<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
RAILAMERICA, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 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 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
RAILAMERICA, INC.
301 YAMATO ROAD, SUITE 1190
BOCA RATON, FLORIDA 33431
----------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 24, 1996
----------------------------------------
To the Stockholders of RAILAMERICA, INC.:
NOTICE IS HEREBY GIVEN that the 1996 Annual Meeting of Stockholders
(the "1996 Annual Meeting") of RailAmerica, Inc., a Delaware corporation (the
"Company"), will be held at 10:00 a.m., local time, on Wednesday, July 24,
1996, at the Boca Raton Marriott at Town Center, 5150 Town Center Circle, Boca
Raton, Florida, for the following purposes:
1. To elect two Class I Directors to hold office for terms of
three years or until their successors are duly elected and qualified;
2. To elect one Class II Director to hold office for a term of
one year or until his successor is duly elected and qualified;
3. To elect one Class III Director to hold office for a term of
two years and until his successor is duly elected and qualified; and
4. To transact such other business as may properly come before
the 1996 Annual Meeting and any and all postponements or adjournments thereof.
All stockholders are cordially invited to attend; however, only
stockholders of record at the close of business on June 14, 1996, shall be
entitled to notice of and to vote at the 1996 Annual Meeting or any
postponements or adjournments thereof.
By order of the Board of Directors
GARY O. MARINO
Chairman of the Board and
Chief Executive Officer
Boca Raton, Florida
June 27, 1996
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE ANNUAL MEETING, PLEASE COMPLETE,
SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
RETURN ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
STOCKHOLDERS WHO EXECUTE A PROXY CARD MAY NEVERTHELESS ATTEND THE MEETING,
REVOKE THEIR PROXY AND VOTE THEIR SHARES IN PERSON.
<PAGE> 3
1996 ANNUAL MEETING OF STOCKHOLDERS
OF
RAILAMERICA, INC.
--------------------
PROXY STATEMENT
--------------------
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of RailAmerica, Inc., a Delaware corporation (the
"Company"), of proxies from the holders of the Company's Common Stock, par
value $.001 per share (the "Common Stock"), for use at the 1996 Annual Meeting
of Stockholders of the Company to be held at 10:00 a.m., local time, on
Wednesday, July 24, 1996 at the Boca Raton Marriott at Town Center, 5150 Town
Center Circle, Boca Raton, Florida, or at any and all postponement(s) or
adjournment(s) thereof (the "1996 Annual Meeting"), pursuant to the foregoing
Notice of Annual Meeting of Stockholders.
The approximate date that this Proxy Statement and the enclosed form
of proxy are first being sent to stockholders is June 27, 1996. Stockholders
should review the information provided herein in conjunction with the Company's
1995 Annual Report to Stockholders, which accompanies this Proxy Statement.
The Company's principal executive office is located at 301 Yamato Road, Suite
1190, Boca Raton, Florida 33431, and its telephone number is (407) 994-6015.
INFORMATION CONCERNING PROXY
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. The giving of a proxy does not preclude the right to vote in person
should any stockholder giving the proxy so desire. Stockholders have an
unconditional right to revoke their proxy at any time prior to the exercise
thereof, either in person at the 1996 Annual Meeting or by filing with the
Company's Secretary at the Company's headquarters a written revocation or duly
executed proxy bearing a later date; however, no such revocation will be
effective until written notice of the revocation is received by the Company at
or prior to the 1996 Annual Meeting.
The cost of soliciting proxies in the form enclosed herewith will be
borne by the Company. In addition to the solicitation of proxies by mail, the
Company, through its directors, officers, employees and agents, may also
solicit proxies personally and by telephone. Only independent third party
agents not otherwise affiliated with the Company will be specifically
compensated for such solicitation activities. The Company will also request
persons, firms and corporations holding shares in their names or in the names
of their nominees, which are beneficially owned by others, to send proxy
material to and obtain proxies from such beneficial owners and will reimburse
such holders for their reasonable expenses in doing so. American Stock
Transfer and Trust Company acts as the Company's transfer agent and, as part of
its services to the Company, may solicit the return of voted proxies from
banks, brokers, nominees and intermediaries. For such services, American Stock
Transfer and Trust Company does not receive any set compensation other than
compensation it receives for acting as a transfer agent.
PURPOSES OF THE MEETING
At the 1996 Annual Meeting, the Company's stockholders will consider
and vote upon the following matters:
1. The election of two Class I Directors to hold office for terms
of three years or until their successors are duly elected and qualified;
2. The election of one Class II Director to hold office for a
term of one year or until his successor is duly elected and qualified;
<PAGE> 4
3. The election of one Class III Director to hold office for a
term of two years or until his successor is duly elected and qualified; and
4. Such other business as may properly come before the 1996
Annual Meeting, including any adjournments or postponements thereof.
Unless contrary instructions are indicated on the enclosed proxy, all
shares represented by valid proxies received pursuant to this solicitation (and
which have not been revoked in accordance with the procedures set forth above)
will be voted (a) FOR the election of the two Class I nominees for director
named below, (b) FOR the election of the one Class II nominee for director
named below, and (c) FOR the election of the one Class III nominee for director
named below. In the event a stockholder specifies a different choice by means
of the enclosed proxy, his or her shares will be voted in accordance with the
specification so made.
The Board of Directors does not know of any other matters that may be
brought before the 1996 Annual Meeting nor does it foresee or have reason to
believe that proxy holders will have to vote for substitute or alternate
nominees. In the event that any other matter should come before the 1996
Annual Meeting or any nominee is not available for election, the persons named
in the enclosed proxy will have discretionary authority to vote all proxies not
marked to the contrary with respect to such matters in accordance with their
best judgment.
OUTSTANDING VOTING SECURITIES AND VOTING RIGHTS; COMMON STOCK
The Board of Directors has set the close of business on June 14, 1996,
as the record date (the "Record Date") for determining stockholders of the
Company entitled to notice of, and to vote at, the 1996 Annual Meeting. As of
the Record Date, there were 4,672,910 shares of Common Stock issued and
outstanding, all of which are entitled to be voted at the 1996 Annual Meeting.
Each share of Common Stock is entitled to one vote on each matter submitted to
stockholders for approval at the 1996 Annual Meeting. Stockholders do not have
the right to cumulate their votes for directors.
The attendance, in person or by proxy, of the holders of a majority of
the outstanding shares of Common Stock entitled to vote at the 1996 Annual
Meeting is necessary to constitute a quorum. Directors will be elected by a
plurality of the votes cast by the shares of Common Stock represented in person
or by proxy at the 1996 Annual Meeting. Any other matter that may be submitted
to a vote of the stockholders will be approved if the number of shares of
Common Stock voted in favor of the matter exceeds the number of shares voted in
opposition to the matter, unless such matter is one for which a greater vote is
required by law or by the Company's Certificate of Incorporation or Bylaws. If
less than a majority of outstanding shares entitled to vote are represented at
the 1996 Annual Meeting, a majority of the shares so represented may adjourn
the 1996 Annual Meeting to another date, time or place, and notice need not be
given of the new date, time or place if the new date, time or place is
announced at the meeting before an adjournment is taken.
Prior to the 1996 Annual Meeting, the Company will select one or more
inspectors of election for the meeting. Such inspector(s) shall determine the
number of shares of Common Stock represented at the meeting, the existence of a
quorum and the validity and effect of proxies, and shall receive, count and
tabulate ballots and votes and determine the results thereof.
Pursuant to Delaware law, abstentions and broker non-votes are counted
as present for purposes of determining the presence of a quorum. However,
abstentions are treated as present and entitled to vote and thus have the
effect of a vote against a matter. A broker non-vote on a matter is considered
not entitled to vote on that matter and thus is not counted in determining
whether a matter requiring approval of a majority of the shares present and
entitled to vote has been approved or whether a plurality of the shares present
and entitled to vote has been voted.
A list of stockholders entitled to vote at the 1996 Annual Meeting
will be available at the Company's offices, 301 Yamato Road, Suite 1190, Boca
Raton, Florida, for a period of ten days prior to the 1996 Annual Meeting and
at the 1996 Annual Meeting itself for examination by any stockholder.
2
<PAGE> 5
The Company's Common Stock is quoted on the National Association of
Security Dealers Automated Quotation ("NASDAQ") system under the symbol "RAIL".
Set forth below is high and low bid information for the Common Stock as
reported on NASDAQ for each of the quarters of 1994 and 1995. All such
quotations reflect inter-dealer prices, without retail markup, mark-down or
commissions and may not reflect actual transactions.
<TABLE>
<CAPTION>
1994 High Low
------------------ --------- ---------
<S> <C> <C>
First Quarter $ 2 3/8 $ 1 3/4
Second Quarter 2 1/4 1 5/8
Third Quarter 4 3/4 1 3/8
Fourth Quarter 3 7/8 1 7/8
<CAPTION>
1995
------------------
<S> <C> <C>
First Quarter $ 4 3/8 $2 15/16
Second Quarter 5 1/4 3 13/16
Third Quarter 5 1/16 3 1/2
Fourth Quarter 4 5/32 3 3/8
</TABLE>
The Company has never declared or paid a dividend on its Common Stock.
The Company is prohibited from paying dividends on the Common Stock pursuant to
certain restrictive covenants contained in its loan agreements.
3
<PAGE> 6
SECURITY OWNERSHIP
The following table sets forth, as of the Record Date, based on
information obtained from the persons and entities named below, the number of
shares of Common Stock which were beneficially owned by (i) each person known
by the Company to be the owner of more than 5% of the Common Stock, (ii) each
director of the Company, (iii) the Named Executive Officers (as defined below)
and (iv) all directors and executive officers of the Company as a group:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE PERCENTAGE OF
OFFICER OR DIRECTOR OF BENEFICIAL OUTSTANDING
OWNERSHIP(1) SHARES(2)
- ---------------------------------------------------- ----------------- -------------
<S> <C> <C>
John H. Marino . . . . . . . . . . . . . . . . . . 422,500(3) 8.95%
RailAmerica,Inc.
King Street Station
Suite 150, 1800 Diagonal Road
Alexandria, Virginia 22314
Gary O. Marino . . . . . . . . . . . . . . . . . . 367,000(4) 7.36%
301 Yamato Road, St. 2222
Boca Raton, Florida 33431
Donald D. Redfearn . . . . . . . . . . . . . . . . 72,133(5) 1.51%
Jenex Financial Services
2240 Woolbright Road, Suite 351
Boynton Beach, Florida 33426
John M. Sullivan . . . . . . . . . . . . . . . . . 55,100(6) 1.17%
10279 SW Stones Throw Terrace
Palm City, FL 34990
Richard Rampell . . . . . . . . . . . . . . . . . . 51,000(7) 1.08%
122 North County Road
Palm Beach, Florida 33480
Charles Swinburn . . . . . . . . . . . . . . . . . 51,000(8) 1.08%
1800 M. Street NW
Washington, D.C. 20036
All Executive Officers and Directors
as a Group (6 persons) . . . . . . . . . . . . . . 1,018,733(9) 19.46%
</TABLE>
- -----------------------
(1) A person is deemed to be the beneficial owner of securities that can
be acquired by such person within 60 days upon the exercise of options
or warrants. Each beneficial owner's percentage ownership is
determined by assuming that options or warrants that are held by such
person (but not those held by any other person) and that are
exercisable within 60 days have been exercised. Unless otherwise
noted, the Company believes that all persons named in the table have
sole voting and investment power with respect to all shares of Common
Stock beneficially owned by them.
(2) Does not include the issuance of 849,208 shares of Common Stock upon
the exercise of the Company's outstanding, publicly-traded, Class B
Warrants.
(3) Includes 50,000 shares of Common Stock issuable upon the exercise of
presently exercisable options to purchase Common Stock at $3.625 per
share granted under the Company's 1995 Stock Incentive Plan. Mr. John
H. Marino is the brother of Mr. Gary O. Marino.
(4) Includes (i) 40,000 shares of Common Stock issuable upon the exercise
of presently exercisable options to purchase Common Stock at $3.50 per
share granted under the Company's 1992 Stock Option Plan and (ii)
10,000 shares of Common Stock issuable upon the exercise of presently
exercisable options to purchase
4
<PAGE> 7
Common Stock at $3.625 per share granted under the Company's 1995
Stock Incentive Plan. Also includes (i) 87,500 shares of Common Stock
issuable upon the exercise of presently exercisable options to
purchase Common Stock at $3.10 per share, (ii) 87,500 shares of Common
Stock issuable upon the exercise of presently exercisable options to
purchase Common Stock at $3.40 per share and (iii) 87,500 shares of
Common Stock issuable upon the exercise of presently exercisable
options to purchase Common Stock at $3.75 per share, all of which
options were granted pursuant to the terms of Mr. Marino's employment
agreement. Does not include 87,500 shares of Common Stock issuable
upon the exercise of options to purchase Common Stock at $4.15 per
share, which options are not presently exercisable. See "Executive
Compensation." Mr. Gary O. Marino is the brother of Mr. John H.
Marino.
(5) Includes (i) 40,000 shares of Common Stock issuable upon the exercise
of presently exercisable options to purchase Common Stock at $3.50 per
share granted under the Company's 1992 Stock Option Plan and (ii)
10,000 shares of Common Stock issuable upon the exercise of presently
exercisable options to purchase Common Stock at $3.50 per share
granted under the Company's 1995 Non-Employee Director Stock Option
Plan.
(6) Includes 50,000 shares of Common Stock issuable upon the exercise of
presently exercisable options to purchase Common Stock at $3.50 per
share granted under the Company's 1992 Stock Option Plan.
(7) Includes 50,000 shares of Common Stock issuable upon the exercise of
presently exercisable options to purchase Common Stock at $4.81 per
share granted under the Company's 1995 Non-Employee Director Stock
Option Plan.
(8) Includes 50,000 shares of Common Stock issuable upon the exercise of
presently exercisable options to purchase Common Stock at $4.19 per
share granted under the Company's 1995 Non-Employee Director Stock
Option Plan.
(9) See items (3) - (8) above.
ELECTION OF DIRECTORS; NOMINEES
Pursuant to the Company's Amended and Restated Certificate of
Incorporation, the Board of Directors of the Company (sometimes referred to
herein as the "Board") is divided into three classes, as nearly equal in number
as possible, designated Class I, Class II and Class III. The current term of
the Class I Directors terminates on the date of the Company's 1996 Annual
Meeting; the current term of the Class II Directors terminates on the date of
the Company's 1997 annual meeting of stockholders and the current term of the
Class III Directors terminates an the date of the Company's 1998 annual meeting
of stockholders. At each annual meeting of stockholders, successors to the
class of directors whose term expires at that annual meeting are elected for a
three-year term. Donald D. Redfearn and Charles Swinburn currently serve as
Class I directors and will stand re-election at the 1996 Annual Meeting. In
1996, in accordance with the Company's Amended and Restated Certificate of
Incorporation, the Company's Board of Directors determined to expand the Board
of Directors by adding two directors, one Class II director and one Class III
director. Robert F. Toia has been nominated by the Board of Directors for
election as a new Class II director and Douglas R. Nichols has been nominated
by the Board of Directors for election as a new Class III director. Messrs.
John H. Marino and John Sullivan currently serve as Class II directors, and
Messrs. Gary O. Marino and Richard Rampell currently serve as Class III
directors. If elected at the 1996 Annual Meeting, (i) Messrs. Redfearn and
Swinburn will serve until the 1999 annual meeting of stockholders and until
their successors are elected and qualified, (ii) Mr. Toia will serve until the
1997 annual meeting of stockholders and until his successor is elected and
qualified and (iii) Mr. Nichols will serve until the 1998 annual meeting of
stockholders and until his successor is elected and qualified.
Pursuant to the terms of the Underwriting Agreement relating to the
Company's initial public offering of Common Stock consummated in November 1992,
the representatives of the several underwriters (the "Representatives") of such
offering have the right, until September 1997, to have a designee attend all
meetings of the Board of Directors of the Company and to cause the Company to
nominate and use its best efforts to obtain election to the Board of Directors
of a person designated by the Representatives. Mr. Sullivan was elected to the
Company's Board of Directors upon designation by the Representatives.
Messrs. Redfearn, Swinburn, Toia and Nichols have consented to serve
on the Company's Board of Directors and the Board of Directors has no reason to
believe that they will not serve if elected. However, if any of them should
become unavailable to serve as a director, and if the Board shall have
designated a substitute
5
<PAGE> 8
nominee or nominees, the persons named as proxies will vote for the substitute
nominee or nominees designated by the Board of Directors.
MANAGEMENT
The executive officers and directors of the Company are as follows:
<TABLE>
<CAPTION>
NAME AGE POSITION
----- --- --------
<S> <C> <C>
Gary O. Marino 51 Chairman of the Board, Chief Executive
Officer and Treasurer
John H. Marino 56 President, Chief Operating Officer,
Director
Donald D. Redfearn 43 Executive Vice President, Secretary and
Director
John M. Sullivan 71 Director
Richard Rampell 44 Director
Charles Swinburn 54 Director
</TABLE>
NOMINEES FOR CLASS I DIRECTORS
DONALD D. REDFEARN - Mr. Redfearn has been Executive Vice President,
Administration and Secretary of the Company since December 1994. Mr. Redfearn
has been an officer and director of the Company since its formation in April
1992 and of the Company's Huron & Eastern Railway Company, Inc. ("HESR")
subsidiary since 1986. Mr. Redfearn joined the Company on a full-time basis in
January 1996. Mr. Redfearn was President of Jenex Financial Services, Inc., a
financial consulting firm, from September 1993 until September 1995. From 1984
until September 1993, Mr. Redfearn served in various capacities at Boca Raton
Capital Corporation ("BRCC"), a publicly-traded venture capital firm and former
stockholder of the Company, including Senior Vice President, Assistant
Secretary and Treasurer. Mr. Redfearn was also a Vice President of HTG (as
defined below) until the HTG Merger (as defined below). He received his B.A.
in Business Administration from the University of Miami and graduated from the
School of Banking of the South at Louisiana State University.
CHARLES SWINBURN - Mr. Swinburn joined the Board of Directors of the
Company effective February 1, 1995. Mr. Swinburn is currently a practicing
attorney in the Washington, D.C. office of Morgan, Lewis & Bockius, where he
specializes in environmental law. From April 1990 through August 1993, Mr.
Swinburn served as a consultant to private industry and the government. Prior
to that time, Mr. Swinburn served as Vice President of Rollins Environmental
Services, Inc. Mr. Swinburn has served in various capacities at the U.S.
Department of Transportation, most recently as Deputy Assistant Secretary for
Policy and International Affairs. Mr. Swinburn received his B.A. from
Princeton University in 1969, his M.B.A. from Harvard Business School in 1971
and his J.D. from the University of Pennsylvania in 1993.
NOMINEE FOR CLASS II DIRECTOR
ROBERT F. TOIA - Mr. Toia, the former President of the Brandywine
Valley Railroad, the Upper Merion & Plymouth Railroad and the South Central
Florida Railroad, has been nominated to become a director of the Company. Mr.
Toia served as a transportation consultant to the Lukens Steel Company from
1957 until he joined the company as a Supervisor, Traffic and Transportation.
From 1967 to 1992, Mr. Toia served in various capacities with Lukens Steel
Company, including from 1982 to 1992 as the company's Corporate General
Manager, Rail Division where he was responsible for managing Lukens' in-plant
railroads. In all, Mr. Toia has over forty
6
<PAGE> 9
years experience in the transportation industry. Mr. Toia completed executive
management programs at the University of Michigan and Columbia University.
From 1951 to 1953, Mr. Toia served in the Judge Advocate Corps of the United
States Army. Mr. Toia serves on the Board of Directors of the American
Shortline Railroad Association and is a member of the National Industrial
Transportation League and the National Freight Transportation League, among
other organizations.
CONTINUING CLASS II DIRECTORS
JOHN H. MARINO - Mr. Marino has been President and a director of the
Company since its formation in April 1992 and Chief Operating Officer since
March 1, 1994, and he has been President and a director of HESR since 1986.
Mr. Marino was also the President of Huron Transportation Group, Inc. ("HTG"),
from its formation in January 1987 until HTG merged with RailAmerica Services
Corporation, the wholly-owned subsidiary of the Company ("RailAmerica Services
Corporation"), in December 1993 (the "HTG Merger"). Prior to founding HESR in
1985, Mr. Marino served as President and Chief Executive Officer of several
shortline railroads, as an officer of the Reading Railroad and with the United
States Railway Association, Washington, D.C. Mr. Marino received his B.S. in
civil engineering from Princeton University in 1961 and his M.S. in
transportation engineering from Purdue University in 1963. From 1963 to 1965,
Mr. Marino served as an officer of the United States Army Corps of Engineers.
JOHN M. SULLIVAN - Mr. Sullivan was elected a director in January
1993. From 1977 until 1981, Mr. Sullivan served, upon appointment by President
Carter, as head of the United States Federal Railroad Administration. From
1982 until 1990, Mr. Sullivan was President and Chief Executive Officer of Haug
Die Casting, Inc., where he remains a director. Mr. Sullivan received his B.S.
in engineering from the United States Naval Academy and served with the United
States Navy as an officer, and ultimately as a carrier aviator from 1946 to
1954.
NOMINEE FOR CLASS III DIRECTOR
DOUGLAS R. NICHOLS - Mr. Nichols, a certified public accountant and
the founder, President and principal stockholder of First London Securities
Corporation, a securities broker-dealer specializing in equity trading and
investment banking, has been nominated to become a director of the Company.
From 1989 to 1991, Mr. Nichols was a Vice President with the Dallas, Texas
office of Smith Barney and from 1986 to 1989 was a broker with the Dallas
branch of Shearson Lehman Brothers. Mr. Nichols is currently a member of the
National Railway Historical Society.
CONTINUING CLASS III DIRECTORS
GARY O. MARINO - Mr. Marino has been Chairman of the Company's Board
of Directors and Treasurer of the Company since its formation in April 1992 and
Chief Executive Officer since March 1, 1994, and he has been Chairman of the
Board and Treasurer of HESR since 1986. Mr. Marino joined the Company on a
full-time basis in March 1994. Mr. Marino was also the Chairman of HTG from
its formation in 1987 until the HTG Merger. From 1984 until October 1993, Mr.
Marino was the Chairman, President and Chief Executive Officer of BRCC, a
former stockholder of the Company. He received his B.A. from Colgate
University in 1966 and an M.B.A. from Fordham University in 1973. From 1966 to
1969, Mr. Marino served as an officer of the United States Army Ordnance Corps.
RICHARD RAMPELL - Mr. Rampell, joined the Board of Directors of the
Company effective July 27, 1995. Mr. Rampell, a certified public accountant,
is currently the Chief Executive of Rampell & Rampell, P.A., Certified Public
Accountants, of Palm Beach, Florida. Mr. Rampell is the past President of the
Palm Beach Tax Institute and a past President of the Florida Institute of
CPA's, East Coast Chapter. Mr. Rampell graduated with honors from Princeton
University with an A.B. degree and received an M.B.A. from the Wharton School
at the University of Pennsylvania.
7
<PAGE> 10
ELECTION OF EXECUTIVE OFFICERS
The Company's officers are elected annually by the Board of Directors
and serve at the discretion of the Board of Directors.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During the year ended December 31, 1995, the Board of Directors of the
Company held a total of (7) meetings and took a number of actions by unanimous
written consent. During 1995, no director attended fewer than 75% of the
aggregate of (i) the number of meetings of the Board of Directors held during
the period he served on the Board, and (ii) the number of meetings of
committees of the Board of Directors held during the period he served on such
committees.
Messrs. Swinburn, Sullivan and Rampell are the current members of the
Company's Audit Committee, which committee held (2) meetings during the year
ended December 31, 1995. The duties and responsibilities of the Audit
Committee include (a) recommending to the Board of Directors the appointment of
the Company's auditors and any termination of engagement, (b) reviewing the
plan and scope of audits, (c) reviewing the Company's significant accounting
policies and internal controls and (d) having general responsibility for all
related auditing matters.
Messrs. Swinburn, Sullivan and Rampell are also the current members of
the Company's Compensation Committee, which committee held (1) meeting during
the year ended December 31, 1995. The Compensation Committee reviews and
approves the compensation of the Company's executive officers and administers
each of the Company's compensation plans.
In addition to the foregoing committees, the Board has established an
Executive Committee consisting of Messrs. Gary Marino, John Marino and
Redfearn, and a Government Affairs Committee consisting of Messrs. John Marino,
Sullivan and Swinburn.
The Company does not have a standing nominating committee of the Board.
ADDITIONAL INFORMATION CONCERNING DIRECTORS
During 1995, each director of the Company who was not an officer or
employee of the Company received $1,000 per month, $500 per Board meeting and
$400 for each additional day spent on Company business. Effective March 1,
1996, compensation for directors that are not employees of the Company was
changed to a retainer of $2,000 per month, $500 per Board meeting and $400 for
each additional day spent on Company business. All directors are reimbursed
for reasonable out-of-pocket expenses associated with travel to meetings of the
Company's Board of Directors. Each non-employee director of the Company also
participates in the Company's 1995 Non-Employee Stock Option Plan.
COMPLIANCE WITH SECTION 16 OF THE SECURITIES EXCHANGE ACT OF 1934
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 (10%) of the Company's outstanding Common Stock, to file with the
Securities and Exchange Commission (the "SEC") initial reports of ownership and
reports of changes in ownership of Common Stock. Such persons are required by
SEC regulation to furnish the Company with copies of all such reports they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written or oral representations that
no other reports were required for such persons, during the year ended December
31, 1995, all Section 16(a) filing requirements applicable to its officers,
directors and greater than ten percent beneficial owners were complied with,
except for the late filing by John M. Sullivan of a Form 4 relating to the
purchase by his spouse of 100 shares of Common Stock in June 1995.
8
<PAGE> 11
EXECUTIVE COMPENSATION
The following table sets forth, for the years ended December 31, 1994
and 1995, the aggregate compensation awarded to, earned by or paid to Gary O.
Marino, the Company's Chief Executive Officer, and John H. Marino, the
Company's President (collectively, the "Named Executive Officers") during each
of such years. No other executive officer of the Company received compensation
in excess of $100,000 during such years. The Company did not grant any
restricted stock awards or stock appreciation rights or make any long term
incentive plan payouts during such years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------- ----------------------
NAME AND PRINCIPAL POSITION YEAR SALARY(1) BONUS OPTIONS(#)
- ------------------------------- ---- ----------- ------------ ----------------------
<S> <C> <C> <C> <C>
Gary O. Marino 1995 $ 200,000 $ 124,034(2) 350,000(4)
Chairman of the Board
and Chief Executive Officer 1994 $ 169,379 $ 140,000 -0-
John H. Marino 1995 $ 150,000 $ 37,650(3) -0-
President
1994 $ 137,584 $ 30,000 -0-
</TABLE>
- ------------------------
(1) The Company also provides certain members of senior management with
certain other personal benefits, including a car allowance, not
included in cash compensation. The aggregate amount of such benefits
did not exceed 10% of the cash compensation paid to or accrued for the
benefit of any executive officer or 10% of the cash compensation paid
to or accrued for all executive officers as a group.
(2) Includes a bonus of 50,000 shares of the Company's Common Stock
granted pursuant to Mr. Marino's employment agreement, which bonus was
valued at $93,750 as of the date of execution of the agreement in July
1995. Also includes a bonus of $30,284 which was paid to Mr. Gary
Marino in 1996 based upon the performance of the Company and its
subsidiaries for the year ended December 31, 1995.
(3) Represents a bonus paid to Mr. John Marino in 1996 based upon the
performance of the Company and its transportation subsidiaries for the
year ended December 31, 1995.
(4) Granted pursuant to the terms of Mr. Gary Marino's employment
agreement.
EMPLOYMENT AGREEMENTS
During 1993, until the HTG Merger, the Company contracted with HTG for
the services of its executive officers pursuant to a management agreement (the
"Management Agreement"). Pursuant to the Management Agreement, HTG provided
the Company with the management services of, among others, Messrs. John Marino,
Gary Marino and Donald Redfearn. The Company paid HTG aggregate management
fees and expenses of $350,000 for 1993, which amount also included
consideration for HTG's provision to the Company of substantial services in
addition to the services of the Company's executive officers. For the year
ended December 31, 1993, John Marino received $131,250 from HTG in cash
compensation. See "Certain Transactions." In 1993, HTG merged with
RailAmerica Services Corporation, a subsidiary of the Company. The purpose of
the HTG Merger was, among other things, to reduce the Company's long-term
operating expenses by facilitating (i) the eventual termination of the
Management Agreement and (ii) the direct employment by the Company of Messrs.
John Marino
9
<PAGE> 12
and Gary Marino. The Company entered into employment arrangements with each of
Messrs. Gary O. Marino and John H. Marino effective as of March 1, 1994.
Prior to July 1995, Gary Marino had an employment arrangement with the
Company which provided that he serve as Chief Executive Officer of the Company
and its subsidiaries. Under this arrangement, Gary Marino received a base
salary of $150,000 from March 1, 1994 through August 31, 1994, $175,000 from
September 1, 1994 through December 31, 1994 and $200,000 per year as of January
1, 1995. Mr. Marino's base salary is subject to increase in accordance with
the Consumer Price Index, as well as any additional increases in the discretion
of the Board of Directors. Commencing January 1, 1996, Gary Marino's base
salary was increased to $210,000. Mr. Marino was also entitled to a $642 per
month car allowance, subject to annual increase in accordance with the Consumer
Price Index. Under the arrangement Gary Marino was entitled to such benefits
(including medical, dental, disability and life insurance) as the Company and
its subsidiaries typically provided to its executive officers. The arrangement
also provided that Mr. Marino receive annual cash payments in lieu of his
participating in a retirement benefits plan.
In addition, Gary Marino's employment arrangement provided that he be
issued an aggregate of 50,000 shares of the Company's Common Stock upon the
execution of a formal employment agreement. All of these shares were issued to
Mr. Marino in July 1995 upon has execution of a written employment agreement.
Pursuant to Mr. Marino's employment agreement, Mr. Marino was also granted
non-qualified options to purchase an aggregate of 350,000 shares of Common
Stock of the Company at varying exercise prices and exercise dates. Options
for 87,500 shares at an exercise price of $3.10 and 87,500 shares at an
exercise price of $3.40 were immediately exercisable by Mr. Marino upon
execution of his written employment agreement. Additional options for 87,500
shares became exercisable under the agreement on March 1, 1996 at an exercise
price of $3.75 and options for 87,500 shares will become exercisable under the
agreement on March 1, 1997 at an exercise price of $4.15 per share, provided
Mr. Marino's employment has not been terminated by his voluntary resignation or
by the Company for cause as of such date. All such options have ten year terms
from the date they become exercisable. The agreement also provides that Mr.
Marino receive annual cash payments in lieu of his participating in a
retirement benefits plan. The agreement has an initial term expiring on March
1, 1998, and is subject to automatic one year renewal terms, unless either
party notifies the other of non-renewal 180 days prior to the expiration of the
current term. In the event Mr. Marino's employment is terminated without cause
pursuant to a change in control of the Company, Mr. Marino is entitled to
receive as of the date of termination a lump sum equal to 150% of his total
compensation in the 12 months prior to the date of termination. The agreement
also contains certain non-competition provisions applicable to Mr. Marino
should he resign from the Company or be terminated with cause.
John Marino's employment agreement provides for him to serve as
President of the Company and its transportation and distribution subsidiaries.
Under the agreement Mr. Marino received a base salary of $120,000 per year from
March 1, 1994 through August 31, 1994, $135,000 from September 1, 1994 through
December 31, 1994, and receives $150,000 per year as of January 1, 1995. Mr.
Marino's base salary is subject to increase in accordance with the Consumer
Price Index, as well as any additional increases in the discretion of the Board
of Directors. Commencing January 1, 1996, Mr. Marino's base salary was
increased to $154,200. Mr. Marino is also entitled to a $642 per month car
allowance, subject to annual increase in accordance with the Consumer Price
Index. Under the agreement, Mr. Marino is entitled to such benefits (including
medical, dental, disability and life insurance) as the Company and its
subsidiaries typically provide for their senior executive officers. The
agreement also provides that Mr. Marino receive annual cash payments in lieu of
participating in a retirement benefits plan. The agreement has an initial term
ending March 1, 1998, and is subject to automatic one year renewal terms,
unless either party notifies; the other of non-renewal 180 days prior to the
expiration of the current term. In the event Mr. Marino's employment is
terminated without cause pursuant to a change in control of the Company, he is
entitled to receive as of the date of termination a lump sum equal to 150% of
his total compensation in the 12 months prior to the date of termination. The
agreement contains certain non-competition provisions applicable to Mr. Marino
should he resign from the Company or be terminated with cause.
10
<PAGE> 13
STOCK OPTION AND BONUS PLANS
1992 STOCK OPTION PLAN
The Company maintains a 1992 Stock Option Plan which provides
officers, employees and consultants of the Company and its subsidiaries that
are not directors of the Company or 5% stockholders (directly or indirectly) of
the Company, with the ability to receive grants of incentive stock options (as
defined in Section 422(b) of the Internal Revenue Code of 1986, as amended
(the"Code")), and provides such individuals and non-employee directors that are
not 5% stockholders with the ability to receive nonqualified stock options.
The 1992 Stock Option Plan was approved by the Company's stockholders as of
July 1, 1992, and became effective as of such date. The Company has reserved
250,000 shares of Common Stock for the grant of options under the 1992 Stock
Option Plan; all of which have been granted and are currently outstanding at an
exercise price of $3.50 per share.
BONUS PLAN
In May 1995, the Board of Directors adopted the Corporate Senior
Executive Bonus Plan (the "Bonus Plan") pursuant to which participants in the
Bonus Plan receive cash bonuses based upon the annual performance of the
Company and its subsidiaries, commencing with the 1995 fiscal year. Bonuses
will be paid to designated individuals based on Company performance on a
consolidated basis, subsidiary performance or a combination of both.
Participants in the Bonus Plan which are subsidiary-specific shall
receive cash bonuses based upon objective, auditable and performance-related
criteria relating to the Company's subsidiaries. No subsidiary-specific
participant will be paid a bonus greater than 50% of the salary earned by that
participant for the full year. Subsidiary-specific participants will be
designated by the Chief Executive Officer subject to ratification by the
Compensation Committee. Bonuses paid to participants for consolidated Company
performance will be paid from a bonus pool equal to 12% of any pre-tax
consolidated income in excess of that amount required to achieve a 12% return
on average stockholders' equity. The initial participants in the Bonus Plan to
receive awards based on consolidated Company performance include Messrs. Gary
Marino and John Marino. The Compensation Committee determines the appropriate
treatment of year end results in the calculation, based on the recommendation
of the Chief Executive Officer, if appropriate. No participant will be paid a
bonus based on consolidated Company performance greater than the salary earned
by that participant for the full year.
1995 STOCK PLANS
The following plans were approved by the Company's stockholders at the
Company's 1995 Annual Meeting, in July 1995:
1995 STOCK INCENTIVE PLAN. The Board of Directors of the Company has
adopted, effective January 1, 1995, a 1995 Stock Incentive Plan (the "Stock
Incentive Plan"). Pursuant to the Stock Incentive Plan, key personnel of the
Company who have been selected as participants are eligible to receive awards
of various forms of equity-based incentive compensation, including stock
options, stock appreciation rights, stock bonuses, restricted stock awards,
performance units and phantom stock, and awards consisting of combinations of
such incentives. The Stock Incentive Plan is administered by the Compensation
Committee. Subject to the provisions of the Stock Incentive Plan, the
Compensation Committee has sole discretionary authority to interpret the Stock
Incentive Plan and to determine the type of awards to grant, when, if and to
whom awards are granted, the number of shares covered by each award and the
terms and conditions of the award. Options granted under the Stock Incentive
Plan may be "incentive stock options" ("ISOs"), within the meaning of Section
422 of the Internal Revenue Code, or nonqualified stock options ("NQSOs"). The
exercise price of the options is determined by the Compensation Committee at
the time the options are granted, subject to a minimum price in the case of
ISOs equal to the fair market value of the Common Stock on the date of grant
and a minimum price in the case of NQSOs of the par value of the Common Stock.
The Company has reserved 250,000 shares of Common Stock for issuance
under the Stock Incentive Plan. Options to purchase 141,000 shares and 95,000
shares of the Company's Common Stock were granted on January
11
<PAGE> 14
1, 1995 and January 1, 1996, respectively, under the Stock Incentive Plan. The
January 1, 1995 and 1996 options have exercise prices of $3.50 and $3.625 per
share, respectively.
1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN. The Board of Directors
of the Company has adopted, effective January 1, 1995, the 1995 Non-Employee
Director Stock Option Plan (the "Directors Plan"), under which 250,000 shares
of Common Stock have been reserved for issuance. Pursuant to the Directors
Plan, directors of the Company who are not also employees of the Company
("Non-Employee Directors") are granted options to purchase Common Stock. The
Directors Plan is administered by the Compensation Committee, the members of
which are also participants therein. Subject to the provisions of the
Directors Plan, the Compensation Committee has sole discretionary authority to
construe, interpret and apply the terms of the Directors Plan, to determine all
questions thereunder, and to adopt and amend rules and regulations for the
administration thereof as it may deem desirable.
Under the terms of the Directors Plan, each Non-Employee Director
shall be granted an option to purchase 50,000 shares of Common Stock on the
date such person is first elected to become a director of the Company. The
term of the Directors Plan is ten years from the effective date, after which no
further options will be granted thereunder. Options granted under the
Directors Plan expire ten years from the date of grant. The exercise price per
share of each option granted under the Directors Plan will be the fair market
value of the Common Stock on the date prior to the date the option is granted.
Options granted under the Directors Plan vest over a period of three years at
the rate of one-third annually on each anniversary date of the date of grant,
provided the Non-Employee Director to whom the options are granted continues to
serve as a director on each such vesting date.
As of the date hereof, options to purchase 10,000 shares of the
Company's Common Stock have been granted to Donald D. Redfearn under the
Directors Plan, at an exercise price of $3.50 per share, options to purchase
50,000 shares of the Company's Common Stock have been granted to Charles
Swinburn under the Directors Plan at an exercise price of $4.19 per share and
options to purchase 50,000 shares of the Company's Common Stock have been
granted to Richard Rampell under the Directors Plan at an exercise price of
$4.81 per share.
1995 EMPLOYEE STOCK PURCHASE PLAN. The Board of Directors of the
Company has adopted, effective January 1, 1995, the 1995 Employee Stock
Purchase Plan (the "Stock Purchase Plan"), under which 250,000 shares of Common
Stock are reserved for issuance. During the first quarter of 1996, the Company
implemented the Stock Purchase Plan. The Stock Purchase Plan, which is
designed to qualify under Section 423 of the Code, is designed to encourage
stock ownership by employees of the Company. Employees of the Company other
than members of the Board of Directors and owners of 5% or more of the
Company's Common Stock are eligible to participate in the Stock Purchase Plan,
with certain exceptions, if they are employed by the Company for at least 20
hours per week and more than five months per year. No employee is eligible to
participate who, after the grant of options under the Stock Purchase Plan, owns
(including all shares which may be purchased under any outstanding option) 5%
or more of the Company's Common Stock.
On January 1 of each year (the "Enrollment Date"), the Company will
grant to each participant an option to purchase on December 31 of each such
year (the "Exercise Date") at a price determined in the manner described below
(the "Purchase Price") the number of full shares of Common Stock which his or
her accumulated payroll deductions on the Exercise Date will purchase at the
Purchase Price. The Purchase Price will be the lesser of (i) a percentage (not
less than 85%) of the fair market value of the Common Stock on the Enrollment
Date, or (ii) a percentage (not less than 85%) of the fair market value of the
Common Stock on the Exercise Date. As soon as practicable after any Exercise
Date on which a purchase of shares of Common Stock occurs, the Company will
deliver to each participant, a certificate representing the shares purchased
upon exercise of his or her option; however, the Compensation Committee may
determine to hold a participant's certificates until the participant ceases
participation in the Stock Purchase Plan or requests delivery of the
certificates.
12
<PAGE> 15
OPTION/SAR GRANT TABLE
The following table sets forth information concerning grants of stock
options made during the year ended December 31, 1995 to the Named Executive
Officers. All stock options granted to Mr. Gary O. Marino were granted
pursuant to his employment agreement. See "Executive Compensation - Employment
Agreements." No stock appreciation rights were granted.
<TABLE>
<CAPTION>
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/
UNDERLYING SARS GRANTED TO
OPTIONS/ EMPLOYEES IN EXERCISE EXPIRATION
NAME SARS GRANTED FISCAL YEAR PRICE DATE
- ------------------- -------------- ----------------- ----------- ------------
<S> <C> <C> <C> <C>
Gary O. Marino 350,000(1) 71% $3.10-$4.15 11/11/04
John H. Marino 0 N/A N/A N/A
</TABLE>
- ----------------------------
(1) Represents options to purchase (i) 87,500 shares of Common Stock at an
exercise price of $3.10 per share, (ii) 87,500 shares of Common Stock
at an exercise price of $3.40 per share, (iii) 87,500 shares of Common
Stock at an exercise price of $3.75 per share and (iv) 87,500 shares
of Common Stock at an exercise price of $4.15 per share, all of which
options were granted to Mr. Gary Marino pursuant to the terms of his
employment agreement. See "Executive Compensation - Employment
Agreements."
AGGREGATED FISCAL YEAR-END OPTION VALUE TABLE
The following table sets forth certain information concerning
unexercised stock options held by the Named Executive Officers as of December
31, 1995. No stock options were exercised by the Named Executive Officers
during the year ended December 31, 1995. No stock appreciation rights were
granted or are outstanding.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS HELD AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1995 (#) DECEMBER 31, 1995 ($)
ACQUIRED ON VALUE ----------------------------- ----------------------------
NAME EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
-------------------------- ------------ ------------ ----------------------------- ----------------------------
<S> <C> <C> <C> <C> <C> <C>
Gary O. Marino . . . . . 0 0 215,000 175,000 $ 70,625(1) (2)
John H. Marino . . . . . 0 0 0 0 N/A N/A
</TABLE>
- ------------------------------
(1) The closing sale price of the Common Stock on December 29, 1995 as
reported by NASDAQ was $3.625 per share. Value is calculated by
multiplying (a) the difference between $3.625 and each option exercise
price by (b) the number of shares of Common Stock underlying each such
option. At December 31, 1995, Mr. Marino had been granted the
following options to purchase Common Stock, which options were
exercisable at year end: (i) options to purchase 40,000 shares of
Common Stock at an exercise price of $3.50 per share, (ii) options to
purchase 87,500 shares of Common Stock at an exercise price of $3.10
per share and (iii) options to purchase 87,500 shares of Common Stock
at an exercise price of $3.40 per share. In addition, at December 31,
1995, Mr. Marino held the following options to purchase Common Stock,
which options were not exercisable at year end: (i) options to
purchase 87,500 shares of Common Stock at an exercise price of $3.75
per share and (ii) options to purchase 87,500 shares of Common Stock
at an exercise price of $4.15 per share.
(2) The unexercisable portion of options held by Mr. Marino were not
in-the-money as of December 31, 1995.
13
<PAGE> 16
CERTAIN TRANSACTIONS
During 1993, the Company was a party to the Management Agreement with
HTG regarding the provision to the Company of management and financial
services, executive officers, administrative support staff and office space and
equipment. All of the issued and outstanding shares of capital stock of HTG,
prior to the HTG Merger, were owned by BRCC, a former stockholder of the
Company, and Messrs. John Marino and Eric D. Gerst, a former director of the
Company. For the year ended December 31, 1993, John Marino received $131,250
from HTG in cash compensation. In addition, Mr. Gary Marino received $37,250
in consulting fees from HTG in 1993. Until October and September of 1993,
respectively, Messrs. Gary Marino and Redfearn were officers and directors of
BRCC. BRCC received management and accounting fees and other compensation
totaling $78,750 from HTG in 1993, representing, in part, compensation to BRCC
for providing the services of Messrs. Gary Marino and Redfearn.
BRCC, a former stockholder of the Company, received aggregate fees of
$248,756 in 1993 from the Company for assisting in structuring and negotiating
proposed acquisitions and reimbursement for associated services. Fees paid by
the Company to BRCC for services rendered in 1994 did not exceed $60,000. No
fees were paid to BRCC by the Company in 1995.
Jenex Financial Corporation, of which Donald D. Redfearn was an
executive officer and principal stockholder received $70,479 and 40,274 shares
of the Company's Common Stock in 1994, which shares were valued at $1.75 per
share at the time of issuance, for assisting the Company obtain financing for
its acquisition of Kalyn Sibert Incorporated, a subsidiary of the Company.
Additionally, Donald Redfearn and companies in which he was a principal
stockholder received $72,000 in fees during 1995 for consulting services
performed for the benefit of the Company and its subsidiaries.
On June 6, 1995, the Company consummated the settlement of litigation
brought against the Company and certain of its subsidiaries by Eric D. Gerst, a
former employee and director of the Company. Pursuant to a settlement
agreement dated as of March 15, 1995, Mr. Gerst dismissed the lawsuit with
prejudice and provided general releases to the Company and the Company's
RailAmerica Services Corporation and HESR subsidiaries, among others. In
addition, the Company repurchased from Mr. Gerst and certain of his family
members 190,000 shares of Common Stock, constituting all shares of Common Stock
owned by them, and certain pieces of equipment consisting of locomotives and
other rolling stock for an aggregate cash payment of $1 million. Additionally,
the Company issued to Mr. Gerst a warrant entitling him to purchase 127,500
shares of Common Stock at an exercise price of $4.25 per share, which warrant
is exercisable until September 15, 1998. Upon further consideration and review
by the Company, the suspension of Mr. Gerst from his duties as an officer of
the Company had been rescinded, annulled and retracted retroactively to its
effective date, July 15, 1994. Mr. Gerst voluntarily resigned as an officer
and director of the Company on January 17, 1995.
The Company believes that all of the transactions described above were
on terms comparable to those that might have been obtained from unaffiliated
parties.
OTHER BUSINESS; REPRESENTATIVES OF THE COMPANY'S AUDITORS
The Board of Directors knows of no other business to be brought before
the 1996 Annual Meeting. If, however, any other business should properly come
before the 1996 Annual Meeting, the persons named in the accompanying proxy
will vote proxies as in their discretion they may deem appropriate, unless they
are directed by a proxy to do otherwise.
Representatives of Coopers & Lybrand LLP, the Company's independent
auditors, are not expected to be present at the Annual Meeting, and,
accordingly, may not be available to respond to stockholder inquiries.
14
<PAGE> 17
INFORMATION CONCERNING STOCKHOLDER PROPOSALS
Pursuant to Rule 14a-8 promulgated by the Securities and Exchange
Commission, a stockholder intending to present a proposal to be included in the
Company's proxy statement for the Company's 1997 Annual Meeting of Stockholders
must deliver a proposal in writing to the Company's principal executive offices
no later than February 26, 1997.
By Order Of The Board of Directors
GARY O. MARINO
Chairman of the Board and
Chief Executive Officer
Boca Raton, Florida
June 27, 1996
15
<PAGE> 18
Appendix A
RAILAMERICA, INC.
301 YAMATO ROAD, SUITE 1190
BOCA RATON, FLORIDA 33341
THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS
COMMON STOCK
The undersigned holder of Common Stock of RailAmerica, Inc., a Delaware
corporation (the "Company"), hereby appoints Gary O. Marino and John H. Marino,
and each of them, as proxies for the undersigned, each with full power of
substitution, for and in the name of the undersigned to act for the undersigned
and to vote as designated on the reverse, all of the shares of Common Stock of
the Company that the undersigned is entitled to vote at the 1996 Annual
Meeting of Stockholders of the Company, to be held on Wednesday, July 24, 1996,
at 10:00 a.m., local time, at the Boca Raton Marriott at Town Center, 5150 Town
Center Circle, Boca Raton, Florida, or at any adjournments(s) or
postponement(s) thereof.
The Board of Directors recommends a vote FOR the election of all the
director nominees listed in the proposals set forth on the reverse side of this
proxy card.
SEE REVERSE SIDE
/X/ Please mark your
vote as in this
example
<TABLE>
<S> <C> <C> <C>
VOTE FOR VOTE
all nominees listed WITHHELD
except as indicated for
to the contrary below all nominees
1. Election of Nominees:
Directors / / / / Class I Directors
of the -----------------
Company Donald D. Redfearn
Charles Swinburn
(INSTRUCTIONS: To withhold authority to vote for any director
indicate any such director here) Class II Directors
------------------
Robert F. Toia
---------------------------------------------------------------
Class III Directors
-------------------
Douglas R. Nichols
</TABLE>
In their discretion the proxies are authorized to vote
upon such other business as may properly come before
the 1996 Annual Meeting, and any adjournments or
postponements thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED
IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED
STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED "FOR" ALL OF THE PROPOSALS.
The undersigned hereby acknowledges receipt of
(i) the Notice of Annual Meeting, (ii) the Proxy
Statement and (iii) the Company's 1996 Annual Report to
Stockholders.
PLEASE MARK, SIGN, AND DATE THIS PROXY CARD AND PROMPTLY
RETURN IT IN THE ENVELOPE PROVIDED. NO POSTAGE
NECESSARY IF MAILED IN THE UNITED STATES.
Signature Dated: , 1996
----------------------- ---------------------- --------
IMPORTANT: Please sign exactly as your name appears hereon and mail it
promptly even though you may plan to attend the meeting. When shares are held
by joint tenants both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name by a duly
authorized person.
