March 31, 1995
Dear Shareholders:
Shareholders to
be held at the Company's Office, 3171 Directors Row in Memphis,
Tennessee on May 5th. I hope that those of you who find it convenient will
attend.
At the meeting we will report to you on the Company's current
operations and outlook, and members of the Board of Directors and management
will be pleased to respond to any questions you may have.
Whether you own few or many shares of stock and whether or not
you plan to attend in person, it is important that your shares be voted on
matters that come before the meeting. I urge you to specify your choices by
marking the enclosed proxy card and returning it promptly.
If you sign and return your proxy card without specifying your
choices, it will be understood that you wish to have your shares voted in
accordance with the Board's recommendations.
I look forward to seeing as many of you as possible at the
meeting.
Sincerely,
Michael S. Starnes
Chairman of the Board
M.S. CARRIERS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Notice is hereby given that the Annual Meeting of Shareholders of
M.S. Carriers, Inc. (the "Company") will be held at the Company's Office,
3171 Directors Row, Memphis, Tennessee, on Friday, May 5, 1995, at 9:00 a.m.,
local time, for the following purposes:
1. To elect directors for the ensuing year;
2. To consider and vote upon the approval of the Company's
Non-Employee Directors Stock Option Plan; and
3. To act upon such other matters as may properly come before the
meeting.
Shareholders of record at the close of business on March 3, 1995,
will be entitled to vote at the meeting or any adjournment thereof.
It is important that your shares be represented at the meeting.
Accordingly, you are urged to sign and return the enclosed proxy card whether
or not you plan to attend the meeting. If you do attend, you may vote by
ballot at the meeting, thereby canceling any proxy vote previously given.
M.J. Barrow
Senior Vice President-Finance
and Secretary-Treasurer
M.S. CARRIERS, INC.
3171 Directors Row
Memphis, Tennessee 38116
PROXY STATEMENT
This proxy statement and the accompanying proxy card are being
mailed on or about March 31, 1995, to the shareholders of the Company in
connection with the solicitation of proxies by the Board of Directors for the
Annual Meeting of Shareholders in Memphis, Tennessee. Proxies are solicited
to give all shareholders of record at the close of business on March 3, 1995,
an opportunity to vote on matters that come before the meeting. This
procedure is necessary because many shareholders will not be able to attend
the meeting. Shares can be voted only if the shareholder is present in person
or is represented by proxy.
When your proxy card is returned properly signed, the shares
represented will be voted in accordance with your directions. You can specify
your choices by marking the appropriate boxes on the enclosed proxy card. If
your proxy card is signed and returned without specifying choices, the shares
will be voted as recommended by the Board of Directors. You may revoke your
proxy at any time before it is voted at the meeting.
Your vote is important. Accordingly, you are urged to sign and
return the accompanying proxy card whether or not you plan to attend the
meeting. If you do attend, you may vote by ballot at the meeting, thereby
canceling any proxy vote previously given.
As a matter of policy, proxies, ballots and voting tabulations
that identify individual shareholders are kept private by the Company. Such
documents are available for examination only by certain representatives
associated with processing proxy cards and tabulating the vote. The vote of
any shareholder is not disclosed except as may be necessary to meet legal
requirements.
As of March 3, 1995, the record date, there were 12,878,000
shares of Common Stock issued and outstanding. Each share of Common Stock is
entitled to one vote on each matter properly brought before the meeting. A
plurality of the shares of Common Stock present in person or represented by
proxy at the meeting is required for the election of Directors. The
affirmative vote of the holders of a majority of the outstanding shares of
Common Stock, present in person or represented by proxy at the meeting, is req
uired for approval of all other items being submitted to the stockholders for
their consideration.
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth certain information as of March 3,
1995, with respect to the benefi-cial ownership of the Company's Common Stock
by each Director of the Company, by each person known to the Company to be
the beneficial owner of more than 5% of its outstanding Common Stock and by
all officers and directors as a group. The figures relating to Wellington
Management Company are based upon information derived from Schedule 13G
(Amendment No. 7) dated January 30, 1995 as filed with the Securities and
Exchange Commission.
<TABLE>
<CAPTION>
Amount and Nature of Percent of
Shareholders Beneficial Ownership (1) Outstanding Stock
<S> <C> <C>
Michael S. Starnes
c/o M.S. Carriers, Inc.
3171 Directors Row
Memphis, Tennessee 38116 3,106,158 24.1%
Wellington Management Company
75 State Street
Boston, Massachusetts 02109 1,610,630(2) 12.5%
Carl J. Mungenast 0 *
James W. Welch 131,953(3)(4) 1.0%
Gary Hardeman 46,859(3)(4) *
M.J. Barrow 39,712(3)(4) *
Robert P. Hurt 33,598(3)(4) *
Morris H. Fair 19,000 *
Jack H. Morris, III 20,000 *
All executive officers and directors as a group 3,442,467 26.7%
</TABLE>
* Indicates less than 1%.
(1) Beneficial ownership of Common Stock consists of sole voting and
investment power except as otherwise indicated.
(2) Wellington Management Company claims shared voting power with
respect to 934,930 shares and shared investment power with respect to
1,610,630 shares. Wellington Management Company does not claim sole
voting power or sole investment power with respect to any of these
shares.
(3) Includes shares of Common Stock owned by the M.S. Carriers, Inc.
Matched Stock/Savings Plan and allocated to the accounts of the
following named individuals: James W. Welch, 5,287 shares; Gary L.
Hardeman, 1,961 shares; M.J. Barrow, 3,414 shares; and Robert P. Hurt,
2,664 shares.
(4) Includes shares of Common Stock that the following named individuals
may acquire within the next 60 days by exercise of stock options:
James W. Welch, 76,666 shares; Gary L. Hardeman, 46,668 shares;
M.J. Barrow, 26,666 shares; and Robert P. Hurt, 13,334 shares.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, executive officers and holders of more than 10% of the
Company's Common Stock to file with the Commission initial reports of
ownership and reports of changes in ownership of Common Stock of the Company.
The Company believes that during the two fiscal years ended December 31, 1993
and December 31, 1994, its officers, directors and holders of more than 10%
of the Company's Common Stock complied with all Section 16(a) filing
requirements except that the Form 3 holdings of Jerry L. Stairs, Vice
President - Safety and Risk Management, one Form 4 transaction of John M.
Hudson, Vice President - Human Resources, and one Form 4 transaction of
Morris H. Fair, Director were filed late. In making these statements, the
Company has relied upon the written representations of its directors and
officers.
ELECTION OF DIRECTORS
(Item 1 on Proxy Card)
At the meeting, the shares represented by the enclosed proxy card
will be voted for the election of the eight nominees named below, unless
otherwise instructed on the proxy card. If you do not wish your shares to be
voted for particular nominees, please identify the exceptions in the
appropriate space provided on the proxy card.
If at the time of the meeting one or more of the nominees have
become unavailable to serve, shares represented by proxies will be voted for
the remaining nominees and for such other persons as may be determined by the
holders of such proxies or, if none, the size of the Board will be reduced.
The Board knows of no reason why any of the nominees will be unavailable or
unable to serve.
All of the nominees are members of the present Board. The table
below sets forth certain information regarding each nominee.
<TABLE>
<CAPTION>
Principal Occupation
Business Experience and
Other Directorships Director
Name Of Public Companies (1) Age Since
<S> <C> <C> <C>
Michael S. Starnes (2) Chairman of the Board, 50 1978
President and Chief Executive
Officer of the Company
Carl J. Mungenast (3) Executive Vice President and 55 1994
Chief Operating Officer
of the Company
James W. Welch Senior Vice President - Marketing 51 1982
of the Company
M.J. Barrow Senior Vice President - Finance, 50 1982
Secretary-Treasurer of the
Company
Gary L. Hardeman Senior Vice President - 53 1990
Operations of the Company
Robert P. Hurt Vice President-Maintenance, 60 1983
Assistant Secretary of the
Company
Morris H. Fair Senior Vice President, 65 1986
Union Planters Corporation
Jack H. Morris, III Chief Executive Officer of 64 1986
Auto Glass of Memphis, Inc.
</TABLE>
(1) Each of the nominees, except Mr. Mungenast has held substantially the
same principal occupation during the past five years.
(2) Mr. Starnes is the President and majority owner of TCX, Inc. See
"Executive Compensation- Certain Transactions." Mr. Starnes is also a
director of RFS Hotel Investors, Inc., a real estate investment trust.
(3) Mr. Mungenast was employed by Sears Roebuck &Company from 1958 until
his retirement in December 1993. At the time of his retirement, he was
Senior Vice President for Sears Logistics Services in Itasca, Illinois
and responsible for all distribution, transportation and home delivery
services for Sears. Mr. Mungenast's employment with the Company
commenced April 1, 1994.
ADDITIONAL INFORMATION RELATED
TO THE BOARD OF DIRECTORS
The Board of Directors has the responsibility for establishing
broad corporate policies and for the overall performance of the Company.
Members of the Board who are not officers are kept informed of the Company's
business through discussions with the Chairman and other officers, by
reviewing analyses and other reports, as well as by participating in Board
meetings. To assist the Board in carrying out its duties, the Board has
established an Audit Committee and an Executive Compensation Committee.
Regular meetings of the Board of Directors are held each quarter,
and special meetings are scheduled when required. The Board held four
meetings in 1994 and each director attended 75% or more of the meetings.
The Audit Committee meets with management and the independent
auditors to consider the adequacy of the internal controls of the Company and
the objectivity of financial reporting. The Audit Committee recommends to the
Board the appointment of the independent auditors. The members of the
Committee are Messrs. Starnes, Fair and Morris. The Committee met once during
1994 and each member attended the meeting.
The Executive Compensation Committee administers the Company's
Incentive Stock Option Plan and the Company's 1993 Stock Option Plan,
pursuant to which stock options are granted to officers and other key
employees. The Committee reviews and approves the salaries and other
remuneration arrangements for senior management. The members of the Committee
are Messrs. Starnes, Fair and Morris. The Committee met twice during 1994 and
each member attended the meetings.
Compensation of Directors
Directors who are not full-time employees receive a fee of $1,500
for each meeting of the Board they attend and for each Committee meeting they
attend if not held on a day on which a meeting of the Board is held.
Directors who are also officers of the Company receive no additional
compensation for services as directors.
PROPOSAL RESPECTING COMPANY'S NON-EMPLOYEE DIRECTORS
STOCK OPTION PLAN
(Item 2 on Proxy Card)
At its meeting on September 14, 1994, the Boardof Directors, upon
the recommendation of the Chairman, adopted the M.S. Carriers, Inc.
Non-Employee Directors Stock Option Plan (the ""Plan"). The Board is
submitting the Plan for shareholder approval and recommends that the
shareholders of the Company approve the Plan.
A copy of the Plan is attached hereto as Exhibit A. Terms not
otherwise defined herein shall have the meaning given such terms in the Plan.
The purpose of the Plan is to encourage ownership in the Company
by non-employee directors of the Company whose continued services are
considered essential to the Company's growth and progress. The Plan is also
designed to provide non-employee directors with a further incentive to
continue their association with the Company and to assure that the Company
can attract the most qualified persons to serve as non-employee directors.
The Plan provides that 20,000 shares of Common Stock shall be
reserved for use under the Plan. If any stock option shall expire or
terminate for any reason without having been exercised in full, the
unpurchased shares under such option shall again become available for use
under the Plan. The terms of any grant shall be determined under the Plan and
the related stock option agreement.
The following discussion summarizes the principal features of the
Plan. The discussion does not purport to be complete and is qualified in its
entirety by reference to the Plan.
# Administration. The Plan is administeredby the Board. Grants of
options are automatic under the Plan.
Participants. Each non-employee member of the Boardis a
participant in the Plan. No employees of the Company are eligible to
participate in the Plan.
Stock Options. On September 14, 1994, the effective date of the
Plan, Morris H. Fair and Jack H. Morris, III, the non-employee directors
currently serving the Company, were each granted options to purchase 2,500
shares of Common Stock at the option rice of $25.50 per share, which was 100%
of the fair market value of the Common Stock on the effective date of the
Plan. The options granted to Messrs. Fair and Morris vest and become
exercisable in five (5) equal annual installments on the anniversary dates of
the effective date of the Plan. The options granted to Messrs. Fair and
Morris shall be void if the shareholders of the Company shall not have
approved the adoption of the Plan within twelve (12) months after the
effective date of the Plan.
Each non-employee director elected to the Board subsequent to the
effective date of the Plan shall be granted, on the first business day
following his or her election to the Board, an option to purchase 2,500
shares of Common Stock. The option price covered by each stock option shall
be 100% of the fair market value of Common Stock on the date of grant. Each
stock option shall vest and become exercisable in five (5) equal annual
installments on the anniversary dates of the date of grant.
Option Terms. The term within each stock option is exercisable
shall be ten years from the date of the grant of an option under the Plan. An
option may only be exercised by the optionee except in cases of death or
total disability.
Termination of Directorship. If a non-employee director ceases to
be a director of the Company for any reason other than death or disability,
all options granted to him shall immediately terminate; provided, however,
the non-employee director shall have thirty (30) days from the date on which
he ceased to be a non-employee director to exercise any option or portion
thereof which was exercisable on the date that the non-employee ceased to be
a director of the Company.
If a non-employee director dies or becomes totally disabled
during his directorship, all options previously granted to the non-employee
director shall immediately vest and become exercisable; provided, however,
all options must be exercised prior to the earlier of (i) one (1) year after
the date on which the non-employee director dies or ceases to be a director
of the Company, or (ii) the expiration of the term of the option.
Non-Transferability. Options under the Plan shall be not
assignable or transferable other than by will or the laws of descent and
distribution. A stock option may be exercised during the non-employee
director's lifetime only by such director.
Amendment to the Plan. The Board may amend, suspend or terminate
the Plan; provided, however, that the Board may not amend the Plan without
approval of the Company's shareholders if such approval is required to comply
with Rule 16b-3 under the Securities Exchange Act of 1934 or the Tennessee
Business Corporation Act. The Plan shall not be amended more than once every
six months other than to comport with changes in the Internal Revenue Code,
the Employer Retirement Income Security Act, or the rules thereunder.
Federal Income Tax Summary. Under current regulations, the
options provided by the Plan are considered non-qualified stock options
("NQOs"). The optionee is not subject to any federal income tax upon the
grant of a NQO under the Plan nor will be grant of the NQO under the Plan resul
t in an income tax deduction for the Company. As a result of the exercise of
an NQO, the optionee generally will recognize ordinary income in an amount
equal to the excess of the fair market value of the shares of Common Stock
acquired on the dateof exercise over the amount paid therefor. The Company
generally will be entitled to a corresponding federal income tax deduction,
provided the Company satisfies applicable federal income tax withholding
requirements. Depending on the period the stock is held after exercise, the
sale or other taxable disposition of shares of Common Stock acquired through
the exercise of an NQO generally will result in a short- or long-term capital
gain or loss equal to the difference between the amount realized on such dispo
sition and the fair market value of such shares on the date of acquisition.
EXECUTIVE COMPENSATION
The following table discloses compensation paid by the Company to
its Chief Executive Officer and the four other most highly compensated
executive officers for the three fiscal years ended December 31, 1994:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-Term
Annual Compensation Compensation Other Compensation
Profit Sharing Matched Stock/ Life
Name and Principal Position Year Salary Bonus(1) Options Plan(2) Savings Plan(3) Insurance(4)
<S> <C> <C> <C> <C> <C> <C> <C>
Michael S. Starnes 1994 $313,190 $29,096 - $1,482 - $73,775
Chairman of the Board, 1993 300,942 36,112 60,000 1,482 - 59,704
President and Chief 1992 286,840 40,160 - 1,465 - 59,704
Executive Officer
Carl J. Mungenast 1994 190,401(5) 18,500 50,000 - - -
Executive Vice President 1993 - - - - -
and Chief Operating Officer 1992 - - - - -
James W. Welch 1994 179,178 16,574 20,000 1,185 - 4,052
Senior Vice President- 1993 170,522 20,463 - 1,185 - 4,016
Marketing 1992 161,500 22,600 - 1,179 $2,795 4,016
Gary L. Hardeman 1994 164,321 14,583 20,000 1,042 1,848 4,110
Senior Vice President- 1993 149,975 17,997 - 1,042 1,799 4,053
Operations 1992 138,000 22,100 - 1,025 3,822 4,053
M. J. Barrow 1994 135,313 12,188 20,000 854 2,772 4,313
Senior Vice President- 1993 122,944 14,753 - 854 2,698 4,273
Finance, Secretary, 1992 109,000 15,300 - 796 2,599 4,273
Treasurer
</TABLE>
(1) Includes amounts earned during the last quarter of 1994 but paid in first
quarter of 1995.
(2) The Company's contribution to the named individual's account in the
Company's Profit-Sharing Plan. Amounts listed for 1994 are estimates.
(3) The Company's contribution to the named individual's account in the
Company's Matched Stock/Savings Plan.
(4) Premiums paid by the Company on split-dollar life insurance policies
covering the named individual. Upon the death of an individual, the
Company will be reimbursed the amount it has paid in premiums.
(5) Carl J. Mungenast's employment with the Company commenced April 1, 1994.
The amount listed under this column includes $44,247 of reimbursed
relocation expenses.
OPTION GRANTS IN 1994
The following table provides information with respect to grants
of stock options to the Chief Executive Officer and each of the four other
most highly compensated executive officers during the year ended December 31,
1994.
Name Options Granted Date Exercisable Exercise Price
Michael S. Starnes - - -
Carl J. Mungenast 50,000 3/31/99 $22.625
James W. Welch 20,000 1/4/99 $20.75
Gary L. Hardeman 20,000 1/4/99 $20.75
M.J. Barrow 20,000 1/4/99 $20.75
AGGREGATED OPTION EXERCISES IN 1994 AND YEAR-END VALUE TABLE
The following table provides information with respect to stock
option exercises by the Chief Executive Officer and each of the four other
most highly compensated executive officers during the year ended December 31,
1994.
<TABLE>
<CAPTION>
Number of Value of Unexercised
Unexercised Options In-the-Money Options
At December 31, 1993 At December 31, 1993(2)
Shares Acquired Value
Name on Exercise Realized(1) Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Michael S. Starnes - - - 60,000 - -
Carl J. Mungenast - - - 50,000 - -
James W. Welch - - 76,666 33,334 $1,375,824 $214,176
Gary L. Hardeman - - 46,668 26,666 627,518 112,073
M. J. Barrow - - 26,666 33,334 388,323 214,176
</TABLE>
(1) This amount is the aggregate of the market value of the Common Stock
at the time that the stock option was exercised minus the exercise
price for the option.
(2) This amount is the aggregate of the number of options multiplied by
the difference between the last sale price of the Common Stock on
December 31, 1994, in the over-the-counter market as reported by the
National Association of Securities Dealers Automated Quotations System
minus the exercise price for those options.
Certain Transactions
Mr. Starnes owns 75% of the common stock of TCX, Inc., a Tennessee
corporation ("TCX"). TCX is a less-than-truckload motor common carrier
providing services from Memphis, Tennessee to California via piggyback
trailers owned by certain railroads. TCX does not compete with the business
of the Company and there are no plans for TCX to become competitive with the
Company's business. During 1994, the Company obtained certain insurance and
fuel on behalf of TCX and charged TCX the actual cost of such insurance and
fuel. With respect to future transactions between the Company and TCX or any
of the officers, directors, shareholders or affiliates of any of them, all
such transactions shall be approved by a majority of the independent
directors of the Company and will be on terms no less favorable to the
Company than those which may be obtained from unaffiliated third parties.
REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE
The Executive Compensation Committee of the Board of Directors
(the "Committee") is composed of the Chairman of the Board and two Directors
who are not employees of the Company. The Committee is responsible for
establishing and administering the Company's executive compensation plans.
Compensation Philosophy and Objectives
The Company applies a consistent philosophy to compensation for
all employees, including senior management. This philosophy is based on the
premise that superior performance of the Company results from the coordinated
efforts of all employees working toward common objectives. The Company
strives to achieve those objectives through teamwork that is focused on
meeting the expectations of the Company's customers and shareholders.
The Company's goal is to attract, retain and reward executive
officers who contribute to the long-term success of the Company. The
philosophy underlying the executive compensation plans is the alignment of
compensation with the Company's business objectives and performance. In
addition, the Company seeks to align the interests of executive officers with
those of the shareholders. Key principles of this philosophy are:
Providing fairness in compensation plans which deliver pay
commensurate with the Company's performance and the individual's performance.
Providing equity-based incentives for the executive officers
to insure that they are motivated over the long term to manage the Company's
business as owners rather than just employees.
The Company strives to structure salaries for its executive
officers that are comparable with those of the Company's competitors and
other publicly held companies headquartered in Memphis, Tennessee. During
1993, the Company implemented an incentive plan for certain management and
administrative employees, including executive officers. Under this plan,
participants are awarded bonuses equal to a predetermined percentage (up to
40%) of their quarterly salaries based upon the Company's operating ratio for
the calendar quarter. The objective of the plan is to tie the management
group together as a team so that each person's efforts are focused towards
the profitability of the entire Company rather than towards the profitability
of individual departments within the Company. Approximately 250 employees
participated in the incentive plan in 1994.
The Company's Stock Option Plans are the vehicles utilized to
provide long-term incentives to executive officers. Grants under these plans
are tied to the value of the Company's Common Stock, thereby providing an
additional incentive for executive officers to maximize shareholder value.
Options granted under the plans have a term of ten years and vest over a
five-year period. An executive officer receives value from the grant of
options under these plans if the Company's Common Stock appreciates over the
long term and the executive officer continues in the employ of the Company.
Company Performance and CEO Compensation
Under the Company's incentive plan, Mr. Starnes, the Company's
CEO, was awarded a bonus equal to 9.3% of his base salary for 1994. This
bonus percentage was the same as the bonus percentage for all of the other
employees participating in the plan. The Committee also increased Mr.
Starnes' base salary by 4% which was the average percentage increase in the
base salaries of all management and administrative employees of the Company.
EXECUTIVE COMPENSATION COMMITTEE
Michael S. Starnes, Chairman
Morris H. Fair
Jack H. Morris III
COMPARISON OF CUMULATIVE TOTAL SHAREHOLDER RETURN (1)
[GRAPHI: 6 YEAR CHART]
YEAR ENDING DECEMBER 31
1989 1990 1991 1992 1993 1994
M.S. Carriers, Inc. 100 86 139 207 202 207
NASDAQ Combined
Composite Indes 100 82 130 149 171 165
Peer Group Index 100 85 145 199 238 176
(1) Assumes $100 invested on December 31, 1989 in M.S. Carriers, Inc.
Common Stock, NASDAQ Composite Index and Peer Group Index with
reinvestment of dividends.
(2) This peer group is composed of J.B. Hunt Transport Services, Inc.
and Werner Enterprises Inc., two other truckload carriers. This index
has not been weighted to reflect the relative market capitalization of
the peer group companies.
AUDITORS
The Board of Directors has appointed Ernst & Young as independent
auditors for the year ended December 31, 1995. One or more members of Ernst &
Young are expected to be present at the Annual Meeting, will have the
opportunity to make a statement, if they so desire, and will be available to
respond to appropriate questions.
SHAREHOLDER PROPOSALS
Proposals intended to be presented at the 1996 Annual Meeting of
Shareholders should be sent to M.J. Barrow, Secretary, M.S. Carriers, Inc.,
P. O. Box 30788, Memphis, Tennessee 38130-0788, and must be received by
December 15, 1995, in order to be included in the proxy materials for the
1996 annual meeting.
OTHER MATTERS
In addition to the matters described above, there will be an
address by the Chairman and a general discussion period during which
shareholders will have an opportunity to ask questions about the Company's
business.
If any matter not described herein should come before the
meeting, the persons named in the accompanying proxy card will vote the
shares represented by them in accordance with their best judgment. At the
time this proxy statement went to press, the Company knew of no other matters
which might be presented for shareholder action at the meeting.
OTHER INFORMATION
The enclosed proxy card is being solicited by the Board of
Directors and the entire cost of such solicitation will be paid by the
Company. If the proxy is properly executed, the shares represented by it will
be voted at the Annual Meeting. If a shareholder has specified how his shares
are to be voted, they will be voted in accordance with such specification. To
the extent necessary to assure sufficient representation at the meeting,
certain officers and other regular employees of the Company may, by telephone,
telegraph or personal interview, request the return of proxies.
It is intended that the shares represented by the proxy not
limited to the contrary will be voted in favor of all items listed on the
proxy and in the discretion of the persons named in the proxies on any other
matter which may properly come before the meeting.
FINANCIAL STATEMENTS
Financial statements for the Company are included in the Annual
Report to shareholders for the year 1994 delivered herewith, which report is
hereby incorporated by reference. Additional copies of these statements, as
well as the Annual Report to the Securities and Exchange Commission on Form
10-K, may be obtained without charge from M.J. Barrow, Secretary, M.S.
Carriers, Inc., P.O. Box 30788, Memphis, Tennessee 38130-0788.
The above notice and proxy statement are sent by order of the
Board of Directors.
M.J. Barrow
Secretary
EXHIBIT A
M.S. CARRIERS, INC. NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
1. PURPOSE
The purpose of the M.S. Carriers, Inc. Non-Employee Directors
Stock Option Plan (the "Plan") is, by the means of stock options, to
encourage ownership in M.S. Carriers, Inc. (the "Company") by non-employee
directors of the Company whose continued services are considered essential to
the Company's growth and progress and to provide non-employee directors with
a further incentive to continue as directors of the Company.
2. ADMINISTRATION
(a) The Plan shall be administered by the board of directors of
the Company (the "Board").
(b) Grants of options under the Plan and the amount and nature of
such grants shall be automatic in accordance with Section 4 hereof.
(c) All questions regarding the operation of the Plan shall be
referred to the Board and all decisions of the Board shall be final and
conclusive.
3. PARTICIPATION IN THE PLAN
Each non-employee member of the Board shall be a participant in
the Plan. No person who is also an employee of the Company or one of its
subsidiaries shall be a participant except with respect to any options
received prior to becoming such an employee.
4. STOCK OPTIONS
(a) Existing Non-Employee Directors. On the effective date of
this Plan, each non-employee director currently serving the Company shall be
granted an option to purchase 2,500 shares of the Company's common stock,
$.01 par value per share ("Common Stock").
(b) New Non-Employee Directors. Each non-employee director
elected to the Board subsequent to the effective date of this Plan shall be
granted on the first business day following his or her election to the Board,
an option to purchase 2,500 shares of the Company's Common Stock.
5. DETERMINATION OF OPTION PRICE
The option price of a share of Common Stock covered by each stock
option shall be 100% of the fair market value of Common Stock on the date of
grant of such stock option. Such fair market value shall be the average of
the high and low selling prices of a share of Common Stock as reported by The
Wall Street Journal on the date of grant of the stock option.
6. OPTION TERM
The term within which each stock option is exercisable shall be
ten years from the date of the grant of an option. While an optionee is a
director of the Company and in the case of an optionee who ceases to be a
director of the Company by reason of death or total disability, an option may
be exercised prior to its expiration only by the optionee or, in the case of
death, by the executor or administrator of optionee's estate or by a person
who acquired the right to exercise such option by bequestor inheritance. All
option privileges continue for one (1) year after death or total disability,
but not after the expiration of the option term. Otherwise, an option may only
be exercised within the thirty day period after an optionee ceases to be a
director of the Company.
7. VESTING OF OPTIONS
The stock options granted hereunder shall vest and become
exercisable, subject to the provisions of paragraph 8, in five (5) equal
installments on the anniversary dates of the date of grant as follows:
First anniversary date - 500 shares
Second anniversary date - 500 additional shares
Third anniversary date - 500 additional shares
Fourth anniversary date - 500 additional shares
Fifth anniversary date - 500 ADDITIONAL SHARES
2,500 TOTAL SHARES
Stock options that become exercisable in accordance with the foregoing shall
remain exercisable, subject to the provisions contained in the Plan, until
the expiration of the term of the stock option as set forth in Paragraph 6.
8. TERMINATION OF DIRECTORSHIP
(a) If a non-employee director ceases to be a director of the
Company for any reason other than death or disability, all stock options
previously granted to him shall immediately terminate; provided, however, the
non-employee director shall have thirty (30)days from the date on which he
ceased to be a non-employee director to exercise any option or portion
thereof which was exercisable on the date that the non-employee director
ceased to be a director of the Company.
(b) If a non-employee director dies during his directorship or
ceases to be a director of the Company by reason of his total disability, as
defined in section 105(a)(4) of the Internal Revenue Code of 1986, as amended
("Internal Revenue Code"), all options previously granted to the non-employee
director shall immediately vest and become exercisable; provided, however,
all options must be exercised by the non-employee director or his personal
representative, heirs or legatees prior to the earlier of (i) one (1) year
after the date on which the non-employee director dies or ceases to be a
director of the Company, or (ii) the expiration of the term of the options.
(c) Notwithstanding anything contained in this Plan to the
contrary, no stock option granted hereunder shall become exercisable prior to
the expiration of a six-month period following the date that such option is
deemed acquired by the non-employee director pursuant to Rule 16b-3 under the
Securities Exchange Act of 1934 (The "1934 Act").
9. OPTION AGREEMENTS
Each stock option shall be evidenced by a written option
agreement containing such terms and conditions, consistent with the
provisions of the Plan, as the Board shall from time to time determine.
10. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION
In the event of changes in the Common Stock by reason of stock
dividends, split-ups, recapitalizations, mergers, consolidations, combination
or exchanges of shares and the like, the maximum number of shares of Common
Stock subject to the Plan and the number of shares and option price per share
of all stock subject to outstanding options shall be adjusted as necessary to
maintain the proportionate interest of the optionees and preserve, without
exceeding, the value of the options.
11. TRANSFERABILITY OF OPTIONS
Options under the Plan shall not be assignable or transferable,
or subject to encumbrance or charge of any nature, otherwise than by will or
the laws of descent and distribution. Astock option may be exercised, during
the lifetime of a non-employee director to whom such option was granted, only
by such director.
12. AMENDMENT AND TERMINATION
The Board may at any time and from time to time amend, suspend or
terminate the Plan in whole or in part, provided, however, that the Board may
not amend the Plan without the approval of the Company's stockholders if such
approval is required to comply with Rule 16b-3 under the 1934 Act or the
Tennessee Business Corporation Actor any applicable rules of the National
Association of Securities Dealers, Inc. or the New York Stock Exchange; and
provided further, that the Plan shall not be amended more than once every six
months other than to comport with changes in the Internal Revenue Code, the
Employee Retirement Income Security Act, or the rules thereunder. No such
amendment, suspension or termination may, without the consent of a director
to whom an option shall theretofore have been granted, adversely affect the
rights of such directors under such option.
13. COMMON STOCK RESERVED FOR PLAN
Subject to adjustment under Section 10, the aggregate number of
shares of Common Stock which may be issued under options and which shall be
reserved for purposes of the Plan shall be 20,000. Authorized but unissued
shares or treasury shares or both may be utilized for purposes of the Plan.
Such number of reserved shares shall be reduced if and to the extent that
treasury shares rather than authorized but unissued shares of Common Stock
shall be utilized for purposes of the Plan. If any stock option shall expire
or terminate for any reason without having been exercised in full, the
unpurchased shares under such option shall again become available for
purposes of the Plan.
14. MANNER OF EXERCISE AND PAYMENT
(a) Stock options shall be exercised by delivery of written
notice to the Secretary of the Company setting forth the number of shares of
Common Stock with respect to which the option is to be exercised.
(b) Payment for all shares shall be made in cash or with Common
Stock or a combination of both delivered at the time an option, or any part
thereof, is exercised. No shares shall be issued until full payment therefor
has been made. Common Stock used as payment shall have been owned by the
optionee not less than six months preceding the date the option is exercised
and shall be valued at its fair market value on the date of payment.
15. MISCELLANEOUS PROVISIONS
(a) The grant of stock options under the Plan shall not confer
upon any director any of the rights of a shareholder until exercise of the
director's stock option and until the director shall have received a
certificate or certificates therefor.
(b) The grant of stock options under the Plan shall not be deemed
to create any obligation on the part of the Board to nominate any director
for re-election by the Company's shareholders or to limit the Board's
authority to remove any director.
16. DURATION OF PLAN
The Plan shall expire on the tenth anniversary of the earlier of
approval of the Board or the stockholders of the Company unless earlier
terminated, and no stock option shall be granted after expiration or
termination but stock options previously granted shall remain outstanding in
accordance with their applicable terms and conditions and the terms and
conditions of the Plan.
17. SECTION 16(b) COMPLIANCE
It is the intention of the Company that the Plan shall comply in
all respects with Rule 16b-3 under the 1934 Act and, if any Plan provision is
later found not to be in compliance with Section 16 of the 1934 Act, the
provision shall be deemed null and void, and in all events the Plan shall be
construed in favor of its meeting the requirementsof Rule 16b-3.
18. ADOPTION, APPROVAL AND EFFECTIVE DATE OF PLAN
The Plan shall be considered adopted and shall become effective
on the date the Plan is approved by the Board of Directors of the Company;
provided, however, that the Plan and any grants of Options thereunder, shall
be void, if the stockholders of the Company shall not have approved adoption
of the Plan within twelve months after each effective date.
Adopted By The Board of Directors
By Resolution dated September 14, 1994
/s/ M.J. Barrow
M.J. Barrow, Secretary
<ATTACHMENT>
<PROXY CARD>
PROXY CARD
M.S. CARRIERS, INC.
3171 Directors Row
Memphis, Tennessee 33116
This proxy is solicited on behalf of the Board of Directors for the
Annual Meeting on May 5, 1995.
The undersigned hereby appoints Michael S. Stames and M.J. Barrow,
as either of them, proxies, with the powers the undersigned would
possess if personally present, and with full power of substitution,
to vote all common shares of the undersigned in M.S. Carriers,
Inc., at the Annual Meeting of the Shareholders to be held at the
Company's Office, 3171 Directors Row, Memphis, Tennessee, beginning
at 9:00 a.m. on May 5, 1995, and at any adjournment thereof, upon
all subjects that may properly come before the meeting, including
the matters described in the proxy statement furnished herewith,
subject to any directions indicated on the other side of this card.
If no directions are given, the proxies will vote for the election
of all listed nominees, in accord with the Directors'
recommendations on the other subjects listed on the other side of
this card and, at their discretion, on any other matter that may
properly come before the meeting.
Your vote for the election of Directors may be indicated on the
other side. Nominees are Michael S. Starnes, Carl J. Mungenasi,
James W. Welch, M.J. Barrow, Gary L. Hardeman, Robert P. Hurt, Jack
H. Morris, III and Morris H. Fair.
Please sign on the other side and return promptly. If you do not
sign and return a proxy, or attend the meeting and vote by ballot,
your shares cannot be voted.
Please mark votes X
To vote your shares for all Director nominees, mark the "For" box
on item "1."
To withhold voting for all nominees, mark the "Withhold" box.
If you do not wish your shares voted "For" a particular nominee,
mark the "For All Except" box and enter the names of those you do
not want to vote for in the space provided; your shares will be
voted for the remaining nominees.
Directors recommend a vote "For"
With- For All
For hold Except*
1. Election of All ___ ___ ___
Directors
(Page 3)
*Exceptions____________________________________________________
_______________________________________________________________
_______________________________________________________________
For Against Abstain
2. Approval of Non- ___ ___ ___
Employee Directors
Stock Option Plan
(Page 4)
Please sign this proxy and return it promptly whether or not you
plan to attend the meeting. If signing for a corporation or
partnership or as agent, attorney or fiduciary. Indicate the
capacity in which you are signing. If you do attend the meeting and
decide to vote by ballot, such vote will supersede this proxy.
Sign here as name(s) appear on reverse side
x________________________________
x________________________________
Date___________________________, 1995
