SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement |_| Confidential, for Use of the,
Commission Only (as permitted
by Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Amertranz Worldwide Holding Corp.
(Name of Registrant as Specified in Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
|_| $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3). |_| Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
|_| Fee paid previously with preliminary materials.
|_| Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
AMERTRANZ WORLDWIDE HOLDING CORP.
2001 MARCUS AVENUE
LAKE SUCCESS, NEW YORK 11042
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
DECEMBER 17, 1996
To the Shareholders of Amertranz Worldwide Holding Corp.:
The Annual Meeting of Shareholders of Amertranz Worldwide Holding Corp.
(the "Company") will be held at The Inn at Great Neck, 22 Cuttermill Road, Great
Neck, New York 11021, on Tuesday, December 17, 1996 at 11:00 a.m., Eastern
Daylight Time, for the following purposes:
1. To elect five directors to serve for the ensuing year and until
the election of their successors; and
2. To transact such other business as may properly come before the
meeting or any adjournments thereof.
The Board of Directors has fixed November 15, 1996 as the record date
for the determination of shareholders entitled to notice of, and to vote at, the
meeting.
By Order of the Board of Directors
Michael Barsa
Secretary
Lake Success, New York
November 15, 1996
IMPORTANT - YOUR PROXY IS ENCLOSED
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE
COMPLETE, DATE, SIGN, AND MAIL THE ACCOMPANYING FORM OF PROXY TO THE
COMPANY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE. NO POSTAGE
IS REQUIRED FOR MAILING IN THE UNITED STATES.
<PAGE>
AMERTRANZ WORLDWIDE HOLDING CORP.
2001 MARCUS AVENUE
LAKE SUCCESS, NEW YORK 11042
(516) 326-9000
PROXY STATEMENT
The accompanying proxy is solicited by the Board of Directors of
Amertranz Worldwide Holding Corp. (the "Company") in connection with the Annual
Meeting of Shareholders to be held on Tuesday, December 17, 1996, or at any
adjournments thereof, for the purposes set forth in the accompanying notice of
the meeting. The Board of Directors has fixed the close of business on November
15, 1996 as the record date (the "Record Date") for the determination of
shareholders entitled to notice of, and to vote at, the meeting. On that date,
there were outstanding 5,926,504 shares of the Company's Common Stock par value
$.01 per share (the "Shares"), exclusive of Shares held in the Company's
treasury.
Each record holder of Shares on the Record Date is entitled to one vote
for each Share held on all matters to come before the meeting, including the
election of directors. Shares may be voted in person or by proxy. The
accompanying proxy may be revoked by the person giving it at any time prior to
its being voted by filing a written notice of such revocation with the Secretary
of the Company or by attending the meeting and voting in person.
BENEFICIAL OWNERSHIP
The following table reflects the names and addresses of the only
persons known to the Company to be the beneficial owners of 5% or more of the
Shares outstanding as of the Record Date. For purposes of calculating beneficial
ownership, Rule 13d-3 of the Securities Exchange Act of 1934 requires inclusion
of Shares that may be acquired within sixty days of the Record Date. Unless
otherwise indicated in the footnotes to this table, beneficial ownership of
shares represents sole voting and investment power with respect to those Shares.
Name and Address Shares Beneficially Percent
of Beneficial Owner Owned of Class
Wrexham Aviation Corp.(1)(2) 2,780,370 46.9%
112 East 25th Street
Baltimore, Maryland 21218
TIA, Inc.(1)(2)(3) 2,780,370 46.9%
112 East 25th Street
Baltimore, Maryland 21218
Richard A. Swirnow(1)(2)(3) 2,780,370 46.9%
112 East 25th Street
Baltimore, Maryland 21218
Caribbean Freight System, Inc.(1)(2)(3) 420,000 7.1%
112 East 25th Street
Baltimore, Maryland 21218
1
<PAGE>
(1) Represents all of the Shares owned or controlled by TIA, Inc. ("TIA")
and Caribbean Freight System, Inc. ("CFS"). See footnote 2. Swirnow
Airways Corp. ("Swirnow Airways") owns the majority interest in Wrexham
Aviation Corp. ("Wrexham"). Stuart Hettleman, a Director and President
of the Company, is an executive officer and non-controlling stockholder
of Swirnow Airways and an executive officer of Wrexham. Richard A.
Swirnow is, indirectly, the controlling stockholder of Swirnow Airways.
(2) Includes (i) 420,000 Shares owned by CFS, and (ii) 580,370 Shares with
respect to which TIA and CFS have been granted proxies. (See footnote
3, below). 51% of the issued and outstanding stock of CFS, and voting
control of all of the issued and outstanding shares of CFS, is held by
TIA. Ninety percent of the issued and outstanding stock of TIA is owned
and controlled by Wrexham. In addition, Stuart Hettleman and Richard A.
Faieta, executive officers of the Company, are executive officers of
TIA and CFS and Mr. Faieta is a non-controlling stockholder of TIA.
Messrs. Hettleman and Faieta disclaim beneficial ownership of all
Shares owned by TIA and CFS and do not share voting and/or investment
power over the Shares owned by TIA and CFS.
(3) Michael Barsa, a director and executive officer of the Company, Bruce
Brandi, and executive officer of the Company, and certain other
stockholders have granted to TIA and CFS irrevocable proxies to vote an
aggregate of 580,370 Shares for control of the Company's Board of
Directors until certain Company obligations to TIA and CFS have been
repaid. As a result, TIA and CFS may retain the right to vote these
Shares owned by those shareholders until at least February 6, 2001.
ELECTION OF DIRECTORS
At the 1996 Annual Meeting, five directors will be elected to hold
office for the ensuing year and until their successors are elected and qualify.
Under Delaware law and the Company's By-laws, (i) a quorum for the Annual
Meeting consists of a majority of the issued and outstanding Shares present in
person or by proxy and entitled to vote, and (ii) directors are elected by a
plurality of the votes of the Shares present in person or by proxy and entitled
to vote. Consequently, withholding of votes, abstentions and broker non-votes
with respect to Shares otherwise present at the Annual Meeting in person or by
proxy will have no effect on the outcome of this vote.
Unless otherwise specified in the proxy, it is the present intention of
the persons named in the accompanying form of proxy to vote such proxy for the
election as directors of the five nominees listed below. Pursuant to the
Company's By-laws, the five nominees were nominated by the Board of Directors.
If, due to unforeseen contingencies, any of the nominees designated below shall
not be available for election, the persons named in the accompanying form of
proxy reserve the right to vote such proxy for such other person or persons as
may be nominated for director by the management of the Company so as to provide
a full Board. Management has no reason to believe that any nominee will be
unable to serve if elected.
<TABLE>
<CAPTION>
Principal Occupation Director
Name Age During the Last Five Years Since
<S> <C> <C> <C> <C> <C> <C>
Michael Barsa 51 Vice President and Secretary of the 1996
Company since February 1996;
Executive Vice President and Chief
Financial Officer of Amertranz Worldwide,
Inc., September 1994 through February 1996;
Senior Vice President of All-state Legal Supply
Company from 1989 through September 1994
2
<PAGE>
Brian K. Coventry 31 Vice President (since January 1996) and Assistant --
Vice President (December 1993 through December
(1995), Corporate Finance, GKN Securities, Inc.; Associate,
Private Placements, Kemper Securities, Inc., May 1993
through December 1993; Assistant Vice President,
Leveraged Funding Group, Heller Financial, Inc., June
1992 through April 1993; Associate Investment Manager,
Corporate Finance Division, Westinghouse Credit Corp.,
1988 through May 1992
Richard A. Faieta 50 Executive Vice President of the Company since 1996
February 1996; President and Chief Executive
Officer of TIA and CFS since April 1992;
Vice President-Operations of LEP Profit
International Corporation (a domestic and
international freight forwarder) from 1987
through 1991
Stuart Hettleman 46 President, Chief Executive Officer and Chief 1996
Financial Officer of the Company since
February 1996; Vice President of TIA
since 1990; Executive Vice President
of CFS since 1991
Richard A. Swirnow 62 Chairman of TIA since 1990; Chairman and --
President of Wrexham Aviation Corp. since 1990;
Chairman and President of Swirnow Airways Corp.
since 1981; Chairman and President of Harborview
Properties Development Company since 1986
</TABLE>
During the period from the Company's formation in January, 1996 through
the fiscal year end on June 30, 1996, the Board of Directors met informally many
times but all actions were taken by unanimous written consent.
Committees of the Board of Directors
In the fiscal year ended June 30, 1996, the Company did not have any
standing audit, nominating or compensation committees of the Board of Directors,
or committees performing similar functions.
Compliance With Section 16(a) of the Exchange Act
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires that the Company's directors and executive officers and each person who
owns more than 10% of the Company's Shares, file with the Securities and
Exchange Commission an initial report of beneficial ownership and subsequent
reports of changes in beneficial ownership of the Shares. To the Company's
knowledge, all reports required to be so filed by such persons have been filed
on a timely basis. The Company believes that all of its directors and executive
officers, and all person owning beneficially more than 10% of the Shares,
complied with all filing requirements applicable to them with respect to
transactions during the fiscal year ended June 30, 1996.
3
<PAGE>
Director Compensation
During the Company's fiscal year ended June 30, 1996, each director was
an officer of the Company and received no additional compensation for serving as
a director. There is currently no plan to compensate any outside director for
attendance at meetings.
Compensation Committee Interlocks and Insider Participation
During the fiscal year ended June 30, 1996, the Company did not have a
compensation committee, and all deliberations concerning executive officer
compensation and all determinations with respect thereto were made by the
Company's Board of Directors consisting of Messrs. Barsa, Faieta and Hettleman,
each of whom was an executive officer of the Company.
INFORMATION REGARDING SHARE OWNERSHIP OF MANAGEMENT
The following table sets forth information with respect to the
beneficial ownership of the Shares as of the Record Date by (i) each executive
officer of the Company named in the Summary Compensation Table included
elsewhere in this Proxy Statement, (iii) each current director and each nominee
for election as a director and (iv) all directors and executive officers of the
Company as a group. For purposes of calculating beneficial ownership, Rule 13d-3
of the Securities Exchange Act of 1934 requires inclusion of Shares that may be
acquired within sixty days of the Record Date. Unless otherwise indicated in the
footnotes to this table, beneficial ownership of shares represents sole voting
and investment power with respect to those Shares.
<TABLE>
<CAPTION>
Name of Beneficial Owner Shares Beneficially Owned Percent of Class
<S> <C> <C> <C> <C> <C> <C>
Richard A. Swirnow(1)(2)(3) 2,780,370 46.9%
Michael Barsa(3)(4) 281,010 4.7%
Bruce Brandi(3)(5) 35,761 0.6%
Stuart Hettleman(2) 20,834 0.4%
Richard A. Faieta(2) 20,834 0.4%
Brian K. Coventry 0 --
All directors and executive officers
as a group (4 persons)(1)(2)(3)(4)(5) 2,939,770 49.6%
<FN>
(1) See footnote (1) under "Beneficial Ownership".
(2) See footnote (2) under "Beneficial Ownership".
(3) See footnote (3) under "Beneficial Ownership".
(4) Includes options to purchase 154,477 Shares.
(5) Includes options to purchase 28,393 Shares.
</FN>
</TABLE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the cash compensation, as well as
certain other compensation, paid or accrued by the Company during the fiscal
year ended June 30, 1996 to the Chief Executive Officer and each of the four
other most highly compensated executive officers of the Company officer for
their services in all capacities since the formation of the Company on February
7, 1996.
4
<PAGE>
<TABLE>
<CAPTION>
Name and Principal Position Salary(1) Number of Options
<S> <C> <C> <C> <C> <C> <C>
Stuart Hettleman..............................................
Chief Executive Officer and Chief Financial Officer....... $ -- 75,000(2)
Richard A. Faieta.............................................
Executive Vice President.................................. $59,375 75,000(2)
Michael Barsa.................................................
Vice President and Secretary.............................. $53,438 154,477
Bruce Brandi..................................................
President of Amertranz Worldwide, Inc.
(the Company's wholly-owned subsidiary)................... $59,261 42,590
<FN>
(1) While the named executive officers enjoyed certain perquisites for
fiscal year ended June 30, 1996, these did not exceed the lesser of
$50,000 or 10% of each officers' salary and bonus.
(2) See footnote (3) to "Option Grants in Last Fiscal Year" table, below.
</FN>
</TABLE>
Option Grants in Last Fiscal Year
The following table sets forth information with respect to the grant of
stock options during the Company's fiscal year ended June 30, 1996 to the
executive officers named in the Summary Compensation Table:
<TABLE>
<CAPTION>
Potential Realizable Value At Assumed
Individual Grants Annual Rates of Stock Price
Appreciation for Option Term(1)
% of Total
Options Exercise
No. of Granted to or Base
Options Employees in Price Expiration
Name Granted Fiscal Year ($/Share) Date 0%(2) 5% 10%
- ---- ------- ----------- --------- ------ -- -- ---
<S> <C> <C> <C> <C> <C> <C> <C>
Stuart Hettleman............ 75,000(3) 15.1% $6.00 6/28/06 -- $22,500 $45,000
Richard A. Faieta........... 75,000(3) 15.1% $6.00 6/28/06 -- $22,500 $45,000
Michael Barsa............... 154,477 31.1% $.408 2/7/99 $275,278 $292,193 $309,108
Bruce Brandi(4)............. 42,590 8.6% $0.16 10/10/04 $86,458 $91,121 $95,785
<FN>
(1) The 5% and 10% assumed rates of appreciation are mandated by the rules
of the Securities and Exchange Commission and do not represent the
Company's estimate or projection of the future Common Stock price.
(2) Denotes realizable value at the date of grant which reflected a market
value of $2.19 per share, as determined by the Company's Board of
Directors.
(3) 20,834 of such options are currently exercisable, and 16,666 of such
options become exercisable on January 2, 1997. 18,750 of such options
become exercisable at any time after January 1, 1998, if the Company's
EBITDA for its fiscal year ending June 30, 1997 exceeds $500,000
provided, that if the Company's EBITDA for its fiscal year ended June
30, 1997 does not exceed $500,000 but its EBITDA for its fiscal year
ended June 30, 1998 exceeds $750,000, such options shall be exercisable
commencing on the date the Company's EBITDA for its fiscal year ended
June 30, 1998 has been determined. 18,750 of such options become
exercisable at any time after January 1, 1999, if the Company's EBITDA
for its fiscal year ended June 30, 1998 exceeds $750,000.
(4) 28,393 of such options have vested and are currently exercisable, and
an additional 14,197 of such options vest and become exercisable on
each of October 10, 1997.
</FN>
</TABLE>
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option
Values
The following table sets forth, for each of the executive officers
named in the Summary Compensation Table, information with respect to the
exercise of stock options during 1996 and holdings of unexercised options at the
end of the fiscal year:
5
<PAGE>
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised
Options/SARs in-the-Money Options/SARs
Name at Fiscal Year End at Fiscal Year End($)(1)
Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Stuart Hettleman............................ 0 75,000 0 $46,875
Richard A. Faieta........................... 0 75,000 0 $46,875
Michael Barsa............................... 154,477 0 $960,384 0
Bruce Brandi................................ 28,393 14,197 $183,561 $91,784
- ----------------------------------
<FN>
(1) Based on the excess of (i) the aggregate market value (closing price on
the NASDAQ SmallCap Market) of the underlying shares on June 28, 1996
over (ii) the aggregate exercise price of the options.
</FN>
</TABLE>
Executive Employment Agreements
Stuart Hettleman and Richard A. Faieta each entered into an employment
agreement with the Company effective July 3, 1996. Each such employment
agreement provides that the respective officers are employed for a period of
three years (subject to renewal for successive three-year periods) at an annual
base salary of $130,00 and $150,000 for Mr. Hettleman and Mr. Faieta,
respectively. The base salary will increase on each anniversary of the
respective employment agreements by an amount equal to .5% of the then current
base salary for each $100,00 of the Company's earnings before interest, taxes,
depreciation and amortization ("EBITDA") for the fiscal year ended prior to such
anniversary date. Furthermore, each such officer is entitled to incentive
compensation in excess of base salary for each fiscal year of the Company during
the term of employment, in an amount equal to 1% of the base salary in effect at
the end of such fiscal year for each $100,000 of the Company's EBITDA for such
fiscal year. Each such officer has also been granted an option to purchase
75,000 shares of Common stock pursuant to the company's Stock Option Plan. If
either officer's employment agreement is terminated by the Company other than
for cause or if the officer elects to terminate employment following either (i)
a material breach of the agreement by the Company, (ii) failure by the Company
to offer renewal of the employment agreement at its expiration upon terms at
least as favorable as those in effect at that time, or (iii) an event generally
constituting a change in control of the Company, such officer shall be entitled
to receive one of the following, (at the officer's election):(a) all
compensation and benefits under the agreement for the balance of the term, (b)
299% of the sum of the base salary and incentive compensation paid to him in
respect of the fiscal year ended prior to termination, or (c) the present value
of his base salary and incentive compensation payable for the balance of the
term of the agreement (assuming certain increases in base salary and levels of
incentive compensation over the balance of the term of the agreement). In
addition, all unexercisable stock options will thereupon become immediately
exercisable. Each employment agreement generally prohibits the officer from
soliciting directly or indirectly, any existing customer or employee of the
Company for a period of two years following termination of employment.
Pursuant to the terms of an Employment Agreement dated September 26,
1994, as amended February 7, 1996, Bruce Brandi is employed by Amertranz
Worldwide, Inc., the Company's wholly-owned subsidiary ("Amertranz") for a term
of three years commencing October 10, 1994. The employment agreement provides
for an annual salary of $150,000, with an increase of $7,500 on the second
anniversary date. During 1995, Mr. Brandi deferred $30,250 of his salary which
amount will be paid by February, 1999. The employment agreement provides that if
Mr. Brandi is discharged for cause he may not solicit, directly or indirectly,
any existing customer or employee of the Company for a period of two years. If
the Company terminates Mr. Brandi's employment for any other reason, it may
enforce these restrictions if it continues to pay his salary.
6
<PAGE>
REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
The Company commenced operations in 1996. For the fiscal year ended
June 30, 1996, the compensation of the Company's executive officers was
determined by the Board of Directors.
Compensation Philosophy. The philosophy of the Board with respect to
executive compensation is to ensure that the interests of management and
employees are identical to the interests of the Company's owners - the
shareholders. To that end, the Board has implemented and will continue to
implement a compensation strategy that includes base salary and cash bonus, as
well as incentive stock options which will reward management for adding
shareholder value. Base salary has been established at levels which are
necessary to attract and retain a high caliber of management, and cash bonuses
are designed to provide short-term rewards for current accomplishments.
Incentive stock options provide management with a long-term investment in the
Company, the value of which is dependent upon their success in maximizing
shareholder values.
This approach to employee remuneration carries through to salary and
incentive compensation for the Company's non-management personnel, as well. The
Company's 1996 Stock Option Plan is designed to reward the Company's valuable
employees for their individual contributions to the profitability of the Company
and provide them with a long-term interest in the Company's success.
The compensation of Messrs. Hettleman and Faieta, as the President and
Executive Vice President of the Company, respectively, is based upon the overall
performance of the Company and its management. As the senior management, these
individuals are responsible for the overall condition of the Company, and their
performance is rewarded on objective criteria based on reaching certain
financial benchmarks.
It is the intention of the Board to review the Company's executive
compensation structure to insure that the Company has the continued ability to
attract and retain the high caliber executive talent. To that end, the Board
will take into account salaries of senior management of companies of similar
size within the freight forwarding industry.
Base Salary. Base salary for senior management for fiscal year 1996 was
based upon salaries paid to such personnel in the preceding year, as senior
management of the Company's predecessors.
Salary Increases and Incentive Bonuses. Salary increases and incentive
bonuses for senior management during the terms of their respective employment
agreements are dependent on the Company's financial performance.
Stock Option Plan. To promote the best long-term benefits to the
Company and its shareholders, the Company has a 1996 Stock Option Plan ("Plan")
under which directors, officers and employees may be granted awards of stock
options. The purpose of the Plan is to provide equity-based incentive
compensation based on the long-term appreciation in value of the Company's
Shares and to promote the interests of the Company and its shareholders by
encouraging greater management ownership of the Company's Shares. Most of the
options granted or to be granted under the Plan vest over a period of several
years, thereby providing a long-term incentive and encouraging a long-term
relationship between the employee and the Company.
Awards under the Plan will be made to employees who have demonstrated
significant management potential or who have the capacity for contributing in a
substantial measure to the successful performance of the Company. Currently, a
maximum of 402,348 Shares may be issued under the Plan, options to purchase
300,000 of which have been granted.
BOARD OF DIRECTORS
Stuart Hettleman
Richard A. Faieta
Michael Barsa
7
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on
the Company's Shares for the period June 28, 1996 through September 30, 1996
with the cumulative total return for the same period for the NASDAQ Composite
(U.S.) Index and a peer group index comprised of: Eagle USA Air Freight, Inc.,
The Harper Group, Inc., Air Express International Corporation, Fritz Companies,
Inc., and Pittston Burlington, Inc. Dividend reinvestment has been assumed and,
with respect to the companies in the peer group, the returns of each company
have been weighted to reflect its stock market capitalization relative to that
of the other companies in the group. The Company's Shares commenced trading on
June 28, 1996, and, consequently, the Shares traded for only one day during the
Company's fiscal year ended June 30, 1996. Other than the following graph, all
information in this Proxy Statement, including executive compensation, is with
respect to the Company's fiscal year ended June 30, 1996. Accordingly, the
information presented in the following graph does not relate to the other
information presented in this Proxy Statement.
TOTAL RETURN TO STOCKHOLDERS
(Assumes $100 investment on June 28, 1996)
[PERFORMANCE GRAPH]
- ------------------------------------------------------------------------------
Total Return Analysis
6/28/96 9/30/96
- ------------------------------------------------------------------------------
Amertranz Worldwide Holding Corp. $100.00 $ 87.50
- ------------------------------------------------------------------------------
Peer Group $100.00 $ 76.82
- ------------------------------------------------------------------------------
Nasdaq Composite $100.00 $103.59
- ------------------------------------------------------------------------------
Source: Carl Thompson Associates. Data from Bloomberg Financial Markets
8
<PAGE>
CERTAIN RELATIONSHIPS AND TRANSACTIONS
TIA Loan
Commencing in October, 1995, Amertranz received advances aggregating
$800,000 pursuant to a loan from TIA, Inc. ("TIA Loan"). The TIA Loan bears
interest at the rate of 12% per annum and is repayable in 12 equal, consecutive
monthly payments of principal and interest commencing upon the earlier of (i)
the date after which the Company's EBITDA exceeds the sum of $600,000 for any
consecutive two-month period, or (ii) November 1, 1996.
In February 1996, pursuant to the terms of an Assets Exchange Agreement
("Exchange Agreement") TIA and CFS contributed their freight forwarding business
to the Company (which the Company contributed to its wholly owned subsidiary,
Caribbean Air Services, Inc. ("CAS")) in consideration for 2,100,000 Shares and
a note in the original principal amount of $10,000,000 ("Exchange Note") bearing
interest at the rate of 8% per annum. In June 1996 TIA and CFS exchanged
$2,000,000 principal amount of the Exchange Note for 200,000 shares of the
Company's Class A Preferred Stock reducing the principal balance to $8,000,000.
On July 3, 1996 the Company paid $2,000,000 of the proceeds from the Company's
initial public offering ("IPO") to reduce the principal balance to $6,000,000.
The Exchange Note is payable in five consecutive monthly payments of principal
and interest in the amount of $80,000 each and, thereafter, monthly payments of
principal and interest in the amount of $166,667 each until the Exchange Note is
paid in full commencing on the earlier of (i) the date after which the Company's
EBITDA exceeds the sum of $600,000 for any consecutive two-month period, or (ii)
November 1, 1996.
As part of the transaction in February 1996 whereby TIA and CFS
contributed their freight forwarding assets to the Company (the "Combination"),
TIA and CFS also agreed to advance to CAS, on a revolving loan basis, an amount
up to the net collections of TIA's and CFS's accounts receivable as of February
7, 1996 and additional amounts in the discretion of TIA and CFS, up to an
aggregate maximum of $4,000,000 outstanding at any time, pursuant to the terms
of a Revolving Credit Promissory Note ("Revolver Note"). Funds advanced under
the Revolver Note with respect to the TIA and CFS accounts receivable do not
bear interest prior to maturity. Discretionary advances under the Revolver Note
bear interest at the greater of (i) 1% per month, or (ii) a fluctuating rate
equal to the prime rate of interest as published in the Wall Street Journal plus
4%. The Revolver Note is payable upon the earlier of (i) refinancing of
Amertranz and CAS' accounts receivable working capital facilities, or (ii)
December 31, 1996.
To secure the obligations under the TIA loan, Exchange Note and
Revolver Note, TIA and CFS have been granted security interests in all of the
assets of the Company and CAS and in the accounts receivable of Amertranz. All
of the security interests are first priority, except for the security interest
in Amertranz' accounts receivable which is subordinated only to the lien of
Amertranz' asset based lender.
Under the terms of Cargo Aircraft Charter Agreement dated February 28,
1994, as amended, (the "L-1011 Charter"), CAS has exclusive rights, until June
30, 1998, to the use of a Lockheed L-1011 freighter aircraft that is operated on
behalf of Tradewinds Airlines, Inc. ("Tradewinds Air") between the Company's
Borinquen, Puerto Rico location and its Greensboro, North Carolina and Hartford,
Connecticut locations. Under the terms of the L-1011 Charter, the L-1011
aircraft must be available at all times for use by the Company, as needed. While
the Company is guaranteed the use of the L-1011 aircraft as needed, the Company
pays only for its actual use of the aircraft at market rates. Under the terms of
the Exchange Agreement, all of the Company's freight between Puerto Rico and the
continental United States must be transported on the L-1011 aircraft pursuant to
the L-1011 Charter unless TIA and CFS consent to other transport, and the L-1011
Charter may not be terminated without the consent of TIA and CFS. The L-1011
aircraft is operated by TIA under its U.S. Department of Transportation licenses
and authority pursuant to an operating agreement between TIA and Tradewinds Air.
Payments to Tradewinds Air under the L- 1011 Charter during the year ended June
30, 1996 totalled $7,575,000. Tradewinds Air is owned by Tradewinds Acquisition
Corporation, of which TIA owns approximately 30%. To date, Tradewinds
Acquisition Corporation has
9
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not paid any dividends, but to the extent it ever pays any dividends or makes
any other distributions, TIA will benefit from such dividends and/or
distributions.
Between June 1995 and November 1995, Amertranz borrowed $1,379,110 in
aggregate principal amount from persons affiliated with Amertranz, including
Michael Barsa and his brother, and issued (i) $1,096,610 in aggregate principal
amount of promissory notes with interest at the rate of 7% per annum, due June
30, 1996, and (ii) $282,500 in aggregate principal amount of promissory notes
with interest at the rate of 9 3/4% per annum, due August 15, 1996. In addition,
certain of these lenders received an aggregate of 54,657 options to purchase
shares of Amertranz common stock at $3.52 per share, 47,559 of which options
were exercised prior to the Combination. As part of the transactions under the
Exchange Agreement, the holders of all of these promissory notes assigned to the
Company their notes and the shares of Amertranz common stock which were issued
upon the exercise of such options in exchange for an aggregate of 363,669 shares
of Common Stock, and the holders of unexercised Amertranz options exchanged such
options for an aggregate of 181,809 options to purchase the Company's Shares.
In a bridge financing concluded by the Company in May 1996, (i) TIA
received 100,000 Shares and 200,000 Share purchase warrants for an aggregate
loan to the Company of $500,000, and (ii) Michael Barsa received 25,000 Shares
and 50,000 Share purchase warrants for an aggregate loan to the Company of
$125,000. Both these loans were repaid with aggregate interest of $13,870 from
the proceeds of the IPO.
All transactions between the Company and its officers, directors,
principal shareholders or other affiliates have been on terms no less favorable
than those that are generally available from unaffiliated third parties. Any
such future transactions will be on terms no less favorable to the Company than
could be obtained from an unaffiliated third party on an arms length basis and
will be approved by a majority of the Company's independent and disinterested
directors.
OTHER MATTERS
The Board of Directors is not aware of any other matter which may be
presented for action at the Annual Meeting, but should any other matter
requiring a vote of the shareholders arise, it is intended that the proxies will
be voted with respect thereto in accordance with the best judgment of the person
or persons voting the proxies, discretionary authority to do so being included
in the proxy.
The cost of soliciting proxies will be borne by the Company.
Arrangements will be made with brokerage firms and other custodians, nominees
and fiduciaries to forward solicitation materials to the beneficial owners of
the Shares held of record by such persons, and the Company will reimburse them
for their reasonable out-of-pocket expenses. Officers and directors may also
solicit proxies.
The Board of Directors has selected the firm of Arthur Andersen LLP as
the Company's independent public accountants for the current fiscal year. Arthur
Andersen LLP has served as the Company's independent public accountants since
inception. Representatives of Arthur Andersen LLP are expected to be present at
the meeting, and will have the opportunity to make a statement if they desire to
do so and to respond to appropriate questions.
The five nominees for election as directors who receive a plurality of
the votes cast at the Annual Meeting for the election of directors will be
elected. In respect of any other matter, the affirmative vote of the holders of
a majority of the shares present at the meeting, in person or by proxy, and
entitled to vote in respect of that matter is necessary to approve the matter.
As a matter of policy, the Company will accord confidentiality to the
votes of individual shareholders, whether submitted by proxy or ballot, except
in limited circumstances, including any contested election, or as may be
necessary to meet legal requirements. The Company will retain an independent
tabulator to receive and tabulate the proxies and ballots and independent
inspectors of election to certify the results.
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Any shareholder desiring to present a proposal at the 1997 Annual
Meeting of Shareholders and wishing to have that proposal included in the Proxy
Statement for that meeting must submit the same in writing to the Secretary of
the Company at 2001 Marcus Avenue, Lake Success, New York 11040 in time to be
received by June 1, 1997.
Shareholders who do not plan to attend the Annual Meeting are urged to
complete, date, sign and return the enclosed proxy in the enclosed envelope, to
which no postage need be affixed if mailed in the United States.
Prompt response is helpful and your cooperation will be appreciated.
By Order of the Board of Directors
Michael Barsa
Secretary
Lake Success, New York
November 15, 1996
THE COMPANY WILL FURNISH, WITHOUT CHARGE, A COPY OF ITS ANNUAL REPORT
ON FORM 10-K FOR THE YEAR ENDED JUNE 30, 1996, TO EACH SHAREHOLDER WHO FORWARDS
A WRITTEN REQUEST TO THE SECRETARY, AMERTRANZ WORLDWIDE HOLDING CORP., 2001
MARCUS AVENUE, LAKE SUCCESS, NEW YORK 11042.
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PROXY
AMERTRANZ WORLDWIDE HOLDING CORP.
2001 Marcus Avenue
Lake Success, New York 11042
This Proxy is Solicited on Behalf of the Board of Directors of
Amertranz Worldwide Holding Corp. The undersigned hereby appoints Stuart
Hettleman and Richard A. Faieta, and each of them, as proxies, each with the
power of substitution, to vote as designated below all of the shares the
undersigned is entitled to vote at the Annual Meeting of Shareholders to be held
at the Inn at Great Neck, Cuttermill Road, Great Neck, New York, on December 17,
1996 at 11:00 a.m., prevailing local time, and any adjournments thereof.
1. ELECTION OF DIRECTORS: FOR all nominees listed below []
(except as set forth to the contrary below)
WITHHOLD AUTHORITY to vote for all nominees listed below []
Michael Barsa, Brian K. Coventry, Richard A. Faieta, Stuart Hettleman,
Richard A. Swirnow
The terms of all Directors expire at the next annual meeting at which their
successors are elected and qualify.
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below.)
- ----------------------------------------------------------------------
2. In their discretion, the proxies are authorized to vote upon any other
business which properly comes before the meeting and any adjournments
thereof.
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[REVERSE SIDE OF PROXY CARD]
This proxy, when properly executed, will be voted in the manner directed hereby
by the undersigned shareholders. If no direction is made, this proxy will be
voted in favor of all nominees.
Please sign exactly as your name appears on your proxy card. When shares are
held by joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by the President or other
authorized officer. If a partnership, please sign in partnership name by an
authorized person.
PLEASE MARK, SIGN, DATE AND MAIL THE
CARD IN THE ENCLOSED ENVELOPE.
DATED: __________________________, 1996
Signature______________________________________
DATED: __________________________, 1996
Signature______________________________________
C66488.198 R
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