SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of
the Securities Exchange Act of 1934 (Amendment No. )
Check the appropriate box:
/X/ Preliminary Information Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
/ / Definitive Information Statement
GASEL TRANSPORTATION LINES, INC.
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(Name of Registrant As Specified In Its Charter)
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[Gasel letterhead & logo]
June 28, 2001
Dear Shareholder:
It is once again my pleasure to invite you to attend the Annual Meeting of
Shareholders and to share with you my view of the events of the past year, our
financial results, and the Company's current and future endeavors.
Even though our first quarter in 2001 shows positive earnings for your Company,
2000 was an extremely tough year for us, as well as the industry. The Company
suffered a loss for the first time in its history as the industry experienced
its worst fall out since deregulation.
Last year was a tremendous struggle but also a turning point for the Company.
The struggle was to survive the financial burdens brought about by the Company's
internal growth and the external pressures from rising industry costs and an
economic slowdown.
These two sets of influences occurring simultaneously and persisting throughout
the year (and continuing in 2001) exposed several strategic and operating
changes the Company needed to make to operate profitably.
I am pleased to tell you we have survived the most volatile year ever seen in
the truckload carrier industry. Some industry analysts have described the
industry conditions in the past year (and continuing into 2001) as "the perfect
storm" with every major factor pressuring returns.
Yet, I believe there are a lot of opportunities for growth in revenues and
earnings as the industry continues to shake out, as I will explore with you in
this communication.
As a result of primarily external conditions, the Company lost approximately
$1.05 million after taxes on revenues of slightly more than $13.0 million, even
though revenues were up over last year by more than $1.5 million due to the
increase in the fleet size in early 2000.
Despite the heavy losses, the Company remained with shareholders' equity of
approximately $1.4 million at year-end. Our current challenge is to continue
restoring the Company to positive earnings and eliminate a related negative cash
impact.
I think it is important for you to know that we have continued to make
improvements in the Company's resources to service our customers and remain
competitive.
Throughout the year investments were made in technology, revenue equipment,
organizational additions, productivity improvements, and cost reduction
programs.
To highlight some of the major improvements, we have completed the
installation of a new state-of-the-art computer system, installed a wireless
communications/satellite tracking system in each of the trucks, became a
Securities and Exchange Commission "SEC" reporting company, completed our
first ISO (customer service/quality program) audit with flying colors, added
two driver training schools, completed the PTDI certification on our
Marietta driver training school, and added industry experienced management in
sales, quality control, safety, and administration.
To generate positive earnings, the Company initiated an aggressive profit
improvement program during the second quarter of 2000. The earnings improvements
were primarily aimed at offsetting the rising fuel costs, reducing mileage
without freight (deadhead miles), increasing equipment productivity, and
generally reducing major operating costs.
Perhaps our greatest accomplishment and of the most potential benefit to the
Company was the acquisition of the brokerage and trucking business, and certain
revenue equipment of Eagle Transportation Services, Inc. and related companies.
Eagle is a Columbus, Ohio-based truckload carrier and brokerage operation. The
Company and Eagle has been such a good fit with one another, operationally the
transaction may be better described as a merger in that Eagle brings a
complimentary customer base, and marketing and freight brokerage expertise where
the Company provides operations expertise. Combined we believe the two
operations make a much stronger entity.
Eagle is proving to provide those attributes to the Company. Specifically, Eagle
adds the following to the Company: (1) approximately $9 million in additional
revenues, (2) a new customer base in strategic geographic areas (to improve
outbound and inbound freight rates and volume), (3) proven successful sales and
operations management, and (4) a presence in Columbus, Ohio where we can build
higher volume and more profitable originating and terminating freight.
I believe these contributions put the Company in a much better position
strategically to overcome the internal and external challenges facing the
Company.
As I mentioned earlier, 2000 was also a turning point for the Company. I am
pleased to announce a modest profit was posted for the first quarter of this
year, indicating, in my opinion, the corrective actions and Eagle addition are
taking effect.
The Q-1 2001 pre-tax earnings were approximately $70,000, slightly better than
our projections. Although the profit is relatively small, we feel it shows a
tremendous turnaround from the heavy losses incurred in three of the four
quarters of last year.
It is our plan for 2001 to continue increasing the Company's revenue and
reducing costs through better equipment utilization and additional freight
volume. An opportunity most recently fulfilled is that the Company has been
awarded approximately 5,000 loads a year from Abbott Laboratories, a world class
manufacturer of pharmaceutical and food products, with expectations to secure an
additional 2,000 loads at very attractive freight rates. This will potentially
provide the Company with the sought after additional freight volume and replace
lesser paying inbound freight.
Incidentally, the Company's website is now on line and has many features we
believe you will find interesting and exciting. I invite you to check it out at
www.gasel.net.
In closing, let me say again that it has been a challenge for the Company and
the truckload industry. However, it is our hope we have not only survived, but
with the structural and operational changes that have been made (and are
continuing to make), the Company is in a position to grow and earn, and maximize
its shareholders value. I anticipate a good year in 2001 and hope to report much
better news to you next year.
Enclosed are a number of documents, including a Notice of Annual Meeting, an
Information Statement, and the Company's Annual Report on the 10-KSB and the
quarterly report for the first quarter of 2001 on the 10-QSB.
I would like to thank you, the shareholders, for your continued trust in our
Company. We will continue to try and retain it.
Michael J. Post
President
[Gasel letterhead & logo]
NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS
Gasel Transportation Lines, Inc.
The Annual Meeting of the shareholders of Gasel Transportation Lines, Inc.,
will be held at the Lafayette Hotel, corner of Front & Green Streets in historic
downtown Marietta, Ohio 45750 on Monday, July 23, 2001 at 1:00 p.m. for the
following purposes:
1. The election of directors.
2. To increase the authorized common shares, without par value, from
3,000,000 common shares, without par value, to 10,000,000 common
shares, without par value.
3. To authorize the selection of Van Krevel & Company as auditors for the
fiscal year 2001.
4. For the transaction of such other business as may be brought before
the meeting or any adjournment thereof.
Only those persons who were stockholders of record on or before July 13,
2001, may vote their shares at such meeting.
A copy of our annual report on Form 10-KSB for the year ended December 31 2000
and a copy of our quarterly report on From 10-QSB for the quarter ended March
31, 2001 are enclosed together with an Information Statement. The Form 10-KSB
includes information about our operations during the year and our audited fiscal
year financial statements. The Form 10-QSB contains information about our
operations during the first quarter ending March 31, 2001 and unaudited
financial statements for that period.
Except to the extent that they are incorporated by reference in the Information
Statement, the Form 10-KSB, and the Form 10-QSB do not constitute information
material in connection with the Annual Meeting.
Our Board of Directors has approved the amendment of the Certificate of
Incorporation.
WE ARE NOT ASKING YOU FOR A PROXY, AND YOU ARE REQUESTED NOT TO SEND US ONE,
WITH RESPECT TO THE AMENDMENT. WE ARE SENDING THIS INFORMATION STATEMENT TO YOU
ONLY FOR INFORMATIONAL PURPOSES.
For additional information about us, please refer to our Annual Report on Form
10-KSB for the year ended December 31, 2000, and the other periodic filings we
have made with the Securities and Exchange Commission ("SEC"), which are
incorporated herein by this reference. A copy of our Annual Report is being
furnished to you with the Information Statement. If you would like copies of any
of those documents, you can request (by phone or in writing) copies of them by
sending your request to our principal office: Gasel Transportation Lines, Inc.
P.O. Box 1199, Marietta, OH 45750, telephone (740) 373-6479, Attn: Allan M.
Blue, Ass't Secretary. We will not charge you for any of the copies. You can
also obtain copies of those documents from the electronic filing site maintained
by the SEC on the world-wide web (www.sec.gov/archives/edgar), from the SEC's
office at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C.
20549 or the various regional SEC offices.
By order of the Board of Directors of the corporation.
John Jackson
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Secretary
INFORMATION STATEMENT
This Information Statement is being is first being furnished on or about June
30, 2001, to our shareholders of record as of the close of business on July 13,
2001, for use at the Annual Meeting of Shareholders to be held July 23, 2001, at
1:00 p.m., local time, or at any and all continuation(s) or adjournment(s)
thereof, for the purposes set forth herein and in the accompanying Notice of
Annual Meeting. The Annual Meeting will be held at the Lafayette Hotel, corner
of Front & Green Streets, Marietta, Ohio.
The purpose of the meeting is to take action with respect to the following
proposals: (1) the amendment of our Amended Articles of Incorporation, (2), the
election of Directors, and (3) to authorize the selection of Van Krevel &
Company as our auditors for the fiscal year 2001. The amendment to our Articles
of Incorporation, which is described in more detail below, will authorize an
increase in the Common Shares, no par value, from 3,000,000 shares to 10,000,000
shares. Our Board of Directors has approved the amendment of the Articles of
Incorporation. WE ARE NOT ASKING YOU FOR A PROXY, AND YOU ARE REQUESTED NOT TO
SEND US ONE, WITH RESPECT TO THE AMENDMENT. WE ARE SENDING THIS INFORMATION
STATEMENT TO YOU ONLY FOR INFORMATIONAL PURPOSES AND SO THAT YOU MAY ATTEND THE
ANNUAL SHAREHOLDER MEETING AND CAST YOUR VOTES WITH REGARD TO THIS MATTER.
Proxies are not being solicited because the officers and directors holding
enough shares to effect the proposed actions have previously indicated their
intention to vote in favor of such proposals.
For additional information about us, please refer to our Annual Report on Form
10-KSB for the year ended December 31, 2000, and the other periodic filings
(including our quarterly reports on Form 10-QSB and our periodic report on Form
8-K) we have made with the Securities and Exchange Commission ("SEC"), which are
incorporated herein by this reference. A copy of our Annual Report on the Form
10-KSB and the first quarter of 2001 report on Form 10-QSB is being furnished to
you with this Information Statement. If you would like copies of any of those
other documents that are filed with the SEC, or the exhibits to the enclosed
forms, you can request (by phone or in writing) copies of them by sending your
request to our principal office: P.O. Box 1199, Marietta, OH 45750, Attn: Allan
M. Blue, Ass't Secretary. We will not charge you for any of the copies. You can
also obtain copies of those documents from the electronic filing site maintained
by the SEC on the world-wide web (www.sec.gov/archives/edgar), from the SEC's
office at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C.
20549 or the various regional SEC offices.
PROPOSAL NO. 1--AMENDMENT TO THE CERTIFICATE OF INCORPORATION--
Our authorized capital currently consists of 3,000,000 Common Shares, no par
value. Our Board of Directors have determined that it would be in our best
interest to amend our Articles of Incorporation to increase the number of shares
to 10,000,000 Common Shares, no par value, to have shares available to grant
stock options to key employees or personnel of the Company in the event of the
adoption of a stock option plan, for issuance in connection with an acquisition
or acquisitions, and for possible public or private sale to raise capital for
the Company. The amendment to the Articles of Incorporation will be effected by
a majority of our shareholders entitled to vote at our Annual Meeting and (ii)
filing the Certificate of Amended Articles of Incorporation with the Secretary
of State for the State of Ohio. On May 4, 2001, our Board of Directors approved
the amendment to our Articles of Incorporation by unanimous vote. In approving
the amendment, our Board of Directors considered a number of factors, including
that basically all of the presently authorized Common Shares have been issued or
are subject to options to purchase, that we need to provide incentives in order
to obtain or retain valuable personnel, that any additional business
acquisitions will probably require that we pay at least in part through the
issuance of equity in our Company that may require us to issue a substantial
number of Common Shares, and that we may need to raise additional equity capital
through the sale of our Common Shares.
The actions described in this information statement will not afford our
shareholders the opportunity to dissent from the actions described herein, or to
receive an agreed or judicially determined value for their shares.
PROPOSAL NO. 2--ELECTION OF DIRECTORS
The Company's Articles of Incorporation provides that the Board of Directors
shall not consist of less than three, or more, if determined from time to time
by the Board. Directors, and are to serve for one-year terms. At the 2001 Annual
Meeting, three Directors are to be elected to hold office for the term expiring
at the next annual meeting of the shareholders to be held in 2002, and until
his/her successor has been elected and qualified, or until his/her death,
resignation or removal, if earlier. Nominees Michael J. Post, Ronald L. Bishop
and Allan M. Blue have been nominated for election to the Board for terms
expiring in 2002. Messrs. Post, Bishop and Blue are current members of the
Board. Certain information regarding each nominee is set forth below:
Michael J. Post has been with the Company since he formed it in January
1988 and has served as President, Treasurer, and Director from then to the
present. He also serves as a board member of Selby General Hospital,
Marietta, Ohio.
Allan M. Blue has been a Director of the Company since 1995 and Assistant
Secretary since 1997. Mr. Blue is a practicing attorney in the Columbus
Ohio area where he has been engaged in private law practice since 1971. In
addition to practicing law, Mr. Blue is actively engaged in several
businesses as owner,
officer, and director. These businesses include The Oak Furniture Showroom,
Inc., Held Team Partnership, d/b/a Hold More Self Storage, Capitol Stock
Transfer Company and Team Investors, Ltd. Additionally, he is a registered
Contract Advisor with the NFLPA representing professional football players
as a partner in the Next Level Sports Management & Marketing Group, Ltd.
Ronald K. Bishop, Director of Company since 1994. Since 1987, he has worked
for Bennco Incorporated as General Manager of 3 radio stations, WDMX, WNUS,
and WLTP, in Parkersburg, West Virginia; recently he also became General
Manager of 2 additional stations, WRVB, and WRZZ. He also serves as a board
member of Selby General Hospital, Marietta, Ohio, Ohio Valley Chamber of
Commerce, and for the Marietta Community Foundation, Easter Seals and the
American Heart Association in the Marietta area.
Meetings and Committees of the Board of Directors: The Board of Directors held
two meetings during 2000. The Company presently has an audit committee
consisting of one non-employee director and two officers.
Compensation to Directors: The Directors received $250 per meeting as
compensation for their services in such office during 2000; the Company intends
to pay $1,000 per meeting as compensation during the current year and ensuing
years.
Stock Options/Consulting Fees: The Directors received no stock option grants or
consulting fees for their services in such office during 2000; no plans
currently exist to make any such grants or payments in the current year.
EXECUTIVE OFFICERS
Below are the names and ages of the executive officers of Gasel Transportation
Lines, Inc. as of June 1, 2001, and a brief description of their prior
experience and qualifications.
NAME AGE POSITION WITH COMPANY
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Michael J. Post 54 Chief Executive Officer,
President, Treasurer, and
Director
John Jackson 55 Vice President-Operations-
Gasel Marietta Division, and
Secretary
S. Gene Thompson 52 Vice President-Chief
Financial Officer
William Cruikshank 60 Vice President-Operations
& Sales
Allan M. Blue 59 Director and Assistant
Secretary
Ronald E. Flowers 52 President-Eagle Division
Michael J. Post has been in all of such capacities from the formation of the
Company in January 1988 to date. He also serves as a board member of Selby
General Hospital, Marietta, Ohio.
John Jackson has been involved in such capacities since the formation of the
Company in 1988.
S. Gene Thompson, Vice President and Chief Financial Officer was elected to
those positions on May 4, 2001. Previously, he acted as a financial consultant
to the Company since early in 2000, and previous to that time, for a period of
one year, he acted in a similar capacity to Sunland Distribution, a
transportation company with its offices in Florida. Before that, for three years
he was General Manager at Holiday Island Resort, a 5,000 acre resort community.
He has a MBA from the University of Arkansas.
William Cruikshank, Vice President of Operations was elected to that position on
May 4, 2001. Since 1998, he had been involved with Eagle Transportation
Services, Inc. as a marketing and operations advisor and was working for the
Company after it acquired Eagle Transportation Services, Inc. at the beginning
of this year. He has over 30 years experience in the trucking industry in
operations and sales, including having owned and operated a trucking company of
his own in Tulsa, Oklahoma. From 1990 to 1997 he was the National Sales Manager
for Bama Transport, a national trucking company.
Allan M. Blue has been a director since 1995 and Assistant Secretary since 1997.
Mr. Blue is a practicing attorney in the Columbus Ohio area where he has been
engaged in private law practice since 1971. In addition to practicing law, Mr.
Blue is actively engaged in several businesses as owner, officer, and director.
These businesses include The Oak Furniture Showroom, Inc., Held Team
Partnership, d/b/a Hold More Self Storage, Capitol Stock Transfer Company and
Team Investors, Ltd.
Ronald E. Flowers, President of Eagle Division, commencing January 1, 2001. Mr.
Flowers, together with his wife Cynthia K. Flowers, are the owners of Eagle
Transport, Inc. and Eagle Transportation Services, Inc., and as such he was the
CEO for the business operations that the Company acquired from those companies.
In order to maintain continuity in the relationships and as part of the terms of
the acquisition, Mr. Flowers has been retained as President of those operations
and they have been designated by the Company as the Eagle Division. Mr. Flowers
continues to own the warehousing operation where the Eagle Division rents office
and terminal space. For the past eleven years, he has been the President of
Eagle Transport, Inc. and Eagle Transportation Services, Inc. engaged in the
transportation and warehousing business.
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding compensation paid
during each of the Company's last three fiscal years to the Company's current
chief executive officer (the "Named Executive Officers"). No other executive
officer had total compensation in fiscal year 2000 (based on salary and bonus)
exceeding $100,000.
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SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION
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ANNUAL COMPENSATION AWARDS
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Name and Principal Year Salary Securities Underlying Options/SAR
Position
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Michael J. Post, President 1998 $49,742 60,000(1)
1999 $63,750
2000 $64,995(2)
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(1) Adjusted for two 2 for 1 stock splits.
(2) In addition, the Company provides a 2001 Ford Expedition sport utility
vehicle for use by Michael J. Post; because he uses the vehicle primarily
for Company business, no value is assigned as compensation for use of the
vehicle.
BENEFICIAL OWNERSHIP
The following table sets forth certain information regarding the beneficial
ownership of our outstanding securities as of June 1, 2001, by the following
parties: all those persons or entities known by us to be beneficial owners of 5%
or more of each class of our outstanding securities, or "5% Shareholders;" each
director and each of our Chief Executive Officer and the next four highest paid
officers, or our Named Executive Officers; and all directors and our executive
officers as a group.
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TITLE OF CLASS NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT OF CLASS
BENEFICIAL OWNER BENEFICIAL OWNER
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Common shares Michael J. Post 1,287,794(1) 53.4
118 Merryhill Street
Marietta, Ohio 43750
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Common shares Allan M. Blue 48,448(2) 2.0
1130 Berlin Station Rd.
Delaware, Ohio 43015
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Common shares Ronald K. Bishop 11,272 0.5
305 Ohio Street
Marietta, Ohio 45750
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Common shares John Jackson 45,780 1.9
Route 2, Box 344
Belpre, Ohio 45714
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Common shares Ronald E. Flowers 175,000(3) 7.3
5703 Southby Ct.
Dublin, Ohio 43017
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Common shares Directors, officers and 1,568,294 65.0
5% shareholders as a
group
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(1) Includes 4,100 shares held by the estate of Mrs. Lee Post, the mother of
Michael J. Post, 31,150 held by Janet Post, wife of Michael J. Post and 7,900
shares held by the Company.
(2) Includes 26,420 shares held by Joyce M. Blue, wife of Allan M. Blue.
(3) Includes 175,000 shares held by Eagle Transportation Services, Inc., a
company owned by Ronald Flowers and his wife, Cynthia Flowers.
PROPOSAL NO. 3--SELECTION OF INDEPENDENT AUDITORS FOR 2001
Van Krevel & Company has served as the Company's principal independent
accountant to audit the Company's financial statements for the fiscal years 1997
through 2000. The Company intends to select them to audit the Company's
financial statements for the year 2001 and will make such a proposal at the
Annual Meeting of Shareholders.
COMPLIANCE WITH REPORTING REQUIREMENTS OF EXCHANGE ACT
Section 16 of the Securities Exchange Act of 1934, and the rules promulgated
thereunder, requires the Company's officers, directors, and holders of 10% or
more of its outstanding common stock to file certain reports with the Securities
and Exchange Commission. To the Company's best knowledge, based solely on
information provided to it by the reporting individuals, all of the reports
required to be filed by these individuals have been filed.
OTHER MATTERS
The Board of Directors is not aware that any matter other than those described
in the Notice of Annual Meeting of Shareholders will be presented for action at
the meeting.
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
Van Krevel & Company has served as the Company's principal independent
accountant since 1997. A representatives of Van Krevel & Company is expected to
be present at the Annual Meeting and will have the opportunity to make a
statement, if they desire to do so, and to respond to appropriate questions.
SHAREHOLDER PROPOSALS FOR THE 2001 ANNUAL MEETING
All shareholder proposals intended to be presented at the 2001 Annual Meeting of
Shareholders must be received by the Company at its offices on or before July
15, 2001.
REPORT ON FORM 10-KSB
A copy of the Company's Annual Report on Form 10-KSB for the year ended December
31, 2000, accompanies the Notice of Annual Meeting of the Shareholders and this
Information Statement.
It is important that you attend the Annual Meeting in person to vote.
For the Board of Directors,
MICHAEL J. POST,
CHIEF EXECUTIVE OFFICER
AND PRESIDENT
June 30, 2001
Marietta, Ohio