<PAGE> 1
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:
<TABLE>
<S> <C>
/ / 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 sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
YELLOW CORPORATION
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
YELLOW CORPORATION
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[LOGO]
YELLOW CORPORATION
10777 Barkley
Overland Park, Kansas 66211
------------------------------
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 19, 1995
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Yellow
Corporation (the "Company") will be held at the Overland Park Marriott, 10800
Metcalf Avenue, Overland Park, Kansas, on April 19, 1995 at 9:30 a.m., Central
Daylight Time, for the following purposes:
<TABLE>
<S> <C>
I. To elect three Class III directors whose three-year terms shall expire at the 1998
Annual Meeting of Stockholders of the Company.
II. To approve the appointment of Arthur Andersen & Co. as independent public
accountants of the Company for 1995.
III. To consider and act upon a stockholder proposal, opposed by management and the
Board of Directors, for confidential voting on matters submitted for stockholder
vote and the appointment of independent inspectors of election.
IV. To transact such other business as may properly come before such meeting or any
adjournment thereof.
</TABLE>
Information regarding the matters to be acted upon at the Annual Meeting is
contained in the accompanying Proxy Statement.
The close of business on February 17, 1995 has been fixed as the record
date for the determination of stockholders entitled to notice of and to vote at
the Annual Meeting or any adjournment thereof.
WHETHER YOU EXPECT TO ATTEND THE MEETING OR NOT, PLEASE COMPLETE, SIGN AND
RETURN THE ACCOMPANYING PROXY SO THAT YOUR SHARES WILL BE REPRESENTED AT THE
MEETING. Return it as promptly as possible in the enclosed envelope. No postage
is required if mailed in the United States.
If you attend the meeting in person, you may revoke your proxy and cast
your vote in person. If you receive more than one proxy because your shares are
held in various names or accounts, each proxy should be completed and returned.
By Order of the Board of Directors:
Overland Park, Kansas WILLIAM F. MARTIN, JR.
March 10, 1995 Secretary
<PAGE> 3
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
YELLOW CORPORATION
10777 Barkley
Overland Park, Kansas 66211
INTRODUCTION
This statement is furnished in connection with the solicitation by the
Board of Directors of Yellow Corporation (the "Company"), a Delaware
corporation, of proxies for use at the 1995 Annual Meeting of Stockholders of
the Company, to be held at the Overland Park Marriott, 10800 Metcalf Avenue,
Overland Park, Kansas (the Company's telephone is 913/967-4300; mailing address
P.O. Box 7563, Overland Park, Kansas 66207), at 9:30 a.m., Central Daylight
Time, on April 19, 1995, and at any and all adjournments thereof. The Company's
Annual Report (including audited financial statements) for the year ended
December 31, 1994 accompanies this Proxy Statement, Notice of Annual Meeting of
Stockholders and form of proxy, which will be mailed to stockholders on or about
March 10, 1995. The Annual Report is not part of this proxy soliciting material
except to the extent specifically incorporated herein by reference. A copy of
the Company's annual report to the Securities and Exchange Commission on Form
10-K and the quarterly reports on Form 10-Q may be obtained without charge by
writing the Treasurer of the Company at the above mailing address.
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING OF THE COMPANY
At the annual meeting, the Company's stockholders will consider and vote
upon (1) the election of three Class III directors whose three-year terms shall
expire at the 1998 Annual Meeting of Stockholders; (2) the approval of the
appointment of Arthur Andersen & Co. as independent public accountants of the
Company for 1995; and (3) a stockholder proposal, opposed by management and the
Board of Directors, for confidential voting on matters submitted for stockholder
vote and the appointment of independent inspectors of election.
VOTING AND PROXIES
RECORD DATE; VOTING RIGHTS
Stockholders of record as of the close of business on February 17, 1995
will be entitled to notice of and to vote at the Annual Meeting of Stockholders
of the Company or any adjournment thereof. On such date the Company had
outstanding 28,105,856 shares of common stock, par value $1.00 per share
("Common Stock"), which constitute the Company's only outstanding voting
securities. Each share of Common Stock has one vote. Unless marked to the
contrary, proxies received will be voted (1) for the election to the Board of
all nominees to the Board of Directors; (2) for the approval of the appointment
of Arthur Andersen & Co. as independent public accountants of the Company for
1995; (3) against the stockholder proposal relating to confidential voting and
the appointment of independent inspectors of election; and (4) in the discretion
of the Proxy Committee on such other business as may properly come before the
meeting.
A stockholder who has given a proxy may revoke it at any time prior to its
exercise at the meeting by filing with the Secretary of the Company an
instrument revoking it or a duly executed proxy bearing a later date, or by
attending the meeting and voting. Attendance at the meeting does not by itself
constitute revocation of the proxy. The election of directors shall be
determined by a plurality of the votes cast. Determination of the appointment of
Arthur Andersen & Co. as independent public accountants and the stockholder
proposal shall be by a majority of the votes cast.
Proxies marked as abstaining (including proxies containing broker
non-votes) on any matter to be acted upon by stockholders will be treated as
present at the meeting for purposes of determining a quorum but will not be
counted as votes cast.
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<PAGE> 4
SOLICITATION OF PROXIES
The cost of the solicitation will be borne by the Company. In addition to
the use of the mails, proxies may be solicited by the directors, officers and
employees of the Company without additional compensation, by personal interview,
telephone, telegram or otherwise. Arrangements may also be made with brokerage
firms and other custodians, nominees and fiduciaries for the forwarding of
soliciting material to the beneficial owners of Common Stock held of record by
such persons. The Company will reimburse such respective brokers, custodians,
nominees and fiduciaries for the reasonable out-of-pocket expenses incurred by
them in connection therewith.
SUBMISSION OF PROPOSALS BY STOCKHOLDERS
Stockholders' proposals intended to be presented at the 1996 annual meeting
must be received by November 10, 1995 to be eligible for inclusion in the proxy
materials.
PRINCIPAL STOCKHOLDERS
As of December 31, 1994, the persons known to the Company to be beneficial
owners of more than five percent of the Company's outstanding shares of Common
Stock, the number of shares beneficially owned by them and by all executive
officers and directors as a group, and the percent of such shares so owned were:
<TABLE>
<CAPTION>
AMOUNT AND NATURE
NAME AND ADDRESS OF BENEFICIAL PERCENT
OF BENEFICIAL OWNER OWNERSHIP OF CLASS
---------------------------------------------------------- ----------------- --------
<S> <C> <C>
George E. Powell, Jr...................................... 2,302,502(1)(3) 8.2%
10777 Barkley
Overland Park, Kansas
George E. Powell III...................................... 1,753,748(2)(3) 6.2%
10777 Barkley
Overland Park, Kansas
Boatmen's Bancshares, Inc. ............................... 3,081,694(4) 11.1%
One Boatmen's Plaza
St. Louis, Missouri
The Capital Group, Inc. .................................. 1,913,200(5) 6.8%
333 South Hope Street
Los Angeles, California
Nicholas Applegate Capital Management..................... 1,451,053(6) 5.2%
600 West Broadway
San Diego, California
Norwest Corporation....................................... 2,795,600(7) 10.1%
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota
Pioneer Management Corporation............................ 1,775,000(8) 6.3%
60 State Street
Boston, Massachusetts
All executive officers and directors as a group........... 2,644,649(9) 9.4%
(18 persons)
</TABLE>
(1) George E. Powell, Jr., Chairman of the Board, had the following voting
and investment powers with respect to such shares: (a) sole voting power,
660,102 shares; (b) shared voting power, 1,608,600 shares; (c) sole investment
power, 660,102 shares; and (d) shared investment power, 1,608,600 shares. Mr.
Powell, Jr. disclaims beneficial ownership of 1,703,428 of such shares, 33,800
of which are owned by his wife, and 1,669,628 of which he holds solely in a
fiduciary capacity.
(2) George E. Powell III, President and Chief Executive Officer, had the
following voting and investment powers with respect to such shares: (a) sole
voting power, 260,274 shares; (b) shared voting power, 1,489,174 shares; (c)
sole investment power, 258,534 shares; and (d) shared investment power,
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<PAGE> 5
1,489,174 shares. Mr. Powell III disclaims beneficial ownership of 1,493,474 of
such shares, 1,453,000 of which are owned by a charitable foundation of which he
is one of five directors, 36,174 of which he holds solely in a fiduciary
capacity under the Missouri Transfer to Minors Law and 4,300 of which are owned
by his wife.
(3) Beneficial ownership of 1,453,000 of such shares is attributed to both
Mr. Powell, Jr. and Mr. Powell III, because they are two of five directors of
The Powell Family Foundation, a private charitable foundation, which owns the
shares. The other directors of the Foundation are Barbara P. Allen, Marilyn P.
Rinker and Nicholas K. Powell.
(4) According to information provided to the Company, Boatmen's Bancshares,
Inc. had the following voting and investment powers with respect to such shares:
(a) sole voting power, 711,650 shares; (b) shared voting power, 4,262 shares;
(c) sole investment power, none; and (d) shared investment power, 2,975,421
shares.
Boatmen's Trust Company, a subsidiary of Boatmen's Bancshares, Inc., held
2,624,429 of such shares as trustee under the Company's Paysop, Stock Sharing,
profit-sharing and pension plans. Participants in the Paysop, Stock Sharing and
profit-sharing plans have the right to instruct the trustee as to the voting of
shares held by the plans and as to whether such shares should be tendered in the
event of a tender offer.
(5) According to information provided to the Company, The Capital Group,
Inc. had, through its operating subsidiaries, Capital Guardian Trust Company and
Capital Research and Management Company, the following voting and investment
powers with respect to such shares: (a) sole voting power, 737,700 shares; (b)
shared voting power, none; (c) sole investment power, 1,913,200 shares; and (d)
shared investment power, none.
(6) According to information provided to the Company, Nicholas Applegate
Capital Management had the following voting and investment powers with respect
to such shares: (a) sole voting power, 450,899 shares; (b) shared voting power,
none; (c) sole investment power, 1,451,053 shares; and (d) shared investment
power, none.
(7) According to information provided to the Company, Norwest Corporation,
Inc., had, through certain of its subsidiaries, the following voting and
investment powers with respect to such shares: (a) sole voting power, 2,630,300
shares; (b) shared voting power, 15,300 shares; (c) sole investment power,
2,793,300 shares; and (d) shared investment power, 500 shares. Norwest
Corporation disclaims beneficial ownership of all shares for the purposes of
Sections 13, 14, or 16 of the Securities Exchange Act of 1934.
(8) According to information provided to the Company, Pioneer Management
Corporation had the following voting and investment powers with respect to such
shares: (a) sole voting power, 1,775,000 shares; (b) shared voting power, none;
(c) sole investment power, 245,000 shares; and (d) shared investment power,
1,530,000 shares.
(9) This total avoids duplication due to the attribution of beneficial
ownership of 1,453,000 shares to both Mr. Powell, Jr. and Mr. Powell III
referred to in note (3) above. Executive officers' and directors' share
ownership includes: 12,131 shares held in employee stock plans; 5,790 shares
which officers had the right to acquire within 60 days of such date through the
exercise of stock options pursuant to the Company's 1983 Stock Option Incentive
Plan; 2,302,502 shares attributed to George E. Powell, Jr., to which notes (1)
and (3), above, apply; 1,753,748 shares attributed to George E. Powell III, to
which notes (2) and (3), above, apply; 200 shares owned by relatives of other
executive officers or directors as to which such executive officers or directors
disclaim beneficial ownership; and 1,453,000 shares owned by a charitable
foundation which duplicate shares referred to in notes (1), (2) and (3), above,
and with respect to which beneficial ownership is disclaimed.
I. ELECTION OF DIRECTORS
At the meeting, three Class III directors are to be elected to three-year
terms which shall expire at the 1998 Annual Meeting of Stockholders of the
Company. All nominees have consented to being named and to
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<PAGE> 6
serve the full three-year term if elected. If any nominee should be unable to
stand for election as a director, an event not anticipated, it is intended that
the shares represented by proxies will be voted for the election of such
substitute as management may nominate.
The following tables set forth information with respect to each director
and each nominee for election as a director of the Company. George E. Powell III
is the son of George E. Powell, Jr. No other director or nominee has any family
relationship with any other director or executive officer of the Company.
<TABLE>
<CAPTION>
SHARES OF STOCK OWNED
BENEFICIALLY (1)(2),
NAME; PAST SERVICE PRINCIPAL OCCUPATION; DIRECTLY OR INDIRECTLY,
TERM OF OFFICE DIRECTORSHIPS; AGE AS OF DECEMBER 31, 1994
--------------------------- ---------------------------------------------- -----------------------
<S> <C> <C>
NOMINEES FOR ELECTION AS CLASS III DIRECTORS
M. Reid Armstrong.......... President of Yellow Freight System, Inc. 5,473
Director since 1992 ("Yellow"), the Company's principal operating
subsidiary (since May 1992); Executive Vice
President of the Company and of Yellow
(December 1991-May 1992); Senior Vice
President (prior to December 1991); 57
David H. Hughes............ Formerly Director (Vice Chairman 1986-1990), 4,500
Director since 1973 President and Chief Operating Officer of
Hallmark Cards, Inc., Kansas City, MO
(greeting cards); Director of Western
Resources, Inc.; 66
George E. Powell, Jr....... Chairman of the Board (formerly also Chief 2,302,502
Director since 1952 Executive Officer) of the Company; Director of
Butler Manufacturing Co., Inc.; 68
DIRECTORS CONTINUING IN OFFICE
Klaus E. Agthe............. Director and North American Liaison for the 1,000
Director since 1984 VIAG Group, Munich, Germany (an international
Term expires 1996 holding company) (Since January 1993);
formerly chief officer in charge of operations
in eastern Germany for Asea Brown Boveri A.G.,
Berlin Germany, (January 1991-December 1992);
Executive Vice President of Asea Brown Boveri
Inc., Stamford, CT (January 1990-December
1991); and President and Chief Executive
Officer of Asea Brown Boveri Inc., Purchase,
NY (January 1988-January 1990); 64
Howard M. Dean............. Chairman and Chief Executive Officer (formerly 500
Director since 1987 President and Chief Executive Officer) of Dean
Term expires 1996 Foods Company, Franklin Park, IL (processor
and distributor of food products); Director of
Nalco Chemical Company and Ball Corporation;
57
George E. Powell III....... Chief Executive Officer of the Company (since 1,753,748
Director since 1984 July 1990); President of the Company (since
Term expires 1996 October 1987); formerly President of Yellow
(October 1987-May 1992); 46
Ronald T. LeMay............ Director, President, and Chief Operating 0
Director since 1994 Officer, Long Distance Division, Sprint
Term expires 1997 Corporation, Kansas City, MO
(telecommunications) (since October 1989);
formerly Executive Vice President, Corporate
Affairs of United Telecommunications, Inc. and
Executive Vice President, Staff of U.S. Sprint
Corporation; 49
</TABLE>
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<PAGE> 7
<TABLE>
<CAPTION>
SHARES OF STOCK OWNED
BENEFICIALLY (1)(2),
NAME; PAST SERVICE PRINCIPAL OCCUPATION; DIRECTLY OR INDIRECTLY,
TERM OF OFFICE DIRECTORSHIPS; AGE AS OF DECEMBER 31, 1994
--------------------------- ---------------------------------------------- -----------------------
<S> <C> <C>
John C. McKelvey........... President and Chief Executive Officer of 390
Director since 1977 Midwest Research Institute, Kansas City, MO
Term expires 1997 (scientific and technical research); 61
William L. Trubeck......... Senior Vice President -- Finance and Chief 200
Director since 1994 Financial Officer of SPX Corporation,
Term expires 1997 Muskegon, MI (equipment manufacturer for motor
vehicle industry) (since November 1994);
formerly Senior Vice President and Chief
Financial Officer of Honeywell, Inc.,
Minneapolis, MN (April 1993-October 1994);
Chief Financial Officer, White & Case, New
York, NY (1991-1993); Executive Vice
President, Finance & Chief Financial Officer,
NWA, Inc., St. Paul, MN (1989-1990); Director
of Bush Bros. and Great Lakes Aviation; 48
</TABLE>
(1) These figures include shares beneficially owned by certain members of
the families of the following directors or nominees for director, as to which
shares the director or nominee disclaims beneficial ownership: Mr. Powell, Jr.,
33,800 shares; Mr. McKelvey, 200 shares; and Mr. Powell III, 40,474 shares. Also
included are 155,600 shares owned by a charitable foundation with respect to
which Mr. Powell, Jr. shares voting and investment powers, and 61,028 shares
owned by a trust with respect to which Mr. Powell, Jr. has sole voting and
investment powers. Mr. Powell, Jr. has no other beneficial interest with respect
to such shares and disclaims beneficial ownership thereof. Included in the
totals for both Mr. Powell, Jr. and Mr. Powell III are 1,453,000 shares owned by
a private charitable foundation with respect to which each shares voting and
investment powers with others and as to which each disclaims beneficial
ownership.
(2) The percentage of the Company's outstanding stock owned by each
director and nominee for director is less than one percent, except for Mr.
Powell, Jr. and Mr. Powell III, whose respective percentages of beneficial
ownership are reflected in the section titled "Principal Stockholders," above.
STRUCTURE AND FUNCTIONING OF THE BOARD OF DIRECTORS
The Board of Directors held five regularly scheduled meetings during 1994.
Audit Committee. The Audit Committee consisted of Thomas M. Bloch, Charles
A. Duboc, and John C. McKelvey for the April meeting. Messrs. Bloch and Duboc
retired from the Board during 1994. The Audit Committee consisted of John C.
McKelvey, David H. Hughes and William L. Trubeck for the October and December
meetings. The Committee's functions include consulting with the Company's
independent public accountants concerning the scope and results of the audit,
reviewing the evaluation of internal accounting controls and inquiring into
special accounting-related matters.
Compensation Committee. The Compensation Committee consisted of Klaus E.
Agthe, Howard M. Dean and David H. Hughes for the April meeting, with Ronald T.
LeMay replacing Mr. Hughes for the October and December meetings. The
Committee's functions include making recommendations to the Board of Directors
regarding compensation of officers and approving compensation strategies for
executive officers; reviewing actions relating to officer compensation; and
setting policy for the Company's pension and profit sharing plans.
Nominating Committee. The Nominating Committee consisted of Howard M.
Dean, John C. McKelvey & George E. Powell, Jr. It met once during the last
fiscal year. The Committee's functions include considering nominees for the
Board of Directors and submitting to the whole Board for its consideration
nominees approved by the Committee.
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<PAGE> 8
DIRECTORS' COMPENSATION
Directors who are not full-time employees of the Company or any of its
subsidiaries are paid an annual retainer for Board service of $23,000; an annual
retainer for committee service of $1,200 for each committee on which a director
serves (excepting directors on the Nominating Committee, who receive a committee
attendance fee but not a separate committee retainer); an attendance fee of
$1,300 for each Board meeting and $1,100 for each committee meeting attended;
and are reimbursed or made whole for all costs and expenses of any kind incurred
by them related to Board or committee meetings. Directors may elect to defer
receipt of the retainer and attendance fees. Directors who are full-time
employees of the Company or any of its subsidiaries are not paid any retainer or
attendance fees for service as members of the Board or any committee thereof.
Mr. Powell, Jr. receives the annual retainer and meeting fees paid to other
non-employee directors and receives an additional retainer from the Company with
the result that his total annual payments from the Company equal $160,000.
During the last fiscal year, no incumbent director attended fewer than 75
percent of the aggregate of the total number of meetings of the Board held
during the period he was a director and of committees of the Board on which he
served during the period that he was a director.
EXECUTIVE COMPENSATION
There is shown below information concerning the annual and long-term
compensation for services in all capacities to the Company or certain of its
subsidiaries for the fiscal years ended December 31, 1994, 1993 and 1992 of
those persons who were, at December 31, 1994, (i) the President and Chief
Executive Officer of the Company and (ii) the other four most highly compensated
executive officers of the Company or certain of its subsidiaries:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-------------------------------------
AWARDS PAYOUTS
ANNUAL COMPENSATION ------------------------- -------
--------------------------------------------
(E) (F) (G) (H) (I)
(A) (D) (2)OTHER RESTRICTED OPTIONS/ LTIP (4)ALL
NAME AND PRINCIPAL (B) (C) BONUS ANNUAL STOCK SARS PAYOUTS OTHER
POSITION YEAR SALARY ($) ($)(1) COMP.($) AWARD(S) ($) (#) ($) COMP.($)
----------------------------- ----- ---------- ------- -------- ------------ -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
George E. Powell III 1994 387,333 32,776 0 0(3) 0 0 0
President, Chief Executive 1993 360,000 0 0 0 0 0 9,062
Officer, Yellow Corporation 1992 354,656 101,500 0 104,127 0 0 9,440
M. Reid Armstrong 1994 314,750 28,889 0 0(3) 0 0 0
President, Yellow 1993 290,000 0 0 0 0 0 8,264
Freight System, Inc. 1992 259,038 66,500 0 65,148 0 0 5,358
Robert W. Burdick 1994 236,062 25,503 0 0(3) 0 0 0
Senior Vice President- 1993 226,400 0 0 0 0 0 8,005
Corporate Development/ 1992 224,175 41,000 0 51,765 0 0 5,085
Public Affairs, Yellow
Corporation
Leo H. Suggs 1994 252,850 0 0 0 0 0 2,250(5)
President, Preston 1993 240,726 0 0 0 0 0 6,983
Corporation 1992 165,000 52,000 0 0 0 0 3,302
Robert L. Bostick 1994 201,703 34,548 0 0 0 0 0
Senior Vice President 1993 190,800 0 0 0 0 0 6,983
Operations, Yellow 1992 160,788 50,000 0 0 0 0 3,315
Freight System, Inc.
</TABLE>
(1) No executive officer bonuses were paid for 1994. The amounts paid in
1994 represent the payment of deferred bonuses for 1993, as described in the
Compensation Committee Report on Executive Compensation.
(2) While the named executive officers receive certain perquisites from the
Company or the involved subsidiary, such perquisites do not reach the threshold
for reporting of $50,000 or ten percent of salary and bonus set forth in the
applicable rule of the Securities and Exchange Commission.
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<PAGE> 9
(3) On October 22, 1992, restricted stock awards totaling 8,886 shares were
granted to the named executive officers as follows: Mr. Powell III, 4,186
shares; Mr. Armstrong, 2,619 shares; and Mr. Burdick, 2,081 shares. Under the
award, the restrictions have lapsed over a two-year period with the restrictions
having lapsed on 50% of the awarded shares in 1993 and 50% in 1994. The market
value of a share of the Company's stock on the date of the awards was $24.875.
(4) The compensation reported for 1993 and 1992 represents (a) shares
allocated to the accounts of the named executive officers under the Company's
Stock Sharing Plan and (b) with respect to Mr. Powell III, Mr. Armstrong and Mr.
Burdick, the cash replacement of the stock sharing contributions to which Mr.
Powell III, Mr. Armstrong and Mr. Burdick would have been entitled before
application of legislative limitations. During 1994, there were no shares
allocated under the Stock Sharing Plan.
(5) The compensation reported for Mr. Suggs for 1994 represents Preston
Corporation's matching contribution under Preston Corporation's 401(k) Plan.
During 1994, Mr. Suggs contributed $9,000 to the Preston Corporation 401(k) Plan
and such amount is included in the amount shown under salary.
OPTIONS AND STOCK APPRECIATION RIGHTS
The following table summarizes the value of the options and SARs held by
the executive officers named in the Summary Compensation Table above. None of
these officers exercised options or SARs in 1994. No options or SARs were
granted during 1994.
OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR, AND FY-END OPTION/SAR
VALUE(1)
<TABLE>
<CAPTION>
VALUE OF VALUE OF
NUMBER OF NUMBER OF UNEXERCISED UNEXERCISED
UNEXERCISED UNEXERCISED IN-THE-MONEY IN-THE-MONEY
OPTIONS AT SARS AT OPTIONS AT SARS AT
FY-END (#) FY-END (#) FY-END ($) FY-END (#)
SHARES ACQUIRED VALUE EXERCISABLE/ EXERCISABLE/ EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE UNEXERCISABLE UNEXERCISABLE
----------------------------- --------------- ------------ ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
George E. Powell III -- -- 0/0 0/0 0/0 0/0
M. Reid Armstrong -- -- 0/0 0/0 0/0 0/0
Robert W. Burdick -- -- 0/0 0/0 0/0 0/0
Leo H. Suggs -- -- 0/0 0/0 0/0 0/0
Robert L. Bostick -- -- 0/0 920/0 0/0 0/0
</TABLE>
(1) The value of the Company's common stock on 12/31/94 was $23.875
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The compensation program for the Company's executive officers is
established to allow the organization to attract and retain the caliber of
executive whose leadership skills will enable the Company and its subsidiaries
to effectively compete in their market segments. Additionally, the programs are
intended to act as an incentive for the executive to attain the highest level of
organizational performance and profitability by rewarding the executive for
increasing levels of profit and stockholder value.
In conformance with the above compensation philosophy, the total annual
compensation for all executive officers of the Company is determined by one base
element -- salary -- and an annual incentive bonus. In addition, for those
executive officers at the level of senior vice president or above at the Company
or the involved subsidiary, total annual compensation includes potential awards
under the Company's 1992 Stock Option Plan.
Salary for the Company's executive officers is determined by analysis of
three factors, consisting of (1) salary levels at service industries with gross
revenues comparable to the Company; (2) evaluation of the individual executive
officer's performance; and (3) the Company's ability to pay. While the three
factors are not formally weighted, the Company's ability to pay is a threshold
consideration. Individual executive
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<PAGE> 10
performance is not measured by specific performance targets or goals but is
rather an overall, general evaluation process. While the Company has targeted
the median of the range established by the competitive survey group of service
companies for the salary compensation of executive officers, actual 1994
salaries for executive officers are generally below the median.
Annual bonuses are based on a performance formula derived from competitive
survey data of service companies with gross revenues comparable to the Company's
developed by Towers Perrin, a nationally recognized executive compensation
consulting firm. This performance formula provides for increasing levels of
payment, once a minimum operating profit threshold is attained, and the measure
of operating profits utilized in this performance formula is pre-tax operating
ratio. Therefore, annual bonus is not based on performance targets but only on
actual Company results. No bonuses were awarded to the Company's executive
officers for 1994 since the minimum operating profit threshold, while attained
for individual quarters, was not attained for the entire year.
The Compensation Committee has the authority to waive or readjust the
performance formula that has been utilized for determining executive officers'
annual bonuses and did so for the first time in 1993. In December 1993, the
Committee recommended, and the Company's Board approved, a waiver of the
operating profit threshold for 1993, based upon the anticipated short-term
negative impact that year of completion of the Preston Corporation acquisition.
The size of the 1993 awards was determined by application of the performance
formula after elimination of the operating profit threshold, further reduced by
a factor equal to the degree to which salary and wage increases for all the
Company's employees in 1993 compared unfavorably with 1992. The 1993 awards were
also deferred until 1994 and made contingent upon the Company or the involved
subsidiary meeting or exceeding the minimum operating profit threshold for any
quarter in 1994, after application of the established performance formula. The
contingency set forth in 1993 for deferred annual bonus payments to the
Company's executive officers was satisfied in the third quarter of 1994 with
respect to executive officers employed by the Company and its Yellow subsidiary,
and accordingly the deferred 1993 annual incentive bonuses were paid to these
executive officers in the fourth quarter of 1994.
Awards under the Company's 1992 Stock Option Plan utilize the same
performance formula relating to pre-tax operating ratio that forms the basis for
annual bonus awards, the only difference being that the 1992 Stock Option Plan
awards are based on a three-year average of the Company's annual operating
profits. Since the performance formula is based entirely on actual Company
operating results, the Compensation Committee in its deliberations does not
consider the amount of options or restricted stock awards already outstanding or
previously granted, or the aggregate size of current awards. Though the 1992
Plan contemplates three types of awards -- Stock Options, Share Appreciation
Rights and Restricted Stock -- it has been the Compensation Committee's past
practice to award Restricted Stock. It is the Committee's belief that executive
officers, most particularly the CEO of the Company and the presidents of certain
of its subsidiaries, should have a stake in the Company's ongoing success
through stock ownership. It has thus been the Committee's practice to restrict
awards to executive officers at the level of senior vice president or above at
the Company or the involved subsidiary. This ownership position is intended to
focus these executives' attention on managing the business in the best interest
of the stockholders. No awards under the Company's 1992 Stock Option Plan were
made in 1994 since the minimum operating profit threshold was not attained for
the entire year.
The Compensation Committee has the same authority to waive or readjust the
performance formula that has been utilized for determining awards under the 1992
Stock Option Plan that it has with respect to awards of annual bonuses. No
waiver or readjustment of the performance formula has occurred with respect to
awards under the 1992 Stock Option Plan since its inception in 1992.
CEO COMPENSATION
The base salary of George E. Powell III is set at a level commensurate with
competitive salaries for CEO positions of service industry companies with gross
revenues comparable to the Company, using survey data developed by Towers
Perrin, a nationally recognized executive compensation consulting firm. While
Mr. Powell's base annual salary was increased by $40,000 in 1994 in order to
bring his base salary more in line with the involved survey group, his base
salary remains below the range midpoint of this group.
-8-
<PAGE> 11
No annual bonus or award under the 1992 Stock Option Plan was granted Mr.
Powell in 1994 for the same reasons documented above in the Compensation
Committee's general discussion of executive officer compensation. Mr. Powell
received a deferred 1993 annual bonus in the fourth quarter of 1994, again under
the same criteria set forth in the Compensation Committee's above discussion of
executive officer compensation. No award under the 1992 Stock Option Plan was
granted Mr. Powell in 1993.
The annual bonus and restricted stock awards granted Mr. Powell in 1992
were based on the performance formula derived from competitive survey data of
service companies with gross revenues comparable to the Company's developed by
Towers Perrin that is described in the Compensation Committee's above discussion
of executive officer compensation.
Howard M. Dean, Chairman
Klaus E. Agthe
Ronald T. LeMay
Members of the Compensation Committee
COMMON STOCK PERFORMANCE
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total stockholder return of the Company's common stock against
the cumulative total return of the S&P Composite-500 Stock Index and the S&P
Transportation Composite Index for the period of five years commencing December
31, 1989 and ending December 31, 1994.
TOTAL RETURN TO SHAREHOLDERS
YELLOW CORPORATION: 1990-1994
<TABLE>
<CAPTION>
MEASUREMENT PERIOD YELLOW COR- S&P 500 IN- S&P TRANS-
(FISCAL YEAR COVERED) PORATION DEX PORTATION
<S> <C> <C> <C>
DEC 89 100 100 100
96.98 96.99 100.73
105.19 103.09 100.20
77.32 88.92 78.20
DEC 90 102.33 96.89 86.36
121.60 110.97 98.34
118.63 110.72 105.20
118.55 116.64 112.74
DEC 91 106.00 126.42 128.50
115.82 123.22 129.53
110.15 125.57 128.52
100.41 129.53 124.08
DEC 92 112.60 135.05 139.63
99.08 141.99 146.43
80.70 142.68 146.86
103.37 146.37 155.81
DEC 93 106.56 149.76 166.20
103.11 144.08 155.68
75.88 144.69 151.94
82.35 151.76 142.51
DEC 94 106.84 151.74 139.34
</TABLE>
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<PAGE> 12
1992 STOCK OPTION PLAN
On April 24, 1992, the stockholders approved the adoption of the 1992 Stock
Option Plan (the "1992 Plan"). 800,000 shares of common stock are available for
grant under the 1992 Plan. The 1992 Plan expires on April 25, 2002, in that no
awards may be made after that date.
The Company's 1992 Plan is administered by the Compensation Committee of
the Board of Directors, none of whose members are eligible to receive an award
under the 1992 Plan. The 1992 Plan covers executive, managerial, supervisory and
professional employees of the Company and certain of its subsidiaries (including
employee-directors and officers) and permits three types of awards: Grants of
stock options, which are either Incentive Stock Options ("ISOs") or non-ISOs
("non-qualified options"); grants of stock options coupled with a grant of stock
appreciation rights ("SARs"); and grants of restricted stock awards. The 1992
Plan also provides for share delivery to employees otherwise eligible for an
award under the Plan in lieu of cash incentive awards under any management
incentive plan.
In determining the grant of awards to eligible employees, the Compensation
Committee may consider the nature of the services rendered or that the Committee
expects may be rendered by the employee, the employee's present and potential
contributions to the success of the business, the number of years of effective
service the employee is expected to have and such other factors as the Committee
may deem relevant.
The option exercise price (or initial value in the case of an SAR) is 100%
of the fair market value of the stock on the date of the grant, and may be paid
in cash or by delivery of shares owned by the optionee. Options and SARs coupled
with options become exercisable on the first anniversary of the date of the
grant. Restrictions on the sale or transfer of restricted stock awarded under
the 1992 Plan will be lifted on a specified percentage of the total award each
year, beginning one year after the date of grant. The time at which SARs and
certain options become exercisable or restrictions lapse on restricted stock
award shares is accelerated upon the occurrence of certain events, such as total
and permanent disability or death of an employee while in the employ of the
Company or a subsidiary, if the Company is wholly or partly liquidated, or is a
party to a merger, consolidation or reorganization in which it or an entity
controlled by it is not the surviving entity, or upon the occurrence of certain
events which may lead to a change of control of the Company. If not previously
exercised, options or rights granted under the 1992 Plan expire either ten years
or five years after the grant date. No options or SARs have yet been awarded
under the 1992 Plan. Any options or SARs presently held by the executive
officers named in the Summary Compensation Table were granted under the
substantially similar predecessor 1983 Stock Option Incentive Plan ("the 1983
Plan"). No executive officer exercised options or SARs under the 1983 Plan in
1994.
Awards of restricted stock to the named executive officers under the 1992
Plan are detailed in Footnote (3) to the Summary Compensation Table. No
executive officers were granted restricted stock awards in 1994.
DEFINED CONTRIBUTION PLANS
The Company and certain of its subsidiaries' executive officers participate
in two defined contribution plans -- the Yellow Freight Profit-Sharing Trust and
the Yellow Freight Stock Sharing Plan. The plans cover all the regular full-time
and regular part-time office, clerical, sales, supervisory and executive
personnel of the Company and participating subsidiaries (excluding directors who
are not salaried employees) employed in the United States and not covered by a
collective bargaining agreement. A total of 5,038 employees were participants in
1994.
Each year the Board of Directors determines the amount of the contributions
to the trusts under the plans (see below) based primarily upon the Company's
profitability. No contribution to the Profit Sharing Trust was awarded by the
Board of Directors in 1994. A contribution equal to the principal and interest
payments due, less dividend income, was made in 1994 to the Stock Sharing Trust
equaling $9,877,668.
The Employee Retirement Income Security Act of 1974 ("ERISA"), as amended
by subsequent legislation, may prevent the contribution to or allocation under
the defined contribution plans of the amount to
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<PAGE> 13
which a participant would otherwise be entitled. The Company has a policy of
replacing contributions to which a participant would have been entitled before
application of the legislative limitations by means of an annual cash payment to
affected participants. The policy allows a participant to defer any annual cash
payment through a non-qualified, unfunded, deferred compensation arrangement,
though no executive officer receiving such payment has elected deferral. Amounts
paid to the named executive officers in 1992 and 1993 under the Company's policy
of cash replacement of Stock Sharing contributions subject to legislative
limitations are set forth in Footnote (4) to the Summary Compensation Table. No
other executive officer qualified for such cash payments.
Profit-Sharing Trust. Two accounts are maintained for each participant and
each account is credited with 50% of the participant's share of the year's
contribution. Account B is 100% vested and consists of that participant's share
of the contribution, increments from income from investments and the net change
in the value of securities. Account A vests at the rate of 20% per year for each
year of participation. It consists of the same elements as Account B plus an
allocation of forfeitures. Vested benefits are paid upon termination of
employment, but an active participant may withdraw a portion of his accounts,
subject to certain limitations.
The Profit-Sharing Trust also contains provisions for a cash or deferred
arrangement under Section 401(k) of the Internal Revenue Code. This arrangement,
called SPARE, allows a participant to deposit in the program up to 12% of his
annual earnings before, or after, federal income taxes. For 1994, the maximum
annual participant contribution was $9,240. There is no Company matching
contribution.
A participant may choose among three investment alternatives for his
deposits and is 100% vested in his SPARE account. Accounts become payable upon
cessation of employment, retirement at or after age 65 and in the event of total
and permanent disability or death. An active participant may withdraw a portion
of his before-tax deposits, subject to certain limitations. After-tax deposits
may be withdrawn for any reason. Deposits may be withdrawn not more than once
every two years.
The amounts which the named executive officers chose to have deposited in
the Section 401(k) portion of the trust, subject to the 12% limitation, are
included in the salary column of the Summary Compensation Table. There was no
contribution to the Profit-Sharing Trust for 1994.
Stock Sharing Plan. The Stock Sharing Plan invests solely in Company
common stock, except for the diversification options described below. The plan
trustee may borrow funds to finance purchases of Company stock (a "purchase
loan"). Each year, the Company may make a contribution to the Stock Sharing Plan
from Company earnings. The amount of Company contributions can vary from year to
year, according to Company profits. This contribution (and any dividends on the
shares of stock in the Stock Sharing Plan purchased with an outstanding loan)
may be used to repay any purchase loan. As the loan is repaid, stock will be
allocated to each participant's account. If there is no loan outstanding, or if
a contribution in excess of the amount needed to service the debt on any
outstanding loan is made, stock purchased by the contribution will be allocated
directly to each participant's account. Participants vote allocated shares; the
plan trustee votes unallocated shares in the same proportion as the allocated
shares are voted.
The number of shares allocated to a participant in any year is based on a
formula that compares the participant's earnings with those of all other
eligible employees. The shares allocated to the accounts of the named executive
officers in 1992 and 1993 are detailed in Footnote (4) to the Summary
Compensation Table. No shares were allocated under the Plan in 1994.
A participant's account vests at the rate of 20% per year for each year of
participation in the Plan, but years of service under the Yellow Freight
Profit-Sharing Trust count toward vesting in the Stock Sharing Plan. In
addition, an account becomes 100% vested when a participant reaches age 65, dies
or becomes permanently disabled. After reaching age 55 a participant may
transfer up to 25% of his account's value into one or more of three investment
funds; after reaching age 60 a participant may transfer up to 50% of his account
to such funds.
Accounts become payable upon cessation of employment, retirement at or
after age 65 and in the event of total and permanent disability or death.
Participants have various options as to the time and method of payment.
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<PAGE> 14
DEFINED BENEFIT PENSION PLAN
The Company and certain of its subsidiaries' officers participate in a
noncontributory, defined benefit pension plan. Such plan covers all regular
full-time and regular part-time office, clerical, sales, supervisory and
executive personnel of the Company and participating subsidiaries (excluding
directors who are not salaried employees) who are at least age 21, are employed
in the United States and are not otherwise covered by a pension plan under a
collective bargaining agreement. Pension plan benefits are calculated solely on
salaries and cash bonuses. Compensation reported in the Summary Compensation
Table includes amounts which are not covered compensation under the pension
plan. Participants are vested after five years of service.
A participant retiring at age 65 will receive an annual pension benefit
(single life basis) amounting to 1 2/3% of his final average annual compensation
paid in the five highest consecutive years of the participant's last ten
consecutive years of participation, multiplied by his total years of
participation, the sum of which is reduced by 50% of the amount of his primary
Social Security entitlement at retirement (prorated if participation is less
than 30 years). The pension of the highest-paid executive officers will probably
be reduced from the above formula because of ERISA limitations.
The following table sets forth the gross annual benefits (single life at
age 65), before deduction of the applicable primary Social Security offset
amount (a maximum of 50% of the participant's primary Social Security benefits
at 30 years of participation), payable upon retirement under the defined benefit
pension plan for specified remuneration and years of service classifications,
part of which may be paid pursuant to the supplemental retirement income
agreements discussed below:
PENSION VALUE TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
------------------------------------------------
ELIGIBLE REMUNERATION(1) 15 20 25 30 35
------------------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
125,000 31,250 41,650 52,100 62,500 73,000
150,000 37,500 50,000 62,500 75,000 87,500
175,000 43,750 58,350 73,000 87,500 102,100
200,000 50,000 66,650 83,350 100,000 116,650
225,000 56,250 75,000 93,750 112,500 131,250
250,000 62,500 83,350 104,150 125,000 145,850
300,000 75,000 100,000 125,000 150,000 175,000
350,000 87,500 116,650 145,850 175,000 204,150
400,000 100,000 133,350 166,650 200,000 233,350
450,000 112,500 150,000 187,500 225,000 262,500
500,000 125,000 166,650 208,350 250,000 291,650
550,000 137,500 183,350 229,150 275,000 320,850
600,000 150,000 200,000 250,000 300,000 350,000
650,000 162,500 216,650 270,850 325,000 379,150
</TABLE>
(1) Eligible Remuneration as used in this table is defined as
final average covered compensation (salary and annual bonus) for the
five highest consecutive years of the participant's last ten
consecutive years of participation preceding termination of employment
under the plan.
ERISA, as amended by subsequent legislation, limits covered compensation
under the pension plan to $150,000 in 1994 and imposes maximum annual benefit
limitations, which may cause a reduction in the pension payable under the
pension plan. The Company has entered into nonqualified, unfunded supplemental
retirement income agreements with affected participants which are designed to
provide those benefits intended by the pension plan before application of the
legislative limitations.
The named executive officers have credited years of service in the plan as
follows: Mr. Powell III, 21 years; Mr. Armstrong, 21 years; Mr. Burdick, 13
years; Mr. Suggs, 6 years; and Mr. Bostick, 29 years.
-12-
<PAGE> 15
RELOCATION POLICY
The Company and certain of its subsidiaries' officers, as well as other
salaried employees, are covered by the Company's relocation policy. The policy
reimburses employees for certain moving expenses when the employee is
transferred to a new location and is required by the Company or its subsidiary
to move his residence. Items covered by the policy include the expense of a trip
to the new location to select a new home, car mileage expenses, certain expenses
associated with terminating any lease at the old location, temporary living
expenses at the new location, travel expenses for trips home during the
transition period, cost of transporting certain household goods and
reimbursement for en route travel expenses or airfare for transporting the
employee's family to the new location. In addition, except for certain
newly-hired employees moving to their initial assignment, transferred employees
are paid a predetermined lump sum to cover miscellaneous moving costs and
expenses.
The policy pays closing costs on a home purchased by a transferred
executive officer or other key employee. The policy also gives such an employee
the option of either (1) selling his home at the old location for its estimated
value to an employee relocation assistance firm or (2) selling his home himself
or through a real estate agent. If the first option is chosen and the home sells
for less than the amount paid to the employee, the relocation assistance firm is
reimbursed by the Company for the difference between what it pays the employee
and the selling price, plus its expenses, costs and fees. If the second option
is chosen, the employee is reimbursed for normal selling expenses and receives a
cash incentive for selling the home to a third party rather than selling it to a
relocation assistance firm.
In 1993, Preston Corporation made to Leo H. Suggs, President of that
subsidiary, a $480,000 interest-free relocation loan effective May 3, 1993.
OTHER INFORMATION
The Company has entered into Executive Severance Agreements (the
"Agreements") with all the executive officers named in the Summary Compensation
Table, as designated by the Board of Directors.
In the event of a "Change in Control" of the Company followed within two
years by (1) the termination of the executive's employment for any reason other
than death, disability, retirement or "cause" or (2) the resignation of the
executive due to an adverse change in title, authority or duties, a transfer to
a new location, a reduction in salary, or a reduction in fringe benefits or
annual bonus below a level consistent with the Company's practice prior to the
Change of Control, the Agreements provide that the executive shall be paid a
lump sum cash amount equal to the sum of (a) two times the executive's highest
compensation (salary plus bonus) for any consecutive 12-month period within the
previous three years and (b) a cash amount equal to the unvested portion (if
any) of any profit sharing account of the executive under any profit sharing
plan of the Company or its subsidiaries. If the executive is within 10 years of
his normal retirement age (65), then the executive would be paid three times
such highest compensation. A termination is for "cause" if it is the result of a
conviction of a felony by a court of competent jurisdiction, which is no longer
subject to direct appeal, or an adjudication by a court of competent
jurisdiction, which is no longer subject to direct appeal, that the executive is
mentally incompetent or that he is liable for negligence or misconduct in the
performance of his duty to the Company.
"Change of Control" for the purpose of the Agreements shall be deemed to
have taken place if: (i) A third person, including a "group" as defined in
Section 13(D)(3) of the Securities Exchange Act of 1934, purchases or otherwise
acquires shares of the Company and as a result thereof becomes the beneficial
owner of shares of the Company having 20% or more of the total number of votes
that may be cast for the election of directors of the Company; or (ii) as the
result of, or in connection with any cash tender or exchange offer, merger or
other business combination, or contested election, or any combination of the
foregoing transactions, the continuing directors shall cease to constitute a
majority of the Board of Directors of the Company or any successor to the
Company.
In addition, as described previously (see discussion of the "1992 Stock
Option Plan"), the Compensation Committee has provided a "Limited Right" in
connection with certain stock options held by the executive
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<PAGE> 16
officer who is a party to an Agreement. In the event of the purchase of Company
stock pursuant to a tender or exchange offer by a party other than the Company
for 20% or more of the Company's then outstanding shares, the "Limited Right"
allows the executive to receive from the Company, upon surrender of outstanding
options, an amount in cash equal to the then fair market value of the shares for
which the "Limited Right" is exercised, less the exercise price and applicable
withholding taxes. The "Limited Right" may be exercised within 30 days after the
first purchase of Company stock pursuant to the tender or exchange offer.
II. PROPOSAL TO APPROVE APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen & Co. as independent
public accountants of the Company for 1995. The appointment of independent
public accountants by the Board of Directors is submitted annually for approval
by the stockholders. Although stockholder approval is not required, if the
stockholders do not ratify the appointment, the Board of Directors will
reconsider the matter. A representative of Arthur Andersen & Co. will be present
at the Annual Meeting of Stockholders to respond to appropriate questions, and
he will have an opportunity to make a statement if he desires to do so.
III. STOCKHOLDER PROPOSAL
A stockholder has stated his intention to present the following proposal at
the 1995 Annual Meeting. The proposal and supporting statement, for which the
Board of Directors and Company accept no responsibility, are set forth below.
The Board of Directors opposes this proposal for the reasons stated after the
text of the proposal and its supporting statement.
STOCKHOLDER PROPOSAL
Mr. Alex Adams of 14968 Carol Drive, Cleveland, Ohio, the owner of more
than $1,000 worth of Company stock, has submitted the following resolution for
vote by the stockholders:
RESOLUTION
RESOLVED: That the stockholders of Yellow recommend that the Board of
Directors take the necessary steps to adopt and implement a policy of
confidential voting at all meetings of its shareholders, and that this
includes the following provisions:
1. That the voting of all proxies, consents and authorizations be
secret, and that no such document shall be available for examination
nor shall the vote or identity of any shareholder be disclosed except
to the extent necessary to meet the legal requirements, if any, of the
Company's state of incorporation; and
2. That the receipt, certification and tabulation of such votes
shall be performed by independent election inspectors.
SUPPORTING STATEMENT
Mr. Adams states that voting fairly reflects a voter's conviction when the
process remains confidential from all those affected by the results. For
employee-shareholders, confidential voting is especially important.
Last year, a majority of voting shareholders supported confidential voting
proposals at American Cyanamid, Occidental Petroleum and Placer Dome. In the
Spring of 1994, IRRC found that confidential voting attracted an average of
43.1% support, up 1.5% from the previous year's average.
Many companies adopt confidential voting policies voluntarily, including
Anheuser-Busch, which granted a request by a Teamster employee shareholder.
A simple majority of the outstanding shares is required to approve this
proposal.
For these reasons, Mr. Adams urges stockholders to vote for this
Resolution.
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<PAGE> 17
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THIS
STOCKHOLDER PROPOSAL FOR THE FOLLOWING REASONS:
The Company's Board of Directors opposes the proposal to require
confidential stockholder voting, and the withholding of proxies and related
documents from examination by any representatives of the Company. The Company's
Directors also oppose the second part of this proposal to require the use of
independent inspectors of election. These proposals would only serve to increase
the cost of the Company's voting process without serving any interest of the
stockholders as a whole, and in some instances would in fact be detrimental to
the interest of stockholders.
Stockholders who desire for whatever reason to remain anonymous presently
have that ability to do so. Stockholders can hold their shares in street name
and their nominees, under federal law, may not reveal their owner's name to
anyone. Employee participants in the Company's stock benefit plans own their
stock through a trustee bank, which may also not reveal how employee
participants vote. Moreover, occasions can arise when an issue is of such
importance to the Company that the ability of the Company to urge responses from
abstainers, for example, is appropriate and necessary if the Directors are to
properly serve the interests of all stockholders.
The present system of appointment of inspectors of election similarly
should be retained. By Company practice, the inspectors of election nominated
each year have always consisted of members of the Company's accounting or legal
departments, at least one of whom has been a Company officer. Historically,
these representatives have accomplished their task at no expense to the Company
and with complete reliability. The proponent would substitute for the present
system a costly, complicated process without any justification or demonstration
that the Company's present process has failed to adequately protect the
Company's stockholders.
Stockholders should also ask themselves whether the proponent is motivated
as a stockholder of your company or whether he is acting on behalf of a union
organization which is pursuing an independent agenda. It should be noted that
the stockholder proposal is word-for-word identical with confidential voting
proposals that have previously been sponsored at other transportation companies,
either directly or indirectly, by the Teamsters Union. The proponent is a road
driver for the Company's principal operating subsidiary and a member of the
Teamsters Union.
IV. OTHER MATTERS
The Board of Directors does not intend to bring any other business before
the meeting and it is not aware that anyone else intends to do so. If any other
business comes before the meeting, it is the intention of the persons named in
the enclosed form of proxy to vote as proxies in accordance with their best
judgment.
PLEASE EXERCISE YOUR RIGHT TO VOTE BY PROMPTLY COMPLETING, SIGNING AND
RETURNING THE ENCLOSED PROXY FORM. You may later revoke the proxy, and if you
are able to attend the meeting, you may vote your shares in person.
BY ORDER OF THE BOARD OF DIRECTORS:
Overland Park, Kansas WILLIAM F. MARTIN, JR.
March 10, 1995 Secretary
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<PAGE> 18
[FRONT SIDE]
YELLOW CORPORATION
PROXY
ANNUAL MEETING OF STOCKHOLDERS, APRIL 19, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints GEORGE E. POWELL, JR., DAVID H. HUGHES and
GEORGE E. POWELL III, and each of them, with full power of substitution, Proxies
of the undersigned to vote all shares of Common Stock of Yellow Corporation,
standing in the name of the undersigned or with respect to which the undersigned
is entitled to vote, at the Annual Meeting of Stockholders of Yellow
Corporation, to be held at the Overland Park Marriott, 10800 Metcalf Avenue,
Overland Park, Kansas, on Wednesday, April 19, 1995, at 9:30 a.m., and at any
adjournments thereof.
If more than one of the above named Proxies shall be present in person or
by substitution at such meeting or at any adjournment thereof, the majority of
said Proxies so present and voting, either in person or by substitution, shall
exercise all of the powers hereby given. The undersigned hereby revokes any
proxy heretofore given to vote at such meeting.
(Continued and to be SIGNED and dated on the reverse side.)
--------------------------------------------------------------------------------
[REVERSE SIDE]
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned stockholder. If no direction is made, this proxy will be
voted FOR Proposals 1 and 2 and AGAINST Proposal 3.
<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS: Nominees -- George E. Powell, Jr., David H. Hughes and M. Reid Armstrong
FOR all nominees WITHHOLD (To withhold authority to vote for any individual nominee, write that nominee's name
listed (except as AUTHORITY on the line provided below.)
marked to the to vote for
contrary to the right). all nominees. ------------------------------------------------------------------------------------
/ / / / The Board of Directors recommends a vote FOR all director nominees listed.
</TABLE>
<TABLE>
<S> <C> <C>
2. PROPOSAL TO APPROVE THE APPOINTMENT of 3. PROPOSAL SUBMITTED BY AN INDIVIDUAL 4. OTHER BUSINESS: In their discretion,
Arthur Andersen & Co. as independent public STOCKHOLDER for confidential voting on the Proxies are authorized to vote upon
accountants of the corporation for 1995. matters submitted for stockholder vote such other business as may properly
and the appointment of independent come before the meeting.
The Board of Directors recommends a vote inspectors of election.
FOR Proposal 2.
The Board of Directors recommends a vote
AGAINST Proposal 3.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
/ / / / / / / / / / / /
Please sign exactly as name appears to the
left. 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.
-------------------------------------------------
Signature
-------------------------------------------------
Signature if held jointly
Dated: ------------------------- , 1995
Please Mark, Sign, Date and Return the Proxy
Card Promptly Using the Enclosed Postage-Paid
Envelope.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD
OF DIRECTORS.
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<PAGE> 19
INSTRUCTIONS TO RETIREMENT SAVINGS PLAN TRUSTEE
YELLOW CORPORATION
ANNUAL MEETING OF STOCKHOLDERS, APRIL 19, 1995
The undersigned hereby instructs BOATMEN'S TRUST COMPANY, as Trustee,
to vote all shares of Common Stock of Yellow Corporation, allocated to the
undersigned's account in the Yellow Corporation Retirement Savings Plan and with
respect to which the undersigned is entitled to instruct the Trustee to vote,
at the Annual Meeting of Stockholders of Yellow Corporation, to be held at the
Overland Park Marriott, 10800 Metcalf Avenue, Overland Park, Kansas, on
Wednesday, April 19, 1995 at 9:30 a.m., and any adjournments thereof, as
specified on the reverse side.
(CONTINUED AND TO BE SIGNED AND DATED ON THE REVERSE SIDE.)
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<PAGE> 20
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1. ELECTION OF DIRECTORS: Nominees-- George E. Powell, Jr., David H. Hughes and M. Reid Armstrong.
FOR all nominees WITHHOLD (To withhold authority to vote for any individual nominee, write that nominee's name on
listed (except as AUTHORITY the line provided below.)
marked to the con- to vote for all
trary to the right). nominees _______________________________________________________________________________________
The Board of Directors recommends a vote FOR all director nominees listed.
/ / / /
2. PROPOSAL TO APPROVE THE APPOINTMENT OF 3. PROPOSAL SUBMITTED BY AN INDIVIDUAL STOCKHOLDER 4. OTHER BUSINESS: In their
Arthur Andersen LLP as independent public for confidential voting on matters submitted for discretion, the Trustee is
accountants for 1995. stockholder vote and the appointment of independent authorized to vote upon such
The Board of Directors recommends a vote inspectors of election. other business as may properly
FOR Proposal 2. The Board of Directors recommends a vote AGAINST come before the meeting.
Proposal 3.
FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN
/ / / / / / / / / / / /
Please sign exactly as name appears to the left. When
signing as attorney, executor, administrator, trustee,
or guardian, please give full title as such.
Dated_____________________________________________,1995
_______________________________________________________
Signature
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED POSTAGE-PAID ENVELOPE.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
"PLEASE MARK INSIDE BLUE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES"
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MESSAGE FROM BOATMEN'S TRUST COMPANY
TRUSTEE OF THE
YELLOW CORPORATION RETIREMENT SAVINGS PLAN
MARCH 15, 1995
IMPORTANT - PLEASE READ
As a participant in the Yellow Corporation Retirement Savings Plan that holds the Company stock
as an asset, you have the right to instruct the Trustee how to vote the shares held in that plan.
All votes are important. Please take advantage of your right to vote.
Enclosed are the Company's Annual Report to Shareholders and the Notice of Annual Meeting (to
be held April 19, 1995) and Proxy Statement. Also enclosed is an "Instructions to Trustee" card.
This Instruction card gives Boatmen's Trust Company (the Trustee) voting instructions for shares
of Yellow Corporation stock held in trust by the Yellow Corporation Retirement Savings Plan. You
are entitled to instruct the Trustee to vote in whatever manner you wish. You are not required to
use the enclosed instruction card to direct the Trustee as to the manner in which you desire that
the Trustee vote. Instead, you may furnish other written instructions to the Trustee.
THE TRUSTEE AND COMPANY URGE YOU TO PROMPTLY EXERCISE YOUR RIGHT TO DIRECT THE TRUSTEE ON HOW TO
VOTE THE SHARES HELD BY THE TRUSTEE. PLEASE COMPLETE, SIGN AND RETURN THE INSTRUCTION CARD, USING
THE ENCLOSED POSTAGE PAID ENVELOPE SO THAT YOUR VOTE MAY BE COUNTED.
BOATMEN'S TRUST COMPANY
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