by bank or
certified check, or by such other method as the Board of Directors in its sole
discretion, shall determine.
4. TERMINATION. The Option terminates on April 14, 2000 and may not
be exercised under any circumstances thereafter.
5. RIGHTS AS STOCKHOLDER. No shares of Common stock shall be sold
or delivered hereunder until full payment for such shares has been made. The
Optionee shall have no rights as a stockholder with respect to any Option Shares
until a stock certificate for such shares is issued to him or her. Except as
otherwise provided in paragraphs 2 and 8 hereof, no adjustment shall be made for
dividends or distributions of other rights for which the record date is prior to
the date such stock certificate is issued.
6. NONTRANSFERABILITY. This Option is not assignable or
transferable except by will and/or the laws of descent and distribution, and is
exercisable during the Optionee's lifetime only by the Optionee. If the
Optionee shall die, his estate, personal representative, or
2
<PAGE>
beneficiary shall have the right, subject to the provisions of paragraph 4, to
exercise the Option at any time during the remainder of the term of the Option.
7. SECURITIES RESTRICTIONS. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and all other applicable securities laws, as are in effect on
the date of exercise. If the shares to be issued upon an exercise of the Option
are not registered under the Securities Act, then, as a further condition of the
Company's obligation to issue such shares, the Optionee may be required to give
a representation in writing that the Optionee is acquiring the shares for his
own account as an investment and not with a view to, or for sale in connection
with, the distribution of such shares, and the certificate representing such
shares shall bear a legend to such effect as the Company's counsel shall deem
necessary or desirable. If Optionee is an officer or director of the Company or
other person (in each case, an "INSIDER") whose transactions in the Company's
Common Stock are subject to Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Company is subject to Section
16(b) of the Exchange Act, the shares acquired by Optionee upon exercise of this
Option may not be sold, transferred or otherwise disposed of by Optionee until
six (6) months after the date of grant of this Option.
8. CAPITAL CHANGES, REORGANIZATIONS, ETC.
(a) In case the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, or pay a dividend on, or make a
distribution of, shares of Common Stock or of the Company's capital stock
convertible into Common Stock, the exercise price per share of the Option Shares
and the number of Option Shares issuable upon exercise of this Option shall be
proportionately adjusted.
3
<PAGE>
(b) In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger which does not result in any reclassification or
change of the outstanding Common Stock), the corporation formed by such
consolidation or merger shall execute and deliver to the Optionee a supplemental
option agreement providing that the Optionee shall have the right thereafter
(until the expiration of such Option) to receive, upon exercise of such Option,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
shares of Common Stock of the Company for which such Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental option agreement shall provide for adjustments which shall be
identical to the adjustments provided in this paragraph 8. The above provision
of this subsection shall similarly apply to successive consolidations or
mergers.
(c) The Company shall not be required to issue certificates
representing fractions of shares on the exercise of the Option, nor shall it be
required to issue scrip or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated.
(d) All adjustments under this paragraph 8 shall be made by the
Board, and its determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive.
9. REGISTRATION RIGHTS.
(a) If at any time commencing after January 11, 1996 and
expiring on April 14, 2000, the Company proposes to register any of its
securities under the Act, it will give written notice by registered mail, at
least thirty (30) days prior to the filing of each such
4
<PAGE>
registration statement to the Optionee of its intention to do so. Upon the
written request of the Optionee given within ten (10) days after receipt of any
such notice of its or their desire to include any such Option Shares in such
proposed registration statement, the Company shall afford the Optionee the
opportunity to have any such Options Shares registered under such registration
statement.
Notwithstanding the provisions of this paragraph, the Company
shall have the right at any time after it shall have give written notice
pursuant to this paragraph 9 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date hereof.
If any registration pursuant to this paragraph 9 shall be
underwritten in whole or in part, the Company may require that the Option Shares
requested for inclusion pursuant to this paragraph 9 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s).
(b) In connection with any registration under this paragraph 9,
the Company and the Optionee hereby agree as follows:
(i) The Company shall pay all costs (excluding fees and expenses
of Optionee's counsel and any underwriting or selling commissions or other
charges of any broker-dealer acting on behalf of Optionee), fees and expenses in
connection with all registration statements filed pursuant to this paragraph 9,
including, without limitation, the Company's legal and accounting fees, printing
expenses, blue sky fees and expenses.
(ii) The Company will take all necessary action which may be
required in qualifying or registering the Option Shares included in a
registration statement for offering
5
<PAGE>
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Optionee, provided that the Company shall not be obligated to
qualify as a foreign corporation to do business under the laws of any such
jurisdiction.
(iii) The Company shall indemnify the Optionee in connection with
Option Shares to be sold pursuant to any registration statement and each person,
if any, who controls such Optionee within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Securities Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Option under the securities laws
thereof or filed with the Securities and Exchange Commission (the "Commission"),
any state securities commission or agency, the National Association of
Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading, unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the Optionee
expressly for use in such registration statement, any amendment or supplement
thereto or any application, as the case may be. If any action is brought
against the Optionee or any controlling person of the Optionee in respect of
which indemnity may be sought against the Company pursuant to this paragraph 9,
the Optionee or such controlling person shall within
6
<PAGE>
thirty (30) days after the receipt thereby of a summons or complaint notify the
Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and payment of
reasonable fees and expenses of counsel (which counsel shall be reasonably
satisfactory to the Optionee or such controlling person), but the failure to
give such notice shall not affect such indemnified person's right to
indemnification hereunder except to the extent that the Company's defense of
such action was materially adversely affected thereby. The Optionee or such
controlling person shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of the Optionee or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action, the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the fees and expenses of not more than one additional firm of attorneys for the
Optionee and/or such controlling person shall be borne by the Company. Except
as expressly provided in the previous sentence, in the event that the Company
shall not previously have assumed the defense of any such action or claim, the
Company shall not thereafter be liable to the Optionee or such controlling
person in investigating, preparing or defending any such action or claim. The
Company agrees promptly to notify the Optionee of the commencement of any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the resale of the Option Shares or in
connection with such registration statement.
7
<PAGE>
(iv) The Optionee, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers, directors,
shareholders, employees or representatives and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against all loss, claim, damage or expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they may become
subject under the Securities Act, the Exchange Act or any other statute, common
law or otherwise, arising from information furnished in writing by or on behalf
of Optionee, or their successors or assigns, for specific inclusion in such
registration statement. The Optionee further agrees that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Optionee have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this paragraph 9, any such payment or reimbursement by
the Optionee of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will be promptly repaid
to the Optionee.
(c) Nothing contained in this Agreement shall be construed as
requiring the Optionee to exercise their Option prior to the initial filing of
any registration statement or the effectiveness thereof.
8
<PAGE>
10. MISCELLANEOUS
(a) This agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(b) This agreement shall be governed by and construed in
accordance with the laws of the State of Florida. This agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and may not be modified except by written instrument executed by the
parties.
(c) Any dispute regarding the interpretation of this Option
shall be submitted by the Optionee or the Company to the Company's Board of
Directors, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on the
Company and on Optionee.
IN WITNESS WHEREOF, this agreement has been executed as of the date
first above written.
BOCA RATON CAPITAL CORPORATION
By:
---------------------------------------------------
-------------------------------------------------------
Optionee
9
<PAGE>
EXHIBIT 10.23
BOCA RATON CAPITAL CORPORATION
STOCK OPTION AGREEMENT
AGREEMENT made as of the 11th day of January, 1996, by and between
Boca Raton Capital Corporation, a Florida corporation (the "Company"), and Alan
H. Weingarten (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company desires to grant to the Optionee, as director of
the Company, and the Optionee desires to accept, an option to purchase shares of
common stock, $.001 par value, of the Company (the "Common Stock") upon the
terms and conditions set forth in this agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT. The Company hereby grants to the Optionee an option to
purchase 10,000 shares of Common Stock on the terms and conditions set forth
herein ("Option").
This Option to purchase shares of Common Stock is granted in
connection with the services rendered by the Optionee as a director of the
Company.
2. PURCHASE PRICE. The purchase price of each share of Common Stock
subject to the option (collectively, the "Option Shares") shall be $3.00 per
share (subject to a reduction of $2.25 if the proposed special cash
distribution of $2.25 per share on each share of
<PAGE>
Common Stock outstanding of record on January 11, 1996 is approved by the
Company's shareholders and payment thereof is made by the Company). The
purchase price of the Option Shares shall be paid at the time of exercise, as
provided in paragraph 3 hereof.
3. EXERCISE. The Option to purchase 10,000 shares of Common Stock
shall become exercisable for a period of four (4) years commencing on April 15,
1996.
The options may be exercised in whole or in part by delivering to the
Secretary of the Company (a) a written notice specifying the number of shares to
be purchased, and (b) payment in full of the exercise price, together with the
amount, if any, deemed necessary by the Company to enable it to satisfy any
income tax withholding obligations with respect to the exercise (unless other
arrangements, acceptable to the Company, are made for the satisfaction of such
withholding obligations). The exercise price shall be payable by bank or
certified check, or by such other method as the Board of Directors in its sole
discretion, shall determine.
4. TERMINATION. The Option terminates on April 14, 2000 and may not
be exercised under any circumstances thereafter.
5. RIGHTS AS STOCKHOLDER. No shares of Common stock shall be sold
or delivered hereunder until full payment for such shares has been made. The
Optionee shall have no rights as a stockholder with respect to any Option Shares
until a stock certificate for such shares is issued to him or her. Except as
otherwise provided in paragraphs 2 and 8 hereof, no adjustment shall be made for
dividends or distributions of other rights for which the record date is prior to
the date such stock certificate is issued.
6. NONTRANSFERABILITY. This Option is not assignable or
transferable except by will and/or the laws of descent and distribution, and is
exercisable during the Optionee's lifetime only by the Optionee. If the
Optionee shall die, his estate, personal representative, or
2
<PAGE>
beneficiary shall have the right, subject to the provisions of paragraph 4, to
exercise the Option at any time during the remainder of the term of the Option.
7. SECURITIES RESTRICTIONS. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and all other applicable securities laws, as are in effect on
the date of exercise. If the shares to be issued upon an exercise of the Option
are not registered under the Securities Act, then, as a further condition of the
Company's obligation to issue such shares, the Optionee may be required to give
a representation in writing that the Optionee is acquiring the shares for his
own account as an investment and not with a view to, or for sale in connection
with, the distribution of such shares, and the certificate representing such
shares shall bear a legend to such effect as the Company's counsel shall deem
necessary or desirable. If Optionee is an officer or director of the Company or
other person (in each case, an "INSIDER") whose transactions in the Company's
Common Stock are subject to Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Company is subject to Section
16(b) of the Exchange Act, the shares acquired by Optionee upon exercise of this
Option may not be sold, transferred or otherwise disposed of by Optionee until
six (6) months after the date of grant of this Option.
8. CAPITAL CHANGES, REORGANIZATIONS, ETC.
(a) In case the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, or pay a dividend on, or make a
distribution of, shares of Common Stock or of the Company's capital stock
convertible into Common Stock, the exercise price per share of the Option Shares
and the number of Option Shares issuable upon exercise of this Option shall be
proportionately adjusted.
3
<PAGE>
(b) In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger which does not result in any reclassification or
change of the outstanding Common Stock), the corporation formed by such
consolidation or merger shall execute and deliver to the Optionee a supplemental
option agreement providing that the Optionee shall have the right thereafter
(until the expiration of such Option) to receive, upon exercise of such Option,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
shares of Common Stock of the Company for which such Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental option agreement shall provide for adjustments which shall be
identical to the adjustments provided in this paragraph 8. The above provision
of this subsection shall similarly apply to successive consolidations or
mergers.
(c) The Company shall not be required to issue certificates
representing fractions of shares on the exercise of the Option, nor shall it be
required to issue scrip or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated.
(d) All adjustments under this paragraph 8 shall be made by the
Board, and its determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive.
9. REGISTRATION RIGHTS.
(a) If at any time commencing after January 11, 1996 and
expiring on April 14, 2000, the Company proposes to register any of its
securities under the Act, it will give written notice by registered mail, at
least thirty (30) days prior to the filing of each such
4
<PAGE>
registration statement to the Optionee of its intention to do so. Upon the
written request of the Optionee given within ten (10) days after receipt of any
such notice of its or their desire to include any such Option Shares in such
proposed registration statement, the Company shall afford the Optionee the
opportunity to have any such Options Shares registered under such registration
statement.
Notwithstanding the provisions of this paragraph, the Company
shall have the right at any time after it shall have give written notice
pursuant to this paragraph 9 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date hereof.
If any registration pursuant to this paragraph 9 shall be
underwritten in whole or in part, the Company may require that the Option Shares
requested for inclusion pursuant to this paragraph 9 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s).
(b) In connection with any registration under this paragraph 9,
the Company and the Optionee hereby agree as follows:
(i) The Company shall pay all costs (excluding fees and expenses
of Optionee's counsel and any underwriting or selling commissions or other
charges of any broker-dealer acting on behalf of Optionee), fees and expenses in
connection with all registration statements filed pursuant to this paragraph 9,
including, without limitation, the Company's legal and accounting fees, printing
expenses, blue sky fees and expenses.
(ii) The Company will take all necessary action which may be
required in qualifying or registering the Option Shares included in a
registration statement for offering
5
<PAGE>
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Optionee, provided that the Company shall not be obligated to
qualify as a foreign corporation to do business under the laws of any such
jurisdiction.
(iii) The Company shall indemnify the Optionee in connection with
Option Shares to be sold pursuant to any registration statement and each person,
if any, who controls such Optionee within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Securities Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Option under the securities laws
thereof or filed with the Securities and Exchange Commission (the "Commission"),
any state securities commission or agency, the National Association of
Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading, unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the Optionee
expressly for use in such registration statement, any amendment or supplement
thereto or any application, as the case may be. If any action is brought
against the Optionee or any controlling person of the Optionee in respect of
which indemnity may be sought against the Company pursuant to this paragraph 9,
the Optionee or such controlling person shall within
6
<PAGE>
thirty (30) days after the receipt thereby of a summons or complaint notify the
Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and payment of
reasonable fees and expenses of counsel (which counsel shall be reasonably
satisfactory to the Optionee or such controlling person), but the failure to
give such notice shall not affect such indemnified person's right to
indemnification hereunder except to the extent that the Company's defense of
such action was materially adversely affected thereby. The Optionee or such
controlling person shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of the Optionee or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action, the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the fees and expenses of not more than one additional firm of attorneys for the
Optionee and/or such controlling person shall be borne by the Company. Except
as expressly provided in the previous sentence, in the event that the Company
shall not previously have assumed the defense of any such action or claim, the
Company shall not thereafter be liable to the Optionee or such controlling
person in investigating, preparing or defending any such action or claim. The
Company agrees promptly to notify the Optionee of the commencement of any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the resale of the Option Shares or in
connection with such registration statement.
7
<PAGE>
(iv) The Optionee, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers, directors,
shareholders, employees or representatives and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against all loss, claim, damage or expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they may become
subject under the Securities Act, the Exchange Act or any other statute, common
law or otherwise, arising from information furnished in writing by or on behalf
of Optionee, or their successors or assigns, for specific inclusion in such
registration statement. The Optionee further agrees that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Optionee have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this paragraph 9, any such payment or reimbursement by
the Optionee of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will be promptly repaid
to the Optionee.
(c) Nothing contained in this Agreement shall be construed as
requiring the Optionee to exercise their Option prior to the initial filing of
any registration statement or the effectiveness thereof.
8
<PAGE>
10. MISCELLANEOUS
(a) This agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(b) This agreement shall be governed by and construed in
accordance with the laws of the State of Florida. This agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and may not be modified except by written instrument executed by the
parties.
(c) Any dispute regarding the interpretation of this Option
shall be submitted by the Optionee or the Company to the Company's Board of
Directors, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on the
Company and on Optionee.
IN WITNESS WHEREOF, this agreement has been executed as of the date
first above written.
BOCA RATON CAPITAL CORPORATION
By:
---------------------------------------------------
-------------------------------------------------------
Optionee
9
<PAGE>
EXHIBIT 10.24
BOCA RATON CAPITAL CORPORATION
STOCK OPTION AGREEMENT
AGREEMENT made as of the 11th day of January, 1996, by and between
Boca Raton Capital Corporation, a Florida corporation (the "Company"), and
Franklyn B. Weichselbaum (the "Optionee").
W I T N E S S E T H
WHEREAS, the Company desires to grant to the Optionee, as an officer
of the Company, and the Optionee desires to accept, an option to purchase shares
of common stock, $.001 par value, of the Company (the "Common Stock") upon the
terms and conditions set forth in this agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. GRANT. The Company hereby grants to the Optionee an option to
purchase 10,000 shares of Common Stock on the terms and conditions set forth
herein ("Option").
This Option to purchase shares of Common Stock is granted in
connection with the services rendered by the Optionee as an officer of the
Company.
2. PURCHASE PRICE. The purchase price of each share of Common Stock
subject to the option (collectively, the "Option Shares") shall be $3.00 per
share (subject to a reduction of $2.25 if the proposed special cash
distribution of $2.25 per share on each share of
<PAGE>
Common Stock outstanding of record on January 11, 1996 is approved by the
Company's shareholders and payment thereof is made by the Company). The
purchase price of the Option Shares shall be paid at the time of exercise, as
provided in paragraph 3 hereof.
3. EXERCISE. The Option to purchase 10,000 shares of Common Stock
shall become exercisable for a period of four (4) years commencing on April 15,
1996.
The options may be exercised in whole or in part by delivering to the
Secretary of the Company (a) a written notice specifying the number of shares to
be purchased, and (b) payment in full of the exercise price, together with the
amount, if any, deemed necessary by the Company to enable it to satisfy any
income tax withholding obligations with respect to the exercise (unless other
arrangements, acceptable to the Company, are made for the satisfaction of such
withholding obligations). The exercise price shall be payable by bank or
certified check, or by such other method as the Board of Directors in its sole
discretion, shall determine.
4. TERMINATION. The Option terminates on April 14, 2000 and may not
be exercised under any circumstances thereafter.
5. RIGHTS AS STOCKHOLDER. No shares of Common stock shall be sold
or delivered hereunder until full payment for such shares has been made. The
Optionee shall have no rights as a stockholder with respect to any Option Shares
until a stock certificate for such shares is issued to him or her. Except as
otherwise provided in paragraphs 2 and 8 hereof, no adjustment shall be made for
dividends or distributions of other rights for which the record date is prior to
the date such stock certificate is issued.
6. NONTRANSFERABILITY. This Option is not assignable or
transferable except by will and/or the laws of descent and distribution, and is
exercisable during the Optionee's lifetime only by the Optionee. If the
Optionee shall die, his estate, personal representative, or
2
<PAGE>
beneficiary shall have the right, subject to the provisions of paragraph 4, to
exercise the Option at any time during the remainder of the term of the Option.
7. SECURITIES RESTRICTIONS. This Option may not be exercised unless
such exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and all other applicable securities laws, as are in effect on
the date of exercise. If the shares to be issued upon an exercise of the Option
are not registered under the Securities Act, then, as a further condition of the
Company's obligation to issue such shares, the Optionee may be required to give
a representation in writing that the Optionee is acquiring the shares for his
own account as an investment and not with a view to, or for sale in connection
with, the distribution of such shares, and the certificate representing such
shares shall bear a legend to such effect as the Company's counsel shall deem
necessary or desirable. If Optionee is an officer or director of the Company or
other person (in each case, an "INSIDER") whose transactions in the Company's
Common Stock are subject to Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the Company is subject to Section
16(b) of the Exchange Act, the shares acquired by Optionee upon exercise of this
Option may not be sold, transferred or otherwise disposed of by Optionee until
six (6) months after the date of grant of this Option.
8. CAPITAL CHANGES, REORGANIZATIONS, ETC.
(a) In case the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, or pay a dividend on, or make a
distribution of, shares of Common Stock or of the Company's capital stock
convertible into Common Stock, the exercise price per share of the Option Shares
and the number of Option Shares issuable upon exercise of this Option shall be
proportionately adjusted.
3
<PAGE>
(b) In case of any consolidation of the Company with, or merger
of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger which does not result in any reclassification or
change of the outstanding Common Stock), the corporation formed by such
consolidation or merger shall execute and deliver to the Optionee a supplemental
option agreement providing that the Optionee shall have the right thereafter
(until the expiration of such Option) to receive, upon exercise of such Option,
the kind and amount of shares of stock and other securities and property
receivable upon such consolidation or merger, by a holder of the number of
shares of Common Stock of the Company for which such Option might have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Such supplemental option agreement shall provide for adjustments which shall be
identical to the adjustments provided in this paragraph 8. The above provision
of this subsection shall similarly apply to successive consolidations or
mergers.
(c) The Company shall not be required to issue certificates
representing fractions of shares on the exercise of the Option, nor shall it be
required to issue scrip or pay cash in lieu of fractional interests, it being
the intent of the parties that all fractional interests shall be eliminated.
(d) All adjustments under this paragraph 8 shall be made by the
Board, and its determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive.
9. REGISTRATION RIGHTS.
(a) If at any time commencing after January 11, 1996 and
expiring on April 14, 2000, the Company proposes to register any of its
securities under the Act, it will give written notice by registered mail, at
least thirty (30) days prior to the filing of each such
4
<PAGE>
registration statement to the Optionee of its intention to do so. Upon the
written request of the Optionee given within ten (10) days after receipt of any
such notice of its or their desire to include any such Option Shares in such
proposed registration statement, the Company shall afford the Optionee the
opportunity to have any such Options Shares registered under such registration
statement.
Notwithstanding the provisions of this paragraph, the Company
shall have the right at any time after it shall have give written notice
pursuant to this paragraph 9 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date hereof.
If any registration pursuant to this paragraph 9 shall be
underwritten in whole or in part, the Company may require that the Option Shares
requested for inclusion pursuant to this paragraph 9 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s).
(b) In connection with any registration under this paragraph 9,
the Company and the Optionee hereby agree as follows:
(i) The Company shall pay all costs (excluding fees and expenses
of Optionee's counsel and any underwriting or selling commissions or other
charges of any broker-dealer acting on behalf of Optionee), fees and expenses in
connection with all registration statements filed pursuant to this paragraph 9,
including, without limitation, the Company's legal and accounting fees, printing
expenses, blue sky fees and expenses.
(ii) The Company will take all necessary action which may be
required in qualifying or registering the Option Shares included in a
registration statement for offering
5
<PAGE>
and sale under the securities or blue sky laws of such states as reasonably are
requested by the Optionee, provided that the Company shall not be obligated to
qualify as a foreign corporation to do business under the laws of any such
jurisdiction.
(iii) The Company shall indemnify the Optionee in connection with
Option Shares to be sold pursuant to any registration statement and each person,
if any, who controls such Optionee within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating, preparing or
defending against any claim whatsoever) to which any of them may become subject
under the Securities Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Option under the securities laws
thereof or filed with the Securities and Exchange Commission (the "Commission"),
any state securities commission or agency, the National Association of
Securities Dealers, Inc., The Nasdaq Stock Market or any securities exchange, or
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading, unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company by the Optionee
expressly for use in such registration statement, any amendment or supplement
thereto or any application, as the case may be. If any action is brought
against the Optionee or any controlling person of the Optionee in respect of
which indemnity may be sought against the Company pursuant to this paragraph 9,
the Optionee or such controlling person shall within
6
<PAGE>
thirty (30) days after the receipt thereby of a summons or complaint notify the
Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and payment of
reasonable fees and expenses of counsel (which counsel shall be reasonably
satisfactory to the Optionee or such controlling person), but the failure to
give such notice shall not affect such indemnified person's right to
indemnification hereunder except to the extent that the Company's defense of
such action was materially adversely affected thereby. The Optionee or such
controlling person shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of the Optionee or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action, the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the fees and expenses of not more than one additional firm of attorneys for the
Optionee and/or such controlling person shall be borne by the Company. Except
as expressly provided in the previous sentence, in the event that the Company
shall not previously have assumed the defense of any such action or claim, the
Company shall not thereafter be liable to the Optionee or such controlling
person in investigating, preparing or defending any such action or claim. The
Company agrees promptly to notify the Optionee of the commencement of any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the resale of the Option Shares or in
connection with such registration statement.
7
<PAGE>
(iv) The Optionee, and their successors and assigns, shall
severally, and not jointly, indemnify the Company, its officers, directors,
shareholders, employees or representatives and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against all loss, claim, damage or expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they may become
subject under the Securities Act, the Exchange Act or any other statute, common
law or otherwise, arising from information furnished in writing by or on behalf
of Optionee, or their successors or assigns, for specific inclusion in such
registration statement. The Optionee further agrees that upon demand by an
indemnified person, at any time or from time to time, they will promptly
reimburse such indemnified person for any loss, claim, damage, liability, cost
or expense actually and reasonably paid by the indemnified person as to which
the Optionee have indemnified such person pursuant hereto. Notwithstanding the
foregoing provisions of this paragraph 9, any such payment or reimbursement by
the Optionee of fees, expenses or disbursements incurred by an indemnified
person in any proceeding in which a final judgment by a court of competent
jurisdiction (after all appeals or the expiration of time to appeal) is entered
against the Company or such indemnified person as a direct result of the Company
or such person's gross negligence or willful misfeasance will be promptly repaid
to the Optionee.
(c) Nothing contained in this Agreement shall be construed as
requiring the Optionee to exercise their Option prior to the initial filing of
any registration statement or the effectiveness thereof.
8
<PAGE>
10. MISCELLANEOUS
(a) This agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(b) This agreement shall be governed by and construed in
accordance with the laws of the State of Florida. This agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and may not be modified except by written instrument executed by the
parties.
(c) Any dispute regarding the interpretation of this Option
shall be submitted by the Optionee or the Company to the Company's Board of
Directors, which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on the
Company and on Optionee.
IN WITNESS WHEREOF, this agreement has been executed as of the date
first above written.
BOCA RATON CAPITAL CORPORATION
By:
---------------------------------------------------
-------------------------------------------------------
Optionee
9
<PAGE>
EXHIBIT 22.2
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
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 Rule 14A-11(c) or Rule 14a-12
BOCA RATON CAPITAL CORPORATION
................................................................................
(Name of Registrant as Specified In Its Charter)
BOCA RATON CAPITAL CORPORATION
................................................................................
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] 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:
......................................................................
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.( )
......................................................................
4) Proposed maximum aggregate value of transaction:
......................................................................
5) Total fee paid:
......................................................................
[X] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
......................................................................
2) Form, Schedule or Registration Statement No.:
......................................................................
3) Filing party:
......................................................................
4) Date Filed:
......................................................................
- ----------------------
(1) Set forth the amount on which the filing fee is calculated and state
how it was determined.
<PAGE>
BOCA RATON CAPITAL CORPORATION
6516 VIA ROSA
BOCA RATON, FLORIDA 33433
________________________________________
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
IN LIEU OF THE ANNUAL MEETING
DECEMBER 15, 1995
________________________________________
To our Shareholders:
Notice is hereby given that a Special Meeting of Shareholders in lieu of
the Annual Meeting of Boca Raton Capital Corporation, a Florida corporation (the
"Company") will be held at 10:30 a.m., local time, on December 15, 1995 at The
Embassy Suites Hotel, 661 N.W. 53rd Street, Boca Raton, Florida (the "Meeting")
for the following purposes:
1. To elect two Class I directors to serve until the 1998 annual
meeting of shareholders and until their respective successors are elected
and qualified.
2. To consider and approve the withdrawal of the Company's election
of status as a business development company ("BDC") under the Investment
Company Act of 1940.
3. To consider and approve the appointment of Coopers & Lybrand
L.L.P. as the Company's independent auditors for the 1995 fiscal year.
4. To consider and transact such other business as may properly come
before the Meeting or any adjournment or postponement thereof.
Only holders of common stock of record at the close of business on
November 10, 1995 are entitled to notice of and to vote at the Meeting or any
adjournment or postponement thereof.
BY ORDER OF THE BOARD OF DIRECTORS
Franklyn B. Weichselbaum
Secretary
Dated: November 20, 1995
IN ORDER TO ASSURE THE PRESENCE OF A QUORUM AND THEREBY AVOID UNNECESSARY
EXPENSE TO ALL SHAREHOLDERS, YOU ARE REQUESTED, IF YOU WILL BE UNABLE TO ATTEND
THE MEETING IN PERSON, TO SIGN AND TO DATE THE ENCLOSED PROXY BALLOT (REGARDLESS
OF THE AMOUNT OF YOUR HOLDINGS) AND TO MAIL IT PROMPTLY IN THE ENCLOSED RETURN
ENVELOPE. IT REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF YOU ARE
PRESENT AT THE MEETING, YOU MAY VOTE IN PERSON REGARDLESS OF HAVING SENT YOUR
PROXY.
<PAGE>
BOCA RATON CAPITAL CORPORATION
6516 VIA ROSA
BOCA RATON, FLORIDA 33433
SPECIAL MEETING OF SHAREHOLDERS
IN LIEU OF THE ANNUAL MEETING
DECEMBER 15, 1995
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Boca Raton Capital Corporation, a Florida
corporation (the "Company"), for use at the Special Meeting of Shareholders in
lieu of the Annual Meeting (the "Meeting") to be held at 10:30 a.m., local time,
on December 15, 1995 at The Embassy Suites Hotel, 661 N.W. 53rd Street, Boca
Raton, Florida, or any adjournment or postponement thereof. The purposes of the
Meeting and the matters to be acted upon are: (i) to elect two Class I
directors; (ii) to consider and approve the withdrawal of the Company's election
of status as a business development company ("BDC") under the Investment Company
Act of 1940 (the "1940 Act"); (iii) to consider and approve the Board of
Directors' appointment of Coopers & Lybrand L.L.P. as the Company's independent
auditors for the 1995 fiscal year; and (iv) to consider and transact such other
business as may properly come before the Meeting or any adjournment or
postponement thereof.
Abstentions will be considered as shares present and entitled to vote at
the Meeting for purposes of determining whether a quorum is present and will be
counted as votes cast at the Meeting, but will not be counted as votes cast
"for" or "against" any given matter. Broker non-votes will be treated as shares
present and entitled to vote at the Meeting for purposes of determining whether
a quorum is present. However, broker non-votes will not be considered as votes
cast at the Meeting.
The close of business on November 10, 1995 has been fixed as the record
date for the determination of Shareholders entitled to notice of, and to vote
at, the Meeting and at any adjournment or postponement thereof. On that date,
the Company had 1,125,283 shares of common stock $.001 par value per share
("Common Stock"), outstanding held by 613 holders of record. Each share will be
entitled to one vote at the Meeting. The Notice of Meeting, Proxy Statement and
form of Proxy are first being mailed to Shareholders on or about November 20,
1995.
The date of this Proxy Statement is November 20, 1995.
<PAGE>
I. ELECTION OF DIRECTORS
A majority of outstanding shares of the Common Stock represented in person
or by proxy shall constitute a quorum at the Meeting. If a quorum is present,
an affirmative vote of a majority of the holders of issued and outstanding
shares of Common Stock present either in person or by proxy at the Meeting is
required for the election of each nominated director. If the Company's
shareholders vote to approve the election of each of the nominated directors,
the election of the nominated directors would become effective upon the
adjournment of the Meeting. Shares represented by a properly signed, dated and
returned proxy are considered as shares present at the Meeting for purposes of
determining a quorum.
In accordance with Article VI, Section 1 of the Company's Amended and
Restated Articles of Incorporation, the Board of Directors of the Company
(sometimes referred to herein as the "Board") is divided into three classes,
designated Class I, Class II and Class III. The current term of Class I
directors extends to the date of the Meeting, that of Class II extends to the
1996 annual meeting and that of Class III to the 1997 annual meeting. The term
of the Class I directors elected at the Meeting will extend to the 1998 annual
meeting. Each class, upon election, serves for a three-year term.
Each of the persons named in the accompanying form of Proxy will vote the
shares of Common Stock represented thereby in favor of the nominees listed in
the table under "Certain Information Concerning Nominees" unless otherwise
instructed in such Proxy. In case any of the nominees is unable or declines to
serve, such persons reserve the right to vote the shares of Common Stock
represented by such Proxy for another person duly nominated by the Board of
Directors in such nominee's stead. Each of the nominees has agreed to serve as
a director, if elected. The Board of Directors has no reason to believe that
any of the persons named will be unable or will decline to serve. The Board has
unanimously approved each of the nominees named below.
Certain information concerning the nominees for election as Class I
directors is set forth below. Such information was furnished by them to the
Company.
-2-
<PAGE>
CERTAIN INFORMATION CONCERNING NOMINEES FOR CLASS I DIRECTORS
Business Experience and
Nominees for Election Age Directorships During Past Five Years
--------------------- --- ------------------------------------
Ronald L. Miller 51 Ronald L. Miller was elected a Class I
director of the Company in February 1995.
Mr. Miller is the founder of Miller Advisory
Corp., an investment banking firm, and has
served as President of Miller Advisory
Group, since 1989. Mr. Miller is Chairman
of the Board of Provider Solutions, Inc., a
healthcare computer software company; and a
director of Pollo Tropical, Inc., a publicly
traded company which operates grilled
chicken restaurants.
Alan H. Weingarten 55 Alan H. Weingarten was elected a Class I
director of the Company in February 1995.
Mr. Weingarten has served as Chief Executive
Officer of Alan H. Weingarten & Associates,
Inc., a general management, marketing,
product planning and consulting organization
since 1986. Mr. Weingarten is a director of
Lumex Inc., a publicly traded company, and a
member of Lumex Inc.'s audit, compensation
and director affairs committees. Mr.
Weingarten is a member of the Company's
Audit Committee.
CLASS II DIRECTOR WHOSE TERM EXPIRES IN 1996
Business Experience and
Name Age Directorships During Past Five Years
--------------------- --- ------------------------------------
Robert H. Arnold 51 Robert H. Arnold was elected a Class II
director of the Company in February 1995.
Mr. Arnold is the founder of R.H. Arnold &
Co., an investment banking firm, and has
served as the President of R.H. Arnold & Co.
since 1989. Mr. Arnold is a director of R.
H. Arnold & Co.; an independent General
Partner of Fiduciary Capital Partners, a
U.S. public mezzanine fund; a Managing
Director of HC Capital Partners China, an
international investment company; an advisor
to Mezzanine Management Limited, an
investment management firm; a director of
Covenant Investment Management, an
investment company; a director of Eagle
Finance Corp.; a director of Covenant
Holding; a director of Phoenix Four, Inc.;
and a Trustee of the Philadelphia-based Tax-
Exempt Housing Reserve Fund.
CLASS III DIRECTORS WHOSE TERMS EXPIRE IN 1997
Business Experience and
Name Age Directorships During Past Five Years
--------------------- --- ------------------------------------
Alan L. Jacobs* 53 Alan L. Jacobs was elected a Class III
director of the Company in February 1995.
Mr. Jacobs had previously served as a
director of the Company from July 1993 to
September 1994; as the Chairman of the Board
of the Company from November 1993 to
September 1994 and became the President and
Chief Executive Officer of the Company in
November 1993. Since January 1992, Mr.
Jacobs also has been Associate Director of
Investment Banking for Josephthal Lyon &
Ross Incorporated, an investment banking
firm ("Josephthal"). From May 1985 to
December 1991, Mr. Jacobs was Managing
Director, Investment Banking, with Ladenburg
Thalmann & Co., Inc., an investment banking
firm.
C. Lawrence Rutstein 51 C. Lawrence Rutstein was elected as a Class
III director of the Company in February
1995. Mr. Rutstein has been counsel to the
law firm, Ronald Bluestein & Associates
since 1993. Mr. Rutstein is also the
Chairman of The Rittenhouse Group, Inc., a
private consulting company. From 1991 to
1993, Mr. Rutstein was the General Partner
and Vice President of Memphis Chicks
Baseball Club, an AA Affiliate of the Kansas
City Royals. From 1989 to 1991, Mr.
Rutstein served as Chairman of the Board of
Cedar Group, Inc., a publicly traded company
which imported and distributed industrial
fasteners. Mr. Rutstein is a member of the
Company's Audit Committee.
* Indicates "Interested Person," as defined in the 1940 Act."
During fiscal year 1994, the Board of Directors of the Company did not
meet. All actions by the Board during fiscal year 1994 were taken pursuant to
unanimous written consents of the Board of Directors.
-3-
<PAGE>
The Company's By-laws include provisions, authorized by Florida law, which
require the Company to indemnify directors and officers of the Company against
certain liabilities and reasonable expenses incurred by reason of his/her being
or having been a director or an officer of the Company or for an act alleged to
have been committed by such director or officer in his/her capacity as a
director or officer of the Company.
All rights to indemnification and advances shall be deemed to be a contract
between the Company and each indemnified person who serves or served in such
capacity at any time while such indemnification provisions were in effect and,
as such, are enforceable against the Company. The Company also maintains
director and officer liability insurance.
EXECUTIVE OFFICERS
The following table sets forth information with respect to the executive
officers of the Company.
Name Age Position Held
---- --- -------------
Alan L. Jacobs 53 Chief Executive Officer and
President
Franklyn B. Weichselbaum 50 Treasurer, Secretary and
Chief Financial Officer
The principal occupation of Mr. Jacobs is discussed under "Class III
Directors Whose Terms Expire in 1997."
Franklyn B. Weichselbaum has been a consultant to the Company since May
1990; was elected Treasurer and Chief Financial Officer in November 1993 and
Secretary of the Company in March 1995. Mr. Weichselbaum served as a consultant
to Weitzer Homebuilders Incorporated ("WHB"), a publicly traded company engaged
in the design and construction of single-family residences, from October 1994
until August 1995. Mr. Weichselbaum also served as a consultant to RailAmerica,
Inc. ("RailAmerica"), a publicly held transportation holding company, from
May 1990 to March 31, 1994. Mr. Weichselbaum is a certified public accountant.
During the fourth quarter of 1993, the Company ceased active business
operations; therefore, the officers of the Company provide their services on an
as needed basis.
CERTAIN FILINGS
Section 16(a) of the Securities Exchange Act of 1934 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 Commission
initial reports of ownership and reports of changes in ownership of Common Stock
and other equity securities of the Company. Directors, officers and greater
than ten percent stockholders are required by Commission regulation to furnish
the Company with copies of all Section 16(a) forms they file.
Based on a review of such timely filed forms received by it and
representations by persons that would be required to file such forms, the
Company believes that all required filings by current executive officers and
directors have been timely filed, except that the Form 3 of each of Messrs.
Arnold, Miller, Rutstein and Weingarten was filed late.
-4-
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth the remuneration for services in all
capacities to the Company for the year ended December 31, 1994, of the
directors, the two highest paid executive officers, and all directors and
officers of the Company as a group, who received, during fiscal year ending
December 31, 1994, aggregate remuneration in excess of $60,000.
<TABLE>
<CAPTION>
Pension or
Retirement
Benefits
Capacities in Accrued Estimated
which as Part of Annual
Remuneration Aggregate Company's Benefits Upon
Name Received Remuneration Expenses Retirement
---- -------- ------------ -------- ----------
<S> <C> <C> <C> <C>
Alan L. Jacobs(1) President and Chief $ --- N/A N/A
Executive Officer
Franklyn B. Weichselbaum(2) Chief Financial $96,400 N/A N/A
Officer, Secretary
and Treasurer
All directors and officers as a $96,400 N/A N/A
group (12 persons)
</TABLE>
- ------------------------
(1) Mr. Jacobs received no compensation from the Company for his services as
President and Chief Executive Officer to the Company prior to March 1995. Mr.
Jacobs' employer, Josephthal, received $3,000 a month in consulting fees or an
aggregate of $36,000 from the Company in 1994. As of March 1995, the Company
agreed to pay Mr. Jacobs, as President and Chief Executive Officer, $3,000 a
month.
(2) The Company paid Mr. Weichselbaum $2,200 per month or an aggregate of
$26,400 in consulting fees in 1994. The Company paid Mr. Weichselbaum an
additional $70,000 in 1994 for consulting services he rendered to the Company in
connection with the Terminated Merger (as hereinafter defined). As of March
1995, the Company agreed to pay Mr. Weichselbaum as Chief Financial Officer,
Secretary and Treasurer of the Company, $2,200 per month.
DIRECTOR REMUNERATION
Directors did not receive cash compensation from the Company for
serving as such during fiscal year ended December 31, 1994; however, they were
entitled to reimbursement for certain out-of-pocket expenses. Commencing in
February 1995, directors are entitled to receive $1,500 per meeting attended and
reimbursement for certain out-of-pocket expenses for serving as such. Members
of the Audit Committee were also entitled to receive $1,500 per Audit Committee
meeting attended and reimbursement for certain out-of-pocket expenses for
serving as such.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Alan L. Jacobs, President and Chief Executive Officer of the Company,
is employed by Josephthal. In addition, Dan Purjes, a managing director of
Josephthal, is a shareholder of the Company and Josephthal Holdings, Inc. the
parent company of Josephthal ("Josephthal Holdings"). The Company and
Josephthal were parties to a financial consulting agreement dated March 2, 1993
pursuant to which the Company paid Josephthal $3,000 a month in consulting fees
from March 1993 until February 1995. The Company paid such monthly fee for
services provided by Josephthal which included advice to, and consulting with,
the Company concerning financial planning, corporate organization and structure,
financial matters in connection with operation of the business of the Company,
private and public equity and debt financing, acquisitions, mergers and other
-5-
<PAGE>
similar business combinations, and periodic analysis of the Company's financial
statements. Alan L. Jacobs, the Company's President and Chief Executive
Officer, was not compensated directly by the Company for services rendered as an
officer of the Company prior to March 1995. However, Mr. Jacobs was compensated
by Josephthal. The $3,000 monthly fee is consistent with fees that Josephthal
receives for providing similar financial consulting services to other small
public entities. In addition, the consulting agreement obligated the Company to
pay Josephthal a contingent transaction fee equal to two percent (2%) of the
amount of any financing or value of any transaction in connection with which
Josephthal, at the written request of the Company, rendered advisory services to
the Company, but the source of the financing or transaction is not Josephthal.
The Company also was required to pay Josephthal contingent transaction fees for
financings or transactions introduced to the Company by Josephthal as agreed to
on a transaction-by-transaction basis. The consulting agreement was for a five
year term ending December 31, 1997, except that, after July 1, 1993, the
agreement was subject to termination by either party upon thirty days' prior
written notice. In March 1995, the consulting agreement was terminated by the
Company. In addition, as of March 1995, the Company agreed to pay Mr. Jacobs,
as President and Chief Executive Officer, $3,000 a month. In connection with a
proposed merger which was not consummated (the "Terminated Merger") by and among
the Company, Harry Weitzer, WHB, WHB Merger Sub, Inc. ("Sub") and certain
corporations controlled by Harry Weitzer (the "Weitzer Entities"), the Company
in March 1994 paid Josephthal a $150,000 fee pursuant to the consulting
agreement. The fee charged by Josephthal relating to the Terminated Merger was
calculated after a review of standard merger and acquisition fee formulas for
similar transactions, and discounted due to the financial consulting agreement.
The Weitzer Entities terminated the proposed merger on December 23, 1994, and
Josephthal returned the $150,000 fee to the Company. On June 30, 1994,
consistent with the Company's investment policies, the Company extended a one-
year loan (the "Weitzer Loan") to Weitzer Financial, Inc., an entity controlled
by Harry Weitzer. The Weitzer Loan was in the principal amount of $500,000 with
an interest rate equal to the prime rate plus 1%. The principal and accrued
interest thereon, of the Weitzer Loan was repaid in the aggregate amount of
approximately $547,000 in July 1995.
In lieu of certain consulting fees owed to Josephthal, the Company in
1993 issued 13,750 shares of Common Stock to Josephthal which in turn
distributed the shares to certain Josephthal employees and stockholders.
Josephthal provided financial consulting services for nine months during 1992
pursuant to a prior financial consulting agreement between the Company and
Josephthal entered into in April 1992. At December 1992, the fees for such
services, aggregating $27,000, remained unpaid and, in January 1993, an
agreement was reached between the Company's former management and Josephthal to
settle the obligation through the issuance of 13,750 shares of the Company's
Common Stock, the high bid price of which was then $2.00 per share. However,
the Company did not issue the shares until several months later, at which time
the average of the high bid and ask prices was approximately $4.00 per share.
Therefore, the Company recorded an expense for consulting fees of approximately
$55,000 (13,750 x $4.00). For purposes of recording the expense, the Company
should have valued the shares at the time of settlement, using the same method
of valuation. However, the obligation owed and the difference in valuation of
the shares were not considered material to its consolidated financial position
or results of operations. The services provided by Josephthal from April 1992
through December 1992 included, but were not limited to, advice to, and
consulting with, the Company concerning financial planning, corporate
organization and structure, financial matters in connection with operation of
the business of the Company, private and public equity and debt financing,
acquisitions, mergers and other similar business combinations, and periodic
analysis of the Company's financial statements. Josephthal also received
approximately $166,000 in placement agent fees in connection with a private
placement by the Company in June 1993 of 828,346 shares of Common Stock to
private investors, including certain officers and directors of the Company, at
$2.20 per share (adjusted for a one-for-ten reverse
-6-
<PAGE>
stock split effected in June 1993) (the "1993 Private Placement"). Josephthal's
placement agent fee for the 1993 Private Placement equalled 5% of the funds
raised from the Company's officers and directors and 10% of all other funds
raised. This fee arrangement was consistent with placement fees received by
Josephthal in similar transactions.
As part of the termination of employment of Gary O. Marino, a former
executive officer of the Company, the Company assigned its ownership of 50% of
the issued and outstanding common stock of HTG to Mr. Marino in September 1993.
In November 1993, the Company transferred certain furniture and fixtures to HTG
in exchange for certain amounts advanced by HTG to the Company pursuant to a
consulting agreement between HTG and the Company. These termination
arrangements are not considered material to the Company's financial position or
results of operations.
The Company paid Mr. Franklyn Weichselbaum $2,200 per month in
consulting fees from July 1993 until February 1995. The $2,200 per month fee
was negotiated between the Company and Mr. Weichselbaum and was determined by
estimating the amount of time to be provided by Mr. Weichselbaum in connection
with his services as Treasurer and Chief Financial Officer of the Company. In
addition, the Company agreed to pay additional fees to Mr. Weichselbaum for
services provided by Mr. Weichselbaum which the Company believed were not in the
ordinary course of business, such as those rendered in connection with
performing due diligence and other consulting services in connection with the
Terminated Merger. The Company paid Mr. Weichselbaum an aggregate of $70,000 in
1994 for the consulting services he rendered in connection with the Terminated
Merger. The amount of this fee was determined based upon the complexity of work
and the amount of time expended by Mr. Weichselbaum. Commencing in March 1995,
the Company agreed to pay Mr. Weichselbaum, as Chief Financial Officer,
Secretary and Treasurer of the Company, $2,200 per month.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number of shares and percentage
owned of the Common Stock beneficially owned as of October 31, 1995 by (i)
owners of more than five percent of the Common Stock, (ii) each director of the
Company, (iii) each nominee of the Company, (iv) each "named executive officer"
of the Company and (v) all officers and directors of the Company as a group.
<TABLE>
<CAPTION>
Name and Address of
Beneficial Owners(1) Number of Shares Percentage Owned
-------------------- ---------------- ----------------
<S> <C> <C>
William B. Tanner(2) 165,600 14.7
2076 Union Avenue
P.O. Box 40769
Memphis, Tennessee 38174
Dan Purjes(3) 166,832 14.8
c/o Josephthal Lyon & Ross
Incorporated
200 Park Avenue, 24th Floor
New York, New York 10166
Franklyn B. Weichselbaum 0 *
6516 Via Rosa
Boca Raton, Florida 33433
-7-
<PAGE>
Alan L. Jacobs 7,562 *
c/o Josephthal Lyon & Ross
Incorporated
200 Park Avenue, 24th Floor
New York, New York 10166
Ronald L. Miller 0 *
c/o Miller Advisory Corp.
2601 Heron Lane N.
Clearwater, Florida 34622
Alan H. Weingarten 4,000 *
c/o Alan H. Weingarten &
Associates, Inc.
21759 Club Villa Terrace
Boca Raton, Florida 33433
Robert H. Arnold 0 *
c/o R.H. Arnold & Co.
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
C. Lawrence Rutstein 0 *
c/o The Rittenhouse Group, Inc.
430 1617 JFK Blvd.
Philadelphia, Pennsylvania 19103
All officers and directors as a group 11,562 *
(6 persons)
</TABLE>
- -----------------------
* Less than 1%.
(1) Unless otherwise indicated, each person listed above has sole voting power
and sole investment power with respect to the shares owned by such person.
(2) Includes (a) 23,000 shares held by WBT Holding Co., Inc., an entity
controlled by Mr. Tanner; (b) 11,500 shares held by Mr. Tanner as custodian for
Weatherly Blake, Mr. Tanner's son; (c) 4,600 shares held by Mr. Tanner as
custodian for William Taylor Tanner, Mr. Tanner's grandson; (d) 11,500 shares
held by Crystal Tanner, Mr. Tanner's daughter; and (e) 11,500 shares held by
William B. Tanner, Jr., Mr. Tanner's son. Mr. Tanner disclaims beneficial
ownership of all of these shares.
(3) Includes (a) 2,500 shares owned by his minor children; (b) 48,166 shares
owned by his spouse; (c) 3,000 shares held in his profit sharing plan account;
(d) 1,000 shares held in his IRA; (e) 35,000 shares owned by Josephthal
Holdings, of which Mr. Purjes is an executive officer, director and principal
shareholder; and (f) 11,500 shares owned by the Josephthal Profit Sharing Plan,
of which Mr. Purjes has the authority to appoint and discharge its trustees.
Mr. Purjes disclaims beneficial ownership of the shares held by his spouse,
Josephthal Holdings and the Josephthal Profit Sharing Plan.
-8-
<PAGE>
BROKERAGE
The Company's primary investment objective has been to seek long-term
capital appreciation by making debt and equity investments in established and
emerging operating companies. In addition, as a secondary investment objective,
the Company sought to provide services to its investee companies in return for
management and transaction fees and to maximize income from dividends and
interest. The Company's investments have taken the form of equity securities,
usually common stock, and/or debt, which may be convertible into equity
securities or be accompanied by warrants or options to purchase equity
securities. Purchase and sale orders may be executed with any number of
brokers, and will be placed with a view toward receiving the best price and
execution. The Company checks the rates of Commission that it pays to brokers
to ascertain that they are competitive with those charged by other brokers for
similar services. The Company may place brokerage orders with Josephthal, an
"affiliated" person with respect to the Company under the Act. The Company's
policy requires that the commissions paid to Josephthal be reasonable and fair
compared with commissions received by other brokers in connection with
comparable transactions involving similar securities being purchased or sold
during a comparable period of time. During the fiscal year-ended December 31,
1994, the Company did not incur any brokerage commissions. During fiscal year-
ended December 31, 1995, the Company incurred aggregate brokerage commissions of
approximately $13,300. All of such brokerage commissions were paid to
Josephthal.
II. WITHDRAWAL OF ELECTION OF COMPANY'S STATUS AS A
BUSINESS DEVELOPMENT COMPANY
The Company, a closed-end management investment company, has elected
status as a BDC as that term is defined in the 1940 Act. As such, the Company
although not subject to the provisions of the 1940 Act relating to registered
investment companies is nonetheless subject to a number of provisions under the
1940 Act relating to BDC's. The Board of Directors of the Company unanimously
determined at a meeting held on October 12, 1995, that it would be in the best
interest of the Company and its shareholders to seek shareholder approval to
withdraw the Company's election as a BDC. Specifically, Section 58 of the 1940
Act states that no BDC shall, unless authorized by a vote of a majority of its
outstanding voting securities, change the nature of its business so as to cease
to be, or withdraw its election as, a business development company.
Accordingly, the Board has authorized the solicitation of shareholder approval
to effectuate this withdrawal.
The Board determined that a withdrawal of election as a BDC is in the
best interest of the Company because of the Company's current financial and
operational structure. Specifically, the Company currently holds one portfolio
security, RailAmerica, Inc. ("RailAmerica") common stock, and the balance of its
investments are in cash or cash equivalents. Also, the Company's total assets,
as of September 30, 1995 were approximately $4.1 million. Because of the
relative size of the Company's asset base to its ongoing expenses, the Board
believes the shareholders' return on assets is not sufficient to continue
operations as a BDC. The Board does not feel it is practical to attempt to
raise additional capital for the Company and alternatively believes that the
Company would best be suited to continue its operations subsequent to a merger
with an operating company. Therefore, the Company intends to seek shareholder
approval to withdraw its status as a BDC.
The Board will also, subsequent to receipt of shareholder approval, to
withdraw the Company's BDC election, pass a resolution in accordance with Rule
3a-2 under the 1940 Act whereby the Company will not be deemed to be engaged in
the business of investing, reinvesting,
-9-
<PAGE>
owning, holding or trading in securities during a period of time (not to exceed
one year) and that the Company has a bona fide intent to be engaged primarily,
as soon as is reasonably possible (in any event by the termination of such
period of time), in a business other than that of investing, reinvesting,
owning, holding or trading in securities. By withdrawing election of status as
a BDC and adopting a resolution pursuant to Rule 3a-2 the Company would not be
considered either a registered investment company nor an investment company
electing BDC status. Shareholders are reminded that once the Company
successfully withdraws its election as a BDC it will no longer be subject to the
regulatory provisions of the 1940 Act relating to BDC operations, including
insurance, custody, composition of the board, affiliated transactions and
compensation arrangements. The Board of Directors determined that the
withdrawal of election of status as a BDC would reduce the ongoing operating
expenses of the Company. Consequently, the Company would be better positioned
to pursue a merger candidate. The Board believes a merger candidate would be
attracted to the assets in the Company in addition to its public shareholder
base.
The affirmative vote of a "majority of the outstanding voting
securities" of the Company is required for the approval of this proposal. As
defined by the 1940 Act, the term "majority of the outstanding voting
securities" means the vote of (a) 67% or more of the voting securities present
at the Meeting, if the holders of more than 50% of the outstanding voting
securities of the Company are present or represented by proxy or (b) more than
50% of the outstanding voting securities of the Company, whichever is less. If
the Company's shareholder's vote to approve the withdrawal of the Company's
election of status as a BDC, such withdrawal shall become effective upon the
Commission's receipt of the Company's notice of election of withdrawal.
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE APPROVAL OF
WITHDRAWAL OF THE COMPANY'S ELECTION OF STATUS AS A BUSINESS DEVELOPMENT
COMPANY.
III. APPROVAL OF APPOINTMENT OF AUDITORS FOR 1995
The Board, upon recommendation of its Audit Committee, has appointed
Coopers & Lybrand L.L.P. to serve as the Company's independent auditors for
1995, subject to the approval of the shareholders. The firm has audited the
financial records of the Company since 1989. The Board considers the firm to be
well qualified.
The affirmative vote of a majority of the holders of shares present
either in person or by proxy at the Meeting is required for the approval of this
proposal.
THE BOARD UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE APPROVAL OF COOPERS
& LYBRAND L.L.P. AS INDEPENDENT AUDITORS OF THE COMPANY FOR 1995.
IV. OTHER MATTERS
The Board of Directors of the Company does not know of any other
matters which may be brought before the Meeting. However, if any such other
matters are properly presented for action, it is the intention of the persons
named in the accompanying form of Proxy to vote the shares represented thereby
in accordance with their judgment on such matters.
-10-
<PAGE>
V. DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS FOR
1995 ANNUAL MEETING
Under the Commission's proxy rules, shareholder proposals that meet
certain conditions may be included in the Company's proxy statement and proxy
for a particular annual meeting. Proposals of shareholders that are intended to
be presented by such shareholders at the Company's 1995 Annual Meeting must be
received by the Company no later than August 1, 1996 to be considered for
inclusion in the proxy statement and form of proxy relating to that meeting.
Receipt by the Company of any such proposal from a qualified shareholder in a
timely manner will not ensure its inclusion in the Company's proxy material
because there are other requirements in the proxy rules for such inclusion.
VI. MISCELLANEOUS
If the accompanying form of Proxy is executed properly and returned,
the shares represented thereby will be voted at the Meeting in accordance with
the instructions on the Proxy, unless the Proxy is revoked. If no instructions
are indicated in such Proxy, the shares represented thereby will be voted FOR
the election of Ronald L. Miller, FOR the election of Alan H. Weingarten, FOR
the withdrawal of the Company's election of status as a BDC, FOR the approval of
Coopers & Lybrand L.L.P. as the Company's independent auditors for the 1995
fiscal year, and in the discretion of the Proxy holders as to any other matter
which may properly come before the Meeting. Any Shareholder who has given a
Proxy may revoke such Proxy at any time prior to its exercise at the Meeting by
(i) giving written notice of the revocation to Franklyn B. Weichselbaum, as
Secretary of the Company, (ii) properly submitting to Franklyn B. Weichselbaum,
as Secretary of the Company, a duly executed Proxy bearing a later date, or
(iii) attending the Meeting and voting in person. Attendance at the Meeting
will not in and of itself revoke a Proxy. All written notices of revocation and
other communications with respect to revocation of Proxies should be addressed
as follows: Franklyn B. Weichselbaum, Secretary, Boca Raton Capital Corporation,
6516 Via Rosa, Boca Raton, Florida 33433.
All costs relating to the solicitation of Proxies will be borne by the
Company. Proxies may be solicited by the officers of the Company personally, by
mail or by telephone or telegraph, and the Company may pay brokers and other
persons holding shares of stock in their names or those of their nominees for
their reasonable expenses in sending soliciting material to their principals.
Copies of the 1994 Annual Report of the Company are being mailed to
shareholders, together with this Proxy Statement, form of Proxy and Notice of
Special Meeting of Shareholders in Lieu of Annual Meeting. Additional copies
may be obtained from the Secretary of the Company, 6515 Via Rosa, Boca Raton,
Florida 33433.
BY ORDER OF THE BOARD OF DIRECTORS
Franklyn B. Weichselbaum
Secretary
Boca Raton, Florida
November 20, 1995
-11-
<PAGE>
BOCA RATON CAPITAL CORPORATION
6516 VIA ROSA
BOCA RATON, FLORIDA 33433
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF BOCA
RATON CAPITAL CORPORATION (the "Company"). The undersigned hereby appoints Alan
L. Jacobs and Franklyn B. Weichselbaum as Proxies, each with the power to
appoint his/her substitute; and hereby authorizes them, or any of them, to
represent and vote as designated below, all the shares of common stock of the
Company held of record by the undersigned on November 10, 1995 at the Special
Meeting of Shareholders in lieu of the Annual Meeting to be held on December 15,
1995, or any adjournment or postponement thereof.
PROPOSALS
1. (a) Election of Ronald L. Miller as Class I Director to serve until the
date of the 1998 annual meeting and until a successor has been elected
and qualified.
/ / FOR Ronald L. Miller / / WITHHOLD AUTHORITY to vote
for Ronald L. Miller
(b) Election of Alan H. Weingarten as Class I Director to serve until the
date of the 1998 annual meeting and until a successor has been elected
and qualified.
/ / FOR Alan H. Weingarten / / WITHHOLD AUTHORITY to vote
for Alan H. Weingarten
2. Withdrawal of election of status as a business development company under
the Investment Company Act of 1940.
/ / FOR withdrawal of election / / AGAINST withdrawal of election
/ / ABSTENTION with respect to
withdrawal of election
3. Appointment of Coopers & Lybrand L.L.P. as the Company's independent
auditors for the 1995 fiscal year.
/ / FOR Coopers & Lybrand L.L.P. / / AGAINST Coopers & Lybrand L.L.P.
/ / ABSTENTION with respect to
Coopers & Lybrand L.L.P.
The undersigned hereby instructs the above named proxies or their
substitutes to vote, in their discretion, upon such other matters which may
properly come before the meeting or any adjournment or postponement
thereof.
This proxy, when properly executed, will be voted in the manner
directed herein by the undersigned shareholder. If you execute and return
this proxy but do not specify otherwise, this proxy will be voted FOR the
election of Ronald L. Miller, FOR the election of Alan H. Weingarten, FOR
withdrawal of election of status as a business development company under
the Investment Company Act of 1940 and FOR appointment of Coopers &
Lybrand L.L.P.
TO VOTE WITH THIS PROXY BALLOT, FILL IN THE BOX TO THE LEFT OF YOUR VOTE FOR
EACH PROPOSAL THEN SIGN, DATE AND RETURN THIS BALLOT IN THE ENVELOPE PROVIDED.
Boca Raton Capital Corporation
Please sign exactly as the name appears below. When shares are held by joint,
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give the full title as such. If a corporation,
please sign the full corporate name by the President or other authorized
officer. If a partnership, please sign in the partnership name by an authorized
person.
PLEASE SIGN AND DATE BELOW:
Dated: , 1995
---------------------------------------------
- -------------------------------------------------------------
- -------------------------------------------------------------
Signature(s) of Shareholder(s)
<PAGE>
EXHIBIT 22.3
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
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 Rule 14A-11(c) or Rule 14a-12
BOCA RATON CAPITAL CORPORATION
................................................................................
(Name of Registrant as Specified In Its Charter)
BOCA RATON CAPITAL CORPORATION
................................................................................
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the Appropriate box):
[ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] 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:
................................................................
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.(1)
................................................................
4) Proposed maximum aggregate value of transaction:
................................................................
5) Total fee paid:
................................................................
[X ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
................................................................
2) Form, Schedule or Registration Statement No.:
................................................................
3) Filing Party:
................................................................
4) Date Filed:
................................................................
- -------------------------
(1) Set forth the amount on which the filing fee is calculated and state how
it was determined.
<PAGE>
BOCA RATON CAPITAL CORPORATION
6516 VIA ROSA
BOCA RATON, FLORIDA 33433
----------------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
FEBRUARY 29, 1996
----------------------------------
To our Shareholders:
Notice is hereby given that a Special Meeting of Shareholders of Boca
Raton Capital Corporation, a Florida corporation (the "Company") will be held at
10:30 a.m., local time, on February 29, 1996 at The Embassy Suites Hotel, 661
N.W. 53rd Street, Boca Raton, Florida (the "Meeting") for the following
purposes:
1. To consider and approve a special cash distribution of $2.25
per share of common stock of the Company, $.001 par value per share
("Common Stock"), payable, out of the Company's capital surplus, on each
share of the Common Stock outstanding of record at the close of business
on January 11, 1996.
2. To consider and transact such other business as may properly
come before the Meeting or any adjournment or postponement thereof.
Only holders of Common Stock of record at the close of business on
January 11, 1996 are entitled to notice of and to vote at the Meeting or any
adjournment or postponement thereof.
BY ORDER OF THE BOARD OF DIRECTORS
Franklyn B. Weichselbaum
Secretary
Dated: February 6, 1996
IN ORDER TO ASSURE THE PRESENCE OF A QUORUM AND THEREBY AVOID UNNECESSARY
EXPENSE TO ALL SHAREHOLDERS, YOU ARE REQUESTED, IF YOU WILL BE UNABLE TO ATTEND
THE MEETING IN PERSON, TO SIGN AND TO DATE THE ENCLOSED PROXY BALLOT (REGARDLESS
OF THE AMOUNT OF YOUR HOLDINGS) AND TO MAIL IT PROMPTLY IN THE ENCLOSED RETURN
ENVELOPE. IT REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF YOU ARE
PRESENT AT THE MEETING, YOU MAY VOTE IN PERSON REGARDLESS OF HAVING SENT YOUR
PROXY.
<PAGE>
BOCA RATON CAPITAL CORPORATION
6516 VIA ROSA
BOCA RATON, FLORIDA 33433
SPECIAL MEETING OF SHAREHOLDERS
FEBRUARY 29, 1996
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Boca Raton Capital Corporation, a Florida
corporation (the "Company"), for use at the Special Meeting of Shareholders (the
"Meeting") to be held at 10:30 a.m., local time, on February 29, 1996 at The
Embassy Suites Hotel, 661 N.W. 53rd Street, Boca Raton, Florida, or any
adjournment or postponement thereof. The purposes of the Meeting and the matters
to be acted upon are: (i) to consider and approve a special cash distribution of
$2.25 per share of common stock of the Company, $.001 par value per share
("Common Stock"), payable, out of the Company's capital surplus, on each share
of Common Stock outstanding of record at the close of business on January 11,
1996; and (ii) to consider and transact such other business as may properly come
before the Meeting or any adjournment or postponement thereof.
Abstentions will be considered as shares present and entitled to vote at
the Meeting for purposes of determining whether a quorum is present and will be
counted as votes cast at the Meeting, but will not be counted as votes cast
"for" or "against" any given matter. Broker non-votes will be treated as shares
present and entitled to vote at the Meeting for purposes of determining whether
a quorum is present. However, broker non-votes will not be considered as votes
cast at the Meeting.
The close of business on January 11, 1996 has been fixed as the record
date for the determination of shareholders entitled to notice of, and to vote
at, the Meeting and at any adjournment or postponement thereof. On that date,
the Company had 1,125,283 shares of Common Stock, outstanding held by 608
holders of record. Each share will be entitled to one vote at the Meeting. The
Notice of Meeting, Proxy Statement and form of Proxy are first being mailed to
shareholders on or about February 6, 1996.
The date of this Proxy Statement is February 6, 1996.
I. APPROVAL OF SPECIAL DISTRIBUTION
A majority of outstanding shares of the Common Stock represented in
person or by proxy shall constitute a quorum at the Meeting. Pursuant to Article
VII of the Company's Articles of Incorporation, if a quorum is present, an
affirmative vote of (i) the holders of at least seventy-five percent (75%) of
the issued and outstanding shares of Common Stock and (ii) at least sixty-six
and two-thirds percent (66-2/3%) of the issued and outstanding shares of the
Common Stock Beneficially Owned (as defined on Schedule A hereto) by
shareholders other than any Interested Shareholder (as defined on Schedule A
hereto), present either in person or by proxy at the Meeting, is required for
the approval of a special cash distribution (the "Special Distribution") of
$2.25 per share of Common Stock of the Company, payable, out of the Company's
capital surplus, on each share of Common Stock outstanding of record at the
close of business on January 11, 1996. If the Company's shareholders vote to
approve the Special Distribution, the Company shall distribute on March 11,
<PAGE>
1996, or as soon thereafter as practicable, $2.25 per share of Common Stock on
each share of Common Stock outstanding of record at the close of business on
January 11, 1996. The Company has been informed that the National Association
of Securities Dealers, Inc. (the "NASD") will not designate an "ex-dividend
date" for the Company's Common Stock until after the Company's shareholders
approve the Special Distribution. The "ex-dividend date", if designated, is the
date on and after which the Company's Common Stock will be traded without the
Special Distribution. According to the rules of the NASD, prior to the NASD's
designation of an "ex-dividend date", if any, the Company's Common Stock will be
traded with the rights to the proposed Special Distribution; therefore, any
shareholder of the Company of record on January 11, 1996 or thereafter who
transfers Common Stock of the Company prior to the "ex-dividend date" is
obligated to transfer the Special Distribution to the purchaser of such shares
of Common Stock. Shares represented by a properly signed, dated and returned
proxy are considered as shares present at the Meeting for purposes of
determining a quorum.
At a meeting of the Company's Board of Directors held on January 11,
1996, the Company's Treasurer reported to the Board that the Company, based upon
a current valuation of the Company's assets, had a sufficient capital surplus
account to permit a distribution of $2.25 per share of Common Stock on each
share of Common Stock outstanding of record on January 11, 1996. At the
meeting, the Board authorized and declared the Special Distribution, subject to
the approval of the Company's shareholders, in order to maximize shareholder
value by providing shareholders with a special cash distribution out of capital
surplus while maintaining a level of assets deemed sufficient for the Company to
seek potential merger opportunities.
The Board of Directors is required to submit the proposed Special
Distribution to a vote of the Company's shareholders pursuant to Article VII of
the Company's Articles of Incorporation. If the shareholders approve the
Special Distribution, $2,531,886.75 (approximately 75% of the Company's net
worth as of December 31, 1995), will be distributed on each share of Common
Stock outstanding of record at the close of business on January 11, 1996. If
the shareholders do not approve the Special Distribution, the Board of Directors
will rescind the resolution authorizing and declaring the Special Distribution
and the Special Distribution will not be distributed.
FEDERAL INCOME TAX CONSIDERATIONS
The following is a general summary of certain federal income tax
consequences of the proposed Special Distribution to shareholders that are
individuals. Special rules apply to shareholders that are corporations.
Corporate shareholders should consult with their own tax advisors regarding
these special rules. Further, the consequences to any particular shareholder
will depend on that shareholder's particular circumstances, including whether
the shareholder later disposes of the shares. ACCORDINGLY, EACH SHAREHOLDER
SHOULD CONSULT WITH ITS OWN TAX ADVISORS REGARDING THE DIRECT AND INDIRECT,
FEDERAL, STATE, LOCAL AND OTHER TAX CONSEQUENCES TO SUCH SHAREHOLDER OF THE
SPECIAL DISTRIBUTION.
The character of the Special Distribution for federal income tax
purposes as a dividend, a tax-free return of capital that reduces basis or gain
from the sale of the shares is impossible to predict. For federal income tax
purposes, the Special Distribution will be a dividend to the extent of the
Company's current and accumulated earnings and profits. To the extent it
exceeds the Company's current and accumulated earnings and profits, a
distribution to a shareholder will be treated as a return
2
<PAGE>
of capital to the extent of that shareholder's basis (generally tax-free) and
thereafter as gain from the sale of the shares.
The Company has incurred losses in prior years and therefore has a
deficit in accumulated earnings and profits. Current year earnings and profits
are not determinable until the end of Company's taxable year. It is impossible
to predict whether the Company will be considered to have made the Special
Distribution out of current earnings and profits or accumulated earnings and
profits because, among other reasons, these determinations take account of
events occurring after the distribution. Further, where there is more than one
distribution during a year and the total amount distributed exceeds the year's
current earnings, the earnings are pro rated to the distributions. Thus, in the
case of the Company, whether the Special Distribution is out of current earnings
will depend in part on whether the Company has additional earnings during 1996
and whether the Company makes further distributions. In this regard, the
character of the Special Distribution may also be affected by a merger,
acquisition or other business combination involving the Company or a sale or
transfer of any of the Company's assets.
The Company will generally be required to determine whether and to what
extent the Special Distribution is a dividend and to report such information to
certain shareholders by January 31, 1997 and to the Internal Revenue Service by
February 28, 1997. For purposes of "backup withholding" the entire Special
Distribution will be considered a dividend. Backup withholding generally does
not apply to shareholders that properly file a Form W-9 (which lists the
shareholder's name and social security number) with the paying agent.
Shareholders should be aware that various proposals have been made in
Congress and by the President to amend the Internal Revenue Code. It is
impossible to predict whether any such proposal will be enacted or, if enacted,
its effect on any particular shareholder.
EACH SHAREHOLDER SHOULD CONSULT WITH ITS OWN TAX ADVISORS REGARDING THE
CHARACTERIZATION OF THE SPECIAL DISTRIBUTION AND THE FEDERAL, STATE LOCAL AND
OTHER TAX CONSEQUENCES TO SUCH SHAREHOLDER OF THE SPECIAL DISTRIBUTION.
3
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number of shares and percentage of Common
Stock beneficially owned as of January 15, 1996 by (i) owners of more than five
percent of the Common Stock, (ii) each director and executive officer of the
Company, and (iii) all officers and directors of the Company as a group.
<TABLE>
<CAPTION>
Name and Address of
Beneficial Owners(1) Number of Shares Percentages Owned
- -------------------- ---------------- -----------------
<S> <C> <C>
William B. Tanner(2) 165,600 14.7
2076 Union Avenue
P.O. Box 40769
Memphis, Tennessee 38174
Dan Purjes(3) 171,832 15.3
c/o Josephthal Lyon & Ross
Incorporated
200 Park Avenue, 24th Floor
New York, New York 10166
Franklyn B. Weichselbaum 0 *
6516 Via Rosa
Boca Raton, Florida 33433
Alan L. Jacobs 7,562 *
c/o Boca Raton Capital
Corporation
6516 Via Rosa
Boca Raton, Florida 33433
Ronald L. Miller 0 *
c/o Miller Advisory Corp.
2601 Heron Lane N.
Clearwater, Florida 34622
Alan H. Weingarten 7,500 *
c/o Alan H. Weingarten &
Associates, Inc.
21759 Club Villa Terrace
Boca Raton, Florida 33433
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Name and Address of
Beneficial Owners(1) Number of Shares Percentages Owned
- -------------------- ---------------- -----------------
<S> <C> <C>
Robert H. Arnold 0 *
c/o R.H. Arnold & Co.
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
C. Lawrence Rutstein 0 *
340 Overlook Lane
Gulph Mills, Pennsylvania 19428
All officers and directors as 15,062 1.3
a group (6 persons)
</TABLE>
- ------------------------------
* Less than 1 %.
(1) Unless otherwise indicated, each person listed above has sole voting power
and sole investment power with respect to the shares owned by such person.
(2) Includes (a) 23,000 shares held by WBT Holding Co., Inc., an entity
controlled by Mr. Tanner; (b) 11,500 shares held by Mr. Tanner as custodian for
Weatherly Blake, Mr. Tanner's son; (c) 4,600 shares held by Mr. Tanner as
custodian for William Taylor Tanner, Mr. Tanner's grandson; (d) 11,500 shares
held by Crystal Tanner, Mr. Tanner's daughter; and (e) 11,500 shares held by
William B. Tanner, Jr., Mr. Tanner's son. Mr. Tanner disclaims beneficial
ownership of all of these shares.
(3) Includes (a) 2,500 shares owned by his minor children; (b) 48,166 shares
owned by his spouse; (c) 3,000 shares held in his profit sharing plan account;
(d) 1,000 shares held in his IRA; (e) 35,000 shares owned by Josephthal
Holdings, of which Mr. Purjes is an executive officer, director and principal
shareholder; and (f) 11,500 shares owned by the Josephthal Profit Sharing Plan,
of which Mr. Purjes has the authority to appoint and discharge its trustees. Mr.
Purjes disclaims beneficial ownership of the shares held by his spouse,
Josephthal Holdings and the Josephthal Profit Sharing Plan.
II. OTHER MATTERS
The Board of Directors of the Company does not know of any other matters
which may be brought before the Meeting. However, if any such other matters are
properly presented for action, it is the intention of the persons named in the
accompanying form of Proxy to vote the shares represented thereby in accordance
with their judgment on such matters.
5
<PAGE>
III. DEADLINE FOR RECEIPT OF SHAREHOLDER PROPOSALS FOR 1995 ANNUAL MEETING
Under the Commission's proxy rules, shareholder proposals that meet
certain conditions may be included in the Company's proxy statement and proxy
for a particular annual meeting. Proposals of shareholders that are intended to
be presented by such shareholders at the Company's 1995 Annual Meeting must be
received by the Company no later than August 1, 1996 to be considered for
inclusion in the proxy statement and form of proxy relating to that meeting.
Receipt by the Company of any such proposal from a qualified shareholder in a
timely manner will not ensure its inclusion in the Company's proxy material
because there are other requirements in the proxy rules for such inclusion.
IV. MISCELLANEOUS
If the accompanying form of Proxy is executed properly and returned, the
shares represented thereby will be voted at the Meeting in accordance with the
instructions on the Proxy, unless the Proxy is revoked. If no instructions are
indicated in such Proxy, the shares represented thereby will be voted FOR the
approval of the Special Distribution of $2.25 per share of Common Stock payable,
out of the Company's capital surplus, on each share of Common Stock outstanding
of record at the close of business on January 11, 1996, and in the discretion of
the Proxy holders as to any other matter which may properly come before the
Meeting. Any Shareholder who has given a Proxy may revoke such Proxy at any time
prior to its exercise at the Meeting by (i) giving written notice of the
revocation to Franklyn B. Weichselbaum, as Secretary of the Company, (ii)
properly submitting to Franklyn B. Weichselbaum, as Secretary of the Company, a
duly executed Proxy bearing a later date, or (iii) attending the Meeting and
voting in person. Attendance at the Meeting will not in and of itself revoke a
Proxy. All written notices of revocation and other communications with respect
to revocation of Proxies should be addressed as follows: Franklyn B.
Weichselbaum, Secretary, Boca Raton Capital Corporation, 6516 Via Rosa, Boca
Raton, Florida 33433.
All costs relating to the solicitation of Proxies will be borne by the
Company. Proxies may be solicited by the officers of the Company personally, by
mail or by telephone or telegraph, and the Company may pay brokers and other
persons holding shares of stock in their names or those of their nominees for
their reasonable expenses in sending soliciting material to their principals.
BY ORDER OF THE BOARD OF DIRECTORS
Franklyn B. Weichselbaum
Secretary
Boca Raton, Florida
February 6, 1996
6
<PAGE>
SCHEDULE A
"Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Securities Exchange Act of 1934, or, if said Rule 12b-2 shall be rescinded
and there shall be no successor rule or statutory provision thereto, pursuant to
said Rule 12b-2 as in effect on the filing date of these Amended and Restated
Articles of Incorporation.
"Beneficial Ownership" shall be determined pursuant to Rule 13d-
3 of the General Rules and Regulations under the Securities Exchange Act of 1934
(or any successor rule or statutory provision), or, if said Rule 13d-3 shall be
rescinded and there shall be no successor rule or statutory provision thereto,
pursuant to said Rule 13d-3 as in effect on the filing date of these Amended and
Restated Articles of Incorporation; provided, however, that a Person shall, in
any event, also be deemed the "Beneficial Owner" of any Voting Stock:
(1) which such Person or any of its Affiliates or Associates
Beneficially Owns, directly or indirectly; or
(2) which such Person or any of its Affiliates or Associates
has (i) the right to acquire (whether such right is exercisable
immediately or only after the passage of time), pursuant to any
agreement, arrangement or understanding (but shall not be deemed to be
the Beneficial Owner of any shares solely by reason of an agreement,
contract, or other arrangement with this Corporation to effect any
transaction which is described in any one or more of clauses of Section
1 of Article VII) or upon the exercise of conversation rights, exchange
rights, warrants, or options or otherwise, or (ii) sole or shared voting
or investment power with respect thereto pursuant to any agreement,
arrangement, understanding, relationship or otherwise (but shall not be
deemed to be the Beneficial Owner of any shares solely by reason of a
recoverable proxy granted for a particular meeting of stockholders,
pursuant to a public solicitation of proxies for such meeting, with
respect to shares of which neither such person nor any such Affiliate or
Associate is otherwise deemed the Beneficial Owner); or
(3) which are Beneficially Owned, directly or indirectly, by
any other Person with which such first-mentioned Person or any of its
Affiliates or Associates acts as a partnership, limited partnership,
syndicate or other group pursuant to any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or disposing
of any shares of capital stock of this Corporation.
Notwithstanding any of the foregoing to the contrary, (i) no
director or officer of this Corporation (or any Affiliate or Associate of any
such director or officer) shall, solely by reason of any or all of such
directors or officers acting in their capacities as such, be deemed, for any
purposes hereof, to Beneficially Own any Voting Stock Beneficially Owned by any
other such director or officer (or any Affiliate or Associate thereof), and (ii)
neither any employee stock ownership or similar plan of this Corporation or any
subsidiary of this Corporation nor any trustee with respect thereto (or any
Affiliate of such trustee) shall, solely by reason of such capacity of such
trustee, be deemed, for any purposes hereof, to Beneficially Own any Voting
Stock held under any such plan. For purposes of computing the percentage of
Beneficial Ownership of Voting Stock of a Person, the outstanding Voting
<PAGE>
Stock shall include shares deemed owned by such Person through application of
this subsection, but shall not include any other Voting Stock which may be
issuable by this Corporation pursuant to any agreement, or upon exercise of
conversion rights, warrants or options, or otherwise. For all other purposes,
the outstanding Voting Stock shall include only Voting Stock then outstanding
and shall not include any Voting Stock which may be issuable by this Corporation
pursuant to any agreement, or upon the exercise of conversion rights, warrants
or options or otherwise.
"Interested Shareholder" shall mean any person (other than the
Corporation, any Subsidiary thereof or Gary O. Marino, none of whom shall be an
Interested Shareholder for purposes of these Amended and Restated Articles of
Incorporation) who or which:
(1) is the Beneficial Owner, directly or indirectly, of more
than 10% of the voting power of the outstanding Voting Stock; or
(2) is an Affiliate of the Corporation and at any time
within the two-year period immediately prior to the date in question was
the Beneficial Owner, directly or indirectly, of 10% or more of the
voting power of the then outstanding Voting Stock; or
(3) is an assignee of or has otherwise succeeded to any
shares of Voting Stock which were at any time within the two-year period
immediately prior to the date in question Beneficially Owned by any
Interested Shareholder, if such assignment or succession shall have
occurred in the course of a transaction or series of transactions not
involving a public offering within the meaning of the Securities Act of
1933.
"Person" shall include an individual, a group acting in concert,
a corporation, a partnership, an association, a joint venture, a pool, a joint
stock company, a trust, an unincorporated organization or similar company, a
syndicate or any other group formed for the purpose of acquiring, holding or
disposing of securities.
"Subsidiary" means any corporation of which a majority of any
class of equity security is owned, directly or indirectly, by the Corporation.
"Voting Stock" means any issued and outstanding shares of
capital stock of the Corporation entitled to vote generally in the election of
directors; provided, however, that for the purpose of determining whether a
person is an Interested Shareholder pursuant to Paragraph G of this Section 3,
the number of shares of Voting Stock deemed to be outstanding shall include
shares deemed owned through application of Paragraph B of this Section 3 but
shall not include any other shares of Voting Stock which may be issuable
pursuant to any agreement, arrangement or understanding, or upon exercise of
conversion rights, warrants or options, or otherwise.
2
<PAGE>
BOCA RATON CAPITAL CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF BOCA RATON CAPITAL CORPORATION (the "Company").
The undersigned hereby appoints Alan L. Jacobs and Franklyn B.
Weichselbaum as Proxies, each with the power to appoint his substitute; and
hereby authorizes them, or any of them, to represent and vote as designated on
the reverse side of this proxy card, all the shares of common stock of the
Company held of record by the undersigned on January 11, 1996 at the Special
Meeting of Shareholders to be held on February 29, 1996, or any adjournment or
postponement thereof.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
/X/
Please mark your votes as in this example.
TO VOTE WITH THIS PROXY BALLOT, FILL IN THE BOX TO THE RIGHT OF YOUR VOTE FOR
EACH PROPOSAL THEN SIGN, DATE AND RETURN THIS BALLOT IN THE ENVELOPE PROVIDED.
The undersigned hereby instructs the
proxies named hereon or their
substitutes to vote, in their
discretion, upon such other matters
which may properly come before the
meeting or any adjournment thereof.
1. Approval of special FOR AGAINST ABSTAIN
distribution of $2.25 / / / / / /
per share of common
stock of the Company,
out of the Company's
capital surplus, on
each share of common
stock outstanding of
record on January 11,
1996.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF YOU EXECUTE AND RETURN THIS PROXY BUT DO NOT
SPECIFY OTHERWISE, THIS PROXY WILL BE VOTED FOR THE APPROVAL OF THE SPECIAL
DISTRIBUTION OF $2.25 PER SHARE ON EACH SHARE OF COMMON STOCK OUTSTANDING OF
RECORD ON JANUARY 11, 1996.
SIGNATURE
------------------------------- -------------------------------------
DATED SIGNATURE IF JOINTLY OWNED DATED
Note: Please sign exactly as the name appears above. When shares are held by
Joint Tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give the full title as such.
If a corporation, please sign the full corporate name by the President
or other authorized officer. If a partnership, please sign in the
partnership name by an authorized person.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 2,900,888
<SECURITIES> 1,089,375
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,990,263
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,990,263
<CURRENT-LIABILITIES> 126,220
<BONDS> 588,029
0
0
<COMMON> 1,125
<OTHER-SE> 3,274,889
<TOTAL-LIABILITY-AND-EQUITY> 3,990,263
<SALES> 0
<TOTAL-REVENUES> 868,024
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 313,576
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 352,448
<INCOME-TAX> 95,894
<INCOME-CONTINUING> 256,554
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 256,554
<EPS-PRIMARY> .23
<EPS-DILUTED> .23
</TABLE>
<PAGE>
EXHIBIT 99.3
Securities and Exchange Commission
Washington, D.C. 20549
NOTIFICATION OF WITHDRAWAL OF ELECTION TO BE
SUBJECT TO SECTIONS 55 THROUGH 65 OF THE INVESTMENT
COMPANY ACT OF 1940 FILED PURSUANT TO SECTION 54(C) OF THE
INVESTMENT COMPANY ACT OF 1940
The undersigned business development company hereby notifies the Securities and
Exchange Commission that it withdraws its election to be subject to sections 55
through 65 of the Investment Company Act of 1940 (the "Act"), pursuant to the
provisions of section 54(c) of the Act, and in connection with such notice of
withdrawal of election submits the following information:
Name: BOCA RATON CAPITAL CORPORATION (THE "COMPANY")
----------------------------------------------
Address of Principal Business Office (No. & Street, City, State, Zip Code):
6516 VIA ROSA, BOCA RATON, FLORIDA 33433
- ----------------------------------------
Telephone Number (including area code): (407) 750-2252
--------------
File Number under the Securities Exchange Act of 1934: 0-16631
-------
Boca Raton Capital Corporation (the "Company") is filing this Notification of
Withdrawal under Section 54(c) of the Act based on the explanation set forth
below in accordance with paragraph "D" of form N-54(c). The Company has changed
the nature of its business so as to cease to be a business development company,
and such change was authorized by a vote of majority of its outstanding voting
securities at a shareholders' meeting held on December 15, 1995. 500,695 number
of votes were cast in favor of authorizing the election of withdrawal pursuant
to this form. 698 number of votes were cast against the proposal to authorize
the filing of this form.
The Company currently has less than 40% of its assets in investment securities,
which consist solely of the common stock of RailAmerica, Inc. and the remainder
of its assets are in cash and cash items. The Board of Directors of the Company
has determined that it is in the best interests of the Company's shareholders to
withdraw the Company's election to be treated as a business development company
and will seek to either merge with another operating company or take steps to
liquidate the assets of the Company. The Board has also adopted a resolution in
accordance with Rule 3a-2 under the Act so that the Company will not be deemed
an investment company subject to registration under the Act. These
<PAGE>
actions are more fully described in the proxy statement dated November 20, 1995
distributed to all shareholders in advance of the Special Meeting of
Shareholders on December 15, 1995.
Pursuant to the requirements of the Act, the undersigned company has caused
this notification of withdrawal of election, subject to sections 55 through 65
of the Act, to be duly signed on its behalf in the city of Boca Raton, state of
Florida on the 20th day of December, 1995.
By: BOCA RATON CAPITAL CORPORATION
[SEAL] Signature: /s/ Alan L. Jacobs
-------------------------
Alan L. Jacobs
President and Chief
Executive Officer
Attest: /s/ Franklyn B. Weichselbaum
---------------------------------
Franklyn B. Weichselbaum
---------------------------------
Secretary
2
