<PAGE>
UNITED STATES
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 [_]
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
METROTRANS CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[_] No fee required
[_] 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 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
<PAGE>
METROTRANS CORPORATION
NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT
<PAGE>
METROTRANS CORPORATION
777 GREENBELT PARKWAY
GRIFFIN, GEORGIA 30223
April 24, 1998
Dear Stockholder:
You are cordially invited to attend the 1998 Annual Meeting of Stockholders
of Metrotrans Corporation to be held at Suite 5300, 303 Peachtree Street,
Atlanta, Georgia, on Wednesday, May 13, 1998, at 10:00 a.m., local time.
The attached Notice of Annual Meeting and Proxy Statement describe the
formal business to be transacted at the meeting. During the meeting, we also
will report on the operations of the Company during the past year and our plans
for the future. Directors and officers of the Company, as well as
representatives from the Company's independent accountants, Arthur Andersen LLP,
will be present to respond to appropriate questions from stockholders.
Please mark, date, sign and return your proxy card in the enclosed envelope
at your earliest convenience. This will assure that your shares will be
represented and voted at the meeting, even if you do not attend.
Sincerely,
/s/ D. Michael Walden
-----------------------------
D. MICHAEL WALDEN
Chairman of the Board
and Chief Executive Officer
<PAGE>
METROTRANS CORPORATION
777 GREENBELT PARKWAY
GRIFFIN, GEORGIA 30223
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 13, 1998
NOTICE HEREBY IS GIVEN that the 1998 Annual Meeting of Stockholders of
Metrotrans Corporation (the "Company") will be held at Suite 5300, 303 Peachtree
Street, Atlanta, Georgia, on Wednesday, May 13, 1998, at 10:00 a.m., local time,
for the purposes of considering and voting upon:
1. A proposal to elect six directors to serve until the 1999 Annual Meeting
of Stockholders;
2. Such other business as properly may come before the Annual Meeting or
any adjournments thereof. The Board of Directors is not aware of any
other business to be presented to a vote of the stockholders at the
Annual Meeting.
Information relating to the above matters is set forth in the attached
Proxy Statement. Stockholders of record at the close of business on April 3,
1998, are entitled to receive notice of and to vote at the Annual Meeting and
any adjournments thereof.
By Order of the Board of Directors.
/s/ D. Michael Walden
--------------------------------
D. MICHAEL WALDEN
Chairman of the Board
and Chief Executive Officer
Griffin, Georgia
April 24, 1998
PLEASE READ THE ATTACHED PROXY STATEMENT AND THEN PROMPTLY COMPLETE, EXECUTE AND
RETURN THE ENCLOSED PROXY CARD IN THE ACCOMPANYING POSTAGE-PAID ENVELOPE. IF
YOU ATTEND THE ANNUAL MEETING, YOU MAY REVOKE THE PROXY CARD AND VOTE IN PERSON
IF YOU SO DESIRE.
<PAGE>
METROTRANS CORPORATION
777 GREENBELT PARKWAY
GRIFFIN, GEORGIA 30223
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 13, 1998
This Proxy Statement is furnished to the stockholders of Metrotrans
Corporation (the "Company") in connection with the solicitation of proxies by
the Board of Directors of the Company to be voted at the 1998 Annual Meeting of
Stockholders and at any adjournments thereof (the "Annual Meeting"). The Annual
Meeting will be held at Suite 5300, 303 Peachtree Street, Atlanta, Georgia, on
Wednesday, May 13, 1998, at 10:00 a.m., local time.
The approximate date on which this Proxy Statement and form of proxy card
are first being sent or given to stockholders is April 24, 1998.
VOTING
GENERAL
The securities that can be voted at the Annual Meeting consist of Common
Stock of the Company, $.01 par value per share, with each share entitling its
owner to one vote on each matter submitted to the stockholders. The record date
for determining the holders of Common Stock who are entitled to receive notice
of and to vote at the Annual Meeting is April 3, 1998. On the record date,
4,084,294 shares of Common Stock were outstanding and eligible to be voted at
the Annual Meeting.
QUORUM AND VOTE REQUIRED
The presence, in person or by proxy, of a majority of the outstanding
shares of Common Stock of the Company is necessary to constitute a quorum at the
Annual Meeting. In counting the votes to determine whether a quorum exists at
the Annual Meeting, the proposal receiving the greatest number of all votes
"for" or "against" and abstentions (including instructions to withhold authority
to vote) will be used.
In voting with regard to the proposal to elect directors, stockholders may
vote in favor of all nominees, withhold their votes as to all nominees or
withhold their votes as to specific nominees. The vote required to elect
directors is a plurality of the votes cast by the holders of shares entitled to
vote, provided a quorum is present. As a result, votes that are withheld will
not be counted and will have no effect.
Under the rules of the New York and American Stock Exchanges (the
"Exchanges") that govern most domestic stock brokerage firms, member brokerage
firms that hold shares in street name for beneficial owners may, to the extent
that such beneficial owners do not furnish voting instructions with respect to
any or all proposals submitted for stockholder action, vote in their discretion
upon proposals which are considered "discretionary" proposals under the rules of
these two stock exchanges. Member
1
<PAGE>
brokerage firms that have received no instructions from their clients as to
"non-discretionary" proposals do not have discretion to vote on these proposals.
Such "broker non-votes" will not be considered in determining whether a quorum
exists at the Annual Meeting and will not be considered as votes cast in
determining the outcome of any proposal.
As of April 3, 1998 (the record date for the Annual Meeting), the directors
and executive officers of the Company owned or controlled approximately
2,594,967 shares of Common Stock of the Company, constituting approximately
63.5% of the outstanding Common Stock. The Company believes that the holders of
more than a majority of the Common Stock outstanding on the record date will
vote all of their shares of Common Stock in favor of the proposal to elect the
six nominees as directors and, therefore, that the presence of a quorum and the
approval of the proposal is reasonably assured.
PROXIES
Stockholders should specify their choices with regard to the election of
directors on the enclosed proxy card. All properly executed proxy cards
delivered by stockholders to the Company in time to be voted at the Annual
Meeting and not revoked will be voted at the Annual Meeting in accordance with
the directions noted thereon. IN THE ABSENCE OF SUCH INSTRUCTIONS, THE SHARES
REPRESENTED BY A SIGNED AND DATED PROXY CARD WILL BE VOTED "FOR" THE ELECTION OF
ALL DIRECTOR NOMINEES. If any other matters properly come before the Annual
Meeting, the persons named as proxies will vote upon such matters according to
their judgment.
Any stockholder delivering a proxy has the power to revoke it at any time
before it is voted by giving written notice to the Secretary of the Company at
777 Greenbelt Parkway, Griffin, Georgia 30223, by executing and delivering to
the Secretary a proxy card bearing a later date or by voting in person at the
Annual Meeting; provided, however, that under the rules of the Exchanges any
beneficial owner of the Company's Common Stock whose shares are held in street
name by a member brokerage firm may revoke his proxy and vote his shares in
person at the Annual Meeting only in accordance with applicable rules and
procedures of the Exchanges.
In addition to soliciting proxies through the mail, the Company may solicit
proxies through its directors, officers and employees in person and by telephone
or facsimile. Brokerage firms, nominees, custodians and fiduciaries also may be
requested to forward proxy materials to the beneficial owners of shares held of
record by them. All expenses incurred in connection with the solicitation of
proxies will be borne by the Company.
SHARE OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth information regarding the beneficial
ownership of the Company's Common Stock as of December 31, 1997, (i) by each
person known to the Company to be the beneficial owner of more than 5% of the
Company's Common Stock, (ii) each director of the Company, (iii) each of the
executive officers of the Company named in the Summary Compensation Table herein
and (iv) all directors and executive officers of the Company as a group, based
in each case on information furnished to the Company by such persons. The
Company believes that each of the named individuals and group has sole voting
and investment power with regard to the shares shown except as otherwise noted.
2
<PAGE>
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIALLY OWNED(1)
------------------------
NUMBER
NAME AND OF PERCENT
RELATIONSHIP TO COMPANY SHARES OF CLASS
----------------------- ------- ---------
<S> <C> <C>
D. Michael Walden (2) 836,450 (3) 20.5%
Chairman of the Board
Chief Executive Officer and
Principal Stockholder
M. Earl Meck (2) 825,200 20.2
Director and Principal Stockholder
Randy B. Stanley (2) 825,200 20.2
Director and Principal Stockholder
Patrick L. Flinn 2,667 *
Director
George W. Mathews, Jr. 16,000 (3) *
Director
William C. Pitt III 5,000 (3) *
Director
Terri B. Hobbs 62,700 (3) 1.5
Executive Vice President
Richard M. Bruno 21,750 (3) *
Vice President, Chief Financial Officer,
Treasurer and Secretary
All directors and executive officers 2,594,967 (4) 63.5%
as a group (8 persons)
</TABLE>
- ---------
* Less than one percent.
(1) Beneficial ownership as reported in this Proxy Statement has been determined
in accordance with Securities and Exchange Commission regulations and
includes shares of Common Stock of the Company that may be acquired within
60 days of December 31, 1997 upon the exercise of outstanding stock options.
(2) Mr. Walden's address is 777 Greenbelt Parkway, Griffin, Georgia 30223 and
Mr. Meck's and Mr. Stanley's address is 255 O'Dell Road, Griffin, Georgia
30223.
(3) With regard to Mr. Walden, the shares shown include 11,250 shares issuable
upon exercise of outstanding stock options; with regard to Messrs. Mathews
and Pitt, the shares shown include 5,000 shares issuable upon exercise of
outstanding stock options; with regard to Mr. Flinn, the shares shown
include 1,667 shares issuable upon exercise of outstanding stock options;
with regard to Ms. Hobbs, the shares shown include 11,250 shares issuable
upon exercise of outstanding stock options, 30,000 restricted shares that
are subject to forfeiture under certain circumstances and 450 shares owned
by her spouse; and with regard to Mr. Bruno, all of the shares shown are
issuable upon exercise of outstanding stock options.
(4) The shares shown include 55,917 shares that may be acquired by certain
directors and executive officers upon exercise of stock options; 30,000
restricted shares owned by an executive officer that are subject to
forfeiture under certain circumstances; and 450 shares owned by the spouse
of an executive officer.
3
<PAGE>
ELECTION OF DIRECTORS
NOMINEES
The Bylaws of the Company provide that the Board of Directors of the
Company shall consist of not less than three nor more than 15 members and that
the exact number within this range is to be fixed from time to time by the Board
of Directors. The Board of Directors has set the authorized number of directors
of the Company at six and has nominated Patrick L. Flinn, George W. Mathews,
Jr., M. Earl Meck, William C. Pitt III, Randy B. Stanley and D. Michael Walden
for re-election as directors at the 1998 Annual Meeting. Each of the nominees
is currently a director of the Company. If re-elected as directors at the
Annual Meeting, each of such persons would serve a one year term expiring at the
1999 Annual Meeting of Stockholders.
Each of the nominees has consented to serve another term as a director if
re-elected. If any of the nominees should be unavailable to serve for any
reason (which is not anticipated), the Board of Directors may designate a
substitute nominee or nominees (in which event the persons named on the enclosed
proxy card will vote the shares represented by all valid proxy cards for the
election of such substitute nominee or nominees), allow the vacancies to remain
open until a suitable candidate or candidates are located, or by resolution
provide for a lesser number of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" THE PROPOSAL TO ELECT PATRICK L. FLINN, GEORGE W. MATHEWS, JR., M. EARL
MECK, WILLIAM C. PITT III, RANDY B. STANLEY AND D. MICHAEL WALDEN AS DIRECTORS
FOR A ONE YEAR TERM EXPIRING AT THE 1999 ANNUAL MEETING OF STOCKHOLDERS AND
UNTIL THEIR SUCCESSORS HAVE BEEN DULY ELECTED AND QUALIFIED.
INFORMATION REGARDING NOMINEES FOR DIRECTOR
Set forth below is certain information regarding the six nominees for
director, including their ages and principal occupations (which have continued
for at least the past five years unless otherwise noted). Unless otherwise
indicated, the information is as of December 31, 1997.
PATRICK L. FLINN has been a director of the Company since March 1996. He
was a director and the Chief Executive Officer of BankSouth Corporation and
BankSouth, N.A. from August 1991, and Chairman of the Board from January 1992,
until the sale of such entities in February 1996. Prior to that time, Mr. Flinn
was Group Executive Vice President of Real Estate and Mortgage Banking at
C&S/Sovran. He was employed in various capacities at C&S/Sovran since joining
its management training program in 1966. Mr. Flinn is currently a director of
IRT Property Company. Mr. Flinn is 55.
GEORGE W. MATHEWS, JR. has been a director of the Company since June 1994.
Mr. Mathews was Chairman of the Board of Directors and Chief Executive Officer
of Intermet Corporation ("Intermet"), a manufacturer of precision ductile and
gray iron castings, from its organization in 1984 until 1994, Chairman of the
Board of Directors and Chief Executive Officer of Columbus Foundries, Inc., a
wholly-owned subsidiary of Intermet, from its organization in 1971 until 1994,
and President of Intermet from 1991 until 1994. Mr. Mathews was a director of
Intermet from December 1994 until November 1997. Mr. Matthews currently serves
on the Board of Trustees for Wesleyan College and Georgia Tech Foundation. Mr.
Mathews is 70.
M. EARL MECK has been a director of the Company since its incorporation in
1982. Mr. Meck has served as President of First Response, Inc., a manufacturer
of ambulance and emergency vehicles since 1979. Mr. Meck is 53.
4
<PAGE>
WILLIAM C. PITT III has been a director of the Company since June 1994.
Since March 1992, Mr. Pitt has engaged in hotel-resort consulting activities.
From 1990 to February 1992, Mr. Pitt was President of Guinness Enterprises
Holdings, Inc., a subsidiary of Guinness, PLC, London, England, which is engaged
in the leisure and resort business in the United States. From 1976 through
1990, Mr. Pitt was employed by CSX Resorts, Inc. in a variety of management
positions, including President and Chief Executive Officer. Mr. Pitt is a
member of the Board of Directors of United Bancshares, Inc., Charleston, West
Virginia. He is 53.
RANDY B. STANLEY has been a director of the Company since its incorporation
in 1982. Mr. Stanley has served as Secretary and Treasurer of First Response,
Inc. since 1979. Mr. Stanley is 46.
D. MICHAEL WALDEN has served as Chairman of the Board and Chief
Executive Officer of the Company since its incorporation in 1982. Mr. Walden
also served as President of the Company from its incorporation in 1982 until
April 1998. Mr. Walden is 47.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors conducts its business through meetings of the full
Board and through committees of the Board. In accordance with the Bylaws of the
Company, the Board of Directors has established an Audit Committee and a
Compensation Committee.
The Audit Committee makes recommendations to the Board concerning the
appointment of the Company's independent accountants; reviews with such
accountants their audit plan, the scope and results of their audit engagement
and the accompanying management letter, if any; reviews the scope and results of
the Company's internal auditing procedures; consults with the independent
accountants and management with regard to the Company's accounting methods and
the adequacy of its internal accounting controls; approves professional services
provided by the independent accountants; reviews the independence of the
independent accountants; and reviews the range of the independent accountants'
audit and non-audit fees. The Audit Committee is composed of Patrick L. Flinn,
George W. Mathews, Jr., William C. Pitt III and Randy B. Stanley. The Audit
Committee met two times during 1997.
The Compensation Committee is responsible for setting the compensation of
the Chairman of the Board, President and Chief Executive Officer and reviewing
his recommendations regarding the compensation of the Company's other executive
officers. The Compensation Committee is composed of Patrick L. Flinn, George W.
Mathews, Jr., M. Earl Meck and William C. Pitt III. The Compensation Committee
met three times during 1997.
The Board of Directors as a whole functions as the nominating committee to
select management's nominees for election as directors of the Company. The
Board of Directors will consider stockholders' nominees for election as
directors at the Company's 1999 Annual Meeting of Stockholders if submitted to
the Company on or before December 25, 1998. See "Stockholder Proposals for 1999
Annual Meeting" below.
During 1997, the full Board of Directors held four meetings. All of the
directors attended all of the meetings of the Board and the Committees on which
they served held during 1997, except that one director did not attend one of the
Compensation Committee meetings.
5
<PAGE>
DIRECTOR COMPENSATION
Nonemployee directors of the Company are paid an annual retainer fee of
$5,000 plus a fee of $1,250 for attendance at each meeting of the Board of
Directors or committee thereof. Directors who are employees of the Company
receive no directors fees. All directors are reimbursed for their reasonable
expenses in connection with the performance of their duties.
The Company's non-employee directors (excluding Messrs. Meck and Stanley)
are eligible to participate in the Company's 1994 Directors Stock Incentive Plan
(the "DSIP"). Pursuant to the DSIP, as of the first date (the "initial grant
date") on which an individual (A) begins to serve a term as a director of the
Company and (B) is an eligible individual, the individual is granted an option
to purchase 5,000 shares of Company Common Stock. One-third of the options vest
on the first anniversary of the initial grant date and one-third vest on each
anniversary thereafter provided the option holder is still a director on such
date. As of a date (a "subsequent grant date") on which an eligible director
begins to serve another term as a director of the Company after having completed
three complete terms as a director of the Company after such individual's
initial grant date or any subsequent grant date, such director is granted an
option to purchase an additional 5,000 shares of Company Common Stock. The
purchase price of the Company Common Stock underlying each option granted under
the DSIP is equal to the fair market value of the Company Common Stock on the
date the option is granted.
EXECUTIVE COMPENSATION
SUMMARY
The following table sets forth, for the fiscal years ended December 31,
1997, 1996 and 1995, the total compensation earned by the Company's executive
officers whose total compensation for 1997 exceeded $100,000. For information
regarding the various factors considered by the Compensation Committee of the
Board of Directors in determining the compensation of the Chief Executive
Officer and, generally, the other executive officers of the Company, see
"Compensation Committee Report on Executive Compensation" below.
6
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------------------------- -----------------------
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING
NAME AND POSITION YEAR SALARY BONUS COMPENSATION AWARDS($) OPTIONS(#)
- ------------------------- ---- -------- --------- ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
D. Michael Walden 1997 $150,000 - $4,618 (1) - 8,000
Chairman of the Board 1996 150,000 - 4,677 (1) - 15,000
and Chief 1995 150,000 $150,000 5,120 (1) - 15,000
Executive Officer
Terri B. Hobbs 1997 $ 89,660 (2) - $2,616 (1) - 8,000
Executive Vice 1996 134,285 (2) - 5,025 (1) - 15,000
President 1995 110,660 (2) $ 67,525 3,758 (1) $262,500 15,000
Richard M. Bruno 1997 $106,000 - $3,758 (1) - 8,000
Vice President, Chief 1996 103,461 - 2,889 (1) - 15,000
Financial Officer, Treasurer 1995 57,231 (3) $ 40,000 1,649 (1) - 32,000
and Secretary
</TABLE>
____________________
(1) Includes personal use of a Company automobile and, with respect to Mr.
Walden, premiums paid by the Company on long term disability insurance
coverage for his benefit.
(2) Includes a base salary of $22,360 and the balance represents commissions
earned on the sale of vehicles.
(3) Mr. Bruno became employed by the Company in May 1995.
The Company's executive officers also participate in the Company's Employees
Stock Incentive Plan. See "Employees Stock Incentive Plan" below.
EMPLOYMENT AGREEMENT
The Company has entered into an Employment Agreement with D. Michael
Walden, the Chairman of the Board and Chief Executive Officer of the
Company. The Agreement provides that Mr. Walden will serve as Chairman,
President and Chief Executive Officer of the Company for an initial term of
three years commencing on June 16, 1994. The term of the Agreement is
automatically renewable for successive one year terms subject to termination
upon 180 days notice. Mr. Walden continues to serve as Chairman and Chief
Executive Officer of the Company; however, his tenure as President of the
Company ended in April 1998. Mr. Walden's base salary under the agreement is
$150,000 per year and he will be entitled to a severance payment equal to 18
months base salary in the event his employment is terminated other than for
cause, including a change in control. The Company also provides Mr. Walden with
an automobile and long-term disability insurance coverage.
EMPLOYEES STOCK INCENTIVE PLAN
On March 14, 1994, the Board of Directors and shareholders of the Company
adopted the Metrotrans Corporation 1994 Employees Stock Incentive Plan (the
"ESIP"). Incentive stock options nonqualified stock options, reload options and
restricted stock awards may be granted under the ESIP (collectively, "ESIP Stock
Rights"). Under the terms of the ESIP, all employees of the Company (and any
parent or subsidiary corporations), including such employees who are also
members of the Board of Directors of the Company (or of the board of directors
of a subsidiary corporation), are eligible for consideration for the granting of
ESIP Stock Rights. The ESIP is intended to further the growth and development
of the Company by allowing certain employees of the Company (or any parent or
subsidiary companies) to obtain a proprietary interest in the Company through
the grant or purchase of Company Common Stock. The Company believes that the
ESIP will aid in attracting and retaining such individuals and in stimulating
the efforts of such individuals for the success of the Company.
7
<PAGE>
The ESIP is administered by the Compensation Committee of the Board of
Directors of the Company. The members of the Compensation Committee cannot
participate in the ESIP, must be "disinterested persons" within the meaning of
Rule 16b-3 of the Securities Exchange Act of 1934, as amended (the "1934 Act"),
and must be "outside directors" within the meaning of Section 162(m)(4)(C)(i) of
the Internal Revenue Code of 1986, as amended (the "Code"). The Compensation
Committee has authority to (i) determine the individuals to whom ESIP Stock
Rights will be granted from among those individuals who are eligible, as well as
the terms of ESIP Stock Rights and the number of shares of Common Stock covered
by such ESIP Stock Rights, (ii) determine the exercise price and other terms of
the ESIP and (iii) interpret the provisions of, and prescribe, amend and rescind
any rules and regulations relating to, the ESIP.
OPTION GRANTS
The following table sets forth information regarding the number and terms
of stock options granted to the named executive officers during the fiscal year
ended December 31, 1997. Included in such information, in accordance with the
rules and regulations of the Securities and Exchange Commission, is the
potential realizable value of each option granted, calculated using the 5% and
10% option pricing model.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZATION
VALUE AT ASSUMED
INDIVIDUAL GRANTS ANNUAL RATES OF
- ----------------------------------------------------------------------------- STOCK PRICE
NUMBER OF % OF TOTAL APPRECIATION FOR
SECURITIES OPTIONS EXERCISE OPTION TERM
UNDERLYING GRANTED TO OR BASE -----------------------
OPTIONS EMPLOYEES IN PRICE EXPIRATION
NAME GRANTED (#) FISCAL YEAR ($/SH) (2) DATE (3) 5%($) 10%($)
- ------------------ -------------- ------------ ------------ ----------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
D. Michael Walden 8,000 (1) 5.4% $12.00 11/19/07 $60,374 $152,999
Terri B. Hobbs 8,000 (1) 5.4 12.00 11/19/07 60,374 152,999
Richard M. Bruno 8,000 (1) 5.4 12.00 11/19/07 60,374 152,999
</TABLE>
______________
(1) The indicated number of options were granted to the named executive
officers on November 19, 1997 pursuant to the ESIP. Options for 2,000
shares vest on each anniversary of the date of grant until fully vested.
(2) The exercise price of an option may be paid in cash, by delivery of already
owned shares of Common Stock of the Company or by a combination thereof,
subject to certain conditions. To the extent that the exercise price of an
option is paid with shares of Common Stock of the Company, a reload option
may be granted to the optionee. A reload option is an option granted for
the same number of shares as is exchanged in payment of the exercise price
and is subject to all of the same terms and conditions as the original
option except for the exercise price which is determined on the basis of
the fair market value of the Common Stock of the Company on the date the
reload option is granted. One or more successive reload options may be
granted to an optionee who pays for the exercise of a reload option with
shares of Common Stock of the Company.
(3) The options were granted for a term of 10 years, subject to earlier
termination upon occurrence of certain events related to termination of
employment or change of control of the Company; provided, however, the term
for reload options is that of the original option.
8
<PAGE>
OPTION EXERCISES
The following table sets forth the number of shares of Common Stock
acquired upon the exercise of options by the named executive officers during the
fiscal year ended December 31, 1997, including the aggregate value of gains on
the date of exercise. The table also sets forth (i) the number of shares
covered by unexercised options (both exercisable and unexercisable) as of
December 31, 1997, and (ii) the respective values of "in-the-money" options,
which represents the positive spread between the exercise price of existing
options and the fair market value of the Company's Common Stock at December 31,
1997.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL
YEAR-END VALUES
FISCAL YEAR-END
-----------------------------------------------------
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
EXERCISES DURING YEAR AT FISCAL YEAR-END (#) AT FISCAL YEAR-END ($)
------------------------------ -------------------------- --------------------------
SHARES
ACQUIRED VALUE
NAME ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------ ----------------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
D. Michael Walden - - 11,250 26,750 $30,000 $30,000
Terri B. Hobbs - - 11,250 26,750 30,000 30,000
Richard M. Bruno - - 21,750 33,250 77,250 59,250
</TABLE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
This report by the Compensation Committee of the Board of Directors
discusses the Committee's compensation objectives and policies applicable to the
Company's executive officers. The report specifically reviews the Committee's
methods for establishing the compensation of D. Michael Walden, the Company's
Chairman of the Board and Chief Executive Officer (the "Chief Executive
Officer"), for 1997 as reported in the Summary Compensation Table and generally
with respect to all executive officers. The Committee is composed entirely of
non-employee directors.
The Company's compensation programs for its executive officers are intended
to create a direct relationship between the compensation paid to executives and
the Company's performance. The Committee believes that this relationship is
best implemented by providing a compensation package consisting of a base salary
and an incentive bonus tied to Company earnings and designed to promote the
Company's overall performance.
BASE SALARY. For 1997, the Compensation Committee established the base
salary for the Chief Executive Officer based upon a subjective evaluation of his
performance and the overall performance of the Company as well as upon an
informal analysis and review of information available to the Company with
respect to base salary levels of executive officers of companies that are
similar in size to the Company. The Committee reviews the Chief Executive
Officer's base salary annually. The base salaries of the Company's other
executive officers are established by the Chief Executive Officer in his
discretion and recommended by him to the Compensation Committee for approval.
The Chief Executive Officer makes
9
<PAGE>
his recommendations based upon his subjective evaluation of the individual
executive officer's performance and upon the performance of the Company.
SHORT-TERM INCENTIVE COMPENSATION. During 1995, the Compensation Committee
approved and implemented the Metrotrans Corporation Management Incentive
Compensation Plan (the "MICP"). Under the MICP, the Company's executive
officers and other management employees have the opportunity to earn annual
performance bonuses based upon the achievement of certain predetermined
performance objectives. The bonus awarded to the participants in the MICP is
determined on the basis of (i) the Company attaining certain pretax earnings
target levels established by the Compensation Committee and (ii) a rating
assigned to each participant based upon the individual participant performing to
certain standards and achieving goals established by the Compensation Committee
in the case of the Chief Executive Officer and by the Chief Executive Officer in
the case of the remaining participants. A participant is not eligible for any
bonus payment under the MICP unless the Company achieves the minimum pretax
earnings target level established by the Compensation Committee. The actual
bonus is determined utilizing a matrix that considers the actual pretax earnings
of the Company and the individual performance level of the participant whose
performance is rated outstanding, superior, good or satisfactory. Depending on
the performance of the Company and the rating assigned to the individual
participant, a participant may earn a bonus of up to 100% of his or her base
salary, including commissions.
LONG-TERM INCENTIVE COMPENSATION. The Company's long-term incentive
compensation is based upon the ESIP. This plan promotes ownership of the
Company's Common Stock which, in turn, provides a common interest between the
stockholders and executive officers and other management employees of the
Company. The Compensation Committee, which administers the ESIP, generally
grants options under the ESIP with an exercise price equal to the fair market
value of the Company's Common Stock on the date of grant and, in order to
encourage a long-term perspective, with an exercise period of ten years. See
"Employees Stock Incentive Plan" above.
The Securities and Exchange Commission requires an explanation of the
Company's practice regarding adherence to Section 162(m) of the Code, which
disallows the deduction for certain annual compensation in excess of $1 million
paid to executive officers. Given the Company's current level of compensation,
this factor has no effect on the compensation program at this time. However, to
preserve the future deductibility of stock option exercises, the ESIP sets an
annual per-employee limit on the number of shares for which options may be
granted.
COMPENSATION COMMITTEE
Patrick L. Flinn
George W. Mathews, Jr.
M. Earl Meck
William C. Pitt III
10
<PAGE>
STOCK PERFORMANCE GRAPH
The Company's Common Stock began trading on The Nasdaq National Market on
June 10, 1994. The price information reflected for the Company's Common Stock in
the following performance graph represents the closing sales prices of the
Common Stock for the period from June 10, 1994, through December 31, 1997, on a
quarterly basis. The graph and the accompanying table compare the cumulative
total stockholders' return on the Company's Common Stock with the Nasdaq
Composite Index and the S&P 500 Index. The calculations in the following graph
and table assume that $100 was invested on June 10, 1994, in each of the
Company's Common Stock, the Nasdaq Composite Index and the S&P 500 Index and
also assumes dividend reinvestment.
COMPARISON OF CUMULATIVE TOTAL RETURN
AMONG THE COMPANY, NASDAQ COMPOSITE INDEX AND S&P 500 INDEX
<TABLE>
<CAPTION>
Metrotrans Nasdaq S&P 500
Date Corporation Composite Index Index
- -------------------- ----------- --------------- -------
<S> <C> <C> <C>
06/10/94 $100.00 $100.00 $100.00
06/30/94 94.12 96.11 96.99
09/30/94 102.94 104.22 101.79
12/31/94 70.59 102.50 101.78
03/31/95 69.12 111.49 111.71
06/30/95 86.77 127.45 122.46
09/30/95 100.00 142.63 132.27
12/31/95 105.88 143.95 140.08
03/31/96 147.06 150.94 147.83
06/30/96 164.71 162.64 154.50
09/30/96 155.88 168.18 159.31
12/31/96 164.71 176.27 172.72
03/31/97 120.59 167.27 177.30
06/30/97 117.65 197.68 208.33
09/30/97 158.82 231.39 224.16
12/31/97 132.35 215.67 230.55
</TABLE>
11
<PAGE>
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, and
regulations of the Securities and Exchange Commission thereunder require the
Company's directors and executive officers and persons who own more than 10% of
the Company's Common Stock, as well as certain affiliates of such persons, to
file initial reports of their ownership of the Company's Common Stock and
subsequent reports of changes in such ownership with the Securities and Exchange
Commission and the National Association of Securities Dealers, Inc. Directors,
executive officers and persons owning more than 10% of the Company's Common
Stock are required by Securities and Exchange Commission regulations to furnish
the Company with copies of all Section 16(a) reports they file. Based solely on
its review of the copies of such reports received by it and written
representations that no other reports were required for those persons, the
Company believes that during the fiscal year ended December 31, 1997, all filing
requirements applicable to its directors, executive officers and owners of more
than 10% of its Common Stock were complied with in a timely manner except D.
Michael Walden, Terri B. Hobbs, Richard M. Bruno, George W. Mathews, Jr. and
William C. Pitt III who each filed a late Form 5.
STOCKHOLDERS' PROPOSALS FOR 1999 ANNUAL MEETING
Proposals of stockholders, including nominations for the Board of
Directors, intended to be presented at the 1999 Annual Meeting of Stockholders
should be submitted by certified mail, return receipt requested, and must be
received by the Company at its executive offices in Griffin, Georgia, on or
before December 25, 1998 to be eligible for inclusion in the Company's proxy
statement and form of proxy relating to that meeting and to be introduced for
action at the meeting. Any stockholder proposal must be in writing and must set
forth (i) a description of the business desired to be brought before the meeting
and the reasons for conducting the business at the meeting, (ii) the name and
address, as they appear on the Company's books, of the stockholder submitting
the proposal, (iii) the class and number of shares that are beneficially owned
by such stockholder, (iv) the dates on which the stockholder acquired the
shares, (v) documentary support for any claim of beneficial ownership, (vi) any
material interest of the stockholder in the proposal, (vii) a statement in
support of the proposal and (viii) any other information required by the rules
and regulations of the Securities and Exchange Commission.
12
<PAGE>
OTHER MATTERS THAT MAY COME BEFORE THE ANNUAL MEETING
The Board of Directors of the Company knows of no matters other than
those referred to in the accompanying Notice of Annual Meeting of Stockholders
which may properly come before the Annual Meeting. However, if any other matter
should be properly presented for consideration and voting at the Annual Meeting
or any adjournments thereof, it is the intention of the persons named as proxies
on the enclosed form of proxy card to vote the shares represented by all valid
proxy cards in accordance with their judgment of what is in the best interest of
the Company.
By Order of the Board of Directors.
D. Michael Walden
Chairman of the Board
and Chief Executive Officer
Griffin, Georgia
April 24, 1998
____________________________________
The Company's 1997 Annual Report, which includes audited financial
statements, has been mailed to stockholders of the Company with these proxy
materials. The Annual Report does not form any part of the material for the
solicitation of proxies.
13
<PAGE>
REVOCABLE PROXY COMMON STOCK
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE 1998 ANNUAL MEETING
OF STOCKHOLDERS
The undersigned hereby appoints Richard M. Bruno and Terri B. Hobbs, and each
of them, proxies, with full power of substitution, to act for and in the name
of the undersigned to vote all shares of Common Stock of Metrotrans Corporation
(the "Company") which the undersigned is entitled to vote at the 1998 Annual
Meeting of Stockholders of the Company, to be held at Suite 5300, 303 Peachtree
Street, Atlanta, Georgia, on Wednesday, May 13, 1998, at 10:00 a.m., local
time, and at any and all adjournments thereof, as indicated below.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE BELOW-LISTED
PROPOSALS
1) Elect as directors the six nominees listed below to serve until the 1999
Annual Meeting of Stockholders and until their successors are elected and
qualified (except as marked to the contrary below):
[_] FOR ALL NOMINEES listed below (except as marked to the contrary below).
[_] WITHHOLD AUTHORITY to vote for all nominees listed below.
INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through the nominee's name in the list below.
Patrick L. Flinn, George W. Mathews, Jr., M. Earl Meck, William C. Pitt III,
Randy B. Stanley and D. Michael Walden
In their discretion, the proxies are authorized to vote upon such other
business as properly may come before the Annual Meeting and any and all
adjournments thereof.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY CARD IN THE ENCLOSED POSTAGE-
PAID ENVELOPE.
(Continued, and to be signed and dated, on the reverse side)
<PAGE>
LOGO
(Continued from the other side)
PROXY--SOLICITED BY THE BOARD OF DIRECTORS
THIS PROXY CARD WILL BE VOTED AS DIRECTED. IF NO INSTRUCTIONS ARE SPECIFIED,
THIS PROXY CARD WILL BE VOTED "FOR" EACH OF THE PROPOSALS LISTED ON THE REVERSE
SIDE OF THIS PROXY CARD. IF ANY OTHER BUSINESS IS PRESENTED AT THE ANNUAL
MEETING, THIS PROXY CARD WILL BE VOTED BY THE PROXIES IN THEIR BEST JUDGMENT.
At the present time, the Board of Directors knows of no other business to be
presented at the Annual Meeting.
The undersigned may elect to withdraw this proxy card at any time prior to its
use by giving written notice to Secretary of the Company, by executing and
delivering to the Secretary a duly executed proxy card bearing a later date, or
by appearing at the Annual Meeting and voting in person.
__________________________________
Signature
__________________________________
Signature, if shares held jointly
Date: ______________________, 1998
Please mark, date and sign exactly as your name appears on this proxy card.
When shares are held jointly, both holders should sign. When signing as
attorney, executor, administrator, trustee, guardian or custodian, please give
your full title. If the holder is a corporation or a partnership, the full
corporate or partnership name should be signed by a duly authorized officer.
Do you plan to attend the Annual Meeting? [_] YES [_] NO
