<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------------
SCHEDULE 14D-9
(Rule 14d-101)
SOLICITATION / RECOMMENDATION STATEMENT
UNDER SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 2)
KLLM Transport Services, Inc.
(Name of Subject Company)
--------------------
KLLM Transport Services, Inc.
(Name of Person(s) Filing Statement)
Common Stock, par value $1.00 per share
(Title of Class of Securities)
482498102
(CUSIP Number of Class of Securities)
--------------------
Leland R. Speed
Chairman of the Special Committee of the Board of Directors
KLLM Transport Services, Inc.
135 Riverview Drive
Richland, Mississippi 39218
(601) 939-2545
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of the Person(s) Filing Statement)
With copies to:
Sidney J. Nurkin, Esq.
Alston & Bird LLP
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309
(404) 881-7000
[_] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
<PAGE>
This Amendment No. 2 amends and supplements the solicitation/recommendation
statement on Schedule 14D-9 filed with the U.S. Securities and Exchange
Commission (the "Commission") on June 2, 2000 (the "Schedule 14D-9"), as amended
by Amendment No. 1 thereto filed with the Commission on June 23, 2000 (the
"Amendment No. 1"), by KLLM Transport Services, Inc., a Delaware corporation
(the "Company"), in relation to the tender offer being made by High Road
Acquisition Subsidiary Corp., a Delaware corporation ("Purchaser"), which is a
wholly owned subsidiary of High Road Acquisition Corp., a Delaware corporation
("Parent"), to purchase all of the outstanding shares of Common Stock of the
Company at a purchase price of $8.05 per share, net to the seller in cash,
without interest thereon, less applicable withholding taxes, if any, (the "Offer
Price") upon the terms and subject to the conditions set forth in the
Purchaser's Offer to Purchase, dated June 2, 2000, as amended on June 23, 2000,
June 26, 2000 and June 28, 2000 (the "Offer to Purchase"), and in the related
Letter of Transmittal (which, together with the Offer to Purchase, constitutes
the "High Road Offer"). The High Road Offer is described in a Tender Offer
Statement on Schedule TO (as amended or supplemented from time to time, the
"Schedule TO"), filed by Parent and Purchaser with the Securities and Exchange
Commission (the "Commission") on June 2, 2000, as amended on June 23, 2000, June
26, 2000, and June 28, 2000. The High Road Offer is being made in accordance
with the Plan of Agreement and Merger, dated as of May 25, 2000, among Parent,
Purchaser and the Company (the "Merger Agreement"), a copy of which is
incorporated hereto as Exhibit (e)(1).
Item 4. The Solicitation or Recommendation.
(b) (i) Background of the High Road Offer; Contact with Parent.
The information set forth in Item 4(b)(i) is hereby amended and
supplemented by adding the following to the end of the first full paragraph on
page 18 of Item 4(b)(i) to the Schedule 14-9:
Mr. Grayson presented the oral opinion of Morgan Keegan to the Board as to
the fairness of the $7.80 per share offer, from a financial point of view, to
the Company's public stockholders. The full text of Morgan Keegan's written
opinion, dated May 25, 2000, to the Board, which sets forth the procedures
followed, assumptions made, matters considered and limitations on the review
undertaken in giving such opinion, is attached as Exhibit (a)(9) hereto and is
incorporated by reference in its entirety into this Schedule 14d-9.
The information set forth in Item 4(b)(i) is hereby further amended and
supplemented by adding the following to the end of Item 4(b)(i):
Opinion of Morgan Keegan
Morgan Keegan has acted as the Company's and Special Committee's exclusive
financial advisor in connection with the merger. The Company selected Morgan
Keegan based on Morgan Keegan's experience, reputation, and familiarity with the
Company's
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business. Morgan Keegan is a nationally recognized investment banking firm and
is regularly engaged in the valuation of businesses and securities in connection
with mergers and acquisitions, tender offers, leveraged buyouts, negotiated
underwritings, competitive biddings, secondary distributions of listed and
unlisted securities, private placements and valuations for corporate and other
purposes. In light of the foregoing, the Special Committee and Board believe
that Morgan Keegan is well qualified to provide the committee with independent,
quality financial assistance and advice, including the delivery of the fairness
opinion.
In connection with Morgan Keegan's engagement, the Special Committee
requested that Morgan Keegan evaluate the fairness, from a financial point of
view, to the unaffiliated stockholders of the Company, other than to the Liles
Group and its affiliates, of the aggregate consideration to be received by the
unaffiliated stockholders of the Company in the merger. On May 25, 2000, at a
meeting of the Board held to consider the merger, Morgan Keegan rendered to the
Board an oral opinion, which opinion was subsequently confirmed by delivery of a
written opinion dated May 25, 2000, to the effect that, as of that date and
based on and subject to the matters described in its opinion, the aggregate
consideration to be received by the unaffiliated stockholders in the merger was
fair, from a financial point of view, to them. The full text of Morgan Keegan's
written opinion, dated May 25, 2000, to the Board, which sets forth the
procedures followed, assumptions made, matters considered and limitations on the
review undertaken, is attached as Exhibit (a)(10) and is incorporated by
reference in its entirety into this Schedule 14d-9. Holders of the Company's
common stock are urged to read this opinion carefully in its entirety. Morgan
Keegan's opinion is addressed to the Board and states that, as of the date of
the opinion, based upon and subject to the assumptions, limitations and
qualifications set forth in such opinion, the aggregate consideration to be
received by the stockholders in the merger is fair, from a financial point of
view, to the unaffiliated stockholders (other than the Liles Group and its
affiliates). The following is a summary of the material financial analyses
performed by Morgan Keegan in connection with rendering its opinion and does not
purport to be a complete description of such analyses. In arriving at its
opinion, Morgan Keegan:
. reviewed the merger agreement;
. reviewed certain business and financial information relating to the Company;
. reviewed certain other information, including financial forecasts based on
assumptions that Morgan Keegan believed appropriate and which forecasts the
Company advised Morgan Keegan that it did not have reason to believe such
forecasts or assumptions were unreasonable;
. met with the management of the Company to discuss the business and prospects
of the Company;
. considered certain financial and stock market data of the Company, and
compared that data with similar data for other publicly held companies in
businesses similar to the Company;
. considered the results of the strategic evaluation process and other
proposals;
. considered the financial terms of other business combinations and other
transactions that have recently been effected; and
. considered such other information, financial studies, analyses and
investigations and financial, economic and market criteria that Morgan Keegan
deemed relevant.
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In connection with its review, Morgan Keegan did not assume any
responsibility for independent verification of any of the information that was
provided to or otherwise reviewed by it and relied on that information being
complete and accurate in all material respects. Morgan Keegan was not requested
to, and did not, make an independent evaluation or appraisal of the assets or
liabilities, contingent or otherwise, of the Company. Morgan Keegan's opinion
was necessarily based on information available to Morgan Keegan, and financial,
economic, market and other conditions as they existed and could be evaluated by
Morgan Keegan, on the date of its opinion. Although Morgan Keegan evaluated the
fairness from a financial point of view to the unaffiliated stockholders of the
Company, other than the Liles Group and its affiliates, of the aggregate
consideration to be received by the unaffiliated stockholders of the Company in
the Merger, Morgan Keegan was not requested to, and did not, recommend the
specific consideration payable in the Merger, which consideration was determined
in negotiations between the Company and the Liles Group.
In preparing its opinion to the Board, Morgan Keegan performed various
financial and comparative analyses, including those described below. The
summary of Morgan Keegan's analyses described below is not a complete
description of the analyses performed in connection with rendering its opinion.
The preparation of a fairness opinion is a complex analytical process involving
various determinations as to the most appropriate and relevant methods of
financial analysis and the application of those methods to the particular
circumstances and, therefore, a fairness opinion is not readily susceptible to
summary description. In arriving at its opinion, Morgan Keegan made qualitative
judgments as to the significance and relevance of each analysis and factor that
it considered. Accordingly, Morgan Keegan believes that its analyses must be
considered as a whole and that selecting portions of its analyses and factors or
focusing on information presented in tabular format, without considering all
analyses and factors or the narrative description of the analyses, could create
a misleading or incomplete view of the processes underlying its analyses and
opinion. In its analyses, Morgan Keegan considered industry performance,
general business, economic, market and financial conditions and other matters,
many of which are beyond the control of the Company. No company, transaction or
business used in Morgan Keegan's analyses as a comparison is identical to the
Company or the merger, and an evaluation of the results of those analyses is not
entirely mathematical. Rather, the analysis involves complex considerations and
judgments concerning financial and operating characteristics and other factors
that could affect the acquisition, public trading or other values of the
companies, business segments or transactions analyzed. The estimates contained
in Morgan Keegan's analyses and the ranges of valuations resulting from any
particular analysis are not necessarily indicative of actual values or
predictive of future results or values, which may be significantly more or less
favorable than those suggested by the analyses. In addition, analyses relating
to the value of businesses or securities do not necessarily purport to be
appraisals or to reflect the prices at which businesses or securities actually
may be sold. Accordingly,
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Morgan Keegan's analyses and estimates are inherently subject to substantial
uncertainty. Morgan Keegan's opinion and financial analyses were among many
factors considered by the Board in its evaluation of the merger and should not
be viewed as determinative of the views of the Board or management with respect
to the merger or the aggregate consideration to be received.
The following is a summary of the material financial analyses underlying
Morgan Keegan's oral and written opinions delivered to the Board in connection
with the merger. The financial analysis summarized below includes information
presented in tabular format. In order to fully understand Morgan Keegan's
financial analyses, the table must be read together with the text. The table
alone does not constitute a complete description of the financial analyses. You
are urged to read the full narrative description of the financial analyses,
including the methodologies and assumptions underlying the analyses, or
otherwise you may have a misleading or incomplete view of Morgan Keegan's
financial analyses.
Morgan Keegan derived implied share price reference ranges based on a
discounted cash flow analysis, selected companies analysis, selected mergers and
acquisitions analysis and selected premiums analysis for the Company as more
fully described below. Morgan Keegan then compared the consideration to be
received in the Merger of $8.05 per Share with the share price reference ranges
implied by these analyses.
Share Price Reference Range Analysis. Morgan Keegan compared the price to
be paid in the proposed transaction to the closing price of the last trading day
of each month from May 1999 through April 2000. Morgan Keegan observed that the
Company's share price was declining steadily between May and October 1999, when
Mr. Low began acquiring beneficial ownership of the Company's stock. Morgan
Keegan noted that the closing price on November 30, 1999 of $6.16 was 28.7%
greater than it was on October 29, 1999 ($4.75 per Share). Morgan Keegan also
observed that after Mr. Low announced his intent on March 16, 2000 to acquire
the Company, the Company share price increased steadily between that date and
April 28, 2000. The closing price on April 28, 2000 was $8.13, which represents
a 66.3% increase from February 29, 2000 ($5.50 per Share) and a 71.2% increase
from October 29, 1999 ($4.75 per share).
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<PAGE>
Closing Price Table for the Twelve Months Prior to May 1, 2000
Date Closing Price
---- -------------
May 26, 1999 $6.75
June 30, 1999 $5.75
July 29, 1999 $5.94
Aug. 31, 1999 $5.00
Sept. 30, 1999 $4.88
Oct. 29, 1999 (1) $4.75
Nov. 30, 1999 $6.16
Dec. 31, 1999 $4.75
Jan. 31, 2000 $5.25
Feb. 29, 2000 $5.50
Mar. 31, 2000 (2) $6.94
April 28, 2000 $8.13
Note: (1) Based on Mr. Low's filing with the Commission, he acquired beneficial
ownership of 289,000 shares of Common Stock of the Company between
October 1999 through December 1999.
(2) Based on Mr. Low's filing with the Commission, he acquired beneficial
ownership of 250,000 additional shares on February 10, 2000.
Selected Companies Analysis. Morgan Keegan compared selected financial,
operating and stock market data of the Company to corresponding data of several
publicly traded companies in the trucking industry, including:
Selected temperature-controlled carriers:
. Frozen Food Express;
. Marten Transport, Ltd.; and
. Simon Transportation.
Selected dry van truckload carriers:
. Cannon Express, Inc.; . MS Carriers;
. Covenant Transport, Inc.; . PAM Transportation;
. Heartland Express; . Swift Transportation;
. Intrenet, Inc.; . Transit Group, Inc.;
. J.B. Hunt; . Transport Corp. of America;
. Knight Transportation; . U.S. Xpress Enterprises;
. LandAir; . USA Truck, Inc.; and
. Landstar Systems, Inc.; . Werner Enterprises, Inc.
Morgan Keegan reviewed enterprise values, calculated as fully diluted
equity market value, plus total debt, preferred stock and minority interests,
less cash and cash equivalents of the selected companies, as multiples of their
last twelve months revenues, EBITDA, and EBIT. Morgan Keegan also reviewed the
market value of the selected companies' stock, calculated on a fully diluted
basis, as a multiple of such companies' net income for the last twelve months.
Morgan Keegan then applied the applicable multiples derived from this analysis
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to KLLM's revenues EBIT, EBITDA, net income and tangible book value for the last
twelve months ended March 31, 2000 and projected EDIT, EBITDA, net income and
tangible book value for calendar year 2000. Projected results were used to
derive an implied price per share in the future. These derived future share
prices were discounted to the present value using an assumed 18.6% cost of
equity capital. Multiples for the dry van carriers comp group were deemed less
applicable than multiples for the temperature-controlled comparable group due to
the difference in profitability between KLLM and most dry van carriers, because
temperature-controlled carriers typically have a higher cost structure, without
commensurately higher revenue rates per mile, than do dry van carriers. In
addition, Morgan Keegan deemed KLLM's temperature-controlled comparable group to
be more applicable than the dry van comparable group due to the fact that the
temperature-controlled division generates over 80% of the Company's revenues.
EBIT multiples were deemed more applicable than were EBITDA multiples due to the
fact that for most trucking companies, annual capital expenditures for new
tractors and trailers equals or exceeds depreciation expense for similar
equipment. As a result, in the trucking industry, EBIT is deemed to be a better
proxy of free cash flow than is EBITDA. The analysis assumed a cost of equity of
18.6%, a net debt outstanding of approximated $47 million and 4,101,000 shares
outstanding. The table set forth below shows the selected companies analysis
used by Morgan Keegan.
<TABLE>
<CAPTION>
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Comparable Company Analysis
--------------------------------------------------------------------------------------------------------------------
Based on Last Twelve Months (3/31) Results
-----------------------------------------------------------------------------
Applicable Last 12 Enterprise Equity Share
Multiples Months Value Value Value
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Temperature-
Controlled Carriers
Revenues 0.2x $236,857 $47,371 $ 420 $ 0.10
EBITDA 3.3x $ 20,138 $66,455 $19,504 $ 4.76
EBIT 7.3x $ 1,317 $ 9,614 NM NM
Net Income 6.6x $ (1,567) NA NM NM
Tangible Book Value 0.6x $ 49,979 NA $30,987 $ 7.56
Dry Van Carriers
EBITDA 4.5x $ 20,138 $90,621 $43,670 $10.65
EBIT 8.6x $ 1,317 $11,326 NM NM
Net Income 10.0x $ (1,567) NA NM NM
Tangible Book Value 1.3x $ 49,979 NA $64,973 $15.84
--------------------------------------------------------------------------------------------------------------------
</TABLE>
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<TABLE>
<CAPTION>
Based on 2000 Projections Results
------------------------------------------------------------------------------------
Applicable 2000 Enterprise Equity Share Discounted
Multiples Projections Value Value Value Price/Share
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Temperature-
Controlled
Carriers
Revenues 0.2x $244,941 $ 48,988 $ 2,037 $ 0.50 $ 0.42
EBITDA 3.3x $ 25,750 $ 84,975 $38,024 $ 9.27 $ 7.82
EBIT 7.3x $ 6,155 $ 44,932 NM NM NM
Net Income 6.6x $ 1,437 NA $ 9,484 $ 2.31 $ 1.95
Tangible Book 0.6x $ 52,404 NA $32,490 $ 7.92 $ 6.68
Value
Dry Van Carriers
EBITDA 4.5x $ 25,750 $115,875 $68,924 $16.81 $14.17
EBIT 8.6x $ 6,155 $ 52,933 $ 5,982 $ 1.46 $ 1.23
Net Income 10.0x $ 1,437 NA $14,370 $ 3.50 $ 2.95
Tangible Book 1.3x $ 52,404 NA $68,125 $16.61 $14.01
Value
----------------------------------------------------------------------------------------------------------------
</TABLE>
Discounted Cash Flow Analysis. Morgan Keegan also performed a discounted
cash flow analysis, which resulted in an implied range of less than zero to
$1.33 per Share, based on an illustrative range of multiples of unlevered free
cash flow and discount rates. Unlevered free cash flow is defined as after tax
income from operations, less capital expenditures, plus depreciation and
amortization and change in working capital. The analysis assumed a net debt
outstanding of approximately $47 million and 4,101,000 shares outstanding The
tables set forth below illustrates the implied value per Share at various
multiples of unlevered free cash flow and discounts rates.
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
Illustrative Multiple of Unlevered Free Cash Flow
Illustrative ---------------------------------------------------
Weighted Average
Cost of Capital Rate 5.0 x 6.0 x 7.0 x
-------------------- ----- ----- -----
<S> <C> <C> <C>
11.06%................................................... $ (.79) $ .27 $1.33
12.06%................................................... $(1.13) $ (.11) $ .90
13.06%................................................... $(1.46) $ (.48) $ .49
14.06%................................................... $(1.77) $ (.83) $ .11
15.06%................................................... $(2.07) $(1.17) $(.27)
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</TABLE>
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Premium Analysis. Morgan Keegan analyzed the premiums paid for all
completed mergers and acquisitions of publicly traded trucking companies with
transaction values up to $500 million and for certain non-financial institutions
and non-technology companies with transaction values between $25 million and
$100 million. Morgan Keegan analyzed premiums paid over the target's stock price
one day, one week and one month prior to the announcement date. Morgan Keegan
than derived an implied price per share based on the median premiums paid in
these transactions. For the purposes of this analysis, the announcement date was
March 16, 2000, which is the date that Mr. Low announced in his Schedule 13D
filing his intention to acquire the Company for $7.60 per share. The table set
forth below depicts the results of this analysis.
<TABLE>
<CAPTION>
Time Period Prior to Announcement Date
----------------------------------------------------
One Day One Week One Month
----------------------------------------------------
<S> <C> <C> <C>
Trucking Company Transactions $8.13 $7.71 $9.84
Other Selected Transactions $7.99 $7.30 $9.37
---------------------------------------------------------------------------------------------------
</TABLE>
Selected Mergers and Acquisitions Analysis. Morgan Keegan also applied
median valuation multiples calculated from prices paid in publicly announced
transactions to the Company's financial information. All multiples were based on
publicly available financial information. This analysis indicated an implied
range of $3.84 to $16.82 per Share when the derived multiples were applied to
the Company. The mergers and acquisitions analysis was relied on less than the
other analyses due to fact that multiples can vary significantly based on the
type of consideration being paid. Multiples are typically higher for
transactions involving stock, seller notes and contingent payouts than they are
for transactions involving 100% cash, as is the case in the proposed
transaction. Also, EBIT multiples were deemed more applicable than were EBITDA
multiples for the reasons stated above. The table set forth below shows the
mergers and acquisitions analysis used by Morgan Keegan.
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<TABLE>
<CAPTION>
Mergers & Acquisitions Analysis
Based on Last Twelve Months (3/31) Results
--------------------------------------------------------------------------------
Median Last Twelve Enterprise Equity Share
Multiples Months Value Value Value
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Revenues 0.4x $236,857 $ 94,743 $47,792 $11.65
EBITDA 5.0x $ 20,138 $100,690 $53,739 $13.10
EBIT 11.2x $ 1,317 $ 14,750 NM NM
Net Income 13.0x $ (1,567) NA NM NM
---------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Based on 2000 Projection Results
------------------------------------------------------------------------
Median 2000 Enterprise Equity Share Discounted
Multiples Projection Value Value Value Price/Share
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Revenues 0.4x $244,941 $ 97,976 $51,025 $12.44 $10.49
EBITDA 5.0x $ 25,750 $128,750 $81,799 $19.95 $16.82
EBIT 11.2x $ 6,155 $ 68,936 $21,985 $ 5.36 $ 4.52
Net Income 13.0x $ 1,437 NA $18,681 $ 4.56 $ 3.84
------------------------------------------------------------------------------------------------
</TABLE>
Projections. In the course of its analysis, Morgan Keegan prepared
projections of the future financial performance of the Company through fiscal
year 2004 using various assumptions. These projections were based upon Morgan
Keegan's analysis of the Company's financial performance through fiscal year
2000 made by Morgan Keegan in connection with its regular research efforts
concerning the Company. Such analysis was based on the historical performance
of the Company and publicly available information and such assumptions as Morgan
Keegan believed to be appropriate. From its analysis of the Company's financial
performance through fiscal year 2000, Morgan Keegan prepared additional
projections of the Company's financial performance thorough 2004, based upon
such additional assumptions as it considered appropriate. These projections of
the Company's performance and the assumptions made by Morgan Keegan in
developing their projection were then furnished to the Company for review. The
Company advised Morgan Keegan that it did not have reason to believe that such
projections or such assumptions were unreasonable. Accordingly, such
projections, and the underlying assumptions, were incorporated into Morgan
Keegan's analysis of the fairness, from a financial point of view, of the
various offers.
Morgan Keegan included such projections in its written presentations to the
Board. The Company does not as a matter of course publicly disclose or confirm
projections as to future revenues or earnings, but the Company advised Morgan
Keegan that it did not have reason to believe that such projections or the
underlying assumptions were unreasonable to assist Morgan Keegan in analyzing
the proposed acquisition of the Company.
The projections prepared by Morgan Keegan are set forth below.
<TABLE>
<CAPTION>
----------------- ----------------- ----------------- ----------------- ----------------
2000P 2001P 2002P 2003P 2004P
----------------- ----------------- ----------------- ----------------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $244,941 100.0 % 251,065 100.0 % 261,108 100.0 % 271,552 100.0 % 282,414 100.0 %
Operating Expenses
Salaries, wages and benefits 85,565 34.9 87,245 34.7 90,605 34.7 93,550 34.5 96,868 34.3
Operating supplies and expenses 60,286 24.6 60,256 24.0 62,666 24.0 64,901 23.9 67,497 23.9
Insurance, taxes and licenses 10,223 4.2 10,545 4.2 10,967 4.2 11,406 4.2 11,862 4.2
Depreciation and amortization 19,595 8.0 20,085 8.0 20,888 8.0 21,724 8.0 22,592 8.0
Purchased transportation 52,772 21.5 54,481 21.7 56,660 21.7 58,926 21.7 61,283 21.7
Other 10,345 4.2 10,545 4.2 10,967 4.2 11,406 4.2 11,862 4.2
-------- ----- -------- ----- -------- ----- -------- ----- -------- -----
Total operating expenses 238,786 97.5 243,157 96.9 252,753 96.8 261,912 96.5 271,965 96.3
-------- ----- -------- ----- -------- ----- -------- ----- -------- -----
Operating income 6,155 2.5 7,908 3.1 8,355 3.2 9,640 3.5 10,449 3.7
Other expenses (40) (0.0) (50) (0.0) (52) (0.0) (54) (0.0) (56) (0.0)
Interest expense 3,800 1.6 4,200 1.7 4,439 1.7 4,616 1.7 4,801 1.7
-------- ----- -------- ----- -------- ----- -------- ----- -------- -----
Total Other (Income) Expense 3,760 1.5 4,150 1.7 4,387 1.7 4,562 1.7 4,745 1.7
-------- ----- -------- ----- -------- ----- -------- ----- -------- -----
Income Before Provision for Taxes 2,395 1.0 3,758 1.5 3,968 1.5 5,078 1.9 5,705 2.0
Provision for Income Taxes 958 0.4 1,503 0.6 1,587 0.6 2,031 0.7 2,282 0.8
-------- ----- -------- ----- -------- ----- -------- ----- -------- -----
Net Income $ 1,437 0.6 % $ 2,255 0.9 % $ 2,381 0.9 % $ 3,047 1.1 % $ 3,423 1.2 %
======== ===== ======== ===== ======== ===== ======== ===== ======== =====
Diluted Earnings per Share $ 0.35 $ 0.55 $ 0.58 $ 0.74 $ 0.83
Diluted Shares Outstanding 4,100 4,100 4,100 4,100 4,100
------------------------------------------------------------------------------------------------------------------------------------
Operating Income $ 6,155 2.5 % $ 7,908 3.1 % $ 8,355 3.2 % $ 9,640 3.5 % $ 10,449 3.7 %
Depreciation and Amortization 19,595 8.0 20,085 8.0 20,888 8.0 21,724 8.0 22,592 8.0
-------- ----- -------- ----- -------- ----- -------- ----- -------- -----
EBITDA $ 25,750 10.5 % $ 27,993 11.1 % $ 29,243 11.2 % $ 31,363 11.5 % $ 33,042 11.7 %
======== ===== ======== ===== ======== ===== ======== ===== ======== =====
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
The projections were not prepared with a view to public disclosure and are
included in this document only because the information was used by Morgan Keegan
for this limited purpose. The projections were not:
---
. prepared with a view to compliance with the published guidelines of the SEC
regarding projections;
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. prepared in accordance with the guidelines established by the American
Institute of Certified Public Accountants for preparation and presentation of
financial projections; or
. reviewed by the Company's auditors.
The projections are forward-looking statements reflecting numerous
assumptions about many factors that are impossible to predict with any degree of
accuracy, many of which are beyond management's control, and as such are subject
to risks and uncertainties that could cause actual results to differ materially
from the results forecasted by the projections. The inclusion of the projections
should not be regarded as an indication that Morgan Keegan considered or
consider the projections to be a reliable prediction of future events. In
addition, neither Morgan Keegan nor the Company intends to update or otherwise
publicly revise the projections to reflect circumstances existing after the date
they were made, even if any or all of the assumptions underlying the projections
are shown to be in error, or if experience or future changes make it clear that
results predicted by the models will not be realized. The projections were not
used with a view to reliance by the Company's stockholders in making a decision
in connection with the Offer or the Merger or in making any other investment
decision. Therefore, the Company's stockholders are cautioned not to rely upon
the projections.
Item 9. Exhibits.
The information set forth Item 9 is hereby amended and supplemented by
inserting the following:
EXHIBIT NO. DESCRIPTION
----------- ---------------------------------------------------------
(a)(9) Written Presentation to the Board of Directors prepared
by Morgan Keegan & Company, Inc. dated May 25, 2000.
(a)(10) Written Presentation to the Board of Directors prepared
by Morgan Keegan & Company, Inc. dated May 25, 2000.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: June 30, 2000 KLLM TRANSPORT SERVICES, INC.
By: /s/ Leland R. Speed
-----------------------------------
Leland R. Speed, Chairman of the Special
Committee of the Board of Directors
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