SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
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[X] Preliminary Proxy Statement
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Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
RADIOLOGIX, INC
(Name of Registrant as Specified In Its Charter)
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(RADIOLOGIX LOGO)
3600 JP Morgan Chase Tower
2200 Ross Avenue
Dallas, Texas 75201-2776
Telephone (214) 303-2776
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 10, 2003
To the Stockholders of Radiologix, Inc.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Radiologix, Inc., a Delaware corporation (the "Company"), will be held at 2200
Ross Avenue, 39th Floor, Dallas, Texas 75201-2776, on Tuesday, June 10, 2003, at
8:00 a.m., Dallas, Texas time, for the following purposes:
(1) To elect six individuals to serve as directors until the 2004 Annual
Meeting of Stockholders and until their successors are duly elected
and qualified.
(2) To ratify the appointment of Ernst & Young LLP as the Company's
independent public accountants for 2003.
(3) To approve an amendment to the Company's Amended and Restated
Certificate of Incorporation.
(4) To transact any other business that may properly come before the
meeting or any adjournments of the meeting.
These items of business are more fully described in the proxy statement
accompanying this Notice.
The Board of Directors has fixed the close of business on April 28, 2003,
as the record date for determining stockholders entitled to notice of, and to
vote at, the meeting and any adjournments.
All stockholders are invited to attend the meeting in person. WHETHER OR
NOT YOU PLAN TO ATTEND THE MEETING IN PERSON, TO ASSURE YOUR REPRESENTATION AT
THE MEETING, PLEASE FILL OUT, SIGN, DATE AND MAIL PROMPTLY THE ENCLOSED PROXY
CARD IN THE ACCOMPANYING ENVELOPE. No postage is required if mailed in the
United States. Proxies forwarded by or for brokers or fiduciaries should be
returned in accordance with their instructions to you.
BY ORDER OF THE BOARD OF DIRECTORS,
Paul M. Jolas
General Counsel, Executive Vice President
and Secretary
Dallas, Texas
April __, 2003
1
(Radiologix Logo)
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 10, 2003
SOLICITATION, VOTING AND REVOCABILITY OF PROXIES
GENERAL
The Board of Directors of Radiologix, Inc. ("Radiologix" or the "Company")
is soliciting the accompanying proxy card for use at the Company's Annual
Meeting of Stockholders to be held on Tuesday, June 10, 2003, at 8:00 a.m.
Dallas, Texas, time (the "Annual Meeting") and at any adjournments of the Annual
Meeting, for the purposes set forth in this proxy statement and in the
accompanying Notice of Annual Meeting of Stockholders. The Annual Meeting will
be held at 2200 Ross Avenue, 39th Floor, Dallas, Texas 75201-2776. The Company's
telephone number is (214) 303-2776. This proxy statement, the accompanying proxy
card and a copy of the Company's 2002 Annual Report to Stockholders are first
being sent or given to stockholders on or about April __, 2003.
RECORD DATE; OUTSTANDING SHARES
Stockholders of record at the close of business on April 28, 2003 (the
"Record Date"), are entitled to notice of and to vote at the Annual Meeting and
any adjournments. On the Record Date, 21,695,153 shares of the Company's Common
Stock, par value $.0001 per share ("Common Stock"), were issued and outstanding.
REVOCABILITY OF PROXIES
Any proxy given in response to this solicitation may be revoked by the
person giving it at any time before it is voted. Proxies may be revoked before
they are voted at the Annual Meeting by (i) filing a written notice of
revocation bearing a later date than the accompanying proxy card with the
Company's Secretary (Paul M. Jolas), (ii) executing a later dated proxy card
relating to the same shares and delivering it to the Company's Secretary before
or at the Annual Meeting or (iii) attending the Annual Meeting and voting in
person. Attendance at the Annual Meeting will not in and of itself constitute
revocation of a proxy.
VOTING AND SOLICITATION
Each share of Common Stock is entitled to one vote for each director to be
elected and upon all other matters submitted for a vote at the Annual Meeting.
Cumulative voting for the election of directors is not permitted.
Radiologix will pay the cost of soliciting proxies. In addition to
soliciting proxies by mail, Radiologix may solicit proxies by personal
interview, telephone, and similar means. No director, officer, or employee of
Radiologix will be specially compensated for these activities. [Radiologix has
retained ______________, a proxy soliciting firm, to assist in the solicitation
of proxies. ______________'s solicitation fee is $_______, plus reimbursement of
certain out-of-pocket expenses.]
QUORUM; ABSTENTIONS, BROKER NON-VOTES
The required quorum for transacting business at the Annual Meeting is the
presence in person or by proxy of a majority of the shares eligible to be cast
by holders of Common Stock issued and outstanding on the Record Date. Shares
voted "FOR," "AGAINST" or "ABSTAIN" are treated as being present at the meeting
for purposes of establishing a quorum. They are also treated as shares entitled
to vote at the Annual Meeting (the "Votes Cast").
While no definitive Delaware statutory or case law addresses the proper
treatment of abstentions, we believe that abstentions should be counted to
determine the total number of Votes Cast with respect to a proposal (other than
the election of directors). In the absence of a controlling precedent to the
contrary, we intend to treat abstentions the same as a vote against a proposal.
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Brokers who hold shares in street name for customers generally may not vote
on certain matters unless they have received instructions from beneficial
owners. Brokers who do not receive instructions, however, may vote on the
election of directors. In this proxy statement, "broker non-votes" means votes
that brokers could have cast on other matters with respect to uninstructed
shares if the brokers had received their customers' instructions. The Delaware
Supreme Court has held that, while broker non-votes should be counted to
determine the presence or absence of a quorum, broker non-votes should not be
counted in determining the number of Votes Cast with respect to a particular
proposal on which a broker has expressly not voted. Radiologix intends to treat
broker non-votes in this manner. Accordingly, a broker non-vote will not have
any effect on the outcome of the voting on proposals other than the proposal to
approve an amendment to the Amended and Restated Certificate of Incorporation. A
broker non-vote will have the effect of a vote against approval of that
amendment.
PROPOSAL I: ELECTION OF DIRECTORS
NOMINEES
The Company's Board of Directors consists of six members, each of whom is a
nominee for re-election at the Annual Meeting. Unless otherwise instructed, the
proxy holders will vote all proxies received FOR the Company's nominees named
below. If any nominee becomes unable or declines to serve as a director at the
time of the Annual Meeting, proxies will be voted for any nominee designated by
the present Board to fill the vacancy. Radiologix is not aware of any nominee
who will be unable or will decline to serve as a director. The term of office of
each person elected as a director will continue until the next annual meeting of
stockholders or until his successor has been elected and qualified.
The nominees' names and certain information about each of them are set forth
below.
NAME AGE CURRENT POSITION DIRECTOR SINCE
---- --- ---------------- --------------
Marvin S. Cadwell(1)(2) 60 Chairman of the Board and Director 2002
Paul D. Farrell(1)(2) 39 Director 2000
Stephen D. Linehan 53 Director, Chief Executive Officer 2003
and President
Joseph C. Mello(1) 44 Director 2001
Derace L. Schaffer, M.D. 55 Director 1996
Michael L. Sherman, M.D. 60 Director 1997
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(1) Member of the Audit Committee and the Compensation and Stock Plan
Administration Committee of the Board of Directors.
(2) Member of the Nominating Committee of the Board of Directors.
MARVIN S. CADWELL has served as a director of the Company since June 2002.
He was appointed Chairman of the Board in December 2002. Mr. Cadwell has served
since December 2001 as President and Chief Executive Officer of SoftWatch, Ltd.,
a company that provides internet software for the healthcare industry. From
August 1995 until September 2000, Mr. Cadwell was President, Chief Executive
Officer and a director of Shared Medical Systems Corporation, an application
service provider (ASP) that supplied information systems to healthcare
providers. He served as President and a director of that company starting in
April 1995, and held a series of executive positions for various operations
starting in 1975. Since 2001, Mr. Cadwell has also served as a director of
eHealth Contracts, Inc., which provides contract management software to
hospitals. He received his B.S. in Management from Wayne State University.
PAUL D. FARRELL (CFA) has been a Radiologix director since 2000. From
November 2001 to January 2003, he served as Senior Vice President of Pequot
Capital, a private investment advisory firm. He became a principal of Pequot
Capital in January 2003. From February 2000 to November 2001, Mr. Farrell was a
partner with WR Capital Partners, an investment partnership focused on leveraged
investments in private and public small capitalization companies. From August
1991 until he joined WR Capital Partners, Mr. Farrell was employed at Goldman
Sachs & Co. as a Managing Director and Chief Investment Officer of the U.S.
value investment team.
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Prior to joining Goldman Sachs & Co., Mr. Farrell served as a Managing Director
at Plaza Investments, the investment subsidiary of GEICO Corp., a major
insurance company. From June 1986 through January 1991, Mr. Farrell was a Vice
President of Goldman Sachs & Co. in the investment research department and was
responsible for forming that firm's Emerging Growth Research Group. Mr. Farrell
received his B.A. and M. A. in Economics from Yale University in 1985.
STEPHEN D. LINEHAN became President and Chief Executive Officer of the
Company and was appointed as a Company director in February 2003. From May 2000
to August 2002, he was a director and the President and Chief Executive Officer,
respectively, of Rotech Healthcare, Inc., a $600 million revenues public company
in the business of operating centers that provide home respiratory care and
medication and services to patients with breathing disorders. From October 1998
to May 2000, Mr. Linehan served as Chief Executive Officer of National Healing
Corporation, a privately held multi-site wound care company. From March 1997 to
October 1998, he operated Linehan and Associates Consulting, through which he
served as an investment banker, Chief Executive Officer and in other capacities
for various clients. Prior to that, he was Chief Executive Officer of Value Rx,
Inc., a one billion revenues pharmacy benefits management company. Mr. Linehan
received his B.S., Business Administration from the University of North Dakota
in 1973 and his MBA from Lindenwood College in 1980.
JOSEPH C. MELLO has been a Radiologix director since 2001. He has been Chief
Operating Officer of Davita, Inc., a public company engaged in the business of
owning and operating dialysis centers, since June 2000. Prior to joining Davita,
Inc., Mr. Mello served as President and Chief Executive Officer of Vivra Asthma
& Allergy from April 1998. From August 1994 to April 1998, Mr. Mello held
various positions with MedPartners, Inc., including Senior Vice President/ Chief
Operating Officer - Southeastern region from March 1997 to April 1998. Prior to
joining MedPartners, Mr. Mello was a partner with KPMG LLP, from 1984 to 1994.
DERACE L. SCHAFFER, M.D. is a Radiologix founder and director. Dr. Schaffer
is founder and since 1990 has served as Chairman and Chief Executive Officer of
the Lan Group, a venture capital firm. From January 1980 until December 2001,
Dr. Schaffer was Chairman and Chief Executive Officer of The IDE Group, P.C.,
one of the radiology practices with which Radiologix has a contractual
relationship. He continued to serve as a director of The IDE Group, P.C. until
December 31, 2002. Dr. Schaffer is founder and Chairman of Patient InfoSystems,
Inc., a public company. He is also a member of the boards of directors at
Logisticare, Inc.; a non-emergency medical transportation company, Allion
Healthcare, Inc., which provides home healthcare, and Cardsystems, Inc., a
credit card processing company. Dr. Schaffer is a board certified radiologist.
He received his postgraduate radiology training at the Harvard Medical School
and Massachusetts General Hospital, where he served as Chief Resident. Dr.
Schaffer is a member of Alpha Omega Alpha, the national medical honor society,
and is Clinical Professor of Radiology at the University of Rochester School of
Medicine.
MICHAEL L. SHERMAN, M.D. has been a Radiologix director since 1997. Dr.
Sherman served as President from 1995 to 2001 and is currently Chairman of the
Board of Advanced Radiology, P.A., an 80-person radiology practice in Baltimore,
Maryland, with which Radiologix has a contractual relationship. He is a director
of MedStar Health, a seven-hospital system in the Baltimore-Washington, D.C.
market. Dr. Sherman attended Duke University and University of Maryland Medical
School, where he also received his radiology training.
VOTE REQUIRED
The affirmative vote of a plurality of the Common Stock present in person or
represented by proxy at the Annual Meeting is required to elect the nominees for
director named above.
THE BOARD RECOMMENDS A VOTE FOR ELECTION OF THE NOMINEES FOR DIRECTOR NAMED
ABOVE.
MEETINGS OF DIRECTORS AND COMMITTEES
Radiologix is managed under the direction of the Board. The Board meets to
review significant developments affecting Radiologix and to act on matters
requiring Board approval. It also holds special meetings when an important
matter requires Board action between scheduled meetings. The Board met 10 times
during 2002. Each member of the Board participated in at least 75% of all Board
and applicable committee meetings held.
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The Board has established Audit, Compensation and Stock Plan Administration,
and Nominating Committees to devote attention to specific subjects and to assist
it in the discharge of its responsibilities. The functions of those committees,
their current members and the number of meetings held during 2002 are described
below.
Audit Committee. The Audit Committee provides the opportunity for direct
communication between the independent public accountants and the Board. The
Audit Committee meets with the certified public accountants periodically to
review their effectiveness during the annual audit program and to discuss the
Company's internal control policies and procedures. Members of the Audit
Committee are Marvin S. Cadwell, Joseph C. Mello and Paul D. Farrell. The Audit
Committee met seven times in 2002.
Compensation and Stock Plan Administration Committee. The Compensation and
Stock Plan Administration Committee (the "Compensation Committee") provides
recommendations to the Board regarding salaries and other compensation of
Radiologix executive officers. During the first part of 2002, the nonemployee
members of the Board of Directors performed the functions of the Compensation
Committee. In November 2002, Marvin S. Cadwell, Joseph C. Mello and Paul D.
Farrell were appointed as sole members of the Compensation Committee. The
Compensation Committee met once during 2002.
Nominating Committee. The Nominating Committee provides recommendations to
the Board regarding persons qualified to serve on the Company's Board of
Directors, any of its committees, or as an executive officer of the Company. The
Nominating Committee was formed in 2003. It did not have any meetings during
2002.
PROPOSAL II: RATIFICATION OF APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
Ernst & Young LLP has been appointed as the Company's independent public
accountants for 2003, subject to stockholder ratification. Representatives of
Ernst & Young LLP, the Company's independent public accountants for 2002, are
expected to be present at the Annual Meeting with the opportunity to make a
statement if they so desire and to be available to respond to appropriate
questions.
From the Company's inception through 2001, Arthur Andersen LLP served as the
Company's independent public accountants. As a result of its indictment by the
United States Department of Justice following the bankruptcy of Enron Corp.,
Radiologix released it from future service to the Company effective April 22,
2002. Arthur Andersen LLP's report on the Company's financial statements never
contained an adverse opinion or disclaimer of opinion, nor was it ever qualified
or modified as to uncertainty, audit scope, or accounting principles. Radiologix
and Arthur Andersen LLP never had any disagreement on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or
procedure. The Company's Audit Committee recommended and approved the decision
to release Arthur Andersen LLP.
VOTE REQUIRED
The affirmative vote of a majority of the shares of Common Stock present in
person or represented by proxy at the Annual Meeting and entitled to vote is
required to ratify the appointment of Ernst & Young LLP.
THE BOARD RECOMMENDS A VOTE FOR THE PROPOSAL TO RATIFY THE APPOINTMENT OF
ERNST & YOUNG LLP.
AUDIT COMMITTEE REPORT
The Audit Committee of the Board of Directors (the "Audit Committee")
operates under a written charter adopted by the Board of Directors in June 2000
in accordance with Securities and Exchange Commission and American Stock
Exchange rules. Members of the Audit Committee are Marvin S. Cadwell, Paul D.
Farrell and Joseph C. Mello.
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Management is responsible for the Company's internal controls and the
financial reporting process. The independent public accountants are responsible
for performing an independent audit of the Company's consolidated financial
statements in accordance with generally accepted auditing standards and to issue
a report. The Audit Committee's responsibility is to monitor and oversee these
processes. The Audit Committee also recommends to the Board of Directors the
selection of the Company's independent public accountants.
In this context, the Audit Committee met and held discussions with
management, who represented to the Audit Committee that the Company's
consolidated financial statements were prepared in accordance with accounting
principles generally accepted in the United States. The Audit Committee reviewed
and discussed the consolidated financial statements with both management and the
independent public accountants. The Audit Committee also discussed with the
independent public accountants matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees). The Company's
independent public accountants also provided the Audit Committee with written
disclosures required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees), and the Audit Committee
discussed with the independent public accountants their independence.
Based upon the Audit Committee's discussion with management and the
independent public accountants, and the Audit Committee's review of management's
representation and the independent public accountants' report to the Audit
Committee, the Audit Committee recommended that the Board of Directors include
the audited consolidated financial statements in the Company's Annual Report on
Form 10-K for 2002, filed with the Securities and Exchange Commission.
Members of the Audit Committee:
Paul D. Farrell (Chairman)
Marvin S. Cadwell
Joseph C. Mello
INDEPENDENT ACCOUNTANT FEES
2002 Audit Firm Fee Summary. During 2002, Radiologix retained Ernst & Young
LLP to provide services in the following categories and amounts:
Audit Fees.............................. $ 261,135
Financial Information Systems Design
and Implementation Fees.............. $ 0
All Other Fees*......................... $ 61,886
* Includes accounting, transaction, and securities regulatory assistance, and
tax services (compliance, returns, and planning)
The Audit Committee considered the services that Ernst & Young LLP performed
for Radiologix other than in conjunction with the audit and review of its
consolidated financial statements and determined that those services are
compatible with maintaining Ernst & Young LLP's independence.
PROPOSAL III: TO APPROVE AN AMENDMENT TO THE COMPANY'S AMENDED AND
RESTATED CERTIFICATE OF INCORPORATION
The Board of Directors has unanimously determined that an amendment to the
Company's Amended and Restated Certificate of Incorporation ("Charter") is
advisable and voted to recommend the amendment to the stockholders for approval.
The proposed amendment to the Charter is summarized and set forth below.
BACKGROUND OF THE PROPOSED AMENDMENT
Prior to the Company's initial public offering in 1997, the Company's Bylaws
were amended and restated. Among other changes, requirements were added to
Article III, Section 2 of the Bylaws that if the number of members of the Board
of Directors increases to either seven or nine, then at least two or three
members,
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respectively, must be physicians who provide services to a business acquired by
the Company. The primary reason for this addition to the Bylaws was that many of
the physicians who provide or provided such services received Company Common
Stock in connection with the initial public offering, in exchange for the sale
of their business operations other than the practice of medicine. With so many
physicians holding an equity stake in the Company, this provision provided for
representation of their interests on the Board of Directors.
Since the Company's Charter provides that the Company's Board of Directors
has the power to amend the Company's Bylaws, and thereby remove the
above-described requirement for physician representation on the Board, the
Company's Charter was also amended. A restriction was added to Article VII of
the Charter that prohibits the Board from altering, amending, or repealing the
Article III, Section 2 Bylaw requirement for physician representation on the
Board.
In the years following the Company's initial public offering, most of the
doctors who received stock in connection with the initial public offering have
disposed of that stock. As a result, the circumstances that led to the addition
of the Bylaw requirement for physician representation on the Board, and the
addition of the Charter amendment prohibiting the Board from changing the Bylaw
requirement, no longer exist.
In addition, since the passage of the Sarbanes-Oxley Act of 2002 to impose
certain corporate governance reforms, the New York Stock Exchange and the
American Stock Exchange have proposed rules to require publicly held companies
to elect boards of directors having a majority of independent directors.
Historically, the Company has been of the opinion that directors who are or were
physicians who provide services to a business acquired by the Company are not
independent. If the size of the Company's Board grows, the Bylaw requirement for
physician representation on the Board of Directors would prevent the Company
from having more independent board membership. The Board has no authority to
change this requirement unless the proposed Charter amendment is approved.
If the Company's stockholders approve the proposed Charter amendment, then
the Board of Directors intends to repeal the Article III, Section 2 Bylaw
requirement for physician representation on the Board.
DESCRIPTION OF THE PROPOSED AMENDMENT
Article VII of the Company's Amended and Restated Certificate of
Incorporation states as follows:
The management of the business and conduct of the affairs of
the Corporation shall be vested in its Board. The number of directors
which shall constitute the whole Board shall be fixed by, or in the
manner provided in, the Bylaws of the Corporation. In furtherance and
not in limitation of the Board's power to manage the business and
conduct the affairs of the Corporation, the Board shall have the power,
upon the affirmative vote of at least a majority of the Directors then
serving, to adopt, amend or repeal from time to time the Bylaws of the
Corporation, subject to the right of the stockholders entitled to vote
thereon to adopt, amend or repeal the Bylaws. Notwithstanding the
foregoing, the Board shall not have the power to alter, amend or repeal
THE SECOND OR THIRD SENTENCES OF THE FIRST PARAGRAPH OF ARTICLE III,
SECTION 2 OF THE BYLAWS REGARDING THE COMPOSITION OF THE BOARD, OR any
OTHER Bylaw (or Article or Section thereof) that expressly provides
that it cannot be altered, amended or repealed by the Board.
The proposed amendment would remove the words highlighted and underlined
above from the text of Article VII of the Charter.
VOTE REQUIRED
The affirmative vote of a majority of the shares of Common Stock entitled to
vote is required to approve the proposed amendment to Article VII of the
Charter. Brokers holding shares for which beneficial owners do not provide
voting instructions are not entitled to vote to approve the proposed amendment.
Therefore, broker non-votes will have the effect of votes AGAINST this matter.
THE BOARD RECOMMENDS A VOTE FOR THE PROPOSAL TO APPROVE AN AMENDMENT TO THE
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION.
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OTHER BUSINESS
The enclosed proxy card confers on the proxy holders discretionary authority
to vote on other business that may properly come before the Annual Meeting,
including matters as to which Radiologix did not receive notice a reasonable
time before this proxy statement is mailed, and including a motion, if any, to
adjourn the meeting to provide more time to solicit additional votes. Management
knows of no other such business. If any other business properly comes before the
Annual Meeting, the persons named in the enclosed form of proxy intend to vote
the shares they represent as Radiologix may recommend.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information about beneficial ownership of the
Common Stock as of April 28, 2003, by (i) all persons known to Radiologix to own
beneficially more than 5% of the outstanding Common Stock, (ii) each Radiologix
director and nominee for director, (iii) each Radiologix executive officer, and
(iv) all Radiologix directors and executive officers as a group. See "Executive
Compensation -- Stock Option Grants and Exercises" for additional information
about options that are not currently exercisable.
PERCENTAGE OF OUTSTANDING
SHARES OF COMMON STOCK COMMON STOCK
NAME (1) BENEFICIALLY OWNED(2) BENEFICIALLY OWNED
-------- ---------------------- -------------------------
Sami S. Abbasi(3) .......................... 117,500 *
Marvin S. Cadwell(4) ....................... 14,000 *
Paul D. Farrell(5) ......................... 101,000 *
Paul M. Jolas(6) ........................... 193,633 *
Stephen D. Linehan(7) ...................... 250,000 1.1%
Joseph C. Mello(8) ......................... 21,500 *
Derace L. Schaffer, M.D.(9) ................ 618,908 2.8%
Michael L. Sherman, M.D.(10) ............... 145,734 *
All directors and executive officers
as a group (eight persons)(11) .......... 1,462,275 6.5%
Barclays Global Investors, NA(12) .......... 1,069,629 5.0%
Barclays Global Fund Advisors
45 Fremont Street
San Francisco, CA 94105
Goldman Sachs Asset Management(13) ......... 1,122,863 5.2%
The Goldman Sachs Group, Inc.
10 Hanover Square
New York, NY 10005
Jana Partners LLC(14) ...................... 1,970,300 9.1%
536 Pacific Avenue
San Francisco, CA 94133
MidOcean Capital Partners SB, L.P.(15) ..... 1,593,040 7.3%
345 Park Avenue, 16th Floor
New York, 10154
Wellington Management Company, LLP(16) ..... 1,390,100 6.4%
75 State Street
Boston, MA 02109
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* Less than one percent.
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(1) The address of all individuals named in the table is c/o Radiologix, Inc.,
3600 JP Morgan Chase Tower, 2200 Ross Avenue, Dallas, Texas 75201-2776.
(2) Beneficial ownership includes voting or investment power with respect to
securities in accordance with rules of the Securities and Exchange
Commission. Common Stock issuable within 60 days upon exercise or
conversion of an option or other security is deemed outstanding and to be
beneficially owned by the option or other security holder to compute the
holder's percentage ownership. It is not deemed outstanding in computing
the percentage ownership of any other person. Except for shares held
jointly with a person's spouse or subject to applicable community property
laws, or as indicated in the footnotes to this table, each stockholder
identified in the table has sole voting and investment power over all
shares shown as beneficially owned by that stockholder.
(3) All shares included in the table underlie options exercisable within 60
days.
(4) Includes options to purchase 6,000 shares exercisable within 60 days.
(5) Includes options to purchase 30,000 shares exercisable within 60 days.
(6) Includes options to purchase 165,633 shares exercisable within 60 days.
(7) Includes options to purchase 200,000 shares exercisable within 60 days.
(8) Includes options to purchase 17,500 shares exercisable within 60 days.
(9) Includes options to purchase 45,666 shares exercisable within 60 days.
(10) Includes options to purchase 65,666 shares exercisable within 60 days.
(11) Includes options to purchase 647,965 shares exercisable within 60 days.
(12) These securities are held by a group of banks in trust accounts for the
benefit of the beneficiaries of those accounts. Barclays Global Investors,
NA claims sole voting power and no dispositive power over 954,271 shares
included in the table. Barclays Global Fund Advisors claims sole voting
power and no dispositive power over 115,358 shares included in the table.
The information included in the table and in this footnote is derived from
Amendment No. 1 to the group's Schedule 13G/A dated March 11, 2003, filed
with the Securities and Exchange Commission.
(13) Goldman Sachs Asset Management is a separate business unit of The Goldman
Sachs Group, Inc. Goldman Sachs Asset Management has sole voting power over
1,051,135 shares included in the table and sole dispositive power over
1,122,863 shares included in the table. The Goldman Sachs Group, Inc.
disclaims beneficial ownership of these securities. The information
included in the table and in this footnote is derived from Amendment No. 1
to Goldman Sachs Asset Management's Schedule 13G dated March 7, 2003, filed
with the Securities and Exchange Commission.
(14) Jana Partners LLC is a private money management firm that holds the shares
included in the table in accounts under its management and control. Jana
Partners LLC has sole voting and sole dispositive power over all shares
included in the table. The information included in the table and in this
footnote is derived from Amendment No. 1 to Jana Partners LLC's Schedule
13D/A dated March 4, 2003, filed with the Securities and Exchange
Commission.
(15) Includes the right to acquire 1,593,040 shares upon the conversion of
senior subordinated notes held by MidOcean Capital Partners SB, L.P.,
formerly DB Captial Partners SBIC, L.P. Ultramar Capital, Ltd., MidOcean
Capital Partners, L.P, Existing Fund GP, Ltd., MidOcean Partners, LP and
MidOcean Associates, SPC may all be deemed to be beneficial owners of the
shares as a result of their direct or indirect control relationship with
MidOcean Capital Investors, L.P. MidOcean Capital Partners, L.L.C. is the
general partner of MidOcean Capital Partners SB, L.P. MidOcean Capital
Partners, L.P. is the managing member of MidOcean Capital Partners, L.L.C.
Existing Fund GP, Ltd. is the general partner of MidOcean Capital Partners,
L.P. MidOcean Partners, LP is the sole owner of Existing Fund GP, Ltd. and
MidOcean Associates, SPC is the general partner of MidOcean Partners, LP.
On February 21, 2003, MidOcean Partners, LP, and Existing Fund GP, Ltd.
acquired an 80% limited partnership interest and a general partnership
interest, respectively, in DB Capital Partners, L.P. from DB Capital
Partners, Inc. Prior to this
9
time, none of Ultramar Capital, Ltd., Existing Fund GP, Ltd., MidOcean
Partners, LP or MidOcean Associates, SPC had a beneficial ownership
interest in the common stock. J. Edward Virtue may be deemed the beneficial
owner of the shares because he indirectly controls the securities, but
disclaims beneficial ownership except to the extent of his pecuniary
interest therein. The address for MidOcean Capital Partners, L.L.C.,
MidOcean Capital Partners, L.P., Existing Fund GP, Ltd., MidOcean Partners,
LP and MidOcean Associates, SPC is 345 Park Avenue, 16th Floor, New York,
New York 10154. The address for DB Capital Partners, Inc. is 31 West 52nd
Street, New York, New York 10019.
(16) Wellington Management Company, LLP holds the shares included in the table
in its capacity as an investment advisor through its wholly owned
subsidiary Wellington Trust Company, NA. It has sole voting power over
917,300 shares and sole dispositive power over 1,390,100 shares included in
the table. The information included in the table and in this footnote is
derived from Wellington Management Company, LLP's Schedule 13G dated
February 14, 2003, filed with the Securities and Exchange Commission.
EXECUTIVE OFFICERS OF RADIOLOGIX
Set forth below is information about each executive officer of Radiologix,
including their ages as of April 28, 2003, and their positions with Radiologix.
NAME AGE POSITION
---- --- --------
Stephen D. Linehan 53 Chief Executive Officer, President and Director
Sami S. Abbasi. 38 Executive Vice President and Chief
Financial Officer
Paul M. Jolas. 39 Executive Vice President, General Counsel
and Secretary
Messrs. Linehan, Abbasi and Jolas serve pursuant to employment agreements.
Information regarding each executive officer who is not a director nominee is
set forth below.
SAMI S. ABBASI rejoined Radiologix as Chief Financial Officer and Executive
Vice President in December 2000. From January 2000 through June 2000, Mr. Abbasi
served as Chief Financial Officer and Chief Operating Officer of Adminiquest,
Inc., a private company that provided web-enabled and full-service outsourcing
solutions to the insurance and benefits industry. From August 1996 through
December 1999, he was Chief Financial Officer and Senior Vice President of
Radiologix. From January 1995 through July 1996, Mr. Abbasi served as Vice
President in the Healthcare Group of Robertson, Stephens and Company, where he
was responsible for investment banking business development and executing a
broad range of corporate finance transactions and mergers and acquisitions. From
June 1988 through January 1995, he held various positions at Citicorp
Securities, including Vice President and Senior Industry Analyst in the
Healthcare Group. Mr. Abbasi received his M.B.A. from the University of
Rochester and his B.A. in Economics from the University of Pennsylvania.
PAUL M. JOLAS was promoted to Executive Vice President from Senior Vice
President in December 2000 and has served as General Counsel of Radiologix since
August 1996 and as Secretary since October 1996. From September 1989 through
July 1996, Mr. Jolas was an attorney with the law firm of Haynes and Boone, LLP
in Dallas, Texas. He practiced in the corporate finance section and was
responsible for a broad range of corporate and securities transactions including
numerous initial and secondary public offerings of equity and debt securities,
mergers and acquisitions and public company reporting requirements. Mr. Jolas
received his J.D. from Duke University School of Law and his B.A. in economics
from Northwestern University.
EXECUTIVE COMPENSATION
The table below sets forth information concerning annual and long-term
compensation for services in all capacities to Radiologix for 2002, 2001 and
2000 for Radiologix's (i) Chief Executive Officer and (ii) its three other
executive officers (collectively, with the Chief Executive Officer, the "Named
Executives").
10
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
------------
AWARDS
------------
ANNUAL COMPENSATION(1) SECURITIES
----------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS COMPENSATION
------------------------------------ ---- ---------- ---------- ------------ ------------
Mark L. Wagar(2) ................... 2002 $ 442,000 -- 75,000 $ 121,870(2)
Chairman of the Board and ........ 2001 425,000 $ 405,000 -- --
Chief Executive Officer .......... 2000 415,475 60,000 120,000 --
Mark S. Martin(3) .................. 2002 $ 338,000 -- 50,000 --
President and .................... 2001 325,000 $ 295,000 -- --
Chief Operating Officer .......... 2000 294,705 39,542 100,000 --
Sami S. Abbasi(4) .................. 2002 $ 286,000 -- 75,000 --
Executive Vice President and ..... 2001 275,000 $ 315,000 200,000 --
Chief Financial Officer .......... 2000 38,087 -- -- --
Paul M. Jolas ...................... 2002 $ 229,500 -- 15,000 --
Executive Vice President, ........ 2001 221,942 $ 185,000 -- --
General Counsel and Secretary .... 2000 195,631 27,000 58,000 --
----------
(1) Perquisites are not included because the aggregate amount is less than the
lesser of $50,000 or 10% of salary and bonus, in accordance with Securities
and Exchange Commission regulations.
(2) Mr. Wagar resigned as Chairman of the Board effective December 4, 2002, and
as Chief Executive Officer in February 2003. The amount included in the
table in the All Other Compensation column is severance compensation paid
to Mr. Wagar in 2002.
(3) Mr. Martin resigned his positions with the Company in February 2003.
(4) Mr. Abbasi was appointed Executive Vice President and Chief Financial
Officer on December 13, 2000.
STOCK OPTION GRANTS AND EXERCISES
The following table sets forth information about options granted in 2002 to
the Named Executives. Radiologix had outstanding 2,739,427 options to purchase
Common Stock as of December 31, 2002.
OPTION GRANTS IN 2002
INDIVIDUAL GRANTS
------------------------------------------------ POTENTIAL REALIZABLE VALUE AT
NUMBER OF PERCENT OF TOTAL ANNUAL RATE OF STOCK PRICE
SECURITIES OPTIONS GRANTED EXERCISE OR APPRECIATION FOR OPTION TERM(2)
UNDERLYING TO EMPLOYEES IN BASE PRICE EXPIRATION -------------------------------
NAME OPTIONS GRANTED FISCAL YEAR ($/SH)(1) DATE 5% ($) 10% ($)
-------------------------- --------------- ---------------- ------------ ------------ -------------- --------------
Mark L. Wagar(3) ......... 75,000 27.8% $ 11.19 2/11/12 $ 527,800 $ 1,337,548
Mark S. Martin(3) ........ 50,000 18.5% $ 11.19 2/11/12 $ 351,866 $ 891,699
Sami S. Abbasi ........... 75,000 27.8% $ 11.19 2/11/12 $ 527,800 $ 1,337,548
Paul M. Jolas ............ 15,000 5.5% $ 11.19 2/11/12 $ 105,560 $ 267,510
----------
(1) The exercise price may be paid in shares of Common Stock owned by the
Named Executive, in cash, or in any other form of valid consideration
as determined by the Compensation Committee in its discretion.
(2) Dollar amounts in these columns represent the value that might be
realized upon exercise of the options immediately before they expire,
assuming that the market price of Common Stock appreciates from the
grant date at assumed annual rates of 5% and 10% (compounded annually)
until the end of the 10-year term. The Securities and Exchange
Commission prescribed the assumed appreciation rates. They are not
intended to forecast future appreciation, if any, of the price of the
Common Stock. These numbers do not take into account option provisions
for early expiration following termination of employment,
nontransferability or vesting periods.
11
(3) Mr. Wagar resigned as Chairman of the Board effective December 4,
2002, and as Chief Executive Officer in February 2003. Mr. Martin
resigned his positions with the Company in February 2003.
The following table sets forth information about options exercised in 2002
by the Named Executives.
AGGREGATED OPTION EXERCISES IN 2002 AND YEAR-END VALUES
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT FISCAL YEAR END(#) AT FISCAL YEAR END($)(2)
SHARES ACQUIRED VALUE ------------------------------- -------------------------------
NAME ON EXERCISE(#) REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------------------- --------------- -------------- -------------- -------------- -------------- --------------
Mark L. Wagar(3) ........ -- -- 569,833 179,167 0 0
Mark S. Martin(3) ....... 125,000 $ 476,314 224,999 95,001 0 0
Sami S. Abbasi .......... -- -- 90,000 185,000 0 0
Paul M. Jolas ........... 97,000 $ 1,021,085 153,416 44,584 0 0
----------
(1) The value realized equals the fair market value of the Common Stock
acquired on the date of exercise minus the exercise price.
(2) Based on the closing price of the Common Stock of $2.31 per share as
of December 31, 2002, less the option exercise price.
(3) Mr. Wagar resigned as Chairman of the Board effective December 4,
2002, and as Chief Executive Officer in February 2003. Mr. Martin
resigned his positions with the Company in February 2003.
EMPLOYMENT CONTRACTS
Radiologix has employment agreements with Messrs. Linehan, Abbasi, and
Jolas, each of whom receive annual salaries at the rate of $440,000, $286,000,
and $229,500, respectively. Until their termination of employment with
Radiologix, Radiologix also had employment agreements with Messrs. Wagar and
Martin, who received annual salaries at the rate of $442,000 and $338,000,
respectively. Each employment agreement has or had a term of one year with
automatic successive one year renewals. Each employment agreement provides that
if Radiologix terminates the employee (i) other than for cause or (ii) upon
disability, or (iii) if the employee voluntarily terminates employment due to an
adverse change in duties, Radiologix will pay the employee one year's annual
base salary at the most current rate in one lump sum, plus all accrued but
unpaid wages and expense reimbursements. If the employee's employment terminates
following a change in control transaction (as defined in the employment
agreements), then Radiologix will pay the employee two times the employee's most
recent annual base salary and two times the amount of the employee's most recent
bonus, as well as provide up to two years of other employee benefits. Each
employment agreement contains a covenant not to compete with Radiologix for a
period of one year following termination of employment.
Effective February 4, 2003, Radiologix entered into a six-month consulting
agreement with Mark L. Wagar, its former Chairman of the Board and Chief
Executive Officer. Mr. Wagar is entitled to receive $18,416.67 per month during
which he serves as a consultant to Radiologix.
Radiologix has also entered into a consulting arrangement with Derace L.
Schaffer, M.D., a member of the Board of Directors. The arrangement is described
in the "Certain Transactions" section of this proxy statement.
DIRECTOR COMPENSATION
Pursuant to the Company's Amended and Restated Bylaws, Board members may be
compensated in a manner and at a rate determined from time to time by the Board.
Directors who are Radiologix employees do not receive additional compensation
for service as a director. Under the Company's 1996 Stock Option Plan, directors
who are not Radiologix employees receive options to purchase 10,000 shares of
Common Stock per year of service. Non-employee directors are paid a monthly
retainer of $1,000 for Board service, $500 for committee service, and $250
12
for service as a committee chair. They receive $1,000 for personal attendance at
any Board or committee meeting and $500 for attendance by telephone.
Marvin S. Cadwell was appointed Chairman of the Board effective December 4,
2002. In consideration of his service as Chairman, Mr. Cadwell receives $5,000
per month. He also received an option to purchase 50,000 shares of Radiologix
Common Stock at an exercise price of $4.69, which was the closing price of the
Common Stock on the American Stock Exchange on the date the option was granted.
The option will vest for 30,000 shares on December 4, 2003, and thereafter for
833 shares per month for 24 months.
DEDUCTIBILITY OF COMPENSATION
Section 162(m) of the Internal Revenue Code limits the tax deduction of a
public company to $1,000,000 for compensation paid to its chief executive
officer or any of its four other highest paid officers. Radiologix has not
adopted a policy with respect to annual executive compensation in excess of
$1,000,000.
REPORT ON EXECUTIVE COMPENSATION
COMPENSATION PHILOSOPHY
The Compensation Committee is composed of independent directors and advisors
who are not employees of Radiologix and who qualify as disinterested persons for
purposes of Section 16(b) under the Securities Act of 1934. The Compensation
Committee is responsible for reviewing all aspects of the Company's executive
compensation programs and administering the Company's 1996 Stock Option Plan. In
addition, the Compensation Committee is responsible for reviewing and
recommending to the Board policies and programs for the development of
management personnel and management structure and organization. Members of the
Compensation Committee are Messrs. Cadwell, Farrell, and Mello. Mr. Mello chairs
Compensation Committee meetings. The Compensation Committee meets during the
fiscal year to establish target base compensation levels for the Company's
executive officers for that year and to finalize bonuses for the previous year's
performance with the concurrence of the Board.
The Compensation Committee believes that compensation for the Company's
employees, including the Named Executives, must be in amounts sufficient to
attract, retain and motivate employees, while at the same time maintaining a
productive relationship to the Company's service and financial performance.
Moreover, the Compensation Committee believes that compensation decisions should
foster career opportunities for, and aid the development of, employees and
encourage and reward employees who put the Company's interests ahead of their
own.
The Company's compensation philosophy is based on the following general
principles:
o To achieve compensation levels for employees through base salaries and
bonuses (based on Company and individual performance) to attract and
retain the most qualified individuals.
o To align employees' and stockholders' interests in maximizing
stockholder value by granting options to purchase Common Stock.
The nonemployee members of the Board of Directors performed the functions of
the Compensation Committee during the first part of 2002, when decisions
regarding compensation of the Chief Executive Officer and the other Named
Executives were made. In November 2002, Marvin S. Cadwell, Joseph C. Mello, and
Paul D. Farrell were appointed as sole members of the Compensation Committee.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER AND OTHER EXECUTIVE OFFICERS
Radiologix entered into an employment agreement with Mark L. Wagar in May
1998 upon his appointment as President and Chief Executive Officer. Mr. Wagar's
employment agreement established a base salary and provided for bonuses
determined by the Compensation Committee. The other Named Executives have
similar agreements.
13
In 2002, the Board approved salary increases for all of the Named
Executives. The salaries of Messrs. Wagar, Martin, Abbasi, and Jolas were
increased by $17,000, $13,000, $11,000, and $4,500, respectively. These
increases were based upon costs of living increases and executive performance
during 2001.
In 2002, the Board also approved option grants to all of the Named
Executives. In determining the number of shares to grant under these options,
the Board took into account the Company's performance, individual job
performance, employee morale, and the Company's desire to properly compensate
the executives. No specific weights were assigned to any of these factors.
In addition, the Company has a Company-wide cash compensation incentive
program designed to encourage all employees to focus on results that will build
sustainable value for patients, other customers and stockholders. The program
gives every employee an opportunity for additional cash compensation if results
are favorable on a variety of factors including patient satisfaction, revenue
growth, EBITDA, days sales outstanding and resource management. Senior managers
and executive officers have an additional factor related to economic value added
based on return on invested capital. No incentive payments were paid to any of
the Named Executives for fiscal year 2002 Company performance.
Radiologix has entered into an employment agreement with Stephen D. Linehan,
who was appointed President and Chief Executive Officer effective February 4,
2003. Mr. Linehan's employment agreement establishes a base salary of $440,000
per year and includes options to acquire up to 900,000 shares of the Company's
Common Stock.
2002 Compensation Committee Members:
Marvin S. Cadwell
Joseph C. Mello (Chairman)
Paul D. Farrell
STOCK PERFORMANCE GRAPH
The following graph compares the cumulative total return on the Common Stock
over the period commencing November 21, 1997 (the first day after the effective
date of the Company's initial public offering) and ending December 31, 2002,
with the Russell 2000 Index and a Peer Group Index. Each index assumes $100
invested at the close of trading on November 21, 1997, and reinvestment of
dividends.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
ASSUMES INITIAL INVESTMENT OF $100
DECEMBER 2002
(GRAPH)
1997 1998 1999 2000 2001 2002
---------- ---------- ---------- ---------- ---------- ----------
Radiologix Inc. Cum $ $ 100.00 $ 59.38 $ 41.16 $ 47.04 $ 95.49 $ 21.73
Russell 2000 Cum $ $ 100.00 $ 97.76 $ 118.64 $ 115.19 $ 118.22 $ 94.00
Peer Group Cum $ $ 100.00 $ 118.11 $ 67.43 $ 119.76 $ 127.91 $ 113.70
14
----------
(1) The peer group index includes the following companies: Alliance Imaging,
Inc., American Surgical Corporation, Ameripath, Inc., Pediatrix Medical,
Inc., Renal Care Group, Inc., Syncor International Corporation, U.S.
Oncology, Inc., and United Surgical Partners, Inc. The returns of each
company included in the peer group index have been weighted according to
its stock market capitalization at the beginning of each period included in
the graph.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
IN COMPENSATION DECISIONS
The Company's Board of Directors participated in compensation decisions
during 2002. No director is or has been an officer or employee of any entity on
which any executive officer of Radiologix or its subsidiaries serves as a
director or a member of the compensation committee.
CERTAIN TRANSACTIONS
During 2002, Advanced Radiology, P.A. (the radiology group for which Dr.
Sherman serves as Chairman) and The IDE Group, P.C. (the radiology group for
which Dr. Schaffer serves as a director) paid Radiologix $76,891,719 and
$31,476,269, respectively, in service fees pursuant to the agreements between
Radiologix and each radiology group.
Derace L. Schaffer, M.D., a member of the Board of Directors, provided
consulting services to Radiologix during March and April 2003. He received
$10,000 for each month that he provided consulting services to Radiologix. As of
the date of this proxy statement, the Board of Directors has not considered or
approved of a consulting arrangement with Dr. Schaffer for future services.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors, executive officers and beneficial owners of more than
10% of the Common Stock to file with the Securities and Exchange Commission
initial reports of ownership and reports of changes in ownership of Common Stock
and other equity securities of Radiologix. A Form 5 reporting the automatic
grant of a director stock option to Dr. Schaffer upon his re-election as
director in 2002 inadvertently was not filed for 2002. The option award has now
been reported. Based solely upon its review of copies of the forms received,
Radiologix believes that all other such reports were submitted on a timely basis
during 2002.
STOCKHOLDER PROPOSALS
Pursuant to Securities and Exchange Commission rules, stockholder proposals
must be delivered to Radiologix at its principal executive offices no later than
December 31, 2003, to be considered for inclusion in the Company's proxy
statement for the 2004 annual meeting of stockholders. Stockholder proposals
should be directed to Radiologix, Inc., 3600 JP Morgan Chase Tower, 2200 Ross
Avenue, Dallas, Texas 75201-2776, Attention: Chief Executive Officer.
GENERAL
The 2002 Annual Report to Stockholders, which includes the Company's Report
on Form 10-K, is being mailed to the stockholders with this proxy statement.
Copies of any exhibit(s) to the Form 10-K will be furnished on request and upon
payment of the Company's expenses in furnishing the exhibit(s). Any request for
exhibits should be in writing addressed to Paul M. Jolas, General Counsel,
Executive Vice President and Secretary, Radiologix, Inc., 3600 JP Morgan Chase
Tower, 2200 Ross Avenue, Dallas, Texas 75201-2776.
BY ORDER OF THE BOARD OF DIRECTORS,
Paul M. Jolas
General Counsel, Executive Vice
President and Secretary
April __, 2003
15
FORM OF PROXY CARD
Unless otherwise marked, this proxy will be voted FOR the election of the
nominees named and FOR Proposal No. 2. Please Mark Here for
Address Change or
Comments
Election of Directors SEE REVERSE SIDE
WITHHOLD NOMINEES: Marvin S. Cadwell; Paul D. Farrell; Stephen D. Linehan;
FOR all nominees listed AUTHORITY Joseph C. Mello; Derace L. Schaffer, M.D.; and
to the right (except to vote for all Michael L. Sherman, M.D.;
as marked to the nominees listed
contrary) to the right INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name in the space provided below.
Ratification of the appointment of Ernst & Young LLP as independent In their discretion, such attorneys-in-fact and
auditors of the Company for the fiscal year ending December 31, 2003 proxies are authorized to vote upon such other
business as properly may come before the meeting,
FOR AGAINST ABSTAIN including adjournment.
[ ] [ ] [ ] I will [ ] will not [ ] be attending the meeting
YOU ARE REQUESTED TO COMPLETE, DATE, SIGN,
AND RETURN THIS PROXY PROMPTLY. ALL JOINT
OWNERS MUST SIGN. PERSONS SIGNING AS
Approval of the proposed amendment to the Company's Amended and EXECUTORS, ADMINISTRATORS, TRUSTEES,
Restated Certificate of Incorporation described in the 2003 proxy CORPORATE OFFICERS, OR IN OTHER REPRESENTATIVE
statement. CAPACITIES SHOULD SO INDICATE.
FOR AGAINST ABSTAIN Date: 2003
------------------------------------,
Signature
Signature
* FOLD AND DETACH HERE *
RADIOLOGIX, INC.
3600 JP MORGAN CHASE TOWER
2200 ROSS AVENUE
DALLAS, TEXAS 75201-2776
Annual Meeting of Stockholders to be held June 10, 2003
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned stockholder(s) of Radiologix, Inc., a Delaware corporation
(the "Company"), hereby appoints Stephen D. Linehan and Paul M. Jolas, and each
of them, attorneys-in-fact and proxies of the undersigned, with full power of
substitution, to represent and to vote all shares of common stock of the Company
which the undersigned is entitled to vote at the Annual Meeting of Stockholders
to be held at 2200 Ross Avenue, 39th Floor, Dallas, Texas 75201-2776, at 8:00
A.M., local time, on Tuesday, June 10, 2003, and at any adjournment thereof.
(continued on reverse side)
Address Change/Comments (Mark the corresponding box on the reverse side)
----------------------------* FOLD AND DETACH HERE *