<PAGE> 1
FORM 10-K/A
AMENDMENT NO. 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1994
OR
[ ] TRANSITION REPORT PURCHASE TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 0-15503
FREYMILLER TRUCKING, INC.
(Exact name of Registrant as specified in its charter)
INDIANA 62-1307586
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8621 NORTH ROCKWELL AVENUE 73132
OKLAHOMA CITY, OKLAHOMA (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code (405) 720-6555
Securities registered pursuant to Section 12(b) of the Act:
NONE
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, PAR VALUE $0.01 PER SHARE
--------------------
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of the Regulation S-K is not contained herein, and will not be
contained, to the best of Registrant's knowledge, in the definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [X]
At April 19, 1995, there were outstanding 2,425,000 shares of the
Registrant's Common Stock, $0.01 par value. The aggregate market value of
voting stock held by nonaffiliates of the Registrant was $2,721,600 as of April
19, 1995.
<PAGE> 2
FREYMILLER TRUCKING, INC.
FORM 10-K/A
AMENDMENT NO. 1
This Amendment No. 1 has been filed by Freymiller Trucking, Inc., an
Indiana corporation (the "Company"), for the purpose of amending the Company's
Annual Report on Form 10-K for the year ended December 31, 1994 to provide
information required by Part III of Form 10-K.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
DIRECTORS AND EXECUTIVE OFFICERS
On April 20, 1995, the Company filed with the United States Bankruptcy
Court for the Western District of Oklahoma a voluntary petition under Chapter
11 of the United States Bankruptcy Code. Management of the Company explored
many alternatives to improve the financial condition of the Company, but
finally concluded that the only realistic alternative to protect the going
concern value of the Company was to seek protection under the Bankruptcy Code.
Following discussions with the Board of Directors concerning the Company's
financial situation and the potential bankruptcy proceedings, four of the
Company's directors, Joe E. Davis, Anthony J. Klein, D. Linn Wiley and Roger B.
Collins, elected to resign from the Board. The Company's sole remaining
director is Don H. Freymiller. In connection with such resignations, the
Bylaws of the Company were amended to provide that the authorized number of
directors of the Company shall be one director until such time as the Bylaws
are further amended by the Board to increase this number.
The commencement of bankruptcy proceedings has not otherwise presently
affected the composition of the Company's senior management. Although changes
may occur in the composition of the Company's management team in the future,
the Company cannot determine at this time the precise nature of any such
changes. Each of the Company's executive officers is named below.
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Don H. Freymiller 56 Chairman of the Board of Directors,
President and Chief Executive Officer
J. Harold Fambro 48 Executive Vice President and Chief
Operating Officer
Richard E. Kuehn 39 Executive Vice President - Finance and
Chief Financial Officer
Kirk A. Williams 35 Executive Vice President - Marketing
and Sales
Dennis D. Freymiller 36 Vice President - National Accounts
David R. Freymiller 30 Vice President - Maintenance
Ronald E. Charlton 50 Vice President - National Accounts
</TABLE>
BIOGRAPHICAL INFORMATION
Don H. Freymiller. Mr. Freymiller has been Chairman of the Board of
Directors of the Company since its incorporation in 1971. He also served as
President of the Company from 1971 until June 1985, and as Chief Executive
Officer from June 1985 until November 1991. Mr. Freymiller was reappointed as
President and Chief Executive Officer of the Company in February 1995. Mr.
Freymiller founded the business in 1968 and operated it as a sole
proprietorship prior to its incorporation. Mr. Freymiller is currently a
member of the California Trucking Association and is past president of the
Interstate Truckload Carriers Conference, as well as a member of the Executive
Committee of the American Trucking Association.
2
<PAGE> 3
J. Harold Fambro. Mr. Fambro joined the Company in January 1995 as
Executive Vice President and Chief Operating Officer. Prior to joining the
Company, Mr. Fambro was a Managing Director of consumer products markets for
Southern Pacific Lines from May 1993 until January 1995. From February 1992
until May 1993, Mr. Fambro served as Executive Vice President of Dallas
Carriers Corp. Prior to February 1992, Mr. Fambro was employed by Burlington
Motor Carriers as Vice President - Marketing.
Richard E. Kuehn. Mr. Kuehn is a Certified Public Accountant and
served as Vice President - Finance and Chief Financial Officer of the Company
beginning in September 1989. In February 1995, Mr. Kuehn was promoted to
Executive Vice President - Finance and Chief Financial Officer. Prior to
joining the Company, Mr. Kuehn was Vice President and Chief Financial Officer
of DonCo Carriers, Inc. from September 1985 to September 1989. Mr. Kuehn was
with Arthur Andersen & Co. prior to joining DonCo Carriers, Inc.
Kirk A. Williams. Mr. Williams joined the Company in January 1995 as
Executive Vice President - Marketing and Sales. Prior to joining the Company,
Mr. Williams served as Vice President - Transportation of Exel Logistics North
America from November 1992 until January 1995. From January 1992 until
November 1992, Mr. Williams was President of Innovative Logistics, Inc. Prior
to January 1992, Mr. Williams was employed by Carolina Freight Carriers Corp.
as Director of Operations Planning.
Dennis D. Freymiller. Mr. Freymiller is the son of Don H. Freymiller,
has been a full-time employee of the Company since 1975 and became Vice
President - National Accounts in April 1994. He was Vice President -Operations
from August 1985 to March 1994 and Vice President - Maintenance from 1984 to
1985.
David R. Freymiller. Mr. Freymiller is the son of Don H. Freymiller,
has been a full-time employee of the Company since 1981 and became Vice
President - Maintenance in May 1989. He was Director of Maintenance from 1986
to 1989 and Parts Manager from 1983 to 1986.
Ronald E. Charlton. Mr. Charlton joined the Company in November 1992
and served until January 1995 as Vice President - Customer Resources. In
January 1995, Mr. Charlton was appointed as Vice President - National Accounts
of the Company. Prior to joining the Company, Mr. Charlton was Vice President
- - Operations of DonCo Carriers, Inc. from September 1990 to November 1992, and
Executive Vice President and Chief Executive Officer of Land Span, a trucking
company, from September 1988 until August 1990. Mr. Charlton was employed by
Altruk Freight Systems prior to 1988 as President and Chief Executive Officer.
3
<PAGE> 4
ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following sets forth certain summary compensation information
concerning the chief executive officer of the Company and each other executive
officer of the Company who received compensation during the year ended December
31, 1994 in excess of $100,000. Such individuals are hereinafter referred to
as the "named executive officers."
<TABLE>
<CAPTION>
Long Term
ANNUAL COMPENSATION Compensation
---------------------------- ------------
Awards
--------------
NAME AND PRINCIPAL FISCAL Stock All Other
POSITION YEAR Salary($) (1) Bonus($) (1) Options(#) Compensation($)(2)
------------------- ----- ------------- ------------ ---------- ------------------
<S> <C> <C> <C> <C> <C>
Don H. Freymiller, 1994 $250,000 - - $15,750
Chairman, President and 1993 250,000 - - 15,750
Chief Executive 1992 243,986 - - 2,661
Officer (3)
Jerry K. Stanners, 1994 225,750 - - 4,125
Former President and 1993 225,000 - - 2,913
Chief Executive 1992 225,000 $112,500 - -
Officer (4)
Ronald E. Charlton, 1994 110,000 - - 6,000
Vice President - 1993 94,769 18,000 10,000 6,000
National Accounts 1992 11,323 - 20,000 750
- --------------------
</TABLE>
(1) Amounts shown include cash and non-cash compensation earned and received by
the named executive officers as well as amounts earned but deferred at the
election of those officers.
(2) Includes matching contributions made by the Company under the Freymiller
Retirement Plan. The Retirement Plan is intended to qualify under Section
401(a) of the Internal Revenue Code of 1986, as amended (the "Code"), as a
profit sharing plan and with respect to its cash or deferred arrangement,
under Section 401(k) of the Code.
(3) Mr. Freymiller served as Chairman of the Board of Directors during the
periods indicated. Mr. Freymiller was appointed as President and Chief
Executive Officer of the Company in February 1995 following the resignation
of Jerry K. Stanners from such positions.
(4) Mr. Stanners resigned from his positions with the Company in February 1995.
OPTION GRANTS IN LAST FISCAL YEAR
No stock options were granted to the named executive officers during the
year ended December 31, 1994.
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<PAGE> 5
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUE
The following sets forth certain information concerning each exercise
of stock options during the year ended December 31, 1994 by each of the named
executive officers and the aggregated fiscal year-end value of the unexercised
options of each such named executive officer.
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS HELD AT IN-THE-MONEY OPTIONS AT
SHARES FISCAL YEAR END FISCAL YEAR END($)(1)
ACQUIRED VALUE -------------------------- -------------------------
ON REALIZED
NAME EXERCISE (1) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- ------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Don H. Freymiller - - - - - -
Jerry K. Stanners - - - 242,500(2) - -
Ronald E. Charlton - - 10,000 20,000 - -
</TABLE>
- --------------------
(1) Based on the market value of the Company's Common Stock as of December
31, 1994, the unexercised options had no value because the market
price of the Common Stock was below the exercise price of the options.
(2) These options were cancelled in February 1995 pursuant to the terms of
a separation agreement entered into between the Company and Mr.
Stanners in connection with the resignation of Mr. Stanners from his
positions with the Company. For more information, see "Executive
Compensation - Separation Agreement."
SEPARATION AGREEMENT
In connection with the resignation of Jerry K. Stanners as President
and Chief Executive Officer of the Company, Mr. Stanners entered into a
separation agreement with the Company effective as of February 1, 1995 (the
"Separation Agreement"). Pursuant to the Separation Agreement, the Company
paid to Mr. Stanners $258,000 as required under Mr. Stanner's employment
agreement with the Company. As a result of such payment, 64,500 shares of the
Company's Common Stock previously issued to Mr. Stanners and held in trust as
security for such payment were returned to the Company. The Company also
agreed to reimburse Mr. Stanners for relocation expenses and to extend at its
expense certain insurance benefits. Outstanding options to purchase 242,500
shares of Common Stock previously granted to Mr. Stanners were cancelled. In
addition, the Company retained Mr. Stanners to render consulting services to
the Company for a period of six months following the date of the Separation
Agreement pursuant to which Mr. Stanners receives a fee of $6,000 per month.
COMPENSATION OF DIRECTORS
Mr. Freymiller is not compensated for his services as a director. Joe
E. Davis, Anthony J. Klein and D. Linn Wiley, each a former director of the
Company, received flat fees during 1994 of $12,000, $12,000 and $15,000,
respectively, for their services as directors. Roger B. Collins, also a former
director of the Company, was not compensated for his services as a director.
However, a company wholly-owned by Mr. Collins is engaged as a consultant to
the Company and receives a specified monthly fee from the Company in connection
with such services. See "Certain Relationships and Related Transactions."
5
<PAGE> 6
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, that might incorporate future
filings, including this Amendment No. 1 to the Company's Form 10-K, the
following Compensation Report and Performance Graph shall not be deemed to be
incorporated by reference into any such filings.
COMPENSATION COMMITTEE REPORT
As a result of the resignation of four of the Company's five directors
as discussed elsewhere herein, the Compensation Committee (the "Committee")
currently consists solely of Don H. Freymiller, the Chairman of the Board of
Directors, President and Chief Executive Officer of the Company. During 1994
the Committee consisted of D. Linn Wiley, Joe E. Davis and Anthony J. Klein,
each former independent outside directors, as well as Mr. Freymiller. The
Committee is responsible for setting and administering the policies that govern
employee compensation. The Committee evaluates the performance of management
and determines compensation policies and levels. All decisions made by the
Committee during 1994 were reviewed by the full Board of Directors.
EXECUTIVE COMPENSATION PHILOSOPHY
The Company believes that compensation should reflect the value
created for shareholders, while supporting the business strategies and
long-range plans of the Company. Accordingly, the Company's executive
compensation program is based on guiding principles designed to align
compensation with the Company's business strategy and performance. These
principles are:
(i) to attract and retain key executives whose performance is
critical to the long-term success of the Company and who are
of the highest caliber;
(ii) to provide levels of compensation competitive with those
offered by the Company's competitors;
(iii) to motivate executives to enhance long-term shareholder value
by building appropriate ownership in the Company; and
(iv) to integrate the Company's compensation programs with its
annual and long-term strategic planning and measurement
processes.
EXECUTIVE COMPENSATION COMPONENTS
The Company's executive compensation is based on three principal
components, each of which is intended to serve the Company's overall
compensation philosophy.
Base Salary. Base Salary is intended to be set at a level competitive
with the amounts paid to executive officers of similar business structure, size
and marketplace orientation. Salaries for executive officers are reviewed by
the Committee on an annual basis.
Annual Bonuses. The Company awards bonuses to its key executives
based on three principal factors: (i) the Company's over-all performance; (ii)
business unit performance; and (iii) individual performance. By emphasizing
the Company's over-all performance as the most important aspect in determining
the amount of bonuses, the Company creates an important and explicit link
between executive compensation and the creation of shareholder value.
In January 1995, J. Harold Fambro and Kirk A. Williams joined the
Company as Executive Vice President and Chief Operating Officer and Executive
Vice President - Marketing and Sales, respectively. In connection with the
commencement of their employment, Messrs. Fambro and Williams entered into
five-year employment agreements with the Company. Under the terms of the
employment agreements, Messrs. Fambro and Williams will be eligible to receive
bonus payments equal to 1% of the Company's earnings before taxes and
extraordinary items and before deduction for bonus payments to officers of the
Company for each fiscal year during the term of the agreements. If the
preceding formula does not result in bonus payments for 1995 in excess of
$25,000, the employment agreements provide that Messrs. Fambro and Williams
will each receive additional bonus payments such that their respective bonuses
for 1995 will equal $25,000 each. Messrs. Fambro and Williams must be in the
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<PAGE> 7
employ of the Company at the end of each year in order to qualify for the bonus
payments for such year as described above.
Stock Options. Executive officers are eligible to receive periodic
grants of incentive stock options under the Company's 1987 Incentive Stock
Option Plan and nonqualified stock options under the Company 1987 Non-Statutory
Stock Option Plan (collectively, the "Plans"). The Plans are an integral part
of the Company's compensation system. The Plans are designed to encourage and
create ownership and retention of the Company's stock by key employees.
Through the Plans, long-range interests of key employees are aligned with
shareholders' interests as these employees build meaningful stakes in the
Company. Awards are typically granted at the fair market value of the
underlying Common Stock at the date of grant. Stock options generally vest in
installments over multiple years.
No stock options were granted to executive officers during 1994. In
January 1995 in connection with the commencement of their employment, the
Company granted to J. Harold Fambro and Kirk A. Williams, options to purchase
100,000 shares of Common Stock each at an exercise price of $2.50 per share,
the market price of the Common Stock on the date of grant. The ability of
Messrs. Fambro and Williams to exercise these options is subject to the
Company's achievement of specified earnings before taxes and extraordinary
items during the years 1995 through 1999.
CEO COMPENSATION
Jerry K. Stanners, the Company's former President and Chief Executive
Officer, resigned from his positions with the Company in February 1995. Prior
to his resignation, Mr. Stanners' compensation was based on the terms of his
employment agreement with the Company entered into effective October 14, 1991.
The agreement required Mr. Stanners to devote substantially his full business
time and attention and best efforts to the affairs of the Company during the
term of the agreement. The agreement provided for the payment of a base salary
at the initial rate of $225,000 per year, subject to upward adjustment by the
Board of Directors; the payment of an annual bonus in an amount equal to
one-half of the base salary during the first full year of his employment and
thereafter only if certain objectives established by the Board of Directors on
an annual basis were met; and various other benefits. The agreement also
provided for the payment of certain benefits upon termination of Mr. Stanners'
employment. For additional information concerning the terms of Mr. Stanners'
separation from the Company, see "Executive Compensation - Separation
Agreement."
Don H. Freymiller was appointed as President and Chief Executive
Officer of the Company following the resignation of Mr. Stanners from such
positions. As Chairman of the Board of Directors, Mr. Freymiller performed
many of the functions associated with the chief executive officer, and Mr.
Stanners performed significant operational and marketing duties which are now
being performed by Messrs. Fambro and Williams. Mr. Freymiller's base salary
for 1994 was reviewed by the Committee and was determined by the members of the
Board, exclusive of Mr. Freymiller. Mr. Freymiller's base salary during 1994
was $250,000, an amount believed by the Board of Directors to be comparable to
the amounts paid to senior executives with comparable qualifications,
experience and responsibilities at other companies of similar structure, size
and marketplace orientation. Mr. Freymiller did not receive a bonus during
1994. It is not anticipated that Mr. Freymiller's base salary will be
substantially increased as a result of his resumption of the full
responsibilities of President and Chief Executive Officer.
The executive compensation practices of the Company are periodically
re-evaluated to ensure their support of the strategic goals of the Company and
their contribution to the creation of shareholder value.
The foregoing report has been furnished by Don H. Freymiller,
currently the sole member of the Board of Directors of the Company:
Don H. Freymiller
April 25, 1995
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
All decisions of the Compensation Committee during 1994 were reviewed
by the full Board of Directors. During 1994, each of Messrs. Freymiller,
Stanners, Wiley, Davis and Klein served as directors of the Company and
reviewed decisions of the Compensation Committee.
Mr. Don H. Freymiller owns the building occupied by the Company's
corporate headquarters and in August 1994 entered into a seven-year lease
agreement with the Company pursuant to which the Company leases office space at
the rate of $15,000 per month. The Company made lease payments to Mr.
Freymiller totalling $75,000 during 1994.
Anthony J. Klein, a former director of the Company and member of the
Compensation Committee during 1994, is a partner in the law firm of Klein,
Wegis, DeNatale, Goldner & Muir which rendered legal services to the Company
during 1994 and is expected to provide legal services to the Company in
connection with various matters in the future.
See "Certain Relationships and Related Transactions" for information
concerning additional transactions between the Company and certain executive
officers and former directors.
STOCK PERFORMANCE INFORMATION
The following table compares from December 31, 1989 to December 31,
1994, the percentage change in the Company's cumulative total shareholder
return on its Common Stock with the cumulative total return of (i) the NASDAQ
National Market Composite Index and (ii) a group of peer companies engaged
principally in the transportation of temperature controlled products throughout
the United States. The peer group consists of KLLM Transport Services, Marten
Transport, Ltd. and Frozen Food Express Industries. The yearly percentage
change has been measured by dividing (i) the sum of (A) the cumulative amount
of dividends for the measurement period, assuming dividend reinvestment, and
(B) the difference between the price of the stock at the end and the beginning
of the measurement period; by (ii) the stock price at the beginning of the
measurement period. The historical stock performance shown in the table is not
intended to and may not be indicative of future stock performance.
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN
-----------------------
12/89 12/90 12/91 12/92 12/93 12/94
----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Freymiller Trucking, Inc. 100 84 68 80 60 26
Peer Group 100 92 164 357 451 417
NASDAQ Stock Market - US 100 85 136 159 181 177
</TABLE>
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of April 1, 1995
regarding the beneficial ownership of the Company's Common Stock by (i) each
person known by the Company, either from Company records or information
supplied by the persons named, to own beneficially more than 5% of the
Company's Common Stock, (ii) each director of the Company in office as of the
date hereof, (iii) each executive officer of the Company in office as of the
date hereof who received compensation during 1994 in excess of $100,000 and
(iv) all directors and executive officers as a group.
<TABLE>
<CAPTION>
Number of Shares
and Nature of
NAME AND ADDRESS OF Beneficial Percent
BENEFICIAL OWNER Ownership(1) of Class
----------------------- ------------------ -----------
<S> <C> <C>
Don H. Freymiller (2) 1,228,500 50.7%
8621 North Rockwell Avenue
Oklahoma City, OK 73132
Dimensional Fund Advisors Inc. (3) 161,300 6.7
1299 Ocean Avenue, Suite 650
Santa Monica, CA 90401
Ronald E. Charlton (4) 10,000 *
All Directors and Executive Officers as a Group 1,398,400 56.5
(7 persons)(5)
- -------------------------
</TABLE>
* Less than one percent
(1) Unless otherwise indicated, the individuals named in the table possess
sole voting and dispositive authority with respect to the shares listed
(except to the extent such authority is shared with spouses under
applicable law).
(2) Includes 1,214,500 shares held by the Freymiller Family Limited
Partnership (the "Partnership"). Mr. Freymiller is the sole general
partner of the Partnership and possesses sole voting and investment power
with respect to the shares owned by the Partnership.
(3) Information shown was furnished as of December 31, 1994 in Schedule 13G
filed by Dimensional Fund Advisors Inc. ("Dimensional") with the
Securities and Exchange Commission. As of that date, Dimensional was
deemed to beneficially own 161,300 shares of Common Stock. All of such
shares are held in portfolios of DFA Investment Dimensions Group Inc., a
registered open-end investment company, or in series of the DFA Investment
Trust Company, a Delaware business trust, or the DFA Group Trust and DFA
Participation Group Trust, investment vehicles for qualified employee
benefit plans, for all of which Dimensional Fund Advisors Inc. serves as
investment manager. Dimensional disclaims beneficial ownership of all
such shares. Of the shares deemed to be beneficially owned by
Dimensional, Dimensional exercises sole voting power with respect to
111,200 shares. Officers of Dimensional who also serve as officers of DFA
Investment Dimensions Group Inc. ("DFA Investment") and DFA Investment
Trust Company ("the Trust") exercise voting power, in their capacities as
officers of DFA Investment and the Trust, over an additional 44,100 shares
which are owned by DFA Investment and 6,000 shares which are owned by the
Trust.
(4) Consists of options to acquire 10,000 shares exercisable within 60 days of
April 1, 1995.
(5) Includes options to acquire 37,600 shares exercisable within 60 days of
April 1, 1995.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company leases revenue equipment owned by Mr. David Freymiller
consisting principally of four tractors, and in connection therewith made
lease payments to Mr. David Freymiller during the year ended December 31, 1994
in the amount of $46,000.
The Company has owner operator agreements relating to two tractors
with a general partnership in which Mr. Dennis Freymiller has a 50% interest
and made payments to the general partnership pursuant to such agreement
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<PAGE> 10
in the amount of $150,000 during the year ended December 31, 1994.
In September 1994, the Company entered into a consulting agreement
with RBC Ventures, Inc. ("RBCV") pursuant to which RBCV agreed to assist the
Company in attempting to obtain additional working capital and to provide
business counseling and other consulting services in connection with the
Company's operations. In January 1995, the Company closed the sale and
leaseback of a majority of its trailer fleet to Transport International Pool,
Inc. The Company was assisted in the negotiation of this transaction by RBCV,
and in connection with such services the Company paid to RBCV a fee of $100,000
in January 1995 as provided for in the consulting agreement. In addition, the
consulting agreement provides for the payment by the Company of consulting fees
to RBCV in the amount of $25,000 per month commencing in February 1995. The
consulting agreement will expire on September 23, 1997 and may be terminated by
the Company upon the occurrence of specified events. Roger B. Collins, a
former director of the Company, is the President and indirect beneficial owner
of 100% of the outstanding shares of RBCV.
In connection with the execution of the consulting agreement with RBCV
in September 1994, the Company granted to Mr. Collins nonqualified options to
purchase 195,500 shares of Common Stock of the Company at an exercise price of
$7.00 per share. The option may not be exercised until both of the following
conditions precedent are satisfied: (i) the Company must complete a financing
transaction meeting certain criteria; and (ii) the average of the highest bid
price of the Common Stock as reported on the National Association of Securities
Dealers, Inc. Automated Quotation System for each of any five consecutive
trading days must exceed $10.00 per share. The former condition was satisfied
by the sale and leaseback described above. As of the date hereof, the latter
condition had not been satisfied and, as a result, the options were not
exercisable as of such date. If not previously exercised, the options will
expire in September 2004. The Company has also granted certain registration
rights with respect to shares purchased upon exercise of the options.
Nonqualified options to purchase an additional 34,500 shares of the Company's
Common Stock were granted on identical terms to another officer of RBCV.
See "Executive Compensation - Compensation Committee Interlocks and
Insider Participation" for information concerning additional transactions
between the Company and certain directors.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
FREYMILLER TRUCKING, INC.
By: /s/ Richard E. Kuehn
Richard E. Kuehn,
Executive Vice President - Finance and
Chief Financial Officer
Date: April 28, 1995
11
