<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to ________________
Commission File No. 000-22571
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
--------------------------------------------
(Exact name of registrant as specified in its charter)
Georgia 58-1915632
------- -------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
1950 Spectrum Circle, Suite B-100, Marietta, Georgia 30067
----------------------------------------------------------
(Address of principal executive offices)
(678) 264-0400
--------------
(Registrant's telephone number, including area code)
Not Applicable
--------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the registrant has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
past 12 months (or for such shorter period that the registrant was required to
file such reports), and has been subject to such filing requirements for the
past 90 days.
Yes [X] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:
Common Stock, no par value per share, 4,474,757 shares issued and
outstanding as of November 12, 1999.
Redeemable Common Stock Purchase Warrants, 1,437,500 issued and
outstanding as of November 12, 1999.
Transitional Small Business Disclosure Format (check one):
YES [ ] NO [X]
<PAGE> 2
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 1999
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
INDEX
<TABLE>
<CAPTION>
Page
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<S> <C> <C>
PART I FINANCIAL INFORMATION
ITEM 1. Financial Statements
Consolidated Balance Sheets as of September 30, 1999 and December 31, 1998......................3
Consolidated Statements of Operations for the three months and nine months
Ended September 30, 1999 and 1998...............................................................4
Consolidated Statements of Cash Flows for the nine months ended
September 30, 1999 and 1998 ....................................................................5
Notes to the Consolidated Financial Statements..................................................6
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operation............8
PART II OTHER INFORMATION
ITEM 1. Legal Proceedings..............................................................................12
ITEM 6. Exhibits and Reports on Form 8-K...............................................................14
Signatures.....................................................................................15
</TABLE>
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements -
PROFESSIONAL TRANSPORTATION GROUP LTD., INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
September 30, 1999 and December 31, 1998
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------ ------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ (173,644) $ 1,003,783
Trade accounts receivable, net of allowance for doubtful accounts of
$811,765 at September 30, 1999 and $757,765 at December 31, 1998 10,206,201 6,633,732
Due from affiliate 429,365 429,365
Due from shareholder 183,443 577,197
Prepaid expenses 617,674 662,176
Other current assets 775,624 583,311
------------ ------------
Total current assets 12,038,663 9,889,564
PROPERTY AND EQUIPMENT, net 6,225,523 6,940,060
NONCURRENT NOTES AND RECEIVABLES 3,010,754 2,831,248
OTHER ASSETS 130,289 157,847
------------ ------------
Total assets $ 21,405,229 $ 19,818,719
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 4,656,038 $ 3,226,222
Accrued liabilities 3,403,922 3,074,145
Note payable 300,000 --
Line of credit 6,486,289 6,666,722
Current maturities of long-term debt and capital lease obligations 1,570,136 1,487,025
------------ ------------
Total current liabilities 16,416,385 14,454,114
------------ ------------
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, net of
current maturities 2,951,457 4,268,887
------------ ------------
DEFERRED INCOME TAXES 237,209 237,209
------------ ------------
SHAREHOLDERS' EQUITY:
Preferred stock; 100,000 shares authorized, no shares issued and outstanding -- --
Common stock; no par value, 20,000,000 shares authorized, 4,474,757 and
3,868,160 shares issued and outstanding at September 30, 1999 and
December 31, 1998, respectively -- --
Common stock purchase warrants 353,867 353,867
Additional paid-in capital 6,250,039 5,711,466
Accumulated deficit (4,803,728) (5,206,824)
------------ ------------
Total shareholders' equity 1,800,178 858,509
------------ ------------
Total liabilities and shareholders' equity $ 21,405,229 $ 19,818,719
============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
3
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PROFESSIONAL TRANSPORTATION GROUP LTD., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months and Nine Months Ended September 30, 1999 and 1998
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
----------------------------------- -----------------------------------
1999 1998 1999 1998
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
OPERATING REVENUES $ 11,491,398 $ 11,329,329 $ 33,198,292 $ 45,126,373
------------ ------------ ------------ ------------
OPERATING EXPENSES:
Salaries, wages and benefits 5,104,824 5,120,984 14,751,953 21,029,781
Purchased transportation 1,282,794 1,398,754 3,710,547 5,173,842
Operating supplies and expenses 2,223,870 1,951,818 6,687,025 9,133,680
Fuel and fuel taxes 1,425,480 1,284,776 3,807,383 5,780,725
Communications and utilities 154,410 231,350 595,619 1,007,839
Depreciation 242,484 188,111 730,377 716,919
Operating taxes and licenses 90,995 161,141 324,576 513,320
Bad debt expense 18,000 3,000 54,000 59,000
Other operating expenses 554,081 685,580 1,595,718 2,744,086
------------ ------------ ------------ ------------
Total operating expenses 11,096,938 11,025,514 32,257,198 46,159,192
INCOME (LOSS) FROM OPERATIONS 394,460 303,815 941,094 (1,032,819)
OTHER INCOME (EXPENSE):
Interest expense (265,007) (354,184) (769,156) (873,522)
Other income, net 64,984 86,436 231,160 241,343
------------ ------------ ------------ ------------
INCOME (LOSS) BEFORE
INCOME TAXES 194,437 (36,067) 403,098 (1,664,998)
PROVISION FOR INCOME TAXES -- -- -- --
NET INCOME (LOSS) $ 194,437 $ 36,067 $ 403,098 $ (1,664,998)
============ ============ ============ ============
NET LOSS PER COMMON SHARE - basic $ 0.04 $ .01 $ 0.10 $ (0.43)
============ ============ ============ ============
Weighted average common and common
equivalent shares outstanding - basic 4,467,428 3,867,850 4,217,464 3,867,701
============ ============ ============ ============
NET LOSS PER COMMON SHARE - diluted $ 0.04 $ .01 $ 0.08 $ (0.43)
============ ============ ============ ============
Weighted average common and common
equivalent shares outstanding - diluted 5,167,287 4,624,482 5,047,602 3,867,701
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
4
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PROFESSIONAL TRANSPORTATION GROUP LTD., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 1999 and 1998
<TABLE>
<CAPTION>
Nine Months
Ended September 30,
---------------------------------
1999 1998
CASH FLOWS FROM OPERATING ACTIVITIES: (Unaudited)
<S> <C> <C>
Net income (loss) $ 403,098 $(1,664,998)
----------- -----------
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities:
Depreciation and amortization 730,377 716,919
Changes in operating assets and liabilities:
Trade accounts receivable, net (3,572,469) 2,398,203
Due from affiliate -- 29,250
Other current assets (147,811) (1,309,516)
Accounts payable and accrued liabilities 1,759,593 386,440
----------- -----------
Total adjustments (1,230,310) 2,221,296
----------- -----------
Net cash (used in) provided by operating activities (827,212) 556,298
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (15,840) (2,861,532)
Increase in other assets (151,948) (514,248)
----------- -----------
Net cash used in investing activities
(167,788) (3,375,780)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from (repayment of) line of credit (180,433) 168,000
Repayments of long-term debt and capital lease obligations (906,069) (1,031,901)
Proceeds from long-term debt -- 2,828,763
Proceeds from short-term note receivable
300,000 --
Net proceeds from sale of common stock and common stock
purchase warrants 210,321 2,286
Due from shareholder 393,754 --
----------- -----------
Net cash provided by (used in) financing activities (182,427) 1,967,958
----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (1,177,427) (851,524)
CASH AND CASH EQUIVALENTS, beginning of period 1,003,783 1,422,732
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ (173,644) $ 571,208
=========== ===========
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
5
<PAGE> 6
PROFESSIONAL TRANSPORTATION GROUP LTD., INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1999 and 1998
1. ORGANIZATION AND OPERATION
Professional Transportation Group Ltd., Inc. ("PTG, Ltd.") serves as a
holding company for its three operating subsidiaries: Timely Transportation,
Inc. ("Timely"), Truck-Net, Inc. ("Truck-Net) and PTG, Inc. (collectively, the
"Subsidiaries"). PTG, Ltd. together with the Subsidiaries is hereafter referred
to as the "Company." The Company, through the Subsidiaries, provides
transportation and logistics services primarily for the air freight and
expedited delivery and floor covering industries throughout the continental
United States. Timely operates a fleet of company-owned and leased vehicles to
provide time-definite truckload transportation services for companies in the
air freight, expedited delivery and floor covering markets. Truck-Net provides
brokerage services to companies, mainly in the air freight industry, that are
in need of third-party transportation. PTG, Inc. provides third-party logistics
services in recovering copiers, fax machines, and telephone equipment that are
in need of repair or under expired leases. In September 1999, the Company
entered into an agreement to discontinue operating PTG Inc.'s courier division
and to sell certain assets to Central Delivery Service of Washington, Inc. The
purchase price is a specified percentage of revenues generated by PTG, Inc.
customers for the two year period after closing.
FINANCIAL CONDITION
The Company had a working capital deficit of $4.4 million at September
30, 1999, which includes a liability of $6.5 million under the Company's line
of credit agreement. Management is currently negotiating an extension of its
line of credit agreement and expects that if it is unable to extend the line of
credit, it will seek additional third-party financing to satisfy its
anticipated cash requirements through 1999. There can be no assurance that the
Company will be successful in obtaining an extension of its credit agreement or
in arranging alternative financing under commercially reasonable terms or at
all. If the Company is not successful in negotiating a satisfactory outcome,
there is doubt about the Company's ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION
The accompanying financial statements include the accounts of PTG,
Ltd. and the Subsidiaries. All significant inter-company balances and
transactions have been eliminated.
INCOME TAXES
Net operating loss carryforwards will be utilized to fully offset
income generated in the first nine months of 1999. Therefore, no income tax
provision was recorded.
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3. BASIS OF PRESENTATION
In the opinion of management, the unaudited consolidated financial
statements contain all normal and recurring adjustments necessary to present
fairly the consolidated financial position of the Company at September 30, 1999
and the consolidated results of the Company's operations for the three month
and nine month periods ended September 30, 1999 and 1998. Certain information
and footnote disclosures usually found in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted. Operating results for the interim periods are not necessarily
indicative of the results that may be expected for the year ended December 31,
1999.
4. RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform with the
current year presentation.
5. BUSINESS SEGMENT INFORMATION
The following table summarizes revenues and operating income by business
segment for the nine months ended September 30, 1999 and 1998:
<TABLE>
<CAPTION>
TIMELY AND
TIMELY NORTH TRUCK-NET PTG, INC. TOTAL
------------ --------- --------- ----------
<S> <C> <C> <C> <C>
1999:
Revenues from external customers 29,185,640 5,850,028 502,851 35,538,519
Intersegment revenues 2,016,473 323,754 0 2,340,227
Operating profit 724,730 328,040 78,227 1,130,997
1998:
Revenues from external customers 39,658,125 5,915,741 (128,234) 46,002,055
Intersegment revenues 766,874 108,808 0 875,682
Operating profit (loss) (529,798) 201,759 (128,234) (456,273)
</TABLE>
The following table reconciles segment profit (loss) to consolidated income for
the nine months ended September 30, 1999 and 1998:
<TABLE>
<CAPTION>
1999 1998
---------- ----------
<S> <C> <C>
Total operating profit (loss) for reportable segments 1,130,997 (456,273)
Interest expense (769,156) (873,522)
Salaries, wages and benefits 0 (345,631)
Other unallocated amounts 41,257 10,428
---------- ----------
Total consolidated net income (loss) 403,098 (1,664,998)
---------- ----------
</TABLE>
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following analysis of the Company's financial condition as of
September 30, 1999 and the Company's results of operations for the three and
nine month periods ended September 30, 1999 and 1998 should be read in
conjunction with the Company's Consolidated Financial Statements and notes
thereto. The following discussion contains statements which constitute
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. These statements appear in a number of places in this
Quarterly Report and include all statements that are not statements of
historical fact regarding the intent, belief or current expectations of the
Company, its directors or its officers with respect to, among other things: (i)
the Company's financing plans; (ii) trends affecting the Company's financial
condition or results of operations (including, but not limited to, its ability
to extend its credit facility or enter into new arrangements to replace such
facility); (iii) the Company's growth strategy and operating strategy
(including, but not limited to, issues related to Year 2000 compliance); and
(iv) the declaration and payment of dividends. The words "may," "would,"
"could," "will," "expect," "estimate," "anticipate," "believe," "intend,"
"plans," and similar expressions and variations thereof are intended to
identify forward-looking statements. Investors are cautioned that any such
forward-looking statements are not guarantees of future performance and involve
risks and uncertainties, many of which are beyond the Company's ability to
control. Actual results may differ materially from those projected in the
forward-looking statements as a result of various factors. Among the key risks,
assumptions and factors that may affect operating results, performance and
financial condition are the Company's reliance on a small number of customers
for a larger portion of its revenues, fluctuations in its quarterly results,
ability to continue and manage its growth, Year 2000 risks and concerns,
liquidity and other capital resources issues, competition and the other factors
discussed in detail in the Company's filings with the Securities and Exchange
Commission, including the "Risk Factors" section of the Company's Registration
Statement on Form S-3 (Registration Number 333-70985), as declared effective by
the Securities and Exchange Commission on February 5, 1999. The financial
information provided below has been rounded in order to simplify its
presentation. However, the percentages provided below are calculated using the
detailed financial information contained in the Consolidated Financial
Statements and the notes thereto.
OVERVIEW
Through December 31, 1996 the Company, Timely and Truck-Net operated
as three separate entities. At such time, Dennis A. Bakal, the Company's
majority stockholder and then sole director owned all of the shares of Timely
and Truck-Net. Effective January 1, 1997, Mr. Bakal contributed his ownership
in Timely and Truck-Net to the Company, along with his ownership of PTG, a
previously inactive company. On December 31, 1996, PTG acquired certain assets
(subject to certain liabilities), business, operating authorities, names and
customer lists of Rapid Transit ("Rapid"), the courier division of a company
controlled by Mr. Bakal, and certain fixed assets from another company owned by
Mr. Bakal, all in exchange for amounts due the Company, Timely and Truck-Net
from the former corporate owner of Rapid. On June 19, 1997, the Company
completed its initial public offering, which resulted in net proceeds to the
Company of approximately $5.7 million.
Timely, organized in 1991, performs contract truckload ground
transportation services primarily for customers in the air freight and
expedited delivery markets. In November 1995, Timely entered into an agreement
to perform trucking services for FedEx and became one of FedEx's eight core
carriers. Under the core carrier concept, a limited number of carriers are
selected by a shipper to provide scheduled services between points for a
contractually determined period of time. Such agreements specify routes,
pricing (normally determined by route), equipment specifications and
performance standards. In addition, such agreements generally provide for
pricing adjustments based on fuel pricing or changes in cost structure at
predetermined times. For the nine months ended September 30, 1999 and 1998,
FedEx accounted for approximately 38% and 27%, respectively, of the Company's
consolidated revenues. Since the inception of the agreement, the Company has
consistently exceeded the required performance standards under the agreement,
and management anticipates the renewal of the agreement when it expires in May
2000. There can be no assurance, however, that this agreement will be renewed.
In developing its niche in the industry, Timely has concentrated,
since January 1994, on the contract carriage of truckload freight for the air
freight and expedited delivery markets. By concentrating in these markets, the
8
<PAGE> 9
Company has eliminated the need for terminals and has been able to focus its
efforts on acquiring equipment and recruiting drivers and other personnel.
In October 1997, the Company organized Timely North, Inc. in order to
enter into a marketing agreement (the "Marketing Agreement") with Continental
American Transportation, Inc. ("Continental"). Under that agreement, Timely
North, on November 1, 1997, leased or sub-leased from Continental and its two
main operating subsidiaries, Carpet Transport, Inc. and Blue Mack Transport,
Inc., (collectively "CTI"), substantially all of their operating assets and
terminals. In addition, all of the employees of CTI were hired by Timely North
effective November 1, 1997.
The primary business of CTI was the truckload and less-than-truckload
("LTL") cartage of carpet from manufacturing facilities located in north
Georgia to customers primarily located in the eastern and southern United
States. The business was headquartered in Calhoun, Georgia, the heart of the
carpet manufacturing industry in the United States, and served most of the
major carpet mills. The movement of carpet is primarily a one direction
movement with most of the carpet movement being outbound from north Georgia,
making it necessary to find sufficient back-haul business to bring the trucks
back to Georgia at the lowest possible cost. CTI operated 17 remote terminals
to handle the LTL freight it received from the mills. These terminals were
located in 10 states. On November 1, 1997 Timely North began operating these
terminals and began an analysis of the LTL business. In January 1998, Timely
North announced a substantial rate increase to its LTL customers in an attempt
to bring this part of the operation to a profitable level. On March 27, 1998,
Timely North entered into an agreement with CSI/Crown, Inc. ("CSI/Crown"), an
industry competitor and subsidiary of US Xpress Enterprises, Inc., under which
Timely North terminated its LTL operations as of April 1, 1998 and used its
reasonable best efforts to persuade the LTL customers to transfer their
business to CSI/Crown. At the time of termination, all LTL terminals were
closed, employees terminated and equipment and records prepared for return to
the Calhoun location. All terminal location leases were either leased by CTI or
are owned by a former subsidiary of Continental. Neither the Company nor Timely
North is a party to any of the leases or finance contracts entered into by CTI
or Continental.
During the second quarter of 1998, the Company ceased operating Timely
North, which allowed it to eliminate duplicative functions, personnel and
equipment. Timely restructured to discontinue less profitable full truckload
routes and assumed the most profitable carpet routes from Timely North. The
Company believes that this restructuring has improved customer service, lowered
"deadhead" miles and lowered its operating costs.
Truck-Net, a licensed freight broker, performs truckload brokerage
services in the same air freight and expedited delivery markets served by
Timely. As a broker, Truck-Net matches a shipper with a specific routing and/or
equipment need with a carrier able to satisfy the shipper's particular
requirements. All carriers used by Truck-Net are required to be properly
certificated and to have a current certificate of insurance. When logistically
feasible, Truck-Net utilizes Timely's equipment to complete the brokerage
contracts. In 1998 the Company began dedicating a portion of the Timely fleet
to servicing Truck-Net customers.
Truck-Net offers its services to customers on a contract basis. Some
of its services provide specific scheduled runs for a definite time period, and
others provide deliveries on an as needed basis by the shipper. Truck-Net's
largest customer, Panalpina, the U.S. subsidiary of a major European air
freight forwarder, accounted for approximately 10% of the Company's
consolidated operating revenues for the nine months ended September 30, 1999,
as compared to approximately 9% for the nine months ended September 30, 1998.
Since the end of the third quarter of 1999, Panalpina began operating an
in-house truck brokerage service. As a result, Panalpina's traffic through
Truck-Net will decrease significantly. However, Timley has continued to be
offered Panalpina traffic through their brokerage.
RESULTS OF OPERATIONS
Nine Months Ended September 30, 1999 compared to Nine Months Ended September
30, 1998
9
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Operating revenues decreased 26.4%, or $11.9 million, to $33.2 million
in the first nine months of 1999 from $45.1 million for the same period last
year. Timely's revenue decreased $1.5 million to $17.5 million primarily due to
revenues generated from the carpet industry during the second quarter of 1998
which the Company did not operate during the comparable period of 1999. Timely
North revenues included in the nine month period of 1998 were $10.6 million.
Truck-Net and PTG, Inc. recorded revenues of $5.5 million and $502,000,
respectively, in the first nine months of 1999 compared to $5.8 million and
$428,000 in the same period of 1998.
Operating expenses decreased $13.9 million to $32.3 million for the
nine month period ended September 30, 1999 from $46.2 million for the same
period of 1998. Timely accounted for $1.2 million of this decrease, primarily
as a result of lower revenue discussed above, while the discontinuance of
Timely North operations accounted for $11.8 million of the decrease.
Net operating loss carryforwards will be utilized to fully offset
income generated in the first nine months of 1999. Therefore, no provision for
income taxes has been recorded.
The Company's net income increased approximately $2.1 million to net
income of $403,000 for the first nine months of 1999 compared to a net loss of
$1.7 million for the comparable period of 1998, primarily as a result of
discontinuing the Timely North LTL operations on April 1, 1998.
Three Months Ended September 30, 1999 compared to Three Months Ended September
30, 1998
The Company's operating revenues increased approximately $166,000, or
1.5%, to approximately $11.5 million for the three months ended September 30,
1999, from approximately $11.3 million for the three months ended September 30,
1998. Timely's revenues increased $365,000, or 3.4%, to $9.6 million in the
third quarter of 1999 from $9.2 million for the same period in 1998. The
increase in Timely's revenue is attributable to the growth in the agency
division. Timely's agency division, now in its second quarter of operation, is
essentially a cooperative for smaller, time-definite, expedited truckload
carriers whereby the Company bills the agent carrier's customers and collects
the revenues for these shipments. The agent carriers receive economies of scale
by participating with the Company in the purchase of certain overhead and other
items such as maintenance and fuel. The division, currently with four agents,
accounted for approximately $584,000 of Timely's revenue during the quarter.
Truck-Net and PTG recorded revenues of $1.8 million and $115,000, respectively,
in the second quarter of 1999 compared to $2.0 million and $117,000,
respectively, for the same period in 1998.
The Company's operating expenses increased approximately $71,000, or
.6%, to approximately $11.1 million in the three months ended September 30,
1999 from approximately $11.0 million in the three months ended September 30,
1998. The increase in the Company's operating expenses is primarily due to
direct costs associated with the increase in revenue discussed above
The Company's net income was approximately $194,000 for the three
months ended September 30, 1999 compared to net income of $36,000 in the
similar period of 1998.
LIQUIDITY AND CAPITAL RESOURCES
The Company had negative working capital of approximately $4.4 million
at September 30, 1999 compared to negative working capital of $4.6 million at
December 31, 1998. During the fourth quarter of 1998, certain notes and
accounts receivable associated with Timely North's marketing agreement with CTI
were reclassified from current to non-current assets due to the
unpredictability of the time required to settle accounts due to the bankruptcy
of the principal debtors. In addition, the Company's primary credit facility,
which is discussed below, is classified as a current liability.
Net cash used in operating activities totaled approximately $827,000
for the nine month period ended September 30, 1999, compared to net cash
provided of approximately $556,000 in the comparable period ended September 30,
1998. The Company's net receivables increased $3.6 million while accounts
payable and accrued liabilities increased $1.8 million. Cash used in investing
activities decreased to approximately $168,000 in 1999
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from $3.4 million in 1998 primarily due to the acquisition of approximately
$1.1 million of satellite communications equipment and $1.2 million of trailers
during the first nine months of 1998. During the first nine months of 1999, the
Company repaid $906,000 of its obligations under long-term debt and capital
leases and retired approximately $180,000 of its line of credit.
The Company has available a combined $9.0 million line of credit with
a lending institution to provide for the Company's working capital and letter
of credit requirements. The loan is guaranteed by the Company's principal
shareholder and bears interest at a rate equal to 0.75% above the bank's base
rate (as defined in the agreement). At September 30, 1999, the Company had $6.5
million outstanding under the line of credit with no availability remaining
pursuant to the terms of the agreement. This facility, which was originally
scheduled to mature on December 31, 1998, was extended by the bank until
October 31, 1999. The Company is currently in discussions with the bank to
further extend or refinance this facility. However, there can be no assurance
that the Company will be able to further extend or enter into new arrangements
with the bank or another lending institution on terms favorable to the Company,
if at all, which might necessitate that the Company raise additional funds
through the issuance of equity or convertible debt securities. Pursuant to the
loan agreement with the bank, the Company must satisfy certain financial and
other covenants. As of September 30, 1999, the Company was in default under
several non-monetary covenants. The Company has requested from the bank waivers
of compliance with these covenants.
In October 1999 the Company entered into a transaction to
refinance most of the debt on its trailers under a term loan for approximately
$4.3 million. From the proceeds, the Company paid off approximately $3.5
million of long-term debt and $500,000 of the Company's line of credit. The
Company is in negotiations, with its current lender and other financial
institutions, on new credit arrangements to replace or refinance its current
line of credit. The Company believes that these new arrangements, if entered
into will be sufficient to satisfy its contemplated cash requirements over the
next 12 months. The Company's financial requirements will depend upon, among
other things, the growth rate of the Company's business, the amount of cash
generated by operations and the Company's ability to borrow funds or enter into
lease or purchase financing arrangements for the acquisition of new equipment
or for working capital purposes. Should the Company require additional debt or
equity financing to support its operations or to make acquisitions, there can
be no assurance that such additional financing will be available to the Company
on commercially reasonable terms, or at all. If the company is unable to
replace its existing line of credit prior to any extended maturity date, the
Company's business, financial condition and results of operations would be
materially adversely affected. As a result of this uncertainty, the Company's
independent certified public accountants added an explanatory paragraph to
their report on the Company's financial statements for the year ended December
31, 1998 which makes references to the uncertainties regarding the Company's
ability to continue as a going concern. Certain of the statements in this
paragraph are "forward-looking" statements which are subject to the risks and
uncertainties discussed above.
INFLATION
Inflation has not had a material effect on the Company's operations.
If inflation increases, the Company will attempt to increase its rates to
offset its increased expenses. No assurances can be given, however, that the
Company will be able to adequately increase its prices in response to
inflation.
YEAR 2000 ISSUES
The Company's business and relationships with its customers depends
significantly on a number of computer software programs, internal operating
systems and connections to other networks. If any of these software programs,
systems or networks are not programmed to recognize and properly process dates
after December 31, 1999 (the "Year 2000" issue), significant system failures or
errors may result which could have a material adverse effect on the business,
financial condition, or results of operations of both the effected customers
and the Company. The Company has conducted a preliminary review of its internal
accounting and operating programs and systems and currently believes that these
programs and systems and the network connections it maintains are adequately
programmed to address the Year 2000 issue or can be modified or replaced to
address the Year 2000 issue without incurring costs or delays which would have
a material adverse effect on the Company's financial condition. However if the
Company and third parties upon which it relies are unable to address this issue
in a timely manner it could result in a material financial risks to the
Company. The Company plans to devote all resources required to resolve any
significant Year 2000 issues in a timely manner.
11
<PAGE> 12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
An involuntary bankruptcy petition was filed on or about May 26, 1998
against Continental American, the parent corporation of Carpet Transport, Inc.
("CTI"), in the case styled In re: Continental American Transportation, Inc.,
Case No. 98-41900 HR, U.S. Bankruptcy Court for the Northern District of
Georgia (Rome Division). This action was initiated by several parties
purporting to be creditors of Continental American. The involuntary bankruptcy
petition resulted in the appointment of a trustee. The trustee has pursued all
bankruptcy claims against the Company under the CTI Properties, Inc.
bankruptcy. See below.
An involuntary bankruptcy petition was filed on or about August 7,
1998 against CTI Properties, Inc. at one time and perhaps currently a
wholly-owned subsidiary of Continental American, in the case styled In re: CTI
Properties, Inc., Case No. R98-42886-HR, U.S. Bankruptcy Court for the Northern
District of Georgia (Rome Division). The same trustee has been appointed for
both Continental American and CTI Properties. The trustee has filed an
adversary proceeding against the Company asserting that the Company's first
priority security deed may be avoided as a preference. The Company has denied
that its first priority security deed may be avoided, but even if the trustee's
argument is accepted by the court, the Company has title insurance on the
property as well as the personal guarantee of one of the owners of the
property.
On or about June 17, 1998, a lawsuit was filed against Timely North
and the Company in the case styled CIT Finance Group, Inc. v. Timely North,
Inc. and Professional Transportation Group Ltd., Inc., Case No. 98-CV2280-2,
Superior Court of Clayton County, Georgia. This action was filed by a lessor of
rolling stock to CTI. The complaint alleges generally that Timely North and the
Company are indebted to CIT in an amount to be determined at trial, but that
CIT alleges to be approximately $350,000, an amount disputed by the Company.
While neither Timely North nor the Company has had any contractual relationship
with CIT, CIT asserts in its complaint that the use of its rolling stock
entitles CIT to receive from Timely North and the Company the fair rental value
of the rolling stock during the period of time that Timely North used the
rolling stock. Timely North and the Company have timely filed answers to CIT's
complaint, and intend to contest the case vigorously. Discovery in the case is
progressing.
An involuntary bankruptcy petition was filed on or about June 17, 1998
against CTI in the case styled In re: Carpet Transport, Inc., Case No. 98-42224
HR, U.S. Bankruptcy Court for the Northern District of Georgia (Rome Division).
This action was filed by several parties purporting to be creditors of CTI and
alleges among other things that Timely North or its affiliates had collected a
portion of CTI's receivables, that a representative of the Company had caused
CTI's withholding tax payments to the IRS to be diverted to Timely North's
benefit (to pay Form 2290 taxes), and that Timely North had sold portions of
CTI's equipment without an accounting for the sales proceeds. A trustee was
appointed and continues to investigate these potential claims. The trustee has
also questioned the receipt by the Company of a payment for a consulting and
non-competition agreement. The trustee also questioned the fully-secured status
and priority of the Company's September 12, 1997 secured loan to CTI and its
affiliates of $1.5 million. The Company denies that its first priority secured
status should be challenged, but even if this challenge is successful, the
Company has title insurance on the property and a personal guarantee of one of
the owners of the property. The trustee also questioned whether the Company was
entitled to the proceeds of the sale of certain rolling stock formerly leased
by CTI. In the event that the trustee should pursue any of these claims against
the Company or its affiliates, the Company and/or its affiliates will file a
timely response to any such claim denying all of the material allegations and
any liability on its part, and will vigorously defend against any such claim.
On or about July 30, 1998, an action was brought against Timely and
other defendants in the case styled The CIT Group/Equipment Financing, Inc. v.
Timely Transportation, Inc. et al., Case No. 98-14395, Court of Common Pleas of
Montgomery County, Pennsylvania. The plaintiff as a secured creditor of various
defendants other than Timely alleges that those defendants defaulted in their
installment payments to the plaintiff, that the plaintiff sold the collateral
in a foreclosure sale, that the plaintiff has been damaged in the amount of
approximately $151,000, and that Timely is a "successor" to the other
defendants and therefore owes to the plaintiff its damages. Timely was not a
party to any of the documents under which the plaintiff based its case, has
filed a timely answer to the complaint denying all of the material allegations
and any liability on its part, and intends to vigorously defend this action.
Discovery in the case is progressing.
12
<PAGE> 13
On or about September 4, 1998, an action was filed against the
Company, Timely and Timely North in the case styled U.S. Bancorp Leasing &
Financial v. Timely North, Inc., Timely Transportation, Inc. and Professional
Transportation Group Ltd., Inc., Case No. 34611, Superior Court of Gordon
County, Georgia. This action was filed by a lessor of rolling stock to CTI. The
complaint alleges generally that the Company, Timely and Timely North are
indebted to U.S. Bancorp in an amount to be determined at trial. U.S. Bancorp
is seeking $290,534.50, an amount disputed by the Company. While neither
Timely, Timely North nor the Company has had any contractual relationship with
U.S. Bancorp, U.S. Bancorp asserts in its complaint that the use of its rolling
stock entitles it to receive from Timely, Timely North and the Company the fair
rental value of the rolling stock during the period of time that Timely North
used the rolling stock. Timely, Timely North and the Company have filed timely
answers to U.S. Bancorp's complaint, and intend to contest the case vigorously.
Discovery in the case is progressing.
Scott Logistics Corporation v. Timely North, Inc. and Timely
Transportation, Inc., Civil Action File No. 34324, Superior Court of Gordon
County, Georgia. The plaintiff filed suit in response to Timely North's efforts
to collect $9,709.23 due on account from the plaintiff. The plaintiff filed
suit against both Timely North and Timely seeking claims for $8,342.34 for
alleged damages to freight and approximately $60,000 based on allegations of
tortious interference with plaintiff's relationships with one or more of its
customers. Timely and Timely North have filed an answer to the suit and are
vigorously defending against plaintiff's claims. In addition, Timely North has
filed a counterclaim in the amount of $9,709.23 for sums due on account from
the plaintiff.
T.M.B. Inc. v. Timely Transportation Inc. and Timely North, Inc., Case
No. 98-CV-1931, U.S. District Court for the Northern District of Georgia,
Atlanta Division. The plaintiff seeks to recover $99,998.52 for services
rendered and goods supplied. Timely has filed an answer denying liability, and
intends to vigorously defend on the merits. The plaintiff has attempted to add
Professional Transportation Group Ltd., Inc. as a defendant and to bring
additional claims based on alleged breaches of certain equipment leases. The
amount of the plaintiff's additional claims has yet to be determined, but the
court has, thus far, denied the plaintiff's attempts to add such additional
claims. In any event, the Company was not the lessee under the equipment lease
in issue, and intends to vigorously to defend against such claims in the event
an additional lawsuit is filed. The plaintiff has filed a motion for summary
judgement that the Company intends to respond to in a timely manner.
L.T.D. Logistics, Inc. and Arrow Lines Services, Inc. v. Timely
Transportation, Inc., Timely North, Inc. and Professional Transportation Group
Ltd., Inc., Civil Action File No. 981-6827-99, Superior Court of Cobb County,
Georgia. The plaintiffs claim that they are owed $71,328.30 for services
allegedly rendered. The Company filed an answer denying liability and asserting
that the liability, if any, is solely that of Timely North, Inc. In addition,
Timely North, Inc. has asserted setoffs to the plaintiff's claims.
USF&G v. Timely Transportation, et al, Civil Action No. 98A5879-4,
State Court of Cobb County, Georgia. USF&G is seeking recovery in the amount of
$52,229.66 for alleged workers' compensation insurance audit premiums, dating
back to 1994. Timely has filed an answer denying responsibility for such
premiums and intends to vigorously defend this matter.
Gainey Transportation Services, Inc. v. Timely Transportation, Inc.,
Timely North, Inc. and Professional Transportation Group Ltd., Inc., Civil
Action File No. 99-1-5811-99, Superior Court of Cobb County, Georgia. The
plaintiff filed suit claiming that it is owed approximately $65,356.22 for
services rendered. The Company has filed an answer denying liability and
asserting that the liability, if any, is solely that of Timely North.
Client Server Solutions, Inc. v. Professional Transportation Group
Ltd., Inc., Case No. 99-CV-01909D, State Court of Clayton County, Georgia. The
plaintiff seeks to recover approximately $87,448.62 for services allegedly
rendered. The Company disputes the plaintiff's claim and filed an answer
denying liability. It appears that the Company may have counterclaims against
the plaintiff, and counsel if presently investigating such counterclaims, which
will likely be added to the lawsuit in the near future.
The Company is not a party to any other material legal proceedings.
13
<PAGE> 14
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
<TABLE>
<CAPTION>
No. Description
- --- -----------
<S> <C>
3.1 Amended and Restated Articles of Incorporation of the Company
(Incorporated by reference to Exhibit 3.1 from the Company's
Registration Statement on Form SB-2, File No. 333-24619 (the
"Registration Statement") and the Company's Registration Statement on
Form S-3 filed on November 15, 1999.)
3.2 Bylaws of the Company (Incorporated by reference to Exhibit 3.2 from
the Registration Statement) 4.1 Specimen Common Stock Certificate
(Incorporated by reference to Exhibit 4.1 from the Registration
Statement)
4.1 Specimen Common stock Certificate (Incorporated by reference to Exhibit
4.1 from the Registration Statement)
4.2 Specimen Redeemable Warrant Certificate (Incorporated by reference to
Exhibit 4.2 from the Registration Statement)
10.1 Loan Documents Modification Agreement (September 30, 1999) by and
between the Company, Dennis A. Bakal and SouthTrust Bank, N.A.
27.1 Financial Data Schedule (for SEC use only).
</TABLE>
(b) Reports on Form 8-K. No reports were filed on Form 8-K for
the three month period ending September 30, 1999.
14
<PAGE> 15
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
Date: November 12, 1999 By: /s/ Dennis A. Bakal
----------------- ---------------------------
Dennis A. Bakal
President and Chief Executive Officer
(principal executive officer)
Date: November 12, 1999 By: /s/ Susan P. Dial
----------------- ---------------------------
Susan P. Dial
Chief Financial Officer
(principal financial and accounting officer)
15
<PAGE> 1
EXHIBIT 10.1
LOAN DOCUMENTS MODIFICATION AGREEMENT
(September 30, 1999)
THIS LOAN DOCUMENTS MODIFICATION AGREEMENT (hereinafter referred to as
this "Amendment") is made and entered into as of the 30th day of September,
1999, by and among PROFESSIONAL TRANSPORTATION GROUP LTD., INC., a Georgia
corporation, and TIMELY NORTH, INC., a Georgia corporation (hereinafter
collectively referred to as "Borrower"), TRUCK-NET, INC., a Georgia corporation,
TIMELY TRANSPORTATION, INC., a Georgia corporation, PTG, INC., a Georgia
corporation, and DENNIS A. BAKAL, a Georgia resident (hereinafter collectively
referred to as "Guarantors"), and SOUTHTRUST BANK, N.A., a national banking
association (hereinafter referred to as "Lender").
BACKGROUND STATEMENT
Borrower and Lender are parties to that certain Amended, Restated and
Consolidated Commercial Revolving Note dated March 2, 1998, in the original
principal amount of $9,000,000.00 (hereinafter referred to as the "Note", and
the loan evidenced thereby as the "Loan"). The Note is secured by (a) that
certain Amended and Restated General Security Agreement from Borrower and
Guarantors, as "Debtor" therein, to Lender, as "Secured Party" therein, dated
November 19, 1997 (hereinafter referred to as the "Security Agreement"), and (b)
all of the "Loan Documents," as that term is defined in that certain Amended and
Restated Commercial Loan Agreement dated March 2, 1998 (hereinafter referred to
as the "Loan Agreement"). Certain payment and performance obligations of
Borrower provided for in the Note, the Security Agreement, and the other Loan
Documents are guaranteed by Guarantors pursuant to separate Guaranty of Payment
and Performance, each dated November 19, 1997 (hereinafter each referred to as a
"Guaranty"). The Loan Documents have previously been amended pursuant to that
certain Loan Documents Modification Agreement dated June 30, 1998, that certain
Loan Documents Modification Agreement dated September 15, 1998, that certain
Loan Documents Modification Agreement dated October 31, 1998, that certain Loan
Documents Modification Agreement dated December 31, 1998, and that certain Loan
Documents Modification Agreement dated May 31, 1999. Borrower and Lender have
agreed to amend the Note and all of the other Loan Documents, Guarantors have
each agreed to reaffirm their Guaranty, and the parties hereto are entering into
this Amendment to evidence their agreements.
AGREEMENT
FOR AND IN CONSIDERATION of the sum of Ten and No/100 Dollars ($10.00),
the foregoing recitals, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Borrower, Guarantors and
Lender do hereby agree as follows:
1. LOAN BALANCE. The foregoing recitals are true and correct and are
incorporated herein by reference. Borrower and Lender acknowledge and agree that
as of September 30, 1999, the outstanding principal balance of the Note is Six
Million Four Hundred Eighty-Six Thousand Two Hundred Eighty-Eight and 93/100
Dollars ($6,486,288.93).
2. MODIFICATION OF NOTE. The terms of the Note are hereby modified and
amended, effective as September 30, 1999, by deleting the principal and interest
payment schedule set forth in the Note in the paragraph titled "Payment
Schedule" and replacing it with the following:
<PAGE> 2
"PAYMENT SCHEDULE. Principal and interest shall be due and
payable as follows: Interest only on the outstanding principal
amount shall be due and payable monthly, in arrears, beginning
on April 1, 1998, and continuing on the first day of each
month thereafter until maturity. On October 31, 1999, all
unpaid principal, plus accrued and unpaid interest, shall be
due and payable in full."
The purpose of this modification is to extend the maturity date of the Loan to
October 31, 1999.
3. RATIFICATION; EXPENSES. Except as herein expressly modified or
amended, all the terms and conditions of the Note are hereby ratified, affirmed,
and approved. In consideration of Lender agreeing to extend the maturity date of
the Note, Borrower agrees to pay all fees and expenses incurred in connection
with this Amendment.
4. MODIFICATION OF LOAN DOCUMENTS. As of the date hereof, Borrower and
Guarantors hereby reaffirm and restate each and every warranty and
representation set forth in the Loan Documents. The terms of the Loan Documents
are hereby modified and amended, effective as of the date hereof, so that any
reference in any of the Loan Documents (including, without limitation, the Loan
Agreement) to the Note shall refer to the Note as herein amended.
5. GUARANTOR'S REAFFIRMATION. The undersigned Guarantors hereby ratify,
confirm, reaffirm and covenant that the Guaranty which they have executed is
validly existing and binding against them under the terms of such Guaranty.
Guarantors hereby reaffirm and restate, as of the date hereof, all covenants,
representations and warranties set forth in the Guaranty.
6. NO DEFENSES; RELEASE. For purposes of this Paragraph 6, the terms
"Borrower Parties" and "Lender Parties" shall mean and include Borrower and
Guarantors, and Lender, respectively, and each of their respective predecessors,
successors and assigns, and each past and present, direct and indirect, parent,
subsidiary and affiliated entity of each of the foregoing, and each past and
present employee, agent, attorney-in-fact, attorney-at-law, representative,
officer, director, shareholder, partner and joint venturer of each of the
foregoing, and each heir, executor, administrator, successor and assign of each
of the foregoing; references in this paragraph to "any" of such parties shall be
deemed to mean "any one or more" of such parties; and references in this
sentence to "each of the foregoing" shall mean and refer cumulatively to each
party referred to in this sentence up to the point of such reference. Borrower
hereby acknowledges, represents and agrees: that Borrower has no defenses,
setoffs, claims, counterclaims or causes of action of any kind or nature
whatsoever with respect to the Note and the other Loan Documents or the
indebtedness evidenced and secured thereby, or with respect to any other
documents or instruments now or heretofore evidencing, securing or in any way
relating to the Loan, or with respect to the administration or funding of the
Loan, or with respect to any other transaction, matter or occurrence between any
of the Borrower Parties and any Lender Parties or with respect to any acts or
omissions of any Lender Parties (all of said defenses, setoffs, claims,
counterclaims or causes of action being hereinafter referred to as "Loan Related
Claims"); that, to the extent that Borrower may be deemed to have any Loan
Related Claims, Borrower does hereby expressly waive, release and relinquish any
and all such Loan Related Claims, whether or not known to or suspected by
Borrower; that Borrower shall not institute or cause to be instituted any legal
action or proceeding of any kind based upon any Loan Related Claims; and that
Borrower shall indemnify, hold harmless and defend all Lender
-2-
<PAGE> 3
Parties from and against any and all Loan Related Claims and any and all losses,
damages, liabilities, costs and expenses suffered or incurred by any Lender
Parties as a result of any assertion or allegation by any Borrower Parties of
any Loan Related Claims or as a result of any legal action related thereto.
Borrower hereby reaffirms and restates, as of the date hereof, all covenants,
representations and warranties set forth in the Loan Documents.
7. NO NOVATION. Borrower and Lender hereby acknowledge and agree that
this Amendment shall not constitute a novation of the indebtedness evidenced by
the Loan Documents, and further that the terms and provisions of the Loan
Documents shall remain valid and in full force and effect except as may be
hereinabove modified and amended.
8. NO WAIVER OR IMPLICATION. Borrower hereby agrees that nothing
herein shall constitute a waiver by Lender of any default, whether known or
unknown, which may exist under the Note or any other Loan Document. Borrower
hereby further agrees that no action, inaction or agreement by Lender,
including, without limitation, any extension, indulgence, waiver, consent or
agreement of modification which may have occurred or have been granted or
entered into (or which may be occurring or be granted or entered into hereunder
or otherwise) with respect to nonpayment of the Loan or any portion thereof, or
with respect to matters involving security for the Loan, or with respect to any
other matter relating to the Loan, shall require or imply any future extension,
indulgence, waiver, consent or agreement by Lender. Borrower hereby acknowledges
and agrees that Lender has made no agreement, and is in no way obligated, to
grant any future extension, indulgence, waiver or consent with respect to the
Loan or any matter relating to the Loan.
9. NO RELEASE OF COLLATERAL. Borrower further acknowledge and agree
that this Agreement shall in no way occasion a release of any collateral held by
Lender as security to or for the Loan, and that all collateral held by Lender as
security to or for the Loan shall continue to secure the Loan.
10. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon and
inure to the benefit of Borrower, Guarantors and Lender and their respective
heirs, successors and assigns, whether voluntary by act of the parties or
involuntary by operation of law.
11. AUTHORITY. By executing this Amendment as hereinafter provided,
Dennis A. Bakal hereby certifies that he is the President of each Borrower and
is duly authorized to execute this Amendment on behalf of each Borrower.
IN WITNESS WHEREOF, this Amendment has been duly executed under seal by
Borrower, Guarantors and Lender, as of the day and year first above written.
BORROWER:
PROFESSIONAL TRANSPORTATION GROUP LTD.,
INC., a Georgia corporation
By: /s/ Dennis A. Baklal
----------------------------------------
-3-
<PAGE> 4
Dennis A. Bakal, President
[CORPORATE SEAL]
TIMELY NORTH, INC., a Georgia corporation
By: /s/ Dennis A. Bakal
---------------------------------
Dennis A. Bakal, President
[CORPORATE SEAL]
GUARANTORS:
TRUCK-NET, INC., a Georgia corporation
By: /s/ Dennis A. Bakal
---------------------------------
Dennis A. Bakal, President
[CORPORATE SEAL]
TIMELY TRANSPORTATION, INC., a Georgia
corporation
By: /s/ Dennis A. Bakal
---------------------------------
Dennis A. Bakal, President
[CORPORATE SEAL]
/s/ Dennis A. Bakal (SEAL)
------------------------------------
DENNIS A. BAKAL
PTG, INC., a Georgia corporation
By: /s/ Dennis A. Bakal
---------------------------------
Dennis A. Bakal, President
[CORPORATE SEAL]
-4-
<PAGE> 5
LENDER:
SOUTHTRUST BANK, N.A., a national banking
association
By: /s/ Barbara A. Gewert
----------------------------------
Barbara A. Gewert
Vice President
-5-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED INTERIM FINANCIAL STATEMENTS OF PROFESSIONAL TRANSPORTATION GROUP
LTD., INC. FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999, SET FORTH IN THE
ACCOMPANYING FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<EXCHANGE-RATE> 1
<CASH> (173,644)
<SECURITIES> 0
<RECEIVABLES> 11,017,966
<ALLOWANCES> 811,765
<INVENTORY> 0
<CURRENT-ASSETS> 12,038,663
<PP&E> 8,702,814
<DEPRECIATION> 2,477,291
<TOTAL-ASSETS> 21,405,229
<CURRENT-LIABILITIES> 16,416,385
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,800,178
<TOTAL-LIABILITY-AND-EQUITY> 21,405,229
<SALES> 33,198,292
<TOTAL-REVENUES> 33,198,292
<CGS> 0
<TOTAL-COSTS> 32,257,198
<OTHER-EXPENSES> (231,160)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 769,156
<INCOME-PRETAX> 403,098
<INCOME-TAX> 0
<INCOME-CONTINUING> 403,098
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 403,098
<EPS-BASIC> .10
<EPS-DILUTED> .08
</TABLE>
