SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material under Rule 14a-12
PEDIATRIX MEDICAL GROUP, INC.
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(Name of Registrant as Specified In Its Charter)
PEDIATRIX MEDICAL GROUP, INC.
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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(PEDIATRIX LOGO)
MEDICAL GROUP, INC.
1301 CONCORD TERRACE
SUNRISE, FLORIDA 33323-2825
(954) 384-0175
April 15, 2002
Dear Pediatrix Shareholder:
PROXY STATEMENT FOR PEDIATRIX'S 2002 ANNUAL MEETING OF SHAREHOLDERS
You are cordially invited to attend the 2002 annual shareholders' meeting
of Pediatrix Medical Group, Inc., on Tuesday, May 14, 2002, beginning at 1:00
p.m., local time, at the Crowne Plaza Hotel, 13400 West Sunrise Boulevard,
Sunrise, Florida 33323.
At the 2002 annual meeting, we will ask you to vote on a number of
important matters. Please vote on all the matters described in our proxy
statement. Your board of directors recommends a vote "FOR" each of the first two
proposals listed in the notice on the next page and described in this proxy
statement.
Whether or not you plan to attend in person, it is important that your
shares be represented and voted at the annual meeting. After reading our proxy
statement, please submit your proxy by using the enclosed proxy card. If you
choose to vote this year by proxy card, please mark, sign, date and promptly
return the card in the self-addressed stamped envelope provided. Returning a
proxy does not deprive you of your right to attend the annual meeting and vote
your shares in person.
All shareholders of record on April 2, 2002, are invited and encouraged to
attend the annual meeting. This proxy statement is first being mailed to
Pediatrix's shareholders on or about April 15, 2002.
We appreciate your continued support of our company.
Sincerely,
/s/ Roger J. Medel
Roger J. Medel, M.D.
Chairman of the Board
and Chief Executive Officer
PEDIATRIX MEDICAL GROUP, INC.
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NOTICE OF 2002 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 14, 2002
---------------------
To the Shareholders of
Pediatrix Medical Group, Inc.
NOTICE IS HEREBY GIVEN that the 2002 annual shareholders' meeting of
Pediatrix Medical Group, Inc., a Florida corporation ("Pediatrix"), will be held
at 1:00 p.m., local time, on May 14, 2002, at the Crowne Plaza Hotel, 13400 West
Sunrise Boulevard, Sunrise, Florida 33323, for the following purposes, as more
fully described in this proxy statement:
- to elect Pediatrix's entire board of directors;
- to approve amendments to Pediatrix's employee stock purchase plans to
reduce the maximum number of shares issuable under the qualified stock
purchase plan by 250,000 shares and to increase the maximum number of
shares issuable under the non-qualified stock purchase plan by an equal
amount; and
- to consider and act upon any other business properly brought before the
annual meeting.
The board of directors of Pediatrix has fixed the close of business on
April 2, 2002 as the record date for determining those shareholders entitled to
notice of, to attend and to vote at the annual meeting, and any postponement or
adjournment thereof.
This is an important meeting. All shareholders are invited and encouraged
to attend the meeting in person. Whether or not you plan to attend, please mark,
sign, date and promptly return the enclosed proxy card. Shareholders who return
proxy cards prior to the meeting may nevertheless attend the meeting, revoke
their proxies and vote their shares in person.
By Order of the Board of Directors,
/s/ Brian T. Gillon
Brian T. Gillon
Executive Vice President -- Corporate Development,
General Counsel and Secretary
Sunrise, Florida
April 15, 2002
2002 ANNUAL MEETING OF SHAREHOLDERS
OF
PEDIATRIX MEDICAL GROUP, INC.
---------------------
We are furnishing this proxy statement to Pediatrix's shareholders as part
of the solicitation of proxies by Pediatrix's board of directors for use at
Pediatrix's 2002 annual shareholders' meeting, and at any meeting following
postponement or adjournment thereof.
DATE, TIME AND PLACE OF ANNUAL MEETING
Pediatrix's 2002 annual shareholders' meeting will be held on Tuesday, May
14, 2002, at 1:00 p.m., local time, at the Crowne Plaza Hotel, 13400 West
Sunrise Boulevard, Sunrise, Florida 33323.
PURPOSE OF THE ANNUAL MEETING
At the annual meeting, Pediatrix's shareholders will be asked:
- to elect Pediatrix's entire board of directors;
- to approve amendments to Pediatrix's employee stock purchase plans to
reduce the maximum number of shares issuable under the qualified stock
purchase plan by 250,000 shares and to increase the maximum number of
shares issuable under the non-qualified stock purchase plan by an equal
amount; and
- to consider and act upon any other business properly brought before the
annual meeting.
PEDIATRIX RECORD DATE; SHARES ENTITLED TO VOTE
Only holders of record of Pediatrix common stock at the close of business
on April 2, 2002, the record date, are entitled to notice of, to attend and to
vote at the annual meeting. Pediatrix's shareholders will have one vote at the
annual meeting for each share of Pediatrix common stock owned on the record
date.
At the close of business on the record date, 25,513,661 shares of Pediatrix
common stock were issued and outstanding, which were held by approximately 126
holders of record. The closing sale price of Pediatrix common stock as reported
on the New York Stock Exchange on the record date was $41.50 per share.
QUORUM; ABSTENTIONS
A quorum will be present at the annual meeting if holders of a majority of
the issued and outstanding shares of Pediatrix common stock on the record date
are represented in person or by proxy at the annual meeting. If a quorum is not
present at the annual meeting, Pediatrix expects to postpone or adjourn the
meeting to solicit additional proxies.
Abstentions, including broker non-votes, will be counted as shares present
and entitled to vote for the purposes of determining the presence or absence of
a quorum, but will not be counted for the purposes of determining the number of
shares represented and voting with respect to a proposal.
VOTES REQUIRED
Assuming that a quorum is present at the annual meeting, director nominees
receiving the greatest number of affirmative votes from holders of Pediatrix
common stock will be elected as directors of Pediatrix and the affirmative vote
of a majority of the shares represented and voting at the annual meeting,
provided that the total number of votes cast in such proposal represents a
majority of the issued and outstanding shares of Pediatrix common stock entitled
to vote thereon, is required to approve the amendments to Pediatrix's employee
stock purchase plans as described in this proxy statement.
VOTING BY PEDIATRIX'S DIRECTORS AND EXECUTIVE OFFICERS
Each Pediatrix director and executive officer has indicated a present
intention to vote, or cause to be voted, the Pediatrix common stock owned by
such director or officer as follows:
- "FOR" the election of each of the nominees for director named in this
proxy statement; and
- "FOR" the approval of the amendments to the employee stock purchase plans
as described in this proxy statement.
VOTING OF PROXIES; BROKER NON-VOTES
Shareholders may vote without attending the meeting by submitting a proxy.
All shares of Pediatrix common stock represented by properly executed proxies
received in time for the annual meeting will be voted at the annual meeting in
the manner specified by the holders of those shares. Proxies that are properly
executed by the record holder but otherwise do not contain voting instructions
will be voted as follows:
- "FOR" the election of each of the nominees for director named in this
proxy statement;
- "FOR" the approval of the amendments to the employee stock purchase plans
as described in this proxy statement; and
- in accordance with the recommendation of Pediatrix's board of directors,
"FOR" or "AGAINST" all other matters that may properly come before the
annual meeting.
Shareholders whose shares are registered in the name of a bank or brokerage
firm may be eligible to vote electronically through the Internet or by
telephone. Banks and brokerage firms that hold shares of Pediatrix common stock
in street name for customers who are the beneficial owners of such shares may
not give a proxy to vote those customers' shares in the absence of specific
instructions from those customers, except in the case of the election of
directors. These non-voted shares are referred to as broker non-votes and will
be voted as abstentions.
REVOCABILITY OF PROXIES
The grant of a proxy on the enclosed proxy card does not preclude a
shareholder from voting in person at the annual meeting. A shareholder may
revoke a proxy at any time prior to its exercise by filing with Pediatrix's
corporate secretary a duly executed revocation of proxy, by submitting a duly
executed proxy to Pediatrix's corporate secretary bearing a later date or by
appearing at the annual meeting and voting in person. Attendance at the annual
meeting will not itself constitute revocation of a proxy.
SOLICITATION OF PROXIES
Pediatrix will bear the cost of the solicitation of proxies from its
shareholders. In addition to solicitations by mail, Pediatrix's directors,
officers and employees, and those of its subsidiaries and affiliates, may
solicit proxies from shareholders by telephone or other electronic means or in
person. Pediatrix will cause banks and brokerage firms and other custodians,
nominees and fiduciaries to forward solicitation materials to the beneficial
owners of Pediatrix common stock held of record by such custodians, nominees and
fiduciaries. Pediatrix will reimburse such banks, brokerage firms, custodians,
nominees and fiduciaries for their reasonable out-of-pocket expenses in doing
so.
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ELECTION OF PEDIATRIX'S DIRECTORS
Pediatrix's articles of incorporation and bylaws, each as amended and
restated, provide that the number of directors constituting Pediatrix's board of
directors will be determined from time to time by resolution adopted by
Pediatrix's board of directors. Pediatrix's board of directors resolved that the
board of directors would have nine members in the upcoming year.
Eight of Pediatrix's nine incumbent directors have been nominated by
Pediatrix's board of directors as directors to be elected at the annual meeting
by the holders of Pediatrix common stock. In addition, Dr. Roger K. Freeman has
been nominated by Pediatrix's board of directors as a director to be elected at
the annual meeting.
Roger K. Freeman, M.D., 66, is a maternal-fetal medicine physician who, in
1995, founded Perinatal Associates of Southern California, a physician practice
group affiliated with Pediatrix since the acquisition of Magella. Dr. Freeman is
a graduate of the University of California at San Francisco. He completed his
residency in Obstetrics/Gynecology at Harbor General Hospital, and is Board
certified in Obstetrics/ Gynecology and Maternal-Fetal Medicine. Dr. Freeman has
served on many national and local OB/GYN and perinatal organizations. In
September 1999, Dr. Freeman retired from private practice. He is currently a
director of the OB/GYN Newborn CareLine at Long Beach Memorial Women's Hospital
and serves on the Board of Directors of Long Beach Memorial Medical Center. Dr.
Freeman has authored numerous articles and three books.
Proxies will be voted "FOR" all such nominees absent contrary instructions.
Dr. Medel has served as a director since 1979. Mr. Fernandez has served as a
director since October 1995. Dr. Cunningham has served as a director since
October 1996. Mr. Alvarez has served as a director since March 1997. Dr. Carlo
has served as a director since June 1999. Messrs. Bratberg, Carlyle and Dr.
Ratner have served as directors since May 2001. See below under "Management" for
the biographies of these nominees for director. Mr. Mackesy has declined to
stand for re-election and, effective May 15, 2002, will no longer serve as a
member of Pediatrix's board of directors.
Each director elected will serve for a term expiring at Pediatrix's 2003
annual meeting of shareholders, which is expected to be held in May 2003, or
until his successor has been duly elected and qualified.
Pediatrix's board of directors has no reason to believe that any nominee
will refuse to act or be unable to accept election; however, in the event that a
nominee for a directorship is unable to accept election or if any other
unforeseen contingencies should arise, proxies will be voted for the remaining
nominees and for such other person as may be designated by Pediatrix's board of
directors, unless the proxies provide otherwise.
VOTE REQUIRED AND RECOMMENDATION
If a quorum is present and voting at the annual meeting, the nine nominees
receiving the highest number of votes "FOR" election will be elected to the
board of directors of Pediatrix.
PEDIATRIX'S BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH
OF THE NINE NOMINEES FOR DIRECTOR.
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MANAGEMENT
EXECUTIVE OFFICERS AND DIRECTORS
Pediatrix's executive officers and directors are as follows:
NAME AGE POSITION WITH PEDIATRIX
---- --- ---------------------------------------
Roger J. Medel, M.D.................... 55 Chief Executive Officer and
Director
Kristen Bratberg....................... 40 President and Director
Joseph M. Calabro...................... 41 Chief Operating Officer
Brian T. Gillon........................ 35 Executive Vice President -- Corporate
Development, General Counsel and
Secretary
Karl B. Wagner......................... 36 Chief Financial Officer and Treasurer
Cesar L. Alvarez(1)(2)................. 54 Director
Waldemar A. Carlo, M.D.(1)(2).......... 49 Director
John K. Carlyle........................ 47 Director
M. Douglas Cunningham, M.D............. 62 Vice President, Special Projects and
Director
Michael B. Fernandez(1)(2)............. 49 Director
Ian M. Ratner, M.D..................... 50 Director
---------------
(1) Member of compensation committee.
(2) Member of audit committee.
Roger J. Medel, M.D. has held the positions of Chief Executive Officer and
director of Pediatrix since he founded Pediatrix in 1979 with Dr. Gregory
Melnick. Prior to May 2000, Dr. Medel was also President of Pediatrix. Dr. Medel
has been an instructor in pediatrics at the University of Miami and participates
as a member of several medical and professional organizations. Dr. Medel also
holds a Masters Degree in Business Administration from the University of Miami.
Dr. Medel served on the boards of directors of Sechrist Industries Inc. and ARC
Broward Inc., and currently serves on the board of directors of Physicians
Healthcare Plans, Inc.
Kristen Bratberg joined Pediatrix in November 1995 as Vice President,
Business Development. In January 2000 Mr. Bratberg was appointed Executive Vice
President, Corporate Development and in May 2000 he was appointed President. Mr.
Bratberg has been a director of Pediatrix since May 2001. Prior to joining
Pediatrix, Mr. Bratberg was employed by Dean Witter Reynolds Inc. in the
Corporate Finance Department from May 1987 to November 1995, most recently as a
Senior Vice President specializing in the healthcare industry.
Joseph M. Calabro joined Pediatrix in January 1996 as Chief Information
Officer. In January 2000 Mr. Calabro was appointed Executive Vice President,
Management and in May 2000, he was appointed Chief Operating Officer. Prior to
joining Pediatrix, Mr. Calabro was employed by Ambulatory Surgery Group of
Columbia/HCA as Director of Information Technology from 1994 to January 1996 and
in various other operational and technology roles from 1987 to 1994.
Brian T. Gillon joined Pediatrix in December 1996 as Director, Business
Development, served as Vice President, Business Development from January 2000
through December 2000 and was appointed Executive Vice President -- Corporate
Development, General Counsel and Secretary in January 2001. In his current
position, Mr. Gillon is responsible for Pediatrix's legal affairs and activities
related to new business opportunities, including mergers and acquisitions. From
June 1996 until joining Pediatrix, Mr. Gillon was an associate in the healthcare
group of Smith Barney, Inc.'s Investment Banking Division, and from Septem-
4
ber 1993 until June 1996 Mr. Gillon was an attorney at Dewey Ballantine,
specializing in mergers and acquisitions and corporate finance transactions for
health care companies.
Karl B. Wagner joined Pediatrix in May 1997 and was appointed Chief
Financial Officer in August 1998. Prior to his appointment, Mr. Wagner served as
Controller, and was responsible for all accounting and financial operations,
including SEC reporting. Prior to joining Pediatrix, Mr. Wagner was Chief
Financial Officer for the East Region of Columbia/HCA's Ambulatory Surgery
Division from January 1995 until 1997. From July 1993 through January 1995, Mr.
Wagner was Assistant Controller of Medical Care International, Inc., a
subsidiary of Medical Care America, Inc.
Cesar L. Alvarez was appointed as a director in March 1997. Mr. Alvarez has
served since 1997 as the President and Chief Executive Officer of the law firm
of Greenberg Traurig, L.L.P. Mr. Alvarez also serves as a director of Atlantis
Plastics, Inc., Texpack, N.V., Watsco, Inc. and The Knight Foundation.
Waldemar A. Carlo, M.D. was appointed as a director in June 1999. Dr. Carlo
has served as Professor of Pediatrics and Director of the Division of
Neonatology at the University of Alabama at Birmingham Medical School since
1991. Dr. Carlo has also served as Director of Newborn Nurseries at the
University of Alabama Medical Center and the Children's Hospital of Alabama
since 1991. Dr. Carlo participates as a member of several medical and
professional organizations. He has also received numerous research awards and
grants and has lectured extensively, both nationally and internationally.
John K. Carlyle was appointed by the board of directors as a director in
May 2001. Mr. Carlyle served as Chief Executive Officer of Magella Healthcare
Corporation from 1998 through May 2001. From 1990 through 1997 he served as
President, Chief Executive Officer and Chairman of Concentra Managed Care, Inc.
(formerly OccuSystems, Inc.), a healthcare services and cost containment company
in the area of workers' compensation and occupational health care. From 1985
through 1990, Mr. Carlyle served as Senior Vice President and Chief Financial
Officer of Medical Care International, the nation's largest operator of
outpatient surgery centers. He currently serves on the board of directors of
Odyssey Healthcare, Inc., Concentra, Inc., and Heritage Healthcare System, Inc.
Mr. Carlyle is a certified public accountant.
M. Douglas Cunningham, M.D. has been employed by Pediatrix since June 1996.
Dr. Cunningham served as Chief Medical Officer from June 1996 to June 1997, at
which time he was appointed Vice President, Regional Medical Operations. In
August 1999, Dr. Cunningham was appointed Vice President, Medical Coding. Dr.
Cunningham served as Regional Vice President of Medical Operations in 2001. He
currently serves as Vice President, Special Projects. Dr. Cunningham was
appointed director of Pediatrix in October 1996. Dr. Cunningham has over 25
years experience as a practicing neonatologist and professor of pediatrics and
neonatology. From 1988 until joining Pediatrix, Dr. Cunningham served as the
Senior Vice President, Medical Operations with Infant Care Management Services,
Inc. Dr. Cunningham has also served as Professor of Pediatrics, University of
Kentucky, and as Clinical Professor of Pediatrics at the University of
California, Irvine.
Michael B. Fernandez was appointed as a director in October 1995. Mr.
Fernandez has served since 1992 as Chairman of the Board and Chief Executive
Officer of Physicians Healthcare Plans, Inc., a Florida-based health maintenance
organization. Prior to that time, Mr. Fernandez served from 1990 to 1992 as
Executive Vice President of Product Development and Marketing as well as Chief
Executive Officer of certain indemnity subsidiaries of CAC-United Healthcare
Plans of Florida, Inc., a publicly-held managed care company.
Ian M. Ratner, M.D. was appointed by the board of directors as a director
in May 2001. He served as Chairman of the Board and Chief Medical Officer of
Magella Healthcare Corporation from 1998 through May 2001. From 1996 through
1998 Dr. Ratner served as neonatologist with Newborn and Pediatric Healthcare
Associates, P.A., the predecessor to Magella. Dr. Ratner is a neonatologist in
the Dallas, Texas area and is past Co-Chairman of the Committee on Practice:
Neonatal-Perinatal Medicine; Section of Perinatal Pediatrics; American Academy
of Pediatrics. Dr. Ratner is a graduate from Dartmouth Medical School and
completed his residency at the University of Colorado Medical Center. He
completed his neonatal
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fellowship at The Children's Hospital in Denver, Colorado. Dr. Ratner is board
certified in pediatrics and neonatal-perinatal medicine and is past President of
Newborn and Pediatric Healthcare Associates, P.A.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
Pursuant to the Florida Business Corporation Act and Pediatrix's amended
and restated bylaws, Pediatrix's business, property and affairs are managed
under the direction of the board of directors. Members of the board of directors
are kept informed of Pediatrix's business through discussions with Pediatrix's
officers, by reviewing materials provided to them and by participating in
meetings of the board of directors and its committees.
During 2001, Pediatrix's board of directors held eight meetings and took
various actions by unanimous written consent. Pediatrix's board of directors had
two ongoing committees during 2001, the audit committee and the compensation
committee. The audit committee held two stand-alone meetings and participated in
various meetings held by the full board of directors in 2001. Messrs. Fernandez
and Alvarez, and Dr. Carlo were members of Pediatrix's audit committee during
2001. Pediatrix's compensation committee held two meetings in 2001. Messrs.
Fernandez and Alvarez and Dr. Carlo were also members of Pediatrix's
compensation committee during 2001. Mr. Alvarez acted as Chair of both the
compensation and audit committees. Each director attended at least 75 percent of
the total number of meetings of Pediatrix's board of directors and its
committees held during 2001. Pediatrix does not currently have a nominating
committee.
FEES PAID TO INDEPENDENT ACCOUNTANTS
The Securities and Exchange Commission's Final Rule on Auditor Independence
requires that Pediatrix make the following disclosures regarding the amount of
fees billed by its independent auditors and the nature of the work for which
these fees were billed:
AUDIT FEES
Aggregate fees billed for PricewaterhouseCoopers LLP's ("PWC") audit of
Pediatrix's annual financial statements for the year ended December 31, 2001 and
for its reviews of the financial statements included in each of Pediatrix's
Forms 10-Q for the year ended December 31, 2001, totaled $203,000. Of this
amount, $113,000 had been billed as of December 31, 2001.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
There were no fees billed for any financial information systems design and
implementation services rendered by PWC for the year ended December 31, 2001.
ALL OTHER FEES
Aggregate fees billed for all other services rendered by PWC for the year
ended December 31, 2001, totaled $121,900.
REPORT OF THE AUDIT COMMITTEE
Pediatrix's audit committee consists of three independent directors. The
audit committee's duties and responsibilities are set forth in a written charter
adopted by Pediatrix's board of directors. The audit committee has:
- Reviewed and discussed with management Pediatrix's audited financial
statements as of and for the fiscal year ended December 31, 2001;
- Discussed with Pediatrix's independent public accountants, PWC, the
matters required to be discussed by Statement on Auditing Standards No.
61, Codification of Statements on Accounting Standards, as amended; and
6
- Received and reviewed the written disclosures and the letter from
the independent auditors required by Independence Standards Board
Standard No. 1, Independence Discussions with Audit Committees,as
amended, and has discussed with the independent auditors their
independence.
Based on the reviews and discussions referred to above, the audit committee
recommended to the board of directors that the financial statements referred to
above be included in Pediatrix's Annual Report on Form 10-K for the fiscal year
ended December 31, 2001.
The audit committee has determined that the provision of all non-audit
services performed for Pediatrix by PWC is compatible with maintaining that
firm's independence.
Cesar L. Alvarez
Michael B. Fernandez
Waldemar Carlo, M.D.
DIRECTOR COMPENSATION
Pediatrix pays each director who is neither an employee nor associated with
one of Pediatrix's principal shareholders (1) an annual director's fee of
$20,000, payable quarterly, (2) a $1,250 fee for each meeting of the board of
directors attended by such director, (3) an annual retainer of either $2,500 for
each committee on which the director serves as a member, or $5,000 for each
committee on which the director serves as Chair, (4) a $500 fee for each
committee meeting attended that is not held in conjunction with a regular
meeting of the board of directors, and (5) 3,000 options granted at each annual
shareholders' meeting, at market price and vesting ratably over a three year
period. In addition, each such non-employee director receives on such director's
initial appointment to the board of directors, options to purchase 5,000 shares
of Pediatrix common stock. These options become fully exercisable on the
one-year anniversary date of the grant, with the unexercised portion becoming
null and void three months after such non-employee director ceases to be a
director of Pediatrix for any reason. Pediatrix also reimburses all of its
directors for out-of-pocket expenses incurred in connection with the rendering
of services as a director.
Dr. Medel also serves as Chief Executive Officer pursuant to an employment
agreement with Pediatrix which provides for an annual salary of $600,000. Mr.
Bratberg also serves as President pursuant to an employment agreement with
Pediatrix which provides for an annual salary of $400,000. Dr. Cunningham also
serves as Vice President, Special Projects pursuant to an employment agreement
with Pediatrix which provides for an annual salary of $400,000. Dr. Ratner also
provides medical services as a neonatologist pursuant to an employment agreement
with Magella Medical Associates, P.A., an affiliate of Pediatrix, which provides
for an annual salary of $300,000.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Fernandez, a member of Pediatrix's compensation committee, is also a
director and chief executive officer of Physicians Healthcare Plans, Inc. Dr.
Medel serves on the board of directors of Physicians Healthcare Plans, Inc.
7
SHARE OWNERSHIP OF PEDIATRIX
The following table sets forth information concerning the beneficial
ownership of common stock of Pediatrix as of March 20, 2002 for the following:
- Each shareholder who is known by Pediatrix to own beneficially more than
five percent of the outstanding Pediatrix common stock;
- Each of Pediatrix's current directors and nominees for director;
- Pediatrix's chief executive officer and its other four most highly
compensated officers during 2001; and
- All Pediatrix's directors and executive officers as a group.
COMMON STOCK
BENEFICIALLY OWNED(2)
---------------------
NAME OF BENEFICIAL OWNER(1) SHARES PERCENT
--------------------------- ---------- --------
Roger J. Medel, M.D.(3)..................................... 1,876,875 7.37%
Kristen Bratberg(4)......................................... 440,540 1.73%
Joseph M. Calabro(5)........................................ 145,311 *
Brian T. Gillon(6).......................................... 121,579 *
Karl B. Wagner(7)........................................... 81,422 *
Cesar L. Alvarez(8)......................................... 14,000 *
Waldemar A. Carlo, M.D.(9).................................. 9,000 *
John K. Carlyle(10)......................................... 55,000 *
M. Douglas Cunningham, M.D.(11)............................. 12,800 *
Michael B. Fernandez(12).................................... 47,731 *
Roger K. Freeman, M.D.(13).................................. 400 *
D. Scott Mackesy(14)........................................ 4,119 *
Ian M. Ratner(15)........................................... 59,532 *
Wasatch Advisors, Inc.(16).................................. 3,556,566 13.96%
Welsh, Carson, Anderson & Stowe VII, L.P.(17)............... 2,443,816 9.59%
Putnam Investments, LLC(18)................................. 1,859,211 7.30%
All directors and executive officers as a group (12
persons)(19).............................................. 2,867,909 11.25%
---------------
* Less than one percent.
(1) Unless otherwise indicated, the address of each of the beneficial owners
identified is c/o Pediatrix Medical Group, Inc., 1301 Concord Terrace,
Sunrise, Florida 33323. Each holder is a beneficial owner of common stock
of Pediatrix.
(2) Based on 25,483,095 shares of common stock issued and outstanding as of
March 20, 2002. The number and percentage of shares beneficially owned is
determined in accordance with Rule 13d-3 of the Securities Exchange Act of
1934 and the information is not necessarily indicative of beneficial
ownership for any other purpose. Under that rule, beneficial ownership
includes any shares as to which the individual or entity has voting power
or investment power and any shares that the individual has the right to
acquire within 60 days of March 20, 2002, through the exercise of any stock
option or other right. Unless otherwise indicated in the footnotes or
table, each person or entity has sole voting and investment power, or
shares such powers with his or her spouse, with respect to the shares shown
as beneficially owned.
(3) Includes (i) 240 shares owned by Dr. Medel's children, as to which Dr.
Medel disclaims beneficial ownership, (ii) 771,635 shares held by Medel
Family Limited Partnership, L.P., a Delaware limited partnership, (iii)
995,000 shares subject to presently exercisable options, and (iv) 110,000
shares subject to presently exercisable options held by his wife.
8
(4) Includes (i) 7,207 shares directly owned, 6,207 of which were acquired
through Pediatrix's employee stock purchase plans, and (ii) 433,333 shares
subject to presently exercisable options.
(5) Includes (i) 1,710 shares directly owned, 1,210 of which were acquired
through the employee stock purchase plans, (ii) 141,667 shares subject to
presently exercisable options, (iii) 1,000 shares owned by his wife, which
were acquired through Pediatrix's employee stock purchase plans, and (iv)
934 shares subject to presently exercisable options held by his wife.
(6) Includes (i) 1,579 shares directly owned which were acquired through
Pediatrix's employee stock purchase plans, and (ii) 120,000 shares subject
to presently exercisable options.
(7) Includes (i) 345 shares accumulated through Pediatrix's 401(k) thrift and
profit sharing plans, (ii) 1,077 shares directly owned that were acquired
through Pediatrix's employee stock purchase plans, and (iii) 80,000 shares
subject to presently exercisable options.
(8) All 14,000 shares are subject to presently exercisable options. The address
of Mr. Alvarez is 1221 Brickell Avenue, 22nd Floor, Miami, Florida 33131.
(9) All 9,000 shares are subject to presently exercisable options. The address
of Dr. Carlo is 525 New Hillman Building, Birmingham, Alabama 35233.
(10) All 55,000 shares are subject to presently exercisable options. The address
of Mr. Carlyle is 6 Cliff Trail, Frisco, Texas 75034.
(11) Includes (i) 300 shares directly owned, and (ii) 12,500 shares subject to
presently exercisable options.
(12) Includes (i) 30,731 shares directly owned, and (ii) 17,000 shares which are
subject to presently exercisable options. The address of Mr. Fernandez is
55 Alhambra Circle, Coral Gables, Florida 33134.
(13) All 400 shares are directly owned. The address of Dr. Freeman is 5656
Naples Canal, Longbeach, California 90803.
(14) All 4,119 shares are directly owned. The address of Mr. Mackesy is 320 Park
Avenue, New York, New York 10022-6815.
(15) Includes (i) 9,147 shares directly owned, and (ii) 50,385 shares which are
subject to presently exercisable options. The address of Dr. Ratner is 3001
East President George Bush Turnpike, Richardson, Texas 75082.
(16) Wasatch Advisors, Inc., a registered investment advisor, is deemed to have
beneficial ownership of 3,556,566 shares based on the most recent Schedule
13G. The address of Wasatch Advisors, Inc. is 150 Social Hall Avenue, Salt
Lake City, Utah 84111.
(17) Welsh, Carson, Anderson & Stowe VII, L.P., a Delaware limited partnership,
is deemed to have beneficial ownership of 2,443,816 shares based on the
most recent Schedule 13D/A. The address of Welsh, Carson, Anderson & Stowe
VII, L.P. is 320 Park Avenue, Suite 2500, New York, New York, 10022.
(18) Putnam Investments, Inc., a registered investment advisor, is deemed to
have beneficial ownership of 1,859,211 shares based on the most recent
Schedule 13G. The address of Putnam Investments, Inc. is One Post Office
Square, Boston, Massachusetts 02109.
(19) Includes 2,038,819 shares subject to presently exercisable options.
9
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth certain summary information for the years
ended December 31, 2001, 2000, and 1999, concerning compensation paid or accrued
by Pediatrix and its subsidiaries to or on behalf of:
- Pediatrix's Chief Executive Officer; and
- the four other most highly compensated executive officers of Pediatrix
who were serving as executive officers at the end of the last completed
fiscal year, whose total annual salary and bonus, determined as of the
end of the last fiscal year, exceeded $100,000.
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
AWARDS
---------------
ANNUAL COMPENSATION SECURITIES
--------------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION AT BONUS($) STOCK OPTIONS COMPENSATION
DECEMBER 31, 2001 YEAR SALARY($) (1) (NO. OF SHARES) ($)(2)
------------------------------ ---- --------- -------- --------------- ------------
Roger J. Medel, M.D. ................. 2001 $600,000 $100,000 25,000 $6,906
Chairman of the Board and 2000 400,000 100,000 0 4,366
Chief Executive Officer 1999 400,000 100,000 250,000(3) 4,691
Kristen Bratberg...................... 2001 $400,000 $200,000 150,000 $5,469
President 2000 300,000 200,000 50,000 3,778
1999 300,000 655,283 200,000 3,620
Joseph M. Calabro..................... 2001 $250,000 $150,000 85,000 $5,316
Chief Operating Officer 2000 193,333 100,000 25,000 3,545
1999 160,000 80,000 80,000 3,354
Brian T. Gillon....................... 2001 $250,000 $150,000 85,000 $5,289
Executive Vice President -- 2000 200,000 125,000 0 3,539
Corporate Development, General 1999 200,000 100,000 70,000 3,294
Counsel and Secretary
Karl B. Wagner........................ 2001 $225,000 $125,000 85,000 $5,340
Chief Financial Officer and 2000 179,167 75,000 0 3,572
Treasurer 1999 150,000 50,000 80,000(4) 3,328
---------------
(1) Includes bonuses paid in a subsequent year for services performed in the
year reported.
(2) Reflects matching contributions to Pediatrix's 401(k) thrift and profit
sharing plans and the amounts paid by Pediatrix for term life insurance
coverage.
(3) 250,000 options granted on January 27, 1999, were subsequently cancelled on
July 7, 1999.
(4) 25,000 options granted on January 27, 1999, and 5,000 options granted on
March 2, 1999, were subsequently cancelled on May 10, 2000.
10
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information concerning grants of
stock options made during fiscal 2001 to Pediatrix's executive officers.
INDIVIDUAL OPTION GRANTS IN 2001 POTENTIAL REALIZABLE VALUE AT
-------------------------------------------------------- ASSUMED ANNUAL RATES OF
% OF TOTAL OPTIONS STOCK PRICE APPRECIATION FOR
NUMBER GRANTED TO EXERCISE OPTION TERM(1)
OF OPTIONS EMPLOYEES IN PRICE PER EXPIRATION -----------------------------
NAME GRANTED FISCAL 2001 SHARE(2) DATE 5% 10%
---- ---------- ------------------ --------- ---------- ------------- -------------
Roger J. Medel,
M.D................ 25,000 1.80% $36.30 12/17/2011 $ 570,722 $1,446,321
Kristen Bratberg..... 50,000 3.61% 21.38 1/5/2011 672,131 1,703,312
100,000 7.21% 34.79 8/6/2011 2,187,924 5,544,630
Joseph M. Calabro.... 35,000 2.52% 21.38 1/5/2011 470,492 1,192,319
50,000 3.61% 34.79 8/6/2011 1,093,962 2,772,315
Brian T. Gillon...... 35,000 2.52% 21.38 1/5/2011 470,492 1,192,319
50,000 3.61% 34.79 8/6/2011 1,093,962 2,772,315
Karl B. Wagner....... 35,000 2.52% 21.38 1/5/2011 470,492 1,192,319
50,000 3.61% 34.79 8/6/2011 1,093,962 2,772,315
---------------
(1) The dollar amounts set forth in these columns are the result of calculations
at the five percent and ten percent rates set by the Securities and Exchange
Commission, and therefore are not intended to forecast possible future
appreciation, if any, of the market price of the common stock.
(2) All options were granted at exercise prices equal to the fair market value
of our common stock on the date of grant.
STOCK OPTION EXERCISES AND YEAR-END OPTION VALUE TABLE
The following table sets forth certain information concerning option
exercises in fiscal 2001, the number of stock options held by Pediatrix's
executive officers as of December 31, 2001 and the value (based on the fair
market value of a share of stock at fiscal year-end) of in-the-money options
outstanding as of such date.
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED IN-THE-
NUMBER OF SHARES OPTIONS AT MONEY OPTIONS AT DECEMBER 31,
ACQUIRED ON VALUE DECEMBER 31, 2001 2001(1)
------------------- --------------------------- -----------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- -------- ----------- ------------- ------------ --------------
Roger J. Medel, M.D....... -- -- 995,000 0 $11,688,400 $ 0
Kristen Bratberg.......... -- -- 383,333 216,667 4,205,167 1,937,833
Joseph M. Calabro......... -- -- 111,667 128,333 1,339,631 1,326,269
Brian T. Gillon........... -- -- 108,333 91,667 961,033 612,717
Karl B. Wagner............ -- -- 68,333 101,667 931,558 873,167
---------------
(1) The closing sale price for Pediatrix's common stock as reported on the New
York Stock Exchange on December 31, 2001 was $33.92. Value is calculated by
multiplying (i) the difference between $33.92 and the option exercise price
by (ii) the number of shares of common stock underlying the option.
11
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AGREEMENTS
Pediatrix has entered into employment agreements with a number of the
executive officers (collectively the "Employment Agreements"). Pursuant to the
Employment Agreements, Dr. Medel and Messrs. Bratberg, Wagner and Gillon will
receive base salaries of $600,000, $400,000, $275,000 and $300,000,
respectively, in 2002. The Employment Agreements provide that such executives
are eligible to receive performance bonuses. The Employment Agreements also
provide for payments if the executive is terminated after a "change in control"
as defined in their respective employment agreement in an amount equal to 200%
of average annual compensation for Dr. Medel, and 100% of the average annual
compensation for each of Messrs. Bratberg, Wagner and Gillon for the five
taxable years prior to such termination. The executive officers each hold
options to purchase Pediatrix common stock granted under Pediatrix's Amended and
Restated Stock Option Plan. Pursuant to Pediatrix's Amended and Restated Stock
Option Plan, such options will become immediately fully exercisable in the event
of a "change in control" as defined in such plan. The Employment Agreements
provide that each executive shall not compete with Pediatrix during the
employment term and for a period of one year thereafter following the
termination of the agreement for any reason.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
Under rules established by the Securities and Exchange Commission,
Pediatrix's compensation committee is required to provide a report explaining
the rationale and considerations that led to fundamental compensation decisions
affecting Pediatrix's executive officers, including Pediatrix's Chief Executive
Officer during the past fiscal year.
General. Pediatrix's compensation committee is comprised of independent
directors and is responsible for setting and administering policies that govern
the annual compensation of Pediatrix's executive officers, as well as
Pediatrix's stock option, employee stock purchase and incentive compensation
plans. The compensation committee's general philosophy with respect to the
compensation of Pediatrix's executive officers is to offer competitive
compensation programs designed to attract and retain key executives critical to
the long-term success of Pediatrix and to recognize an individual's contribution
and personal performance. Accordingly, Pediatrix's compensation programs include
a base salary and an annual performance-based bonus as well as stock option
plans and incentive plans designed to provide long-term incentives. In addition,
the compensation committee may recommend the grant of discretionary bonuses to
executive officers.
In establishing the executive compensation program, the compensation
committee takes into account the financial performance of the Company and
compensation trends for comparable companies, and gauges achievement of
corporate and individual objectives. The base salaries of Pediatrix's executive
officers have been fixed at levels which the compensation committee believes are
competitive to retain and motivate key executives. Performance bonuses have been
structured to reinforce the achievement of both short and long-term corporate
objectives. Pediatrix uses stock options to foster a long-term perspective
aligned with that of its shareholders. The salaries for each of Pediatrix's
executive officers is set forth in such executive's employment agreement.
2001 Compensation for the Chief Executive Officer. Dr. Medel's employment
agreement with Pediatrix expires in 2006, and provides for a base salary of
$600,000 per year and a performance bonus of up to $200,000 each year if
Pediatrix meets or exceeds specific performance objectives set forth in his
employment agreement. In 2001, in addition to his base salary, Dr. Medel
received a performance bonus of $100,000 based upon such objectives. In
determining Dr. Medel's overall compensation for 2001, the compensation
committee evaluated Pediatrix's performance during 2001, focusing on the
following areas: (i) the number of neonatal intensive care unit ("NICU") patient
days; and (ii) NICU same unit growth. The compensation committee believes that
these achievements reflect the chief executive officer's strategic leadership
for Pediatrix and, as a result, awarded the chief executive officer the bonus
and stock options set forth in the Summary Compensation Table.
12
Policy on Deductibility of Incentive Compensation. Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code"), limits the tax deduction
to $1 million for compensation paid to Pediatrix's five most highly compensated
executive officers, unless certain requirements are met. In order to comply with
Section 162(m), the stock option plan limits the number of shares underlying
options awardable during the 10-year term of the stock option plan to any plan
participant and is administered by a committee consisting only of "outside
directors" (as defined in Section 162(m)). While the tax impact of any
compensation is one factor to consider, such impact is evaluated in light of the
compensation committee's overall compensation philosophy. The compensation
committee intends to establish executive officer compensation programs which
maximize Pediatrix's deduction if the compensation committee determines that
such actions are consistent with its philosophy and in the best interests of
Pediatrix and its shareholders.
Cesar L. Alvarez
Michael B. Fernandez
Waldemar Carlo, M.D.
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on
$100 invested on December 31, 1996 in Pediatrix's common stock against the
cumulative total return of the NYSE Composite Index, NASDAQ Composite Index and
the NASDAQ Health Index. The returns are calculated assuming reinvestment of
dividends. The graph covers the period from December 31, 1996 through December
31, 2001. Pediatrix's common stock is listed on the New York Stock Exchange
under the trading symbol "PDX".
(PERFORMANCE GRAPH)
-------------------------------------------------------------------------------------------
12/31/96 12/31/97 12/31/98 12/31/99 12/29/00 12/31/01
-------------------------------------------------------------------------------------------
Pediatrix Medical Group,
Inc. 100.00 115.54 161.99 18.92 65.03 91.68
NYSE Composite Index 100.00 130.31 151.88 165.77 167.44 150.34
NASDAQ Index 100.00 122.48 172.70 320.87 193.00 153.15
NASDAQ Health Index 100.00 102.60 86.98 69.96 96.04 103.83
13
CERTAIN BUSINESS RELATIONSHIPS
In March 1997, Mr. Alvarez was appointed to Pediatrix's board of directors.
Mr. Alvarez is the President and Chief Executive Officer of Greenberg Traurig,
P.A., which serves as one of Pediatrix's principal outside counsel and receives
customary fees for legal services. Pediatrix currently anticipates that such
arrangement will continue.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires Pediatrix's
officers and directors, and persons who own more than ten percent of Pediatrix's
common stock, to file with the Securities and Exchange Commission reports of
ownership and changes in ownership of Pediatrix common stock. Officers,
directors and greater than ten percent shareholders also are required by rules
promulgated by the Securities and Exchange Commission to furnish Pediatrix with
copies of all Section 16(a) forms they file.
Based solely on a review of the copies of such reports furnished to
Pediatrix, the absence of a Form 3, 4 or 5, or representations from certain
reporting persons that no Forms 5 were required, Pediatrix believes that all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten percent beneficial owners were complied with during the fiscal
year ended December 31, 2001, except that Mr. Gillon filed his Form 3 upon
becoming an executive officer one business day after the prescribed filing
deadline.
PROPOSAL TO APPROVE AMENDMENTS
TO PEDIATRIX'S EMPLOYEE STOCK PURCHASE PLANS
Shareholders are being asked to approve amendments to Pediatrix's Qualified
Employee Stock Purchase Plan and Non-Qualified Employee Stock Purchase Plan:
- to reduce the maximum number of shares issuable under the Qualified
Employee Stock Purchase Plan from 500,000 to 250,000 shares; and
- to increase the maximum number of shares issuable under the Non-Qualified
Employee Stock Purchase Plan from 500,000 to 750,000 shares.
In 1996, the Company adopted two stock purchase plans. The Qualified Plan
covers all of the full-time employees of Pediatrix and its subsidiaries. The
Non-Qualified Plan covers all of the full-time employees of Pediatrix's
affiliated professional associations, corporations and partnerships (the "PA
Contractors"). These plans are an important part of Pediatrix's compensation
program.
The proposed amendments will better enable Pediatrix to attract and retain
officers and employees, without changing the aggregate number of shares
available under both plans, by making available additional shares under the
Non-Qualified Plan which covers more employees than the Qualified Plan. On March
31, 2002, approximately 420 persons were eligible to participate in the
Qualified Plan and approximately 1,453 persons were eligible to participate in
the Non-Qualified Plan. The proposed amendments will not change the aggregate
number of shares issuable under both plans.
As of December 31, 2001, an aggregate of 562,434 shares have been issued
under the plans to approximately 780 persons, of which 142,076 shares had been
issued under the Qualified Plan and 420,358 shares had been issued under the
Non-Qualified Plan.
DESCRIPTION OF PEDIATRIX'S EMPLOYEE STOCK PURCHASE PLANS
Purpose: The purpose of each of Pediatrix's stock purchase plans is to
encourage stock ownership in Pediatrix by employees of Pediatrix, its
subsidiaries and the PA Contractors, thereby enhancing interest in the continued
success and progress of Pediatrix. The plans permit eligible participants to
purchase Pediatrix common stock at a favorable price through payroll reductions
of the participants.
14
Administration: The plans are administered by Pediatrix's compensation
committee.
Maximum Number of Shares Issuable: A maximum of 500,000 shares are
issuable under each of the plans. Upon approval of the proposed amendments by
shareholders, a maximum of 250,000 shares will be issuable under the Qualified
Plan and a maximum of 750,000 shares will be issuable under the Non-Qualified
Plan.
Purchase Periods: Purchase periods for each plan are the six-month periods
ending on the last day of March and September. Before the commencement date of
each purchase period, each eligible participant must elect to have compensation
withheld during the purchase period of either a percentage of his or her
compensation (not less than 1%) or a specific dollar amount (not less than $25).
The percentage or amount designated may not be increased or decreased during a
purchase period, but a participant can discontinue payroll deductions for the
remainder of a purchase period and withdraw his or her funds entirely. No
participant may receive an option under any plan for shares which have a fair
market value in excess of $25,000, less the 15% discount, or $21,250, in any one
calendar year.
Investing in the Plans: As of the first day of the purchase period, a
participant is granted an option to purchase that number of shares determined by
dividing the total amount to be withheld by the purchase price described below.
Based on the amount of salary withheld at the end of the purchase period, shares
will be purchased for the account of each participant within five business days
of the termination date of such purchase period. In no event, however, may a
participant receive an option for shares which would cause the participant to
own 5% or more of common stock of Pediatrix.
Purchase Prices: The purchase price to be paid by the participants will be
the lower of (i) 85% of the average of the high and low sales price of
Pediatrix's common stock as reported on the New York Stock Exchange as of the
commencement date of the purchase period and (ii) 85% of the average of the high
and low sales price of Pediatrix's common stock as reported on the New York
Stock Exchange as of the purchase date.
Eligible Participants: The Qualified Plan is available to employees of
Pediatrix and its subsidiaries who are regularly scheduled to work at least 20
hours per week and more than five months per calendar year. The Non-Qualified
Plan is available to employees of the PA Contractors who are regularly scheduled
to work at least 20 hours per week and more than five months per calendar year.
Any employee eligible to participate in the Qualified Plan is not eligible to
participate in the Non-Qualified Plan.
Qualified Plan: The provisions of the Qualified Plan are similar to the
Non-Qualified Plan in all material respects, except that:
- the eligible participants of the two plans are different, as described
above;
- each participant in the Qualified Plan agrees to promptly notify
Pediatrix in writing of any disposition of any common stock purchased
under the plan occurring within the two years after the date of the
purchase; and
- the Qualified Plan is intended to comply with Section 423 of the Code.
Other Information: The specific future benefits or amounts to be received
by executive officers and employees under the stock purchase plans as proposed
to be amended in the manner described above is not determinable. For information
on the common shares acquired through the foregoing plans by the named executive
officers and directors, see "Share Ownership of Pediatrix" above.
Copies of the Plans: The complete text of each of the foregoing plans, as
proposed to be amended in the manner described in this proxy statement, will be
furnished, upon request, without charge to each person whose proxy is being
solicited. The foregoing description of the plans is qualified in its entirety
by reference to the complete text of such plans.
15
VOTE REQUIRED AND RECOMMENDATION
Pediatrix's compensation committee has approved the proposed amendments to
Pediatrix's employee stock purchase plans and is recommending approval by
Pediatrix's shareholders because it believes that the proposed amendments are in
the best interests of Pediatrix. The proposed amendments will better enable
Pediatrix to attract and retain key officers and employees. The proposed
amendments will not change the aggregate number of shares issuable under both
plans.
Approval of the proposed amendments to Pediatrix's employee stock purchase
plans requires the affirmative vote of a majority of the votes of Pediatrix
common stock present in person or by proxy at the annual meeting, provided that
the total number of votes cast in such proposal represents a majority of the
issued and outstanding shares of Pediatrix common stock entitled to vote thereon
at the annual meeting.
PEDIATRIX'S BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
PROPOSED AMENDMENTS TO PEDIATRIX'S EMPLOYEE STOCK PURCHASE PLANS AS DESCRIBED IN
THIS PROXY STATEMENT.
16
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Pediatrix's independent public accountants for the year ended December 31,
2001, was and for 2002 will be the firm of PricewaterhouseCoopers LLP. It is
expected that representatives of such firm will (i) attend the annual meeting,
(ii) have an opportunity to make a statement if they desire to do so, and (iii)
be available to respond to appropriate questions.
OTHER BUSINESS
The board of directors knows of no other business to be brought before the
annual meeting. If, however, any other business should properly come before the
annual meeting, it is the intention of the persons named in the accompanying
proxy card to vote the shares they represent in accordance with the
recommendation of Pediatrix's board of directors.
INFORMATION CONCERNING SHAREHOLDER PROPOSALS
Pursuant to Rule 14a-8 promulgated by the Securities and Exchange
Commission and Pediatrix's amended and restated articles of incorporation, a
shareholder intending to present a proposal to be presented at Pediatrix's 2003
annual shareholders' meeting must deliver a proposal in writing to Pediatrix's
principal executive offices to be received on or before December 17, 2002, but
not earlier than October 18, 2002, or such proposal will be considered untimely.
By Order Of The Board of Directors
/s/ Roger J. Medel
Roger J. Medel, M.D.
Chairman of the Board and
Chief Executive Officer
Sunrise, Florida
April 15, 2002
17
(PEDIATRIX LOGO)
MEDICAL GROUP, INC.
1424-PS-02
1424-PS-02
FORM OF PROXY
PEDIATRIX MEDICAL GROUP, INC.
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned, a shareholder of PEDIATRIX MEDICAL GROUP, INC., a
Florida corporation (the "Company"), hereby appoints Roger J. Medel, M.D., Karl
B. Wagner and Brian T. Gillon, and each of them, as proxies for the undersigned,
each with full power of substitution, and hereby authorizes them to represent
and to vote, as designated on the reverse side of this proxy card, all of the
shares of common stock of the Company held of record by the undersigned at the
close of business on April 2, 2002, at the Company's 2002 Annual Meeting of
Shareholders to be held at the Crowne Plaza Hotel, 13400 West Sunrise Boulevard,
Sunrise, Florida 33323, on May 14, 2002 at 1:00 p.m., local time, and at any
adjournments thereof.
PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY PROMPTLY USING THE ENVELOPE
PROVIDED. NO POSTAGE NECESSARY IF MAILED IN THE UNITED STATES.
(See reverse side)
(Continued from other side)
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" ALL OF THE PROPOSALS.
The board of directors unanimously recommends a vote FOR each of the
following Directors' proposals.
[X] Please mark vote as in example.
1. ELECTION OF Roger J. Medel, M.D.
DIRECTORS M. Douglas Cunningham, M.D.
Kristen Bratberg
Cesar L. Alvarez
Michael B. Fernandez
Waldemar A. Carlo, M.D.
John K. Carlyle
Ian M. Ratner
Roger K. Freeman, M.D.
[ ] 1 VOTE FOR all nominees listed above, except authority
to vote withheld from the following nominees
(if any):__________________________________________
Instruction: To withhold authority to vote for any
individual nominee, write that nominee(s) name(s) on
the line above.
[ ] 2 AUTHORITY TO VOTE WITHHELD from all nominees.
2. To approve the proposed amendments to the Company's employee
stock purchase plans to reduce the maximum number of shares
issuable under the Qualified Plan by 250,000 shares and to
increase the maximum number of shares issuable under the
Non-Qualified Plan by an equal amount; and
[ ] 1 [ ] 2 [ ] 3
FOR AGAINST ABSTAIN
3. In their discretion, the proxies are authorized to vote upon
such other matters as may properly come before the Annual
Meeting and any postponement or adjournment thereof.
The undersigned hereby acknowledges receipt of (1) the Notice of Annual
Meeting for the 2002 Annual Meeting, (2) the Proxy Statement, and (3) the
Company's 2002 Annual Report to Shareholders.
Dated: _________________, 2002
__________________________________
(Signature)
__________________________________
(Signature if held jointly)
IMPORTANT: Please sign exactly as your name appears hereon and mail it promptly
even if you plan to attend the meeting. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. When shares
are held by joint tenants, both should sign. If a corporation, please sign in
full corporate name by president or other authorized officer. If a partnership,
please sign in partnership name by authorized person.
A-2