<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<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>
RENEX CORP.
- --------------------------------------------------------------------------------
(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] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
RENEX CORP.
2100 PONCE DE LEON BOULEVARD, SUITE 950
CORAL GABLES, FLORIDA 33134
---------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 30, 1998
---------------------
To the Stockholders of Renex Corp.
NOTICE is hereby given that the Annual Meeting of Stockholders of Renex
Corp., a Florida corporation (the "Company"), will be held at the Coral Gables
Hyatt, 50 Alhambra Plaza, Coral Gables, Florida 33134, on Tuesday, June 30, 1998
at 10:00 A.M., for the following purposes:
1. To elect three (3) Class II directors, each for a term of three (3)
years.
2. To act upon a proposal to adopt an amendment to the Company's
Employee Stock Option Plan.
3. To transact such other business as may properly come before the
Annual Meeting or any adjournment thereof.
Only stockholders of record at the close of business on May 4, 1998 shall
be entitled to receive notice of, and to vote at, the Annual Meeting and any
postponements or adjournments thereof. A complete list of the stockholders
entitled to vote at the Annual Meeting will be available for inspection by
stockholders at the Annual Meeting.
Whether or not you expect to attend the Annual Meeting, please vote, date,
sign, and return the enclosed proxy as promptly as possible to assure
representation of your shares at the meeting. You may revoke your proxy at any
time prior to its exercise by written notice to the Company prior to the Annual
Meeting, or by attending the Annual Meeting in person and voting.
By Order of the Board of Directors
MARK D. WALLACE
Secretary
Coral Gables, Florida
Dated: May 5, 1998
YOUR VOTE IS IMPORTANT. ACCORDINGLY YOU ARE ASKED TO COMPLETE, SIGN, DATE AND
RETURN THE ACCOMPANYING PROXY CARD IN THE ENVELOPE PROVIDED, WHICH REQUIRES NO
POSTAGE IF MAILED IN THE UNITED STATES.
<PAGE> 3
RENEX CORP.
2100 PONCE DE LEON BOULEVARD, SUITE 950
CORAL GABLES, FLORIDA 33134
---------------------
PROXY STATEMENT
---------------------
ANNUAL MEETING OF STOCKHOLDERS
JUNE 30, 1998
This Proxy Statement and the accompanying Notice of Annual Meeting and
Proxy Card are being furnished to stockholders of Renex Corp., a Florida
corporation (the "Company"), in connection with the solicitation of proxies by
the Board of Directors of the Company for use at the Company's 1998 Annual
Meeting of Stockholders (the "Annual Meeting") to be held at 10:00 A.M., local
time, on June 30, 1998 at the Coral Gables Hyatt, 50 Alhambra Plaza, Coral
Gables, Florida, and at any and all postponements or adjournments thereof, for
the purposes set forth in the accompanying Notice of Annual Meeting.
This Proxy Statement, Notice of Annual Meeting, and the accompanying Proxy
Card are first being mailed to stockholders on or about May 6, 1998 to all
stockholders of record as of May 4, 1998. At the annual meeting, stockholders
will be asked to elect three Class II directors, approve an amendment to the
Company's Employee Stock Option Plan and to vote on such other matters as may
properly come before the Annual Meeting.
Because many of the Company's stockholders are unable to attend the Annual
Meeting in person, the Board of Directors solicits proxies by mail to give each
stockholder an opportunity to vote on all matters that will come before the
Annual Meeting. Stockholders are urged to:
(1) Read this Proxy Statement carefully;
(2) Specify their choice on each matter by marking the appropriate box
on the enclosed Proxy Card; and
(3) Sign, date and return the Proxy Card in the enclosed envelope.
If Proxy Cards are returned properly signed, the shares represented thereby
will be voted by the persons named in the Proxy Card, or their substitute, in
accordance with the stockholder's directions. If the Proxy Card is signed and
returned without instructions marked on it, it will be voted FOR the nominees
for Class II directors listed on the Proxy, FOR the amendment to the Employee
Stock Option Plan and as recommended by the Board of Directors with respect to
any other matters which may properly come before the Annual Meeting. A
stockholder must return a signed Proxy Card to permit the proxy holders to vote
the shares owned by such stockholder.
A stockholder granting a proxy may revoke it at any time prior to the
Annual Meeting by giving written notice of its revocation to the Company, by
submission of another duly executed proxy dated after the Proxy Card to be
revoked, or by attending the Annual Meeting and voting in person. The mere
presence at the Annual Meeting by a stockholder who has appointed a proxy will
not revoke the prior appointment.
The Board of Directors has designated James P. Shea and Arthur G. Shapiro
and each or either of them, as proxies to vote the shares of common and
preferred Stock solicited on its behalf.
Only stockholders of record as of the close of business on May 4, 1998 (the
"Record Date") are entitled to notice of, and to vote at, the Annual Meeting and
any adjournment thereof. On the Record Date, there were issued and outstanding
6,977,372 shares of common stock, $.001 par value (the "Common Stock"). Each
stockholder is entitled to one vote for each share of Common Stock registered in
his name on the Record Date for each matter brought before the stockholders at
the Annual Meeting. The presence, in person or by proxy, of a majority of the
Common Stock entitled to vote is required for a quorum at the Annual Meeting. In
determining whether a quorum exists at the Annual Meeting, all votes "for" or
"against," as well as
<PAGE> 4
abstentions, will be counted. Broker non-votes will also be counted as present
or represented for the purpose of determining whether a quorum is present for
the transaction of business.
ELECTION OF DIRECTORS
The Board of Directors is currently divided into three classes, having
three year terms that expire in successive years. The term of office of Class II
directors expires at the 1998 Annual Meeting. The Board of Directors proposes
that the nominees described below, all of whom are currently serving as Class II
directors, be re-elected as Class II directors for a new term of three years and
until their respective successors are duly elected and qualified, except in the
event of their earlier death, resignation or removal. Each of the nominees has
consented to serve a three year term. The Company has no reason to believe that
any of the nominees will be unable or unwilling to serve, if elected. If any
nominee should become unavailable prior to the election, the accompanying Proxy
Card will be voted for the election in his stead, of such other person as the
Board of Directors may recommend.
NOMINEES FOR CLASS II DIRECTOR
Information regarding the Board's nominees for election as directors is set
forth below.
JAMES P. SHEA
DIRECTOR SINCE 1993
AGE 57
Mr. Shea has been President and Chief Executive Officer of the Company
since August 1993. From July 1992 until June 1993, he served as Director General
for Home Intensive Care, Inc.'s international division. From 1986 to 1990, he
was Senior Vice President of Protocare, Inc., an infusion therapy and
respiratory care provider, which he helped establish. From 1985 to 1986, he was
General Manager of the health care products division of The Norton Company, a
manufacturer of engineered materials. From 1983 to 1985, he was President of the
infusion division of National Medical Care, Inc., a kidney dialysis and infusion
therapy provider, which is now owned by Fresenius Medical Care AG. Mr. Shea is a
member of the Company's Executive Committee.
JOHN E. HUNT, SR.
DIRECTOR SINCE 1993
AGE 80
Since August 1983, Mr. Hunt has been Chairman of the Board of Hunt
Insurance Group, Inc., an insurance agency holding company. For the previous 40
years, Mr. Hunt was President of John E. Hunt & Associates, a Tallahassee and
Miami, Florida insurance agency. For the past 13 years, he has also been
President of Insurance Consultants and Analysis, Inc., an insurance consulting
firm. Mr. Hunt serves as Chairman of the Board of Trustees of the Florida Police
Chiefs' Education and Research Foundation, Inc. and as a trustee of Florida
Southern College. Mr. Hunt was a Director of Home Intensive Care, Inc. from 1985
until July 1993. Mr. Hunt is a member of the Company's Compensation and Stock
Option Committees.
MARK D. WALLACE
DIRECTOR SINCE 1993
AGE 30
Mr. Wallace has been Secretary of the Company since the Company's inception
in July 1993. Since July 1992, Mark Wallace has been a practicing attorney and
is currently a partner at the law firm of Stack, Fernandez and Anderson, P.A.
Mr. Wallace is the son of Milton J. Wallace, Chairman of the Board of the
Company.
2
<PAGE> 5
DIRECTORS CONTINUING IN OFFICE
CLASS I DIRECTORS. The following Class I directors were elected at the
Company's 1997 Annual Meeting, for terms ending in 2000:
EUGENE P. CONESE, SR.
DIRECTOR SINCE 1996
AGE 68
Since September 1997, Mr. Conese has been Chairman of the Board of World
Air Lease, Inc. and serves as consultant to General Electric Company's Engine
Services division. From 1987 until September 1997, he served as Chairman of the
Board of Directors and Chief Executive Officer of Greenwich Air Services, Inc.,
a provider of repair and overhaul services for gas turbine aircraft engines
which he founded in 1977. Greenwich Air Services, Inc. was acquired by General
Electric Company in September 1997. Mr. Conese was the founder of The Greenwich
Company, Ltd. and served as its Chairman of the Board and Chief Executive
Officer from August 1980 until 1995, when it merged with Greenwich Air Services,
Inc. Mr. Conese is a Director of Trans World Airlines, Inc., a member of the
Board of Trustees of Iona College and of the Board of The Conese Foundation. Mr.
Conese is chairman of the Company's Compensation and Stock Option Committee.
CHARLES J. SIMONS
DIRECTOR SINCE 1993
AGE 79
Mr. Simons is the Chairman of the Board of G.W. Plastics, Inc., a plastics
manufacturer, and is an independent management and financial consultant. From
1940 to 1981, he was employed by Eastern Airlines, last serving as Vice
Chairman, Executive Vice President and as a Director. Mr. Simons is a Director
of Arrow Air, Inc., a cargo air carrier; Bessemer Trust of Florida, an
investment management firm; Calspan Corporation, an aerospace company; and a
number of private companies. He was also a Director of Home Intensive Care, Inc.
from 1988 until July 1993. Mr. Simons is the Chairman of the Board of the
Matthew Thornton Health Plan. Mr. Simons is chairman of the Company's Audit
Committee and a member of the Compensation and Stock Option Committee.
JEFFREY H. WATSON
DIRECTOR SINCE 1994
AGE 39
Since December 1995, Mr. Watson has been Chairman of the Board and
President of J. Watson & Co., a government relations and business consulting
firm. From June 1994 until December 1995, he was Vice President for Government
Relations of the Jefferson Group, an independent public affairs firm. From
January 1993 until June 1994, Mr. Watson served as Deputy Assistant for
Inter-Governmental Affairs for the Clinton Administration. From December 1991
through November 1992, Mr. Watson was employed by the election campaign for
President Clinton. From 1989 until November 1991, Mr. Watson served as Finance
Administrator for the City of Miami, Florida's Department of Development and
Housing Conservation. From 1986 until January 1989, he served as an
Administrative Assistant for the Mayor of Miami, Florida. From September 1985
through March 1986, he was a Managing Partner and Chief Financial Manager of J.
Howard Industries, a company involved in low-income housing redevelopment and
construction. Mr. Watson is a member of the Company's Audit Committee.
3
<PAGE> 6
CLASS III DIRECTORS. The following Class III directors were elected at the
1996 Annual Meeting for terms ending in 1999:
MILTON J. WALLACE
DIRECTOR SINCE 1993
AGE 62
Mr. Wallace is a co-founder of the Company and has been Chairman of the
Board of the Company since its inception in July 1993. Mr. Wallace has been a
practicing attorney in Miami for over 30 years and is currently a shareholder in
the law firm of Wallace, Bauman, Fodiman & Shannon, P.A. He was a co-founder and
a member of the Board of Directors of Home Intensive Care, Inc., a provider of
home infusion and dialysis services, serving as Chairman of its Executive
Committee from 1985 through July 1993 and Chairman of the Board from December
1989 until July 1993. Home Intensive Care, Inc. was acquired by W.R. Grace & Co.
in July 1993. Mr. Wallace is Chairman of the Board of Med/Waste, Inc., a
provider of medical waste management services. He is a director of several
private companies and is Chairman of the Dade County Florida, Housing Finance
Authority. Mr. Wallace is a member of the Company's Executive Committee and is
the father of Mark D. Wallace, a Director of the Company.
ARTHUR G. SHAPIRO, M.D.
DIRECTOR SINCE 1993
AGE 59
Dr. Shapiro is a co-founder of the Company and has been Vice Chairman of
the Company's Board and Director of Medical Affairs since the Company's
inception in July 1993. Dr. Shapiro has held an appointment to the University of
Miami School of Medicine as a professor of clinical obstetrics and gynecology
since January 1995. From 1985 until 1995, he was engaged in the private practice
of medicine. He is board certified in obstetrics and gynecology, reproductive
endocrinology and laser surgery. He is a Fellow in the American College of
Obstetrics and Gynecology and the American College of Endocrinology. Dr. Shapiro
was a co-founder of Home Intensive Care, Inc. and served on its Board of
Directors from 1985 until July 1993. Dr. Shapiro also served as Home Intensive
Care, Inc.'s Medical Director from 1990 until July 1993. He serves as Chairman
of the Board of Bankers Savings Bank, Coral Gables, Florida and as a Director of
Med/Waste, Inc. Dr. Shapiro is Chairman of the Company's Executive Committee.
C. DAVID FINCH, M.D.
DIRECTOR SINCE 1995
AGE 38
Dr. Finch is a board certified nephrologist and maintains a private
practice of medicine in nephrology and hypertension in Jackson, Mississippi. Dr.
Finch serves as the Medical Director of three of the Company's dialysis
facilities in Mississippi and Louisiana. He also serves as Director of Dialysis
at Vicksburg Medical Center and Parkview Regional Medical Center. He is a
principal in JCD Partnership, a real estate and property management firm, and
the brother of Jeffery C. Finch, a Vice President of the Company.
DIRECTORS' REMUNERATION; ATTENDANCE
DIRECTORS' COMPENSATION. Directors who are officers or employees of the
Company receive no additional compensation for their service as members of the
Board of Directors. Non-employee directors do not currently receive any cash
compensation for service on the Board of Directors, but receive reimbursement of
expenses. Non-employee directors receive annual grants of options under the
Directors Stock Option Plan ("Directors Plan") described below. In addition,
Milton J. Wallace and Dr. Shapiro, each received options to purchase 16,667
shares of Common Stock in April 1995 as compensation for services rendered to
the Company. Such options have an exercise price of $6.00 per share and are
exercisable through April 2000. See "Compensation -- Directors Stock Option
Plan".
4
<PAGE> 7
BOARD ATTENDANCE. The Board of Directors met six (6) times in 1997. Every
director attended in excess of 75% of meetings of the Board during 1997, except
for Dr. Finch who attended 67% of such meetings.
COMMITTEES OF THE BOARD
The Board has established a number of standing committees to assist it in
the discharge of its responsibilities. The principal responsibilities of each
standing committee are described below. Actions taken by any committee of the
Board are reported to the Board of Directors, usually at the next Board meeting.
The Board has standing Executive, Compensation and Stock Option and Audit
Committees.
EXECUTIVE COMMITTEE. The Executive Committee is composed of Dr. Shapiro as
Chairman and Messrs. Wallace and Shea. When the Board of Directors is not in
session, the Executive Committee possesses all of the powers of the Board, other
than certain powers reserved by Florida law to the Board. Although the Executive
Committee has broad powers, in practice it meets only infrequently to take
formal action in a specific matter when it would be impractical to call a
meeting of the Board. The Executive Committee met two (2) times in 1997.
COMPENSATION AND STOCK OPTION COMMITTEE. The Compensation and Stock Option
Committee, composed of Messrs. Conese, Hunt and Simons met three times in 1997.
The Compensation Committee reviews the Company's general compensation policies
and procedures; establishes salaries and benefit programs for the Chief
Executive Officer and other executive officers of the Company and its
subsidiaries; reviews, approves and establishes performance targets and awards
under incentive compensation plans for its executive officers; and reviews and
approves employment agreements. The Compensation and Stock Option Committee also
administers the Company's Employee Stock Option Plan and has the authority to
determine, among other things, to whom to grant options, the amount of options,
the terms of options and the exercise prices thereof.
AUDIT COMMITTEE. The Audit Committee, composed of Messrs. Simons and
Watson, met two (2) times in 1997. The principal duties of the Audit Committee
are to recommend the appointment of independent auditors; to meet with the
Company's independent auditors to review the arrangements for, and scope of, the
audit and the fees related to such work; to review the independence of the
independent auditors; to consider the adequacy of the system of internal
accounting controls; to review and monitor the Company's policies regarding
conflicts of interest; and to discuss with management and the independent
accountants the Company's annual financial statements.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION. None of the
members of the Board's Compensation and Stock Option Committee is, or has been,
an officer or employee of the Company.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING REQUIREMENTS
The Company's officers and directors are required to file Forms 3, 4 and 5
with the Securities and Exchange Commission in accordance with Section 16(a) of
the Securities and Exchange Act of 1934, as amended and the rules and
regulations promulgated thereunder. Based solely on a review of such reports
furnished to the Company as required by Rule 16(a)-3, no director or executive
officer failed to timely file such reports in 1997.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE
"FOR" THE ELECTION OF ALL THE NOMINEES.
The three nominees for Class II receiving the greatest number of
affirmative votes of the shares of Common Stock represented at the Annual
Meeting will be elected as Class II directors. Stockholders are not entitled to
cumulate their votes for the election of directors. Proxies received by the
Board of Directors will be so voted in favor of all Class II nominees above,
unless stockholders specify a contrary choice in their proxies.
5
<PAGE> 8
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table summarizes the compensation earned by, and paid to, the
Company's Chief Executive Officer ("CEO") and for each other executive officer
who received compensation in excess of $100,000 for each year in the two (2)
year period ended December 31, 1997 (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARD
------------
SECURITIES
OTHER ANNUAL UNDERLYING
NAME AND PRINCIPAL POSITION YEAR SALARY(1) BONUS COMPENSATION OPTIONS(#)
- --------------------------- ---- --------- ------ ------------ ------------
<S> <C> <C> <C> <C> <C>
James P. Shea................................ 1997 $128,465 $ -- $8,630 33,334
President and CEO 1996 110,000 -- 5,160 13,334
Orestes L. Lugo.............................. 1997 $114,617 $ -- $7,110 26,667
Vice President -- Finance and CFO 1996 102,500 4,000 5,160 11,667
</TABLE>
- ---------------
(1) The Company provides its officers with certain non-cash group life and
health benefits generally available to all salaried employees. Such benefits
are not included in the above table pursuant to applicable Securities and
Exchange Commission rules. No Named Executive Officer received aggregate
personal benefits or perquisites that exceed the lesser of $50,000 or 10% of
his total annual salary and bonus for such year.
OPTIONS GRANTED IN LAST FISCAL YEAR
The following table sets forth information concerning grants of stock
options to the CEO and each other Named Executive Officer named on the Summary
Compensation Table above, for the year ended December 31, 1997:
OPTIONS GRANTED IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATE OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS EXERCISE APPRECIATION FOR
UNDERLYING GRANTED TO OR BASE OPTION TERM($)(3)
OPTIONS EMPLOYEES IN PRICE EXPIRATION --------------------
NAME GRANTED(#)(1) FISCAL YEAR ($/SHARE) DATE 5% 10%
- ---- ------------- ------------ --------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
James P. Shea................. 33,334 21% $8.00 4/21/02 $73,700 $162,800
Orestes L. Lugo............... 26,667 17 8.00 4/21/02 58,900 130,200
</TABLE>
- ---------------
(1) All such options were granted pursuant to the 1994 Employee Stock Option
Plan. Options granted during fiscal year 1997 vest over three years, with
25% of such options vesting six months following the date of grant, 25% on
the first anniversary from the date of grant and 25% at the end of each
succeeding year from the grant date.
(2) Based on an aggregate of 159,704 options granted to employees in 1997,
including the Named Executive Officers.
(3) The 5% and 10% assumed rates of appreciation are mandated by the rules of
the Securities and Exchange Commission and do not represent the Company's
estimate or projection of the future Common Stock price.
6
<PAGE> 9
AGGREGATED OPTION EXERCISES IN FISCAL 1997 AND FISCAL YEAR END OPTION VALUES
The following table sets forth certain aggregated option information for
the CEO and each Named Executive Officer named in the Summary Compensation Table
for the year ended December 31, 1997:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS(2) IN-THE-MONEY OPTIONS(2)
---------------------------- ----------------------------
NAME(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
James P. Shea........................ 32,085 34,584 -- --
Orestes L. Lugo...................... 18,751 27,917 -- --
</TABLE>
- ---------------
(1) No options were exercised by the above Named Executive Officers during the
fiscal year ended December 31, 1997.
(2) The value of unexercised options represents the difference between the
exercise price of the options and the closing sales price of the Company's
Common Stock on December 31, 1997 of $5.25 as reported by NASDAQ/NMS.
EMPLOYMENT AGREEMENT
In April 1997, the Company entered into two year employment agreements with
James P. Shea, the Company's President and Chief Executive Officer, and Orestes
L. Lugo, Vice President -- Finance and Chief Financial Officer. The employment
agreements provide for base salaries of $190,000 and $155,000 for Mr. Shea and
Mr. Lugo, respectively. Base salary for each officer is increased on the
anniversary of each year during the term by a minimum of 6%. Each officer
receives an automobile allowance and certain other non-cash benefits, including
life, health and disability insurance. Each employment agreement is
automatically renewed for two years at the end of the initial term and each
extended term, unless either party provides notice of termination at least 90
days prior to the expiration of such term. If either officer is terminated
without cause during the term of their respective agreements, such officer will
be entitled to severance equal to the greater of the remaining base salary due
under the agreement or one year's base salary.
Both Mr. Shea and Mr. Lugo are entitled to receive bonuses in each fiscal
year during the term of their agreements. Such agreements require the Board of
Directors to establish incentive bonus plans for each fiscal year which would
provide a means for each officer to earn a bonus up to 100% of their respective
base salaries upon the achievement of established goals and criteria.
The respective employment agreements grant to each of Mr. Shea and Mr. Lugo
the right to terminate his employment agreement within 90 days following a
"change of control," and to receive an amount equal to the greater of: (i) base
salary due for the remainder of the term of the agreement had it not been
terminated; or (ii) two years base salary. Such change of control severance is
payable 50% in cash on the effective date of such termination, with the balance
payable over a six month period. For the purposes of the employment agreements,
"change of control" is defined as: (i) the acquisition, other than from the
Company directly, by any person, entity or group, within the meaning of Section
13(d) or 14(d) of the Securities Exchange Act of 1934 (the "Exchange Act"), of
beneficial ownership of 25% or more of the outstanding Common Stock; (ii) if the
individuals who serve on the Board as of the date of the employment agreement,
no longer constitute a majority of the members of the Board; provided, however,
any person who becomes a director subsequent to such date, who was elected to
fill a vacancy by a majority of the individuals then serving on the Board, shall
be considered as if a member prior to such date; (iii) approval by a majority of
the voting Stock of the Company of a merger, reorganization or consolidation
whereby the shareholders of the Company immediately prior to such approval do
not, immediately after consummation of such reorganization, merger or
consolidation own more than 50% of the voting Stock of the surviving entity; or
(iv) a liquidation or dissolution of the Company, or the sale of all or
substantially all of the Company's assets.
7
<PAGE> 10
STOCK OPTION PLANS
Employee Plan
The Company's 1994 Employee Stock Option Plan ("Employee Plan") is designed
as an incentive program to cause employees to increase their interest in the
Company's performance and to attract and retain qualified personnel. Subject to
certain anti-dilution provisions, the Employee Plan consists of 666,667 shares
of Common Stock reserved for issuance upon the exercise of options which may be
granted, including 538,311 shares subject to outstanding options.
The Employee Plan is administered by the Compensation and Stock Option
Committee. The Compensation and Stock Option Committee has the discretion, among
other things, as to whom to grant options, the amount of options, the terms of
options and the exercise prices. All employees of the Company are eligible to
receive options under the Employee Plan. Such employees are eligible to receive
either "incentive" or "nonqualified" Stock options, subject to the limitations
of the Internal Revenue Code of 1986, as amended (the "Code"). The exercise
price of an incentive Stock option may not be less than 100% of the market price
of the underlying Common Stock as of the date of grant. No option may be granted
which has a term longer than 10 years. Stock options may have vesting
requirements as established by the Compensation and Stock Option Committee, but,
except in the case of an employee's death or permanent disability, in no event
may the options be exercisable until six months after grant. All vested options
under the Employee Plan become immediately vested in full upon a change of
control of the Company, as such term is defined in the Employee Plan.
Upon termination of an optionee's employment with the Company for any
reason, all options granted to such employee under the Employee Plan would
terminate immediately, except that the Compensation and Stock Option Committee
has the discretion to permit such holder to exercise vested options for a period
of 90 days after termination. Options granted under the Employee Plan may not be
transferred and are not exercisable except by the employee.
The Employee Plan provides for the automatic grant of "reload" options to
an employee, who pays all or a portion of an exercise price by delivery of
shares of Common Stock then owned by such employee. Reload options are granted
for each share of Common Stock so tendered. The exercise price of such reload
option is the then fair market value of the Common Stock. All other terms of the
reload options would be identical to the original options; provided, however,
that if the expiration date is less than one year, the expiration date is
extended to one year from the date of issuance of the reload options.
As of April 23, 1998, options to purchase a total of 538,311 shares of
Common Stock, with a weighted average exercise price of $6.67, have been granted
to executive officers and other employees of the Company. Each option granted
has a term of five years. Options are not exercisable until six months after the
date of grant and vest 25% at the end of six months and 25% on each anniversary
of such grant until 100% are vested.
Directors Plan
The Company has established a Directors Stock Option Plan ("Directors
Plan"). Subject to certain anti-dilution provisions in the Plan, there are
166,667 shares of Common Stock reserved for issuance upon the exercise of
options which may be granted pursuant to the Directors Plan, including 36,524
shares subject to outstanding options. All non-employee directors are eligible
to receive grants of options ("Eligible Directors"). Each Eligible Director
receives automatic, non-discretionary grants of options based upon specific
criteria set forth in the Directors Plan. On April 27 of each year, each
Eligible Director receives non-qualified options to purchase 834 shares of
Common Stock for service on the Board of Directors and additional options to
purchase 334 shares for service on each committee of the Board, other than the
Executive Committee, for which members would receive options to purchase 834
shares. Also, additional options to purchase 334 shares are granted to Eligible
Directors who serve as a chairman of each standing committee of the Board, other
than the chairman of the Executive Committee, who would receive options to
purchase 834 shares.
8
<PAGE> 11
The exercise price of each option granted under the Directors Plan is equal
to the fair market value of the Common Stock on the date of grant as determined
in accordance with the provisions of the Directors Plan. All options granted
have a term of five years, but, except in the case of an Eligible Director's
death or permanent disability, are not exercisable until six months after the
date of grant. No option is transferable by the Eligible Director, except by the
laws of descent and distribution. If the Eligible Director's membership on the
Board terminates, including by reason of death, such options are exercisable for
the lesser of the remaining term of such option, or one year.
The Directors Plan provides for the automatic grant of "reload" options to
an Eligible Director, who pays all, or a portion of, an exercise price by
delivery of shares of Common Stock then owned by such Eligible Director. Reload
options are granted for each share of Common Stock so tendered. The exercise
price of such reload option is the then fair market value of the Common Stock.
All other terms of the reload options, including the expiration date, would be
identical to the original options, provided, however, that if the expiration
date is less than one year, the expiration date is extended to one year from the
date of issuance of the reload options.
As of April 27, 1998, options to purchase 36,524 shares of Common Stock,
with a weighted average exercise price of $6.56 per share, have been
automatically granted to Eligible Directors as a group.
401(k) PLAN
As of January 1997, the Company adopted a tax-qualified employee savings
and retirement plan (the "401(k) Plan") covering the Company's employees.
Pursuant to the 401(k) Plan, eligible employees may elect to contribute to the
401(k) Plan up to the lesser of 15% of their annual compensation or the
statutorily prescribed annual limit ($9,500 in 1997). The Company matches 25% of
the contributions of employees up to 4% of each employee's salary. All employees
who were employed at December 31, 1997 and new hires who thereafter attain at
least one year's service are eligible to participate in the 401(k) Plan.
The Trustees of the 401(k) Plan, at the direction of each participant,
invest the assets of the 401(k) Plan in designated investment options. The
401(k) Plan is intended to qualify under Section 401 of the Code, so that
contributions to the 401(k) Plan, and income earned on the 401(k) Plan
contributions are not taxable until withdrawn. Matching contributions by the
Company are deductible when made.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The following report of the Compensation Committee, and the Stock
Performance Graph included elsewhere in this Proxy Statement do not constitute
soliciting material and should not be deemed filed or incorporated by reference
into any other Company filing under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except to the extent the Company specifically incorporates
this Report in the Stock Performance Graph by reference therein.
COMPENSATION POLICIES APPLICABLE TO EXECUTIVE OFFICERS
The primary policies of the Compensation Committee governing the
compensation of the Company's executive officers is to establish a relationship
between executive pay and the creation of stockholder value, while motivating
and retaining key employees. The Company's compensation program for executives
consists of three key components: base salary; performance based annual cash
bonuses; and periodic grants of stock options. The Company believes that this
approach best serves the interests of the Company and its shareholders. The base
salary enables the Company to meet the requirements of the highly competitive
environment in the Company's industry, while ensuring that executive officers
are compensated in a way that advances both the short and long term interests of
stockholders. Cash bonuses are intended to award both corporate performance, as
measured by financial results and other quantitative measures and individual
performance based on subjective evaluations. Stock options relate a significant
portion of long-term remuneration directly to stock price appreciation realized
by all of the Company's stockholders.
9
<PAGE> 12
Base salaries for the Company's executive officers, as well as changes in
such salaries (other than as required by contracts), are based upon the
recommendation of the Chief Executive Officer, taking into account such factors
as competitive industry salaries; a subjective assessment of the nature of the
position; the contributions and experience of such officer; and the length of
the officers' service with the Company.
Annual cash bonuses are generally based upon corporate performance and each
individual executive officer's accomplishments within the Company as evaluated
by the Chief Executive Officer. The Compensation Committee endeavors to
establish an incentive bonus plan for each fiscal year which sets forth targets
and criteria for the award of cash or other bonuses. The Compensation Committee
awarded cash bonuses to certain of the Company's executive officers based on the
recommendation of the Chief Executive Officer in recognition of their individual
performance and the Company's progress and accomplishments, including the
completion of the Company's initial public offering in 1997. The amount of the
cash bonuses awarded to such executive officers was based upon a subjective
evaluation of the importance of the individual's contribution to the Company's
accomplishments.
Bonuses for the Chief Executive Officer and Chief Financial Officer for
1997 performance were through the issuance of special bonus stock options. The
Committee determined that such a bonus was a more appropriate incentive for such
individuals and in the best interest of the stockholders.
Stock option grants may be made to executive officers upon initial
employment, upon promotion to a new, higher level position that entails
increased responsibility, in connection with the execution of a new employment
agreement or as further incentive to such executive officers. In determining the
number of stock options to be granted, the Compensation Committee reviews the
current option holdings of the executive officers; their positions with the
Company; length of service and subjective criteria on performance and determines
the number of options to be granted based upon the principle of rewarding
performance and providing continuing incentives to contribute to stockholder
value. Using these guidelines, the Chief Executive Officer recommends to the
Compensation Committee the number of options to be granted. Options generally
vest over a three year period.
CHIEF EXECUTIVE OFFICER COMPENSATION
James P. Shea has been the Company's President and Chief Executive Officer
since August 1993. In recognition of his service and commitment to the past and
future success of the Company and to secure his services for the future, the
Company entered into an employment agreement in April 1997 which provided for a
base salary of $190,000 and minimum annual increase. In establishing the base
salary, the Compensation Committee reviewed salaries of the chief executive
officers of comparable companies within its industry, as well other industries,
and Mr. Shea's responsibilities within the Company. Factors taken into
consideration included a subjective evaluation of Mr. Shea's performance,
changes in the cost of living, competitors' size and performance and the
Company's achievements.
Mr. Shea's employment agreement provides for the right to earn annual cash
bonuses of up to 100% of his annual base salary based upon incentive bonus
criteria established by the Compensation Committee in each fiscal year in its
discretion. The Compensation Committee used the same criteria described above
for the determination of Mr. Shea's bonus. No cash bonus was awarded to Mr. Shea
in 1997. In lieu thereof, the Compensation Committee determined to award Mr.
Shea special bonus stock options to enhance his incentive to improve stockholder
value.
Mr. Shea received options to purchase 33,334 shares of common stock in
1997, and options to purchase 16,174 shares of common stock were granted in
February 1998 as a bonus based upon the subjective criteria discussed above,
including the Company's performance in 1997.
EXECUTIVE SEVERANCE PACKAGES
In response to the increase in merger and acquisition activities in recent
years within the industry and to provide the Company's executive officers with
further incentive to remain with the Company, the Compensation Committee granted
executive severance packages to the Company's executive officers, including the
10
<PAGE> 13
Chief Executive Officer, protecting them in the event of change of control of
the Company. The Compensation Committee reviewed executive severance packages
granted by those companies whose compensation practices were examined in
connection with determining executive officer salaries as described above. The
Compensation Committee then determined to grant the executive officers severance
packages in varying amounts depending on their relative position with the
Company. The severance packages for the Chief Executive and Financial Officers
are described in their employment agreements discussed above.
IMPACT OF SECTION 162(m) OF THE INTERNAL REVENUE CODE
Section 162(m) of the Internal Revenue Code generally disallows a tax
deduction to publicly-held corporations for compensation in excess of $1,000,000
paid for any fiscal year to the Company's Chief Executive Officer and the four
(4) other most highly compensated officers. However, the statute exempts
qualifying performance-based compensation from the deduction limit if certain
requirements are met. The policy of the Compensation Committee is to structure
the compensation of the Company's executive officers to avoid the loss of the
deductibility of any compensation, even though Section 162(m) does not preclude
the payment of compensation in excess of $1,000,000. Notwithstanding, the
Compensation Committee reserves the authority to award non-deductible
compensation in circumstances as it deems appropriate. The Company believes that
Section 162(m) will not have any effect on the deductibility of the compensation
of any executive officer for 1997 or 1998.
Respectfully submitted,
Compensation Committee
Eugene P. Conese, Sr., Chairman
John E. Hunt, Sr.
Charles J. Simons
STOCK OWNERSHIP
The following table sets forth certain information as of March 31, 1998,
with respect to the beneficial ownership of the Company's Common Stock by: (i)
each person who is known by the Company to own more than 5% of such shares of
Common Stock; (ii) each Named Executive Officer; (iii) each of the Company's
directors; and (iv) all directors and executive officers as a group.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF SHARES
NAME AND ADDRESS OF BENEFICIAL OWNER(1) BENEFICIALLY OWNED(2) BENEFICIALLY OWNED
- --------------------------------------- --------------------- ------------------
<S> <C> <C>
Arthur G. Shapiro, M.D.(4)................................. 769,759 11.0%
Milton J. Wallace(5)....................................... 744,558 10.7
James P. Shea(6)........................................... 216,688 3.2
C. David Finch, M.D.(7).................................... 195,947 2.8
John E. Hunt, Sr.(8)....................................... 80,987 1.2
Orestes L. Lugo(9)......................................... 60,403 *
Charles J. Simons(10)...................................... 34,187 *
Eugene P. Conese, Sr.(11).................................. 22,334 *
Mark D. Wallace(12)........................................ 15,336 *
Jeffrey H. Watson(13)...................................... 7,002 *
All executive officers and directors as group
(13 persons)(14)......................................... 2,283,666 32.7%
</TABLE>
- ---------------
* Less than one percent.
(1) Unless otherwise indicated, the address for each beneficial owner is c/o the
Company at 2100 Ponce de Leon Boulevard, Suite 950, Coral Gables, Florida
33134.
(2) Except as set forth herein, all securities are directly owned and the sole
investment and voting power are held by the person named. A person is deemed
to be the beneficial owner of securities that can be acquired by such person
within 60 days of March 31, 1998 upon the exercise of options or warrants.
11
<PAGE> 14
(3) Based upon 6,974,247 shares of Common Stock issued and outstanding. Each
beneficial owner's percentage is determined by assuming that all such
exercisable options or warrants that are held by such person (but not those
held by any other person) have been exercised.
(4) Except as set forth herein, all shares of Common Stock are owned jointly by
Dr. Shapiro and his wife. Includes: (i) 17,234 shares of Common Stock owned
by Dr. Shapiro's Individual Retirement Account; (ii) 21,669 shares of
Common Stock issuable upon exercise of Stock options; (iii) 106,122 shares
of Common Stock (including 8,655 shares of Common Stock issuable upon
exercise of warrants and Series B Warrants) owned by a corporation, of
which Dr. Shapiro is an officer and director; and (iv) 3,750 shares of
Common Stock issuable upon exercise of Series B Warrants owned by Dr.
Shapiro's Individual Retirement Account.
(5) Except as set forth herein, all shares of Common Stock are owned jointly by
Mr. Wallace and his wife. Includes: (i) 12,000 shares of Common Stock owned
by Milton J. Wallace and his wife as custodian for a minor child; (ii)
35,600 shares of Common Stock owned by Mr. Wallace's Individual Retirement
Account; (iii) 106,122 shares of Common Stock (including 8,655 of Common
Stock issuable upon exercise of warrants and Series B Warrants) owned by a
corporation, of which Mr. Wallace is an officer, director and controlling
stockholder, (iv) 20,836 shares of Common Stock issuable upon exercise of
Stock options; and (v) 15,000 shares of Common Stock issuable upon exercise
of Series B Warrants owned by his Individual Retirement Account.
(6) Except as set forth herein all shares are owned jointly by Mr. Shea and his
wife. Includes: (i) 32,087 shares of Common Stock issuable upon exercise of
Stock options; (ii) 33,334 shares of Common Stock issuable upon exercise of
warrants; and (iii) 15,000 shares of Common Stock issuable upon exercise of
Series B Warrants.
(7) Includes 3,750 shares of Common Stock issuable upon exercise of Stock
options.
(8) Includes: (i) 3,669 shares of Common Stock issuable upon exercise of Stock
options; (ii) 6,667 shares of Common Stock issuable upon exercise of
warrants; (iii) 11,667 shares of Common Stock owned by Mr. Hunt's spouse;
(iv) 1,667 shares of Common Stock issuable upon exercise of warrants owned
by his spouse; and (v) 3,750 shares of Common Stock issuable upon exercise
of Series B Warrants. Mr. Hunt disclaims beneficial ownership of the shares
owned by his spouse.
(9) Includes: (i) 18,752 shares of Common Stock issuable upon exercise of Stock
options; (ii) 3,334 shares of Common Stock issuable upon exercise of
warrants; and (iii) 3,750 shares of Common Stock issuable upon exercise of
Series B Warrants.
(10) Includes: (i) 5,002 shares of Common Stock issuable upon exercise of Stock
options; (ii) 1,667 shares of Common Stock issuable upon exercise of
warrants; and (iii) 7,500 shares of Common Stock issuable upon exercise of
Series B Warrants.
(11) Includes: (i) 2,334 shares of Common Stock issuable upon exercise of Stock
options; and (ii) 5,000 shares of Common Stock issuable upon exercise of
warrants.
(12) Includes 3,336 shares of Common Stock issuable upon exercise of Stock
options.
(13) Includes 4,002 shares of Common Stock issuable upon exercise of Stock
options.
(14) Includes: (i) 148,357 shares of Common Stock issuable upon exercise of
options; (ii) 58,336 shares of Common Stock issuable upon exercise of
warrants; and (iii) 54,488 shares of Common Stock issuable upon exercise of
Series B Warrants.
12
<PAGE> 15
PROPOSAL TO AMEND THE EMPLOYEE STOCK OPTION PLAN
On April 22, 1998, the Board of Directors, based on the recommendation of
its Compensation and Stock Option Committee, adopted an amendment (the "Employee
Plan Amendment") to the Company's 1994 Employee Stock Option Plan (the "Employee
Plan"). The Employee Plan Amendment must be approved by holders of a majority of
the Company's outstanding shares of Common Stock present at the Annual Meeting.
The Employee Plan Amendment increases from 666,667 to 1,000,000, the
authorized shares of Common Stock reserved under the Employee Plan. As of April
22, 1998, options to purchase 538,311 shares of Common Stock were outstanding
under the Employee Plan. The increase in the number of reserved shares will
allow the Company to grant additional options pursuant to the Employee Plan. The
Compensation and Stock Option Committee believes that there is a continuing
need, and that it is in the best interests of the Company and its stockholders,
to make stock related awards to officers and other employees so that the Company
will be able to attract and retain highly qualified individuals.
All other terms and conditions of the Employee Plan will remain the same. A
summary of the terms and conditions of the Employee Plan is set forth in the
Proxy Statement under the caption -- "COMPENSATION -- Employee Stock Option
Plans."
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE
"FOR" THE AMENDMENT TO THE EMPLOYEE PLAN.
The adoption of the Employee Plan Amendment requires the affirmative vote
of not less than a majority of the outstanding shares of Common Stock
represented at the Annual Meeting. The Employee Plan Amendment would be
effective immediately upon approval by the Stockholders. The effect of an
abstention or a broker non-vote is the same as a vote against the proposal.
CERTAIN TRANSACTIONS
JCD Partnership, a real estate holding and property management firm, of
which C. David Finch, M.D., Jeffery Finch and Charles D. Finch, Sr. are the
principals, owns the real property and improvements at the Company's dialysis
facilities at Jackson, Mississippi and Delta, Louisiana. JCD Partnership leases
the properties to the Company pursuant to ten year leases, in which the Company
pays annual rent of $92,400 and $82,500, respectively. The Company paid $427,000
and $175,000 to JCD Partnership in connection with the leasehold improvements at
each facility.
C. David Finch, M.D. owed DFI approximately $85,000 at the time of the
Company's acquisition of Dialysis Facilities, Inc. ("DFI") in December 1995.
DFI's acquisition by the Company evidenced by a note. Dr. Finch is obligated to
repay the Company over a three-year period with interest at the rate of 8% per
annum. Such repayments may come from any bonuses Dr. Finch may earn in
connection with his employment as a medical director with the Company. The
balance of the note, if not then paid, will be payable upon demand by the
Company at the end of three years. As of December 31, 1996 and 1997,
approximately $85,000 in principal remained unpaid, together with accrued
interest of $6,800 and $13,600 as of such dates, respectively.
Milton J. Wallace, Chairman of the Board of Directors of the Company, is a
shareholder of the law firm of Wallace, Bauman, Fodiman & Shannon, P.A. The law
firm serves as general counsel to the Company for which the firm received
$260,000 during 1997.
John E. Hunt, Sr., a Director of the Company, is Chairman of the Board of
Directors of Hunt Insurance Group, Inc., an insurance agency. Hunt Insurance
Group, Inc. arranges for various types of insurance policies for the Company and
receives commissions as a result of such policies.
13
<PAGE> 16
STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total stockholder return of the
Company's Common Stock from October 8, 1997 (the date that trading of the Common
Stock commenced on the NASDAQ National Market System) to December 31, 1997 with
(a) the Standard and Poors 500 Stock Index; and (b) a Peer Group Index. The
graph assumes that $100 was invested on October 8, 1997 in the Company's Common
Stock, the S&P 500 Index and the Peer Group Index and that all dividends were
reinvested. The Peer Group Index in the graph includes the Common Stock of Renal
Care Group, Inc., Renal Treatment Centers, Inc. and Total Renal Care Holdings,
Inc., which the Company believes are the most comparable to the Company's
operations within the dialysis industry.
COMPARISON OF CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
MEASUREMENT PERIOD STANDARD & POORS
(FISCAL YEAR COVERED) RENEX CORPORATION 500 PEER GROUP INDEX
<S> <C> <C> <C>
OCT 97 100.00 100.00 100.00
DEC. 31, 1997 65.63 102.87 93.73
</TABLE>
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The firm of Deloitte & Touche, LLP served as the Company's independent
auditors for the years ended December 31, 1996 and 1997. Although the Board of
Directors has not yet selected a firm to serve as auditors for the year ended
December 31, 1998, it is expected that Deloitte & Touche, LLP will be retained
by the Company for such audit. Representatives of Deloitte & Touche, LLP are
expected to be present at the Annual Meeting and will be afforded the
opportunity to make a statement, if they desire, and to respond to appropriate
questions.
14
<PAGE> 17
OTHER MATTERS
Management is not aware of any other matters which may come before the
Annual Meeting and which require the vote of stockholders in addition to those
matters indicated in the notice of meeting and this Proxy Statement. The
Company's By-Laws contain provisions relating to notices of stockholder meetings
which prohibit a stockholder from nominating a person for the Board of Directors
or proposing certain acts relating to the Company's business without advance
written notice to the Company. Such written notice must be given at least sixty
(60) days, but not more than ninety (90) days prior to the anniversary date of
the immediately preceding annual meeting of stockholders and must contain
specific information about the nominee and the stockholder who makes such
nomination or proposal. No nomination proposal was received by the Company for
the Annual Meeting. If any other matter calling for stockholder action should
properly come before the Annual Meeting or any adjournment thereof, those
persons named as proxies in the enclosed proxy will vote in accordance with
their best judgment.
STOCKHOLDER PROPOSALS
Stockholders who wish a proposal to be included in the Company's proxy
statement and form of proxy relating to the 1998 annual meeting must be received
by the Company by no earlier than March 20, 1999 and not later than April 20,
1999 for inclusion on the Company's proxy statement related to that meeting.
Such notice must include (i) a brief description of the business desired to be
brought before the annual meeting and the reasons for conducting such business
at the annual meeting, (ii) the name and record address of such stockholder,
(iii) the number of shares of common stock of the Company which are owned
beneficially of record by such stockholder, (iv) a description of all
arrangements or understandings between such stockholder and any other person or
persons (including their names) in connection with the proposal of such business
by such stockholder and any material interest of such stockholder in such
business and (v) a representation that such stockholder intends to appear in
person or by proxy at the Annual Meeting to bring valid business before the
meeting.
ANNUAL REPORT
A copy of the Company's 1997 Annual Report, including audited financial
statements as of December 31, 1997 and 1996 and for each of the two (2) years
then ended are being mailed to all stockholders. Copies of the Annual Report on
Form 10-KSB as filed with the Securities and Exchange Commission may be obtained
by writing to James P. Shea, President/Chief Executive Officer, 2100 Ponce de
Leon Boulevard, Suite 950, Coral Gables, Florida 33134.
COSTS OF SOLICITATION
All expenses in connection with this solicitation will be borne by the
Company. In addition to solicitation by mail, proxies may be solicited by
directors, officers and other employees of the Company by telephone, telefax, in
person or otherwise, without additional compensation. The Company will also
request brokerage firms, nominees, custodians and fiduciaries to forward proxy
materials to the beneficial owners of shares held of record by such persons and
will reimburse such persons and the Company's transfer agent for their
reasonable out-of-pocket expenses in forwarding such materials. The Company
further reserves the right to retain the services of a proxy solicitation form
to solicit proxies and will pay all reasonable costs associated therewith.
15
<PAGE> 18
Appendix A
RENEX CORP.
PROXY
THIS PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 30, 1998
The undersigned hereby appoints James P. Shea and Arthur G. Shapiro, or
either of them, as proxies, with full individual power of substitution to
represent the undersigned and to vote all shares of Common Stock of the Company
which the undersigned is entitled to vote at the Annual Meeting of Stockholders
of the Company to be held at the Hyatt Regency Hotel, 50 Alhambra Plaza, Coral
Gables, Florida on June 30, 1998 at 10:00 A.M., and any and all adjournments
thereof, in the manner specified below:
1. ELECTION OF CLASS II DIRECTOR
NOMINEES:
<TABLE>
<S> <C> <C>
John E. Hunt, Sr.
James P. Shea
Mark D. Wallace
[ ] FOR all nominees listed above
[ ] WITHHOLD AUTHORITY to vote for the following nominees:
------------------------------------------------------------------
[ ] WITHHOLD AUTHORITY to vote for all nominees
</TABLE>
2. PROPOSAL TO AMEND THE COMPANY'S 1994 EMPLOYEE STOCK OPTION PLAN.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(continued on other side)
(continued from other side)
THIS PROXY, WHEN PROPERLY EXECUTED, SHALL BE VOTED AS DIRECTED. IF NO
DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR EACH PROPOSAL. Should any
other matter requiring a vote of the stockholders arise, the persons named in
the Proxy or their substitutes shall vote in accordance with their best judgment
in the interest of the Company. The Board of Directors are not aware of any
matter which is to be presented for action at the meeting other than the matters
set forth herein.
Dated: , 1998
------------------------
------------------------------
Signature
------------------------------
Signature
Please sign the Proxy exactly
as name appears. When shares
are held by joint tenants,
both should sign. Executors,
administrators, trustees or
otherwise signing in a
representative capacity should
indicate the capacity in which
signed.
PLEASE VOTE, SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
