Travel Ports of America, Inc.
3495 Winton Place, Building C
Rochester, New York 14623
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
October 24, 1995
The Annual Meeting of the Shareholders of Travel Ports of
America, Inc., a New York corporation, will be held at the
Gateway Banquet & Conference Center, 4853 West Henrietta
Road, Henrietta, New York 14467, on Tuesday, October 24,
1995, at 9:00 a.m. (local time), for the purpose of
considering and acting upon the following:
1. The election of directors;
2. The approval of the 1995 Employees Incentive Stock
Option Plan; and
3. The transaction of such other business as properly
may come before the meeting or any adjournment thereof.
Shareholders of record at the close of business on September
14, 1995 are entitled to notice of and to vote at the
meeting.
Shareholders are cordially invited to attend the Annual
Meeting. However, whether or not you plan to attend, you are
urged to sign, date and return promptly the enclosed proxy
in the accompanying envelope.
By Order of the Board of Directors
William Burslem III
Secretary
September 18, 1995
TRAVEL PORTS OF AMERICA, INC.
3495 Winton Place, Building C
Rochester, New York 14623
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD OCTOBER 24,
1995
This proxy statement is furnished to the shareholders
of Travel Ports of America, Inc. in connection with the
solicitation of proxies for use at the Annual Meeting of
Shareholders to be held October 24, 1995, and at all
adjournments thereof, for the purposes set forth in the
accompanying Notice of Annual Meeting of Shareholders.
Whether or not you expect to be personally present at
the meeting, you are requested to fill in, sign, date, and
return the enclosed form of proxy. Any person giving such
proxy has the right to revoke it at any time before it is
voted. All shares represented by duly executed proxies in
the accompanying form will be voted unless they are revoked
prior to the voting thereof.
The close of business on September 14, 1995 is the
record date for the determination of shareholders entitled
to vote at the Annual Meeting of the Shareholders. The stock
transfer books will not be closed. As of the record date,
there were outstanding and entitled to be voted at such
meeting 5,209,924 shares of Common Stock. The holders of the
Common Stock are entitled to one vote for each share of
Common Stock held on the record date.
A copy of the Company's Annual Report to Shareholders
for the fiscal year ended April 30, 1994, has been included
with this proxy statement and the accompanying proxy.
The solicitation of the accompanying proxy is made by
the Board of Directors of the Company. The solicitation will
be by mail and the expense thereof will be paid by the
Company. In addition, solicitation of proxies may be made by
telephone or telegram by officers or regular employees of
the Company.
ELECTION OF DIRECTORS
Nominees for Election as Directors
Seven directors of the Company are to be elected to
hold office until the next annual election and until their
respective successors have been duly elected and qualified.
Certain information with respect to the nominees for
election of directors proposed by the Company is set forth
below. Should any one or more of the persons named be unable
or unwilling to serve (which is not expected), the proxies
(except proxies marked to the contrary) will be voted for
such other person or persons as the Board of Directors of
the Company may recommend.
The Board of Directors recommends a Vote FOR the
election of all nominees for director.
Biographical Summaries of Nominees
Served as
Name, Principal Occupation Age Director Since
E. Philip Saunders, Chairman of
The Board of Directors
of the Company and Chief Executive Officer 58 1979
John M. Holahan, President of the Company 55 1979
William Burslem III, Vice President and
Secretary of the Company 51 1991
Dante Gullace, Attorney-at-Law 63 1979
William A. DeNight, Independent Business Consultant 61 1986
John F. Kendall, Chief Operating Officer of Perk
Development Corporation 52 1988
John O. Eldredge, * Certified Public Accountant 64 1991
* Member of the Audit Committee of the Board of Directors
Mr. Saunders has been Chairman of the Board of
Directors and Chief Executive Officer of the Company for
more than five years. In addition to his relationship with
the Company, he is the Chief Executive Officer of Sugar
Creek Corporation, which operates, through subsidiaries,
convenience stores and a petroleum distribution business.
Mr. Holahan has been President and Chief Operating
Officer of the Company for more than five years.
Mr. Burslem has been the Vice President, Finance;
Secretary; and Chief Financial Officer of the Company since
March 1991. From July 1987 until March 1991 he was Vice
President, Finance; Secretary; and Chief Financial Officer
of Sugar Creek Corporation.
Mr. Gullace has been a member of the firm of Gullace,
Easton & Weld, the Company's counsel, for more than five
years.
Mr. DeNight has acted as an independent business
consultant, primarily in the transportation industry, for
more than five years.
Mr. Kendall has been Chief Operating Officer of Perk
Development Corporation, which is engaged in the operation
of several Perkins Family Restaurants, for more than five
years.
Mr. Eldredge has been a partner in the firm of
Eldredge, Fox & Porretti, Certified Public Accountants, for
more than five years.
PRINCIPAL SHAREHOLDERS
Under the regulations of the Securities and Exchange
Commission, persons who have power to vote or dispose of
shares of the Company, either alone or jointly with others,
are deemed to be beneficial owners of such shares.
The following table sets forth the number of shares of the
Company's Common Stock beneficially owned as of the record
date by (i) each person known by the Company to own,
beneficially, more than 5% of its outstanding Common Stock,
(ii) each director of the Company other than the directors
named under (i) below, and (iii) all officers and directors
of the Company as a group:
Number of Shares
Name (1) Beneficially Owned % of Class
(I) E. Philip Saunders 1,600,000(2) 30.70%
Phoenix Associates II 546,800 10.49%
John M. Holahan 505,000(3) 9.69%
FMR Corp. 339,000 6.51%
(ii) William A. DeNight 100 less than 1%
John F. Kendall 1,500 less than 1%
William Burslem III 500(4) less than 1%
(iii) All Officers and
Directors as a group,
including those
named above 2,107,100(2,3,4) 40.44%
(1) Unless otherwise noted, the shareholders referred to
above have sole voting and investment
power with respect to the Common Stock which they own.
(2) Does not include (a) 100,00 shares into which
Convertible Debentures held by Mr. Saunders may be
converted or (b) 1,000 shares available if Mr.
Saunders exercises warrants that he holds.
(3) Does not include (a) options to purchase 100,000 shares,
granted to Mr. Holahan under the
Company's Incentive Stock Option Plans, discussed
below, (b) 16,666 shares into which Convertible
Debentures held by Mr. Holahan may be converted or (c)
166 shares available if Mr. Holahan
exercises warrants that he holds.
(4) Does not include options to purchase 45,000 shares,
granted to Mr. Burslem under the
Company's Incentive Stock Option Plans, discussed
below.
CERTAIN BUSINESS RELATIONSHIPS
In March 1984, the Company entered into a 20-year
sublease with Maybrook Realty, Inc., a corporation owned by
Mr. Saunders and another individual, for its Maybrook, New
York travel plaza. The lease expires in March 2004 and
provides for the Company to pay rent at the rate of $37,500
per month, plus all utilities, taxes, and other charges and
expenses related to the property. The future minimum rental
commitment for the non-cancelable lease amounts to $262,500
during the balance of fiscal 1995/96, $450,000 in fiscal
1996/97, $450,000 in fiscal 1997/98, and $2,662,500 for the
remaining term of the lease. The Company has three five-year-
renewal options at monthly rentals of $41,250 (during the
first renewal term), $45,375 (during the second renewal
term), and $49,912 (during the third renewal term). The
Company also has an option to purchase the travel plaza for
$3,500,000 at the end of the original term or any renewal
term. On the basis of its experience with other truck stops,
the Company believes that the terms of this lease are at
least as favorable as terms that could have been obtained
for a similar facility from a disinterested landlord in
arms' length negotiations.
On May 1, 1986, the Company purchased its Belmont, New
York facility from a corporation owned by Messrs. Saunders
and Griffith. The facility was purchased for $450,000 cash,
with an additional agreement by the Company to pay $150,000
more out of future earnings of the facility. To date, the
Company has paid $93,547 of the additional price. On the
basis of its experience with other truck stops, the Company
believes the acquisition terms are at least as favorable as
terms that could have been obtained for a similar facility
from a disinterested seller in arms' length negotiations.
In January 1986, the Company entered into a 10-year
agreement with W.W. Griffith Oil Co., Inc. ("Griffith Oil"),
a subsidiary of Sugar Creek Corporation (a corporation owned
by Mr. Saunders), pursuant to which Griffith Oil supplies
gasoline and diesel fuel to the Company's facilities in
Dansville, Binghamton, and Belmont, New York. These three
locations represent approximately 13% of the Company's total
requirements for petroleum products. The agreement provides
that the Company will purchase the products for Griffith
Oil's cost, plus trucking, plus a fixed margin equal to $.01
per gallon. The Company also buys fuel for other locations
from Griffith Oil on the same basis. In addition, the
Company purchases diesel fuel at its Berwick, Pennsylvania
bulk fuel facility from Griffith Oil pursuant to an
agreement that can be canceled at any time. Under this
agreement, the Company purchases product for Griffith Oil's
cost plus $.0025 per gallon. During the fiscal year ended
April 30, 1995, the Company purchased approximately
$18,833,000 in petroleum products from Griffith Oil pursuant
to these arrangements. On the basis of its experience in
purchasing from other suppliers and its continuous review of
the markets, the Company believes that the terms of these
agreements are as favorable to the Company as the terms
available from any other supplier of petroleum products.
The Company retained Mr. Gullace's law firm as its
general counsel in fiscal year 1994/95 and continues to
retain them in 1995/96.
Board of Directors and Committees
There were three meetings of the Board of Directors
during the fiscal year ended April 30, 1995. All directors
attended each meeting. Each non-employee director is
currently paid $750 plus his expenses for attendance at each
Board meeting. The Board has only one committee, the Audit
Committee. Except as described below, all of the remaining
functions of the Board are performed by the full Board.
The functions of the Audit Committee are to review the
Company's reports to the shareholders with management and
the independent auditors to assure that appropriate
disclosure is made; to recommend the firm of independent
auditors for appointment to perform the annual audit; to
review and approve the scope of the independent auditors'
work; to review the effectiveness of the Company's internal
controls; and related matters. The Committee met with the
Company's chief financial officer two times and met with the
Company's independent auditors two times during the fiscal
year ended April 30, 1995.
Executive Compensation
The following table sets forth information concerning
the cash compensation paid or accrued by the Company for the
Chief Executive Officer and each executive officers who
received total compensation in excess of $100,000.
SUMMARY COMPENSATION TABLE
Annual Compensation
Name and Other Annual
Position Year Salary ($) Bonus($) Compensation ($)
E. Philip Saunders 1995 None 81,016 123,800
CEO 1994 None 115,635 123,800
1993 None 64,363 123,800
John M. Holahan 1995 187,720 173,771 None
President and COO 1994 187,720 205,450 None
1993 187,720 86,381 None
William Burslem III 1995 102,012 48,864 None
Vice President, CFO 1994 99,000 47,066 None
and Secretary 1993 94,962 30,500 None
There was no Long Term Compensation or Other
Compensation of any kind paid or accrued. The Option/SAR
Grants in the last fiscal year are detailed in the schedule
below. There were no Aggregated Option/SAR Exercises in the
last fiscal year. There were no Long-term Incentive Plans -
Awards in the last fiscal year. The Company has no Pension
Plan. There were no Ten-year Option/SAR Repricings in the
last fiscal year. There were no other New Plan Benefits in
the last fiscal Year.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Potential Realizable
Value at Assumed
Individual Grants Annual Rates of
% of Total Options/SARs Stock Price
Options/SARs Granted to Employees Exercise Expiration
Name Granted in Fiscal Year Price Date 5% 10%
E. Philip Saunders None None None N/A N/A N/A
John M. Holahan None None None N/A N/A N/A
William Burslem III None None None N/A N/A N/A
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND APRIL 30, 1995 OPTION/SAR VALUES
Value of
Number of Unexercised
Unexercised In-the-Money
Shares Acquired
Value Options/SARs Options/SARs
Name on Exercise Realized at April 30, 1995 at April 30, 1995
E. Philip Saunders None N/A None N/A
John M. Holahan None N/A 100,000 $63,000
William Burslem III None N/A 45,000 $47,000
Performance Chart
The following chart compares the five-year cumulative
total returns of Travel Ports of America, Inc. to the CRSP
Index for NASDAQ Stock Market (US Companies) and the CRSP
Index for NASDAQ Trucking & Transportation Stocks. Travel
Ports of America, Inc. does not have a peer group that
publishes information that could be used for a comparison.
The NASDAQ Trucking & Transportation Stock was used for our
peer comparison.
The chart shows the period from April 30, 1990 through
April 30, 1995. The index for Travel Ports of America, Inc.
goes from 100.0 in 1990 to 129.4 in 1995. The index for
Nasdaq Stock Market (US Companies) goes from 100.0 in 1990
to 214.4 in 1995. The index for Nasdaq Trucking &
Transportation Stocks goes from 100.0 in 1990 to 180.3 in
1995.
Report of the Board of Directors on Executive Compensation
There is no Compensation Committee as the total Board
acts on matters of compensation. The Board reviews annually
the compensation of the Officers. This review takes into
account the performance of the Company over the past year
and three year periods and a projection for future
performance over the next three years.
The CEO does not receive a salary from the Company. His
compensation is based upon a consulting agreement. This
agreement provides a monthly payment of $10,316.67 and a
bonus based upon the earnings of the Company. The bonus
section of the agreement ties a significant portion of his
compensation to the earnings of the Company.
The following are members of the Board: E. Philip
Saunders, John M. Holahan, William Burslem III, Dante
Gullace, William A. DeNight, John F. Kendall and John O.
Eldredge.
Incentive Stock Option Plans
On July 7, 1986, the Company adopted the Incentive
Stock Option Plan (the "ISO Plan") applicable to officers
and key employees of the Company. The ISO Plan authorizes
the issuance of options to purchase an aggregate of 180,000
shares of the Company's Common Stock. Options granted
pursuant to the ISO Plan are intended to constitute
incentive stock options under the Internal Revenue code of
1954, as amended. Under the ISO Plan, options may be granted
at not less than 100% (110% in the case of 10% shareholders)
of the fair market value of the Company's Common Stock on
the date of grant, and the value of the options exercised by
any one employee may not exceed $100,000 per year, plus
certain carryovers from prior years. Options may not be
granted more than ten years from the ISO Plan date. Options
granted under the ISO Plan must be exercised, if at all,
within ten years from the date of grant. The Shares of
Common Stock acquired through exercise of an option may not
be sold for at least two years from the date of the grant of
the option, or one year after the transfer of the shares to
the optionee, which ever is later. Further, the optionee
may not transfer any option except by will or by the laws of
descent and distribution. Options granted under the ISO Plan
must be exercised, if at all, within three months after
termination of employment for any reason other than death or
disability and within one year after termination of
employment due to death or disability. The Board of
Directors of the Company has the power to impose additional
limitations, conditions and restrictions in connection with
the grant of any option.
Through the date of this proxy statement, options are
outstanding as follows: Mr. Burslem -- 32,000 shares; all
executive officers as a group -- 32,000 shares; and all
other employees as a group -- 122,250. During the fiscal
year ended April 30, 1995, 23,000 options were granted,
9,876 options were exercised and 7,124 options were
terminated.
On October 29, 1991, the Company adopted the 1991
Incentive Stock Option Plan (the "1991 ISO Plan") applicable
to officers and key employees of the Company. The 1991 ISO
Plan authorizes the issuance of options to purchase an
aggregate of 100,000 shares of the Company's Common Stock.
Options granted pursuant to the 1991 ISO Plan are intended
to constitute incentive stock options under the Internal
Revenue code of 1986, as amended. Under the 1991 ISO Plan,
options may be granted at not less than 100% (110% in the
case of 10% shareholders) of the fair market value of the
Company's Common Stock on the date of grant, and the value
of the options exercised by any one employee may not exceed
$100,000 per year, plus certain carryovers from prior years.
Options may not be granted more than ten years from the 1991
ISO Plan date. Options granted under the 1991 ISO Plan must
be exercised, if at all, within ten years from the date of
grant. The Shares of Common Stock acquired through exercise
of an option may not be sold for at least two years from the
date of the grant of the option, or one year after the
transfer of the shares to the optionee, which ever is later.
Further, the optionee may not transfer any option except by
will or by the laws of descent and distribution. Options
granted under the 1991 ISO Plan must be exercised, if at
all, within three months after termination of employment for
any reason other than death or disability and within one
year after termination of employment due to death or
disability. The Board of Directors of the Company has the
power to impose additional limitations, conditions and
restrictions in connection with the grant of any option.
Through the date of this proxy statement, options are
outstanding as follows: Mr. Burslem -- 8,000 shares; all
executive officers as a group -- 8,000; and all other
employees as a group -- 74,998. During the fiscal year ended
April 30, 1995, 3,000 options were granted, 16,000 options
were exercised and 1,000 options were terminated.
On October 26, 1993, the Company adopted the 1993
Incentive Stock Option Plan (the "1993 ISO Plan") applicable
to officers and key employees of the Company. The 1993 ISO
Plan authorizes the issuance of options to purchase an
aggregate of 200,000 shares of the Company's Common Stock.
Options granted pursuant to the 1993 ISO Plan are intended
to constitute incentive stock options under the Internal
Revenue code of 1986, as amended. Under the 1993 ISO Plan,
options may be granted at not less than 100% (110% in the
case of 10% shareholders) of the fair market value of the
Company's Common Stock on the date of grant, and the value
of the options exercised by any one employee may not exceed
$100,000 per year, plus certain carryovers from prior years.
Options may not be granted more than ten years from the 1993
ISO Plan date. Options granted under the 1993 ISO Plan must
be exercised, if at all, within ten years from the date of
grant. The Shares of Common Stock acquired through exercise
of an option may not be sold for at least two years from the
date of the grant of the option, or one year after the
transfer of the shares to the optionee, which ever is later.
Further, the optionee may not transfer any option except by
will or by the laws of descent and distribution. Options
granted under the 1993 ISO Plan must be exercised, if at
all, within three months after termination of employment for
any reason other than death or disability and within one
year after termination of employment due to death or
disability. The Board of Directors of the Company has the
power to impose additional limitations, conditions and
restrictions in connection with the grant of any option.
Through the date of this proxy statement, options are
outstanding as follows: Mr. Burslem -- 5,000 shares, Mr.
Holahan -- 100,000 shares; all executive officers as a group
- -- 105,000; and all other employees as a group -- 80,490.
During the fiscal year ended April 30, 1995, 87,500 options
were granted, 10 options were exercised and 2,000 options
were terminated.
401(k) Plan
The Company maintains a tax-qualified, defined
contribution plan that meets the requirements of Section
401(k) of the Internal Revenue Code (The "401(k) Plan"). All
employees with one (1) year or more of service may elect to
have a portion of their salaries contributed on their behalf
to the 401(k) Plan. Although any amounts contributed to the
401(k) Plan for the benefits of the participants are
immediately and unconditionally vested, such contributions
are not currently taxable income to the participants and are
generally not available to them until termination of
employment. The amount ultimately received by a participant
or by a participant's beneficiary may be more or less than
the amount contributed by the participant to the 401(k)
Plan, depending upon the investment experience of the fund
chosen by the participant, and the amount of any Company
contributions made on behalf of the participant. Amounts
accrued for the Company's contributions for the 401(k) Plan
at April 30, 1994 for executive officers were $4,500.00 for
Mr. Holahan and $3,356.99 for Mr. Burslem.
PROPOSAL TO APPROVE THE 1995 EMPLOYEES INCENTIVE STOCK
OPTION PLAN
The Board of Directors has adopted, subject to approval
by the Shareholders, the 1995 Employee Stock Option Plan
(the 1995 ISO Plan) which provides for the granting to key
employees of the Company of options to purchase a maximum of
200,000 shares of common stock of the Company. Options
granted under the 1995 ISO Plan, which is identical to the
Companys existing ISO Plans, discussed above, will qualify
as incentive stock options under the Internal Revenue Code
of 1986, as amended (the Code).
The purpose of the 1995 ISO Plan is to provide
increased incentive to key employees and to encourage their
ownership of the Companys stock. The Board of Directors
believes that stock option plans are a useful factor in the
development of such employees. As of July 31, 1995, 20,314
options had been exercised, options to purchase 154,240
shares of the Companys Common Stock were outstanding, and
5,436 shares were available for the grant of options under
the original ISO Plan. As of July 31, 1995, 16,000 options
had been exercised, options to purchase 82,998 shares of the
Companys Common Stock were outstanding, and 1,002 shares
were available for the grant of options under the 1991 ISO
Plan. As of July 31, 1995, 10 options had been exercised,
options to purchase 185,490 shares of the Companys Common
Stock were outstanding, and 14,500 shares were available for
the grant of options under the 1993 ISO Plan. Accordingly,
the Board believes that additional shares should be
available for the grant of options under the 1995 ISO Plan.
The complete text of the 1995 ISO Plan is set forth in
Appendix A to this proxy statement. The following summary of
certain provisions of the 1995 ISO Plan is qualified by
reference to the text of the 1995 ISO Plan.
The 1995 ISO Plan authorizes the issuance of options to
purchase an aggregate of 200,000 shares of the Companys
Common Stock. Options granted pursuant to the 1995 ISO Plan
are intended to constitute incentive stock options under the
Code. Under the 1995 ISO Plan, options may be granted at not
less than 100% (110% in the case of 10% shareholders) of the
fair market value of the Companys Common Stock on the date
of grant, and the value of the options exercised by any one
employee may not exceed $100,000 per year, plus certain
carryovers from prior years. Options may not be granted more
than ten years from the date of adoption of the 1995 ISO
Plan. Options granted under the 1995 ISO Plan must be
exercised, if at all, within ten years from the date of
grant. Options are not exercisable more than five years
after date of grant for 10% shareholders. The Shares of
Common Stock acquired through the exercise of an option may
not be sold for at least two years from the date of the
grant of the option, or one year after the transfer of the
shares of the optionee. Further, the optionee may not
transfer any option except by will or by the laws of descent
and distribution. Options granted under the 1995 ISO Plan
must be exercised, if at all, within three months after
termination of employment for any reason other than death or
disability and within one year after termination of
employment due to death or disability. The Board of
Directors of the Company has the power to impose additional
limitations, conditions and restrictions in connection with
the grant of any option.
Federal Income Tax Consequences
An optionee does not realize income on the grant of an
incentive stock option. If an optionee exercises an
incentive stock option in accordance with the terms of the
option and does not dispose of the shares acquired within
two years from the date of grant of the option nor within
one year from the date of exercise, the optionee will not
realize any income by reason of the exercise and the Company
will not be allowed a deduction by reason of the grant or
exercise. The optionees basis in the shares acquired upon
the exercise will be the amount of cash paid upon exercise.
Provided the optionee holds the shares as a capital asset at
the time of sale or other disposition of the shares, the
gain or loss, if any, recognized on the sale or other
disposition will be capital gain or loss. The amount of gain
or loss will be the difference between the amount realized
on the disposition of the shares and the optionees basis
in the shares.
If an optionee disposes of the shares within two years
from the date of grant or within one year from the date of
exercise (an Early Disposition), the optionee will realize
ordinary income at the time of disposition which will equal
the excess, if any, of the lesser of (a) the amount realized
on the disposition, or (b) the fair market value of the
shares on the date of exercise, over the optionees basis in
the shares. The Company will be entitled to a deduction in
an amount equal to such income. The excess, if any, of the
amount realized on disposition of such shares over the fair
market value of the shares on the date of exercise will be
long- or short-term capital gain, depending upon the holding
period of the shares, provided the optionee holds the shares
as a capital asset at the time of disposition. If an
optionee disposes of such shares for less than his or her
basis in the shares, the difference between the amount
realized and such basis will be long- or short-term capital
loss, depending upon the holding period of the shares,
provided the optionee holds the shares as a capital asset at
the time of disposition.
The excess of the fair market value of the shares at
the time the incentive stock option is exercised over the
exercise price for the shares is a tax preference item (the
Incentive Stock Option Preference) unless the optionee
makes an Early Disposition of such stock. Section 55 of the
Code imposes an Alternative Minimum Tax equal to the excess,
if any, of (a) tentative minimum tax over (b) his or her
regular federal income tax. Tentative minimum tax is
computed on Alternative Minimum Taxable Income (AMTI).
AMTI is adjusted gross income adjusted for allowable
deductions, tax preferences and adjustments (including the
optionees Incentive Stock Option Preference amount). The
exemption amount is $33,750, less 25% of AMTI exceeding
$112,500 for single taxpayers, $45,000, less 25% of AMTI
exceeding $150,000 for married taxpayers filing jointly and
$22,500, less 25% of AMTI exceeding $75,000 for married
taxpayers filing separately.
The foregoing is a summary of the federal income tax
consequences to the participants in the 1995 ISO Plan and to
the Company, based upon current income tax laws, regulations
and rulings.
Vote Required For Approval of 1995 ISO Plan
The affirmative vote of the holders of a majority of
all outstanding shares of the Companys Common Stock is
required for approval of the 1995 ISO Plan.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
FOR APPROVAL OF THE 1995 ISO PLAN.
INDEPENDENT AUDITORS
The Board of Directors has selected the accounting firm
of Price Waterhouse to serve as independent auditors for the
Company for the fiscal year ending April 30, 1996. The firm
has served as independent accountants for the Company since
1986.
A representative of Price Waterhouse will be present at
the meeting with the opportunity to make a statement, and
will also be available to respond to appropriate questions
from shareholders.
OTHER MATTERS
The Board of Directors is not aware of any other
matters that may properly be presented for action at the
meeting. If any other matters should come before the meeting
requiring the vote of shareholders, the person named in the
enclosed proxy will have discretionary authority to vote
proxies in accordance with their judgment.
ADDITIONAL INFORMATION
A copy of the Annual Report, Form 10-K, filed with the
Securities and Exchange Commission, may be obtained by
writing the Company at its executive offices, 3495 Winton
Place, Building C, Rochester, New York 14623, Attention:
Secretary.
SHAREHOLDER PROPOSALS FOR NEXT YEAR'S ANNUAL MEETING
Shareholder proposals intended to be presented at the
1996 Annual Meeting must be submitted in writing to the
Corporate Secretary of the Company at its principal
executive offices located at 3495 Winton Place, Building C,
Rochester, New York 14623 by May 21, 1996.
SHAREHOLDERS ARE URGED TO COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE. PROMPT
RESPONSE WILL GREATLY FACILITATE ARRANGEMENTS FOR THE
MEETING AND YOUR COOPERATION WILL BE APPRECIATED.
By order of the Board of Directors
William Burslem III
Secretary
Rochester, New York
September 18, 1995
APPENDIX A
TRAVEL PORTS OF AMERICA, INC.
1995 EMPLOYEE'S INCENTIVE STOCK OPTION PLAN
1. Purpose. The Travel Ports of America, Inc. 1995
EMPLOYEE'S INCENTIVE STOCK OPTION PLAN (hereinafter referred
to as the "Plan") is designed to furnish additional
incentive to key employees of Travel Ports of America, Inc.,
a New York corporation (hereinafter referred to as the
"Company"), and its parents and subsidiaries, upon whose
judgment, initiative and efforts the successful conduct of
the business of the Company largely depends, by encouraging
such key employees to acquire a proprietary interest in the
Company or to increase the same, and to strengthen the
ability of the Company to attract and retain in its employ
persons of training, experience and ability, Such purpose
will be effected through the granting of stock options, as
herein provided, which will be "incentive stock options"
within the meaning of Section 422 of the Internal Revenue
Code of 1986 as the same has been and shall be amended
(hereinafter referred to as the "Code").
2. Eligibility. The persons who shall be eligible
to receive options under the Plan shall be those employees
of the Company, or of any of its parents or subsidiaries
within the meaning of Section 424(e) and (f) of the Code,
who are exempt from the overtime provisions of the Fair
Labor Standards Act of 1938, as amended, by reason of
employment in an executive, administrative or professional
capacity under 29 U.S.C. Section 213 (a)(1). No option shall
be granted to a person who would, at the time of the grant
of such option, own, or be deemed to own for purposes of
Section 422(b)(6) of the Code, more than 10% of the total
combined voting power of all classes of shares of stock of
the Company or its parents or subsidiaries unless at the
time of the grant of the option both the following
conditions are met:
(a) The option price is at least 110% of the fair
market value of the shares of stock subject to the option,
as defined in subparagraph 4(a) hereof, and
(b) The option is, by its terms, not exercisable
after the expiration of five years from the date the option
is granted.
3. Shares Subject to Options.
(a) Subject to the provisions of Section 4(f)
hereof, options may be granted under the Plan to purchase in
the aggregate not more than 200,000 of the $.01 par value
Common Stock of the Company or of its parents or
subsidiaries (hereinafter referred to as "Shares"), which
shares may, in the discretion of the Board of Directors of
the Company, consist either in whole or in part of
authorized but unissued Shares or Shares held in the
treasury of the Company. Any Shares subject to an option
which for any reason expires or is terminated unexercised as
to such Shares shall continue to be available for options
under the Plan.
(b) No options shall be granted hereunder to any
optionee that would allow the aggregate fair market value
(determined at the time the options are granted) of the
stock subject to all post 1986 incentive stock options,
including the incentive stock option in question, that such
optionee may exercise for the first time during any calendar
year, to exceed $100,000. The term "post 1986 incentive
stock option" shall mean all options that are intended to be
incentive stock options and are granted on or after January
1, 1987 under any stock option plan of the Company or any of
its parents or subsidiaries. If the Company shall ever be
deemed to have a "parent" as such term is used in Section
422 of the Code, then options intended to be incentive stock
options, granted after January 1, 1987, under such parent's
stock option plans, shall be included within the terms of
the definition of "post 1986 incentive stock options."
4. Terms and Conditions of Options. Options shall
be granted by the Board of Directors pursuant to the Plan
and shall be subject to the following terms and conditions:
(a) Price. Each option shall state the number
of Shares subject to the option and the option price, which
shall be not less than the fair market value of the Shares
with respect to which the option is granted at the item of
the granting of the option; provided, however, that the
option price shall be at least 110% of the fair market value
in the case of a grant of an option to a person who would at
the time of the grant , own, or be deemed to own for purpose
of Section 422(b)(6) of the Code, more than 10% of the total
combined voting power of all classes of Shares of the
Company or its parents or subsidiaries. For purposes of this
subsection, "fair market value" shall mean:
(1) the mean between the bid and asked price
for the Shares on the business
day immediately preceding the date of the grant of the
option, or
(ii) the most recent sale price for the
Shares as of the date if the grant of the
option, or
(iii) such price as shall be determined by
the Board of Directors of the
Company in an attempt made in good faith to meet the
requirements of Section
422(b)(4) of the Code.
(b) Term. The term of each option shall be
determined by the Board of Directors of the Company, but in
no event shall an option be exercisable either in whole or
in part after the expiration of ten years from the date on
which it is granted (or such shorter period as is specified
in Section 2(b) hereof). Notwithstanding the foregoing, the
Board of Directors and an optionee may, by mutual agreement,
terminate any option granted to such optionee under the
Plan.
(c) Non-Assignment During Life. During the
lifetime of the optionee, the option shall be exercisable
only by the optionee and shall not be assignable or
transferable by the optionee, whether voluntarily or by
operation of law or otherwise, and no other person shall
acquire any rights therein.
(d) Death of Optionee. In the event that an
optionee shall die prior to the complete exercise of options
granted to optionee under the Plan, such remaining options
may be exercised in whole or in part after the date of the
optionee's death only: (i) by the optionee's estate or by or
on behalf of such person or persons to whom the optionee's
rights under option pass under the optionee's Will or the
laws of descent and distribution, (ii) to the extent that
the optionee was entitled to exercise the option at the date
of optionee's death, (iii) prior to the expiration of the
term of the option, and (iv) within one (1) year after the
date of the optionee's death.
(e) Termination of Employment. An option shall
be exercisable during the lifetime of the optionee to whom
it is granted only if, at all times during the period
beginning on the date of the granting of the option and
ending on the day three months before the date of such
exercise, the optionee is an employee of the Company or its
parents or its subsidiaries issuing or assuming an option
granted hereunder in a transaction to which Section 424(a)
of the Code applies; provided, however, that in the case of
an optionee who is disabled , the three month period after
cessation of employment during which an option shall be
exercisable shall be one year. Notwithstanding the
foregoing, no option shall be exercisable after the
expiration of the term thereof. For the purposes of this
subsection, an employment relationship will be treated as
continuing intact while the optionee is on military duty,
sick leave or other bona fide leave of absence, such as
temporary employment by the Government, if the period of
such leave does not exceed 90 days, or, if longer, so long
as a statute or contract guarantees the optionee's right to
re-employment with the Company, or any of its parents or
subsidiaries, or another corporation issuing or assuming an
option granted hereunder in a transaction to which Section
424(a) of the Code applies. When the period of leave exceeds
90 days and the individual's right to re-employment is not
guaranteed either by statute or by contract, the employment
relationship will be deemed to have terminated on the 91st
day of such leave.
(f) Anti-Dilution Provisions. Subject to the
provisions of Section 422 of the Code and the regulations
promulgated thereunder, the aggregate number and kind of
Shares available for options under the Plan, and the number
and kind of Shares subject to, and the option price of, each
outstanding option shall be proportionately adjusted by the
Board of Directors of the Company for any increase, decrease
or change in the total outstanding Shares of the Company
resulting from a stock dividend, recapitalization, merger,
consolidation, split-up, combination, exchange of Shares or
similar transaction (but not by reason of the issuance or
purchase of Shares by the Company in consideration for
money, services or property.)
(g) Power to Establish Other Provisions.
Subject to the provisions of Section 422 of the Code and
regulations promulgated thereunder, options granted under
the Plan shall contain such other terms and conditions as
the Board of Directors of the Company shall deem advisable.
5. Exercise of Option. Options shall be exercised as
follows:
(a) Notice of Payment. Each option, or any
installment thereof, shall be exercised, whether in whole or
in part, by giving written notice to the Company at its
principal office, specifying the number of Shares purchased
and the purchase price being paid, and accompanied by the
payment of all or such part of the purchase price as shall
be specified in the option, by cash, certified or bank check
payable to the order of the Company. Each such notice shall
contain representations on behalf of the optionee that
acknowledges that the Company is selling the Shares being
acquired by the optionee under a claim of exemption from
registration under the Securities Act of 1933 as amended
(hereinafter referred to as the "Act"), as a transaction not
involving any public offering; that the optionee represents
and warrants that he is acquiring such Shares with a view to
"investment" and not with a view to distribution or resale;
and that the optionee agrees not to transfer, encumber or
dispose of the Shares unless: (i) a registration statement
with respect to the Shares shall be effective under the Act,
together with proof satisfactory to the Company that there
has been compliance with the applicable state law; or (ii)
the Company shall have received an opinion of counsel in
form and content satisfactory to the Company to the effect
that the transfer qualifies under Rule 144 or some other
disclosure exemption from registration and that no violation
of the act or applicable state laws will be involved in such
transfer, and/or such other documentation in connection
therewith as the Company's counsel may in its sole
discretion require.
(b) Issuance of Certificates. Certificates
representing the Shares purchased by the optionee shall be
issued as soon as practicable after the optionee has
complied with the provisions of Section 5(a) hereof.
(c) Rights as a Shareholder. The optionee shall
have no rights as a Shareholder with respect to the Shares
purchased until the date of the issuance to the optionee of
a Certificate representing such Shares.
(d) Disposition of Shares. Subject to the
provisions of Section 5(a) hereof, no disposition, within
the meaning of Section 424(c) of the Code, of Shares
acquired by the exercise of an option shall be made by an
optionee within two years from the date of the grant of the
option or within one year after the transfer of the Shares
to the optionee; provided, however, that the foregoing
holding periods shall not apply to the disposition of Shares
after the death of the optionee by the estate of the
optionee, or by a person who acquired the Shares by bequest
or inheritance or by reason of the death of the optionee.
For purposes of the preceding sentence, in the case of a
transfer of Shares by an insolvent optionee to a trustee,
receiver or similar fiduciary in any proceeding under Title
11 of the United States Code or any similar insolvency
proceeding, neither the assignment, nor any other transfer
of such Shares for the benefit of the optionee's creditors
in such proceeding shall constitute a disposition.
6. Term of Plan. Options may be granted pursuant to
the Plan from time to time within a period of ten years
after the date the Plan is adopted by the Board of Directors
of the Company or the date the Plan is approved by the
holders of a majority of the outstanding Shares of the
Company, whichever date is earlier. However, the Plan shall
not take effect until approved by the holders of a majority
of the outstanding Shares of the Company, at a duly
constituted meeting thereof, held within 12 months before or
after the date the Plan is adopted by the Board of Directors
of the Company.
7. Amendment and Termination of Plan. Subject to the
provisions of Section 422 of the Code and the regulations
promulgated thereunder, the Board of Directors of the
Company, without further approval by the Shareholders of the
Company, may at any time suspend or terminate the Plan, or
may amend it from time to time in any manner; provided,
however, that no amendment shall be effective without prior
approval of the Shareholders of the Company which would: (i)
except as provided in Section 4(f) hereof, increase the
maximum number of Shares for which options may be granted
under the Plan; or (ii) change the eligibility requirements
for individuals entitled to receive options under the Plan.
8. Administration. The Plan shall be administered by
the Board of Directors of the Company and decisions of the
Board of Directors concerning the interpretation and
construction of any provision of the Plan or of any option
granted pursuant to the Plan shall be final. The Company
shall effect the grant of options under the Plan in
accordance with the decisions of the Board of Directors of
the Company, which may, from time to time, adopt rules and
regulations for the carrying out of the Plan.
For purposes of the Plan, an option shall be deemed to be
granted when a written Incentive Option Contract is signed
on behalf of the Company by its duly authorized officer or
representative. Subject to the express provisions of the
Plan, the Board of Directors of the Company shall have the
authority, in its discretion and without limitation: (a) to
determine the individuals to receive options; the times when
such individuals shall receive options; the number of Shares
to be subject to each option; the term of each option; the
date each option shall become exercisable; whether an option
shall be exercisable in whole, in part, or installments; the
number of Shares to be subject to each installment; the date
each installment shall become exercisable; the term of each
installment; the option price of each option; the terms of
payment for Shares purchased by the exercise of each option;
(b) to accelerate the date of exercise of any installment;
and (c) to make all other determinations necessary or
advisable for administering the Plan.
9. Reservation of Shares. The Board of Directors of
the Company shall be under no obligation to reserve Shares
to fill options. Likewise, because of the substantial nature
of the conditions which must be met to entitle employees to
deliveries of reserved Shares, the Board of Directors of the
Company shall be under no obligation to reserve Shares
against such deliveries. The optioning and reservation of
Shares for employees hereunder shall not be construed to
constitute the establishment of a trust of the Shares so
optioned and reserved, and no particular Share shall be
identified as optioned and reserved for employees hereunder.
The Company shall be deemed to have complied with the terms
of the Plan if, at the time of the issuance and delivery
pursuant to option or reservation, or both, it has a
sufficient number of Shares authorized and unissued for the
purpose of the Plan, irrespective of the date when such
Shares were authorized.
10. Application of Proceeds. The proceeds of the sale
of Shares by the Company under the Plan will constitute
general funds of the Company and may be used by the Company
for any purpose
