SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. _)
Filed by the Registrant |X|
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
CD&L, Inc.
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(Name of Registrant as Specified in Its Charter)
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(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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[GRAPHIC OMITTED]
Dear Stockholder:
On behalf of the Board of Directors, you are cordially invited to attend
the Annual Meeting of Stockholders of CD&L, Inc. (the "Company") to be held at
the Holiday Inn Hotel, 283 Route 17 South, Hasbrouck Heights, New Jersey 07604
on Wednesday, June 6, 2001 at 10:00 a.m.
The enclosed Notice of Meeting and the accompanying Proxy Statement
describe the business to be conducted at the Meeting. Enclosed is a copy of the
Company's 2000 Annual Report on Form 10-K, which contains certain information
regarding the Company and its 2000 results.
It is important that your shares of Common Stock be represented and
voted at the Meeting. Accordingly, regardless of whether you plan to attend in
person, please complete, date, sign and return the enclosed proxy card in the
envelope provided, which requires no postage if mailed in the United States.
Even if you return a signed proxy card, you may still attend the Meeting and
vote your shares in person. Every stockholder's vote is important, whether you
own a few shares or many.
I look forward to seeing you at the Annual Meeting.
Sincerely,
Albert W. Van Ness, Jr.
Chairman of the Board
and Chief Executive Officer
May 16, 2001
South Hackensack, New Jersey
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[GRAPHIC OMITTED]
CD&L, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 6, 2001
The Annual Meeting of Stockholders (the "Meeting") of CD&L, Inc. (the
"Company") will be held at the Holiday Inn Hotel, 283 Route 17 South, Hasbrouck
Heights, New Jersey 07604 on Wednesday, June 6, 2001 at 10:00 a.m., to consider
and act upon the following:
1. The election of directors.
2. Amendment to the CD&L, Inc. Year 2000 Stock Incentive Plan.
3. Ratification of the appointment of Arthur Andersen LLP as the
Company's independent public accountants for 2001.
4. The transaction of such other business as may properly come before
the Meeting or any adjournments or postponements thereof.
Only holders of record of the Company's Common Stock, par value $.001
per share, at the close of business on April 20, 2001 will be entitled to vote
at the Meeting.
BY ORDER OF THE BOARD OF DIRECTORS
Mark Carlesimo
Secretary
May 16, 2001
South Hackensack, New Jersey
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, MANAGEMENT URGES YOU TO
DATE, SIGN AND MAIL THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED
ENVELOPE. YOU MAY REVOKE THE PROXY AT ANY TIME PRIOR TO ITS EXERCISE.
[GRAPHIC OMITTED]
CD&L, Inc.
80 Wesley Street
South Hackensack, New Jersey 07606
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ANNUAL MEETING OF STOCKHOLDERS
JUNE 6, 2001
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PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors of CD&L, Inc.
(the "Company") for use at the Annual Meeting of Stockholders to be held at the
Holiday Inn Hotel, 283 Route 17 South, Hasbrouck Heights, New Jersey 07604 on
Wednesday, June 6, 2001 at 10:00 a.m., and at any adjournments or postponements
thereof (the "Meeting"). A stockholder who has voted by proxy has the right to
revoke it by giving written notice of such revocation to the Secretary of the
Company at any time before it is voted, by submitting to the Company a duly
executed, later-dated proxy or by voting the shares subject to such proxy by
written ballot at the Meeting. The presence at the Meeting of a stockholder who
has given a proxy does not revoke such proxy unless such stockholder files the
aforementioned notice of revocation or votes by written ballot.
The proxy statement and the enclosed form of proxy are first being
mailed to stockholders on or about May 16, 2001. All shares represented by valid
proxies pursuant to this solicitation (and not revoked before they are
exercised) will be voted as specified in the proxy. If a proxy is signed but no
specification is given, the shares will be voted "FOR" Proposals 1, 2 and 3 ((1)
to elect the Board's nominees to the Board of Directors, (2) to approve the
amendment to CD&L, Inc.'s Year 2000 Stock Incentive Plan, and (3) to ratify the
appointment of Arthur Andersen LLP as the Company's independent public
accountants for 2001).
The entire cost of soliciting these proxies will be borne by the
Company. The solicitation of proxies may be made by directors, officers and
regular employees of the Company or any of its subsidiaries by mail, telephone,
facsimile or telegraph or in person without additional compensation payable with
respect thereto. Arrangements will be made with brokerage houses and other
custodians, nominees and fiduciaries to forward proxy soliciting material to the
beneficial owners of stock held of record by such persons, and the Company will
reimburse them for reasonable out-of-pocket expenses incurred by them in so
doing.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
At April 20, 2001 (the "Record Date"), the Company had outstanding
7,658,660 shares of common stock, par value $.001 per share ("Common Stock").
Each holder of Common Stock will have the right to one vote for each share
standing in such holder's name on the books of the Company as of the close of
business on the Record Date with respect to each of the matters considered at
the Meeting. There is no right to cumulate votes in the election of directors.
Holders of the Common Stock will not have any dissenters' rights of appraisal in
connection with any of the matters to be voted on at the Meeting.
The presence in person or by proxy of the holders of shares entitled to
cast a majority of the votes of all shares entitled to vote will constitute a
quorum for purposes of conducting business at the Meeting. Assuming that a
quorum is present, directors will be elected by a plurality vote. The
ratification of all other proposals will require the affirmative vote of a
majority of the shares present and entitled to vote with respect to such
proposal. Pursuant to Delaware corporate law, abstentions and broker non-votes
will be counted for the purpose of determining whether a quorum is present and
do not have an effect on the election of directors. Abstentions, but not broker
non-votes, are treated as shares present and entitled to vote, and will be
counted as a "no" vote. Broker non-votes are treated as not entitled to vote,
and so reduce the absolute number, but not the percentage of votes needed for
approval of a matter.
Based upon information available to the Company, the following
stockholders beneficially owned more than 5% of the Common Stock as of April 20,
2001.
NAME AND ADDRESS NUMBER OF SHARES PERCENT OF
OF BENEFICIAL OWNER BENEFICIALLY OWNED CLASS
------------------- ------------------ ----------
Albert W. Van Ness, Jr. 726,974(1) 8.8%
80 Wesley Street
South Hackensack, New Jersey
07606
Thomas LoPresti 638,708(2) 8.7%
24-30 Skillman Avenue
Long Island City, New York
11101
William T. Beaury 638,708(2) 8.7%
3 Fairway Court
Upper Bronxville, New York
11771
Vincent Brana 368,839(3) 5.0%
80 Wesley Street
South Hackensack, New Jersey
07606
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(1) Includes 647,814 shares of Common Stock issuable upon the exercise of
options pursuant to the Employee Stock Compensation Program which are
exercisable within 60 days of April 20, 2001.
(2) Includes 638,708 shares of Common Stock held by a company which is jointly
owned by Mr. Beaury and Mr. LoPresti, each of whom may be deemed to be the
beneficial owner of all of such shares.
(3) Includes 11,538 shares of Common Stock issuable upon the exercise of
options pursuant to the Employee Stock Compensation Program which are
exercisable within 60 days of April 20, 2001.
-2-
ELECTION OF DIRECTORS
In accordance with the Company's Second Restated Certificate of
Incorporation and By-laws, the number of directors of the Company has been set
at nine. The By-Laws of the Company divide the Board into three classes and
create staggered three year terms for the members of each class to serve. At
each annual meeting, directors are elected to fill the directorship of the class
of directors whose terms have expired. Those directors shall hold office until
the third successive annual meeting after their election and until their
successors have been elected and qualified so that the term of office of one
class of directors expires at each annual meeting.
The current members of the Board of Directors of the Company are as
follows:
Class I (Term to expire in 2002) - Albert W. Van Ness, Jr., Thomas E.
Durkin III, and John A. Simourian.
Class II (Term to expire in 2003) - Jon F. Hanson, Michael Brooks, and
Matthew J. Morahan.
Class III (Term to expire in 2001) - Marilu Marshall, William T. Brannan
and John S. Wehrle.
All persons named herein as nominees for director, William T. Brannan,
Marilu Marshall and John S. Wehrle, have consented to serve, and it is not
contemplated that any nominee will be unable to serve as a director. However, if
a nominee is unable to serve as a director, a substitute will be selected by the
Board of Directors and all proxies eligible to be voted for the Board's nominees
will be voted for such other person.
The following individuals are nominated at this Annual Meeting of
Shareholders to serve as Class III directors with a term to expire in 2004:
William T. Brannan, Marilu Marshall and John S. Wehrle.
Set forth below for each nominee and for each director whose term
continues beyond this Meeting, is his name, age, the year in which he became a
director of the Company, his principal occupations during the last five years
and any additional directorships in publicly-held companies. The information is
as of March 31, 2001.
Nominees
Class III
William T. Brannan, 52, Director since 1994. President and Chief
Operating Officer of the Company since November 1994. From January 1991 until
October 1994, Mr. Brannan served as President, Americas Region - US Operations,
for TNT Express Worldwide, a major European-based overnight express delivery
company. Mr. Brannan has 25 years of experience in the transportation and
logistics industry.
Marilu Marshall, 55, Director since 1997. Vice President Human Resources
- North America for Estee Lauder Co. Inc. since October 1998. From November 1987
until September 1998, Ms. Marshall served as Senior Vice-President and General
Counsel for Cunard Line Limited. Prior thereto, from July 1984 to September 1987
Ms. Marshall served as the Vice-President and General Counsel of GNOC, Corp.,
t/a Golden Nugget Hotel & Casino.
John S. Wehrle, 48, Director since 1997. Managing Director of Gryphon
Holdings, L.P. since January 1999. From August 1997 to December 1998, Mr. Wehrle
served as President and CEO of Heartland Capital Partners, L.P. Prior thereto,
Mr. Wehrle served as Vice President and Head of Mergers & Acquisitions for A.G.
Edwards & Sons, Inc. from July 1994 to July 1997. From 1989 to 1994 Mr. Wehrle
served as Vice President-Financial Planning for The Dyson-Kissner-Moran
Corporation where he was a key participant in acquisitions and corporate
development. He also served as Managing Director of Chase Manhattan Bank, N.A.
for three years from August 1986 to October 1989 where he was engaged in the
execution of Leveraged Acquisitions. From 1976 to 1986 Mr. Wehrle held various
positions with both Price Waterhouse and Touche Ross & Co. in both New York and
London.
-3-
Continuing Directors
Michael Brooks, 46, Director since 1995. Mr. Brooks has served as the
Southeast Region Manager of the Company since August 1996 and President of
Silver Star Express, Inc. ("Silver Star"), a subsidiary of the Company, since
1995. Prior to the merger of Silver Star Express, Inc. into the Company, Mr.
Brooks was President of Silver Star Express, Inc. since 1988. Mr. Brooks has 25
years of experience in the same-day ground and distribution industries. In
addition, Mr. Brooks is currently a Director of the Express Carriers
Association, an associate member of the National Small Shipment Traffic
Conference and an affiliate of the American Transportation Association.
Thomas E. Durkin III, 47, Director since 1999. Since January 2000, Mr.
Durkin has served as a consultant to Waste Management Inc., a multibillion
dollar publicly held international solid waste management company, and has
returned as a partner to Durkin & Durkin, a New Jersey based law firm, with whom
Mr. Durkin practiced as a partner from September 1978 until September 1997. From
October 1997 through December 1999, Mr. Durkin served as area Vice President of
Business Development of Waste Management Inc. In addition Mr. Durkin has served
as a partner of two privately held real estate brokerage companies. Mr. Durkin
graduated from Fordham University in 1975 and graduated Cum Laude from Seton
Hall University School of Law in 1978.
Jon F. Hanson, 64, Director since 1997. Mr. Hanson has served as the
President and Chairman of Hampshire Management Company, a real estate investment
firm since December 1976. From April 1991 to the present, Mr. Hanson has served
as a director to the Prudential Insurance Company of America. In addition, Mr.
Hanson currently serves as a director with the United Water Resources and the
Orange and Rockland Utilities from April 1985 and September 1995, respectively.
Matthew Morahan, 51, Director since 2000. Mr. Morahan has been a private
investor since 1997. From 1994 until 1997, Mr. Morahan served as Executive Vice
President of the Macro Hedge Fund of Summit Capitol Advisors LLC. Prior thereto,
Mr. Morahan served as Managing Director of the High Yield Department of Paine
Webber Group from 1991 to 1994. From 1976 to 1990, he served as Partner and
Managing Director of Wertheim & Co. Mr. Morahan served as Vice President of the
Corporate Bond Department for Hornblower & Weeks, Hemphill, Noyes & Co. from
1971 to 1976.
John A. Simourian, 65, Director since 1999. Mr. Simourian has served as
Chairman of the Board and Chief Executive Officer of Lily Transportation Corp.
("Lily"), a privately held truck leasing and dedicated logistics company, since
1958 when Mr. Simourian founded Lily. Lily currently employs approximately 750
employees and leases and or operates 4,000 vehicles out of 27 locations from New
England to North Carolina. Mr. Simourian attended Harvard University where he
received his undergraduate degree in 1957 and his graduate degree from the
Harvard Business School in 1961. In 1982 Mr. Simourian was elected to the
Harvard University Hall of Fame. Mr. Simourian also served in the United States
Navy from 1957 to 1959.
Albert W. Van Ness, Jr., 58, Director since 1995. Since February 1997
Mr. Van Ness has served as Chairman of the Board and Chief Executive Officer of
the Company and, from May 1998 to November 1999, he served as acting Chief
Financial Officer. Mr. Van Ness remains a Managing Partner of Club Quarters,
LLC, a hotel development and management company, a position he has held since
October 1992. From June 1990 until October 1992, Mr. Van Ness served as Director
of Managing People Productivity, a consulting firm. Prior thereto, from 1982
until June 1990, Mr. Van Ness held various executive offices with Cunard Line
Limited, a passenger ship and luxury hotel company, including Executive Vice
President and Chief Operating Officer of the Cunard Leisure Division and
Managing Director and President of the Hotels and Resorts Division. Prior
thereto, Mr. Van Ness served as the President of Seatrain Intermodal Services,
Inc., a cargo shipping company. Mr. Van Ness holds a Ph.D. in economics from
Syracuse University.
-4-
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR DIRECTOR
DESCRIBED ABOVE.
PROPOSAL TWO
APPROVAL OF THE AMENDMENT TO CD&L, INC.
YEAR 2000 STOCK INCENTIVE PLAN
In February and June 2000 respectively, the Board of Directors and the
shareholders of the Company approved the Company's Year 2000 Stock Incentive
Plan (the "2000 Plan"). The 2000 Plan supplemented the Company's existing
Employee Stock Compensation Program (the "1995 Plan") in facilitating
performance based compensation for key employees, providing incentives for
participants in the Plan to enhance the value of the stock, and attracting and
retaining qualified officers, employees and consultants of the Company. On
February 28, 2001, the Board of Directors adopted an amendment to the 2000 Plan,
subject to shareholder approval. The 2000 Plan initially reserved 1,350,000
shares of the Company's Common Stock for issuance thereunder pursuant to stock
options and other incentives. The Board of Directors approved an amendment to
the 2000 Plan to increase the number of shares available for award by an
additional 375,000 shares, for a total of 1,725,000 shares. As of February 28,
2001, there were 1,066,880 shares available for grant of new options under the
2000 Plan and prior stock option plan. Approval of the amendment to the 2000
Plan is intended to ensure that the Company can continue to provide stock
options and other performance incentives at levels determined appropriate by the
Board of Directors. No change to the Plan other than the number of shares
available for grant is being proposed. The following is a brief description of
the 2000 Plan.
Purpose.
The purpose of the 2000 Plan is to provide long-term incentives to
select employees, officers and consultants of the Company and its subsidiaries
to encourage them to devote their abilities and industry to the success of the
Company.
Shares and Incentives Available Under the 2000 Plan.
The 2000 Plan provides for grants of stock options, restricted stock and
performance awards. An aggregate of 1,350,000 shares of Common Stock are
presently authorized for issuance under the 2000 Plan, which amount will be
proportionately adjusted in the event of certain changes in the Company's
capitalization, a merger, or a similar transaction. Upon the approval of the
proposed amendment by the shareholders, an additional 375,000 shares will be
authorized for issuance under the 2000 Plan, for an aggregate of 1,725,000
shares. Such shares may be treasury shares or newly issued shares or a
combination thereof. As of May 9, 2001, the closing sale price per share of the
Common Stock on the American Stock Exchange was $0.47.
Eligibility.
The persons eligible to receive awards under the 2000 Plan are those
persons who are, or who have agreed to become, officers or employees of, or
consultants or advisers to, the Company or any of its subsidiaries. The Company
estimates that, as of April 1, 2001, there were approximately 130 individuals
eligible to participate in the 2000 Plan. As discretion for the grant of options
and awards is in the Plan Committee, the Company is unable to determine the
identity or number of officers, consultants, advisors and other employees who
may be granted options or awards under the 2000 Plan in the future.
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Determination of Eligibility; Administration of the 2000 Plan.
The 2000 Plan is administered by a committee (the "Plan Committee")
appointed by the Board of Directors. The Plan Committee must consist of at least
two outside directors of the Company. The 2000 Plan provides that the Plan
Committee has full discretion and authority to (i) select eligible persons to
receive awards, (ii) determine the type, number, and terms and conditions of
awards to be granted and the number of shares of Common Stock to which awards
will relate, (iii) specify times at which awards may be exercised or settled
(including associated performance conditions), set other terms and conditions of
awards, and prescribe forms of award agreements, (iv) construe, interpret and
specify rules and regulations relating to the 2000 Plan and (v) make all other
determinations that may be necessary or advisable for the administration of the
2000 Plan.
Any action of the Plan Committee is final, conclusive and binding on all
parties, including the Company, its stockholders and its employees. The 2000
Plan provides that members of the Plan Committee will not be liable for any act
or determination taken or made in good faith in their capacities as such members
and will be fully indemnified by the Company with respect to such acts and
determinations.
Types of Awards:
Stock Options. The Plan Committee is authorized to grant stock options
to employees of the Company or any of its Subsidiaries or to consultants and
advisors of the Company or any of its Subsidiaries who receive cash compensation
from the Company. The Plan Committee may grant incentive stock options ("ISOs"),
as defined under Section 422 of the Internal Revenue Code (the "Code"), which
can result in potentially favorable tax treatment, only to employees, and
non-qualified stock options.
The terms and conditions of grants of stock options granted under the
2000 Plan shall be set forth in a written agreement (the "Option Agreement").
The purchase price per share subject to an ISO shall not be less than
the fair market value of a share of Common Stock on the date of grant, except
that it shalll be 110% of the fair market value on the date of grant with
respect to ISO grants to a 10% stockholder. The purchase price per share subject
to a non-qualified stock option may be less than the fair market value of a
share of Common Stock on the date of grant. If options are granted with exercise
prices below fair market value, however, deductions for compensation
attributable to the exercise of such options could be limited by Code Section
162(m). See "-- Federal Income Tax Consequences." The term "fair market value"
on any date means the closing sales price per share on such date on the American
Stock Exchange. Unless otherwise provided in the applicable Option Agreement, if
the purchase price of an option is paid with previously owned shares, a new
option exercisable for the number of those shares will be granted with an
exercise price equal to the fair market value of a share of Common Stock on the
date of exercise of the first option, exercisable six months after the date of
grant, and terminating on the same date as the original option. The aggregate
fair market value, determined at the time of grant, of the shares of Common
Stock with respect to which ISOs are exercisable for the first time by an
optionee during any calendar year may not exceed $100,000.
The maximum term of each option, the times at which each option will be
exercisable, and the vesting schedule, if any, associated with a stock option
grant generally are fixed by the Committee, except that no option may have a
term exceeding ten years, or five years in the case of an ISO granted to a 10%
stockholder. Unless otherwise provided in the Option Agreement or accelerated as
a result of a "change in control" (see "-- Acceleration of Vesting; Change in
Control"), options will become fully vested and exercisable with respect to 25%
of the underlying shares of Common Stock on each anniversary of the date of
grant, provided that the optionee continues to be employed by or is otherwise in
the service of the Company on such anniversary date.
Options may be exercised by providing written notice to the Secretary of
the Company, specifying the number of shares to be purchased and accompanied by
payment for such shares, and otherwise in accordance with the applicable Option
Agreement. Payment may be made, in the discretion of the Plan Committee, in
cash, other shares of Common Stock or through cashless exercise procedures
approved by the Plan Committee.
-6-
Restricted Stock. The Plan Committee is authorized to grant awards of
restricted stock to employees and consultants. A restricted stock award is a
grant of shares of Common Stock which may not be sold or disposed of, and which
may be forfeited in the event of certain terminations of employment, until the
restrictions specified by the Plan Committee lapse. An individual granted
restricted stock generally has all of the rights of a stockholder of the Company
unless the Plan Committee determines otherwise. The Plan Committee may modify
outstanding awards of restricted stock provided that the modification does not
adversely alter or impair the holder's rights or obligations under the award
without his or her consent. The Plan Committee also has the discretion to
determine how dividends related to shares of restricted stock will be paid. When
the restrictions imposed on an award lapse, the Plan Committee will deliver a
stock certificate for the shares, free of any restrictions, to the individual.
Performance Awards, Including Performance Unit and Performance Shares
Awards. The Plan Committee may also grant a performance award of shares of
Common Stock or units, subject to the satisfaction of performance conditions
(including subjective individual goals) established by the Committee. These
performance conditions shall be expressed in terms of (i) earnings per share,
(ii) target price per share of Common Stock, (iii) pre-tax profits, (iv) net
earnings, (v) return on equity or assets, (vi) revenues, (vii) earnings before
income taxes, interest, depreciation or amortization, (viii) market share or
market penetration or (ix) any combination of these conditions. These awards
shall entitle the holder who satisfies the performance conditions to receive
payment, either in shares of Common Stock or in cash, of the fair market value
of a share of Common Stock at the time specified in the award.
The Plan Committee determines the terms and conditions of performance
awards, including the required levels of performance with respect to specified
business criteria, the corresponding amounts payable upon achievement of the
specified levels of performance, any termination and forfeiture provisions and
the form of payment, including the treatment of dividends. An individual granted
shares of Common Stock through a performance award generally has all of the
rights of a stockholder of the Company unless the Committee determines
otherwise. When restrictions imposed upon shares of Common Stock subject to a
performance award lapse, the Plan Committee will deliver a stock certificate for
such shares, free of any restrictions, to the individual.
Transferability of Awards.
Grants of stock options and other awards are generally not transferable
except by will or by the laws of descent and distribution, or to a designated
beneficiary upon the participant's death, except that the Committee may, in its
discretion, permit transfers for estate planning or other purposes subject to
any applicable restrictions under federal securities laws.
Award Limitations.
The maximum number of shares of Common Stock that an individual may
receive may not exceed 300,000 shares. The maximum amount of cash that any
individual may receive in respect of performance units denominated in dollars
may not exceed $1,000,000.
Acceleration of Vesting; Change in Control.
The Committee may, in its discretion, accelerate the exercisability, the
lapsing of restrictions, or the expiration of deferral or vesting periods of any
award or grant. Vesting will occur automatically in the case of a "change in
control" of the Company, as defined briefly below, with respect to all
outstanding options on the date of a change in control. In addition, the Plan
Committee may provide in an Option Agreement that an optionee may surrender an
option and receive a cash payment in an amount equal to the excess, if any, of
the fair market value of the shares of Common Stock subject to the option over
its exercise price. If, following a change in control, the service of an
employee terminates, each option that was exercisable on the date of termination
will remain exercisable until the expiration of the option's term or the first
anniversary of termination, whichever comes first. In addition, unless the Plan
Committee has otherwise provided, any restrictions applicable to awards of
restricted stock and shares of Common Stock related to performance awards, will
lapse upon a change in control. In the discretion of the Committee, awards of
performance units may also contain provisions which accelerate vesting in the
event of a change in control.
-7-
A change in control includes the acquisition by a "person" with the
meaning of Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended, of beneficial ownership of at least 30% the outstanding Common Stock or
the combined voting power of the Company's then outstanding voting securities. A
change in control also occurs when the current members of the Board of Directors
cease for any reason to constitute a majority of the members of the Board of
Directors (subject to certain exceptions). The consummation of (i) a merger,
consolidation or reorganization with or into the Company or in which the
securities of the Company are issued, which merger, consolidation or
reorganization does not constitute a "Non-Control Transaction" (as defined in
the 2000 Plan); (ii) a complete liquidation or dissolution of the Company or
(iii) the sale or other disposition of all or substantially all of the assets of
the Company each constitute a change in control.
The 2000 Plan also provides that if an employee or consultant is
terminated without cause before a change in control but the termination was
either at the request of a party interested in acquiring the Company or arose in
connection with or in anticipation of a change in control, the vesting rules
described above will apply to that individual. For this purpose, "cause"
generally means, unless otherwise provided in the agreement evidencing an award
or option, intentional failure to perform assigned duties, dishonesty or willful
misconduct, involvement in a transaction for personal profit which is adverse to
the interests of the Company or any of its subsidiaries, or willful violation of
laws and regulations.
Effect of Termination of Employment.
Except as otherwise provided in the agreement evidencing an award or
option, (a) in the event that a participant's employment or service with the
Company is terminated for "cause" (as defined above), any outstanding options
and awards of such participant will immediately be forfeited; (b) in the event
that a participant's employment or service with the Company terminates due to
death or disability, all options of such participant will lapse unless
exercised, to the extent exercisable at the date of termination, within one year
following such date of termination, and all performance awards for which all
performance objectives and conditions have been achieved and satisfied (other
than conditions based solely on the passage of time) shall be paid in full (any
remaining awards of such participant will be forfeited); and (c) in the event
that a participant's employment or service with the Company terminates for any
other reason, all options of such participant will lapse unless exercised, to
the extent exercisable at the date of termination, within the earlier of ninety
days following such date of termination or the expiration date of such options,
and all performance awards for which all performance objectives and conditions
have been achieved and satisfied (other than conditions based solely on the
passage of time) shall be paid in full (any remaining awards of such participant
will be forfeited).
Amendment, Suspension or Termination of the 2000 Plan.
The 2000 Plan will terminate on the day preceding the tenth anniversary
of its adoption. Prior to that date, the Board of Directors may amend, modify,
suspend or terminate the Plan, subject to stockholder approval when required by
law. No amendment, modification, suspension or termination may adversely affect
the rights of participants, without their consent, under any outstanding awards
or grants of options.
Federal Income Tax Consequences of Options and Awards.
The following is a brief description of the federal income tax
consequences generally arising with respect to the grant of Options and Awards
pursuant to the 2000 Plan. This summary is based on the Code, regulations,
rulings and decisions now in effect, all of which are subject to change by
legislation, administrative action or judicial decision. This discussion is
intended for the information of stockholders considering how to vote at the
Annual Meeting and not as tax guidance to individuals who participate in the
2000 Plan.
-8-
ISOs. In general, an optionee granted an ISO will not recognize taxable
income upon the grant or the exercise of the ISO. The excess of the fair market
value of shares of Common Stock received upon exercise of the ISO over the
exercise price is, however, a tax preference item which can result in imposition
of the alternative minimum tax. The optionee's "tax basis" in the shares of
Common Stock acquired upon exercise of the ISO generally will be equal to the
exercise price paid by the optionee, except in the case in which the optionee
pays the exercise price by delivery of the shares of Common Stock otherwise
owned by the optionee (as discussed below).
If the shares acquired upon the exercise of an ISO are held by the
optionee for the "ISO holding period" of at least two years after the date of
grant and one year after the date of exercise, the optionee will recognize
long-term capital gain or loss upon the sale of the ISO Shares equal to the
amount realized upon such sale minus the optionee's tax basis in the shares, and
such optionee will not recognize any taxable ordinary income with respect to the
ISO. As a general rule, if an optionee disposes of the shares acquired upon
exercise of an ISO before satisfying both holding period requirements (a
"disqualifying disposition"), the gain recognized on the disposition will be
taxed as ordinary income equal to the lesser of (i) the fair market value of the
shares at the date of exercise of the ISO minus the optionee's tax basis in the
shares, or (ii) the amount realized upon the disposition minus the optionee's
tax basis in the shares. Any gain in excess of the amount realized as ordinary
income is capital gain. Certain transactions are not considered disqualifying
dispositions including certain exchanges, transfers resulting from the
optionee's death, and pledges and hypothecations of ISO Shares.
Non-qualified stock options. In general, an optionee granted a
non-qualified stock option will not recognize taxable income upon the grant of
the non-qualified stock option. Upon the exercise of the non-qualified stock
option (including an option intended to be an ISO but which has not continued to
so qualify at the time of exercise), the optionee generally will recognize
taxable ordinary income in an amount equal to the fair market value of the
shares at the time of exercise minus the exercise price, and the optionee will
have a tax basis in the shares equal to the fair market value of the shares at
the time of exercise. A subsequent sale of the shares by the optionee generally
will result in short-term or long-term capital gain or loss equal to the sale
price of such shares minus the optionee's tax basis in such shares.
In the event that an optionee forfeits an unexercised ISO or a
non-qualified stock option (or portion of such option), the optionee will not
recognize a loss for federal income tax purposes.
Restricted stock. Because restricted stock will be restricted as to
transferability and subject to a substantial risk of forfeiture for a period of
time after awarded, a participant generally will not be subject to taxation at
the time of such award. The participant generally must recognize ordinary income
equal to the fair market value of the shares at the first time the restricted
stock becomes transferable or not subject to a substantial risk of forfeiture. A
participant may, however, elect to be taxed at the time of award of restricted
stock rather than upon lapse of the restriction on transferability or
substantial risk of forfeiture. If a participant makes such an election but
subsequently forfeits the restricted stock, he or she would not be entitled to
any tax deduction, including a capital loss, for the value of the shares on
which he or she previously paid tax.
Performance Awards. In general, participants will not realize taxable
income at the time of the grant of such an Award. Participants will be subject
to tax at ordinary income rates on the value of such Awards when payment is
received. If, however, an Award is structured to permit a participant to
postpone payment, the participant becomes taxable at ordinary income rates when
payment is made available or the Award is no longer subject to a substantial
risk of forfeiture. If the Award is paid in shares, taxable income will be the
fair market value of the shares either at the time the Award is made available
or at the time any restrictions (including restrictions under Section 16b of the
Exchange Act) subsequently lapse.
Compensation Deduction Limitation. Code Section 162(m) generally
disallows a public company's tax deduction for compensation paid to the Chief
Executive Officer, or to the other four most highly compensated officers, in
excess of $1.0 million in any tax year. Compensation that qualifies as
"performance-based compensation" is excluded from the $1.0 million deductibility
cap, if various requirements are satisfied. The Company intends that options
(other than non-qualified stock options with respect to which the exercise price
is less than the fair market value of the shares subject to such options on the
date of grant) and certain other Awards granted to employees whom the Committee
expects to be covered employees at the time a deduction arises in connection
with such Awards, qualify as "performance-based compensation," so that such
Awards will not be subject to the deductibility cap.
-9-
Withholding. The Company has the right to deduct from all Awards paid in
cash or from other wages paid to an employee of the Company, any federal, state,
or local taxes required by law to be withheld with respect to Awards, and the
employee or other person receiving shares under the 2000 Plan will be required
to pay to the Company the amount of any such taxes which the Company is required
to withhold with respect to such shares.
The affirmative vote of a majority of the votes cast at the meeting by
the stockholders entitled to vote thereat is required to adopt this proposal.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
AMENDMENT TO THE COMPANY'S YEAR 2000 STOCK INCENTIVE PLAN.
BOARD ORGANIZATION AND MEETINGS
During the year ended December 31, 2000, the Board of Directors held
seven meetings. During 2000, all members of the Board of Directors attended at
least 75% of all meetings of the Board of Directors and committees of the Board
of Directors of which such director was a member. During 2000 there were four
standing committees of the Board of Directors. Each of the Committees is
described below.
Audit Committee. During 2000, the Audit Committee met three times. The
Audit Committee is comprised of Mr. Wehrle, Chairman, Mr. Hanson, Mr. Simourian
and Mr. Durkin. The Audit Committee makes recommendations to the Board of
Directors with respect to the selection of the independent auditors of the
Company's financial statements, reviews the scope of the annual audit and meets
periodically with the Company's independent auditors to review their findings
and recommendations, reviews quarterly financial information and earnings
releases prior to public dissemination, and periodically reviews the Company's
adequacy of internal accounting controls.
Compensation Committee. During 2000, the Compensation Committee met four
times. The Compensation Committee is comprised of Ms. Marshall, Chairperson, Mr.
Wehrle, Mr. Morahan, and Mr. Durkin. The Compensation Committee periodically
reviews and determines the amount and form of compensation and benefits payable
to the Company's principal executive officers and certain other management
personnel. The Compensation Committee also administers the Company's stock
option plans and certain of the Company's other employee benefit plans.
Nominating Committee. During 2000, the Nominating Committee met once.
The Nominating Committee was formed in February 1997 and is comprised of Messrs.
Van Ness, Chairman, Durkin and Hanson. The Nominating Committee recommends
nominations for outside directors, considers candidates for director vacancies
and other such management matters presented to it by the Board of Directors. The
Nominating Committee will consider appropriate persons recommended by
stockholders for election to the Board of Directors. Stockholders wishing to
submit such recommendations may do so by sending a written notice to the
Secretary of the Company together with supporting information a reasonable
period of time prior to the mailing of the Company's Proxy Statement for the
related Annual Meeting.
-10-
COMPENSATION OF DIRECTORS
Directors who are employees of the Company do not receive additional
compensation for serving as directors. Effective in 1997, each director who is
not an employee of the Company received an annual retainer of $16,000 ($18,000
for any committee chairperson). The total directors fees earned by non-employee
directors in 2000 was $93,000. Directors of the Company are reimbursed for
out-of-pocket expenses incurred in their capacity as directors of the Company.
Non-employee directors also receive stock options under the Company's 1995 Stock
Option Plan.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of April 20, 2001 with
respect to beneficial ownership of the Common Stock by (i) each director, (ii)
each executive named in the Summary Compensation Table (the "Named Executives")
and (iii) all executive officers and directors as a group. Unless otherwise
indicated, the address of each such person is c/o CD&L, Inc., 80 Wesley Street,
South Hackensack, New Jersey 07606. All persons listed have sole voting and
investment power with respect to their shares unless otherwise indicated.
Amount of Beneficial Ownership (1)
Shares
Issuable
Upon Exercise
of Stock Total Percentage
Name Shares of Options (1) Shares Owned
---- ------ -------------- ------ ----------
Albert W. Van Ness, Jr. 76,160 647,814 726,974 8.8%
William T. Brannan 113,796 185,666 299,462 3.8
Michael Brooks 251,955(2) 129,961 381,916 4.9
Thomas E. Durkin III - 10,000 10,000 *
John F. Hanson 59,000(3) 18,750 77,750 *
Marilu Marshall - 18,750 18,750 *
Matthew J. Morahan 131,308 5,000 136,308 1.8
John A. Simourian - 10,000 10,000 *
John S. Wehrle - 17,500 17,500 *
Randall Catlin(4) 112,317(1) 100,000 222,317 2.9
Russell Reardon 30,117 108,750 138,867 1.8
All executive
officers and
directors as a
group (13
persons) 839,141 1,313,072 2,152,213 24.0%
------------
* Less than 1%
(1) Includes options granted pursuant to the Employee Stock Compensation Program
and the Director Plan, which are exercisable within 60 days of April 20,
2001.
(2) Includes 3,500 shares held by Mr. Brooks' wife.
(3) Represents 59,000 shares held by Ledgewood Employees Retirement Plan of
which Mr. Hanson is a beneficiary.
(4) As of the date of this Annual Report, Mr. Catlin is no longer an executive
officer of the Company. His employment with the Company was terminated in
connection with the sale of certain assets of the Company's subsidiary
Sureway Air Traffic Corporation.
-11-
EXECUTIVE COMPENSATION
The following table summarizes certain information relating to
compensation for services rendered during the years ended December 31, 1998,
1999 and 2000 to each person serving as the Chief Executive Officer of the
Company and each of the Company's four other most highly paid executive officers
whose compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
Long-Term
Compensation
Annual Compensation Awards (1)
-------------------------------------- ----------------------
Other Securities
Annual Restricted Underlying
Compen- Stock Options/ All Other
Name and Salary Bonus sation Awards SARs Compensation
Principal Position Year ($) ($) ($)(2) ($) (3) ($)
------------------ ---- --- --- ------ ---------- ---------- ------------
Albert W. Van Ness, Jr. 2000 280,198 75,000(4) - - 25,000 -
Chairman and Chief 1999 150,000 75,000 - 150,000(5) 67,229 -
Executive Officer 1998 125,000 - - - 220,000 -
William T. Brannan 2000 241,760 10,000 - - 150,000 -
President and Chief 1999 224,658 48,621 - - 40,000 -
Operating Officer 1998 215,000 96,750 - - - -
Michael Brooks 2000 193,454 10,380 - - 150,000 -
Distribution Group 1999 175,005 30,438 - - 28,000 -
President 1998 166,333 12,540 - - 2,000 -
Randall Catlin 2000 193,288 6,560 - - 150,000 -
Air Division 1999 196,671 22,160 - - 28,000 -
President (6) 1998 185,546 - - - - -
Russell Reardon (7) 2000 167,231 5,975 - - 150,000 -
Chief Executive 1999 120,085 15,675 - - 27,500 -
Officer 1998 - - - - - -
John Ovens (8) 2000 198,333 - - - 150,000 -
Courier Division 1999 41,300 900 - - 15,000 -
President 1998 - - - - - -
-----------------
(1) The Company did not grant any stock appreciation rights or make any
long-term incentive plan pay-out during the years ended December 31, 1998,
1999 and 2000.
(2) Excludes certain personal benefits, the total value of which was less than
the lesser of either $50,000 or 10% of the total annual salary and bonus for
each of the executives.
(3) Comprised solely of incentive or non-qualified stock options. See "Stock
Option Plans - Employee Stock Compensation Program and Year 2000 Stock
Incentive Plan."
(4) Additional bonus earned for extension of his employment agreement.
(5) The restricted stock award of 47,051 shares of the Company's Common stock
was made on April 9, 1999 under the Company's Employee Stock Compensation
Program and is not subject to forfeiture.
(6) Mr. Catlin's employment with the Company was terminated in connection with
the sale of certain assets of the Company's subsidiary Sureway Air Traffic
Corporation on March 30, 2001.
(7) Mr. Reardon joined the Company on January 4, 1999.
(8) Mr. Ovens joined the Company on October 1, 1999 and terminated his
employment on December 15, 2000.
-12-
Employment Agreements; Covenants-Not-To-Compete
Effective as of January 5, 2000, Mr. Van Ness entered into an employment
agreement with the Company (the "2000 Agreement") commencing upon termination of
the employment agreement with the Company entered into on January 4, 1999. In
January 2001, certain terms of the 2000 Agreement were modified by an Amendatory
Agreement. The 2000 Agreement as amended provides for an annual salary of
$325,000 from January 5, 2001 to January 4, 2002 and $350,000 per year from
January 5, 2002 to the expiration of the 2000 Agreement. In the 2001 Amendment,
Mr. Van Ness agreed to the following reductions in his base salary: a 30%
reduction for the period April 1, 2001 through June 30, 2001; a 40% reduction
for the period July 1, 2001 through September 30, 2001; and a 50% reduction for
the period October 1, 2001 through the expiration of the 2000 Agreement. For the
period January 1, 2001 to June 30, 2001, Mr. Van Ness will serve as the
Company's Chairman of the Board and Chief Executive Officer and/or such other
title/titles as may be agreed upon between Mr. Van Ness and the Company. For the
period July 1, 2001 to the expiration of the 2000 Agreement, Mr. Van Ness agreed
to serve as the Chairman and/or such other title/titles as may be agreed upon
between Mr. Van Ness and the Company, except for the office of Chief Executive
Officer. The 2000 Agreement provided Mr. Van Ness with the right to receive an
annual bonus equal to up to 100% of Mr. Van Ness' then-current base salary based
upon the Company attaining certain targets. The Amendatory Agreement also
provides him with 1% of the net proceeds from the sale of one or more of the
Company's divisions or subsidiaries during the period from January 1, 2001
through the expiration of the 2000 Agreement.
The employment agreement provides that, in the event of a termination of
employment by the Company for any reason other than "cause" or "disability" (as
defined in the 2000 Agreement) or by Mr. Van Ness as a result of a material
breach by the Company, then Mr. Van Ness will be entitled to receive for the
remainder of the term all base salary due, all annual bonuses and all other
benefits and prerequisites. In the event that Mr. Van Ness' employment
terminates within 360 days of a "change in control" (as defined in the 2000
Agreement), Mr. Van Ness will be entitled to receive two times the sum of his
then-current base salary and the highest annual bonus earned by him during his
employment with the Company (subject to certain limitations under the Internal
Revenue Code). Mr. Van Ness' employment agreement is subject to certain
non-competition, non-solicitation and anti-raiding provisions.
Effective as of May 1, 2000 Messrs. Brannan, Brooks, Reardon, Catlin and
Ovens entered into five year employment agreements with the Company. Salaries
for those individuals under the agreement in 2000 were, respectively, $255,000,
$200,000, $160,000, $195,000 and $200,000.
Each agreement contains identical terms and conditions (other than
salary) including covenants against competition and change in control
provisions. The change in control provision provides that if the employment with
the Company is terminated for any reason by either the employee or the Company
within six months following a change in control of the Company, the employee
will be entitled to receive a lump sum payment equal to two (2) times the sum of
employee's then current base salary plus the highest approved bonus payment made
to the employee during his employment with the Company (subject to certain
limitations under the Internal Revenue Code). Each employment agreement also
contains non-competition covenants that will continue for two years following
termination of employment unless termination was by the Company without cause or
by the employee as a result of a breach of the employment agreement by the
Company in which event the covenants against competition will cease upon
termination of employment.
In connection with the termination of their employment, Mr. Ovens
entered into a severance agreement with the Company. Mr. Ovens continues as a
consultant for one year with a minimum payment of $100,000, and 100,000 of his
150,000 stock options were vested. Mr. Ovens also will receive $100,000 if there
is a change in control of the Company during the term of the consulting
agreement. Mr. Catlin was paid a commission payment of $250,000 contingent upon
the sale of Sureway Air Traffic Corporation and 100,000 of his 150,000 stock
options were vested. He will receive an additional commission payment of
$150,000 if there is a change in control within 6 months after the termination
of his employment.
-13-
STOCK OPTION PLANS
Employee Stock Compensation Program and Year 2000 Stock Incentive Plan
In September 1995 and in June 2000, the Board of Directors adopted, and
the stockholders of the Company approved, the Employee Stock Compensation
Program and the Year 2000 Stock Incentive Plan, respectively, (together, the
"Stock Option Plans") in order to attract and retain qualified officers and
employees of the Company, to facilitate performance-based compensation for key
employees and to provide incentives for the participants in the Stock Option
Plans to enhance the value of the Common Stock. The Stock Option Plans are
administered by the Compensation Committee and authorize the granting of
incentive stock options, non-qualified supplementary options, stock appreciation
rights, performance shares and stock bonus awards to key employees of the
Company (approximately 130 in total) including those employees serving as
officers or directors of the Company. The Company has reserved 1,900,000 shares
of Common Stock for issuance in connection with the Employee Stock Compensation
Program and 1,350,000 shares of Common Stock for issuance in connection with the
2000 Plan (with an additional 375,000 shares to be reserved if Proposal Two is
adopted), of which approximately 1,066,880 shares from the plans remain
available for grant. Options granted under the Stock Option Plans have an
exercise price equal to the fair market value of the underlying Common Stock at
the date of grant and vest over a four-year period unless otherwise agreed by
the Compensation Committee of the Board of Directors at the time of grant.
Stock Option Plan for Independent Directors
Outside directors receive options under the Company's 1995 Stock Option
Plan for Independent Directors (the "Director Plan"). The purpose of the
Director Plan is to help the Company attract and retain the most qualified
available individuals to serve as independent directors of the Company and to
encourage the highest level of participation by those persons in the Company's
achievement of its strategic goals. Under the Director Plan, an independent
director is granted an option to purchase 1,250 shares of Common Stock on each
Quarter Date, meaning the first day on which the Common Stock is traded on the
American Stock Exchange in January, April, July and October of each year. The
purchase price per share of Common Stock covered by each option is the fair
market value of a shares of Common Stock on the date the option is granted.
An option granted to an independent director under the Director Plan
becomes fully exercisable as to 100% of the shares of Common Stock covered
thereby one year after the date of grant and may be exercised as to any or all
full shares of Common Stock as to which such option is then exercisable. The
term of each option is ten years from the date of grant. In order to be eligible
to participate in the Director Plan on any Quarter Date, a director must not be
an employee as of such Quarter Date.
The following table summarizes certain information relating to the grant
of stock options to purchase Common Stock to each of the executives named in the
Summary Compensation Table above.
OPTION/SAR GRANTS IN LAST FISCAL YEAR (1)
Individual Grants
----------------------------------------------------------------------------------------------
Percent of
Options/SARs
Granted to Exercise
Securities Employees in or Base Grant Date
Options/SARs Fiscal Year Price Expiration Present
Name Granted(#) (2) ($/sh) Date Value $(3)
---- ---------- ------------- -------- ---------- ----------
Albert W. Van Ness, Jr 25,000 1.9% 3.625 1/5/10 $ 85,975
William T. Brannan 150,000 11.3% 1.813 6/14/10 $261,505
Michael Brooks 150,000 11.3% 1.813 6/14/10 $261,505
Randall Catlin 150,000 11.3% 1.813 6/14/10 $261,505
Russell Reardon 150,000 11.3% 1.813 6/14/10 $261,505
John Ovens 150,000 11.3% 1.813 6/14/10 $261,505
-14-
-------------
(1) The Company did not grant any stock appreciation rights in 2000.
(2) Options covering a total of 1,322,500 shares of Common Stock were granted
under the Employee Stock Compensation Program in 2000.
(3) The present value of the options granted was determined using the
Black-Scholes pricing model and based on the following assumptions: the risk
free interest rate was 6.5%, the expected term of the option was 7 years,
the volatility factor was 140% and the dividend yield was 0.
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES(1)
Number of
Securities Value of
Underlying Unexercised
unexercised In-The-Money
Options/SARs Option/SARs
Shares at FY-End (#) at FY-End ($)(3)
Acquired Value ------------- ----------------
On Exercise Realized Exercisable/ Exerisable/
Name (#)(2) ($)(2) Unexcersable Unexercisable
---- ----------- -------- ------------- ----------------
Albert W. Van Ness, Jr. -- -- 622,814/622,814 -/-
William T. Brannan -- -- 261,166/135,666 -/-
Michael Brooks -- -- 203,461/ 79,961 -/-
Randall Catlin (4) -- -- 204,084/ 81,834 -/-
Russell Reardon -- -- 177,500/ 58,750 -/-
John Ovens (5) -- -- 100,000/100,000 -/-
-------------
(1) No stock appreciation rights have been granted by the Company.
(2) No options were exercised in 2000.
(3) As of December 29, 2000, the fair market value of a share of Common Stock
(presumed to equal the closing sale price as reported on the American Stock
Exchange) was $.437.
(4) Employment terminated on March 30, 2001.
(5) Employment terminated on December 15, 2000.
Employee Stock Purchase Plan
The Company has an employee stock purchase plan ("ESPP") intended to
meet the qualification for such a plan under applicable federal income tax laws.
The Company's ESPP was designed to provide employees of the Company with an
incentive to continue devoting their best efforts to the success of the Company,
and to afford the employees the opportunity to obtain a proprietary interest in
the continued growth and prosperity of the Company by purchasing shares of
Common Stock through payroll deductions. The number of shares available for
purchase under the ESPP as of December 31, 2000 was 121,626 shares of Common
Stock.
During the period when employees are permitted to make purchases, the
purchase price of the shares of Common Stock will be equal to 85% of the lesser
of:
o the per share "Market Price" (as defined in the ESPP) at the close
of the business day prior to the beginning of the Purchase Period
(as defined in the ESPP); or
o the per share Market Price on the last day of the Purchase Period.
In the event of a merger, consolidation or sale of substantially all of
the Company's assets, or other reorganization in which the Company is not the
surviving or acquiring corporation or in which the Company becomes a
wholly-owned subsidiary of another company, the Board of Directors will in good
faith, in its sole discretion seek to have the surviving or acquiring
corporation adopt the ESPP or, to the extent that rights granted under the ESPP
are not deemed to be granted until the last day of the applicable Purchase
Period, to settle the participating employees' rights by payment of cash or
other consideration. If neither can be arranged or if the Company is liquidated
or dissolved (other than pursuant to a sale of assets or other reorganization),
each participant may elect to (a) have the funds previously credited to his
account through payroll deductions applied in whole or in part toward the
purchase of a whole number of shares of Common Stock, or (b) have the funds
previously credited to his account through payroll deductions refunded to him in
cash, without interest.
-15-
SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors,
certain officers and persons holding more than 10% of a registered class of the
Company's equity securities to file with the Securities and Exchange Commission
and to provide the Company with initial reports of ownership, reports of changes
in ownership and annual reports of ownership of Common Stock and other equity
securities of the Company. The initial Form 3 and one Form 4 reporting certain
stock purchases in September 2000 for Mr. Matthew Morahan were filed late in
July 2000 and December 2000 respectively. One Form 4 for Mr. Jon Hanson was
filed late in November 2000 to report certain stock purchases made in August
2000. Based solely upon a review of such reports furnished to the Company by its
directors and executive officers, the Company believes that all other Section
16(a) reporting requirements were timely fulfilled during 2000.
REPORT OF COMPENSATION COMMITTEE
ON EXECUTIVE COMPENSATION
Overview
The Company did not conduct any operations prior to November 1995 when
it acquired 11 companies (the "Subsidiaries") in the same-day and air delivery
and logistics services business (the "Combination"). As part of the Combination,
the Company entered into employment agreements with certain senior officers of
the Subsidiaries. In addition, the Company had previously entered into an
employment agreement with William T. Brannan prior to the Combination. The
employment agreement with Mr. Brannan was the product of arms-length negotiation
between Mr. Brannan and a committee of senior officers of the Subsidiaries.
Accordingly, when the Compensation Committee was formed upon the
consummation of the Company's initial public offering in November 1995, all
executive officers were subject to long-term (generally five year) employment
agreements which fixed the salaries and benefits (including stock options) to be
initially granted. Those contracts expired in 2000, and the Compensation
Committee was concerned during the year about retaining key management on a long
term basis. Mr. Van Ness also had an employment contract that expired in January
2000. Accordingly, the Company entered into new agreements with all key
management during the year.
In approaching new employment agreements for Mr. Van Ness and the other
named executive officers, the Compensation Committee viewed compensation of
executives as having three distinct parts, a current compensation program, a set
of standard benefits and a long-term benefit program. The current compensation
element focuses upon the executive officer's salary and is designed to provide
competitive reimbursement for services rendered. The Company's standard benefit
package consists primarily of health insurance benefits and eligibility for
annual bonuses based upon performance. The long-term benefit element is
reflected in the grants of stock options. During 2000, the Compensation
Committee also approved the adoption of the Year 2000 Stock Incentive Plan to
make options for an additional 1,350,000 shares available for grant to ensure
that the Company could continue to provide stock options at levels at
appropriate levels to incentivize officers and other key employees.
-16-
Base Salary
Base salaries for the five highest paid executive officers of the
Company for 2000 ranged from $167,000 to $280,000. Under the new employment
agreements, base pay was established at levels that were considered appropriate
to retain the Company's experienced management team and to be at competitive
levels. While base pay is important, the Company's compensation package also
attempts to place significant emphasis on other areas of compensation. Executive
officers understand that significant opportunities for substantial compensation
lay in annual bonus compensation and appreciation in the value of stock options.
Annual Incentive Plan
The incentive plan is designed to provide current compensation to
selected key employees who contribute in a substantial degree to the success of
the Company. Pursuant to the plan, executives selected by the Compensation
Committee (with the advice of the Chief Executive Officer) are entitled to cash
bonuses in the event that the Company achieves certain performance targets based
upon sales volume, levels of responsibility and goals. In addition, the Chief
Executive Officer is entitled under his employment contract to a bonus based on
performance goals set with the Compensation Committee. Mr. Van Ness did not earn
a bonus for performance in 2000. The other named executives earned modest
bonuses ranging from $5,975 to $10,380 for the year.
Long-Term Incentive Plan
A shareholder-approved long-term incentive plan consisting of the grant
of stock options to key employees under the Company's 1995 Employee Stock
Compensation Program and the Year 2000 Stock Incentive Plan (the "Program") is
designed to focus executive efforts on the long-term goals of the Company and to
maximize total returns to stockholders. Stock options align the interest of
employees and stockholders by providing value to the executive through stock
price appreciation only. During 2000, the Company granted a total of 1,322,800
stock options to key employees under the Program. The stock options granted
during 2000 were granted at fair market value as of the date of grants, which
varied from $0.563 per share to $3.875 per share. The Compensation Committee
believed that with the five year employment agreements of certain members of the
top management of the Company expiring in 2000, and to retain recent additions
to senior management, significant stock option grants were required in 2000. Mr.
Van Ness was granted options for 25,000 shares in 2000, less than the other
named executives as he already had a significant equity and option stake in the
Company.
It is anticipated that future stock option awards will be made at the
discretion of the Plan Committee (with the advice of the Chief Executive
Officer).
All of the named officers have change in control provisions as part of
their employment agreements, which generally provide for two times base salary
plus the highest annual bonus as a payment on a change in control which contain
identical terms. The Compensation Committee thought it was important for the
Company to enter into these arrangements in order to provide security to these
officers in the event of a change in control (as defined), to promote their
continued affiliation with the Company and to protect both the Company and the
shareholders by assuring continuity during a transition period related to any
change in control.
2000 Chief Executive Officer Pay
On January 5, 2000 Mr. Van Ness entered into a three year employment
agreement. The terms of the employment agreement include an annual base salary
of $300,000 for the year 2000 with subsequent annual increases of $25,000,
participation in the Company's executive bonus program based on the achievement
of certain goals established by the Board of Directors and stock option grants
covering 25,000 shares of the Company's Common stock on each of January 2000,
January 2001 and January 2002. In January 2001, at the request of Mr. Van Ness,
Mr. Van Ness' employment agreement was amended to limit the term of his
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obligation to serve as the Company's Chief Executive Officer until June 30,
2001. Beginning July 1, 2001 until the expiration of his employment, Mr. Van
Ness will serve only as the Company's Chairman, and/or such other title/titles
as may be agreed upon between the Company and Mr. Van Ness, which position shall
not be the Chief Executive Officer. Mr. Van Ness' annual base salary was subject
to a 30% reduction from April 1, 2001 to June 30, 2001; a 40% reduction from
July 1, 2001 through September 30, 2001; and a 50% reduction from October 1,
2001 to the expiration of his employment agreement to reflect his reduced
responsibilities. In addition to his base salary, Mr. Van Ness may receive a
bonus up to 100% of his base salary for the applicable year, if the Company
attains certain performance goals. If the Company sells one or more divisions or
subsidiaries during the period from January 1, 2001 to the expiration of his
employment agreement, Mr. Van Ness is entitled to receive an amount equal to 1%
of the net proceeds from such sale. If Mr. Van Ness' employment is terminated
without cause, Mr. Van Ness will be paid and receive other employee benefits
through the remaining term of the agreement. If Mr. Van Ness' employment is
terminated due to a change in control of the Company, Mr. Van Ness would be paid
a lump sum amount equal to two times his base annual salary and his highest
bonus compensation earned by Mr. Van Ness during his employment with the
Company. All stock options granted to Mr. Van Ness as a part of his employment
agreements described above are exercisable for a period of ten years from the
date of grant and are not subject to forfeiture. The Compensation Committee
believed that Mr. Van Ness was entitled to a significant commitment from the
Company, both in the short term through additional salary and in the long term
through additional options and contract length because of his outstanding
leadership and significant contributions to the Company.
This report shall not be deemed incorporated by reference by any general
statement incorporating this Proxy Statement by reference to any filing under
the Securities Act of 1933, as amended, or under the Securities Exchange Act of
1934, as amended, and shall not be deemed filed under either of such acts except
to the extent that the Company specifically incorporates this information by
reference.
This report is furnished by the Compensation Committee of the Board of
Directors.
Marilu Marshall, Chair
Thomas E. Durkin III Matthew J. Morahan John S. Wehrle
Audit Committee Matters
Audit Committee Charter. The Board has adopted an Audit Committee
Charter which is attached to this Proxy Statement as Appendix A.
Independence of Audit Committee Members. The Common Stock is listed on
the American Stock Exchange and the Company is governed by the listing standards
applicable thereto. All members of the Audit Committee of the Board of Directors
have been determined to be "independent directors" pursuant to the definition
contained in of the American Stock Exchange listing standards ss.121(A).
Audit Committee Report. In connection with the preparation and filing of
the Company's Annual Report on Form 10-K for the year ended December 31, 2000:
(1) the Audit Committee reviewed and discussed the audited financial statements
with the Company's management;
(2) the Audit Committee discussed with the Company's independent auditors the
matters required to be discussed by SAS 61;
(3) the Audit Committee received and reviewed the written disclosures and the
letter from the Company's independent auditors required by the Independence
Standards Board Standard No. 1 (Independence Discussions with Audit Committees)
and discussed with the Company's independent auditors any relationships that may
impact their objectivity and independence and satisfied itself as to the
auditor's independence; and
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(4) based on the review and discussions referred to above, the Audit Committee
recommended to the Board that the audited financial statements be included in
the 2000 Annual Report on Form 10-K.
This report shall not be deemed incorporated by reference by any general
statement incorporating this Proxy Statement by reference to any filing under
the Securities Act of 1933, as amended, or under the Securities Exchange Act of
1934, as amended, and shall not be deemed filed under either of such acts except
to the extent that the Company specifically incorporates this information by
reference.
This report is furnished by the Audit Committee of the Board of
Directors.
John S. Wherle, Chairman
Jon F. Hanson John A. Simourian, Jr. Thomas E. Durkin, III
Accounting Fees and Other Accounting Matters
Audit Fees. The Company was billed $400,000 for the audit of the
Company's annual financial statements for the year ended December 31, 2000 and
for the review of the financial statements included in the Company's Quarterly
Reports on Form 10-Q filed during 2000.
Financial Information Systems Design Implementation Fees. The Company
was billed $0 for any professional services described in Paragraph (c) (4) (ii)
of Rule 2-01 of the SEC's Regulation S-X (in general, information technology
services) rendered by the Company's principal accountant during the year ended
December 31, 2000.
All Other Fees. The Company was billed $140,000 for non-audit services
(other than the non-audit services described above) rendered by the Company's
principal accountant during the year ended December 31, 2000.
Other Matters. The Audit Committee of the Board of Directors has
considered whether the provision of information technology services and other
non-audit services is compatible with maintaining the independence of the
Company's principal accountant.
Of the time expended by the Company's principal accountant to audit the
Company's financial statements for the year ended December 31, 2000, less than
50% of such time involved work performed by persons other than the principal
accountant's full-time, permanent employees.
PERFORMANCE GRAPH
The following chart compares the cumulative total shareholder return on
the Company's Common Stock to the cumulative total return of the Standard &
Poor's 500 Stock Index and the Dow Jones Transportation Index for the Year 1996,
1997, 1998, 1999 and 2000, assuming the investment of $100 on December 31, 1995
and the reinvestment of all dividends since that date to December 31, 2000.
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[LINE CHART]
S&P 500 Dow Jones
Date CD&L Index Transportation Index
-----------------------------------------------------------------
Dec-95 100.0 100.0 100.0
Mar-96 61.4 106.5 105.3
Jun-96 54.5 107.9 109.7
Sep-96 50.0 108.0 113.0
Dec-96 40.9 114.1 121.4
Mar-97 18.2 115.5 124.3
Jun-97 20.5 131.3 140.8
Sep-97 25.6 140.6 145.7
Dec-97 22.7 141.5 148.7
Mar-98 40.3 151.1 162.1
Jun-98 40.3 143.6 165.5
Sep-98 34.1 128.5 156.4
Dec-98 28.7 141.5 176.3
Mar-99 29.5 146.5 181.4
Jun-99 35.2 132.3 188.4
Sep-99 27.3 132.3 182.1
Dec-99 34.1 133.9 196.3
Mar-00 23.3 132.4 199.2
Jun-00 13.6 130.3 196.6
Sep-00 5.1 136.8 196.0
Dec-00 4.0 154.0 188.2
The performance of the Company's Common Stock reflected above is not
necessarily indicative of the future performance of the Common Stock. The total
return on investment (change in the year-end stock price plus reinvested
dividends) for the period shown for the Company, the S&P 500 Index and the Dow
Jones Transportation Index is based on the stock price or composite index at
December 31, 1996. In prior years, the Company used the S&P Transportation
Index. Such Index was not as readily available to the Company this year. The Dow
Jones Transportation Index was down 1% for the year; the S&P Transportation
Index was up 18.5% for the year.
The performance chart which appears above shall not be deemed to be
incorporated by reference by any general statement incorporating this Annual
Report by reference into any filing under the Securities Act of 1933, as
amended, or under the Exchange Act of 1934, as amended, and shall not be deemed
filed under either of such Acts except to the extent that the Company
specifically incorporates this information by reference.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Compensation Committee is comprised currently of Ms.
Marilu Marshall, Chair, Mr. Thomas E. Durkin III, Mr. Matthew J. Morahan, and
Mr. John S. Wehrle. None of the Committee's members have been an officer or
employee of the Company. At present, no executive officer of the Company and no
member of its Compensation Committee is a director or compensation committee
member of any other business entity which has an executive officer that sits on
the Company's Board of Directors or Compensation Committee.
CERTAIN TRANSACTIONS
Sale of Assets of the Company's Air Freight Division
William T. Beaury, an 8.7% shareholder of the Company's stock, is the
president and holds an ownership interest in the purchaser of the assets of the
Company's subsidiary, Sureway Air Traffic Corporation ("Sureway"). Pursuant to a
certain Asset Purchase Agreement dated as of March 7, 2001, by and between
Sureway and the purchaser ("Asset Purchase Agreement"), and upon consummating
the transactions contemplated in the Asset Purchase Agreement on March 30, 2001,
the Company received a total of $14,150,000 from the purchaser for the sale of
substantially all of the assets of Sureway. The total sale price is comprised of
$11,650,000 in cash, a promissory note for $2,500,000 and contingent cash
payments based upon the ultimate development of certain liabilities retained by
the Company. The terms of the Asset Purchase Agreement were negotiated at
arms-length and approved by the Company's Board of Directors. The Company
reduced the amount of its senior credit facility with the proceeds from the sale
of Sureway's assets.
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Real Estate Transactions
Mr. Brooks and members of his immediate family own various real estate
partnerships which lease properties to Silver Star, a subsidiary of the Company
for use as terminals in Miami, Florida, Atlanta and Valdosta, Georgia and
Dayton, Ohio. In 2000, Silver Star paid approximately $117,000 in rent for these
properties. As of January 1, 2001, the Company is obligated to pay rentals of
approximately $117,000 for these properties, which the Company believes to be
the fair market rental value of the properties.
Mr. Brana has an interest in Sparta Truck and Auto Leasing Corp.
("Sparta"). Sparta leases vehicles to Securities Courier Corporation, a
subsidiary of the Company. During 2000, Securities Courier Corporation paid
approximately $183,000 in lease payments to Sparta. As of January 1, 2001,
Securities Courier Corporation was obligated to make lease payments to Sparta in
approximately the same amount, which the Company believes to be fair market
value for such lease payments.
Company Policy
In the future, transactions with officers, directors and affiliates of
the Company are anticipated to be minimal and will be approved by a majority of
the Board of Directors, including a majority of the disinterested members of the
Board of Directors, and will be made on terms no less favorable to the Company
than could be obtained from unaffiliated third parties.
PROPOSAL THREE
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen LLP as the
Company's independent public accountants for the year ending December 31, 2001.
Arthur Andersen LLP has served as the Company's independent public accountants
since its formation in 1995. Although the appointment of independent public
accountants is not required to be approved by the stockholders, the Board of
Directors believes stockholders should participate in the selection of the
Company's independent public accountants. Accordingly, the stockholders will be
asked at the Meeting to ratify the Board's appointment of Arthur Andersen LLP as
the Company's independent public accountants for the year ending December 31,
2001.
Representatives of Arthur Andersen LLP will be present at the Meeting.
They will have an opportunity to make a statement if they so desire and will be
available to respond to appropriate questions of the stockholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ARTHUR ANDERSEN LLP AS
INDEPENDENT PUBLIC ACCOUNTANTS AS DESCRIBED ABOVE.
STOCKHOLDER PROPOSALS
Any proposal intended to be presented by a stockholder at the 2002
Annual Meeting of Stockholders must be received by the Company at the address
specified below no later than the close of business on December 31, 2001 to be
considered for inclusion in the Proxy Statement for the 2002 Annual Meeting and
by March 15, 2002 in order for the proposal to be considered timely for
consideration at next year's Annual Meeting (but not included in the Proxy
Statement for such meeting). Any proposal should be addressed to Mark Carlesimo,
Secretary, CD&L, Inc., 80 Wesley Street, South Hackensack, New Jersey 07606 and
should be sent by certified mail, return receipt requested.
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OTHER MATTERS
The Board of Directors does not know of any matters, other than those
referred to in the accompanying Notice for the Meeting, to be presented at the
Meeting for action by the stockholders. However, if any other matters are
properly brought before the Meeting or any adjournments thereof, it is intended
that votes will be cast with respect to such matters, pursuant to the proxies,
in accordance with the best judgment of the person acting under the proxies.
By Order of the Board of Directors
Mark Carlesimo
Secretary
May 16, 2001
A COPY OF THE COMPANY'S ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31,
2000 ACCOMPANIES THIS PROXY STATEMENT. THE ANNUAL REPORT IS NOT TO BE REGARDED
AS PROXY SOLICITING MATERIAL NOR AS A COMMUNICATION BY MEANS OF WHICH ANY
SOLICITATION IS TO BE MADE.
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APPENDIX A
AUDIT COMMITTEE CHARTER
The Audit Committee is appointed by the Board of Directors of CD&L, Inc.
("CDL") to assist the Board in monitoring (a) the integrity of the financial
statements of CDL and its subsidiaries (the "Company") and (b) the independence
of performance of the Company's external and, if applicable, internal auditors.
The members of the Audit Committee shall meet the independence and
experience requirements of the American Stock Exchange, subject to such
qualifications and exceptions as may be permitted by such requirements. The
members of the Audit Committee shall be appointed from time to time by the CDL
Board. The CDL Board reserves the right to amend, modify or replace this Charter
in its discretion at any time.
The Audit Committee shall have the authority to retain special legal,
accounting or other consultants to advise the Audit Committee. The Audit
Committee may request any officer or employee of the Company, the Company's
outside counsel or independent auditor to attend meetings of the Audit Committee
or to meet with any members of, or consultants to, the Audit Committee.
The primary goals of this Charter are to specify the following:
o the scope of the Audit Committee's responsibilities and the
approaches to be used in carrying out those responsibilities,
including structure, processes and membership requirements;
o the Audit Committee's responsibility for (a) insuring its receipt
from the Company's independent auditor of a formal written statement
delineating all relationships between such auditor and the Company,
consistent with Independence Standards Board Standard No. 1, (b)
actively engaging in a dialogue with such auditor with respect to
any disclosed relationships or services that may impact the
objectivity and the independence of the auditor and (c) taking, or
recommending that the CDL Board take, appropriate action to oversee
the independence of the independent auditor; and
o the independent auditor's ultimate accountability to the CDL Board
and the Audit Committee, as representatives of the shareholders of
CDL and the ultimate authority and responsibility of the CDL Board
and/or the Audit Committee to select, evaluate and, where
appropriate, replace the independent auditor (or, if applicable, to
nominate the independent auditor to be proposed for shareholder
approval in any proxy statement).
To the extent any statement set forth below is inconsistent with the three
principles set forth above, the three principles set forth above shall govern.
The Audit Committee shall make regular reports to the CDL Board, as
required by the Delaware General Corporation Law.
Pursuant to this Charter:
1. THE COMMITTEE
The Audit Committee will consist of at least three members of the CDL
Board including a Chairman designated by the CDL Board. Members of the
Audit Committee may not be employees of the Company. The Committee will
meet at least three times a year, with additional meetings if
circumstances require, for the purpose of satisfying its
responsibilities.
A-1
2. SCOPE
The Audit Committee serves at the pleasure of and is subject to the
control and direction of the CDL Board.
2. RESPONSIBILITIES OF THE COMMITTEE
- To assist the CDL Board in fulfilling its fiduciary responsibilities
to the shareholders with respect to matters relating to the
Company's business, accounting, reporting, audit and internal
controls practices.
- To maintain a direct line of communications between the CDL Board
and the Company's independent auditors and internal auditors to
provide for an exchange of views and information.
4. FUNCTIONS OF THE COMMITTEE
The Audit Committee will satisfy its responsibilities by completing the
following functions:
- Discuss the results of the annual internal and independent audits
with management and the internal and independent auditors.
- Consider the comments from the independent auditors and internal
auditors with respect to internal accounting and management controls
and the consideration given or action taken by management.
- Recommend, for appointment by the CDL Board, the selection of
independent auditors for the coming year.
- Appraise the effectiveness of the independent audit effort through
discussions with the independent auditors regarding their planned
arrangements and scope of the annual audit, including fees.
- Review the scope of planned activities and budget along with a
review of the effectiveness of the Company's internal auditors, if
any.
- Review the anticipated scope and related fees of any non-audit
services to be provided by the independent auditors to ensure that
these services do not detract from the independence of the auditors
in their audit function.
- Consider the comments from the independent auditors with respect to
internal accounting and management controls and the consideration
given or action taken by management.
- Review the Committee's responsibilities and functions, evaluate its
performance, and institute appropriate modifications to reflect
changes in the business environment.
- Monitor the procedures or systems used in preparing the financial
statements of the Company.
- Obtain the assessment of management and the independent auditors as
to the adequacy of:
- the Company's internal accounting procedures and controls.
- the Company's procedures for complying with SEC Regulations and
The Foreign Corrupt Practices Act.
A-2
- Receive and review the assessment of management as to the quality
and depth of staffing in the accounting and financial departments
worldwide.
- Receive from the Company's independent auditor a formal written
statement delineating all relationships between such auditor and the
Company, consistent with Independence Standards Board Standard No.
1.
- Engage in dialogue with the Company's independent auditor with
respect to any disclosed relationships or services that may impact
the objectivity and independence of such firm.
- Recommend to the CDL Board appropriate actions to ensure the
independence of the Company's independent auditor.
- Review and reassess the adequacy of this Charter annually and
recommend any proposed changes to the CDL Board for approval.
- Meet with independent auditor without management present.
- Review the interim financial statements and financial results with
independent auditor prior to filing Form 10-Qs.
- Review Year-End financial statements and financial results prior to
filing Form 10-K.
- Discuss required communication with independent auditor as required
by SAS 61 of GAAS.
- Review any information submitted to the Audit Committee pursuant
to Section 10A of the Private Securities Litigation Reform Act
of 1995.
- Prepare the report to the CDL Board for inclusion in the
Company's annual proxy statement.
- Review with the independent auditor any material problems or
difficulties the auditor may have encountered during an audit
including any restrictions on the scope of activities or access
to required information; review any management letter provided
by the auditor and the Company's response to that letter.
While the Audit Committee has the responsibilities and powers set forth
in this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate or are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditor. Nor is it
the duty of the Audit Committee to conduct investigations, to resolve
disagreements, if any, between management and the independent auditor or to
assure compliance with laws and regulations.
A-3
CD&L, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS,
JUNE 6, 2001
The undersigned hereby appoints Albert W. Van Ness, Jr. and Mark
Carlesimo, and each of them, attorneys and proxies with power of substitution,
to vote for and on behalf of the undersigned at the CD&L, Inc. Annual Meeting of
Stockholders to be held on June 6, 2001 and at any adjournments or postponements
thereof (the "Meeting"), upon the following matters and upon any other business
that may properly come before the Meeting, as set forth in the related Notice of
Meeting and Proxy Statement, both of which have been received by the
undersigned.
This proxy, when properly executed, will be voted in the manner directed
by the undersigned stockholder. If this proxy is executed but no direction is
made, this proxy will be voted FOR the board's nominees for director, FOR the
approval of the amendment to the CD&L, Inc. Year 2000 Stock Incentive Plan, and
FOR the ratification of the Company's independent accountants.
PLEASE INDICATE YOUR VOTE ON THE OTHER SIDE.
(CONTINUED, AND TO BE DATED AND SIGNED, ON THE OTHER SIDE)
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
"FOR" PROPOSALS 1, 2 and 3
Against all
nominees
For all *(except as marked to
nominees the contrary below) Nominees:
--------
1. Election of 3 ------------- -------------------- Class III
Directors. ------------- -------------------- William T. Brannan
Marilu Marshall
John Wehrle
* To withhold authority for any individual nominees, print nominee's name on the
line below.
-------------------------------------------
-------------------------------------------
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FOR AGAINST ABSTAIN
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2. Amendment to the CD&L, Inc. Year 2000 Stock
Incentive Plan.
---------------------------------------------------------------------------------------------
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3. Ratification of Arthur Andersen LLP as
Independent Public Accountants for 2001.
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UNLESS OTHERWISE SPECIFIED IN THE SQUARES OR SPACE PROVIDED IN THIS PROXY, THIS
PROXY WILL BE VOTED FOR EACH OF THE BOARD'S NOMINEES, FOR THE AMENDMENT TO THE
2000 STOCK INCENTIVE PLAN AND FOR ARTHUR ANDERSEN LLP.
Please sign this proxy and return it promptly whether or not you expect to
attend the meeting. You may nevertheless vote in person if you attend.
Signed:
-----------------------------
Signed: Dated: , 2001.
----------------------------- -----------------------
NOTE: Please sign exactly as your name appears hereon. Give full title if an
Attorney, Executor, Administrator, Trustee, Guardian, etc. For an account in the
name of two or more persons, each should sign, or if one signs, he should attach
evidence of his authority.