<PAGE>
===============================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
AirTran Holdings, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
AirTran Holdings, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
<PAGE>
AIRTRAN HOLDINGS, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of AirTran Holdings, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of AirTran
Holdings, Inc. (the "Company") will be held at the Georgia International
Convention Center, 1902 Sullivan Road, College Park, Georgia 30337 on Thursday,
May 18, 2000 at 11:00 a.m. Eastern Daylight Savings Time, for the following
purposes:
(1) To elect Directors for terms of one, two and three years; and
(2) To transact such other business as may properly come before the
meeting.
Holders of the Common Stock of record at the close of business on March 31,
2000, will be entitled to notice of and to vote at the meeting.
Whether or not you expect to be present in person at the meeting, please
sign and date the accompanying proxy and return it promptly in the enclosed
postage paid reply envelope. This will assist us in preparing for the meeting.
By Order of the Board of Directors
Leslie C. Head
Secretary
April 7, 2000
Orlando, Florida
<PAGE>
AIRTRAN HOLDINGS, INC.
9955 AirTran Boulevard
Orlando, Florida 32827
(407) 261-5600
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of AirTran Holdings, Inc., a Nevada
corporation (the "Company") to be voted at the Annual Meeting of the
Stockholders of the Company to be held on May 18, 2000, and any adjournment or
adjournments thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders. The Annual Meeting of Stockholders will be held
at the Georgia International Convention Center, 1902 Sullivan Road, College
Park, Georgia 30337, on Thursday, May 18, 2000, at 11:00 a.m. Eastern Daylight
Savings Time. This proxy statement and accompanying form of proxy were first
sent or given to Stockholders on or about April 7, 2000. The Company's Annual
Report for the year ended December 31, 1999, is being sent, concurrently
herewith, to each Stockholder of record.
ABOUT THE MEETING
What is the purpose of the annual meeting?
At the Company's annual meeting, Stockholders will act upon the matters
outlined in the accompanying notice of meeting, including the election of
Directors. In addition, the Company's management will report on the performance
of the Company during the 1999 year and respond to questions from Stockholders.
Who is entitled to vote?
Only Stockholders of record at the close of business on the record date,
March 31, 2000, are entitled to receive notice of the annual meeting and to vote
the shares of Common Stock that they held on that date at the meeting, or any
postponement or adjournment of the meeting. Each outstanding share entitles its
holder to cast one vote on each matter to be voted upon.
Who can attend the meeting?
All Stockholders as of the record date, or their duly appointed proxies,
may attend the meeting. Seating, however, may be limited. Admission to the
meeting will be on a first-come, first-served basis. Each Stockholder may be
asked to present valid picture identification, such as a driver's license or
passport. Cameras, recording devices and other electronic devices will not be
permitted at the meeting.
Please note that if you hold your shares in "street name" (that is,
through a broker or other nominee), you will need to bring a copy of a brokerage
statement reflecting your stock ownership as of the record date.
<PAGE>
What constitutes a quorum?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of Common Stock outstanding on the record date will
constitute a quorum, permitting the meeting to conduct its business. As of the
record date, 65,724,146 shares of Common Stock of the Company were outstanding.
Proxies received but marked as abstentions and broker non-votes will be included
in the calculations of the number of shares considered to be present at the
meeting.
How do I vote?
If you complete and properly sign the accompanying proxy card and return
it to the Company, it will be voted as you direct. If you are a registered
stockholder and attend the meeting, you may deliver your completed proxy card in
person. "Street name" Stockholders who wish to vote at the meeting will need to
obtain a proxy form from the institution that holds their shares.
Can I change my vote after I return my proxy card?
Yes. Even after you have submitted your proxy, you may change your vote
at any time before the proxy is exercised by filing with the Secretary of the
Company either a notice of revocation or a duly executed proxy bearing a later
date. The powers of the proxy holders will be suspended if you attend the
meeting in person and so request, although attendance at the meeting will not by
itself revoke a previously granted proxy.
What are the Board's recommendations?
Unless you give other instructions on your proxy card, the persons named
as proxy holders on the proxy card will vote in accordance with the
recommendations of the Board of Directors. The Board recommends a vote FOR
election of the nominated slate of Directors.
With respect to any other matter that properly comes before the meeting,
the proxy holders will vote as recommended by the Board of Directors or, if no
recommendation is given, in their own discretion.
What vote is required to approve each item?
Election of Directors. The affirmative vote of a plurality of the votes
cast at the meeting is required for the election of Directors. A properly
executed proxy marked "WITHHOLD AUTHORITY" with respect to the election of one
or more Directors will not be voted with respect to the Director or Directors
indicated, although it will be counted for purposes of determining whether there
is a quorum.
Other Items. For each other item, the affirmative vote of the holders of
a majority of the shares represented in person or by proxy and entitled to vote
on the item will be required for approval. The Company's management knows of no
matter to be brought before the meeting other than those mentioned herein. If,
however, any other matters properly come before the meeting, it is intended that
the proxies will be voted in accordance with the judgment of the person or
persons voting such proxies.
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<PAGE>
How will proxies be solicited?
Proxies will be solicited by mail. Proxies may also be solicited by
officers and regular employees of the Company personally or by telephone or
facsimile, but such persons will not be specifically compensated for such
services. Banks, brokers, nominees and other custodians and fiduciaries will be
reimbursed for their reasonable out-of-pocket expenses in forwarding soliciting
material to their principals, the beneficial owners of Common Stock of the
Company. The expense of preparing, assembling, printing, mailing and soliciting
proxies will be borne by the Company.
STOCK OWNERSHIP
Security Ownership of Management and Certain Beneficial Owners
The following table sets forth, as of February 28, 2000 (unless otherwise
indicated in the footnotes), certain information with respect to the Company's
Common Stock owned beneficially by each Director, by each Nominee for election
as a Director, by all Executive Officers and Directors as a group and by each
person known by the Company to be a beneficial owner of more than 5% of the
outstanding Common Stock of the Company. Except as noted in the footnotes, each
of the persons listed has sole investment and voting power with respect to the
shares of Common Stock included in the table.
<TABLE>
<CAPTION>
Number of Shares Percent
Name of Beneficial Owner Beneficially Owned (1) of Ownership (2)
- ------------------------ ---------------------- ----------------
<S> <C> <C>
Lewis H. Jordan (3)............................ 4,265,235 6.2%
Robert L. Priddy (4)............................ 2,650,000 4.0%
Robert D. Swenson (5)........................... 699,895 1.1%
Joseph B. Leonard (6)........................... 600,000 *
Don L. Chapman (7).............................. 92,000 *
John K. Ellingboe (8)........................... 43,620 *
William J. Usery, Jr............................ 6,000 *
All Executive Officers and Directors as a
group (10 persons) (2)(3)(4)(5)(6)(7)(8)(9).. 8,588,416 12.2%
</TABLE>
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* Less than 1%
(1) Information with respect to beneficial ownership is based upon information
furnished by each owner.
(2) The percent of outstanding Common Stock owned is determined by assuming that
in each case the person only, or group only, exercised his or its rights to
purchase all shares of Common Stock underlying presently exercisable stock
options.
(3) Includes options to purchase 3,050,000 shares of Common Stock which are
presently exercisable and also includes 50,000 shares owned by a trust under
which Mr. Jordan is a beneficiary. Mr. Jordan's address is 610 Wingspread,
Peachtree City, Georgia 30269.
(4) Includes options to purchase 650,000 shares of Common Stock which are
presently exercisable.
(5) Includes options to purchase 335,000 shares which are presently exercisable.
Includes 87,220 shares of Common Stock held by Mr. Swenson's wife and 83,720
shares of Common Stock Mr. Swenson holds as custodian for his minor
children.
(6) Includes options to purchase 600,000 shares which are presently
exercisable.
(7) Includes 69,000 shares of Common Stock owned by a corporation in which Mr.
Chapman is an officer and sole stockholder and options to purchase 20,000
shares of Common Stock which are presently exercisable.
(8) Includes options to purchase 22,000 shares which are presently exercisable.
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<PAGE>
(9) In addition to outstanding shares of Common Stock owned by Executive
Officers not named in the table, also included are options to purchase 116,
666, 50,000 and 50,000 shares of Common Stock by Robert L. Fornaro, Stephen
J. Kolski and Marilyn Rogers, respectively, which are presently exercisable.
ELECTION OF DIRECTORS
The By-laws of the Company have been recently amended to provide for a Board
of Directors with staggered terms. Upon the expiration of the term of each
Board member elected in 2000, each successor or reelected Director will serve
for a three-year term. The Company's By-laws provide that there shall be not
less than three, nor more than nine, Directors. The Board of Directors has
determined that seven Directors be elected for the ensuing year. The following
persons have been nominated for election to the Board of Directors: Don L.
Chapman, John K. Ellingboe, Lewis H. Jordan, Joseph B. Leonard, Robert L.
Priddy, Robert D. Swenson and William J. Usery, Jr. All of the nominees are
currently Directors except for Mr. Usery. Messrs. Chapman, Jordan, and Leonard
have been nominated as Class I Directors for a three-year term expiring in 2003.
Messrs. Swenson and Usery have been nominated as Class II Directors for a two-
year term expiring in 2002. Messrs. Ellingboe and Priddy have been nominated as
Class III Directors for a one-year term expiring in 2001. It is the intention
of the persons named in the accompanying proxy form to vote for the election of
all nominees. If for any reason any such nominee is not a candidate when the
election occurs, which event is not anticipated, it is the intention of the
persons named in the accompanying proxy form to vote for the remaining nominees
named and to vote in accordance with their best judgment if any substitute
nominees are named.
Identification of Directors and Executive Officers
The following table contains the name, age and position with the Company of
each Executive Officer and Director of the Company. Their respective
backgrounds are described following the table.
<TABLE>
<CAPTION>
Age Position
--- --------
<S> <C> <C>
Joseph B. Leonard 56 Chairman of the Board, President, Chief Executive Officer and Director
Robert L. Fornaro 47 President of Operating Subsidiary
Stephen J. Kolski 59 Senior Vice President - Operations of Operating Subsidiary
Marilyn L. Rogers 52 Senior Vice President - Customer Service of Operating Subsidiary
Don L. Chapman 60 Director
John K. Ellingboe 49 Director
Lewis H. Jordan 55 Director
Robert L. Priddy 53 Director
Robert D. Swenson 45 Director
William J. Usery, Jr. 76 Nominee for Director
</TABLE>
Joseph B. Leonard joined the Company in January 1999 as Chairman of the
Board, President and Chief Executive Officer. From 1993 to 1998, Mr. Leonard
served in various executive capacities for AlliedSignal, Inc. and its Aerospace
division, last serving as the President and Chief Executive Officer of
Marketing, Sales and Service of AlliedSignal Aerospace and Senior Vice President
of AlliedSignal, Inc. during 1998. From 1991 to 1993, Mr. Leonard served as
Executive Vice President of Northwest Airlines. Prior to that, Mr. Leonard
served in various executive positions for Eastern Airlines from 1984 to 1990, as
Assistant Vice President, Aircraft Maintenance for American Airlines from 1982
to 1984 and in various
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<PAGE>
maintenance and quality control positions for Northwest Airlines from 1969 to
1982. Mr. Leonard was elected to the Board of Directors pursuant to the terms of
his Employment Agreement with the Company.
Robert L. Fornaro joined the Company in March 1999 as the President of its
operating subsidiary. From February 1998 until March 1999, he served as a
consultant in the airline industry. From 1992 to February 1998, Mr. Fornaro
served as Senior Vice President - Planning for US Airways. Prior to that, he
served as Senior Vice President - Marketing Planning at Northwest Airlines from
1988 to 1992.
Stephen J. Kolski joined the Company in March 1999 as Senior Vice President
- - Operations of its operating subsidiary. From 1995 until March 1999, he served
as a consultant in the aerospace industry. From 1993 to 1995, he served as a
Director, President and Chief Operating Officer of ATX, Inc. From 1990 to 1993,
Mr. Kolski served as President and Chief Operating Officer of Continental
Express. From 1966 to 1990, Mr. Kolski held various management positions with
responsibilities over flight operations, aircraft maintenance and collective
bargaining negotiations for National Airlines (1966 to 1980), New York Air
which he co-founded (1980 to 1987) and Eastern Airlines (1987 to 1990).
Marilyn L. Rogers joined the Company in March 1999 as Senior Vice President
- - Customer Service of its operating subsidiary. From 1991 to March 1999, Ms.
Rogers worked for Northwest Airlines in various management positions, serving as
Vice President - Customer Service - Ground Operations for the Central U.S.
Region from 1995 to 1999. Prior to that, Ms. Rogers served in various
capacities for Eastern Airlines from 1972 to 1991, her last position being as
director of customer service.
Don L. Chapman has served as a Director of the Company since 1994. From
December 1998 until March 2000, Mr. Chapman served as President of S&S Tug
Manufacturing Company, a ground support equipment manufacturer. He served as
Chief Executive Officer of that company's predecessor, Tug Manufacturing
Company, since he acquired that company in 1977. He also served as Chief
Executive Officer of Opti World, Inc., an optical superstore chain, from 1983
(when he founded that company) until 1995. He also serves as a director of Rare
Hospitality (since 1992).
John K. Ellingboe was elected as a Director of the Company in November 1997
pursuant to the terms of the Merger Agreement between the Company and Airways
Corporation ("Airways"). He served as a director of Airways from April 1995
until November 1997 when Airways merged into the Company and a director of
AirTran Airways from June 1994 until November 1997. Since March 1999, Mr.
Ellingboe has served in a senior management position with Ovations, Inc., a
subsidiary of UnitedHealth Group Company and currently serves as its chief
operating officer. From January 1998 until March 1999, Mr. Ellingboe served as
President, Mergers and Acquisitions of NJK Holding Corporation, a private
investment company, and since June 1996, Mr. Ellingboe has also been Chief
Executive Officer of PMSA Management Group, LLC, a management consulting firm.
From 1990 to May 1996, he was Vice President, Business Development, General
Counsel and Secretary of Fingerhut Companies, Inc. and served as Senior Vice
President of that company from October 1993 to May 1996.
Lewis H. Jordan is the owner and principal officer of Wingspread
Enterprises, an investment and consulting firm which he founded in August 1997.
Mr. Jordan has served as a Director of the Company since June 1993. Mr. Jordan
also served as President and Chief Operating Officer of the Company from June
1993 until November 1997. As of November 1996, he resigned his position as
President and Chief Operating Officer of the Company's operating subsidiary. He
served as President and Chief Operating Officer and as a director of Continental
Airlines from August 1991 to March 1993 and served as Executive
-5-
<PAGE>
Vice President of that company from 1986 to August 1991. He also serves as a
Director of Rare Hospitality (since 1998).
Robert L. Priddy is an investor and owner of RMC Capital, LLC, an
investment company which he founded in February 1998. Mr. Priddy was employed
as the Chairman of the Board and Chief Executive Officer of the Company from its
inception until November 1997. He has served as a Director of the Company since
he participated in its founding in 1992. As of November 1996, he resigned his
position as Chairman of the Board and Chief Executive Officer of the Company's
operating subsidiary. He also serves as a director of Accumed International, a
medical equipment company (since 1997).
Robert D. Swenson is the owner and principal officer of Pacific Alaskan
Airways, LLC, an aviation consulting firm in which he has been actively involved
since September 1999. Mr. Swenson was elected as Chairman of the Board of the
Company in November 1997 pursuant to the terms of the merger agreement with
Airways and served in such position until January 1999 when Mr. Leonard joined
the Company. Mr. Swenson continues to serve as a Director of the Company. He
served as Chairman of the Board and Chief Executive Officer of Airways from
April 1995 until November 1997 when Airways merged into the Company and he
served as Chairman of the Board of AirTran Airways from June 1994 until November
1997. From June 1994 to January 1995, Mr. Swenson was President of AirTran
Airways. Mr. Swenson served as Director, President and Chief Executive Officer
of Mesaba Holdings, Inc. and its subsidiary, Mesaba Aviation, Inc. from 1981 to
1995 and was Chairman of the Board of Mesaba Holdings, Inc. and Mesaba Aviation,
Inc. from 1986 to September 1995.
William J. Usery, Jr. has served as president of Bill Usery Associates,
Inc., a labor-management consulting firm, since 1978. Previously Mr. Usery has
served in many labor-management positions with the federal government, including
as Secretary of Labor under President Ford from 1976 to 1977, as National
Director of the Federal Mediation and Conciliation Service (FMCS) from 1973 to
1976 and as Assistant Secretary of Labor for Labor-Management Relations under
President Nixon from 1969 to 1973.
The merger agreement between Airways Corporation and the Company provided
for the Company to select four members of the Board and for Airways to select
three members of the Board. Five of the current members of the Board (Messrs.
Chapman, Ellingboe, Jordan, Priddy and Swenson) were selected by the respective
companies in accordance with the terms of the merger agreement.
Committees of the Board of Directors
The Company has a standing Audit Committee and Compensation Committee. The
Audit Committee consists of Don L. Chapman, Robert L. Priddy and John K.
Ellingboe. The Audit Committee met two times during the 1999 fiscal year. The
Audit Committee is empowered to: (i) recommend the appointment or removal of
the Company's auditors; (ii) review and recommend approval of the scope and
results of the independent audit of the Company; (iii) review audit fees; and
(iv) review changes in accounting policies that have a significant effect on the
Company's financial reports.
The Compensation Committee consists of Robert D. Swenson and John K.
Ellingboe. Lewis H. Jordan serves as a non-voting member of this committee.
The Compensation Committee met one time separately from the entire Board during
1999 and acted during Board meetings on other occasions. In addition, the
Compensation Committee took action by unanimous consent of its members on
several occasions. The Compensation Committee is empowered to: (i) approve
compensation levels for each
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<PAGE>
Executive Officer who also serves as a member of the Board of Directors and for
any other officer or employee of the Company whose annual base salary is in
excess of $100,000; (ii) approve all incentive payments to each Executive
Officer who also serves as a member of the Board of Directors; (iii) administer
the Company's stock option plans; and (iv) undertake administration, upon
specific direction of the Board of Directors, of other employee benefit plans.
Meetings of the Board of Directors
The Board of Directors met 15 times during the Company's 1999 fiscal year
and took action on other occasions by unanimous consent. Each incumbent
Director attended at least 75% of the total of all Board and Committee meetings
he was entitled to attend during the 1999 year.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's Directors and
Executive Officers, and persons who own more than 10% of the Company's equity
securities, to file initial reports of ownership and reports of changes in
ownership with the Securities and Exchange Commission. Such persons are
required by the Exchange Act to furnish the Company with copies of all Section
16(a) forms they file.
Based solely on its review of the copies of such forms received by it with
respect to transactions during 1999, or written representations from certain
reporting persons, the Company believes that all filing requirements applicable
to its Directors, Executive Officers and persons who own more than 10% of the
Company's equity securities have been complied with except that the initial
beneficial ownership reports of Robert L. Fornaro and Marilyn Rogers were filed
late.
EXECUTIVE COMPENSATION
Summary of Cash and Certain Other Compensation
The following table shows, for the fiscal years ended December 31, 1997,
December 31, 1998, and December 31, 1999, the cash compensation paid by the
Company, as well as certain other compensation paid or accrued for such year,
for the Company's Chief Executive Officer and those other Executive Officers
with compensation in excess of $100,000 during 1999. Such table also indicates
all capacities in which they served.
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<PAGE>
Summary Compensation Table
<TABLE>
<CAPTION>
Long Term
Compensation
Annual Compensation Awards
------------------------------------ ------------
Other All
Name and Annual other
Principal Compen- Options Compen-
Position Year Salary ($) Bonus ($) sation ($) (#) sation ($)
- -------------------------------- ---- ---------- --------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Joseph B. Leonard, Chairman 1999 336,539 0 100,000 1,500,000 0
of the Board, President and
Chief Executive Officer (1)
D. Joseph Corr, President and 1999 23,077 0 300,000 None 0
Chief Executive Officer (2) 1998 299,241 0 0 None 0
1997 253,151 0 0 600,000(3) 0
Robert L. Fornaro 1999 186,538 0 0 350,000 0
Senior Vice President (4)
Stephen J. Kolski 1999 113,654 0 0 150,000 0
Senior Vice President (5)
Marilyn Rogers 1999 113,654 0 0 150,000 0
Senior Vice President (6)
</TABLE>
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(1) A signing bonus of $100,000 is reflected as other compensation.
(2) Prior to November 1997, Mr. Corr served as President of the Company's
operating subsidiary. Mr. Corr's employment with the Company terminated in
January 1999. The other compensation reflected for Mr. Corr in 1999
represents a severance payment to him that was paid upon his termination of
employment.
(3) Includes the repricing of 450,000 options originally granted in 1996.
(4) Mr. Fornaro commenced employment with the Company in March 1999, and
therefore, the compensation shown for him for 1999 is for the period from
March 1999 through December 1999.
(5) Mr. Kolski commenced employment with the Company in March 1999, and
therefore, the compensation shown for him for 1999 is for the period from
March 1999 through December 1999.
(6) Ms. Rogers commenced employment with the Company in March 1999, and
therefore, the salary shown for her is for the period from March 1999
through December 1999.
None of the individuals listed above received perquisites or personal
benefits during 1999 in excess of the lesser of $50,000 or 10% of his annual
salary and bonus. The amount of such benefits to all Executive Officers as a
group during 1999 was less than 10% of their aggregate annual salaries and
bonuses.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee consists of Robert D. Swenson and John K.
Ellingboe, neither of whom are officers or employees of the Company.
Employment Agreements and Change of Control Arrangements
Joseph B. Leonard. The Company's employment agreement with Mr. Leonard
provides for a three year term expiring on December 31, 2001, and severance pay
of $500,000 in the event Mr. Leonard's employment is terminated by the Company
without cause. Mr. Leonard's base salary under the employment agreement is
$350,000 per year and he may earn a bonus of up to 150% of his base salary each
year based on the profitability of the Company during the year. In connection
with the execution of the employment agreement, Mr. Leonard was paid a $100,000
signing bonus and was granted 1,500,000 options vesting over
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<PAGE>
a three year period. Under the agreement, Mr. Leonard is also entitled to
reimbursement of certain moving expenses.
Robert L. Fornaro. Upon a termination of Mr. Fornaro's employment after a
change of control, Mr. Fornaro will be entitled to a continuance of his salary
for a two-year period and all of his stock options will become vested.
Option Grants in Last Fiscal Year
The table below sets forth information regarding all stock options granted
in the 1999 fiscal year under the Company's Stock Option Plans to those
Executive Officers of the Company named in the Compensation Table above.
<TABLE>
<CAPTION>
% of Potential Realized
Total Market Value at
Number of Options Price Assumed Annual
Securities Granted to or Fair Rates of
Underlying Employees Value Stock Price
Options in Fiscal Exercise on Date Expiration Appreciation (2)
Granted Year Price of Grant Date 5% 10%
---------- ----------- --------- ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Joseph B. Leonard 1,500,000 57.8% $3.03 $3.03 1/4/09 $2,859,505 $7,246,548
D. Joseph Corr None
Robert Fornaro 350,000 13.5% $3.78 $3.78 3/23/09 $ 832,303 $2,109,219
Stephen Kolski 150,000 5.8% $3.31 $3.31 3/18/09 $ 312,482 $ 791,891
Marilyn Rogers 150,000 5.8% $3.31 $3.31 3/18/09 $ 312,482 $ 791,891
</TABLE>
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(1) The dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the Securities and Exchange Commission and therefore
are not intended to forecast possible future appreciation, if any, of the
price of the Company's stock.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option
Values
The following table shows aggregate exercises of options during 1999 and
the values of options held as of December 31, 1999 by those Executive Officers
of the Company named in the Compensation Table above.
<TABLE>
<CAPTION>
Number of Value of Unexercised
Unexercised Options In-The-Money Options
December 31, 1999 (#) December 31, 1999 (1)
Shares Acquired Value Exercisable (E)/ Exercisable (E)/
Name on Exercise (#) Realized Unexercisable (U) Unexercisable (U)
- ------------------- --------------- ---------------- ---------------------- ----------------------
<S> <C> <C> <C> <C>
Joseph B. Leonard - - 1,500,000 U $2,223,000
D. Joseph Corr 100,000 $100,000 450,000 E None
Robert L. Fornaro - - 350,000 U $ 256,200
Stephen J. Kolksi - - 150,000 U $ 180,112
Marilyn Rogers - - 150,000 U $ 180,112
</TABLE>
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(1) Amounts shown are based upon the closing sale price for the Company's Common
Stock on December 31, 1999, which was $4.51325 per share.
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<PAGE>
Director Compensation
The Company's outside Directors (Messrs. Chapman, Ellingboe, Jordan,
Priddy, Swenson and, when elected, Mr. Usery) receive a retainer of $5,000 per
quarter plus meeting fees of $1,000 per meeting of the Board of Directors or
Committee attended in person and $500 per meeting of the Board of Directors or
Committee attended by phone in addition to reimbursement of their expenses in
attending meetings of the Board of Directors. In addition, each outside
Director is to receive options to purchase 5,000 shares of Common Stock upon the
date of the Company's annual stockholders' meeting at the then current stock
price, with vesting over three years of service for the Company.
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The compensation of the Company's Executive Officers is determined by the
Compensation Committee of the Board of Directors on an annual basis. The
Compensation Committee considers all elements of compensation in making its
determinations. With respect to those Executive Officers who do not serve on
the Company's Board of Directors, the Compensation Committee also considers the
recommendations of the Company's President and Chief Executive Officer. The
principal elements of compensation for the Company's Executive Officers are base
salary, cash bonuses and stock incentives and stock options.
Base Salary. The base salary of the Company's President and Chief
Executive Officer during 1999 (Joseph B. Leonard) was established at $350,000
per year under his employment agreement pursuant to negotiations with Mr.
Leonard. The employment agreement was signed in January 1999.
Cash Bonuses. The Company adopted an Executive Incentive Compensation
Plan for 1999 under which Mr. Leonard and other management employees became
entitled to a bonus for 1999 based on the Company's profitability (calculated
based on a return on equity) in excess of a base rate equal to the treasury bill
rate. In making the calculation, the DC-9 fleet impairment charge taken by the
Company in fourth quarter 1999 and the income from the settlement of the
Company's lawsuit against SabreTech were excluded. Due to the Company's
profitability during 1999, incentive bonuses of $75,000 - $525,000 were paid in
first quarter 2000 to the Company's four Executive Officers for the 1999 year in
accordance with the Executive Incentive Compensation Plan.
Stock Options. The Company intends to rely heavily on stock options to
provide incentive compensation to its Executive Officers and other key employees
and to align their interests with those of the Company's Stockholders. In that
regard, stock options were granted to the Company's newly hired Chairman of the
Board, President and Chief Executive Officer in January 1999 (options to
purchase 1,500,000 shares) and to the Company's newly hired President and Chief
Financial Officer in March 1999 (options to purchase 350,000 shares) and to
other newly hired officers during the year. All of these options are
exercisable at fair market value. All of these options will vest over three
years. The vesting schedule is designed to encourage employment with the
Company throughout the vesting period.
Submitted by
COMPENSATION COMMITTEE
John K. Ellingboe Robert D. Swenson
The foregoing report should not be deemed incorporated by reference by
any general statement incorporating by reference this Proxy Statement into any
filing under the Securities Act of 1933 or under the Securities Exchange Act of
1934, except to the extent that the Company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.
-10-
<PAGE>
STOCK PRICE PERFORMANCE GRAPH
The following stock price performance graph compares the Company's
performance to the CRSP Total Return Index for The NASDAQ Stock Market (US) and
the Standard & Poors Airlines Index. The stock price performance graph assumes
an investment of $100 in the Company and the two indexes, respectively, on June
28, 1994, and further assumes the reinvestment of all dividends. The Standard &
Poors Airlines Index includes AMR Corporation, Delta Air Lines, USAir Group and
Southwest Airlines. Stock price performance, presented for the period from June
28, 1994 (the date upon which the Common Stock of the Company was first traded)
through December 31, 1999 is not necessarily indicative of future results. The
June 28, 1994 stock price used for the Company's stock is the initial public
offering price.
[Graph goes here]
<TABLE>
<CAPTION>
6/28/94 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
--------- --------- --------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
AirTran Holdings, Inc. $100.00 $170.00 $792.00 $206.00 $128.00 $ 84.00 $144.42
Standard & Poors Airlines Index $100.00 $ 84.08 $122.79 $134.61 $226.57 $219.19 $217.38
NASDAQ Stock Market Index $100.00 $107.11 $149.87 $183.89 $223.68 $312.33 $579.63
</TABLE>
The stock price performance graph shall not be deemed incorporated by
reference by any general statement incorporating by reference this Proxy
Statement into any filing under the Securities Act of 1933 or under the
Securities Exchange Act of 1934, except to the extent that the Company
specifically incorporates this information by reference, and shall not otherwise
be deemed filed under such Acts.
-11-
<PAGE>
CERTAIN TRANSACTIONS
During 1999, the Company purchased ground support equipment from S&S Tug
Manufacturing Corporation ("S&S Tug") in which Don L. Chapman is an executive
officer. The amount of ground support equipment purchased by the Company from
S&S Tug was approximately $113,000 during 1999. The Company intends to continue
purchasing such equipment from S&S Tug so long as S&S Tug's equipment meets the
Company's quality, price and time of delivery requirements. The Company began
to purchase equipment from S&S Tug and its predecessor corporation prior to Mr.
Chapman being elected to the Company's Board of Directors and management
believes that its purchases from S&S Tug and its predecessor corporation have
been at competitive prices and terms. Effective as of March 1, 2000, Mr.
Chapman no longer serves as an executive officer of S&S Tug.
RELATIONSHIP WITH INDEPENDENT AUDITORS
The Board of Directors has selected Ernst & Young LLP as the Company's
independent auditors for the ensuing fiscal year. Ernst & Young LLP has served
as the Company's independent auditors since its inception. Representatives of
Ernst & Young LLP are expected to be present at the Annual Meeting with the
opportunity to make a statement if they desire to do so and to respond to
appropriate questions.
OTHER MATTERS
Stockholders' Proposals for Annual Meeting to be held in 2001
The Company plans to hold its 2001 Annual Meeting of Stockholders during
the month of May. Any proposal of a Stockholder intended to be presented at said
Annual Meeting of Stockholders must be received by the Company for inclusion in
the proxy statement and form of proxy for that meeting no later than December 8,
2000.
Action on Other Matters at the Annual Meeting
At this time, the Company does not know of any other matters to be
presented for action at the Annual Meeting other than those mentioned in the
Notice of Annual Meeting of Stockholders and referred to in this proxy
statement. If any other matter comes before the meeting, it is intended that
the proxies will be voted in respect thereof in accordance with the judgment of
the persons voting the proxies.
-12-
<PAGE>
STOCKHOLDERS ARE URGED TO DATE, SIGN AND RETURN PROMPTLY THE ENCLOSED
PROXY IN THE ACCOMPANYING ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES. YOUR COOPERATION WILL BE APPRECIATED. YOUR PROXY WILL BE VOTED,
WITH RESPECT TO THE MATTERS IDENTIFIED THEREON, IN ACCORDANCE WITH ANY
SPECIFICATIONS ON THE PROXY.
BY ORDER OF THE BOARD OF DIRECTORS,
Leslie C. Head
Secretary
-13-
<PAGE>
FOLD AND DETACH HERE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 18, 2000
AIRTRAN HOLDINGS, INC.
The undersigned hereby appoints Joseph B. Leonard and Leslie C. Head, or
either of them, as Proxies, each with the power to appoint his substitute, and
hereby authorizes them to represent and to vote, as designated below, all the
shares of common stock held of record on March 31, 2000, at the Annual Meeting
of the Stockholders to be held on May 18, 2000, at 11:00 A.M. at the Georgia
International Convention Center, 1902 Sullivan Road, College Park, Georgia
30337, or any adjournment thereof.
1. Election of Directors
[_] FOR all nominees listed [_] WITHHOLD AUTHORITY to vote
below (except as marked to for all nominees listed below
the contrary below)
(Instruction: To withhold authority to vote for any individual nominee strike
a line through the nominee's name in the list below).
For election as Class I Directors for a three year term expiring in 2003
Don L. Chapman, Lewis H. Jordan, Joseph B. Leonard
For election as Class II Directors for a two year term expiring in 2002
Robert D. Swenson, William J. Usery
For election as Class III Directors for a one year term expiring in 2001
John K. Ellingboe, Robert L. Priddy
2. In their discretion, the Proxies are authorized to vote upon such other
business as may come before the meeting or adjournment thereof.
THIS PROXY, DULY EXECUTED, WILL BE VOTED AS SPECIFIED. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR PROPOSAL 1.
<PAGE>
FOLD AND DETACH HERE
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
The undersigned hereby acknowledges receipt of the Proxy Statement and Notice
of Annual Meeting to be held May 18, 2000.
Dated: _____________________, 2000
____________________________(SEAL)
____________________________(SEAL)
(Please sign exactly as your name
appears hereon. If stock is reg-
istered in more than one name,
each holder should sign. When
signing as an attorney, adminis-
trator, executor, guardian or
trustee, please add your title as
such. If executed by a corpora-
tion, the proxy should be signed
by a duly authorized officer).
PLEASE SIGN, DATE AND PROMPTLY
RETURN THIS PROXY IN THE ENCLOSED
ENVELOPE. NO POSTAGE IS REQUIRED
IF MAILED IN THE UNITED STATES.
[_] I PLAN TO ATTEND
