<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
C.H. ROBINSON WORLDWIDE, 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
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
C.H. ROBINSON WORLDWIDE, INC.
8100 MITCHELL DRIVE
EDEN PRAIRIE, MINNESOTA 55344
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 5, 1998
TO THE STOCKHOLDERS OF C.H. ROBINSON WORLDWIDE, INC.:
Notice is hereby given that the Annual Meeting of Stockholders of C.H.
Robinson Worldwide, Inc. (the "Company") will be held on Tuesday, May 5, 1998
at 9:00 a.m., local time, at the executive offices of the Company located at
8100 Mitchell Road, Eden Prairie, Minnesota, for the following purposes:
1. To elect two directors to serve for three-year terms or until their
respective successors are elected and qualified;
2. To ratify the selection of Arthur Andersen LLP as the Company's
independent public accountants for the fiscal year ending December 31,
1998; and
3. To transact such other business as may properly come before the meeting
or any adjournment thereof.
Only holders of record of the Company's Common Stock as of the close of
business on March 14, 1998 are entitled to notice of and to vote at the
meeting and any adjournment thereof.
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING. WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH NEEDS NO POSTAGE IF MAILED
IN THE UNITED STATES. IF YOU LATER DESIRE TO REVOKE YOUR PROXY, YOU MAY DO SO
AT ANY TIME BEFORE IT IS EXERCISED.
By Order of the Board of Directors
/s/ Owen P. Gleason
Owen P. Gleason
Secretary
April 1, 1998
<PAGE>
C.H. ROBINSON WORLDWIDE, INC.
8100 MITCHELL ROAD
EDEN PRAIRIE, MINNESOTA 55344
----------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
----------------
MAY 5, 1998
This Proxy Statement is furnished in connection with the solicitation of the
enclosed proxy by the Board of Directors of C.H. Robinson Worldwide, Inc. (the
"Company") for use at the Annual Meeting of Stockholders (the "Annual
Meeting") to be held on Tuesday, May 5, 1998, at 9:00 a.m., local time, at the
executive offices of the Company located at 8100 Mitchell Road, Eden Prairie,
Minnesota, and at any adjournment thereof, for the purposes set forth in the
Notice of Annual Meeting of Stockholders. This Proxy Statement and the form of
proxy enclosed are being mailed to stockholders with the Company's Annual
Report to Stockholders commencing on or about April 1, 1998.
Only stockholders of record of the Common Stock, par value $0.10 per share,
of the Company (the "Common Stock") at the close of business on March 14, 1998
will be entitled to vote at the Annual Meeting. As of that date, a total of
41,264,621 shares of Common Stock were outstanding, each share being entitled
to one vote. There is no cumulative voting. The presence at the Annual
Meeting, in person or by proxy, of the holders of a majority of the shares of
Common Stock will constitute a quorum for the transaction of business at the
Annual Meeting. If, however, a quorum is not present or represented at the
Annual Meeting, the stockholders entitled to vote thereat, present in person
or represented by proxy, will have the power to adjourn the Annual Meeting,
without notice other than announcement at the Annual Meeting, until a quorum
shall be present or represented.
Shares of the Company's Common Stock represented by proxies in the
accompanying form, which are properly completed, signed and returned to the
Company prior to the Annual Meeting, and which have not been revoked, will be
voted in the manner directed by a stockholder. If no direction is given, the
proxy will be voted FOR the election of the nominees for director named in
this Proxy Statement and FOR ratification of the selection of Arthur Andersen
LLP as the Company's independent public accountants. A stockholder may revoke
a proxy at any time prior to its exercise by giving to an officer of the
Company a written notice of revocation of the proxy's authority, by submitting
a duly elected proxy bearing a later date or by delivering a written
revocation at the Annual Meeting.
If a stockholder returns a proxy withholding authority to vote the proxy
with respect to a nominee for director, then the shares of the Common Stock
covered by such proxy shall be deemed present at the Annual Meeting for
purposes of determining a quorum and for purposes of calculating the vote with
respect to such nominee, but shall not be deemed to have been voted for such
nominee. If a stockholder abstains from voting as to any matter, then the
shares held by such stockholder shall be deemed present at the Annual Meeting
for purposes of determining a quorum and for purposes of calculating the vote
with respect to such matter, but shall not be deemed to have been voted in
favor of such matter. If a broker returns a "non-vote" proxy, indicating a
lack of authority to vote on such matter, then the shares covered by such non-
vote shall be deemed present at the Annual Meeting for purposes of determining
a quorum but shall not be deemed to be present and entitled to vote at the
Annual Meeting for purposes of calculating the vote with respect to such
matter.
As of the date of this Proxy Statement, the Board of Directors of the
Company knows of no business that will be presented for consideration at the
Annual Meeting other than the matters described in this Proxy Statement. If
any other matters are properly brought before the Annual Meeting, the persons
named in the enclosed form of proxy will vote the proxies in accordance with
their best judgment.
<PAGE>
PROPOSAL ONE: ELECTION OF DIRECTORS
The Board of Directors of the Company is composed of seven members divided
into three classes. The members of each class are elected to serve three-year
terms with the term of office of each class ending in successive years. D.R.
Verdoorn and Barry W. Butzow are the directors in the class whose term expires
at the Annual Meeting. The Board of Directors has nominated Messrs. Verdoorn
and Butzow for election to the Board of Directors at the Annual Meeting for
terms of three years, and each has indicated a willingness to serve. The other
directors of the Company will continue in office for their existing terms.
Looe Baker III, Robert Ezrilov and Owen P. Gleason serve in the class whose
term expires in 1999, and Gerald A. Schwalbach and Dale S. Hanson serve in the
class whose term expires in 2000. Upon the expiration of the term of a class
of directors, directors in such class will be elected for three-year terms at
the annual meeting of stockholders in the year in which such term expires. The
affirmative vote of a majority of the shares of Common Stock present and
entitled to vote at the Annual Meeting is necessary to elect the nominees for
director.
The persons named as proxies in the enclosed form of proxy will vote the
proxies received by them for the election of Messrs. Verdoorn and Butzow,
unless otherwise directed. In the event that any nominee becomes unavailable
for election at the Annual Meeting, the persons named as proxies in the
enclosed form of proxy may vote for a substitute nominee in their discretion
as recommended by the Board of Directors.
Information concerning the incumbent directors is set forth below.
<TABLE>
<C> <S>
D.R. Verdoorn D.R. Verdoorn, 59 years old, has been the
(Nominee with new term President and Chief Executive Officer of the
expiring in 2001) Company and its predecessor since 1977 and a
director since 1975. He has been with the
Company since 1963. He has served on the Boards
of Directors for United Fresh Fruit and
Vegetable Association and the Produce Marketing
Association. Mr. Verdoorn attended Central
College in Pella, Iowa.
Barry W. Butzow Barry W. Butzow, 51 years old, has been a Vice
(Nominee with new term President of the Company since 1984 and a
expiring in 2001) director since 1986. He began employment with
the Company in 1969. He holds a Bachelor of Arts
degree from Moorhead State University.
Looe Baker III Looe Baker III, 48 years old, has been a Vice
(Term expires in 1999) President of the Company since 1979 and a
director since 1984. Mr. Baker began his career
with the Company in 1971. Mr. Baker has served
on the Board of Directors for the Produce
Marketing Association. He is a director of Orval
Kent Holding Co. He holds a Bachelor of Science
degree from Drake University.
Robert Ezrilov Robert Ezrilov, 53 years old, has been a
(Term expires in 1999) director of the Company since 1995. Mr. Ezrilov
has been self-employed as a business consultant
since April 1995. Prior to that, he was a
partner with Arthur Andersen LLP, which he
joined in 1966 subsequent to his obtaining a BSB
degree at the University of Minnesota. Mr.
Ezrilov also serves on the Board of Directors of
Zomax Optical Media, Inc. (a turnkey provider of
CDs and cassettes), and as an advisory board
member to Holiday Companies (a group of related
companies engaged in retailing and wholesaling
grocery, general merchandise and petroleum
products) and L&M Radiator (a replaceable core
radiator manufacturer).
Owen P. Gleason Owen P. Gleason, 46 years old, has been Vice
(Term expires in 1999) President and General Counsel of the Company
since 1990 and served as corporate counsel since
1978. Mr. Gleason has been a director since
1986. Mr. Gleason holds a law degree from
Oklahoma City University and a Bachelor's Degree
from Ripon College.
</TABLE>
2
<PAGE>
<TABLE>
<C> <S>
Gerald A. Schwalbach Gerald A. Schwalbach, 53 years old, has been a
(Term expires in 2000) director of the Company since 1997. He is
currently an officer and director of Two S
Properties, Inc. and Superior Storage, LLC, both
of which are engaged in the business of
operating self-storage and office warehouses.
From 1985 to June 1996, Mr. Schwalbach served as
Executive Vice President of Jacobs Management,
Inc., a management corporation, and from 1996 to
March 1997, as Executive Vice President of IMR
General, Inc., an affiliate of Jacobs
Management, Inc. Prior to joining Jacobs
Management, Inc., Mr. Schwalbach was a tax
partner with Arthur Andersen LLP. Since 1988, he
has been a director of Delta Beverage Group,
Inc., a beverage bottler and distributor. He
graduated from Mankato State University in 1966
with a Bachelor of Science degree.
Dale S. Hanson Dale S. Hanson, 59 years old, has been Vice
(Term expires in 2000) President, Finance and Chief Financial Officer
of the Company since 1990 and a director since
1988. Prior to joining the Company, Mr. Hanson
held various executive positions with First Bank
System, Inc. (now U.S. Bancorp), including
Executive Vice President of First Bank System,
Inc., President of FBS Merchant Banking Group
and President of First Bank of St. Paul. Mr.
Hanson holds a Bachelor of Arts degree from
Carleton College.
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF MESSRS.
VERDOORN AND BUTZOW AS DIRECTORS OF THE COMPANY.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
During 1997, the Board of Directors held five meetings. Each director
holding office during the year attended at least 75% of the total number of
meetings of the Board of Directors (held during the period for which he has
been a director) and committees of the Board on which he served. The Board of
Directors has an Audit Committee and a Compensation Committee, which are
described below. The Company does not have a Nominating Committee.
The Board of Directors established an Audit Committee, effective upon
closing of the Company's initial public offering in October 1997, comprised of
Messrs. Ezrilov and Schwalbach. The Audit Committee is responsible for
nominating the Company's independent public accountants for approval by the
Board of Directors, reviewing the scope, results and costs of the audit with
the Company's independent accountants and reviewing the Company's significant
accounting policies and internal controls. The Audit Committee held two
meetings during 1997.
The Board of Directors has a Compensation Committee that until the closing
of the Company's initial public offering was comprised of Messrs. Verdoorn,
Ezrilov and Schwalbach, and since the closing has been comprised of Messrs.
Ezrilov and Schwalbach. The Compensation Committee is responsible for
determining the compensation and benefits for the executive officers of the
Company and for administering the Company's stock plans. The Compensation
Committee held one meeting during 1997.
3
<PAGE>
COMPENSATION OF DIRECTORS
During 1997, each non-employee director of the Company received $1,500 for
each meeting of the Board of Directors and $750 for each committee meeting
attended, and an annual retainer of $6,000. The Company may pay such fees in
Common Stock. The Company also reimburses non-employee directors for expenses
incurred in attending Board meetings. On October 15, 1997, each non-employee
director of the Company also received a non-qualified stock option to purchase
3,000 shares of Common Stock at a price equal to the initial public offering
price ($18.00) under the Company's 1997 Omnibus Stock Plan (the "Stock
Incentive Plan").
Directors who are also employees of the Company are not separately
compensated for any services provided as a director.
EXECUTIVE COMPENSATION
The following table sets forth all compensation awarded to, earned by or
paid for services rendered to the Company in all capacities during the years
ended December 31, 1997 and 1996, by the Company's Chief Executive Officer and
the four other most highly compensated executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------- -----------------------
RESTRICTED SECURITIES
FISCAL STOCK UNDERLYING ALL OTHER
YEAR SALARY(1) BONUS(2) AWARDS($)(3) OPTIONS(#) COMPENSATION(4)
------ --------- -------- ------------ ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
D.R. Verdoorn........... 1997 $166,132 $332,891 $238,602 13,109 $ -0-
President and Chief 1996 164,276 271,452 197,271 -0- -0-
Executive Officer
Looe Baker III.......... 1997 $114,795 $212,891 $ 79,534 13,109 $12,800
Vice President 1996 111,900 173,764 65,757 -0- 12,000
Barry W. Butzow......... 1997 $ 99,599 $227,891 $ 79,534 13,109 $12,800
Vice President 1996 98,823 179,839 65,757 -0- 12,000
Gregory D. Goven........ 1997 $ 98,400 $216,836 $ 69,592 13,109 $12,800
Vice President 1996 97,924 164,839 57,535 -0- 12,000
Dale S. Hanson.......... 1997 $164,240 $112,891 $ 59,651 13,109 $12,800
Vice President and 1996 163,764 96,075 49,318 -0- 12,000
Chief Financial Officer
Bernard M. Madej(5)..... 1997 $ 98,400 $227,891 $ 69,592 13,109 $12,800
1996 97,924 179,839 57,535 -0- 12,000
</TABLE>
- - --------
(1) Base salary plus amount paid as an automobile allowance.
(2) The Company pays bonuses to executives when both the Company achieves
certain corporate performance objectives and the particular executive
achieves certain objectives established on an annual basis.
(3) In 1997, the Company awarded 282,086 restricted shares to 57 employees,
including 13 executive officers, pursuant to the Company's Central Office
Management Incentive Program ("COMIP"), Profit Center Incentive Program
("PCIP"), and Employee Incentive Program. These grants pertained to fiscal
1996 compensation. Prior to the Company's initial public offering in
October 1997, 87 employees (including the named executive officers) held
an aggregate of 5,968,901 restricted shares under the three programs, all
of which were sold in the Company's initial public offering. Prior to the
closing of the offering, all restrictions were removed. Upon the closing
of the offering, the Employee Incentive Program was terminated, and the
4
<PAGE>
COMIP and PCIP were modified to provide that participants for fiscal 1997
would receive an equivalent amount of cash rather than restricted shares.
The fiscal 1997 amounts were paid in cash to participants in March 1998.
(4) Contributions to the Robinson Companies Retirement and Savings Plan.
(5) Mr. Madej, formerly the Company's Vice President, Logistics, retired as of
October 28, 1997. If Mr. Madej had remained an executive officer through
December 31, 1997, he would have qualified as one of the Company's four
other most highly compensated executive officers.
STOCK OPTIONS
The following tables summarize (i) stock options granted to the executive
officers named in the Summary Compensation Table above during the year ended
December 31, 1997 and (ii) the value of all options held by such persons at
December 31, 1997. No options held by such executive officers were exercised
during the 1997 fiscal year.
OPTION GRANTS IN FISCAL YEAR 1997
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
INDIVIDUAL GRANTS(1) AT ASSUMED ANNUAL
---------------------------------------------- RATES OF STOCK
NUMBER OF % OF PRICE
SECURITIES TOTAL OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM(3)
OPTIONS EMPLOYEES IN PRICE PER EXPIRATION -----------------
NAME GRANTED FISCAL YEAR(2) SHARE DATE 5% 10%
- - ---- ---------- -------------- --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
D.R. Verdoorn........... 13,109 2.8% $18.00 10/15/07 $148,395 $376,063
Looe Baker III.......... 13,109 2.8 18.00 10/15/07 148,395 376,063
Barry W. Butzow......... 13,109 2.8 18.00 10/15/07 148,395 376,063
Gregory D. Goven........ 13,109 2.8 18.00 10/15/07 148,395 376,063
Dale S. Hanson.......... 13,109 2.8 18.00 10/15/07 148,395 376,063
Bernard M. Madej........ 13,109 2.8 18.00 10/15/07 148,395 376,063
</TABLE>
- - --------
(1) The options shown in this table are all incentive stock options granted
pursuant to the Company's Stock Incentive Plan. The options have 10-year
terms and become exercisable in four equal cumulative annual installments
beginning on October 15, 1999.
(2) On October 15, 1997, the Company granted options for an aggregate of
469,677 shares of Common Stock to 253 employees, including the named
executive officers, at an exercise price equal to the initial public
offering price of the Common Stock.
(3) Amounts represent hypothetical gains that could be achieved for the
respective options if exercised at the end of the option term. The 5% and
10% assumed annual rates of compounded stock price appreciation are
mandated by rules of the Commission and do not represent the Company's
estimate or projection of the Company's future Common Stock prices. These
amounts represent certain assumed rates of appreciation in the value of
the Company's Common Stock from the fair value on the date of grant.
Actual gains, if any, on stock option exercises are dependent on the
future performance of the Common Stock and overall stock market
conditions.
5
<PAGE>
AGGREGATED VALUE OF OPTIONS HELD AT DECEMBER 31, 1997
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS HELD AT IN-THE-MONEY OPTIONS HELD
DECEMBER 31, 1997 AT DECEMBER 31, 1997(1)
------------------------- -------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- - ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
D.R. Verdoorn............... -0- 13,109 $-0- $57,352
Looe Baker III.............. -0- 13,109 $-0- $57,352
Barry W. Butzow............. -0- 13,109 $-0- $57,352
Gregory D. Goven............ -0- 13,109 $-0- $57,352
Dale S. Hanson.............. -0- 13,109 $-0- $57,352
Bernard M. Madej............ -0- 13,109 $-0- $57,352
</TABLE>
- - --------
(1) "Value" has been determined based on the difference between the last sale
price of the Company's Common Stock as reported by The Nasdaq National
Market on December 31, 1997 ($22.375) and the per share option exercise
price, multiplied by the number of shares subject to the in-the-money
options.
INDEBTEDNESS OF MANAGEMENT
The Company has made loans to its officers from time to time. All such loans
require that the officer pay interest on an annual basis at the prime rate.
The following table shows for certain of the Company's executive officers and
members of their immediate families the name of such person, the person's
relationship to the Company, the largest aggregate amount of indebtedness
outstanding during the year ended December 31, 1997, and the amount
outstanding on January 31, 1998. The interest rate charged on such loans has
varied from 8.25% to 8.50% over the period from January 1, 1997 through
December 31, 1997 and was 8.50% at January 31, 1998.
<TABLE>
<CAPTION>
MAXIMUM
OUTSTANDING
IN YEAR ENDED OUTSTANDING AT
NAME RELATIONSHIP DECEMBER 31, 1997 JANUARY 31, 1998
- - ---- ----------------- ----------------- ----------------
<S> <C> <C> <C>
D.R. Verdoorn........... Executive Officer $ 55,166 $ -0-
Barry W. Butzow......... Executive Officer 185,000 -0-
Gregory D. Goven........ Executive Officer 112,880 -0-
Michael T. Rempe........ Executive Officer 89,786 -0-
Thomas M. Jostes........ Executive Officer 100,000 -0-
Thomas D. Perdue........ Executive Officer 45,000 30,000
Dale S. Hanson.......... Executive Officer 150,000 -0-
Owen P. Gleason......... Executive Officer 187,401 -0-
Jennifer T. Amys........ Executive Officer 50,000 50,000
John P. Wiehoff......... Executive Officer 40,000 -0-
Suzanne M. Jostes....... Immediate family(1) 18,000 6,000
</TABLE>
- - --------
(1) Ms. Jostes is the sister of Thomas M. Jostes and is an employee of the
Company.
6
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Prior to the Company's initial public offering, the Compensation Committee
of the Board of Directors (the "Compensation Committee") consisted of Messrs.
Verdoorn, Ezrilov and Schwalbach. Since the closing of the offering, the
Compensation Committee has consisted entirely of independent directors. The
Compensation Committee is responsible for determining the compensation and
benefits of the executive officers of the Company. The Compensation Committee
also administers the Company's stock plans, including the Stock Incentive
Plan.
OBJECTIVES AND PHILOSOPHY
The Compensation Committee has adopted a compensation philosophy intended to
achieve the following basic goals: (i) provide a level of total compensation
necessary to attract high quality executives; (ii) provide incentive
compensation based on the alignment of corporate performance objectives and
the interests of the stockholders to achieve further Company growth; (iii)
emphasize team performance; (iv) balance incentive compensation to achieve
both short-term and long-term results; and (v) encourage executives to make
long-term career commitments to the Company and its stockholders through the
Company's compensation programs.
The Compensation Committee reviews market data and assesses the Company's
competitive position in each of the three primary components of executive
compensation: base salary, annual bonus and long-term incentive compensation.
The following descriptions of the primary components of compensation contain
additional detail regarding the Committee's objectives and philosophy. The
Compensation Committee does not allocate a fixed percentage to each of the
three components. Compensation decisions regarding individual executives may
also be based on factors such as individual performance, level of
responsibility, unique skills of the executive and demands of the position.
COMPONENTS OF COMPENSATION
Base salary. Annual base salary is designed to compensate executives for
sustained performance and is intended to provide a minimum guaranteed
compensation. In 1997, base salary levels and annual increases for executive
officers were determined based on an evaluation of the responsibilities of the
position held and the experience of the particular individuals. The Committee
believes that a significant percentage of total compensation should be
variable and incentive based.
Bonus compensation. Prior to the Company's initial public offering,
executives had been awarded restricted stock under the Company's Central
Office Management Incentive Program ("COMIP"), and selected managers of larger
Company profit centers had been awarded restricted stock under the Company's
Profit Center Incentive Program ("PCIP"), without any additional payment, the
amount of which depended upon the achievement of certain growth objectives for
the Company. Participants in the COMIP and PCIP and their percentage
participation were selected prior to the beginning of a fiscal year for
participation for the next three fiscal years. A pool, based on growth in net
profits before taxes and profit sharing, with certain other adjustments, over
the prior year, was established for each year for each program. Each
participant had a percentage participation in the respective pool, and the
value of each pool, as of the end of a year, was paid out in Common Stock in
the following year to participants in the respective pool, based on the book
value of the Common Stock at year end and their relative participations. Under
the Company's Employee Incentive Program, Common Stock had also been awarded
to key employees, without any additional payment. Upon the closing of the
initial public offering, the Employee Incentive Program was terminated, and
the COMIP and PCIP were modified to provide that participants for fiscal 1997
would receive cash rather than restricted shares. The fiscal 1997 amounts were
paid in cash to participants in March 1998. The COMIP and PCIP have been
discontinued for 1998.
The Company's Operational Executive Compensation Plan ("OECP") pays cash
bonuses to executives (including the named executives) when both the Company
achieves certain corporate performance objectives and the particular executive
achieves certain objectives established on an annual basis. The amount
available for such
7
<PAGE>
bonuses increases in relation to the extent to which such objectives are
exceeded. The bonus column of the Summary Compensation Table above contains
the annual incentive payments for 1997 for the Chief Executive Officer and
each of the other named executive officers.
Long-Term Incentive Compensation. Pursuant to the Stock Incentive Plan,
officers, other employees, consultants and eligible independent contractors of
the Company may receive options to purchase Common Stock. The Stock Incentive
Plan provides for the grant of both incentive stock options intended to
qualify for preferential tax treatment under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), and nonqualified stock options
that do not qualify for such treatment. The Stock Incentive Plan also permits
grants of stock appreciation rights, restricted stock and restricted stock
unit awards, performance awards, dividend equivalents and other stock grants
or other stock-based awards.
The Compensation Committee administers the Stock Incentive Plan and approves
awards thereunder. A total of 2,000,000 shares of Common Stock has been
reserved for issuance under the Stock Incentive Plan. In determining the
persons to whom options and awards may be granted and the number of shares
subject to each, the Committee may take into account the nature of services
rendered by the respective employees or consultants, their present and
potential contributions to the success of the Company, and such other factors
as the Committee in its discretion may deem relevant. Non-employee directors
may be granted a nonqualified stock option to purchase shares of Common Stock
on an annual basis.
The Board of Directors may amend or discontinue the Stock Incentive Plan at
any time. The Committee may not alter or impair any award granted under the
Stock Incentive Plan without the consent of the holder of the award except as
otherwise provided in the Stock Incentive Plan or any award agreement. The
Stock Incentive Plan will expire in 2007.
CHIEF EXECUTIVE OFFICER PERFORMANCE EVALUATION AND COMPENSATION
The determination of the Chief Executive Officer's base salary, bonus and
long-term incentive compensation for fiscal 1997 followed the policies set
forth above for all executives' compensation. In the years prior to the
Company's initial public offering, the nonemployee directors of the Company
met annually to privately review Mr. Verdoorn's performance. The Compensation
Committee will continue to conduct a separate performance evaluation in
determining Mr. Verdoorn's compensation.
Mr. Verdoorn became President and Chief Executive Officer in 1977. His
compensation for 1996-1997 is shown in the Summary Compensation Table above.
During 1997, Mr. Verdoorn's base salary was increased 1.13% over 1996 to
$166,132. Mr. Verdoorn received a cash bonus pursuant to the Company's OECP in
the amount of $332,891, and Mr. Verdoorn earned $238,602 under the Company's
COMIP, in recognition of favorable corporate performance and individual
performance. Additionally, Mr. Verdoorn, along with the other named executive
officers, received an option grant for 13,109 shares of Common Stock, with an
exercise price equal to the initial public offering price of the Common Stock.
In the Compensation Committee's judgment, these cash and stock option awards
reflect Mr. Verdoorn's significant contributions to the Company's success
through his vision, leadership and long-term dedication.
COMPENSATION LIMITATIONS
Section 162(m) of the Code generally limits the corporate deduction for
compensation paid to executive officers to $1.0 million, unless the
compensation qualifies as "performance-based compensation" under the Code. The
Committee has reviewed the potential consequences for the Company of Section
162(m) and believes that this provision did not affect the deductibility of
compensation paid to the Company's executive officers in 1997,
8
<PAGE>
and is currently expected to have no impact in 1998. The Committee will
continue to monitor this matter and may propose changes to the executive
compensation program if warranted.
Robert Ezrilov
Gerald A. Schwalbach
Members of the Compensation
Committee
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Compensation Committee are Robert Ezrilov and Gerald A.
Schwalbach. With the exception of D. R. Verdoorn, who served as a member of
the Compensation Committee until the Company's initial public offering in
October 1997, no executive officer of the Company served as a member of the
Compensation Committee or as a director of any other entity, one of whose
executive officers served on the Compensation Committee or as a director of
the Company. No person who served as a member of the Compensation Committee
was a party to any material transaction set forth under "Certain
Transactions," except for Mr. Schwalbach, who purchased from the Company in
August 1997 the Company's interest in a real estate venture, as well as 25,000
shares of Common Stock on June 30, 1997 at book value.
9
<PAGE>
PERFORMANCE GRAPH
The following graph shows a comparison of cumulative total returns for the
Company, the Standard & Poor's 500 Composite Stock Index and the Nasdaq
Transportation Index, assuming the investment of $100 on October 15, 1997 (the
date the Common Stock began trading) and the reinvestment of dividends.
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
10/15/97 12/31/97
-------- --------
<S> <C> <C>
C.H. Robinson Worldwide, Inc............................... $100.00 124.65
Standard & Poor's 500 Composite Stock Index................ 100.00 102.87
Nasdaq Transportation Index................................ 100.00 96.60
</TABLE>
10
<PAGE>
CERTAIN TRANSACTIONS
In December 1996, the Company invested $4,323,000 in a real estate venture.
Gerald A. Schwalbach, a director of the Company, has a substantial interest in
the venture. In August 1997, the investment was sold to Mr. Schwalbach and an
unrelated individual on terms that the Company believes were no less favorable
than what the Company could have received from an unaffiliated third party.
The Company's income on the investment was $595,000.
On June 30, 1997, the Company sold 25,000 shares of Common Stock to Gerald
A. Schwalbach, a director of the Company, for cash in the amount of $103,000
($4.12 per share, the book value of the stock at May 31, 1997).
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of January 31, 1998 by (i) each
person who is known by the Company to own beneficially more than 5% of the
Common Stock, (ii) each director, nominee and executive officer of the Company
named in the Summary Compensation Table under the heading "Executive
Compensation" above and (iii) all directors and executive officers of the
Company as a group. Unless otherwise noted, the stockholders listed in the
table have sole voting and investment powers with respect to the shares of
Common Stock owned by them.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENTAGE OF
BENEFICIALLY OWNED(1) OUTSTANDING SHARES
--------------------- ------------------
<S> <C> <C>
D.R. Verdoorn(2)...................... 3,249,312 7.9%
Looe Baker III(3)..................... 1,838,508 4.5
Barry W. Butzow(4).................... 775,156 1.9
Dale S. Hanson(5)..................... 683,892 1.7
Gregory D. Goven(6)................... 565,454 1.4
Owen P. Gleason(7).................... 492,964 1.2
Bernard M. Madej(8)................... 445,469 1.1
Robert Ezrilov........................ 55,000 *
Gerald A. Schwalbach.................. 25,000 *
All directors and executive officers
as a group (15 persons).............. 8,922,300 21.6
</TABLE>
- - --------
* Less than 1%
(1) Beneficial ownership is determined in accordance with rules of the
Securities and Exchange Commission (the "Commission"), and includes
generally voting power and/or investment power with respect to securities.
Shares of Common Stock subject to options currently exercisable or
exercisable within 60 days of January 31, 1998 ("Currently Exercisable
Options") are deemed outstanding for computing the percentage beneficially
owned by the person holding such options but are not deemed outstanding
for computing the percentage beneficially owned by any other person.
(2) Mr. Verdoorn's address is 8100 Mitchell Road, Eden Prairie, Minnesota
55344. Includes 500,478 shares owned by Mr. Verdoorn's spouse, and 654,757
shares owned by trusts over which he exercises voting and investment
power.
(3) Includes 422,970 shares owned by Mr. Baker's spouse and 360,000 shares
owned by trusts over which he exercises voting and investment power.
(4) Includes 1,000 shares owned by Mr. Butzow's spouse.
(5) Includes 13,000 shares owned by Mr. Hanson's spouse. Mr. Hanson also has
sole voting and investment power with respect to 70,000 shares held by a
family partnership.
(6) Includes 43,589 shares owned by Mr. Goven's spouse and a child living at
home, and 154,000 shares owned by a trust over which he exercises voting
and investment power.
(7) Includes 51,414 shares owned by Mr. Gleason's spouse and children, and
150,000 shares owned by a trust over which he exercises voting and
investment power.
(8) Includes 25,589 shares owned by Mr. Madej's spouse.
11
<PAGE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors and persons who beneficially own more than
10% of the Company's Common Stock to file initial reports of ownership and
reports of changes in ownership with the Commission. Such executive officers,
directors and greater than 10% beneficial owners are required by the
regulations of the Commission to furnish the Company with copies of all
Section 16(a) reports they file.
Based solely on a review of the copies of such reports furnished to the
Company and written representations from the executive officers and directors,
the Company believes that all Section 16(a) filing requirements applicable to
its executive officers and directors and greater than 10% beneficial owners
were complied with, except that statements of changes in beneficial ownership
on Form 4 were not timely filed by each of the executive officers to reflect
the sale of additional shares to the public pursuant to the exercise of a 30-
day option granted to the underwriters in connection with the Company's
initial public offering to cover over-allotments, but such changes were
reported on a timely filed Form 5 for each of the executive officers.
PROPOSAL TWO: SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has selected Arthur Andersen LLP as independent
public accountants for the Company for the fiscal year ending December 31,
1998. A proposal to ratify the appointment of Arthur Andersen LLP will be
presented at the Annual Meeting. Representatives of Arthur Andersen LLP are
expected to be present at the Annual Meeting, will have an opportunity to make
a statement if they desire to do so and will be available to answer
appropriate questions from stockholders. If the appointment of Arthur Andersen
LLP is not approved by the stockholders, the Board of Directors is not
obligated to appoint other accountants, but the Board of Directors will give
consideration to such unfavorable vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE SELECTION
OF ARTHUR ANDERSEN LLP AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS.
SOLICITATION OF PROXIES
The Company is paying the costs of solicitation, including the cost of
preparing and mailing this Proxy Statement. Proxies are being solicited
primarily by mail, but in addition, the solicitation by mail may be followed
by solicitation in person, or by telephone or facsimile, by regular employees
of the Company without additional compensation. The Company will reimburse
brokers, banks and other custodians and nominees for their reasonable out-of-
pocket expenses incurred in sending proxy materials to the Company's
stockholders.
PROPOSALS FOR THE 1999 ANNUAL MEETING
Pursuant to federal securities laws, any proposal by a stockholder to be
presented at the 1999 Annual Meeting of Stockholders and to be included in the
Company's proxy statement must be received at the Company's executive offices,
8100 Mitchell Road, Eden Prairie, Minnesota 55344, no later than the close of
business on December 2, 1998. Proposals should be sent to the attention of the
Secretary. Pursuant to the Company's Bylaws, in order for business to be
properly brought before the 1999 Annual Meeting of Stockholders by a
stockholder, the stockholder must give written notice of such stockholder's
intent to bring a matter before the annual meeting no later than February 4,
1999. Each such notice should be sent to the attention of the Secretary, and
must set forth certain information with respect to the stockholder who intends
to bring such matter before the meeting and the business desired to be
conducted, as set forth in greater detail in the Company's Bylaws.
12
<PAGE>
GENERAL
The Company's Annual Report for the fiscal year ended December 31, 1997 is
being mailed to stockholders together with this Proxy Statement. The Annual
Report is not to be considered part of the soliciting materials.
The information set forth in this Proxy Statement under the caption
"Compensation Committee Report on Executive Compensation" and "Performance
Graph" shall not be deemed to be (i) incorporated by reference into any filing
by the Company under the Securities Act of 1933 or the Securities Exchange Act
of 1934, except to the extent that in any such filing the Company expressly so
incorporates such information by reference, and (ii) "soliciting material" or
to be "filed" with the SEC.
By Order of the Board of Directors
/s/ Owen P. Gleason
Owen P. Gleason
Secretary
April 1, 1998
13
<PAGE>
C.H. ROBINSON WORLDWIDE, INC.
ANNUAL MEETING
C.H. Robinson Worldwide, Inc.
8100 Mitchell Road
Eden Prairie, Minnesota 55344
MAY 5, 1998
9:00 A.M. CENTRAL STANDARD TIME
F Please detach here F
- - --------------------------------------------------------------------------------
[C.H. ROBINSON LOGO]
F Please detach here F
- - --------------------------------------------------------------------------------
UNLESS YOU INDICATE OTHERWISE, THIS PROXY WILL BE VOTED
IN ACCORDANCE WITH THE BOARD OF DIRECTORS'
RECOMMENDATIONS.
1. Election of directors.
[_] FOR all nominees listed below
(except as marked to the contrary below)
[_] WITHHOLD AUTHORITY to vote
for all nominees listed below
D.R. Verdoorn Barry W. Butzow
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ONE OR MORE INDIVIDUAL
NOMINEES, STRIKE A LINE THROUGH THE NOMINEE'S NAME.)
2. Ratification of Selection of Independent Accountants.
[_] FOR [_] AGAINST [_] ABSTAIN
3. In their discretion, consider and act upon such
other matters as may properly come before the
meeting or any adjournments thereof.
------------------------------------
------------------------------------
Signature(s) DATE
This Proxy Card must be Signed
Exactly as Name Appears hereon
When shares are held by joint tenants,
both should sign. When signing as
attorney, executor, administrator, trustee
or guardian, please give full title as
such. If a corporation, please sign in
full corporate name by president or other
authorized officer. If a partnership,
please sign in partnership name by
authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THE
PROXY CARD USING THE ENCLOSED ENVELOPE.
<PAGE>
- - --------------------------------------------------------------------------------
C.H. ROBINSON WORLDWIDE, INC.
8100 MITCHELL ROAD
EDEN PRAIRIE, MINNESOTA 55344
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS
The undersigned hereby appoints D.R. Verdoorn, Dale S.
Hanson and Owen P. Gleason, or any of them, with full
power of substitution to each, as attorneys and proxies
to represent the undersigned at the Annual Meeting of
Stockholders of C.H. Robinson Worldwide, Inc. to be
held in the corporate offices of C.H. Robinson
Worldwide, Inc., 8100 Mitchell Road, Eden Prairie,
Minnesota on the 5th day of May, 1998 at 9:00 a.m.
C.S.T. and at any adjournment(s) thereof, and to vote
all shares of Common Stock which the undersigned may be
entitled to vote at said meeting as directed below with
respect to the proposals as set forth in the Proxy
Statement, and in their discretion upon any other
matters that may properly come before said meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE
ELECTION OF EACH OF THE DIRECTOR NOMINEES LISTED UNDER
PROPOSAL 1 AND FOR PROPOSAL 2. THE TABULATOR CANNOT
VOTE YOUR SHARES UNLESS YOU SIGN AND RETURN THIS PROXY
CARD.
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SEE REVERSE
SIDE
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