SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
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Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
Celadon Group, Inc.
(Name of Registrant as Specified in Its Charter)
(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 14a6(i)(1) and 0-11.
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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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[ ] Fee paid previously with preliminary materials.
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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.
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CELADON GROUP, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of
CELADON GROUP, INC.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Celadon
Group, Inc. (the "Company") will be held at the Company's corporate headquarters
located at One Celadon Drive, Indianapolis, Indiana 46235-4207 on Friday,
November 21, 2003 at 10:00 a.m. (local time) for the following purposes:
1. Election of directors for the ensuing year;
2. To transact such other business as may properly be brought before
the meeting.
The Board of Directors has fixed the close of business on October 10, 2003
as the record date for the determination of stockholders entitled to notice of,
and to vote at, the meeting. Any action may be taken on the foregoing matters at
the meeting on the date specified above, or on any date or dates to which the
meeting may be adjourned or postponed. A list of stockholders entitled to vote
at the meeting will be available for examination by any stockholder for any
purpose germane to the meeting at our main office during the ten days prior to
the meeting, as well as at the meeting.
By order of the Board of Directors
Paul A. Will
Secretary
October 10, 2003
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER
TO ENSURE THAT YOUR SHARES ARE VOTED.
CELADON GROUP, INC.
One Celadon Drive
Indianapolis, Indiana 46235
PROXY STATEMENT
This statement is furnished in connection with the solicitation of proxies
on behalf of the Board of Directors of Celadon Group, Inc. (the "Company") to be
voted at the Annual Meeting of Stockholders of the Company (the "Meeting") to be
held on Friday, November 21, 2003, beginning at 10:00 a.m., local time, at the
Company's corporate headquarters and principal executive offices located at One
Celadon Drive, Indianapolis, Indiana 46235-4207. If not otherwise specified, all
properly executed proxies received pursuant to this solicitation, and not
revoked, will be voted in the election of directors FOR the persons named below.
Stockholders who execute proxies may revoke them at any time before they
are exercised by giving written notice of revocation to the Secretary of the
Company at the address of the Company, by executing a subsequent proxy relating
to the same shares and presenting it to the Secretary of the Company, or by
attending the meeting and voting in person (attendance at the meeting, will not,
in and of itself, constitute revocation of a proxy).
Directors will be elected by a plurality of the votes present in person or
represented by proxy at the Meeting and entitled to vote on election of
directors. Approval of any other matters that come before the Meeting for action
will require the affirmative vote of the holders of a majority of the stock duly
voted on the matter. Each share is entitled to one vote on each matter that
comes before the Meeting. In the election of directors, stockholders may either
vote "FOR" all nominees for election or withhold their votes from one or more
nominees for election. Votes that are withheld and shares held by a broker, as
nominee, that are not voted (so-called "broker non-voters") in the election of
directors will not be included in determining the number of votes cast. With
respect to a vote for any other matter that comes before the Meeting for action,
stockholders may vote "FOR," "AGAINST" or "ABSTAIN" with respect to such
matters. Proxies marked to abstain will have the same effect as votes against
such matters, and broker non-votes will have no effect on such matters. Unless a
proxy is properly revoked pursuant to the procedures described above, the Board
of Directors, as proxy for the stockholder, will have the discretion to vote on
any other matters that properly come before the Meeting on behalf of the
stockholder as directed by a majority of the Board of Directors in their best
judgment.
A majority of the shares of the Company's common stock, present in person
or represented by proxy, shall constitute a quorum for purposes of the Meeting.
Proxies marked to abstain are counted for purposes of determining a quorum.
Dissenters' rights of appraisal will not be available with respect to the
matters to be acted on at the Meeting.
This proxy statement and the accompanying form of proxy are first being
mailed to stockholders on or about October 17, 2003.
Proxies are being solicited hereunder by the Company. The entire cost of
soliciting proxies hereunder will be borne by the Company. Proxies will be
solicited by mail, and may be solicited personally by directors, officers or
regular employees of the Company who will not be compensated for their services.
The Company will reimburse brokers and banks for their reasonable expenses for
forwarding material to beneficial owners for whom they hold stock.
As of October 1, 2003, the Company had outstanding 7,709,394 shares of
common stock, par value $.033 per share (the "Common Stock"), entitled to vote
at the meeting, each share being entitled to one vote. Only stockholders of
record at the close of business on October 10, 2003, will be entitled to vote at
the Meeting.
MATTERS TO COME BEFORE THE ANNUAL MEETING
PROPOSAL 1: ELECTION OF DIRECTORS
At the Meeting, five directors are to be elected to hold office until the
Annual Meeting of Stockholders in 2004 and until their respective successors
have been elected and qualified. It is the intention of the persons named in the
enclosed form of proxy to vote for the election as directors of the Company of
Stephen Russell, Paul A. Biddelman, Anthony Heyworth, Michael Miller and John
Kines. All of the individuals are currently directors of the Company, and all of
the named individuals are nominees of the Board of Directors. All directors of
the Company hold office until the next annual meeting of stockholders of the
Company or until their successors are elected and qualified or they resign.
The table in the section below entitled "Directors and Executive Officers"
sets forth certain information about each nominee for election to the Board of
Directors, as well as each of the Company's executive officers.
It is intended that the proxies solicited on behalf of the Board of
Directors (other than proxies in which the vote is withheld as to one or more
nominees) will be voted at the Meeting for the election of the nominees
identified below. If any nominee is unable to serve, the shares represented by
all such proxies will be voted for the election of such substitute as the Board
of Directors may recommend. At this time, the Board of Directors knows of no
reason why any of the nominees might be unable to serve, if elected.
Executive officers hold office until their successors are chosen and
qualified, subject to their removal by the Board of Directors, the terms of any
applicable employment-related agreements or their resignation. See "Compensation
Committee Report on Executive Compensation--Chief Executive Officer's
Compensation."
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE ELECTION OF
ALL FIVE NOMINEES.
2
DIRECTORS AND EXECUTIVE OFFICERS
The directors and executive officers of the Company as of October 1, 2003 are as
follows:
Name Age Position
---- --- --------
Stephen Russell 63 Chief Executive Officer and Chairman
Thomas Glaser 53 Executive Vice President - Truck Operations/Sales
Jerry Closser(3) 46 Executive Vice President - Fleet Services
David Shatto 45 Executive Vice President - Dedicated Operations and Acquisitions
Paul A. Will 37 Chief Financial Officer, Secretary and Assistant Treasurer
Michael Dunlap 41 Vice President - Finance, Treasurer and Assistant Secretary
Sergio Hernandez 45 Vice President - Mexico
Paul A. Biddelman(2) 57 Director of the Company
Michael Miller(1) 58 Director of the Company
Anthony Heyworth(1) 59 Director of the Company
John Kines(1)(2) 61 Director of the Company
(1) Members of the Audit Committee
(2) Members of the Compensation Committee
(3) Mr. Closser is no longer an officer or employee of the Company as of
October 2, 2003.
Mr. Russell has been Chairman of the Board and Chief Executive Officer of
the Company since its inception in July 1986. He is also a director of the
Truckload Carriers Association ("TCA") and the Executive Committee of the
American Trucking Association. Mr. Russell is a director of Star Gas Corporation
(the General Partner of Star Gas L.P.), a home heating and LPG company. Mr.
Russell has been a member of the Board of Advisors of the Cornell University
Johnson Graduate School of Management since 1983 and is on the Board of the
Indiana Heart Association and the Eiteljorg Museum.
Mr. Glaser has been Executive Vice President - Truckload Operations/Sales
since April 2003. He was Executive Vice President - Operations from September
2001 to April 2003. He was Vice President - Transportation Services from May
2001 to September 2001. He served in various management capacities at Contract
Freighters, Inc. for over thirteen years, most recently as Vice President -
Operations prior to joining the Company.
Mr. Closser was Executive Vice President - Fleet Services since December
2000. Mr. Closser joined the Company in July 1999 when the Company purchased
Zipp Express, Inc. He was President of Zipp Express, Inc. since its inception in
1977.
Mr. Shatto has been Executive Vice President - Dedicated Operations and
Acquisitions since April 2003. He was Executive Vice President - Sales and
Marketing of the Company from September 2001 to April 2003. He was Executive
Vice President - Operations from December 2000 to September 2001. He was
Executive Vice President - Operations of Celadon Trucking Services, Inc. from
February 1999 to December 2000. He served in various management capacities in
the truckload market segment for over nineteen years, most recently as Vice
President and General Manager of Shaffer Trucking, Inc. before joining the
Company.
3
Mr. Will has been Chief Financial Officer, Secretary and Assistant
Treasurer of the Company since April 2000. He was Vice President - Chief
Financial Officer and Secretary of the Company from December 1998 to March 2000.
He was Vice President-Secretary and Controller of the Company from September
1996 to December 1998. He was Vice President-Controller for Celadon Trucking
Services, Inc. from January 1996 to September 1996 and Controller from September
1993 to January 1996. Mr. Will is a certified public accountant.
Mr. Dunlap has been Vice President Finance, Treasurer and Assistant
Secretary of the Company since May 2002. He was the Chief Operating Officer of
TruckersB2B, Inc., a subsidiary of the Company, from April 2001 to May 2002. He
was Vice President of Strategic Development of TruckersB2B from April 2000 to
April 2001. He was the Vice President Treasurer of the Company from July 1996 to
April 2001. He served as Vice President of Finance for National Freight, Inc., a
regional truckload transportation company from October 1993 to July 1996.
Mr. Hernandez has been Vice President - Mexico since December 2001. He was
Director of Mexico Sales from October 1996 to December 2001. He has over 20
years of responsibilities in marketing and transportation throughout Mexico.
Mr. Biddelman has been a director of the Company since October 1992. Mr.
Biddelman has been President of Hanseatic Corporation, a private investment
company, since 1997. He is also a director of Insituform Technologies, Inc., Six
Flags, Inc., SystemOne Technologies, Inc., and Star Gas Corporation (the General
Partner of Star Gas Partners L.P.).
Mr. Miller has been a director of the Company since February 1992. Mr.
Miller has been Chairman of the Board and Chief Executive Officer of Aarnel
Funding Corporation, a venture capital/real estate company since 1974, a partner
of Independence Realty, an owner and manager of real estate properties, since
1989, and President and Chief Executive Officer of Miller Investment Company,
Inc., a private investment company, since 1990.
Mr. Heyworth has been a director of the Company since 1999. He retired
from KeyCorp in February 2001 as Vice Chairman, commercial banking, KeyBank N.A.
after a 35-year career with this $85 billion financial services company. He
continues as Chairman of KeyBank Central Indiana, having served as President and
Chief Executive since 1991. He joined the former Central National Bank in 1965
and was Executive Vice President when the bank merged with Society National Bank
of Cleveland in 1986 and Key Bank in 1994.
Mr. Kines was appointed as a director of the Company on June 9, 2000. He
retired from Associates First Capital Corp. ("Associates") in May 2000 as
President of the Diversified Service Group after a 22-year career with
Associates.
Pursuant to Section 145 of the Delaware General Corporation Law, the
Company's Certificate of Incorporation provides that the Company shall, to the
full extent permitted by law, indemnify all directors, officers, incorporators,
employees, or agents of the Company against liability for certain of their acts.
The Company's Certificate of Incorporation provides that, with a number of
exceptions, no director of the Company shall be liable to the Company for
damages for breach of fiduciary duty as a director.
4
COMMITTEES OF THE BOARD
The Audit Committee consisted of Paul A. Biddelman, Anthony Heyworth and
John Kines through April 30, 2003. Effective May 1, 2003, the Audit Committee
consists of Anthony Heyworth, Michael Miller and John Kines. The Audit Committee
meets with management and the Company's independent auditors to determine the
adequacy of internal controls and other financial reporting matters. The Board
of Directors has determined that all members of the Audit Committee are
"independent" as defined in the applicable listing standards of the NASDAQ
National Market System. The Board of Directors adopted a newly written charter
for the Audit Committee in 2003 (see "Appendix A").
The Compensation Committee previously consisted of Michael Miller and John
Kines. Effective May 1, 2003, the Compensation Committee consists of Paul
Biddelman and John Kines. The Compensation Committee reviews general policy
matters relating to compensation and benefits of employees and officers of the
Company, and administers the Company's Stock Option Plan.
The Company does not have a nominating committee. The functions normally
performed by a nominating committee are performed by the Company's Board of
Directors as a whole. The Board of Directors will consider nominees recommended
by security holders. In order to submit such a nomination, a stockholder must
submit a statement stating the following information: the nominee's name;
contact information; age; any positions and offices with the Company or any of
its subsidiaries held at any time; a description of any arrangement or
understanding between the nominee and any other person (naming such person(s))
pursuant to which the nominee is or was to be nominated; a description of the
nominee's business experience during the past five years, including principal
occupation and employment, name and principal business of any organization in
which such occupation or employment were carried on and whether such
organization is an affiliate of the Company.
MEETINGS OF THE BOARD
The Board of Directors of the Company met four times during the fiscal
year ended June 30, 2003. No current director, while he was an elected director,
failed to attend at least 75% of those meetings plus any committee meetings of
the board of which he was a member. The Company's Audit Committee met nine times
during the year ended June 30, 2003. The Compensation Committee met two times
during the year ended June 30, 2003.
REPORT OF THE AUDIT COMMITTEE
The following report does not constitute solicitation material and is not
considered filed or incorporated by reference into any other Company filing
under the Securities Act of 1933 or the Securities Exchange Act of 1934, unless
otherwise stated.
The Audit Committee reviews the Company's financial reporting process on
behalf of the Board of Directors. Management is responsible for the financial
controls. The independent auditors are responsible for expressing an opinion on
the conformity of the audited financial statements with accounting principles
generally accepted in the United States.
5
In fulfilling its responsibilities:
- The Audit Committee reviewed and discussed the audited financial
statements contained in the 2003 Annual Report on Form 10-K with the
Company's management and the independent auditors.
- The Audit Committee discussed with the independent auditors the
matters required to be discussed by Statement on Auditing Standards
No. 61 (Codification of Statements on Auditing Standards,
AUSection 380).
- The Audit Committee received from the independent auditors written
disclosures and the letter regarding the auditors' independence, as
required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees), and discussed with
the auditors their independence from the Company and its management.
In reliance on the reviews and discussions noted above, the Audit
Committee recommended to the Board of Directors (and the Board approved) that
the audited financial statements be included in the Company's Annual Report on
Form 10-K for the year ended June 30, 2003, for filing with the Securities and
Exchange Commission.
Respectfully submitted by the members of the Audit Committee of the Board
of Directors:
Anthony Heyworth (Chairman)
Michael Miller
John Kines
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In fiscal 2000, Truckers B2B sold 107,500 shares of its Class A common
stock for $1.00 per share to Michael Miller, a member of the Company's Board of
Directors, and 350,000 shares of its Class A common stock for $1.00 per share to
Hanseatic Corporation, which company was then a stockholder of the Company. Paul
Biddelman, a member of the Company's Board of Directors, is an officer of
Hanseatic Corporation which is no longer a stockholder of the Company.
On May 4, 2002, the Company loaned $150,000 for a term of four years to
Sergio Hernandez before Mr. Hernandez became an officer of the Company. As of
October 1, 2003, the outstanding amount of the loan was approximately $90,000
and the interest rate was 6.5%. On October 1, 2001, the Company also sold 6,000
shares of its Common Stock to Mr. Hernandez at a price of $4.00 per share. The
Company will not in the future make or extend any loans or extensions of credit
to any executive officer or director.
6
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS
The Compensation committee previously consisted of Michael Miller and John
Kines. Effective May 1, 2003, the Compensation Committee consists of Paul
Biddelman and John Kines. There are no interlocking compensation committee
relationships between the Company and any other entity, and no insiders
participate in compensation decisions.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, the Company's directors,
executive officers, and any persons owning more than 10 percent of the Common
Stock are required to report their ownership of Common Stock and any changes in
that ownership, on a timely basis, to the Securities and Exchange Commission
(the "SEC"). To the Company's knowledge, based solely on a review of materials
provided to the Company, all such required reports were filed on a timely basis
in fiscal 2003.
7
EXECUTIVE COMPENSATION
The following table sets forth the aggregate compensation paid or
accrued by the Company for services rendered during fiscal 2003, 2002 and 2001
to the Chief Executive Officer of the Company, and each of the five next most
highly compensated executive officers of the Company (collectively, the "Named
Executive Officers") during fiscal 2003.
SUMMARY COMPENSATION TABLE
LONG TERM
COMPENSATION
AWARD
NAME AND PRINCIPAL SHARES
POSITION YEAR SALARY BONUS OPTIONS ALL OTHER COMPENSATION
-------- ---- ------ ----- ------- ----------------------
Stephen Russell 2003 $556,172 $ 75,000 -- $106,748 (1)(2)(3)(4)(5)
Chairman & Chief 2002 544,781 -- 70,000 96,413 (1)(2)(3)(4)(5)
Executive Officer 2001 509,813 -- 75,000 103,772 (1)(2)(4)(5)
Jerry Closser 2003 $225,000 $ 50,000 -- $ 19,000 (2)(3)(4)(5)(7)
Executive Vice President 2002 233,654 -- 42,500 8,032 (2)(3)(5)
Fleet Services 2001 233,654 -- 20,000 8,601 (2)(5)
David Shatto 2003 $185,000 $ 50,000 -- $ 25,032 (2)(3)(4)(5)
Executive Vice President 2002 187,829 -- 32,500 16,464 (2)(3)(4)(5)
Sales 2001 163,923 10,000 30,000 14,930 (2)(4)(5)
Paul Will 2003 $176,923 $ 50,000 -- $ 24,787 (2)(3)(4)(5)
Chief Financial Officer, 2002 173,364 -- 31,250 13,284 (2)(3)(4)(5)
Secretary and 2001 148,077 25,000 50,000 10,675 (2)(4)(5)
Assistant Treasurer
Thomas Glaser 2003 $175,844 $ 50,000 -- $ 20,991 (2)(3)(4)(5)
Executive Vice President 2002 160,307 -- 47,200 48,363 (2)(3)(5)(6)
Operations 2001 21,538 -- 10,000 -- --
Michael Dunlap 2003 $141,238 $ 22,498 -- $ 9,786 (2)(3)(4)(5)
Treasurer and 2002 142,903 51,499 -- 12,004 (2)
Assistant Secretary 2001 120,577 14,160 15,000 8,891 (2)(4)(5)
(1) Includes the premiums paid by the Company for term insurance and
split-dollar insurance for which the Company has an assignment against the
cash value for premiums paid, as follows: $89,145 in fiscal 2003, $89,145
in fiscal 2002, and $81,081 in fiscal 2001.
(2) Includes the Company's contribution under the Company's 401(k) Profit
Sharing Plan, as follows: Stephen Russell - $1,109 in fiscal 2003, $1,117
in fiscal 2002, and $4,971 in fiscal 2001; Jerry Closser - $730 in fiscal
2003, $627 in fiscal 2002, and $2,080 in fiscal 2001; David Shatto -
$1,033 in fiscal 2003, $564 in fiscal 2002, and $2,602 in fiscal 2001;
Paul Will - $1,069 in fiscal 2003, $487 in fiscal 2002, and $1,933 in
fiscal 2001; Thomas Glaser - $1,097 in fiscal 2003 and $401 in fiscal
2002; and Michael Dunlap - $778 in fiscal 2003, $484 in fiscal 2002, and
$1,334 in fiscal 2001.
8
(3) Includes the Company's contribution under the Company's Excess Benefit
Plan as follows: Stephen Russell - $1,500 in fiscal 2003 and $773 in
fiscal 2002; Jerry Closser - $1,520 in fiscal 2003 and $1,168 in fiscal
2002; David Shatto - $1,460 in fiscal 2003 and $1,092 in fiscal 2002; Paul
Will - $1,595 in fiscal 2003 and $2,163 in fiscal 2002; Thomas Glaser -
$1,587 in fiscal 2003 and $602 in fiscal 2002; and Michael Dunlap - $1,084
in fiscal 2003 and $2,398 in fiscal 2002.
(4) Includes premiums and reimbursement under an executive health and
disability benefit program including split dollar life insurance premiums,
as follows: Stephen Russell - $1,870 in fiscal 2003, $250 in fiscal 2002,
and $4,705 in fiscal 2001; Jerry Closser - $2,124 in fiscal 2003; David
Shatto - $8,665 in fiscal 2003, $6,602 in fiscal 2002, and $7,770 in
fiscal 2001; Paul Will - $6,748 in fiscal 2003, $2,083 in fiscal 2002, and
$3,342 in fiscal 2001; Thomas Glaser - $1,432 in fiscal 2003 and Michael
Dunlap - $3,046 in fiscal 2003, $4,137 in 2002, and $2,157 in fiscal 2001.
(5) Includes the Company's car allowance as follows: Stephen Russell - $13,125
in fiscal 2003, $5,128 in fiscal 2002, and $13,015 in fiscal 2001; Jerry
Closser - $14,625 in fiscal 2003, $6,237 in fiscal 2002, and $6,521 in
fiscal 2001; David Shatto - $13,875 in fiscal 2003, $8,204 in fiscal 2002,
and $4,558 in fiscal 2001; Paul Will - $15,375 in fiscal 2003, $8,551 in
fiscal 2002, and $5,400 in fiscal 2001; Thomas Glaser - $16,875 in fiscal
2003, and $6,949 in fiscal 2002; and Michael Dunlap - $4,878 in fiscal
2003, $4,985 in fiscal 2002, and $5,400 in fiscal 2001.
(6) Thomas Glaser received reimbursement for relocation of $40,411 in fiscal
2002.
(7) Mr. Closser is no longer an officer or employee of the Company as of
October 2, 2003.
STOCK OPTIONS
There were no stock options granted to the Named Executive Officers in
fiscal 2003. No stock appreciation rights were granted in fiscal 2003.
REPORT ON OPTION EXERCISES AND HOLDINGS
The following table sets forth information concerning the exercise of
options during the last fiscal year and unexercised options held at June 30,
2003 with respect to the Named Executive Officers. There were no options
exercised during fiscal 2003.
OPTION VALUES AT JUNE 30, 2003
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Options at June 30, 2003 at June 30, 2003 (1)
------------------------------- -------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
Steve Russell 188,334 46,666 $1,706,309 $ 422,791
Jerry Closser 36,668 30,832 332,209 279,341
David Shatto 55,001 27,499 498,309 249,141
Paul Will 97,500 28,750 883,350 260,475
Thomas Glaser 28,134 29,066 254,888 263,344
Michael Dunlap 32,500 --- 294,450 ---
-------------
(1) Fair market value of underlying securities was $9.06 per share based on
the closing price of the Company's Common Stock on June 30, 2003.
9
DIRECTORS' COMPENSATION
Non-employee directors of the Company receive an annual fee of $15,000,
payable quarterly, for serving as a director of the Company. Such directors
receive $1,250 per quarter for serving on committees. Paul Biddelman receives
$1,250 per quarter for serving as the lead director. The responsibility of lead
director includes coordinating and organizing all pertinent business discussions
with outside directors. Board members are reimbursed for their reasonable,
documented expenses for each meeting attended.
The Director Option Plan provides for the granting to non-employee
directors of non-qualified stock options to purchase an aggregate of not more
than 160,000 shares of Common Stock (subject to adjustment in certain
circumstances). Once each calendar year, the compensation committee may
authorize the grant of non-employee director stock options for members of the
Board of Directors.
Stock options granted to non-employee directors vest on the six-month
anniversary of the date of grant, assuming that the non-employee director is a
director on that date. All stock options granted to non-employee directors and
not previously exercisable become vested and fully exercisable immediately upon
the occurrence of a change in control of the Company.
All stock options granted pursuant to the Director Option Plan will expire
on the tenth anniversary of the date of grant. Stock options that are
exercisable upon a non-employee director's termination of directorship for any
reason other than death, disability or cause, prior to the complete exercise of
the stock option (or deemed exercise thereof), will remain exercisable following
such termination until the earlier of (i) the expiration of the 90 day period
following the non-employee director's termination of directorship or (ii) the
remaining term of the stock option. Stock options that are exercisable upon a
non-employee director's termination of directorship for disability or death will
remain exercisable by the non-employee director or, in the event of his or her
death, by the non-employee director's estate or by the person given authority to
exercise such stock options by his or her will or by operation of law, until the
earlier of (i) the first anniversary of the non-employee director's termination
of directorship or (ii) the remaining term of the stock option. Upon a
non-employee director's removal from the Board of Directors for cause, all
outstanding stock options of such director will immediately terminate and will
be null and void.
On April 30, 2003, Paul Biddelman, Michael Miller, Anthony Heyworth and
John Kines were each granted options to purchase 4,000 shares. All of the
options have an exercise price of $8.00 per share.
10
EQUITY COMPENSATION PLAN INFORMATION
The following table summarizes options outstanding under the Company's
equity compensation plans:
PLAN CATEGORY NUMBER OF SECURITIES WEIGHTED AVERAGE NUMBER OF SECURITIES
TO BE ISSUED EXERCISE PRICE OF REMAINING AVAILABLE FOR
UPON EXERCISE OF OUTSTANDING OUTSTANDING OPTIONS, FUTURE ISSUANCE UNDER
OPTIONS, WARRANTS AND RIGHTS WARRANTS AND RIGHTS EQUITY COMPENSATION PLANS
(EXCLUDING SECURITIES
REFLECTED IN COLUMN (A))
(A) (B) (C)
EQUITY COMPENSATION PLANS APPROVED 985,458 $6.70 163,713
BY SECURITY HOLDERS
EQUITY COMPENSATION PLANS NOT Not applicable Not applicable Not applicable
APPROVED BY SECURITY HOLDERS
TOTAL 985,458 $6.70 163,713
NEW PLAN BENEFITS
CELADON GROUP, INC.
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
NAME AND POSITION DOLLAR VALUE ($) NUMBER OF UNITS
Non-Executive Director Group $128,000 16,000
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
ROLE OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Company's Board of Directors (the
"Compensation Committee") was formed in September 1993 and is currently
comprised of two non-employee directors of the Company. The Compensation
Committee is responsible for determining the Company's compensation program for
its executive officers, including the Named Executive Officers. The Compensation
Committee administers the Stock Option Plan and, subject to the provisions of
such plan, determines grants under the plans for all employees, including the
Named Executive Officers. The Compensation Committee establishes and administers
the Company's bonus program, which is re-evaluated each fiscal year, pursuant to
which certain employees and executive officers of the Company may be eligible to
receive bonuses.
The Compensation Committee has furnished this report on the Company's
executive compensation policies. This report describes the Compensation
Committee's compensation policies applicable to the Company's executive officers
and provides specific information regarding the compensation of the Company's
Chief Executive Officer
11
PRINCIPLES OF EXECUTIVE COMPENSATION AND PROGRAM COMPONENTS
The Company's executive compensation philosophy is designed to attract and
retain outstanding executives and to foster employee commitment and align
employee and stockholder interests. To this end, the Company has sought to
provide competitive levels of compensation that integrate pay with the Company's
annual and long-term performance goals and reward above-average corporate
performance.
STOCK OPTION PLANS
The Stock Option Plan and the Director Option Plan are intended to enhance
the profitability and value of the Company for the benefit of its stockholders
by enabling the Company (i) to offer stock-based incentives to employees,
thereby creating a means to raise the level of stock ownership by such
individuals in order to attract, retain and reward such individuals and
strengthen the mutuality of interests between such individuals and stockholders,
and (ii) to grant non-discretionary, nonqualified stock options to non-employee
directors, thereby creating a means to attract, retain and reward such
non-employee directors and strengthen the mutuality of interests between
non-employee directors and stockholders. The Stock Option Plan and the Director
Option Plan permit the grant of incentive stock options (in the case of
employees) and nonqualified stock options on a discretionary, case-by-case
basis, after consideration of an individual's position, contribution to the
Company, length of service with the Company, number of options held, if any, and
other compensation.
CHIEF EXECUTIVE OFFICER'S COMPENSATION
Mr. Russell is employed pursuant to an employment agreement dated January
21, 1994, as amended thereafter, providing for his continued employment until
January 21, 2006. The employment period is automatically renewed for successive
two-year terms unless the Company or Mr. Russell gives written notice to the
other at least 90 days prior to the expiration of the then current employment
period of their intention to terminate Mr. Russell's employment. The employment
agreement provides Mr. Russell with a base salary equal to $521,000 (as adjusted
annually for increases in the Consumer Price Index). In addition, Mr. Russell is
eligible to participate in an incentive bonus program designed for all members
of the Company's senior management pursuant to which he may receive a bonus in
an amount equal to between 0% and 105% of his base salary in the discretion of
the Compensation Committee. The employment agreement also provides that Mr.
Russell is entitled to participate in all employee benefit plans of the Company
and all other fringe benefit plans generally available to employees of the
Company.
The agreement provides that in the event of termination: (i) by the
Company without cause (including the non-renewal of the employment period by the
Company) or by Mr. Russell for cause, Mr. Russell will be entitled to receive
his salary for the remainder of the then current employment period or one year,
whichever is greater; (ii) by reason of his disability, Mr. Russell will be
entitled to receive 50% of his salary during the two-year period commencing on
the date of his termination; and (iii) by reason of his death, Mr. Russell's
estate will be entitled to receive a pro-rata portion of the bonus for the
fiscal year in which his death occurs and to receive 50% of his salary until the
earlier of the end of the then current employment period or one year after the
date of death. The employment agreement includes a two-year non-compete covenant
commencing on termination of employment.
12
Upon the occurrence of a change in control (as defined in the employment
agreement), the amended agreement provides that if (i) at any time within two
years of a change in control or within 180 days prior to a change in control,
Mr. Russell's employment is terminated by the Company without cause or by Mr.
Russell for cause or (ii) at any time during the 90-day period immediately
following the date which is six months after the change in control Mr. Russell
terminates his employment for any reason, Mr. Russell shall be entitled to
receive (1) a lump sum payment in an amount equal to three times his base salary
and three times the highest annual bonus paid to him within three years prior to
the change in control; (2) any accrued benefits; (3) a pro-rata portion of the
bonus for the fiscal year in which the change in control occurs; (4) continued
medical and dental benefits for Mr. Russell (and eligible dependents) for 36
months; (5) outplacement services for one year; and (6) upon the occurrence of
the change in control, full and immediate vesting of all stock options and
equity awards. The agreement also provides that Mr. Russell is entitled to
receive a gross-up payment on any payments made to Mr. Russell that are subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986,
as amended (the "Code"); provided, however, that if the total payments made to
Mr. Russell do not exceed 110% of the greatest amount that could be paid to Mr.
Russell such that the receipt of payments would not give rise to any excise tax,
then no gross-up payment will be made and the payments made to Mr. Russell, in
the aggregate, will be reduced to an amount that would result in no excise tax
being triggered.
SEPARATION AGREEMENTS
Mr. Will and Mr. Shatto are parties to separation agreements with the
Company whereby the Company has the right at any time with or without prior
written notice to terminate each of their employment or obtain each of their
resignations. The agreements provide that in the event of termination of
employment, the employee will be entitled to receive: (i) one year's salary less
normal withholding; (ii) a pro-rata bonus payment equal to the then current
bonus formula for the time employed in the then current fiscal year up to the
date of termination in that fiscal year less normal withholdings; (iii) a lump
sum payment equal to twelve months of COBRA premiums for the group medical and
dental plans; and (iv) a lump sum payment equal to twelve months car allowance.
In addition, in such event, the employee will be entitled to exercise any vested
or unvested stock options he then has in accordance with the terms of the Stock
Option Plan for a period of one year from the termination of his employment.
COMPENSATION COMMITTEE
Paul A. Biddelman (Chairman)
John Kines
13
STOCK PRICE PERFORMANCE
The following graph compares the cumulative total return to stockholders
of the Company's Common Stock to the cumulative total returns of the Nasdaq
Stock Market - U.S. and the Nasdaq Truck and Transportation Index for the period
June 1998 through June 2003. The graph assumes that $100 was invested on June
30, 1998.
COMPARISON OF CUMULATIVE TOTAL RETURN AMONG
CELADON GROUP, INC.
THE NASDAQ, AND THE TRUCK AND TRANSPORTATION INDEX
COMPANY/INDEX/PEER GROUP 6/30/98 6/30/99 6/30/00 6/30/01 6/30/02 6/30/03
------------------------ ------- ------- ------- ------- ------- -------
Celadon $ 100.00 $ 44.74 $ 59.21 $ 22.63 $ 67.16 $ 47.68
Nasdaq Index $ 100.00 $ 143.67 $ 212.43 $ 115.46 $ 78.65 $ 87.33
Truck & Transportation Index $ 100.00 $ 101.09 $ 77.07 $ 86.46 $ 97.14 $ 107.77
14
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth as of October 1, 2003, certain information
furnished to the Company regarding the beneficial ownership of Common Stock (i)
by each person who, to the knowledge of the Company, based upon filings with the
SEC, beneficially owns more than five percent of the outstanding shares of the
Common Stock, (ii) by each director of the Company, (iii) by each of the Named
Executive Officers, and (iv) by all directors and executive officers of the
Company as a group.
BENEFICIAL OWNERSHIP OF COMMON STOCK AS OF
OCTOBER 1, 2003 (1)
---------------------------------------------
NAME AND
POSITION SHARES %
-------- ------ ----
Stephen Russell ..................................... 688,886 (2) 8.9%
Chairman of the Board and
Chief Executive Officer of the Company
Paul A. Will ........................................ 117,758 (2) 1.5%
Chief Financial Officer, Secretary and Assistant
Treasurer
Jerry Closser ....................................... 83,551 (2) 1.1%
Executive Vice President - Fleet Services
David Shatto ........................................ 75,299 (2) 1.0%
Executive Vice President - Dedicated Operations
and Acquisitions
Thomas Glaser ....................................... 36,934 (2) *
Executive Vice President - Truck Operations/Sales
Michael Dunlap ...................................... 37,000 (2) *
Treasurer and Assistant Secretary
Paul A. Biddelman ................................... 53,500 (2)(3) *
Director of the Company
Michael Miller ...................................... 73,500 (2) *
Director of the Company
Anthony Heyworth .................................... 32,000 (2) *
Director of the Company
John Kines .......................................... 27,000 (2) *
Director of the Company
Trafelet & Company, LLC ............................. 474,191 (4) 6.2%
Dimensional Fund Advisors, Inc. ..................... 521,000 (5) 6.8%
All executive officers and directors as a group
(ten persons) ................................... 1,246,587 16.2%
----------
*Represents beneficial ownership of not more than one percent of the outstanding
Common Stock.
(1) Based upon 7,709,394 shares of Common Stock outstanding at October 1,
2003.
(2) Includes shares of Common Stock which certain directors and executive
officers of the Company had the right to acquire through the exercise of
options within 60 days of October 1, 2003, as follows: Stephen Russell -
188,334 shares; Jerry Closser - 36,668 shares; David Shatto - 55,001
shares; Paul Will - 97,500
15
shares; Thomas Glaser - 28,134 shares; Michael Dunlap - 32,500 shares;
Paul A. Biddelman - 53,500 shares; Michael Miller - 53,500 shares; Anthony
Heyworth - 30,000 shares and John Kines - 22,000 shares.
(3) Does not include shares, if any, beneficially owned by Hanseatic
Corporation, in which Mr. Biddelman is an officer. Mr. Biddelman does not
hold voting or investment power with respect to such shares.
(4) Trafelet & Company, LLC and Remy W. Trafelet share voting and dispositive
power with respect to 474,191 shares of the Company's Common Stock. The
address of Trafelet & Company, LLC and Remy W. Trafelet is c/o 153 E. 53rd
Street, 51st Floor, New York, NY 10022. The foregoing information is based
upon a Schedule 13GA filed by Trafelet & Company, LLC with the SEC on
February 4, 2003.
(5) Dimensional Fund Advisors, Inc. ("Dimensional"), a registered investment
advisor, is deemed to beneficially own 521,000 shares of Common Stock, all
of which shares are held in portfolios of DFA Investment Dimensions Group
Inc., a registered open-end investment company, or in series of the DFA
Investment Trust Company, a Delaware business trust, or the DFA Group
Trust and DFA Participation Group Trust, investment vehicles for qualified
employee benefit plans, all of which Dimensional Fund Advisors, Inc.
serves as investment manager. The address of Dimensional Fund Advisors,
Inc. is 1299 Ocean Avenue, 11th Floor, Santa Monica, CA 90401. The
foregoing information is based upon a Schedule 13GA filed by Dimensional
with the SEC on February 10, 2003.
Except as otherwise indicated, the Company has been advised that the
beneficial holders listed in the table above have sole voting and investment
power regarding the shares shown as being beneficially owned by them. Except as
noted in the footnotes, none of such shares is known by the Company to be shares
with respect to which the beneficial owner has the right to acquire beneficial
ownership.
INDEPENDENT PUBLIC ACCOUNTANTS
The Company's independent public accountants for the fiscal year ended
June 30, 2003 were Ernst & Young LLP ("E&Y"). A representative of E&Y is
expected to attend the Meeting to respond to appropriate questions and make a
statement if they so desire.
Audit Fees. The aggregate fees billed by Ernst & Young LLP for
professional services rendered for the audit of the Company's annual financial
statements for the year ended June 30, 2003 and for the reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-Q for that
year were $157,500. The aggregate fees billed by Ernst & Young LLP for
professional services rendered for the audit of the Company's annual financial
statements for the year ended June 30, 2002 and for the reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-Q for that
year were $144,500.
Audit-Related Fees. There were no audit-related fees in fiscal 2002 or
fiscal 2003.
Financial Information Systems Design and Implementation Fees. There were
no fees billed for professional services rendered for information technology
services design and implementation by Ernst and Young LLP for the year ended
June 30, 2003 or the year ended June 30, 2002.
All Other Fees. The aggregate fees billed by Ernst & Young LLP for
services rendered to the Company, other than services described above, for the
year ended June 30, 2003 were $209,200. The aggregate fees billed by Ernst &
Young LLP for services rendered to the Company, other than services described
above, for the year ended June 30, 2002 were $178,867. Other services include
fees for accounting consulting and tax consulting.
16
The Audit Committee has considered the provision of the services described
above and determined that it is compatible with maintaining the independence of
Ernst & Young LLP.
Although the Company has not yet engaged Ernst & Young LLP as its
independent auditors for the fiscal year ended June 30, 2004, the Audit
Committee will approve in advance any audit services or non-audit services to be
performed by Ernst & Young LLP or other independent auditors. The Audit
Committee approved in advance all services performed by Ernst & Young LLP in
fiscal 2003.
The Audit Committee's policy is to pre-approve all audit and non-audit
services provided by the independent auditors. The Audit Committee may not
engage the independent auditors to perform non-audit services proscribed by law
or regulation. The Audit Committee may delegate pre-approval authority to one of
its members, but the decision of any member to whom pre-approval authority is
delegated must be presented to the full Audit Committee at its next scheduled
meeting.
STOCKHOLDERS' PROPOSALS
In accordance with the proxy rules adopted under the Exchange Act in the
event the Company receives notice of a stockholder proposal to take action at
the Meeting that is not submitted for inclusion in the Company's proxy
materials, the persons named on the proxy sent by the Company to its
stockholders intend to exercise their discretion to vote on such proposal in
accordance with their best judgment, if notice of the proposal is not received
at the Company's administrative office by September 4, 2003. The Company has not
received notice of any such proposals as of the date of this proxy statement,
and, accordingly, the persons named on the proxy will exercise their discretion
with respect to any such proposals.
STOCKHOLDER PROPOSALS FOR THE 2004 ANNUAL MEETING. Stockholders interested
in submitting a proposal for inclusion in the proxy materials for the Company's
annual meeting of stockholders in 2004 may do so by following the procedures
prescribed in SEC Rule 14a-8. To be eligible for inclusion, stockholder
proposals must be received by the Company's Corporate Secretary no later than
June 30, 2004
GENERAL
The Board of Directors does not know of any matters other than those
specified in the Notice of Annual Meeting of Stockholders that will be presented
for consideration at the meeting. However, if other matters properly come before
the meeting, it is the intention of the persons named in the enclosed proxy to
vote thereon as directed by a majority of the Board of Directors in their best
judgment. In the event that any nominee is unable to serve as a director at the
date of the meeting, the enclosed form of proxy will be voted for any nominee
who shall be designated by the Board of Directors to fill such vacancy.
The Company intends to furnish to its stockholders a copy of the Company's
2003 Annual Report on Form 10-K filed with the SEC.
Indianapolis, Indiana
17
APPENDIX A
CELADON GROUP, INC.
AUDIT COMMITTEE CHARTER
ORGANIZATION
This charter governs the operations of the audit committee. The committee shall
review and reassess the charter at least annually and obtain the approval of the
board of directors. The committee shall be members of, and appointed by, the
board of directors and shall comprise at least three directors, each of whom are
independent of management and the Company. Members of the committee shall be
considered independent as long as they do not accept any consulting, advisory,
or other compensatory fee from the Company and are not an affiliated person of
the Company or its subsidiaries, and meet the independence requirements of the
stock exchange listing standards. All committee members shall be financially
literate, and at least one member shall be a "financial expert," as defined by
SEC regulations.
PURPOSE
The audit committee shall provide assistance to the board of directors in
fulfilling their oversight responsibility to the shareholders, potential
shareholders, the investment community, and others relating to: the integrity of
the Company's financial statements; the financial reporting process; the systems
of internal accounting and financial controls; the performance of the Company's
internal audit function and independent auditors; the independent auditor's
qualifications and independence; and the Company's compliance with ethics
policies and legal and regulatory requirements. In so doing, it is the
responsibility of the committee to maintain free and open communication between
the committee, independent auditors, the internal auditors, and management of
the Company.
In discharging its oversight role, the committee is empowered to investigate any
matter brought to its attention with full access to all books, records,
facilities, and personnel of the Company and the authority to engage independent
counsel and other advisers as it determines necessary to carry out its duties.
DUTIES AND RESPONSIBILITIES
The primary responsibility of the audit committee is to oversee the Company's
financial reporting process on behalf of the board and report the results of
their activities to the board. 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 and are in accordance with
generally accepted accounting principles.
1
Management is responsible for the preparation, presentation, and integrity of
the Company's financial statements and for the appropriateness of the accounting
principles and reporting policies that are used by the Company. The independent
auditors are responsible for auditing the Company's financial statements and for
reviewing the Company's unaudited interim financial statements.
The committee, in carrying out its responsibilities, believes its policies and
procedures should remain flexible, in order to best react to changing conditions
and circumstances. The committee should take appropriate actions to set the
overall corporate "tone" for quality financial reporting, sound business risk
practices, and ethical behavior. The following shall be the principal duties and
responsibilities of the audit committee. These are set forth as a guide with the
understanding that the committee may supplement them as appropriate.
The committee shall be directly responsible for the appointment, retention, and
termination of the independent auditors (subject, if applicable, to shareholder
ratification), and the independent auditors must report directly to the audit
committee. The committee also shall be directly responsible for the oversight of
the work of the independent auditors, including resolution of disagreements
between management and the auditor regarding financial reporting. The committee
shall pre-approve all audit and non-audit services provided by the independent
auditors and shall not engage the independent auditors to perform the specific
non-audit services proscribed by law or regulation. The committee may delegate
pre-approval authority to a member of the audit committee. The decisions of any
audit committee member to whom pre-approval authority is delegated must be
presented to the full audit committee at its next scheduled meeting.
At least annually, the committee shall obtain and review a report by the
independent auditors describing:
- The firm's internal quality control procedures.
- Any material issues raised by the most recent internal quality control
review, or peer review, of the firm, or by any inquiry or investigation by
governmental or professional authorities, within the preceding five years,
respecting one or more independent audits carried out by the firm, and any
steps taken to deal with any such issues.
- All relationships between the independent auditor and the Company (to
assess the auditor's independence).
In addition, the committee shall set clear hiring policies for employees or
former employees of the independent auditors that meet the SEC regulations and
stock exchange listing standards.
The committee shall discuss with the independent auditors the overall scope and
plans for their respective audits, including the adequacy of staffing and
compensation. Also, the committee shall discuss with management and the
independent auditors the adequacy and effectiveness of the accounting and
financial controls, including the Company's policies and procedures to assess,
monitor, and manage business risk, and legal and ethical compliance programs
(e.g., Company's Code of Conduct).
2
The committee shall meet separately periodically with management and the
independent auditors to discuss issues and concerns warranting committee
attention. The committee shall provide sufficient opportunity for the
independent auditors to meet privately with the members of the committee. The
committee shall review with the independent auditor any audit problems or
difficulties and management's response.
The committee shall receive a report from the independent auditor, prior to the
filing of its audit report with the SEC, on all critical accounting policies and
practices of the Company, all material alternative treatments of financial
information within generally accepted accounting principles that have been
discussed with management, including the ramifications of the use of such
alternative treatments and disclosures and the treatment preferred by the
independent auditor, and other material written communications between the
independent auditor and management.
The committee shall review management's assertion on its assessment of the
effectiveness of internal controls as of the end of the most recent fiscal year,
subsequent to the effective date of Section 404 of the Sarbanes-Oxley Act of
2002, and the independent auditors' report on management's assertion.
The committee shall review and discuss earnings press releases, as well as
financial information and earnings guidance provided to analysts and rating
agencies.
The committee shall review the interim financial statements and disclosures
under Management's Discussion and Analysis of Financial Condition and Results of
Operations with management and the independent auditors prior to the filing of
the Company's Quarterly Report on Form 10-Q. Also, the committee shall discuss
the results of the quarterly review and any other matters required to be
communicated to the committee by the independent auditors under generally
accepted auditing standards.
The committee shall review with management and the independent auditors the
financial statements and disclosures under Management's Discussion and Analysis
of Financial Condition and Results of Operations to be included in the Company's
Annual Report on Form 10-K (or the annual report to shareholders if distributed
prior to the filing of Form 10-K), including their judgment about the quality,
not just the acceptability, of accounting principles, the reasonableness of
significant judgments, and the clarity of the disclosures in the financial
statements. Also, the committee shall discuss the results of the annual audit
and any other matters required to be communicated to the committee by the
independent auditors under generally accepted auditing standards.
The committee shall establish procedures for the receipt, retention, and
treatment of complaints received by the issuer regarding accounting, internal
accounting controls, or auditing matters, and the confidential, anonymous
submission by employees of the issuer of concerns regarding questionable
accounting or auditing matters.
The committee shall receive corporate attorneys' reports of evidence of a
material violation of securities laws or breaches of fiduciary duty.
3
The committee also prepares its report to be included in the Company's annual
proxy statement, as required by SEC regulations.
The committee shall perform an evaluation of its performance at least annually
to determine whether it is functioning effectively.
4
PROXY
CELADON GROUP, INC.
9503 EAST 33RD STREET
ONE CELADON DRIVE
INDIANAPOLIS, INDIANA 46235-4207
ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints Stephen Russell, Paul Biddelman and Paul
A. Will and each of them with full power of substitution, proxies of the
undersigned, to vote all shares of Common Stock of Celadon Group, Inc. (the
"Company") that the undersigned would be entitled to vote if personally present
at the Annual Meeting of Stockholders of the Company to be held on Friday,
November 21, 2003 at 10:00 a.m. (local time) at the Company's corporate
headquarters located at One Celadon Drive, Indianapolis, Indiana 46235, and at
any adjournment or postponement thereof. The undersigned hereby revokes any
proxy heretofore given with respect to such shares.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED IN PROPOSAL 1. IF MORE THAN ONE
OF SAID PROXIES OR THEIR SUBSTITUTES SHALL BE PRESENT AND VOTE AT SAID MEETING,
OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF, A MAJORITY OF THEM SO PRESENT AND
VOTING (OR IF ONLY ONE TO BE PRESENT AND VOTE, THEN THAT ONE) WILL HAVE AND MAY
EXERCISE ALL THE POWERS HEREBY GRANTED.
------------------------ ---------------------
SEE REVERSE SEE REVERSE
SIDE SIDE
------------------------ ---------------------
CELADON GROUP, INC. VOTE BY MAIL
9530 EAST 33RD STREET Mark, sign, and date your proxy card
and return it in the postage-paid
envelope we have provided or return
it to Celadon Group, Inc., c/o ADP,
51 Mercedes Way, Edgewood, NY 11717.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: CD
--------------------------------------------------------------------------------
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED
--------------------------------------------------------------------------------
CELADON GROUP, INC.
This Proxy, when properly executed and returned, will be voted in the
manner directed below. If no direction is made, this Proxy will be voted
FOR all nominees.
FOR WITHHOLD
1. Election of Directors ALL ALL
[ ] [ ]
Nominees: (01) Stephen Russell, (02) Paul A. Biddelman,
(03) Michael Miller, (04) Anthony Heyworth,
(05) John Kines
[ ] For, except vote withheld from the following nominee(s): __________________
2. In their discretion, the proxies are authorized to vote upon each other
matter that may properly come before the meeting or any adjournments
thereof.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE IN THE USA.
MARK HERE FOR ADDRESS CHANGE AND
NOTE AT RIGHT. [ ]
Please sign below exactly as your name appears. When shares are held by joint
tenants, both shall sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by president or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
--------------------------------------------------------------------------------
Signature (PLEASE SIGN WITHIN BOX) Date Signature
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