SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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
/x/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
ROLLINS TRUCK LEASING CORP.
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/_/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or 14a-6(j)(2).
/_/ $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:*
_____________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_____________________________________________________________________________
/_/ 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 No. ______________________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
___________
*Set forth the amount on which the filing fee is calculated and state how it was
determined.
<PAGE>
ROLLINS TRUCK LEASING CORP.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 30, 1997
------------------------
TO THE HOLDERS OF COMMON STOCK:
PLEASE TAKE NOTICE that the 1997 Annual Meeting of Shareholders of ROLLINS
TRUCK LEASING CORP., a Delaware corporation, will be held on the First Floor,
1209 Orange Street, Wilmington, Delaware, on Thursday, January 30, 1997, at 9:00
A.M. (Eastern Standard Time) for the following purposes:
1. To elect two Class II Directors to the Board of Directors;
2. To consider and act upon such other business as may properly come
before the Annual Meeting or any adjournment thereof.
The Proxy Statement dated December 20, 1996 is attached.
The Board of Directors has fixed the close of business on December 13, 1996
as the record date for the determination of shareholders entitled to notice of
and to vote at the meeting.
You are cordially invited to attend the Annual Meeting. If you cannot be
present in person, please sign and date the enclosed proxy and promptly mail it
in the enclosed return envelope which requires no United States postage. Any
shareholder giving a proxy has the right to revoke it any time before it is
voted.
BY ORDER OF THE BOARD OF DIRECTORS
MICHAEL B. KINNARD, Secretary
Dated: Wilmington, Delaware
December 20, 1996
------------------------
YOU ARE REQUESTED TO DATE AND SIGN THE ENCLOSED PROXY AND RETURN
IT IN THE ENCLOSED ENVELOPE WHICH REQUIRES NO UNITED STATES POSTAGE.
<PAGE>
PROXY STATEMENT
ROLLINS TRUCK LEASING CORP.
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 30, 1997
------------------------
The information concerning the enclosed proxy and the matters to be acted
upon at the Annual Meeting of Shareholders to be held on January 30, 1997 (the
"Annual Meeting") is submitted to the shareholders for their information.
SOLICITATION OF AND POWER TO REVOKE PROXY
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of ROLLINS TRUCK LEASING CORP., a
Delaware corporation (the "Company"). Proxies solicited hereby are to be voted
at the Annual Meeting or at any adjournment thereof.
The mailing address for the Company's principal executive office is P. O.
Box 1791, Wilmington, Delaware 19899. This Proxy Statement and the form of proxy
were first sent to the Company's shareholders on December 20, 1996.
A form of proxy is enclosed. Each proxy submitted will be voted as directed
but, if not otherwise specified, proxies solicited by the Board of Directors of
the Company will be voted in favor of the candidates for election to the Board
of Directors as Class II Directors.
The solicitation of proxies will be by mail. It may be that further
solicitation of proxies will be made by telephone, telegram or interview with
some shareholders of the Company, following the original solicitation. All such
further solicitations will be made by regular officers and employees of the
Company, who will not be additionally compensated therefor, or its Transfer
Agent. The Company will bear the entire cost of all such solicitations, which
will be nominal and include reimbursements paid to brokerage firms and others
for their expenses in forwarding solicitation material regarding the meeting to
beneficial owners.
Each shareholder has the right to revoke his or her proxy at any time
before it is voted. A proxy may be revoked by filing with the Secretary of the
Company a written revocation or a duly executed proxy bearing a later date or by
voting in person at the Annual Meeting. Any shareholder may attend the Annual
Meeting and vote in person, whether or not such shareholder has previously given
a proxy.
CAPITAL STOCK
The outstanding capital stock of the Company on December 13, 1996 consisted
of 42,572,526 shares of Common Stock, par value $l.00 per share. Holders of
Common Stock are entitled to one vote (non-cumulative) for each share of such
stock registered in their respective names at the close of business on December
13, 1996, the record date for determining shares entitled to notice of and to
vote at the Annual Meeting or any adjournment thereof.
The holders of a majority of the issued and outstanding Common Stock
constitute a quorum at any meeting of shareholders and the affirmative vote of a
majority of the shares present is required for shareholder approval, except for
certain proposals to amend the Restated Certificate of Incorporation which
require the affirmative vote of the holders of a majority of all outstanding
Common Stock for
1
<PAGE>
approval. Other amendments to the Restated Certificate of Incorporation
concerning: (a) special meetings of shareholders; (b) amendments to the by-laws;
(c) provisions relating to the Board of Directors; and (d) certain business
transactions, when not approved by a majority of the Board of Directors, require
the affirmative vote of 75% of the shares then entitled to be voted for
approval.
As of October 31, 1996, only three persons were known to the Company to own
beneficially more than five percent (5%) of the outstanding shares of Common
Stock of the Company. The name and address of each such person, together with
the number of shares owned and the percentage of outstanding shares that
ownership represents and information as to Common Stock ownership of the Named
Executives identified in the Summary Compensation Table and the officers and
directors of the Company as a group (according to information received by the
Company) are set forth below:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
NUMBER OF SHARES
AND NATURE OF
TITLE OF BENEFICIAL PERCENT OF
CLASS NAMES AND ADDRESSES OF BENEFICIAL OWNERS OWNERSHIP(1) CLASS
- ----------- -------------------------------------------- --------------------- -------------
<S> <C> <C> <C>
Common John W. Rollins 4,781,485 11.2%
One Rollins Plaza
Wilmington, DE 19803
Common Neuberger and Berman 4,735,706(2) 11.1%
605 Third Avenue
New York, NY 10158
Common Strong/Corneliuson Capital 2,373,250 5.5%
Management, Inc.
100 Heritage Reserve
P.O. Box 2936
Milwaukee, WI 53201
Common Patrick J. Bagley 41,840 .1%
One Rollins Plaza
Wilmington, DE 19803
Common David F. Burr 169,386 .4%
One Rollins Plaza
Wilmington, DE 19803
Common John W. Rollins, Jr. 901,350 2.1%
One Rollins Plaza
Wilmington, DE 19803
Common Henry B. Tippie 1,500,000 3.5%
One Rollins Plaza
Wilmington, DE 19803
Common All Directors and Officers as a Group 7,402,498 17.3%
(8 persons)
</TABLE>
- ------------------
(1) As to officers and directors, owned directly and of record.
(2) Neuberger & Berman ("N&B") is a registered investment advisor. In its
capacity as investment advisor, N&B may have discretionary authority to
dispose of or to vote shares that are under its
2
<PAGE>
management. As a result, N&B may be deemed to have beneficial ownership of
such shares. N&B does not, however, have any economic interest in the
shares. N&B's clients are the actual owners of the shares and have the sole
right to receive and the power to direct the receipt of dividends from or
proceeds from the sale of such shares. As of October 31, 1996, of the shares
set forth above, N&B had shared dispositive power with respect to 4,735,706
shares, sole voting power with respect to 1,130,484 shares and shared voting
power with respect to 1,100,000 shares. With regard to the shared voting
power, Neuberger & Berman Management, Inc. and Neuberger & Berman Funds are
deemed to be beneficial owners for the purpose of Rule 13(d) since they have
shared power to make decisions whether to retain or dispose of the
securities. N&B is the sub-advisor to the above referenced Funds. It should
be further noted that the above mentioned shares are also included in the
shared power to dispose calculation.
ELECTION OF DIRECTORS
Two individuals are to be elected at the Annual Meeting to serve as Class
II Directors for a term of three years, and until the election and qualification
of their successors. Three other individuals serve as directors but are not
standing for re-election because their terms as directors extend past the Annual
Meeting pursuant to provisions of the Company's Restated Certificate of
Incorporation which provide for the election of directors for staggered terms,
with each director serving a three year term.
Unless a shareholder WITHHOLDS AUTHORITY, the proxy holders will vote FOR
the election of the persons named below to three-year terms as directors.
Although the Board of Directors does not contemplate the possibility, in the
event a nominee is not a candidate or is unable to serve as a director at the
time of the election, unless the shareholder WITHHOLDS AUTHORITY, the proxies
will be voted for a nominee designated by the present Board of Directors to fill
such vacancy.
3
<PAGE>
The name and age of each of the nominees, his principal occupation, the
period during which he has served as director, together with the number of
shares of Common Stock beneficially owned by him, directly or indirectly, and
the percentage of outstanding shares that ownership represents, all as of the
close of business October 31, 1996 (according to information received by the
Company), are set forth below. Similar information is also provided for those
directors whose terms expire in future years.
<TABLE>
<CAPTION>
SHARES OF PERCENT OF
NAMES OF PRINCIPAL SERVICE AS COMMON OUTSTANDING
NOMINEES OCCUPATION(1) DIRECTOR AGE STOCK(2) SHARES
- ---------------------------- -------------------------------------- --------------- ----------- ---------- ---------------
<S> <C> <C> <C> <C> <C>
Class II (Term Expires 2000)
William B. Philipbar, Jr. Retired; Former President and Chief 1993 to date 71 8,437 --
Executive Officer, Rollins
Environmental Services, Inc.*
John W. Rollins, Jr. President and Chief Operating Officer; 1967 to date 54 901,350(5) 2.1%
Senior Vice Chairman of the Board,
Rollins Environmental Services, Inc.*;
Chairman of the Board, Matlack
Systems, Inc.** (3)
</TABLE>
<TABLE>
<CAPTION>
SHARES OF PERCENT OF
NAMES OF DIRECTORS WHOSE PRINCIPAL SERVICE AS COMMON OUTSTANDING
TERMS HAVE NOT EXPIRED OCCUPATION(1) DIRECTOR AGE STOCK(2) SHARES
- ---------------------------- -------------------------------------- --------------- ----------- ---------- ---------------
<S> <C> <C> <C> <C> <C>
Class I (Term Expires 1999)
Gary W. Rollins President, Rollins, Inc. (Residential 1975 to date 52 -0-(4) --
and commercial services) (3)
Class III (Term Expires 1998)
John W. Rollins Chairman of the Board and Chief 1954 to date 80 4,781,485(6) 11.2%
Executive Officer; Chairman of the
Board and Chief Executive Officer,
Rollins Environmental Services, Inc.*;
Chairman of the Board, Dover Downs
Entertainment, Inc.***(3)
Henry B. Tippie Chairman of the Executive Committee 1974 to date 69 1,500,000(7) 3.5%
and Vice Chairman of the Board; 1954 to 1965
Chairman of the Executive Committee
and Director, Rollins Environmental
Services, Inc.*; Chairman of the
Executive Committee and Director,
Matlack Systems, Inc.**; Chairman of
the Board and Chief Executive Officer,
Tippie Services, Inc. (Management
Services); Vice Chairman of the Board,
Dover Downs Entertainment, Inc. ***
</TABLE>
4
<PAGE>
- ------------------
* Rollins Environmental Services, Inc. is engaged in the business of
industrial waste disposal.
** Matlack Systems, Inc. is engaged in the business of bulk trucking.
*** Dover Downs Entertainment, Inc. operates a multi-purpose gaming and
entertainment complex.
(1) The nominees and other directors have held the positions of responsibility
set out in the above column (but not necessarily their present titles) for
more than five years. In addition to the directorships listed in the above
column, the following individuals also serve on the board of directors of
the following companies: Gary W. Rollins, Rollins, Inc. and RPC Energy
Services, Inc.; John W. Rollins, Rollins, Inc., Matlack Systems, Inc., RPC
Energy Services, Inc. and FPA Corp.; John W. Rollins, Jr., Dover Downs
Entertainment, Inc.; Henry B. Tippie, Rollins, Inc. and RPC Energy Services,
Inc.; William B. Philipbar, Jr., Matlack Systems, Inc. and Rollins
Environmental Services, Inc.
(2) All shares are owned directly and of record.
(3) John W. Rollins is the uncle of Gary W. Rollins and the father of John W.
Rollins, Jr.
(4) Does not include 794,362* shares held as Co-Trustee, 84,186* shares held as
Trustee for his children and 71,634* shares representing a proportionate
interest of shares held by a general partnership.
(5) Does not include 458,612* shares held as Co-Trustee and 15,750* shares held
by his wife.
(6) Does not include 163,744* shares held by his wife and 90,026* shares held by
his wife as Custodian for his minor children.
(7) Does not include 1,117,074* shares held as Co-Trustee, 25,500* shares held
as Trustee, 21,000* shares owned by his wife and 21,000* shares held by his
wife as Trustee for his children, or 30,000* shares owned by a partnership
over which Mr. Tippie has sole voting power.
- ------------------
*The Messrs. Rollins and Tippie disclaim any beneficial interest in these
holdings.
BOARD OF DIRECTORS AND BOARD COMMITTEES
The Board of Directors held four regularly scheduled meetings and one
special meeting during fiscal year 1996. All members of the Board attended each
meeting.
Audit Committee. The Audit Committee consists of William B. Philipbar,
Jr., Chairman, and Gary W. Rollins. The Audit Committee held two meetings during
the last fiscal year. The Committee's functions include consulting with the
Company's independent public accountants concerning the scope and results of the
audit, reviewing the evaluation of internal accounting controls and inquiring
into special accounting-related matters.
Executive Committee. The Executive Committee consists of Henry B. Tippie,
Chairman, John W. Rollins and John W. Rollins, Jr. The Executive Committee held
two meetings during the last fiscal year. The Executive Committee has the power
to exercise all of the powers and authority of the Board of Directors in the
management of the business and affairs of the Company in accordance with the
provisions of the by-laws of the Company. The Executive Committee performs all
of the functions of a compensation committee of the Board of Directors.
Stock Option Committee. The Stock Option Committee consists of Henry B.
Tippie, Chairman, and John W. Rollins. The Stock Option Committee held two
meetings during the last fiscal year. The Stock Option Committee administers the
Company's outstanding Stock Option Plans including the granting of options to
various employees of the Company and its subsidiaries.
The Company does not have a nominating committee of the Board of Directors.
5
<PAGE>
DIRECTORS' COMPENSATION
Directors who are not full-time employees of the Company or any of its
subsidiaries are each paid an annual retainer for Board service of $10,000 and
an attendance fee of $750 for each Board of Directors or committee meeting
attended.
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 Proxy Statement, in whole or in part, the following report and
the Performance Graph on page 8 shall not be incorporated by reference into any
such filings.
REPORT OF THE EXECUTIVE AND STOCK OPTION COMMITTEES OF THE
BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
During fiscal year 1996, the members of the Executive Committee of the
Board of Directors held primary responsibility for determining executive
compensation levels.
The Company is engaged in a highly competitive industry. As a consequence,
the Company views its ability to attract and retain qualified executives as the
cornerstone of its future success. In order to accomplish this objective, the
Company has endeavored to structure its executive compensation in a fashion that
takes into account the Company's operating performance and the individual
performance of the executive. Of necessity, this analysis is subjective in
nature and not based upon a structured formula. The factors referred to above
are not weighted in an exact fashion.
Pursuant to the above compensation philosophy, the total annual
compensation of executive officers of the Company is made up of one or more of
three elements. The three elements are salary, an annual incentive compensation
package and, in some years, grants of stock options.
The salary of each executive officer is determined by the Executive
Committee. As previously stated, in making its determinations the Executive
Committee gives consideration to the Company's operating performance for the
prior fiscal year and the individual executive's performance.
The annual incentive compensation package for the non-Director Named
Executive who is an employee of a wholly-owned subsidiary is developed by the
Chief Operating Officer of the Company prior to the end of each fiscal year. It
is based upon a performance formula for the ensuing fiscal year. That
performance formula and incentive package is then reviewed by the Executive
Committee and is either accepted, amended or modified. The other non-Director
Named Executive's annual incentive compensation is on a similar basis. None of
the members of the Board of Directors participate in the incentive program.
Awards under the Company's Stock Option Plans are purely discretionary, are
not based upon any specific formula and may or may not be granted in any given
fiscal year. Grants are made under the Plans and the Plans are administered by
disinterested directors within the meaning of Rule 16b-3 of the Securities
Exchange Act of 1934. When considering the grant of stock options, the Stock
Option Committee gives consideration to the overall performance of the Company
and the performance of individual employees.
6
<PAGE>
CEO COMPENSATION
The CEO's compensation is determined by the Executive Committee. As is the
case with respect to the Named Executives, the CEO's compensation is based upon
the Company's operating performance and his individual performance. The decision
of the Executive Committee is, however, very subjective and is not based upon
any specific formula or guidelines. The CEO does not participate in the
deliberations of the Executive Committee when his salary is determined. Neither
the CEO nor any other member of the Executive Committee participates in any
Company incentive program. The CEO has never received a Stock Option from the
Company.
Executive Committee
Henry B. Tippie, Chairman
John W. Rollins
John W. Rollins, Jr.
Stock Option Committee
Henry B. Tippie, Chairman
John W. Rollins
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors and persons who own more than ten percent of a registered
class of the Company's equity securities to file reports of ownership and
changes in ownership with the Securities and Exchange Commission ("SEC").
Officers, directors and greater than ten percent shareholders are required by
SEC regulations to furnish the Company with copies of all Section 16(a) forms
they file.
Based on its review of the copies of such forms received by it, the Company
believes that during its fiscal year ended 1996 all filing requirements
applicable to its officers, directors and greater than ten percent beneficial
owners were complied with.
7
<PAGE>
COMMON STOCK PERFORMANCE
The following graph reflects a comparison of the cumulative total
shareholder return on the Company's common stock with the S&P Composite 500
Index, S&P Truckers Index and S&P Air Freight Index (formerly the S&P
Transportation (Miscellaneous) Index), respectively, for the five year period
commencing October 1, 1991 through September 30, 1996. Due to a change in the
S&P Index used by the Company formerly known as the S&P Transportation
(Miscellaneous) Index and now compiled as the S&P Air Freight Index, the S&P
Truckers Index has been added to this graph. The graph assumes that the value of
the investment in the Company's common stock and each index was 100 at September
30, 1991 and all dividends were reinvested. The comparisons in this table are
required by the Securities and Exchange Commission and, therefore, are not
intended to forecast or be necessarily indicative of any future return on the
Company's common stock.
IN PRINTED DOCUMENT CHART WAS INSERTED HERE.
THE PLOT POINTS FOLLOW.
<TABLE>
<CAPTION>
YEARS
----------------------------------------------------------------
1991 1992 1993 1994 1995 1996
--------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Rollins Truck Leasing Corp............................ 100 122 210 181 167 180
S&P 500............................................... 100 111 125 130 169 203
S&P Truckers.......................................... 100 111 110 111 104 80
S&P Air Freight....................................... 100 117 182 189 222 233
Assumes $100 invested on October 1, 1991
</TABLE>
8
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The following directors serve on the Company's Executive Committee: John W.
Rollins, John W. Rollins, Jr. and Henry B. Tippie. Each is an employee of the
Company, but none participate in the deliberations of the Executive Committee
with respect to his own compensation. Henry B. Tippie serves on the Compensation
Committees of Rollins, Inc. and RPC Energy Services, Inc. John W. Rollins, John
W. Rollins, Jr. and Henry B. Tippie are members of the Executive Committees of
Rollins Environmental Services, Inc. and Matlack Systems, Inc. The Executive
Committee of each of these two Companies performs the functions of a
Compensation Committee. Patrick J. Bagley serves as a director of Rollins
Environmental Services, Inc., Dover Downs Entertainment, Inc. and Matlack
Systems, Inc. John W. Rollins and Henry B. Tippie serve on the Compensation
Committee of Dover Downs Entertainment, Inc.
EXECUTIVE COMPENSATION
Shown below is information concerning the annual compensation for services
in all capacities to the Company for the fiscal years ended September 30, 1994,
1995 and 1996, of those persons who were, at September 30, 1996, (i) the
Chairman and Chief Executive Officer and (ii) the other most highly compensated
executive officers of the Company whose total annual salary exceeded $100,000
(the "Named Executives"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
-------------------------------------
AWARDS PAYOUTS
ANNUAL COMPENSATION ------------------------ -----------
------------------------------------- RESTRICTED STOCK
OTHER ANNUAL STOCK OPTIONS/ LTIP
NAME AND SALARY BONUS COMP. (2) AWARDS(3) SARs PAYOUTS
PRINCIPAL POSITION YEAR (1) $ $ $ $ # $
- -------------------------- ----------- --------- --------- --------------- ------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
John W. Rollins 1996 540,000 -0- -- -0- -0- -0-
Chairman of the 1995 580,000 -0- -- -0- -0- -0-
Board and CEO 1994 570,000 -0- -- -0- -0- -0-
Patrick J. Bagley 1996 231,250 35,000 -- -0- 12,000 -0-
Vice Pres.-Finance, 1995 215,000 45,000 -- -0- 9,000 -0-
Treasurer and CFO 1994 197,500 45,000 -- -0- -0- -0-
David F. Burr 1996 350,000 263,806 -- -0- 15,000 -0-
Chairman and 1995 344,231 186,367 -- -0- 12,000 -0-
CEO of Rollins 1994 325,000 349,247 -- -0- -0- -0-
Leasing Corp.
John W. Rollins, Jr. 1996 540,000 -0- -- -0- 15,000 -0-
President and COO 1995 580,000 -0- -- -0- 12,000 -0-
1994 570,000 -0- -- -0- -0- -0-
Henry B. Tippie 1996 540,000 -0- -- -0- -0- -0-
Chairman-Executive 1995 580,000 -0- -- -0- -0- -0-
Committee 1994 570,000 -0- -- -0- -0- -0-
<CAPTION>
ALL OTHER
NAME AND COMPENSATION
PRINCIPAL POSITION $
- -------------------------- ---------------
John W. Rollins -0-
Chairman of the -0-
Board and CEO -0-
Patrick J. Bagley -0-
Vice Pres.-Finance, -0-
Treasurer and CFO -0-
David F. Burr -0-
Chairman and -0-
CEO of Rollins -0-
Leasing Corp.
John W. Rollins, Jr. -0-
President and COO -0-
-0-
Henry B. Tippie -0-
Chairman-Executive -0-
Committee -0-
</TABLE>
- ------------------
(1) Fiscal years ending September 30.
(2) The only type of Other Annual Compensation for each of the named officers
was in the form of perquisites and was less than the level required for
reporting.
(3) No awards have ever been made.
9
<PAGE>
OPTION AND STOCK APPRECIATION RIGHTS GRANTS IN LAST FISCAL YEAR
The following table sets forth stock options granted in the fiscal year
ending September 30, 1996 to each of the Company's Named Executives. Employees
of the Company and its subsidiaries are eligible for stock option grants based
on individual performance. The Company did not issue any stock appreciation
rights. The table also sets forth the hypothetical gains that would exist for
the options at the end of their eight-year terms, assuming compound rates of
stock appreciation of 0%, 5% and 10%. The actual future value of the options
will depend on the market value of the Company's Common Stock. All option
exercise prices are based on the market price on the grant date.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS(1)
-------------------------------------------------- POTENTIAL REALIZABLE VALUE
% OF TOTAL AT ASSUMED ANNUAL RATES OF STOCK
OPTIONS PRICE APPRECIATION FOR
GRANTED TO OPTION TERM (2)
OPTIONS EMPLOYEES EXERCISE -----------------------------------------
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#) YEAR ($/SH) DATE 0% 5% 10%
- ---------------------------------- --------- ------------- ----------- ----------- -- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Patrick J. Bagley 12,000 2.5% $ 9.50 11/08/03 -- $ 54,430 $ 130,369
David F. Burr 15,000 3.1% $ 9.50 11/08/03 -- $ 68,037 $ 162,961
John W. Rollins, Jr. 15,000 3.1% $ 9.50 11/08/03 -- $ 68,037 $ 162,961
All employees as a group (3) 481,800 100.0% $ 9.50 11/08/03 -- $ 2,187,651 $ 5,239,810
to to
$10.50 04/10/04
Total potential stock price appreciation from November 9,
1995 to November 8, 2003 for all stockholders at assumed
rates of stock price appreciation (4) -- $ 194,259,004 $ 465,284,603
</TABLE>
- ------------------
(1) Options were granted on November 9, 1995 and on April 11, 1996.
(2) These amounts, based on assumed appreciation rates of 0% and the 5% and 10%
rates prescribed by the Securities and Exchange Commission rules, are not
intended to forecast possible future appreciation, if any, of the Company's
stock price. These numbers do not take into account certain provisions of
options providing for termination of the option following termination of
employment, nontransferability or phased-in vesting. The Company did not use
an alternative formula for a grant date valuation as it is not aware of any
formula which will determine with reasonable accuracy a present value based
on future unknown or volatile factors. Future compensation resulting from
option grants is based solely on the performance of the Company's stock
price.
(3) Based upon 477,000 options granted November 9, 1995 at an exercise price of
$9.50 and 4,800 options granted April 11, 1996 at an exercise price of
$10.50.
(4) Based upon a price of $9.50 on November 9, 1995 and a total of 42,827,735
shares of Common Stock outstanding on October 31, 1996.
10
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
The following table summarizes option exercises during fiscal year 1996 by
the Company's Named Executives, and the value of the options held by such
persons as of September 30, 1996. The Company has not granted and does not have
any Stock Appreciation Rights outstanding.
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
VALUE OPTIONS AT OPTIONS AT
SHARES ACQUIRED REALIZED FY-END (#) FY-END ($)
NAME (1) ON EXERCISE (#) ($)(2) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(3)
- ------------------------ ----------------- ------------- -------------------------- --------------------------
<S> <C> <C> <C> <C> <C> <C>
Patrick J. Bagley 9,372 $71,777 36,095 28,500 $210,803 $37,626
David F. Burr 9,747 $99,761 22,250 38,500 $ 81,752 $51,189
John W. Rollins, Jr. -0- -0- 29,100 15,900 $ 175 $26,075
</TABLE>
- ------------------
(1) John W. Rollins and Henry B. Tippie did not acquire or have any outstanding
Incentive Stock Options.
(2) Fair market value of underlying security at exercise date less the exercise
price.
(3) The value of the Company's common stock on September 30, 1996 was $11.25 per
share.
LONG-TERM INCENTIVE PLAN AWARDS IN LAST FISCAL YEAR
There were no Long-Term Incentive Plan Awards to the Named Executives
during fiscal year 1996.
DEFINED BENEFIT PLANS
The Company's Pension Plan is a non-contributory qualified defined benefit
plan. All full-time employees of the Company (except certain employees covered
by collective bargaining agreements) are eligible to participate in the Pension
Plan. Up to September 30, 1989, retirement benefits were equal to the sum of
from 1% to 1.8% of an employee's annual cash compensation for each year of
service to age 65. Commencing October 1, 1989 and thereafter, retirement
benefits are equal to the sum of 1.35% of earnings up to covered compensation,
as that term is defined in the Plan, and 1.7% of earnings above covered
compensation. Covered compensation includes regular salaries or wages,
commissions, bonuses, overtime earnings and short-term disability income
protection benefits.
Retirement benefits are not subject to any reduction for Social Security
benefits or other offset amounts. An employee's benefits may be paid in certain
alternative forms having actuarially equivalent values. Retirement benefits are
fully vested at the completion of five years of credited service or, if earlier,
upon reaching age 55. The maximum annual benefit under a qualified pension plan
is currently $120,000 beginning at the Social Security retirement age (currently
age 65).
The Company maintains a non-qualified, defined benefit plan, called the
Excess Benefit Plan, which covers those participants of the Pension Plan whose
benefits are limited by the Internal Revenue Code. A participant in the Excess
Benefit Plan is entitled to a benefit equaling the difference between the amount
of the benefit payable without limitation and the amount of the benefit payable
under the Pension Plan.
11
<PAGE>
Annual pension benefit projections for the Named Executives assume: (a)
that the participant remains in the service of the Company until age 65; (b)
that the participant's earnings continue at the same rate as paid in the fiscal
year ended September 30, 1996 during the remainder of his service until age 65;
and (c) that the Plans continue without substantial modification.
The estimated annual benefit at retirement for each of the following Named
Executives of the Company is: Patrick J. Bagley, $100,439; David F. Burr,
$168,206; John W. Rollins, Jr., $234,496; and Henry B. Tippie, $138,795. The
annual benefit for John W. Rollins ($53,949) is the amount of retirement income
which he was required by Federal law to commence receiving as of April 1, 1988.
AUDITORS
The Board of Directors has not selected or recommended the name of an
independent public accounting firm for approval or ratification by the
shareholders. The Board of Directors believes that it will be in the best
interests of the shareholders if it is free to make such determination based
upon all factors that are then relevant.
KPMG Peat Marwick LLP served as the Company's auditors for the fiscal year
ended September 30, 1996. A representative of KPMG Peat Marwick LLP will be
present at the Annual Meeting and will have the opportunity to make a statement
should such representative so desire. Such representative also will be available
to answer questions raised orally.
During the fiscal year ended September 30, 1996, KPMG Peat Marwick LLP's
services rendered to the Company consisted of auditing the Company's financial
statements. In this connection, KPMG Peat Marwick LLP performed such tests of
the Company's accounting records and other auditing procedures as were required
by generally accepted auditing standards.
SHAREHOLDER PROPOSALS
Appropriate proposals of eligible shareholders (an eligible shareholder
must be a record or beneficial owner of at least l% or $l,000 in market value of
securities entitled to be voted at the meeting and have held such securities for
at least one year) intended to be presented at the Company's next Annual Meeting
of Shareholders must be received by the Company no later than August 22, 1997
for inclusion in the Proxy Statement and form of proxy relating to that meeting.
12
<PAGE>
MISCELLANEOUS
ON WRITTEN REQUEST OF ANY RECORD OR BENEFICIAL SHAREHOLDER OF THE COMPANY,
THE COMPANY WILL PROVIDE, FREE OF CHARGE, A COPY OF THE COMPANY'S ANNUAL REPORT
ON FORM 10-K FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1996, WHICH INCLUDES THE
FINANCIAL STATEMENTS AND SCHEDULES THERETO. REQUESTS FOR A COPY OF FORM 10-K
SHOULD BE MADE IN WRITING AND ADDRESSED TO:
PATRICK J. BAGLEY
VICE PRESIDENT - FINANCE AND TREASURER
ROLLINS TRUCK LEASING CORP.
P. O. BOX 1791
WILMINGTON, DELAWARE 19899
THE COMPANY WILL CHARGE REASONABLE OUT-OF-POCKET EXPENSES FOR THE
REPRODUCTION OF EXHIBITS TO FORM 10-K SHOULD A SHAREHOLDER REQUEST COPIES OF
SUCH EXHIBITS.
The Company's Annual Report for the fiscal year ended September 30, 1996
has been mailed to shareholders under separate cover.
The Board of Directors knows of no business other than the matters set
forth herein which will be presented at the meeting. Inasmuch as matters not
known at this time may come before the meeting, the enclosed proxy confers
discretionary authority with respect to such matters as may properly come before
the meeting and it is the intention of the persons named in the proxy to vote in
accordance with their judgment on such matters.
BY ORDER OF THE BOARD OF DIRECTORS
MICHAEL B. KINNARD, Secretary
Wilmington, Delaware
December 20, 1996
13
ROLLINS TRUCK LEASING CORP.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR ANNUAL MEETING OF SHAREHOLDERS
Thursday, January 30, 1997, 9:00 A.M., E.S.T.
The undersigned hereby constitutes and appoints John W. Rollins and Michael
B. Kinnard, and each of them jointly and severally, proxies with full power of
substitution, to vote all shares of Common Stock which the undersigned is
entitled to vote at the Annual Meeting of Shareholders of the Company to be held
on January 30, 1997 at 9:00 A.M. Eastern Standard Time, First Floor, 1209 Orange
Street, Wilmington, Delaware, or at any adjournment thereof, on all matters set
forth in the Notice of Annual Meeting and Proxy Statement dated December 20,
1996, as follows:
(Mark only one box)
1. ELECTION OF DIRECTORS
Nominees: William B. Philipbar, Jr. and John W. Rollins, Jr.
|_| VOTE FOR all nominees listed above; except vote withheld from
following nominee (if any):
- -------------------------------------------------------------------------------
|_| VOTE WITHHELD FROM all nominees.
2. At their discretion, upon such matters as may properly come before
the Annual Meeting or any adjournment thereof.
(OVER)
<PAGE>
(CONTINUED FROM OTHER SIDE)
The undersigned acknowledges receipt of the aforesaid Notice of Annual
Meeting and Proxy Statement, each dated December 20, 1996, grants authority to
any of said proxies, or their substitutes, to act in the absence of others, with
all the powers which the undersigned would possess if personally present at such
meeting, and hereby ratifies and confirms all that said proxies, or their
substitutes, may lawfully do in the undersigned's name, place and stead.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF ROLLINS
TRUCK LEASING CORP. AND THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN
ACCORDANCE WITH YOUR INSTRUCTIONS. IF NO CHOICE IS SPECIFIED BY YOU, THIS PROXY
WILL BE VOTED FOR PROPOSAL 1.
Please sign below, date and return promptly.
Signature(s) of Shareholder(s)
DATED: January , 1997
Signature(s) should conform to name(s) and title(s) stenciled hereon.
Executors, administrators, trustees, guardians and attorneys should add their
title(s) on signing.
NO POSTAGE IS REQUIRED IF THIS PROXY IS RETURNED IN THE ENCLOSED ENVELOPE AND
MAILED IN THE UNITED STATES.
