<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.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[LOGO]
Dear Stockholder:
You are cordially invited to attend the 1999 Annual Meeting of Stockholders
of Marten Transport, Ltd. The meeting will be held on Tuesday, May 11, 1999, 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 AND PRESIDENT
April 2, 1999
<PAGE>
MARTEN TRANSPORT, LTD.
129 MARTEN STREET
MONDOVI, WISCONSIN 54755
---------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 11, 1999
------------------------
TO THE STOCKHOLDERS OF MARTEN TRANSPORT, LTD.:
The Annual Meeting of Stockholders of Marten Transport, Ltd. will be held on
Tuesday, May 11, 1999, 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 six 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 1999.
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 22, 1999 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, 1999
<PAGE>
MARTEN TRANSPORT, LTD.
129 MARTEN STREET
MONDOVI, WISCONSIN 54755
---------------------
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
MAY 11, 1999
------------------------
INTRODUCTION
The Annual Meeting of Stockholders of Marten Transport, Ltd. (the "Company")
will be held on May 11, 1999, 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, 1999.
VOTING OF SHARES
Only holders of Common Stock of record at the close of business on March 22,
1999 will be entitled to vote at the Annual Meeting. On March 22, 1999, we had
4,477,645 shares of Common Stock outstanding. For each share of Common Stock
that you own of record at the
1
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close of business on March 22, 1999, 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 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 six 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 stockholders. The Board of Directors has determined that there will be six
directors elected at the Annual Meeting.
The Board of Directors nominates the six 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, except Christine K. Marten, who was
appointed to the Board of Directors in September, 1998.
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The Board recommends a vote FOR the election of each of the nominees listed
below. The six 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.
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....... 46 Chairman of the Board and President of Marten 1980
Transport, Ltd.
Darrell D. Rubel......... 54 Executive Vice President, Chief Financial Officer, 1983
Treasurer and Assistant Secretary of Marten
Transport, Ltd.
Larry B. Hagness......... 49 President, Durand Builders Service, Inc., Durand, 1991
Wisconsin
Thomas J. Winkel......... 56 Management Consultant 1994
Jerry M. Bauer........... 47 President, Bauer Built, Incorporated, Durand, 1997
Wisconsin
Christine K. Marten...... 43 Flight Attendant, Northwest Airlines 1998
</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 since June 1986 and our
Chairman of the Board since August 1993. Mr. Marten also served as our Chief
Operating Officer from June 1986 until August 1998 and 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 August
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
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contractor, since 1978. Mr. Hagness has been an officer and owner 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.
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 has been a Director since January 1997. 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.
CHRISTINE K. MARTEN has been a Director since September 1998. Ms. Marten
has been a flight attendant with Northwest Airlines since 1978. Ms. Marten and
Randolph L. Marten are siblings.
ADDITIONAL INFORMATION ABOUT THE BOARD OF DIRECTORS
Our Board of Directors held six meetings during 1998. Each director attended
75% or more of the Board of Directors' meetings held during the period for which
he or she was a director during 1998.
The Board of Directors has formed an Audit Committee and a Compensation
Committee, both of which currently consist of three of our outside Board
Members--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 1998, the Audit
Committee met ten 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 1998, the Compensation Committee met three
times.
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<PAGE>
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 1998, Thomas J. Winkel and
Jerry M. Bauer each received $10,000, Larry B. Hagness received $9,500 and
Christine K. Marten received $1,000 in cash compensation for serving on the
Board. No other director received any cash compensation for services as a
director in 1998.
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.
5
<PAGE>
PRINCIPAL STOCKHOLDERS AND BENEFICIAL OWNERSHIP OF MANAGEMENT
The following table gives information on the beneficial ownership of our
Common Stock as of February 9, 1999, 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 of 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>
Randolph L. Marten
129 Marten Street
Mondovi, WI 54755 1,342,575(2)(3) 29.6%
Estate of Roger R. Marten
715 South Barstow Street
Eau Claire, WI 54702 1,320,000(2)(4) 29.5%
FMR Corp.
82 Devonshire Street
Boston, MA 02109 444,000(5) 9.9%
Heartland Advisors, Inc.
790 North Milwaukee Street
Milwaukee, WI 53202 398,975(6) 8.9%
Darrell D. Rubel 52,500(7) 1.2%
Robert G. Smith 38,250(8) *
Timothy P. Nash 24,000(9) *
Franklin J. Foster 24,000(10) *
Thomas J. Winkel 19,500(11) *
Larry B. Hagness 18,650(12) *
Jerry M. Bauer 13,750(13) *
Christine K. Marten 825 *
All Directors and Executive Officers 2,854,050(2)(3)(4)(14) 60.9%
as a Group (10 persons)
</TABLE>
- ------------------------
* Less than 1% of the outstanding shares
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(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) 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, as defined in Note (4) below, (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.
(3) Includes (a) 1,282,575 shares placed into the Marten Voting Trust (the
"Trust"), which is described in Note (4) below, by Randolph L. Marten and
(b) 60,000 shares that Mr. Marten may acquire under outstanding options.
(4) Includes 1,320,000 shares placed into the Trust by Roger R. Marten under
the terms of a Voting Trust Agreement dated February 14, 1983, as amended
(the "Voting Trust Agreement"). The Voting Trust 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.
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<PAGE>
(5) On February 12, 1999, FMR Corp. reported in a Schedule 13G filed with the
Securities and Exchange Commission that as of December 31, 1998, Fidelity
Management & Research Company ("Fidelity"), a wholly owned subsidiary of
FMR Corp., beneficially owned 444,000 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.
(6) On February 2, 1999, Heartland Advisors, Inc. ("Heartland") reported in a
Schedule 13G filed with the Securities and Exchange Commission that as of
December 31, 1998, it beneficially owned 398,975 shares. Heartland has sole
voting power for none 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.
(7) Does not include 2,602,500 shares placed into the Trust, of which
Randolph L. Marten, Darrell D. Rubel and G. Scott Nicastro are Trustees.
See Notes (2) and (4) above. Includes 30,000 shares that Mr. Rubel may
acquire under outstanding stock options.
(8) Includes 38,250 shares that Mr. Smith may acquire under outstanding
options.
(9) Includes 24,000 shares that Mr. Nash may acquire under outstanding options.
(10) Includes 24,000 shares that Mr. Foster may acquire under outstanding
options.
(11) Includes 18,750 shares that Mr. Winkel may acquire under outstanding
options.
(12) Includes 3,750 shares that Mr. Hagness may acquire under outstanding
options.
(13) Includes 13,750 shares that Mr. Bauer may acquire under outstanding
options.
(14) Includes a total of 212,500 shares that directors and executive officers
may acquire under outstanding options.
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<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 1998 $ 300,000 $ 150,000 $ -- $ 346
Chairman and President 1997 220,000 101,200 41,583 677
1996 220,000 -- 16,078 742
Darrell D. Rubel 1998 142,000 65,000 -- 71,903
Executive Vice President, 1997 130,000 -- 23,390 107,313
Chief Financial Officer and 1996 130,000 -- 16,078 78,299
Treasurer
Robert G. Smith 1998 132,692 66,346 -- 144
Chief Operating Officer 1997 105,000 55,650 -- 1,050
and Vice President of 1996 105,000 -- -- 1,050
Operations
Timothy P. Nash 1998 160,000 80,000 1,289 185
Vice President of Sales 1997 135,000 71,550 1,875 1,194
1996 135,000 -- -- 1,194
Franklin J. Foster 1998 120,000 60,000 607 138
Vice President of Finance 1997 104,596 55,650 -- 1,046
1996 90,000 -- -- 990
</TABLE>
- ------------------------
(1) All compensation in this column for Mr. Marten is the value of vacations
paid for on behalf of Mr. Marten in 1997 and 1996, 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 and 1996.
All compensation in this column for Mr. Nash in 1998 and 1997 and Mr. Foster
in 1998 are personal travel expenses reimbursed.
(2) The compensation for Mr. Rubel is the amount added to a deferred
compensation account in 1998, 1997 and 1996. See "Compensation and Other
Benefits--Employment Agreement." All other compensation in this column is
Marten's contribution to our 401(k) plan in 1998, 1997 and 1996.
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<PAGE>
OPTION GRANTS AND EXERCISES IN 1998
No options were granted to named executive officers in 1998. The following
table gives information for 1998 regarding our executive officers' options to
purchase shares of our Common Stock.
AGGREGATED OPTION/SAR EXERCISES IN 1998 AND
DECEMBER 31, 1998 OPTION/SAR VALUES
<TABLE>
<CAPTION>
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS/SARS IN-THE-MONEY OPTIONS/SARS
SHARES AT DECEMBER 31, 1998 (1)(#) AT DECEMBER 31, 1998 (2)($)
ACQUIRED ON ---------------------------- ----------------------------
NAME EXERCISE VALUE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------- ------------- -------------- ------------ -------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Randolph L. Marten -- -- 45,000 30,000 -- --
Darrell D. Rubel -- -- 22,500 15,000 -- --
Robert G. Smith -- -- 32,250 12,000 62,985 --
Timothy P. Nash -- -- 18,000 12,000 -- --
Franklin J. Foster -- -- 18,000 12,000 -- --
</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, 1998 of $13.25.
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
$192,000, after considering the January 27, 1999, amendment discussed below,
with $142,000 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
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<PAGE>
period after his employment terminates. The agreement also requires Mr. Rubel
to assign inventions to us and to keep our proprietary information
confidential. On January 27, 1999, we amended this agreement in recognition
of the services and benefits provided by Mr. Rubel. We agreed to pay to Mr.
Rubel an additional amount of $1,000 per month for the sixty-month period
beginning on January 1, 1998. Mr. Rubel is not required to remain a current
employee to receive this additional compensation.
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 is comprised of the following elements:
- Base salary compensation
- Annual incentive compensation
- Stock-based compensation
Effective for calendar year 1998, we adjusted the base salary for all of the
executive officers. 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;
11
<PAGE>
and (c) internal comparability. The comparable companies selected included
publicly traded long-haul truckload carriers. The committee believes that the
base salaries of its executive officers are on the moderate side of being
competitive in its industry. For the years 1994 through 1997, base salaries
had remained the same.
Base salaries for the executive officers for calendar 1999, excluding Mr.
Marten and Mr. Rubel, have been adjusted to reflect cost of living increases. In
addition, Mr. Smith's base salary was increased commensurate with his promotion
to Chief Operating Officer of the Company.
Prior to 1998, the Company's executive bonus program was tied to specific
operating performance objectives, including achieving specific operating margin,
return on assets, revenue growth and other individual and team objectives. In
1998, the executive bonus program was revised to provide for bonuses of up to
50% of annual base compensation if the Company achieves its targeted earnings
per share ("EPS"). If the Company's performance is no more than 4% below its
targeted EPS, each officer will accrue a bonus of 5% of annual base compensation
and if the performance is 105% or more of its targeted EPS, each officer will
accrue a bonus of 50% of annual base compensation. Bonuses are prorated for
Company performance falling between these achievement percentages. Bonuses are
paid in the calendar year following the year in which they are earned. For the
year ended December 31, 1998, the Company exceeded 105% of its targeted EPS and,
accordingly, each officer earned a bonus equal to 50% of base compensation.
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, 1993, 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 1993 1994 1995 1996 1997 1998
- ------------------------- ----- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Marten Transport 100 106.67 88.00 73.33 118.00 105.95
Trucking, Except Local 100 96.14 81.51 76.99 111.25 107.04
NASDAQ Market Index 100 104.99 136.18 169.23 207.00 291.96
</TABLE>
13
<PAGE>
CERTAIN TRANSACTIONS
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 1999, 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 stockholders for confirmation. The Board
recommends a vote FOR the confirmation of Arthur Andersen LLP as independent
auditors for 1999. 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%
14
<PAGE>
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 Messrs. Bauer, Hagness and Winkel each filed a Form 5
twenty-one days late.
PROPOSALS FOR THE NEXT ANNUAL MEETING
Stockholder proposals intended to be presented in our proxy materials for
the next Annual Meeting of Stockholders must be received by December 5, 1999 and
must satisfy the requirements of the proxy rules promulgated by the Securities
and Exchange Commission.
A stockholder who wishes to make a proposal at the next Annual Meeting
without including the proposal in our proxy statement must notify us by February
18, 2000. If a stockholder fails to give notice by this date, then the persons
named as proxies in the proxies we solicit for the next Annual Meeting will have
discretionary authority to vote on the proposal.
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 1998 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, 1998.
A COPY OF OUR 1998 ANNUAL REPORT ON FORM 10-K (EXCLUDING EXHIBITS) IS
AVAILABLE TO ANY STOCKHOLDER AS OF MARCH 22, 1999, 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 AND PRESIDENT
15
<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 22, 1999, at the Annual Meeting of Stockholders to be
held on May 11, 1999, and at any adjournments thereof.
- FOLD AND DETACH HERE -
<PAGE>
Please mark
your votes as /X/
indicated in
this example
1. ELECTION OF DIRECTORS
FOR AGAINST
all nominees all nominees
listed to the right listed to the right
(except as marked
to the contrary)
/ / / /
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A
LINE THROUGH THE NOMINEE'S NAME.)
RANDOLPH L. MARTEN DARRELL D. RUBEL LARRY B. HAGNESS
THOMAS J. WINKEL JERRY M. BAUER CHRISTINE K. MARTEN
2. PROPOSAL TO RATIFY THE SELECTION OF ARTHUR ANDERSEN LLP AS INDEPENDENT
AUDITORS OF THE COMPANY FOR THE FISCAL YEAR ENDING DECEMBER 31, 1999.
FOR AGAINST ABSTAIN
/ / / / / /
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
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.
Dated: , 1999
-------------------------
- ------------------------------------
Signature
- ------------------------------------
Signature if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
- FOLD AND DETACH HERE -
