<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] $125 per Exchange Act Rule 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.
[ ] 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.
<PAGE> 2
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
5025 DERRICK JONES ROAD
SUITE 120
ATLANTA, GEORGIA 30349
April 15, 1998
TO OUR SHAREHOLDERS:
You are cordially invited to attend the 1998 Annual Meeting of
Shareholders (the "Annual Meeting") of Professional Transportation Group Ltd.,
Inc. (the "Company"). The Annual Meeting will be held at the offices of Nelson
Mullins Riley & Scarborough, L.L.P., First Union Plaza, 999 Peachtree St., N.E.,
Suite 1400, Atlanta, Georgia 30309 on Friday, May 22, 1998, at 10:00 a.m., local
time. The attached Notice of Annual Meeting and Proxy Statement describe the
formal business expected to be transacted at the Annual Meeting. In addition to
the specific matters to be acted upon, there also will be a report on the
operations of the Company, and directors and officers of the Company will be
present to respond to your questions.
Included with the Proxy Statement is a copy of the Company's Annual
Report to Shareholders, which includes the Company's Annual Report on Form
10-KSB. We encourage you to read the Annual Report. It includes the Company's
audited financial statements for the year ended December 31, 1997 as well as
information on the Company's operations, markets and services.
Please use this opportunity to take part in the affairs of the Company
by voting on the business to come before this Annual Meeting. WHETHER OR NOT YOU
PLAN TO ATTEND THE ANNUAL MEETING, YOU ARE REQUESTED TO MARK, SIGN, DATE AND
PROMPTLY RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED. Returning the proxy
does NOT deprive you of your right to attend the Annual Meeting and to vote your
shares in person for the matters acted upon at the Annual Meeting.
We look forward to seeing you at the Annual Meeting.
Sincerely,
Dennis A. Bakal
Chairman of the Board of Directors,
Chief Executive Officer and President
<PAGE> 3
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
5025 DERRICK JONES ROAD
SUITE 120
ATLANTA, GEORGIA 30349
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FRIDAY, MAY 22, 1998
TO OUR SHAREHOLDERS:
NOTICE IS HEREBY GIVEN THAT the 1998 Annual Meeting of Shareholders
(the "Annual Meeting") of Professional Transportation Group Ltd., Inc., a
Georgia corporation (the "Company"), will be held at the offices of Nelson
Mullins Riley & Scarborough, L.L.P., First Union Plaza, 999 Peachtree St., N.E.,
Suite 1400, Atlanta, Georgia 30309, on Friday, May 22, 1998, at 10:00 a.m.,
local time, for the following purposes:
1. to elect five directors;
2. to consider and act upon the proposal to amend the Company's
1996 Stock Option Plan to increase the shares reserved for
issuance thereunder from 1,500,000 to 2,000,000 and other
matters therein;
3. to consider and act upon the proposal to adopt the Company's
1998 Employee Stock Purchase Plan; and
4. to transact such other business as may properly come before
the Annual Meeting or any adjournment thereof.
Only shareholders of record at the close of business on April 10, 1998
are entitled to notice of, and to vote at, the Annual Meeting and at any
continuation or adjournment thereof. In accordance with the Georgia Business
Corporation Code (the "Georgia Law"), a list of shareholders entitled to vote at
the Annual Meeting shall be open to the examination of any shareholder, his
agent or attorney for any purpose germane to the Annual Meeting upon written
notice, all as provided by the Georgia Law, and the list shall be available for
inspection at the Annual Meeting by any shareholder that is present.
By Order of the Board of Directors,
LINDA K. ROBERTS
SECRETARY
Atlanta, Georgia
April 15, 1998
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE, SIGN,
DATE AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE AS
PROMPTLY AS POSSIBLE.
<PAGE> 4
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
5025 DERRICK JONES ROAD
SUITE 120
ATLANTA, GEORGIA 30349
PROXY STATEMENT FOR ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON FRIDAY, MAY 22, 1998
This Proxy Statement and the accompanying Notice of Annual Meeting and
Proxy Card are being furnished to the shareholders of Professional
Transportation Group Ltd., Inc., a Georgia corporation (the "Company"), in
connection with the solicitation of proxies by the Board of Directors (the
"Board") of the Company for use at the 1998 Annual Meeting of Shareholders (the
"Annual Meeting"). The Annual Meeting will be held on Friday, May 22, 1998 at
10:00 a.m., local time, at the offices of Nelson Mullins Riley & Scarborough,
L.L.P., First Union Plaza, 999 Peachtree St., N.E., Suite 1400, Atlanta, Georgia
30309.
VOTING RIGHTS AND VOTES REQUIRED
All shareholders of record of the Company's common stock, no par value
per share (the "Common Stock"), on April 10, 1998, the record date, will be
entitled to vote at the Annual Meeting or any continuation or adjournment
thereof. At the close of business on the record date, the Company had 3,867,850
shares of Common Stock outstanding and entitled to vote. A majority of the
outstanding shares of Common Stock will constitute a quorum for the transaction
of business at the Annual Meeting. Each holder of record of Common Stock on the
record date is entitled to one vote for each share of Common Stock so held on
each matter to be voted upon at the Annual Meeting. This Proxy Statement and the
accompanying Notice of Annual Meeting, Proxy Card and the Company's Annual
Report to Shareholders were first mailed to the shareholders on or about April
15, 1997.
The five directors to be elected at the Annual Meeting will be elected
by the affirmative vote of the holders of a plurality of the shares of Common
Stock represented at the Annual Meeting in person or by proxy. Because the
directors will be elected by a plurality vote (i.e., the five persons receiving
the highest number of favorable votes will be elected) and assuming such
election is uncontested, votes withheld from any one or more nominees will not
have any effect on the outcome of the election of directors.
Approval and ratification of the amendments to the Company's 1996 Stock
Option Plan, (the "Plan") and approval and ratification of the adoption of the
Company's 1998 Employee Stock Purchase Plan (the "Purchase Plan"), and actions
with respect to any other matter that may properly come before the Annual
Meeting will require the affirmative vote of the holders of a majority of the
shares of Common Stock represented at the Annual Meeting in person or by proxy
and entitled to vote on the matter. Abstentions will be counted in determining
the total number of shares present and entitled to vote on each such proposal.
Accordingly, although not counted as a vote "for" or "against" a proposal, an
abstention on any such proposal will have the same effect as a vote "against"
that proposal.
<PAGE> 5
APPOINTMENT AND REVOCATION OF PROXIES
The Board has designated Dennis A. Bakal and Linda K. Roberts, and each
or either of them, as proxies to vote the shares of Common Stock solicited on
its behalf. If the Proxy Card is executed and returned, it may nevertheless be
revoked at any time before it has been exercised by: (i) giving written notice
to the Secretary of the Company; (ii) delivery of a properly completed later
dated proxy; or (iii) attending the Annual Meeting and voting in person. Such
notice or later proxy will not affect a vote on any matter taken prior to the
receipt thereof by the Company or its transfer agent. The mere presence at the
Annual Meeting of the shareholder who has appointed a proxy will not revoke the
prior appointment. If not revoked, the proxy will be voted at the Annual Meeting
in accordance with the instructions indicated on the Proxy Card by the
shareholder or, if no instructions are indicated, will be voted FOR the slate of
directors described herein, FOR the proposal to amend the Plan, FOR the proposal
to adopt the Purchase Plan, and as to any other matter that may be properly
brought before the Annual Meeting, in accordance with the judgment of the proxy
holders.
EXPENSES OF SOLICITATION
The expense of soliciting proxies will be borne by the Company. The
Company does not expect to pay any compensation for the solicitation of proxies
but may reimburse brokers and other persons holding stock in their names, or in
the names of nominees, for their expenses for sending proxy material to
principals and obtaining their proxies. Certain directors, officers and other
employees of the Company, without additional compensation, may use their
personal efforts, by personal interview, telephone, facsimile or otherwise, to
obtain proxies in addition to solicitation by mail.
PROPOSAL NO. 1: ELECTION OF DIRECTORS
At the Annual Meeting, the shareholders will elect five directors to
hold office for one-year terms or until successors have been elected and
qualified or until any such director's earlier resignation or removal. Each
nominee is presently available for election and is a member of the Board. If any
nominee should become unavailable, which is not now anticipated, the persons
voting the accompanying proxy may in their discretion vote for a substitute. The
following table sets forth the name and age of each person nominated for
election as a director; the principal occupation, business or employment of the
nominee during the last five years, all other positions with the Company now
held by the nominee and the name of any publicly-traded corporation of which the
nominee is a director; and the date on which the nominee first became a director
of the Company.
THE BOARD RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE NOMINATED
DIRECTORS.
2
<PAGE> 6
<TABLE>
<CAPTION>
POSITIONS WITH THE COMPANY;
PRINCIPAL OCCUPATIONS DURING DIRECTOR OF THE
NAME (AGE) PAST FIVE YEARS; OTHER DIRECTORSHIPS COMPANY SINCE
- ---------- ------------------------------------ -------------
<S> <C> <C>
Dennis A. Bakal (53) President, Chief Executive Officer and Chairman of the 1990
Board of the Company.
Linda K. Roberts (50) Vice President/Administration and Secretary of the 1997
Company.
Peter C. Roth (55) Chief Financial Officer of the Company since October 1997
1996. From May 1992 to October 1996 financial and
accounting consultant to public and private companies
in a variety of industries.
Robert E. Altenbach (51) General Counsel, Secretary and member of senior 1997
management team of Vista 2000, Inc. since March 1996.
Partner with the law firm of Johnson & Montgomery from
1995-1998.
Gregory G. Hardwick (50) Certified Public Accountant in public practice since 1997
1974.
</TABLE>
DIRECTOR COMPENSATION
In March 1998, the Company's Board of Directors adopted and approved
the Professional Transportation Group Ltd., Inc. 1998 Director Stock Option Plan
(the "1998 Director Plan"). The 1998 Director Plan provides for the granting of
non-qualified stock options to non-employee directors of the Company. The 1998
Director Plan authorizes the issuance of up to 100,000 shares of Common Stock
pursuant to options having an exercise price equal to the fair market value of
the Common Stock on the date of grant. The 1998 Director Plan contains
provisions providing for adjustment of the number of shares available for option
and subject to unexercised options in the event of stock splits, dividends
payable in Common Stock, business combinations or certain other events affecting
the Common Stock. The Board administers the 1998 Director Plan subject to
certain limitations.
The 1998 Director Plan provides for the grant of options to purchase
2,000 shares to each non-employee director of the Company on the date of the
adoption of the 1998 Director Plan, 2,000 shares upon a non-employee director's
re-election or initial appointment to the Board and 1,000 shares to each
non-employee director of the Company who serves as a member of a committee of
the Board. All of the options will be granted at an exercise price equal to the
fair market value of the Common Stock on the date the options are granted. Each
option shall be exercisable in full beginning six months after the date of grant
and shall expire five years after the date of grant, unless canceled sooner as a
result of termination of service or death, unless such option is fully exercised
prior to the end of the option period.
3
<PAGE> 7
As of March 31, 1998, options to acquire 4,000 shares of Common Stock were
outstanding under the 1998 Director Plan.
In addition, the Company has paid all travel expenses and reimbursed
the directors for their out of pocket expenses related to their services as
directors. Directors also receive a cash fee of $750 per meeting for their
services as directors of the Company.
BOARD MEETINGS AND COMMITTEES
The Board met or acted by written consent eight times during the fiscal
year ended December 31, 1997. Standing committees of the Board currently
include: an Audit Committee and a Compensation Committee. Each director attended
at least 75% of all Board and relevant committee meetings during the year ended
December 31, 1997.
Messrs. Altenbach, Hardwick and Peter C. Roth are presently the members
of the Audit Committee. The Audit Committee, which was formed on August 27,
1997, did not meet during the year ended December 31, 1997. The principal
functions of the Audit Committee are reviewing the Company's internal controls
and the objectivity of its financial reporting, making recommendations regarding
the Company's employment of independent auditors and reviewing the annual audit
with the auditors.
Messrs. Altenbach, Hardwick and Bakal (non-voting member) are presently
the members of the Compensation Committee. Neither Mr. Altenbach nor Mr.
Hardwick has been an officer or an employee of the Company at any time. The
Compensation Committee (through the Board) met or acted by written consent once
during the year ended December 31, 1997. The functions of the Compensation
Committee are to review and set the compensation of the Company's Chief
Executive Officer and certain of its most highly compensated officers, including
salaries, bonuses and other incentive plans, stock options and other forms of
compensation, and to administer the Plan. Mr. Bakal does not vote on any matter
placed before the Compensation Committee. See "Report of the Compensation
Committee on Executive Compensation."
The Company does not maintain a standing nominating committee or other
committee performing a similar function.
4
<PAGE> 8
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information, as of March 31,
1998 with respect to the beneficial ownership of the Common Stock by: (i) each
director; (ii) each executive officer named in the Summary Compensation Table;
(iii) each shareholder known by the Company to be a beneficial owner of more
than 5% of the Common Stock; and (iv) all executive officers and directors as a
group. Unless otherwise indicated, each of the shareholders listed below
exercises sole voting and dispositive power over the shares.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)
----------------------
NUMBER PERCENT
----------------------
<S> <C> <C>
Dennis A. Bakal(2)........................ 2,900,100 68.0%
Linda K. Roberts(3)....................... 70,000 1.8
Peter C. Roth(4).......................... 25,000 *
William M. Kelly(3)....................... 70,000 1.8
Stanley E. Laiken(3)...................... 70,000 1.8
Robert E. Altenbach(5).................... -- *
Gregory G. Hardwick(6).................... 20,100 *
All directors and executive
officers as a group (7 persons)......... 3,155,200 69.8%
</TABLE>
- ---------------------------
* Represents less than 1%.
(1) Unless otherwise noted, the Company believes that all persons named in
the table have sole voting and investment power with respect to all
shares of Common Stock beneficially owned by them. Under the rules of
the Securities and Exchange Commission, a person is deemed to be a
"beneficial" owner of securities if he or she has or shares the power
to vote or direct the voting of such securities or the power to dispose
or direct the disposition of such securities. A person is also deemed
to be a beneficial owner of any securities which that person has the
right to acquire beneficial ownership within 60 days. More than one
person may be deemed to be a beneficial owner of the same securities.
(2) Includes options to acquire 400,000 shares of Common Stock held by Mr.
Bakal which are currently exercisable at an exercise price of $0.50 per
share. Does not include options to acquire 600,000 shares of Common
Stock, which are not exercisable within 60 days of the date of this
Proxy Statement.
(3) Consists of options to acquire 70,000 shares of Common Stock, which are
currently exercisable at an exercise price of $0.15 per share.
(4) Consists of options to acquire 25,000 shares of Common Stock, which are
currently exercisable at an exercise price of $4.00 per share.
(5) Does not include options to acquire 2,000 shares of Common Stock at an
exercise price of $2.58 per share, which are not exercisable within 60
days of this Proxy Statement.
(6) Includes options to acquire 20,000 shares of Common Stock, which are
currently exercisable at an exercise price of $0.15 per share. Does not
include options to acquire 2,000 shares of Common Stock at an exercise
price of $2.58 per share, which are not currently exercisable within 60
days of this Proxy Statement .
5
<PAGE> 9
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid or accrued by the
Company for services rendered during the years indicated to the Company's Chief
Executive Officer and the four most highly compensated executive officers whose
total salary and bonus exceeded $100,000 (collectively, the "Named Executive
Officers") during the year ended December 31, 1997. The Company did not grant
any stock appreciation rights or make any long-term incentive plan payouts
during the periods shown.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------------- ---------------
OTHER SECURITIES ALL
ANNUAL UNDERLYING OTHER
YEAR SALARY($) BONUS($)(1) COMPENSATION OPTIONS/SARS (2) COMPENSATION ($)
---- --------- ----------- ------------ ---------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Dennis A. Bakal
Chairman of the Board and
Chief Executive Officer..... 1997 150,000 -- 25,231(3) 250,000 --
1996 120,000(4) -- -- 750,000 --
1995 240,000(4) -- -- -- --
</TABLE>
- --------------------
(1) Bonuses for each year include amounts earned for that year, even if
paid in the subsequent year, and exclude bonuses paid during that year
but earned for a prior year.
(2) All figures in this column reflect options to purchase shares of Common
Stock.
(3) Includes $9,811 for payment made on Mr. Bakal's automobile, $13,500 for
a country club membership and $1,920 for country club dues.
(4) See "Compensation Committee Interlocks and Insider Participation."
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth information concerning each grant of stock
options to the Company's Chief Executive Officer during the year ended December
31, 1997. No grants were made to any of the other Named Executive Officers
during the year ended December 31, 1997.
6
<PAGE> 10
<TABLE>
<CAPTION>
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
---------------------------------------------------
PERCENT OF
NUMBER OF TOTAL
SECURITIES OPTIONS EXERCISE POTENTIAL REALIZABLE VALUE AT
UNDERLYING GRANTED TO OR BASE ASSUMED ANNUAL RATES OF STOCK
OPTIONS EMPLOYEES IN PRICE EXPIRATION PRICE APPRECIATION FOR OPTION TERM(1)
GRANTED (#) FISCAL YEAR ($/SH) DATE 5%($) 10%($)
----------- ------------- --------- ---------- ------------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Dennis A. Bakal.............. 250,000(2) 72.2% $6.00 2007 $943,000 $2,391,000
</TABLE>
- --------------------
(1) The 5% and 10% assumed annual rates of compounded stock price
appreciation are mandated by rules of the Commission. There can be no
assurance provided to any executive officer or any other holder of the
Company's securities that the actual stock price appreciation over the
term will be at the assumed 5% and 10% levels or at any other defined
level. Unless the market price of the Common Stock appreciates over the
option term, no value will be realized from the option grants made to
the Named Executive Officers.
(2) Options were granted at the fair market value of the Common Stock on
the date of grant as determined by the Board. Represents non-qualified
stock options which were granted on April 1, 1997 and vest as to 50,000
shares on January 1, 2000 and 200,000 shares on January 1, 2001 upon
the attainment of certain performance requirements or if such
performance requirements are not met, such options vest as to all
shares on February 15, 2001.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES
The following table sets forth the number of options and the value of
options held by the Named Executive Officers as of December 31, 1997.
AGGREGATE OPTION/SAR EXERCISE IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
SECURITIES UNDERLYING IN-THE-MONEY OPTIONS AT
OPTIONS AT FISCAL YEAR FISCAL YEAR END ($)(1)
END (#)
---------------------------------- --------------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Dennis A. Bakal......................... 200,000 800,000 $656,000 $1,804,000
</TABLE>
- --------------------
(1) The closing price of the Common Stock on the Nasdaq SmallCap Market on
December 31, 1997 was $3.78 per share.
7
<PAGE> 11
EMPLOYMENT AGREEMENTS
Bakal Agreement. On April 1, 1997, Mr. Bakal and the Company entered
into an employment agreement (the "Bakal Agreement") pursuant to which he will
serve as the Chief Executive Officer and President of the Company. The Bakal
Agreement provides that Mr. Bakal will receive a base salary of not less than
$300,000 per year and an annual bonus as determined by the Compensation
Committee based upon achievement of targeted levels of performance and such
other criteria as the Compensation Committee shall establish from time to time.
In addition, he may participate in the Company's 1996 Stock Option Plan (the
"Plan"), and will receive health insurance for himself and his dependents,
long-term disability insurance, civic and social club dues, use of an automobile
owned or leased by the Company and other benefits of similarly situated
employees. Mr. Bakal's base salary may be increased upon a periodic review by
the Board of Directors or the Compensation Committee. The Bakal Agreement has a
term of three years and renews daily until either party fixes the remaining term
at three years by giving written notice. The Company can terminate Mr. Bakal's
employment upon his death or disability or for cause, and Mr. Bakal can
terminate his employment for any reason within a 90-day period beginning on the
30th day after any occurrence of any change in control or within a 90-day period
beginning on the one-year anniversary of the occurrence of any change of
control. If Mr. Bakal's employment is terminated by the Company in breach of the
Bakal Agreement or if Mr. Bakal terminates the Bakal Agreement for any reason
after a change in control, the Company must pay Mr. Bakal one-twelfth of his
annual base salary and bonus for each of 36 consecutive 30-day periods following
the termination and must continue Mr. Bakal's life and health insurance until he
reaches 65, and Mr. Bakal's outstanding options to purchase Common Stock would
vest and become immediately exercisable.
In the Bakal Agreement, the Company also granted Mr. Bakal, with
respect to his shares of Common stock, piggyback and, after any termination of
employment or if he is no longer a director of the Company, demand registration
rights . Under the Bakal Agreement, Mr. Bakal agrees to maintain the
confidentiality of the Company's trade secrets. Mr. Bakal agrees that for a
period of two years, if he is terminated for cause, not to compete with or
solicit employees or customers of the Company within the United States.
Other Employment Agreements. On April 1, 1997, the Company entered into
employment agreements with each of Messrs. Kelly and Laiken and Ms. Roberts
(collectively, the "Other Agreements"). The Other Agreements provide for a
minimum base salary per year of $100,000, $88,650 and $100,000, respectively,
and an annual bonus as determined by the Chief Executive Officer and President
based upon achievement of targeted levels of performance and such other criteria
as he shall establish from time to time. In addition, each employee may
participate in the Plan and will receive insurance and other benefits of
similarly situated employees. Each of the Other Agreements has a term of three
years and renews daily until either party fixes the remaining term at three
years by giving written notice. The Company can terminate each of the employees
upon death or disability or for cause, and the employee can terminate employment
for any reason within one year of a change in control with adequate
justification. If the employee's employment is terminated by the Company for any
reason within one year after a change in control or if the employee terminates
the agreement with adequate justification, the Company must pay the employee
one-twelfth of his or her base salary and bonus for each of 36 consecutive
30-day periods following the termination and must continue the employee's life
and health insurance until age 65, and the employee's outstanding options to
purchase Common Stock would vest and become immediately exercisable. Under the
Other Agreements, each employee agrees to maintain the confidentiality of the
Company's trade secrets. The employee also agrees for a period of one year, if
he or she is terminated for cause or resigns without adequate
8
<PAGE> 12
justification, not to compete with or solicit employees or customers of the
Company within the United States.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board was formed on August 27, 1997.
The current members of the Compensation Committee are Messrs. Altenbach and
Hardwick, and Mr. Bakal is a non-voting member. Neither Mr. Altenbach nor Mr.
Hardwick has been an officer or employee of the Company at any time.
Transactions with Dennis A. Bakal and Affiliates. In May 1996, the Company moved
its operations to a facility leased to Professional Sales Group Ltd. ("PSG"), a
company wholly-owned by Dennis A. Bakal. Under the terms of the sublease with
PSG, the Company subleases certain portions of the facility from PSG at a
competitive market rate and is committed to the facility for a period of [eight]
years (the remaining term of PSG's lease with the owner, an unrelated third
party). Currently, the Company pays rent of $15,000 per month. The sublease
provides for escalations for items such as taxes and common area maintenance,
with a scheduled rent increase for the last five years of the term. If Mr. Bakal
finds suitable tenants to take the entire premises currently leased by PSG, it
is his intention to terminate the sublease with the Company and move to other
facilities. Currently, more than 40% of the space leased by PSG has been
subleased to unrelated third parties.
Certain credit facilities available to the Company have been guaranteed
personally by Mr. Bakal. Pursuant to the employment agreement entered into by
the Company and Mr. Bakal, the Company will use its best efforts to remove and
cause to be terminated all guarantees provided by Mr. Bakal. Because the Company
was unable to do so prior to December 31, 1997, the Company is obligated to
compensate Mr. Bakal for providing such guarantees. Mr. Bakal waived any such
payment in 1997.
Mr. Bakal has personally guaranteed a portion of the PSG facilities
lease and many of the equipment operating leases and other liabilities of the
Company and its subsidiaries. In the past, Mr. Bakal has personally provided
loans and advances to and has borrowed funds from the Company on an informal
basis. Certain of the loans and advances have been repaid, converted to equity
or remain unpaid at the present time. As of December 31, 1997, the Company had a
net receivable from Mr. Bakal of $577,197.
PSG provided certain management services to one of the Company's
subsidiaries, Truck-Net, Inc. ("Truck-Net") in 1996 and 1995. Fees paid by
Truck-Net for such services amounted to $120,000 and $240,000 in 1996 and 1995,
respectively. Effective June 30, 1996, the payment of management fees to PSG was
discontinued.
On December 31, 1996, PTG, Inc. (a wholly owned subsidiary of the
Company) purchased, in a nonmonetary exchange, the assets of Rapid Transit,
("Rapid") and certain other physical assets from a group of companies owned by
Mr. Bakal. As consideration for the purchase, PTG assumed accounts payable
associated with Rapid from these entities. In addition, PTG agreed to pay to a
related party 5% of the gross sales of Rapid for a period of five years.
Also on December 31, 1996, PTG purchased certain fixed assets valued at
$47,967 from USA Holdings, Inc., a company wholly-owned by Mr. Bakal. In
exchange for the assets, PTG transferred to USA Holdings, Inc. $47,967 of
receivables owed to PTG by the former corporate owner of Rapid.
9
<PAGE> 13
On December 17, 1996, Truck-Net transferred 14,570 shares of restricted
common stock of Amertranz Worldwide Holding Corp. to PSG. The shares had been
received by Truck-Net in July 1996 in exchange for $100,000 due Truck-Net by
Amertranz. In exchange for the shares, PSG issued a non-interest bearing note to
Truck-Net in the amount of $100,000, which note becomes due within 60 days after
certain transfer restrictions on the shares are eliminated.
Mr. Bakal, as the majority owner of the Company and other entities,
directs the operations of the various entities and the transactions between
them. All long-term financial commitments of the Company and its subsidiaries
with Mr. Bakal and/or other companies controlled by him are subject to written
agreements at terms, in the opinion of management, comparable to arms-length,
third-party transactions of a similar nature.
The Company believes that all the foregoing related-party transactions
were on terms no less favorable to the Company than could reasonably be obtained
from unaffiliated third parties. The Company has adopted a policy whereby all
future transactions with affiliates must be approved by a majority of
disinterested directors of the Company and on the terms no less favorable to the
Company than those that are generally available from unaffiliated third parties.
CERTAIN TRANSACTIONS
See "Compensation Committee Interlocks and Insider Participation" for the
disclosure required by this section.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
Notwithstanding anything to the contrary set forth in any of the
Company's previous or future filings under the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended (the "Exchange Act")
that might incorporate this Proxy Statement or future filings with the
Commission, in whole or in part, the following report and the Stock Performance
Chart which follows shall not be deemed to be incorporated by reference into any
such filing.
The Compensation Committee (the "Committee") consists of the following
members of the Board: Robert E. Altenbach and Gregory G. Hardwick; and Dennis A.
Bakal (non-voting member). The Committee reviews and determines the Company's
executive compensation objectives and policies and administers the Plan. The
Committee reviews and sets the compensation of the Company's Chief Executive
Officer and certain other highly compensated executive officers.
The objectives of the Company's executive compensation program are to:
(i) attract, retain and motivate highly talented and productive executives; (ii)
provide incentives for superior performance by paying above-average
compensation; and (iii) align the interests of the executive officers with the
interests of the Company's shareholders by basing a significant portion of
compensation upon the Company's performance. The Company's executive
compensation program combines the following three components, in addition to the
benefit plans offered to all employees: base salary (including cash provided for
automobile allowances); annual bonus; and long-term incentive compensation
consisting of stock option grants. Each component of the Company's executive
compensation program serves a specific purpose in meeting the Company's
objectives.
It is the Company's policy to set base salary levels, annual bonuses
and long-term incentive compensation above an average of select corporations to
which the Company compares its executive compensation. The Company selects such
corporations on the basis of a number of factors, such as their
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<PAGE> 14
size and complexity, the nature of their businesses, the regions in which they
operate, the structure of their compensation programs (including the extent to
which they rely on bonuses and other contingent compensation) and the
availability of compensation information. The corporations with which the
Company compares its compensation are not necessarily those included in the
indices used to compare the shareholder return in the Stock Performance Graph.
Further, the corporations selected for such comparison may vary from year to
year based upon market conditions and changes in both the Company's and the
corporations' businesses over time. The Company believes that above-average
compensation levels are necessary to attract and retain high caliber executives
necessary for the successful conduct of the Company's business.
Base salary. Beginning in 1998, the Committee will annually review the
salaries of the Company's executives. When setting base salary levels, in a
manner consistent with the objectives outlined above, the Committee considers
competitive market conditions for executive compensation, Company performance
and individual performance.
The measures of individual performance considered in setting 1998
salaries will include, to the extent applicable to an individual executive
officer, a number of quantitative and qualitative factors such as the Company's
historical and recent financial performance in the principal area of
responsibility of the officer (including such measures as gross margin, net
income, sales, customer count and market share), the individual's progress
toward non-financial goals within his area of responsibility, individual
performance, experience and level of responsibility and other contributions made
to the Company's success. The Committee has not found it practicable, nor has it
attempted, to assign relative weights to the specific factors used in
determining base salary levels, and the specific factors used may vary among
individual officers. As is typical for most corporations, payment of base salary
is not conditioned upon the achievement of any specific, pre-determined
performance targets.
Annual bonus. The Company's cash bonus program seeks to motivate
executives to work effectively to achieve the Company's financial performance
objectives and to reward them when those objectives are met. Executives bonus
payments are based upon the overall profitability of the Company.
Long-term incentive compensation. The Company believes that option
grants: (i) align executives interests with shareholder interests by creating a
direct link between compensation and shareholder return; (ii) give executives a
significant, long-term interest in the Company's success; and (iii) help retain
key executives in a competitive market for executive talent.
The Plan authorizes the Committee to grant stock options to executives.
Option grants are made from time to time to executives whose contributions have
or will have a significant impact on the Company's long-term performance. The
Company's determination of whether option grants are appropriate each year is
based upon individual performance measures established for each individual.
Options are not necessarily granted to each executive during each year.
Generally, options granted to executive officers will vest in equal annual
installments over a period of three to four years and expire ten years from the
date of grant.
Benefits. The Company believes that it must offer a competitive benefit
program to attract and retain key executives. During 1997, the Company provided
medical and other benefits to its executive officers that are generally
available to the Company's other employees.
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<PAGE> 15
Compensation of the Chief Executive Officer.
The Chief Executive Officer's compensation plan includes the same
elements and performance measures as the plans of the Company's other executive
officers. The Compensation Committee believes that Mr. Bakal's total
compensation reflects the unique contributions that he makes to the Company's
long-term strategic performance. Mr. Bakal's salary for the year ended December
31, 1997 increased 25% from the year ended December 31, 1996 and he was not
awarded a bonus for the year ended December 31, 1997. For the year ended
December 31, 1998, Mr. Bakal's base salary will be $300,000, which is the same
base salary as was paid Mr. Bakal during 1997. The Committee believes that such
salary is appropriate based upon the Company's financial performance, including
earnings per share, revenue growth and cash flow from operations.
Submitted by: Robert E. Altenbach
Gregory G. Hardwick
Dennis A. Bakal (non-voting member)
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STOCK PERFORMANCE GRAPH
The chart below compares the cumulative total shareholder return on the
Common Stock with the cumulative total return on the Nasdaq (U.S. Companies)
Index and the Nasdaq Transportation and Trucking Stock Index for the period
commencing June 20, 1997 (the first day of trading of the Common Stock as a
result of the Company's initial public offering) and ending December 31, 1997,
assuming an investment of $100 and the reinvestment of any dividends. The base
price for the Company's stock is the initial public offering price of $6.00 per
share. The comparisons in the graph below are based upon historical data and are
not indicative of, nor intended to forecast, future performance of the Common
Stock.
[GRAPH OMITTED]
<TABLE>
<CAPTION>
6/20/97 12/31/97
<S> <C> <C>
Professional Transportaion Group Ltd., Inc. $100.00 $ 63.00
NASDAQ (U.S. Companies) $100.00 $109.00
NASDAQ Transportation and Trucking $100.00 $115.00
</TABLE>
13
<PAGE> 17
PROPOSAL NO. 2: APPROVAL AND RATIFICATION OF THE ADOPTION
OF AN AMENDMENT TO THE PLAN
On March 13, 1998, the Board approved an amendment to the Plan to
increase the number of shares available for issuance as incentive stock options
or non-qualified options under the Plan from 1,500,000 to 2,000,000. In
addition, the Plan was amended to provide that the number of shares of Common
Stock available for issuance thereunder shall be automatically increased on the
first trading day of each calendar year by three percent of the number of shares
outstanding on the preceding trading day. Finally, the Plan was amended to
change the amendment requirements to the Plan. The Plan formerly required
shareholder approval of all increases in options available for grant under the
Plan. As amended, the Plan provides that shareholder approval is only required
for increases of shares issuable pursuant to incentive stock options ("ISOs")
(other than increases pursuant to the automatic increase described above) and
for changes in the class of employees eligible to receive ISOs under the Plan.
At the Annual Meeting, the shareholders are being asked to approve and ratify
such increase in shares available for issuance under the Plan and the other
amendments. The Board believes that the adoption of the amendments to the Plan
will foster good employee relations and encourage and assist employees of the
Company to acquire an equity interest in the Company, as well as simplify the
procedure of amending the Plan, saving the Company the time and expenses
involved with obtaining routine shareholder approval. In addition, the Board
believes the utilization of the Plan helps align employee interest with other
shareholders and helps provide for the future financial security of the
Company's employees. The Plan should thereby be helpful in attracting, retaining
and motivating employees. The details of the Plan are described below. A copy of
the amendments to the Plan is attached to this Proxy Statement as Exhibit A.
THE BOARD RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND THE PLAN.
DESCRIPTION OF THE PLAN, AS AMENDED
In February 1996, the Board adopted, and the Company's shareholders
approved, the Plan. The Plan originally provided for the issuance of 1,500,000
shares of the Common Stock upon the exercise of options. As of March 31, 1998,
options to acquire approximately 1,364,337 shares were outstanding under the
Plan. Mr. Bakal holds options under the Plan to purchase 1,000,000 shares of
Common Stock. Gregory G. Hardwick is the only director who is not also an
executive officer of the Company holds options under the Plan, consisting of
options to purchase 20,000 shares of Common Stock.
The purpose of the Plan is to advance the interests of the Company, its
subsidiaries and its shareholders by affording certain employees of the Company
and its subsidiaries and other key persons an opportunity to acquire or increase
their proprietary interests in the Company. The objective of the issuance of the
options and restricted stock awards is to promote the growth and profitability
of the Company and its subsidiaries because the recipients of options or
restricted stock awards will have an additional incentive to achieve the
Company's objectives through participation in its success and growth and by
encouraging their continued association with or service to the Company. Persons
eligible to participate in the Plan consist of all employees of the Company or
any subsidiary and other key persons whose participation in the Plan the
Committee determines to be in the best interests of the Company.
Options granted under the Plan may be ISOs, which are intended to meet
the requirements of Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code"), or non-qualified options, which are not intended to meet such
requirements ("Non-Qualified Options"). ISOs must have terms of ten years or
less from the date of grant and the fair market value of ISOs that may be
exercised for the first time during any year may not exceed $100,000 based on
the fair market value on the date of grant.
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<PAGE> 18
The Plan is administered by the Compensation Committee (the "Committee"), having
the duties and authorities set forth in such Plan in addition to any other
authority granted by the Board. The Committee has the full power and authority,
in its discretion, subject to the provisions of the Plan, to interpret such
Plan, to prescribe, amend, and rescind rules and regulations relating to them,
to determine the details and provisions of each stock option agreement and
restriction agreement, and to make all other determinations necessary or
advisable for the administration of such Plan, including, without limitation,
the amending or altering of such Plan and any options or restricted stock awards
granted thereunder, as may be required to comply with or to conform to any
federal, state, or local laws or regulations. The Committee, in its discretion,
selects the recipients of awards and the number of shares or options granted
thereunder and determines other matters such as (i) vesting schedules, (ii) the
exercise price of options (which cannot be less than 100% of the fair market
value of the Common Stock on the date of grant for ISOs) and (iii) the duration
of awards (which cannot exceed ten years from the date of grant or modification
of the option).
The aggregate number of shares of Common Stock reserved for the
issuance of options and restricted stock awards under the Plan will be 2,000,000
shares, subject to adjustment in accordance with the Plan. Any or all shares of
Common Stock subject to the Plan may be issued in any combination of ISOs,
Non-Qualified Options or restricted stock awards, and the amount of Common Stock
subject to the Plan may be increased from time to time as provided therein.
Shares subject to an option or issued as a restricted stock award may be either
authorized and unissued shares or shares issued and later reacquired by the
Company. The shares covered by any unexercised portion of an option that has
terminated for any reason, or any forfeited portion of a restricted stock award,
may again be optioned or awarded under the Plan, and such shares shall not be
considered as having been optioned or issued in computing the number of shares
of Common Stock remaining available for options or restricted stock awards under
the Plan.
CERTAIN FEDERAL INCOME TAX EFFECTS
The following discussion of the federal income tax consequences of the
Plan is intended to be a summary of applicable federal income tax law. State and
local tax consequences may differ.
ISOs. A participant is not taxed on the grant or exercise of an ISO.
However, the difference between the fair market value of the shares on the
exercise date and the exercise price will, be a preference item for purposes of
the alternative minimum tax. If a participant holds the shares acquired upon
exercise of an ISO for at least two years following grant and at least one year
following exercise, the participant's gain, if any, by a subsequent disposition
of such shares will be treated as long term capital gain for federal income tax
purposes. The measure of the gain is the difference between the proceeds
received on disposition and the participant's basis in the shares (which
generally equals the exercise price). If the participant disposes of stock
acquired pursuant to exercise of an ISO before satisfying the one and two year
holding periods described above, the participant will recognize both ordinary
income and capital gain in the year of disposition. The amount of the ordinary
income will be the lesser of (i) the amount realized on disposition less the
participant's adjusted basis in the stock (usually the option exercise price) or
(ii) the difference between the fair market value of the stock on the exercise
date and the option exercise price. The balance of the consideration received on
such disposition will be long term capital gain if the stock had been held for
at least one year following exercise of the ISO. The Company is not entitled to
an income tax deduction on the grant or the exercise of an ISO or on the
participant's disposition of the shares after satisfying the holding period
requirement described above. If the holding periods are not satisfied, the
Company will be entitled to an income tax deduction in the year the participant
disposes of the shares, in an amount equal to the ordinary income recognized by
the participant.
Non-Qualified Options. Generally, a participant is not taxed on the
grant of a Non-Qualified Option. Upon exercise, however, the participant
recognizes ordinary income equal to the difference
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<PAGE> 19
between the exercise price and the fair market value of the shares on the date
of the exercise. The Company is entitled to an income tax deduction in the year
of exercise in the amount recognized by the participant as ordinary income. Any
gain on subsequent disposition of the shares is long term capital gain if the
shares are held for at least one year following exercise. The Company does not
receive an income tax deduction for this gain.
Restricted Stock. Generally, and except as noted below, the grant of
restricted stock is not taxable at the time of the grant. Instead, at the time
restricted stock vests or becomes transferable, an employee will recognize
ordinary income equal to (i) the excess of the fair market value of such
restricted stock on the date the shares vest over (ii) the price, if any, paid
for such restricted stock. An employee may, however, elect to recognize income
as of the date of grant of the restricted stock, in an amount equal to (i) the
excess of the fair market value of the restricted stock on the date of grant
over (ii) the price, if any, paid for the restricted stock. If such an election
is made, no additional income will be recognized at the time the stock vests or
becomes transferable. In the event of a subsequent forfeiture of the shares, an
employee making such an election may be able to recognize a capital loss with
respect to the amount, if any, paid for such restricted stock, but only to the
extent such amount exceeds the amount realized by such employee on such
forfeiture. The employee will not be able to recognize a loss for tax purposes
with respect to the excess of fair market value over the purchase price which
was previously included in income. Dividends paid on the shares of restricted
stock before they vest will be taxed to the employee either as additional
compensation or, if the employee has made the election described above, as
dividend income.
PROPOSAL NO. 3: APPROVAL OF THE
1998 EMPLOYEE STOCK PURCHASE PLAN
At a meeting of the Board of Directors of the Company on March 13,
1998, the Board of Directors unanimously approved and recommended to the
shareholders the adoption of the 1998 Employee Stock Purchase Plan for employees
of the Company and its subsidiaries (the "Purchase Plan"). The Purchase Plan was
established pursuant to the provisions of Section 423 of the Internal Revenue
Code of 1986, as amended (the "Code"), and the principle features of the
Purchase Plan are summarized below. All statements made in the following summary
of the Purchase Plan are qualified by reference to the full text of the Purchase
Plan attached to this Proxy Statement as Exhibit B.
Purpose
The purpose of the Purchase Plan is to provide a method whereby all
eligible employees of the Company may acquire a proprietary interest in the
Company through the purchase of Common Stock. Under the Purchase Plan, payroll
deductions are used to purchase the Company's Common Stock.
Reservations of Shares
An aggregate of 200,000 shares of Common Stock of the Company will be
reserved for issuance under the Purchase Plan. In the event of corporate changes
affecting the Company's Common Stock, such as reorganizations, share splits,
share dividends, mergers, consolidations or otherwise, the Company will make
appropriate adjustments in the number of shares reserved under the Purchase
Plan. The Board of Directors believes that the Purchase Plan will serve as an
incentive for the Company to retain employees of training, experience and
ability, to encourage a sense of proprietorship of such persons and to stimulate
the active interests of such persons in the development and financial success of
the Company.
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ADMINISTRATION
The Purchase Plan is administered by the Compensation Committee of the
Board of Directors (the "Committee"). All determinations by the Committee are
final and conclusive.
Eligibility
All employees (including officers of the Company) who have been
continuously employed for 180 days or more by the Company or its subsidiaries
(during which such employee's worked 1,000 or more hours) as of the commencement
of any offering period under the Purchase Plan, are eligible to participate in
the Purchase Plan. All employees of the Company on the effective date of the
Purchase Plan are eligible to participate. The employee must enroll in the
Purchase Plan prior to the commencement of any such offering periods by
authorizing payroll deductions of any whole percentage from one percent (1%) to
ten percent (10%) of such participant's compensation (as defined to include
without limitation overtime, commissions and bonuses) to be applied toward the
purchase of the Company's Common Stock, which may not be increased or decreased
during any offering period unless otherwise allowed by the Committee. No
employee shall be eligible to enroll under the Purchase Plan who, at the time of
enrollment, owns stock possessing 5% or more of the total combined voting power
of the Company. The Company estimates that approximately 800 employees are
eligible to participate in the Purchase Plan. Mr. Bakal is not eligible to
participate in the Purchase Plan due to his greater than 5% ownership of Common
Stock. All other executives officers and eligible employees of the Company are
entitled to participate in the Purchase Plan.
Purchase Terms
An employee electing to participate in the Purchase Plan must authorize
a whole percentage (not less than 1% nor more than 10%) of the employee's
compensation to be deducted by the Company from the employee's pay during any
pay period included within the offering periods (the "Offering Periods"). Unless
otherwise determined by the Committee, the Offering Periods commence on January
1 of each year and terminate on December 31 of such year (except that the first
Offering Period is expected to be for a period from July 1, 1998 to December 31,
1998). On the first business day of each of the Offering Periods, the Company
will grant to each participant an option to purchase shares of Common Stock of
the Company. On the last day of each of the Offering Periods, the employee will
be deemed to have exercised this option, at the option price, to the extent of
such employee's accumulated payroll deductions. In no event, however, may the
employee purchase Common Stock having a fair market value (measured at the
commencement of the Offering) in excess of $25,000 per Offering Period. The
option price under the Purchase Plan is equal to the lesser of 85% of the fair
market value of the Common Stock on either the first or last day of business of
the applicable Offering Period. No interest will be paid on amounts deducted
from an employee's pay and used to purchase Common Stock under the Purchase
Plan.
A participant may voluntarily withdraw from the Purchase Plan at any
time by giving at least 30 days notice to the Company prior to the end of the
Offering Period and shall receive on withdrawal the cash balance (without
interest) then held in the participant's account. Upon termination of employment
for any reason, including resignation, discharge, disability or retirement, or
upon death of a participant, the balance of the participant's account (without
interest) shall be paid to the participant or his or her designated beneficiary.
However, in the event of the participant's death, the participant's beneficiary
may elect to exercise the participant's option to purchase such number of full
shares which such participant's accumulated payroll deductions will purchase at
the applicable price.
Amendment or Termination
The Board of Directors may, at any time, amend, suspend or discontinue
the Purchase Plan provided no such suspension or discontinuance may adversely
affect any outstanding options. The
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<PAGE> 21
Purchase Plan provides that, without shareholder approval, no amendment may (i)
increase materially the maximum number of shares issuable under the Stock
Purchase Plan (except for adjustments as a result of corporate changes affecting
the Company's Common Stock specifically authorized in the Purchase Plan), (ii)
increase materially the benefits accruing to participants under the Purchase
Plan or (iii) modify materially the requirements as to the eligibility for
participation in the Plan. The Purchase Plan will terminate on its own terms on
December 31, 2008.
Miscellaneous
The proceeds received by the Company from its sale of Common Stock
pursuant to the Purchase Plan will be used for general corporate purposes. The
Company is not obligated to hold the accrued payroll deductions in a segregated
account. The Purchase Plan will be effective as of the latter to occur of (a)
July 1, 1998 or (b) the date on which each of the following shall have occurred:
(i) the Purchase Plan shall have been approved by the shareholders of the
Company and (ii) a registration statement for the Purchase Plan shall have
become effective under the Securities Act of 1933, as amended.
Certain Federal Income Tax Consequences
The following general description of federal tax consequences is based
on current statutes, regulations and interpretations, and does not include
possible state or local income tax consequences. The Purchase Plan is intended
to qualify as an "Employee Stock Purchase Plan" within the meaning of Section
423 of the Code with the following principle tax consequences.
Amounts deducted from a participant's pay under the Purchase Plan are
included in the participant's compensation subject to federal income and
employment taxes. The Company will withhold taxes on these amounts.
The purchase of Common Stock under the Purchase Plan will not result in
an employee's realization of taxable income, thus permitting employees to
acquire stock in the Company without immediate tax consequences. An employee who
does not dispose of Common Stock so purchased until at least two years after the
date of enrollment and 12 months after the date of purchase will also receive
long-term capital gain treatment for any appreciation in value of such
employee's Common Stock over the fair market value at the time of enrollment for
the calendar year such purchase is effective. Such capital gain treatment is
not, however, available for the 15% discount at which the Common Stock is
initially purchased, and an employee who meets the holding requirements above is
required to include as ordinary income at the time of such employee's death or
disposition of such employee's Common Stock the lesser of (i) the excess of its
fair market value over the price at the time enrollment is effective or (ii) the
excess of its fair market value at the time of disposition or death over the
amount such employee actually paid for such shares. If an employee sells such
employee's Common Stock under such circumstances for less than such employee
paid for such shares, there is no ordinary income and such employee will realize
a long-term capital loss on the difference. Any ordinary income realized by an
employee will increase the basis of such employee's Common Stock for purposes of
determining the amount of any gain or loss realized upon its disposition.
With limited exceptions, an employee who fails to retain Common Stock
purchased under the Purchase Plan until at least two years after the effective
date of enrollment and 12 months after the date of purchase is considered to
have made a "disqualifying disposition" and forfeits the special tax treatment
extended under Section 423 of the Code. In general, such an employee recognizes
ordinary income at the time of such disposition equal to the excess of market
value of the Common Stock at the
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<PAGE> 22
exercise date over the purchase price paid. Such fair market value as of the
exercise date becomes the tax basis for determining any further gain or loss at
the time of disposition of the Common Stock. In determining whether that gain or
loss is short-term or long-term, the holding period is calculated from the date
of purchase. A capital gain or loss is long-term if the shares have been held
for more than 12 months.
The Company is entitled to a deduction equal to the amount of ordinary
income realized by an employee who makes a disqualifying disposition. Otherwise,
the Company is not entitled to any deduction on account of the purchase of
Common Stock under the Purchase Plan.
The approval of the adoption of the Purchase Plan requires the
affirmative vote of a majority of the shares of Common Stock outstanding. A copy
of the Purchase Plan is attached to this Proxy Statement as Exhibit B.
THE BOARD RECOMMENDS A VOTE "FOR" THE PROPOSAL TO ADOPT THE PURCHASE
PLAN.
COMPLIANCE WITH SECTION 16(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires the Company's executive
officers and directors and persons who beneficially own more than 10% of a
registered class of the Company's equity securities to file reports of
securities ownership and changes in such ownership with the SEC and Nasdaq.
Officers, directors and greater than 10% beneficial owners also are required by
rules promulgated by the SEC to furnish the Company with copies of all Section
16(a) forms they file. Based solely on review of the copies of such reports
furnished to the Company and written representations that no other reports were
required, the Company believes that, during the year ended December 31, 1997,
its executive officers, directors and greater than 10% beneficial owners
complied with all applicable Section 16(a) filing requirements, except that Mr.
Hardwick failed to file a Form 4 for one purchase transaction which has been
reported on his Form 5.
INDEPENDENT AUDITORS
The Company selected the firm of Arthur Andersen LLP to serve as the
independent auditors for the Company for the year ended December 31, 1997. That
firm has served as the auditors for the Company since 1996. Representatives of
Arthur Andersen LLP are expected to be present at the Annual Meeting and will be
accorded the opportunity to make a statement, if they so desire, and to respond
to appropriate questions.
OTHER MATTERS
The Board knows of no amendment or variation of the matters referred to
in the Notice of the Annual Meeting and of no other business to be brought
before the Annual Meeting. However, if any amendment, variation or other matter
is properly brought before the Annual Meeting, it is the intention of the
persons designated as proxies to vote in accordance with their best judgment on
such matters. If any other matter should come before the Annual Meeting, action
on such matter will be approved if the number of votes cast in favor of the
matter exceeds the number opposed.
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SHAREHOLDER PROPOSALS FOR THE 1999 ANNUAL MEETING OF SHAREHOLDERS
Regulations of the Commission require Proxy Statements to disclose the
date by which shareholder proposals must be received by the Company in order to
be included in the Company's proxy materials for the next annual meeting. In
accordance with these regulations, shareholders are hereby notified that if they
wish a proposal to be included in the Company's Proxy Statement and form of
proxy relating to the 1999 annual meeting, a written copy of their proposal must
be received at the principal executive offices of the Company no later than
January 22, 1999. To ensure prompt receipt by the Company, proposals should be
sent certified mail return receipt requested. Proposals must comply with the
proxy rules relating to stockholder proposals in order to be included in the
Company's proxy materials.
ANNUAL REPORT
The Company's 1997 Annual Report to Shareholders (which includes the
Company's Annual Report on Form 10-KSB) is concurrently being mailed to
shareholders. The Annual Report contains consolidated financial statements of
the Company and the report thereon of Arthur Andersen LLP, independent auditors.
DATED: APRIL 15, 1998
SHAREHOLDERS ARE URGED TO SPECIFY THEIR CHOICES, DATE, SIGN AND RETURN
THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE, POSTAGE FOR WHICH HAS BEEN
PROVIDED. YOUR PROMPT RESPONSE WILL BE APPRECIATED.
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EXHIBIT A
FIRST AMENDMENT TO THE
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
1996 STOCK OPTION PLAN
WHEREAS, the Board of Directors and shareholders of Professional
Transportation Group Ltd., Inc., a Georgia corporation (the "Company"), adopted
the Professional Transportation Group Ltd., Inc. 1996 Stock Option Plan (the
"Plan") in February 1996; and
WHEREAS, the purpose of the Plan is to advance the interests of the
Company, its subsidiaries and its shareholders by affording certain employees of
the Company and its subsidiaries and other key persons an opportunity to acquire
or increase their proprietary interests in the Company; and
WHEREAS, effective March 13, 1998, the Board of Directors approved the
following amendment to the Plan (the "First Amendment") and recommended that
such amendments be approved by the shareholders;
NOW, THEREFORE, the Plan is hereby amended as follows:
1. Defined Terms. Initially capitalized terms used in this
Amendment, which are not otherwise defined by this Amendment, are used with the
same meaning ascribed to such terms in the Plan.
2. Amendments.
a. The first paragraph of Section 5.1 of the Plan is
amended to read as follows:
5.1 Limitations. Subject to any antidilution
adjustment pursuant to the provisions of Section 5.2 hereof,
the maximum number of shares of Stock that may be issued
hereunder shall be 2,000,000, and not more than 200,000 shares
of Stock may be made subject to Options to any individual in
the aggregate in any one fiscal year of the Company, such
limitation to be applied in a manner consistent with the
requirements of, and only to the extent required for
compliance with, the exclusion from the limitation on
deductibility of compensation under Section 162(m) of the
Code. The number of shares of Stock available for issuance
hereunder shall automatically increase on the first trading
day each calendar year beginning January 1, 1999, by an amount
equal to three percent (3%) of the shares of Stock outstanding
on the trading day immediately preceding January 1; but in no
event shall any such annual increase exceed 500,000 shares.
Any or all shares of Stock subject to the Plan may be issued
in any combination of Incentive Stock Options, non-Incentive
Stock Options or Restricted Stock, and the amount of Stock
subject to the Plan may be increased from time to time in
accordance with Article IX. Shares subject to an Option or
issued as an Award may be either authorized and unissued
shares or shares issued
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and later acquired by the Company. The shares covered by any
unexercised portion of an Option that has terminated for any
reason (except as set forth in the following paragraph), or
any forfeited portion of an Award, may again be optioned or
awarded under the Plan, and such shares shall not be
considered as having been optioned or issued in computing the
number of shares of Stock remaining available for option or
award hereunder.
b. Article IX of the Plan is replaced in its entirety by
the following:
9.1 Termination and Amendment. The Board may
at any time terminate the Plan; provided, however, that the
Board (unless its actions are approved or ratified by the
shareholders of the Company within twelve months of the date
that the Board amends the Plan) may not amend the Plan to:
(a) Increase the total number of shares of
Stock issuable pursuant to Incentive Stock Options under the
Plan, except as contemplated in Sections 5.1 and 5.2 hereof;
or
(b) Change the class of employees eligible
to receive Incentive Stock Options that may participate in the
Plan.
9.2 Effect on Optionee's Rights. No termination,
amendment, or modification of the Plan shall affect adversely
an Optionee's rights under a Stock Option Agreement without
the consent of the Optionee or his legal representative.
3. Effectiveness. This Amendment shall not become effective
unless and until such provisions are approved by at least a majority vote of the
holders of the outstanding capital stock of the Company present, or represented,
and entitled to vote on such matter at a meeting of shareholders duly called and
convened within one year following the date hereof.
4. Approval. Except as hereinabove amended and modified, the Plan
is approved, ratified and affirmed without further modification or amendment.
IN WITNESS WHEREOF, the Company has caused this Amendment to be
executed as of March 13, 1998, in accordance with the authority provided by the
Board of Directors.
PROFESSIONAL TRANSPORTATION GROUP
LTD., INC.
By: /s/ Dennis A. Bakal
------------------------------
Name: Dennis A. Bakal
Title: Chief Executive Officer
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EXHIBIT B
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
1998 EMPLOYEE STOCK PURCHASE PLAN
1. PURPOSE.
This Professional Transportation Group Ltd., Inc. 1998 Employee Stock
Purchase Plan (the "Plan") is being established for the benefit of employees of
Professional Transportation Group Ltd., Inc., a Georgia corporation (the
"Company"), its wholly owned subsidiaries and any subsequently designated
subsidiaries of the Company. The Plan is intended to provide the employees of
the Employer with an opportunity to purchase Common Stock, no par value per
share, of the Company (the "Shares"), through accumulated payroll deductions. It
is the intention of the Company that the Plan qualify as an "employee stock
purchase plan" within the meaning of Section 423 of the Code, and the provisions
of the Plan shall be construed in a manner consistent with the requirements of
such Section of the Code.
2. DEFINITIONS.
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Change in Capitalization" shall mean any increase, reduction,
or change or exchange of Shares for a different number or kind
of shares or other securities of the Company by reason of a
reclassification, recapitalization, merger, consolidation,
reorganization, share dividend, share split or reverse share
split, combination or exchange of shares, repurchase of
Shares, change incorporate structure or otherwise.
(c) "Change in Control" of the Company shall have the meaning
given in Section 16(b) hereof.
(d) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
(d) "Committee" shall mean the Compensation Committee or any other
committee of members of the Board appointed by the Board to
administer the Plan and to perform the functions set forth
herein. No Board member will be eligible to serve on such
Committee if that Board member has within the twelve (12)
month period preceding the date of his or her initial
appointment to the Committee participated in the Plan.
(f) "Company" shall mean Professional Transportation Group Ltd.,
Inc., a corporation organized under the laws of the State of
Georgia, or any successor corporation.
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(g) "Compensation" shall mean the fixed salary, wages,
commissions, overtime pay and bonuses paid by an Employer to
an Employee as reported by the Employer to the United States
government for federal income tax purposes, including an
Employee's portion of compensation deferral contributions
pursuant to Section 401(k) of the Code, any amount excludable
pursuant to Section 125 of the Code and/or any non-qualified
compensation deferral, but excluding any foreign service
allowance, severance pay, expenses or any benefit paid by a
third-party payer under any employee plan maintained by the
Employer.
(h) "Continuous Status as an Employee" shall mean the absence of
any interruption or termination of service as an Employee.
Continuous Status as an Employee shall not be considered
interrupted in the case of a leave of absence agreed to in
writing by the Employee's Employer, if such leave is for a
continuous period of not more than one year or reemployment
upon the expiration of such leave is guaranteed by contract or
statute.
(i) "Designated Subsidiaries" shall mean the Subsidiaries of the
Company which have been designated by the Board from time to
time in its sole discretion as eligible to participate in the
Plan, which may include corporations which become Subsidiaries
of the Company after the adoption of the Plan.
(j) "Effective Date" shall have the meaning set forth in Section
22 hereof.
(k) "Employee" shall mean any person, including an officer, who as
of an Offering Date is regularly employed by the Company, a
wholly owned Subsidiary of the Company or a Designated
Subsidiary of the Company and who has completed 180 days of a
Year of Service. Notwithstanding the requirement of a Year of
Service, all persons employed by the Company on the Effective
Date shall be considered "Employees" for purposes of the Plan.
(l) "Employer" shall mean, as to any particular Employee, the
corporation which employs such Employee, whether it is the
Company, a wholly-owned Subsidiary of the Company or a
Designated Subsidiary of the Company.
(m) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
(n) "Exercise Date" shall mean the last business day of each
Offering Period, except as the Committee may otherwise
provide. For purposes of the Plan, the term "business day"
means a day on which there is permitted trading of the Shares
on the Nasdaq National Market or on a national securities
exchange, whichever is applicable; and if neither is
applicable, a day that is not a Saturday, Sunday or legal
holiday in the State of Georgia.
(o) "Fair Market Value" per Share as of a particular date shall
mean:
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(i) the closing sales price, regular way for the Shares
on any national securities exchange on which the
Shares are actively traded on such date (or if such
exchange was not open for trading on such date, the
next preceding date on which it was open); or
(ii) if there is no price as specified in (i), the mean of
the last reported bid-and-asked quotations regular
way, for the Shares on such exchange on such date (or
if there was no such quotations on such date, the
next preceding date); or
(iii) if there also is no price as specified in (ii), the
closing sales price, regular way, or in the absence
thereof the mean of the last reported bid-and-asked
quotations, for the Shares on the other exchange on
which the Shares are permitted to trade having the
greatest volume of trading in the Shares during the
30-day period preceding such date, on such date (or
if there were no such quotations on such date, the
next preceding date); or
(iv) if there also is no price as specified in (iii), the
final reported sales price, or if not reported in the
following manner, the highest bid quotation, in the
over-the-counter market for the Shares as reported by
Nasdaq, or if not so reported, then as reported by
the National Quotation Bureau Incorporated, or if
such organization is not in existence, by an
organization providing similar services, on such date
(or if such date is not a date for which such system
or organization generally provides reports, then on
the next preceding date for which it does so); or
(v) if there also is no price as specified in (iv), the
price determined by the Committee by reference to the
bid-and-asked quotations for the Shares provided by
members of an association of brokers and dealers
registered pursuant to subsection 15(b) of the
Exchange Act, which members make a market in the
Shares, for such recent dates as the Committee shall
determine to be appropriate for fairly determining
current fair market value; or
(vi) if there also is no price as specified in (v), the
price determined by the Committee for the date in
question.
(p) "Offering Date" shall mean the first business day of each
Offering Period. The Offering Date of an Offering Period is
the grant date for the options offered in such Offering
Period. Notwithstanding the foregoing, the first Offering Date
following adoption of the Plan shall be the first business day
on or after the Effective Date.
(q) "Offering Period" shall mean each twelve (12) month period
commencing January 1 and ending December 31 during the term of
the Plan, and except that the Committee shall have the power
to change the duration of Offering Periods;
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however, no option granted under the Plan shall be exercisable
more than twenty-seven (27) months from its date of grant.
Notwithstanding the foregoing, the first Offering Period
following the adoption of the Plan shall begin on the
Effective Date and end on December 31, 1998.
(r) "Parent" shall mean any corporation (other than the Company)
in an unbroken chain of corporations ending with the Company
if, at the time of granting an option, each of the
corporations other than the Company owns shares possessing
fifty percent (50%) or more of the total combined voting power
of all classes of shares in one of the other corporations in
such chain.
(s) "Participant" shall mean an Employee who participates in the
Plan.
(t) "Plan" shall mean Professional Transportation Group Ltd., Inc.
1998 Employee Stock Purchase Plan, as amended from time to
time.
(u) "Plan Year" shall mean the calendar year, except that the
Committee shall have the power to change the Plan Year.
(v) "Shares" shall mean the Common Stock, no par value per share,
of the Company.
(w) "Subsidiary" shall mean any corporation (other than the
Company) in an unbroken chain of corporations beginning with
the Company if, at the time of granting an option, each of the
corporations other than the last corporation in the unbroken
chain owns shares possessing fifty percent (50%) or more of
the total combined voting power of all classes of shares in
one of the other corporations in such chain.
(x) "Year of Service" shall mean each successive period of twelve
consecutive months (from an Employee's original employment
date) during which the Employee's hours of employment are
1,000 hours or more.
I. ELIGIBILITY.
Subject to the requirements of Sections 4(b) and 20(d) hereof, any
person who is an Employee as of an Offering Date shall be eligible to
participate in the Plan and be granted an option for the Offering Period
commencing on such Offering Date.
Notwithstanding any provisions of the Plan to the contrary, no Employee
shall be granted an option under the Plan (i) if, immediately after the grant,
such Employee (or any other person whose shares would be attributed to such
Employee pursuant to Section 424(d) of the Code) would own shares and/or hold
outstanding options to purchase shares possessing five percent (5%) or more of
the total combined voting power or value of all classes of shares of the Company
or of any Subsidiary or Parent of the Company, or (ii) which permits such
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Employee's right to purchase shares under all employee stock purchase plans (as
described in Section 423 of the Code) of the Company and any Subsidiary or
Parent of the Company to accrue at a rate which exceeds twenty-five thousand
dollars ($25,000) of Fair Market Value of such shares (determined at the time
such option is granted) for any calendar year in which such option would be
outstanding at any time. The purpose of the limitation in the preceding sentence
is to comply with Section 423(b)(8) of the Code. If the Employee's accumulated
payroll deductions on the last day of the Offering Period would otherwise enable
the Employee to purchase Shares in excess of the Section 423(b)(8) limitation
described in this Section, the excess of the amount of the accumulated payroll
deductions over the aggregate purchase price of the Shares actually purchased
shall be credited towards the next Offering Period. In the event the Employee
elects to discontinue participation in the Plan, such amount shall be promptly
refunded to the Employee by the Company, without interest.
4. GRANT OF OPTION; PARTICIPATION; PRICE.
(a) On each Offering Date the Company shall commence an offering
by granting each eligible Employee an option to purchase
Shares, subject to the limitations set forth in Section 3(b)
and Section 10 hereof.
(b) Each eligible Employee may elect to become a Participant in
the Plan with respect to an Offering Period, by filing an
agreement with his or her Employer authorizing payroll
deductions in accordance with Section 5 hereof. Such
authorization will remain in effect for subsequent Offering
Periods, until modified or terminated by the Participant by
giving written notice to his or her Employer prior to the next
occurring Exercise Date. Such authorization to make payroll
deductions must be received by the Company at least twenty
(20) days before the next succeeding Offering Date.
(c) The option price per Share subject to an offering shall be 85%
of the Fair Market Value of the Shares on the Exercise Date of
reference; and, provided further that the option price per
Share shall never be less than the par value per Share.
5. PAYROLL DEDUCTIONS.
Subject to Section 4(b) hereof, a Participant may, in accordance with
rules and procedures adopted by the Committee, authorize a payroll deduction of
any whole percentage from 1% to 10% of such Participant's Compensation each pay
period (the permissible range and any other limitation applicable to
Participants as a whole within such percentages to be determined by the
Committee from time to time). A Participant may not increase or decrease such
payroll deduction (provided that a Participant may withdraw from the Plan under
Section 8) during each Offering Period (unless otherwise allowed by the
Committee in its sole discretion). All payroll deductions made by a Participant
shall be credited to such Participant's account under the Plan.
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6. EXERCISE OF OPTION.
(a) Unless a Participant withdraws from the Plan as provided in
Section 8 hereof, or unless the Committee otherwise provides,
such Participant's election to purchase Shares shall be
exercised automatically on the Exercise Date, and the maximum
number of Shares (excluding any fractional Share, for which
purposes the purchase amount shall be rounded to the next
lower whole number of Shares) subject to such option will be
purchased for such Participant at the applicable option price
with the accumulated payroll deductions.
(b) Any cash balance remaining in a Participant's account after
the termination of an Offering Period will be carried forward
to the Participant's account for the purchase of Shares during
the next Offering Period if the Participant has elected to
continue to participate in the Plan. Otherwise the Participant
will receive a cash payment equal to the cash balance of his
or her account.
(c) The Shares purchased upon exercise of an option hereunder
shall be credited to the Participant's account under the Plan
within ten (10) business days after the Exercise Date and
shall be deemed to be transferred to the Participant as of
such crediting date. Except as otherwise provided herein, the
Participant shall have all rights of a shareholder with
respect to credited Shares.
7. DELIVERY OF SHARES.
(a) As promptly as practicable after receipt by the Company of a
written request for withdrawal of Shares from any
Participant's account (or, in the discretion of the Committee,
at any time after the termination of employment of any
Participant), subject to Section 20(d) hereof, the Company
shall arrange the delivery to such Participant of a share
certificate representing the whole Shares credited to the
Participant's account which the Participant requests to
withdraw. Subject to Section 7(b) hereof, withdrawals may be
made no more frequently than once each Offering Period. Shares
received upon share dividends or share splits shall be treated
as having been purchased on the Exercise Date of the Shares to
which they relate.
(b) Notwithstanding anything in Section 7(a) hereof to the
contrary, Shares may be withdrawn by a Participant more than
once during an Offering Period under the following
circumstances: (i) within sixty (60) days following a Change
in Control of the Company or (ii) upon the approval of the
Committee, in its sole discretion.
8. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) A Participant may withdraw at any time all, but not less than
all, cash amounts in his or her account under the Plan that
have not been used to purchase Shares
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by giving written notice to the Company at least thirty (30)
days prior to the next occurring Exercise Date or otherwise as
may be approved by the Committee in its sole discretion. All
such payroll deductions credited to such Participant's account
shall be paid to such Participant promptly after receipt of
such Participant's notice of withdrawal and such Participant's
option for the Offering Period in which the withdrawal occurs
shall be automatically terminated. No further payroll
deductions for the purchase of Shares will be made for such
Participant during such Offering Period.
(b) Upon termination of a Participant's Continuous Status as an
Employee during an Offering Period for any reason, including
voluntary termination, retirement or death, the payroll
deductions credited to such Participant's account that have
not been used to purchase Shares shall be returned to such
Participant or, in the case of such Participant's death, to
the person or persons entitled thereto under Section 12
hereof, and such Participant's option will be automatically
terminated. Notwithstanding the foregoing, upon the
termination of a Participant's employment because of the
Participant's death, the Participant's beneficiary (designated
by the Participant in accordance with Section 12 hereof) shall
have the right to elect, by written notice given to the
Company prior to the earlier of thirty (30) days prior to the
next occurring Exercise Date (or otherwise as may be
determined by the Committee in its sole discretion) under the
Plan or the sixtieth (60th) day after the Participant's death,
to exercise the Participant's option for the purchase of
Shares on such Exercise Date for the purchase of the number of
full Shares which the accumulated payroll deductions in the
Participant's account at the date of the Participant's death
will purchase at the applicable option price, and any excess
in such account will be paid to such beneficiary. If no such
written notice of election is duly received by the Company,
the first sentence of this Section 8(b) shall control.
(c) Except as provided in Section 20(d) hereof, a Participant's
withdrawal from an offering will not have any effect upon such
Participant's eligibility to participate in a succeeding
offering or in any similar plan which may hereafter be adopted
by the Company.
9. INTEREST.
No interest shall accrue on or be payable with respect to the payroll
deductions of a Participant in the Plan.
10. SHARES.
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(a) The maximum number of Shares which shall be reserved for sale
under the Plan shall be 100,000 Shares, which number shall be
subject to adjustment upon Changes in Capitalization of the
Company as provided in Section 16 hereof. Such Shares shall be
either authorized and unissued Shares or Shares which have
been reacquired by the Company. If the total number of Shares
which would otherwise be subject to options granted pursuant
to Section 4 hereof on an Offering Date exceeds the number of
Shares then available under the Plan (after deduction of all
Shares for which options have been exercised or are then
outstanding), the Committee shall make a pro rata allocation
of the Shares remaining available for option grant in as
uniform a manner as shall be practicable and as it shall
determine to be equitable. In such event, the Committee shall
give written notice to each Participant of such reduction of
the number of option Shares affected thereby and shall
similarly reduce the rate of payroll deductions, if necessary.
(b) Shares to be delivered to a Participant under the Plan will be
registered in the name of the Participant or, at the election
of the Participant, in the name of the Participant and another
person as joint tenants with rights of survivorship.
(c) Until Shares shall have been credited to a Participant's
account in accordance with Section 6(c) hereof, the
Participant shall not have any rights or privileges of a
shareholder with respect to any Shares purchasable hereunder.
11. ADMINISTRATION.
The Plan shall be administered by the Committee, and the Committee may
select administrator(s) to whom its duties and responsibilities hereunder may be
delegated. The Committee shall have full power and authority, subject to the
provisions of the Plan, to promulgate such rules and regulations as it deems
necessary for the proper administration of the Plan, to interpret the provisions
and supervise the administration of the Plan, and to take all action in
connection therewith or in relation thereto as it deems necessary or advisable.
Any decision evidenced by the unanimous written consent of the members of the
Committee shall be fully effective as if it had been made at a meeting duly
held. Except as otherwise provided by the Committee, each Employer shall be
charged with all expenses incurred in the administration of the Plan with
respect to such Employer's Employees. No member of the Committee shall be
personally liable for any action, determination, or interpretation made in good
faith with respect to the Plan, and all members of the Committee shall be fully
indemnified by the Company with respect to any such action, determination or
interpretation. All decisions, determinations and interpretations of the
Committee shall be final and binding on all persons, including the Company, the
Participant (or any person claiming any rights under the Plan from or through
any Participant) and any shareholder.
12. DESIGNATION OF BENEFICIARY.
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(a) A Participant may file with the Company, on forms supplied by
the Company, a written designation of a beneficiary who is to receive any Shares
and cash remaining in such Participant's account under the Plan in the event of
the Participant's death.
(b) Such designation of beneficiary may be changed by the
Participant at any time by written notice to the Company, on forms supplied by
the Company. In the event of the death of a Participant and in the absence of a
beneficiary validly designated under the Plan who is living at the time of such
Participant's death, the Company shall deliver such Shares and/or cash to the
spouse or to any one or more dependents or relatives of the Participant in
accordance with the applicable laws of descent and distribution, or if no
spouse, dependent or relative is known to the Company, then to such other person
as the Company may designate.
13. TRANSFERABILITY.
Neither payroll deductions credited to a Participant's account nor any
rights with regard to the exercise of an option or to receive Shares under the
Plan may be assigned, transferred, pledged or otherwise disposed of in any way
by the Participant (other than by will, the laws of descent and distribution or
as provided in Section 12 hereof). Any such attempt at assignment, transfer,
pledge or other disposition shall be without effect, except that the Company may
treat such act as an election to withdraw funds in accordance with Section 8
hereof.
14. USE OF FUNDS.
All payroll deductions received or held by the Company under the Plan
may be used by the Company for any corporate purpose, and the Company shall not
be obligated to segregate such funds.
15. REPORTS.
Individual accounts will be maintained for each Participant in the
Plan. Statements of account will be given to Participants as soon as practicable
following each Offering Period, which statements will set forth the amounts of
payroll deductions, dividends, dividend reinvestments and additional cash
payments, the per Share purchase price, the number of shares purchased, the
aggregate Shares in the Participant's account and the remaining cash balance, if
any.
16. EFFECT OF CERTAIN CHANGES.
(a) In the event of a Change in Capitalization or the distribution
of an extraordinary dividend, the Committee shall conclusively
determine the appropriate equitable adjustments, if any, to be
made under the Plan, including without limitation adjustments
to the number of Shares which have been authorized for
issuance under the Plan but have not yet been placed under
option, as well as the price per Share covered by each option
under the Plan which has not yet been
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exercised. In the event of a Change in Control of the Company,
the Offering Period shall terminate unless otherwise provided
by the Committee. For purposes of the preceding sentence, (i)
the Committee may establish the date of the event constituting
the Change of Control and such date shall be the Exercise Date
for such Offering Period, or (ii) the Committee may terminate
the Plan in which case all Shares and cash amounts in a
Participant's account shall be refunded as elsewhere provided
herein.
(b) "Change of Control" shall be deemed to have occurred if (i) a
tender offer shall be made and consummated for the ownership
of 25% or more of the outstanding voting securities of the
Company, (ii) the Company shall be merged or consolidated with
another corporation and as a result of such merger or
consolidation less than 50% of the outstanding voting
securities of the surviving or resulting corporation shall be
owned in the aggregate by the former shareholders of the
Company, (iii) the Company shall sell at least 75% of its
assets by value in a single transaction or in a series of
transactions to another corporation which is not a wholly
owned subsidiary of the Company, or (iv) a person, within the
meaning of Section 3(a)(9) or of Section 13(d)(3) (as in
effect on the date hereof) of the Exchange Act, shall acquire
50% or more of the outstanding voting securities of the
Company (whether directly, indirectly, beneficially or of
record). For purposes hereof, ownership of voting securities
shall take into account and shall include ownership as
determined by applying the provisions of Rule 13d-3(d)(1)(i)
(as in effect on the date hereof) pursuant to the Exchange
Act.
17. TERM OF PLAN.
Subject to the Board's right to discontinue the Plan (and thereby end
its Term) pursuant to Section 18 hereof, the Term of the Plan (and its last
Offering Period) shall end on December 31, 2008. Upon any discontinuance of the
Plan, unless the Committee shall determine otherwise, any assets remaining in
the Participants' accounts under the Plan shall be delivered to the respective
Participant (or the Participant's legal representative) as soon as practicable.
18. AMENDMENT TO AND DISCONTINUANCE OF PLAN.
(a) Subject to Section 18(b) hereof, the Board may at any time
amend, suspend or discontinue the Plan. Except as provided in
Section 16 hereof, no such suspension or discontinuance may
adversely affect options previously granted and no amendment
may make any change in any option theretofore granted which
adversely affects the rights of any Participant which accrued
prior to the date of effectiveness of such amendment without
the consent of such Participant. No amendment shall be
effective unless it receives the requisite approval of the
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shareholders of the Company if such shareholder approval of
such amendment is required to comply with Rule 16b-3 under the
Exchange Act or Section 423 of the Code or to comply with any
other applicable law, regulation or stock exchange rule.
(b) For the purpose of complying with changes in the Code or
ERISA, the Board may amend, modify, suspend or terminate the
Plan at any time. For the purpose of meeting or addressing any
other changes in legal requirements or any other purpose, the
Board may amend, modify, suspend or terminate the Plan only
once every six months. Subject to changes in law or other
legal requirements, including any provisions of Rule 16b-3
under the Exchange Act that would permit otherwise, the Plan
may not be amended without the consent of the holders of a
majority of the shares of Common Stock then outstanding or the
vote of the shareholders of the Company as provided in Section
20(c) hereof, to (i) increase materially the aggregate number
of shares that may be issued under the Plan (except for
adjustments pursuant to Section 16 of the Plan); (ii) increase
materially the benefits accruing to Participants under the
Plan; or (iii) modify materially the requirements as to
eligibility for participation in the Plan.
19. NOTICES.
All notices or other communications by a Participant to the Company
under or in connection with the Plan shall be deemed to have been duly given
when received in the form specified by the Company at the location, or by the
person, designated by the Company for the receipt thereof.
20. REGULATIONS AND OTHER APPROVALS; GOVERNING LAW; SECTION 16 COMPLIANCE
(a) This Plan and the rights of all persons claiming hereunder
shall be construed and determined in accordance with the laws
of the State of Florida without giving effect to the choice of
law principles thereof, except to the extent that such law is
preempted by federal law.
(b) The obligation of the Company to sell or deliver Shares with
respect to options granted under the Plan shall be subject to
all applicable laws, rules and regulations, including all
applicable federal and state securities laws, and the
obtaining of all such approvals by governmental agencies as
may be deemed necessary or appropriate by the Committee.
(c) To the extent applicable hereto, the Plan is intended to
comply with Rule 16b-3 under the Exchange Act, and the
Committee shall interpret and administer the provisions of the
Plan in a manner consistent therewith. Any provisions
inconsistent with such Rule shall be inoperative and shall not
affect the validity
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of the Plan. This Plan shall be subject to approval by
shareholders of the Company owning a majority of the issued
outstanding shares of common stock present or represented and
entitled to vote at a meeting duly held in accordance with
applicable law.
(d) For any Participants subject to Section 16 of the Exchange
Act, (i) such Participants who cease participation in the Plan
may not participate again for at least six (6) months, and
(ii) unless the Committee otherwise determines after due
regard for Rule 16b-3(d)(2)(i), any Shares purchased by such
Participant shall remain in such Participant's account for six
(6) months from the Exercise Date for such Shares.
(e) Shares shall not be issued unless such issuance and delivery
shall comply with all applicable provisions of law, domestic
or foreign, and the requirements of any stock exchange upon
which the Shares may then be listed, including, in each case
the rules and regulations promulgated thereunder, and shall be
further subject to the approval of counsel for the Company
with respect to such compliance, which may include a
representation and warranty from the Participant that the
Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares.
(f) Nothing contained in this Plan, or any modification or
amendment to the Plan, or in the creation of any account, or
the execution of any subscription agreement, or the issuance
of any Shares under the Plan, shall give any Employee any
right to continue employment or any legal or equitable right
against the Company or any Subsidiary, or any officer,
director, or employee thereof, except as expressly provided by
the Plan.
21. WITHHOLDING OF TAXES.
By electing to participate in the Plan, each Employee acknowledges that
the Company and its participating Subsidiaries are required to withhold taxes
with respect to the amounts deducted from the Employee's Compensation and
accumulated for the benefit of the Employee under the Plan, and each Employee
agrees that the Company and its participating Subsidiaries may deduct additional
amounts from the Employee's Compensation, when amounts are added to the
Employee's Account, used to purchase common stock or refunded, in order to
satisfy such withholding obligations. If the Participant makes a disposition,
within the meaning of Section 424(c) of the Code and regulations promulgated
thereunder, of any Share or Shares issued to such Participant pursuant to such
Participant's exercise of an option, and such disposition occurs within the
two-year period commencing on the day after the Offering Date or within the
one-year period commencing on the day after the Exercise Date, such Participant
shall, within ten (10) days of such disposition, notify the Company thereof and
thereafter immediately deliver to the Participant's Employer any amount of
federal, state or local income taxes and other amounts which the Company informs
the Participant the Company is required to withhold. The Participant's Employer
may also satisfy any applicable withholding amounts
B-12
<PAGE> 38
by deducting the necessary amounts of withholding from the Participant's wages
and, in the Committee's sole discretion, any other amounts owed to or held for
the account of the Participant.
22. EFFECTIVE DATE.
The Plan shall be effective (the "Effective Date") as of the latter to
occur of (a) July 1, 1998 or (b) the date on which each of the following shall
have occurred: (i) this Plan shall have been approved by the shareholders as set
forth in Section 20(c) hereof and (ii) a registration statement for the Plan
shall have become effective under the Securities Act of 1933, as amended.
B-13
<PAGE> 39
APPENDIX
PROXY SOLICITED FOR ANNUAL MEETING
OF SHAREHOLDERS OF
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
TO BE HELD MAY 22, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby constitutes and appoints DENNIS A. BAKAL and
LINDA K. ROBERTS and each of them, his true and lawful agents and proxies with
full power of substitution in each, to represent and vote, as indicated below,
all of the shares of Common Stock of Professional Transportation Group Ltd.,
Inc. ("PTG") that the undersigned would be entitled to vote at the 1998 Annual
Meeting of Shareholders of PTG to be held at the offices of Nelson Mullins Riley
& Scarborough, L.L.P., 999 Peachtree Street, N.E., Suite 1400, Atlanta, Georgia
on Friday, May 22, 1998 at 10:00 a.m., local time, and at any adjournment, upon
the matters described in the accompanying Notice of Annual Meeting of
Shareholders and Proxy Statement, receipt of which is acknowledged, and upon any
other business that may properly come before the meeting or any adjournment.
Said proxies are directed to vote on the matters described in the Notice of
Annual Meeting of Shareholders and Proxy Statement as follows, and otherwise in
their discretion upon such other business as may properly come before the
meeting or any adjournment thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR ALL NOMINEES TO THE BOARD OF DIRECTORS, FOR THE PROPOSAL TO AMEND
THE PROFESSIONAL TRANSPORTATION GROUP LTD., INC. 1996 STOCK OPTION PLAN, FOR THE
PROPOSAL TO ADOPT THE PROFESSIONAL TRANSPORTATION GROUP LTD., INC. 1998 EMPLOYEE
STOCK PURCHASE PLAN AND AS THE PROXY HOLDER MAY DETERMINE IN HIS OR HER
DISCRETION WITH REGARD TO ANY OTHER MATTER PROPERLY BROUGHT BEFORE THE MEETING.
PLEASE MARK, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
1. Election of Directors:
Dennis A. Bakal
Linda K. Roberts
Peter C. Roth
Robert E. Altenbach
Gregory G. Hardwick
[ ] FOR all nominees [ ] WITHHOLD AUTHORITY to
listed (except vote for all nominees voted
as marked to
the contrary)
<PAGE> 40
(INSTRUCTION: To withhold authority to vote for any individual
nominee(s), write that nominee's name(s) in the space provided below.)
2. Proposal to amend the Professional Transportation Group Ltd., Inc. 1996
Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to adopt the Professional Transportation Group Ltd., Inc. 1998
Employee Stock Purchase Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. IN THEIR DISCRETION, to act upon such other business as may properly
come before the meeting or any adjournment thereof.
Dated: , 1998
---------------------
- ------------------------------------------
Signature of Shareholder(s)
- ------------------------------------------
Signature of Shareholder(s)
Please sign exactly as name or names appear
hereon. Where more than one owner is shown,
each should sign. Persons signing in a
fiduciary or representative capacity shall
give full title. If a corporation, please
sign in full corporate name by authorized
officer. If a partnership, please sign in
partnership name by authorized person.
