<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Marten Transport, LTD.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
[LOGO]
Dear Stockholder:
You are cordially invited to attend the 1998 Annual Meeting of Stockholders
of Marten Transport, Ltd. The meeting will be held on Tuesday, May 12, 1998, at
4:00 p.m. local time, at the Roger Marten Community Center, 120 S. Franklin
Street, Mondovi, Wisconsin.
We suggest that you carefully read the enclosed Notice of Annual Meeting and
Proxy Statement.
We hope you will attend the Annual Meeting. Whether or not you attend, we
urge you to complete, sign, date and return the enclosed proxy card in the
enclosed envelope in order to have your shares represented and voted at the
Annual Meeting.
Very truly yours,
/s/ Randolph L. Marten
Randolph L. Marten
CHAIRMAN OF THE BOARD, PRESIDENT
AND CHIEF OPERATING OFFICER
April 2, 1998
<PAGE>
MARTEN TRANSPORT, LTD.
129 MARTEN STREET
MONDOVI, WISCONSIN 54755
---------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 12, 1998
------------------------
TO THE STOCKHOLDERS OF MARTEN TRANSPORT, LTD.:
The Annual Meeting of Stockholders of Marten Transport, Ltd. will be held on
Tuesday, May 12, 1998, at 4:00 p.m. local time, at the Roger Marten Community
Center, 120 S. Franklin Street, Mondovi, Wisconsin, for the following purposes:
1.To elect five directors to serve for the next year or until their
successors are elected and qualified.
2.To consider and vote on a proposal to confirm the selection of Arthur
Andersen LLP as our independent auditors for 1998.
3.To transact other business if properly brought before the Annual Meeting
or any adjournment thereof.
Only stockholders of record as shown on the books of the Company at the
close of business on March 20, 1998 will be entitled to vote at the Annual
Meeting or any adjournment thereof.
By Order of the Board of Directors
/s/ Mark A. Kimball
Mark A. Kimball
SECRETARY
April 2, 1998
<PAGE>
MARTEN TRANSPORT, LTD.
129 MARTEN STREET
MONDOVI, WISCONSIN 54755
---------------------
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
MAY 12, 1998
------------------------
INTRODUCTION
The Annual Meeting of Stockholders of Marten Transport, Ltd. (the "Company")
will be held on May 12, 1998, at 4:00 p.m. local time, at the Roger Marten
Community Center, 120 S. Franklin Street, Mondovi, Wisconsin. See the Notice of
Meeting for the purposes of the meeting.
A proxy card is enclosed for your use. You are solicited on behalf of the
Board of Directors to MARK, SIGN, DATE AND RETURN THE PROXY CARD IN THE ENVELOPE
PROVIDED. Postage is not required if mailed in the United States. We will pay
the cost of soliciting proxies, including preparing, assembling and mailing the
proxies. We will also pay the cost of forwarding such material to the beneficial
owners of our common stock, par value $.01 per share (the "Common Stock"). Our
directors, officers and regular employees may, for no additional compensation,
solicit proxies by telephone, telegraph or personal conversation. We may
reimburse brokerage firms and others for the expenses of forwarding proxy
material to the beneficial owners of our Common Stock.
Any proxy given in accordance with this solicitation and received in time
for the Annual Meeting will be voted in accordance with the instructions given
in the proxy. Any shareholder giving a proxy may revoke it at any time before
its use at the Annual Meeting by giving written notice of revocation to our
Secretary. The revocation notice may be given before the Annual Meeting, or a
shareholder may appear at the Annual Meeting and give written notice of
revocation before use of the proxy.
We expect to mail this Proxy Statement, the Proxy and Notice of Meeting to
stockholders on April 2, 1998.
VOTING OF SHARES
Only holders of Common Stock of record at the close of business on March 20,
1998 will be entitled to vote at the Annual Meeting. On March 20, 1998, we had
4,477,645 shares of Common Stock outstanding. For each share of Common Stock
that you own of record at the close of business on March 20, 1998, you are
entitled to one vote on each matter voted on at the Annual Meeting. Holders of
shares of Common Stock lack cumulative voting rights.
Presence at the Annual Meeting, in person or by proxy, of the holders of a
majority of the outstanding shares of Common Stock (2,238,823 shares) is
required for a quorum to conduct business. In general, shares of Common Stock
represented by a properly signed and returned proxy card will count as shares
present at the Annual Meeting to determine a quorum. This is the case regardless
of whether the card reflects votes withheld from the election of director
nominees or abstentions (or is left blank) or
1
<PAGE>
reflects a "broker non-vote" on a matter. Cards reflecting broker non-votes are
those returned by a broker on behalf of its beneficial owner customer and not
voted on a particular matter, because voting instructions have not been received
and the broker has no discretionary authority to vote.
The five director nominees receiving the greatest number of votes cast for
the election of directors will be elected as directors. Therefore, votes
withheld from the election of director nominees will be excluded entirely from
the vote and will have no effect. Each of the other proposals described in this
Proxy Statement requires the approval of a majority of the shares voting in
person or by proxy on that proposal. Shares voted as abstaining on any of these
proposals will be treated as votes against the particular proposal. Shares
represented by a proxy card including any broker non-vote on a matter will not
be counted in determining whether that matter has been approved.
Shares of Common Stock represented by properly executed proxy cards will be
voted as directed on the proxy cards. Proxies signed by stockholders but lacking
any voting instructions will be voted in favor of the election of the director
nominees. Such proxies will also be voted in favor of the other proposals
described in this Proxy Statement. The proxies named on the proxy cards will use
their judgment to vote such proxies on any other business that may properly come
before the Annual Meeting.
ELECTION OF DIRECTORS
PROPOSAL 1
NOMINATION
Our Bylaws provide that the Board shall have at least one member, or a
different number of members as may be determined by the Board of Directors or
the shareholders. The Board of Directors has determined that there will be five
directors elected at the Annual Meeting.
The Board of Directors nominates the five persons listed below. If elected,
the individuals will serve until the next Annual Meeting of Stockholders or
until their successors are duly elected and qualified. All of the nominees are
members of the present Board of Directors. All of the nominees were elected at
last year's Annual Meeting of Stockholders.
The Board recommends a vote FOR the election of each of the nominees listed
below. The five nominees for election as directors at the Annual Meeting who
receive the greatest number of votes cast will be elected as directors. If,
before the Annual Meeting, the Board learns that any nominee will be unable to
serve because of death, incapacity or other unexpected occurrence, the proxies
that would have been voted for the nominee will be voted for a substitute
nominee selected by the Board. The proxies may also, at the Board's discretion,
be voted for the remaining nominees. The Board believes that all nominees will
be able to serve at the time of the Annual Meeting. No arrangements or
understandings exist between any nominee and any other person under which such
nominee was selected.
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<PAGE>
INFORMATION ABOUT NOMINEES
The following information has been furnished to the Company by the
respective nominees for director.
<TABLE>
<CAPTION>
NAMES OF NOMINEES AGE PRINCIPAL OCCUPATION DIRECTOR SINCE
- ------------------------- --- -------------------------------------------------- ----------------
<S> <C> <C> <C>
Randolph L. Marten 45 Chairman of the Board, President and Chief 1980
Operating Officer of Marten Transport, Ltd.
Darrell D. Rubel 53 Executive Vice President, Chief Financial Officer, 1983
Treasurer and Assistant Secretary of Marten
Transport, Ltd.
Larry B. Hagness 48 President, Durand Builders Service, Inc., Durand, 1991
Wisconsin
Thomas J. Winkel 55 Management Consultant 1994
Jerry M. Bauer 46 President, Bauer Built, Incorporated, Durand, 1997
Wisconsin
</TABLE>
OTHER INFORMATION ABOUT NOMINEES
RANDOLPH L. MARTEN has been a full-time employee since 1974. Mr. Marten has
been a Director since October 1980, our President and Chief Operating Officer
since June 1986 and our Chairman of the Board since August 1993. Mr. Marten
served as a Vice President from October 1980 to June 1986.
DARRELL D. RUBEL has been a Director since February 1983, our Chief
Financial Officer since January 1986, our Treasurer since June 1986, our
Executive Vice President since May 1993 and our Assistant Secretary since 1987.
Mr. Rubel also served as our Secretary from June 1986 until August 1987 and as a
Vice President from January 1986 until May 1993.
LARRY B. HAGNESS has been a Director since July 1991. Mr. Hagness has been
the President of Durand Builders Service, Inc., a retail lumber/home center
outlet and general contractor, since 1978. Mr. Hagness has been the President of
Main Street Graphics, a commercial printing company, since 1985.
THOMAS J. WINKEL has been a Director since April 1994. Since January 1994,
Mr. Winkel has been a management and financial consultant and private investor.
He also serves as interim President, Chief Executive Officer and Chief Financial
Officer of Advanced Bionics, Inc., a new medical device company. From 1990 to
1994, Mr. Winkel was the majority owner, Chairman of the Board, Chief Executive
Officer and President of Road Rescue, Inc., a manufacturer of emergency response
vehicles. From 1966 to 1990, Mr. Winkel served in various professional
capacities with Arthur Andersen & Co., the last six years as Managing Partner of
its St. Paul office. Mr. Winkel is also a director of Featherlite Mfg. Inc.
JERRY M. BAUER was elected as a Director by the Board of Directors on
January 30, 1997 to fill a vacancy on the Board of Directors. Mr. Bauer has been
the President of Bauer Built, Incorporated since 1976. Bauer Built is a
distributor of new and retreaded tires and related products and services
throughout the Midwest, and a distributor of petroleum products in West Central
Wisconsin. Mr. Bauer has also served on the Board of Directors of Security
National Bank, Durand, Wisconsin, since 1992.
ADDITIONAL INFORMATION ABOUT THE BOARD OF DIRECTORS
Our Board of Directors held six meetings during 1997. All of the directors
attended 75% or more of the meetings of the Board of Directors during 1997.
3
<PAGE>
The Board of Directors has formed an Audit Committee and a Compensation
Committee, both of which currently consist of our outside Board Members, who are
Mr. Hagness, Mr. Winkel and Mr. Bauer. The Board of Directors has not formed a
Nominating Committee.
The Audit Committee provides assistance to the Board to satisfy its
fiduciary responsibilities for our accounting, auditing, operating and reporting
practices. The committee recommends engagement of our independent public
accountants, reviews and approves services performed by such accountants,
including the results of the annual audit, reviews and evaluates the adequacy of
our system of internal controls and internal audit procedures, and performs
other related duties delegated to it by the Board. During 1997, the Audit
Committee met three times.
The Compensation Committee reviews general programs of compensation and
benefits for all of our employees. The committee makes recommendations to the
Board about matters such as compensation for our officers, directors and key
employees. The committee also serves as the disinterested administrator of our
1986 Incentive Stock Option Plan, our 1986 Non-Statutory Stock Option Plan and
our 1995 Stock Incentive Plan. During 1997, the Compensation Committee met four
times.
DIRECTOR COMPENSATION
We do not pay fees to directors who are our full-time employees, nor do we
reimburse them for out-of-pocket expenses of attending Board or committee
meetings. We generally pay directors who are not our full-time employees a fee
of $500 for each Board or committee meeting attended, and reimburse them for
out-of-pocket expenses of attending meetings. In 1997, Larry B. Hagness and
Thomas J. Winkel each received $7,000 and Jerry M. Bauer received $6,000 in cash
compensation for serving on the Board. No other director received any cash
compensation for services as a director in 1997.
Once elected to the Board, each non-employee director receives an option to
purchase 15,000 shares of Common Stock under our 1995 Stock Incentive Plan.
These options become exercisable in equal installments of one-third of the total
shares under the option on the first three anniversaries of the grant date, as
long as the director remains a Board Member. In addition, starting in 1998, each
non-employee director will receive an automatic grant of a non-qualified stock
option to purchase 3,750 shares of Common Stock upon re-election to the Board by
the shareholders. We issue these options at an exercise price equal to the fair
market value of one share of Common Stock on the grant date. These options
expire ten years from the grant date.
4
<PAGE>
PRINCIPAL STOCKHOLDERS AND BENEFICIAL OWNERSHIP OF MANAGEMENT
The following table gives information on the beneficial ownership of our
Common Stock as of February 2, 1998, unless otherwise indicated. The information
is given by (a) each stockholder who we know to beneficially own more than 5% of
our outstanding Common Stock, (b) each director, (c) each executive officer and
(d) all our directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES OF COMMON STOCK
BENEFICIALLY OWNED(1)
----------------------------------------
NAME AND ADDRESS PERCENT OF
OF BENEFICIAL OWNER AMOUNT CLASS
- ------------------------------------------ ------------------------- -------------
<S> <C> <C>
Estate of Roger R. Marten 1,320,000(2)(3) 29.5%
715 South Barstow Street
Eau Claire, WI 54702
Randolph L. Marten 1,327,575(3)(4) 29.4%
129 Marten Street
Mondovi, WI 54755
FMR Corp. 444,000(5) 9.9%
82 Devonshire Street
Boston, MA 02109
Heartland Advisors, Inc. 415,425(6) 9.3%
790 North Milwaukee Street
Milwaukee, WI 53202
Darrell D. Rubel 45,000(7) *
Robert G. Smith 27,750(8) *
Timothy P. Nash 18,000(9) *
Franklin J. Foster 18,000(10) *
Thomas J. Winkel 15,750(11) *
Larry B. Hagness 15,000 *
Jerry M. Bauer 5,000(12) *
All Directors and Executive Officers 2,792,075(2)(3)(4)(13) 60.3%
as a Group (9 persons)
</TABLE>
- ------------------------
* Less than 1% of the outstanding shares
(1) Unless otherwise noted, all of the shares are held by individuals having
sole voting and investment power for the shares shown. Shares not
outstanding, but considered beneficially owned because of the right of a
person or member of a group to purchase them within 60 days, are treated as
outstanding only when calculating the amount and percent owned by such
person or group.
(2) Includes (a) 880,000 shares placed into the Marten Voting Trust (the
"Trust") by Roger R. Marten under the terms of a Voting Trust Agreement
dated February 14, 1983, as amended (the "Voting Trust Agreement") and (b)
440,000 shares, also held in the Trust, issued under the three-for-two
split of our Common Stock, effective December 1997 (the "1997 Stock
Split"). The Voting Trust
5
<PAGE>
Agreement appointed Randolph L. Marten, Darrell D. Rubel and G. Scott
Nicastro as Trustees of the Trust. The Trustees vote all of the shares
under the Trust. The Trustees may vote on (a) an increase in our authorized
stock, (b) the sale, lease or exchange of all or substantially all of our
assets, (c) any consolidation or merger of Marten Transport, Ltd. with or
into another corporation and (d) our dissolution, only with the consent of
each beneficial owner of the shares to be voted. Other actions taken under
the Marten Voting Trust require an affirmative vote of a majority of the
Trustees. The Voting Trust Agreement expires on December 31, 2012, unless
terminated earlier by the Trustees or the beneficial owners of the Common
Stock held in the Trust. Effective May 4, 1993, Randolph L. Marten, as
subscriber, and Randolph L. Marten, Darrell D. Rubel and G. Scott Nicastro,
as trustees, entered into an Agreement Regarding Voting Trust Agreement.
This agreement becomes effective if the Voting Trust Agreement terminates.
This agreement covers all shares owned by Randolph L. Marten on May 4,
1993, and any shares he later acquires. This agreement has the same
provisions about the voting of shares as the Voting Trust Agreement and
also expires on December 31, 2012.
(3) Roger R. Marten and Randolph L. Marten (both as "Individual Stockholders"
and as "Voting Trustees"), Marten Transport, Ltd., and Darrell D. Rubel (as
a "Voting Trustee") entered into a Stock Restriction Agreement dated
September 19, 1986. Under this agreement, each of the Individual
Stockholders agreed to dispose of any shares of Common Stock or interest
under the Voting Trust Agreement (the "Shares") only with the written
consent of the other Individual Stockholder. If either Individual
Stockholder wishes to dispose of any of his Shares, he must give the other
Individual Stockholder and then Marten Transport, Ltd. a right of first
refusal to purchase the Shares. The Shares would be purchased at the lower
of the price offered or a price calculated under the Stock Restriction
Agreement. Upon the bankruptcy of an Individual Stockholder or any levy
against any of the Shares, the Individual Stockholder must also give this
right of first refusal to the other Individual Stockholder and Marten
Transport, Ltd.
(4) Includes (a) 855,050 shares placed into the Trust, which is described in
Note (2) above, by Randolph L. Marten, (b) 427,525 shares, also held in the
Trust, issued under the 1997 Stock Split and (c) 45,000 shares that Mr.
Marten may acquire under outstanding options.
(5) On February 10, 1998, FMR Corp. reported in a Schedule 13G filed with the
Securities and Exchange Commission that as of December 31, 1997, Fidelity
Management & Research Company ("Fidelity"), a wholly owned subsidiary of
FMR Corp., beneficially owned 296,000 shares. The shares were beneficially
owned through the Fidelity Low-Priced Stock Fund (the "Fund"). The Board of
Trustees of the Fund has sole voting power for all of the shares. The Fund,
FMR Corp. (through its control of Fidelity) and Edward C. Johnson 3rd
(Chairman of FMR Corp.) each has the sole power to dispose of the shares
owned by the Fund. Mr. Johnson, and various Johnson family members and
trusts for their benefit, may be considered, by their stock ownership and
the execution of a shareholder's voting agreement, to form a controlling
group of FMR Corp. Based on this filing, Fidelity beneficially owned
444,000 shares considering the 1997 Stock Split.
(6) On February 2, 1998, Heartland Advisors, Inc. ("Heartland") reported in a
Schedule 13G filed with the Securities and Exchange Commission that as of
December 31, 1997, it beneficially owned 276,950 shares. Heartland has sole
voting power for 250,000 of the shares and sole power to dispose of all of
the shares. According to their filing, the shares beneficially owned by
Heartland are held in investment advisory accounts of Heartland. The
interests of one investment advisory account, Heartland Value Fund, relates
to more than 5% of the class. Heartland Value Fund is a series of Heartland
Group, Inc., a registered investment company. Based on this filing,
Heartland beneficially owned 415,425 shares considering the 1997 Stock
Split.
6
<PAGE>
(7) Does not include (a) 1,735,000 shares placed into the Trust, of which
Randolph L. Marten, Darrell D. Rubel and G. Scott Nicastro are Trustees or
(b) 867,500 shares, also held in the Trust, issued under the 1997 Stock
Split. See Notes (2) and (3) above. Includes 22,500 shares that Mr. Rubel
may acquire under outstanding stock options.
(8) Includes 27,750 shares that Mr. Smith may acquire under outstanding
options.
(9) Includes 18,000 shares that Mr. Nash may acquire under outstanding options.
(10) Includes 18,000 shares that Mr. Foster may acquire under outstanding
options.
(11) Includes 15,000 shares that Mr. Winkel may acquire under outstanding
options.
(12) Includes 5,000 shares that Mr. Bauer may acquire under outstanding
options.
(13) Includes a total of 151,250 shares that directors and executive officers
may acquire under outstanding options.
7
<PAGE>
COMPENSATION AND OTHER BENEFITS
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table shows cash and non-cash compensation for each of the
last three years awarded to or earned by each of our executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
----------------------------------------------
OTHER ANNUAL ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1) COMPENSATION(2)
- --------------------------------- ---- ----------- -------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C>
Randolph L. Marten 1997 $ 220,000 $ 101,200(3) $ 41,583 $ 677
Chairman, President and Chief 1996 220,000 -- 16,078 742
Operating Officer 1995 220,000 -- 9,268 677
Darrell D. Rubel 1997 130,000 -- 23,390 107,313
Executive Vice President, 1996 130,000 -- 16,078 78,299
Chief Financial Officer and 1995 130,000 -- 9,268 51,719
Treasurer
Timothy P. Nash 1997 135,000 71,550(3) 1,875 1,194
Vice President of Sales 1996 135,000 -- -- 1,194
1995 135,000 13,500 -- 1,168
Robert G. Smith 1997 105,000 55,650(3) -- 1,050
Vice President of Operations 1996 105,000 -- -- 1,050
1995 105,000 10,500 -- 1,155
Franklin J. Foster 1997 104,596 55,650(3) -- 1,046
Vice President of Finance 1996 90,000 -- -- 990
1995 90,000 9,000(4) 380 727
</TABLE>
- ------------------------
(1) All compensation in this column for Mr. Marten is the value of vacations
paid for on behalf of Mr. Marten in 1997, 1996 and 1995, and personal travel
expenses reimbursed in 1997. All compensation in this column for Mr. Rubel
is the value of vacations paid for on behalf of Mr. Rubel in 1997, 1996 and
1995. All compensation in this column for Mr. Nash in 1997 and Mr. Foster in
1995 is personal travel expenses reimbursed.
(2) The compensation for Mr. Rubel is the amount added to a deferred
compensation account in 1997, 1996 and 1995. See "Compensation and Other
Benefits - Employment Agreement." All other compensation in this column is
our contribution to our 401(k) plan in 1997, 1996 and 1995.
(3) Earned in 1997, but paid in 1998.
(4) Earned in 1995, but paid in 1996.
OPTION GRANTS AND EXERCISES IN 1997
No options were granted to named executive officers in 1997. The following
table gives information for 1997 regarding our executive officers' options to
purchase shares of our Common Stock.
8
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN 1997 AND
DECEMBER 31, 1997 OPTION/SAR VALUES (REFLECTING THE 1997 STOCK SPLIT)
<TABLE>
<CAPTION>
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS/SARS IN-THE-MONEY OPTIONS/SARS
SHARES AT DECEMBER 31, 1997 (1) AT DECEMBER 31, 1997(2)
ACQUIRED ON ---------------------------- ----------------------------
NAME EXERCISE VALUE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------- ------------- -------------- ------------ -------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Randolph L. Marten -- $ -- 30,000 45,000 $ 32,500 $ 48,750
Darrell D. Rubel -- -- 15,000 22,500 16,250 24,375
Timothy P. Nash -- -- 12,000 18,000 13,000 19,500
Franklin J. Foster 15,000 154,000(3) 12,000 18,000 13,000 19,500
Robert G. Smith 8,250 52,625(4) 21,750 22,500 70,688 46,125
</TABLE>
- ------------------------
(1) The exercise price may be paid in cash or, at the Compensation Committee's
option, in shares of our Common Stock valued at fair market value on the
exercise date.
(2) Based on the closing sale price on December 31, 1997 of $14.75.
(3) Based on exercise price of $4.50 and sales on October 8, 1997 of 7,500
shares at $14.67, 1,500 shares at $15.00 and 6,000 shares at $14.83.
(4) Based on exercise price of $8.83 and sales of 1,500 shares at $12.50 on
September 18, 1997, 3,750 shares at $15.67 on October 16, 1997, and 3,000
shares at $16.00 on October 17, 1997.
EMPLOYMENT AGREEMENTS
On May 1, 1993, we entered into a ten-year Employment Agreement with Darrell
D. Rubel to employ Mr. Rubel as our Executive Vice President, Chief Financial
Officer and Treasurer. We entered into this Employment Agreement to retain the
long-term services of Mr. Rubel. This agreement also gave us stability due to
the failing health of Roger R. Marten, who was our Chief Executive Officer until
his death in August 1993. Mr. Rubel is paid annual cash compensation of
$180,000, with $130,000 currently paid in base salary and $50,000 added to a
deferred compensation account for Mr. Rubel. The Board of Directors may increase
but not decrease the base salary and the deferred compensation. The deferred
compensation is added to a special account for Mr. Rubel in equal amounts of
$25,000 on June 30 and December 31 of each year, as long as Mr. Rubel is a
current employee. Beginning January 1, 1998 and for each following year, Mr.
Rubel can direct a percentage of his compensation, less than or equal to 40%, to
be added to the deferred account. The balance in the deferred account vests at
an annual rate of 20% beginning on December 31, 1993. Mr. Rubel now has a fully
vested interest in all amounts in the deferred account. If we terminate the
agreement before it expires without "cause" and for other than the death or
disability of Mr. Rubel, or Mr. Rubel terminates the agreement for "good
reason," we must pay Mr. Rubel a lump sum amount. The amount is calculated as
(a) the present value of his current base salary for a five year period and (b)
the balance of the deferred account plus an amount equal to five times the
current annual amount that we would have added to the deferred account. The
agreement prevents Mr. Rubel from competing with us for a one year period after
his employment terminates. The agreement also requires Mr. Rubel to assign
inventions to us and to keep our proprietary information confidential.
9
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The functions of the Compensation Committee of the Board of Directors are
to:
-establish overall compensation policies that are consistent with our
strategic objectives;
-assess the performance of executive officers in developing and executing
our strategic objectives;
-ensure that executive compensation is appropriate in light of both
individual and our Company's performance; and
-make recommendations to the Board of Directors about the compensation of
our executive officers and other key employees.
The purposes of our executive compensation policy are to attract, motivate,
retain and reward executive officers and other key personnel. The objective is
for the personnel to consistently produce superior results over the long term to
provide value to our shareholders. Our overall executive compensation program is
designed to:
-provide a "team" approach where officers and key employees with differing
functional responsibilities work together to achieve our overall strategic
objectives;
-create a performance-based environment with variable compensation based
upon achieving annual and long-term business results;
-focus management on maximizing shareholder value through stock-based
compensation aligned to shareholder returns;
-provide compensation opportunities depending upon the Company's performance
relative to its competitors and changes in the Company's performance over
time; and
-ensure that our compensation program is competitive in our industry.
Consistent with these objectives, the Company's executive compensation
program was substantially revised in 1994 around three basic elements:
-Base salary compensation
-Annual incentive compensation
-Stock-based compensation
In 1994 we reviewed and modified the base salary for all of the executive
officers (other than Mr. Rubel, whose compensation was reviewed and established
as part of a long-term employment agreement described above). We considered the
following: (a) each executive's experience, level of responsibility and
performance; (b) salaries for comparable positions with similar companies in the
industry; and (c) internal comparability. The comparable companies selected
included publicly traded long-haul truckload carriers. This review resulted in
substantial increases in base salary for each of the executive officers from
1993 to 1994. Before this review, the committee believed that we were at the low
end of executive compensation among comparable companies. The committee now
believes that, particularly considering our revised performance-based bonus
program, our executive compensation is near the median among comparable
companies. The committee did take into account the performance of the comparable
companies to establish our executive compensation program. The increase in base
10
<PAGE>
salary for Mr. Randolph L. Marten in 1994 reflects, in addition to the
considerations above, superior performance in assuming the duties of chief
executive officer following the death of Roger R. Marten in 1993. Base salaries
have been maintained at 1994 levels for the years 1995 through 1997.
We substantially changed our executive bonus program in 1994, and modified
it again more modestly for 1996 and 1997. Bonus compensation was tied to: (a)
specific performance objectives, including achieving specific operating margin,
return on assets (formerly return on equity) and revenue growth objectives; (b)
overall executive team performance; and (c) individual performance objectives.
Under this program, executives may receive a bonus of up to 50% of base
compensation if the performance objectives are achieved. Bonuses may exceed 50%
if the performance objectives are exceeded. Each executive officer has the
opportunity to earn an additional discretionary bonus of up to 10% of annual
base compensation based on achieving certain individual performance objectives.
The individual performance objectives are primarily measurable and tied to our
strategic objectives. The executive bonus program is effective when we increase
our pre-tax earnings by at least 10% from the prior year.
The third element of our executive compensation program is stock-based
compensation, which further aligns executive compensation with maximizing
shareholder value. In the past, our executive officers have been granted, on the
date of their initial election as an executive officer, an option to purchase
22,500 shares of Common Stock. The exercise price is the fair market value on
the grant date. These options become exercisable for 20% of the shares under the
option on each of the first five anniversary dates of the grant date. With the
adoption of the 1995 Stock Incentive Plan, the committee intends to make greater
use of stock options. This will give a more meaningful opportunity for stock
ownership and greater incentive for our executives to manage from the
perspective of a shareholder. The size of option grants to each executive
officer will be discretionary, based on current levels of responsibility,
performance, and perceived future potential.
The committee believes that its approach to executive compensation will
provide competitive base compensation, establish strong incentive to achieve our
strategic objectives and align the executives' interests with those of the
shareholders.
Larry B. Hagness
Thomas J. Winkel
Jerry M. Bauer
Members of the Compensation Committee
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<PAGE>
COMPARATIVE STOCK PERFORMANCE
The graph below compares the cumulative total stockholder return on our
Common Stock with The Nasdaq Stock Market index and the SIC code 4213 (trucking,
except local) line-of-business index for the last five years. Media General
Financial Services prepared the line-of-business index. The graph assumes $100
is invested in our Common Stock, The Nasdaq Stock Market index and the
line-of-business index on December 31, 1992, with reinvestment of dividends.
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG MARTEN TRANSPORT, LTD., THE
NASDAQ STOCK MARKET INDEX AND SIC CODE INDEX
<TABLE>
<CAPTION>
COMPANY 1992 1993 1994 1995 1996 1997
- ------------------------- ----- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Marten Transport, Ltd. 100 170.46 181.82 150.00 125.00 201.14
Industry Index 100 113.27 108.90 92.32 87.21 126.02
Broad Market 100 119.95 125.94 163.35 202.99 248.30
</TABLE>
12
<PAGE>
CERTAIN TRANSACTIONS
We purchased an office and terminal facility in 1997 located in Ontario,
California for $1.5 million from R&R Properties, a sole proprietorship owned by
Randolph L. Marten. From 1985 through 1997, we leased this facility from R&R
Properties. We made rental payments to R&R Properties totaling $126,000 in 1997.
We maintain deposits in Chetek State Bank and Bank of Barron, which are
subsidiaries of BCB Bancorp, Inc. ("BCB"). On February 1, 1994, BCB became a
wholly owned subsidiary of Northwest Wisconsin Bancorp, Inc. ("NWB"), which is
solely owned by Darrell D. Rubel. Prior to February 1, 1994, Darrell D. Rubel
and the estate of Roger R. Marten each had owned 50% of the stock of BCB.
Darrell D. Rubel is a director of BCB and NWB.
Jerry M. Bauer is the President and a stockholder of Bauer Built,
Incorporated ("BBI"), which supplies us with new and retreaded tires, related
tire services, and petroleum products. Merchandise and services BBI supplies to
us are billed either directly or through national account programs. The terms on
which BBI supplies us and other companies with these products and services are
substantially similar. Other than any benefit received from holding stock in
BBI, Mr. Bauer receives no compensation or other benefits from our business with
BBI.
We believe that the above transactions are at rates and on terms which are
not more favorable than could have been obtained from unaffiliated third
parties.
SELECTION OF INDEPENDENT AUDITORS
PROPOSAL 2
The Board of Directors has approved the selection of Arthur Andersen LLP as
independent auditors to examine our accounts for 1998, and to perform other
appropriate accounting services. Arthur Andersen LLP has been our independent
auditors since July 1986.
Although not required to do so, the Board of Directors wishes to submit the
selection of Arthur Andersen LLP to the shareholders for confirmation. The Board
recommends a vote FOR the confirmation of Arthur Andersen LLP as independent
auditors for 1998. Unless a different choice is given, proxies received by the
Board will be voted FOR the confirmation of Arthur Andersen LLP. If the
selection of Arthur Andersen LLP is not confirmed, the Board of Directors will
reconsider its selection.
We have requested and expect a representative of Arthur Andersen LLP to
attend the Annual Meeting to make a statement and to answer any questions.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
our directors and executive officers, and persons who beneficially own more than
10% of our Common Stock, to file with the Securities and Exchange Commission
(the "SEC") initial reports of ownership and reports of changes in ownership of
our Common Stock. Directors, executive officers and greater than 10%
stockholders are required by SEC regulations to give us copies of all Section
16(a) reports they file. To our knowledge, our directors, executive officers and
greater than 10% stockholders complied with all applicable Section 16(a) filing
requirements, except that Mr. Smith filed one Form 4, for one transaction, five
days late.
13
<PAGE>
PROPOSALS FOR THE NEXT ANNUAL MEETING
Stockholder proposals intended to be presented in the proxy materials for
the next Annual Meeting of Stockholders must be received by December 4, 1998.
OTHER BUSINESS
This Proxy Statement contains all business we are aware of that will be
presented at the Annual Meeting. The person or persons voting the proxies will
use their judgment to vote for proxies received by the Board for other business,
if any, that may properly come before the Annual Meeting.
ANNUAL REPORT
A copy of our 1997 Annual Report to Stockholders has been sent with this
Notice of Annual Meeting and Proxy Statement. The Annual Report describes our
financial condition as of December 31, 1997.
A COPY OF OUR 1997 ANNUAL REPORT ON FORM 10-K (EXCLUDING EXHIBITS) IS
AVAILABLE TO ANY STOCKHOLDER AS OF MARCH 20, 1998, BY WRITING TO: MARTEN
TRANSPORT, LTD., 129 MARTEN STREET, MONDOVI, WISCONSIN 54755, ATTENTION: DARRELL
D. RUBEL, EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER.
/s/ Randolph L. Marten
Randolph L. Marten
CHAIRMAN OF THE BOARD,
PRESIDENT AND CHIEF OPERATING OFFICER
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<PAGE>
Marten Transport, Ltd.
This Proxy is solicited by the Board of Directors
The undersigned hereby appoints RANDOLPH L. MARTEN and DARRELL D. RUBEL,
and each of them, as Proxies, each with full power of substitution, and hereby
authorizes each of them to represent and to vote, as designated on the reverse
side, all the shares of Common Stock of Marten Transport, Ltd. held of record
by the undersigned on March 20, 1998, at the Annual Meeting of
Stockholders to be held on May 12, 1998, and at any adjournments thereof.
--FOLD AND DETACH HERE--
<PAGE>
1. ELECTION OF DIRECTORS
<TABLE>
<S> <C> <C>
FOR AGAINST (INSTRUCTION: To withhold authority to vote for any individual nominee,
all nominees all nominees strike a line through the nominee's name.)
listed to the right listed to the right
(except as marked RANDOLPH L. MARTEN DARRELL D. RUBEL LARRY B. HAGNESS
to the contrary) THOMAS J. WINKEL JERRY M. BAUER
2. PROPOSAL TO RATIFY THE SELECTION OF ARTHUR ANDERSEN LLP AS INDEPENDENT 3. In their discretion, the Proxies are authorized
AUDITORS OF THE COMPANY FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998. to vote upon such other business as may properly
come before the meeting.
FOR AGAINST ABSTAIN
This proxy, when properly executed, will be
voted in the manner directed herein by the
undersigned shareholder. If no direction is
made, this proxy will be voted for Proposal 2
and for all nominees named in Proposal 1
above. Please sign exactly as name appears
below. When shares are held by joint tenants,
both should sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full corporate
name by President or other authorized officer.
If a partnership, please sign in partnership
name by authorized person.
Date:__________________________________, 1998
____________________________________________
Signature
____________________________________________
Signature if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.\
--FOLD AND DETACH HERE--
</TABLE>
