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Saia DEF 14A 2007 Table of Contents
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Saia, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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To Our Shareholders:
We cordially invite you to attend the 2007 annual meeting of
shareholders of Saia, Inc., formerly known as SCS
Transportation, Inc. The meeting will take place at EBC Office
and Conference Center, 11330 Lakefield Dr., Bldg. 2,
Duluth, Georgia 30097 on April 19, 2007, at 10:30 a.m.
local time. We look forward to your attendance, either in person
or by proxy.
The purpose of the meeting is to:
1. Elect three directors, each for a term of three years;
2. Ratify the appointment of KPMG LLP as Saia’s
independent auditors for fiscal year 2007;
3. Consider and vote upon proposed amendments to
Saia’s Amended and Restated 2003 Omnibus Incentive
Plan; and
4. Transact any other business that may properly come
before the meeting and any postponement or adjournment of the
meeting.
Only shareholders of record at the close of business on
March 2, 2007 may vote at the meeting or any postponements
or adjournments of the meeting.
By order of the Board of Directors,
James A. Darby
Secretary
March 16, 2007
Please complete, date, sign and return the accompanying proxy
card or vote electronically via the Internet or by telephone.
The enclosed return envelope requires no additional postage if
mailed in either the United States or Canada.
If you are a registered shareholder, you may elect to have
next year’s proxy statement and annual report made
available to you via the Internet. We strongly encourage you to
enroll in this service. It is a cost-effective way for us to
send you proxy materials and annual reports.
Your vote is very important. Please vote whether or not you
plan to attend the meeting.
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Saia,
Inc.
11465 Johns Creek Parkway Duluth, Georgia 30097
The Board of Directors of Saia, Inc., formerly known as SCS
Transportation, Inc., (“Saia”) is furnishing you this
proxy statement in connection with the solicitation of proxies
on its behalf for the 2007 annual meeting of shareholders. The
meeting will take place at EBC Office and Conference Center,
11330 Lakefield Dr., Bldg. 2, Duluth, Georgia 30097 on
April 19, 2007, at 10:30 a.m. local time. At the
meeting, shareholders will vote on the election of three
directors, the ratification of the appointment of KPMG LLP as
Saia’s independent auditors for fiscal year 2007, will
consider and vote upon proposed amendments to Saia’s
Amended and Restated 2003 Omnibus Incentive Plan, and will
transact any other business that may properly come before the
meeting, although we know of no other business to be presented.
By submitting your proxy (either by signing and returning the
enclosed proxy card or by voting electronically on the Internet
or by telephone), you authorize Herbert A. Trucksess, III,
Chairman of Saia’s Board of Directors, James A. Darby,
Saia’s Vice President — Finance, Chief Financial
Officer and Secretary, and John J. Holland, a director of Saia,
to represent you and vote your shares at the meeting in
accordance with your instructions. They also may vote your
shares to adjourn the meeting and will be authorized to vote
your shares at any postponements or adjournments of the meeting.
Saia’s Annual Report to Shareholders for the fiscal year
ended December 31, 2006, which includes Saia’s audited
annual financial statements, accompanies this proxy statement.
Although the Annual Report is being distributed with this proxy
statement, it does not constitute a part of the proxy
solicitation materials and is not incorporated by reference into
this proxy statement.
We are first sending this proxy statement, form of proxy and
accompanying materials to shareholders on or about
March 16, 2007.
YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND
THE MEETING, PLEASE PROMPTLY SUBMIT YOUR PROXY EITHER IN THE
ENCLOSED ENVELOPE, VIA THE INTERNET OR BY TELEPHONE.
INFORMATION
ABOUT THE ANNUAL MEETING
At the annual meeting, the shareholders will be asked to:
1. Elect three directors, each for a term of three years;
2. Ratify the appointment of KPMG LLP as Saia’s
independent auditors for fiscal year 2007; and
3. Consider and vote upon proposed amendments to
Saia’s Amended and Restated 2003 Omnibus Incentive Plan.
Shareholders also will transact any other business that may
properly come before the meeting. Members of Saia’s
management team and a representative of KPMG LLP, Saia’s
independent auditors, will be present at the meeting to respond
to appropriate questions from shareholders.
The record date for the meeting is March 2, 2007. Only
shareholders of record at the close of business on that date are
entitled to vote at the meeting. The only class of stock
entitled to be voted at the meeting is Saia’s common stock.
Each outstanding share of common stock is entitled to one vote
for all matters before the meeting. At the close of business on
the record date there were 14,327,072 shares of Saia common
stock outstanding.
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If your shares are held by a bank or brokerage firm, you are
considered the “beneficial owner” of shares held in
“street name.” If your shares are held in street name,
these proxy materials are being forwarded to you by your bank or
brokerage firm (the “record holder”), along with a
voting instruction card. As the beneficial owner, you have the
right to direct your record holder how to vote your shares, and
the record holder is required to vote your shares in accordance
with your instructions. If you hold shares beneficially in
street name and do not provide your broker with voting
instructions, your shares may constitute “broker
non-votes.” Generally, broker non-votes occur on a matter
when a broker is not permitted to vote on that matter without
instructions from the beneficial owner and instructions are not
given.
As the beneficial owner of shares, you are invited to attend the
annual meeting. If you are a beneficial owner, however, you may
not vote your shares in person at the meeting unless you obtain
a proxy form from the record holder of your shares.
A quorum must be present at the meeting for any business to be
conducted. The presence at the meeting, in person or by proxy,
of the holders of a majority of the shares of common stock
outstanding on the record date will constitute a quorum. Proxies
received but marked as abstentions or treated as broker
non-votes will be included in the calculation of the number of
shares considered to be present at the meeting.
If a quorum is not present at the scheduled time of the meeting,
the shareholders who are represented may adjourn the meeting
until a quorum is present. The time and place of the adjourned
meeting will be announced at the time the adjournment is taken,
and no other notice will be given.
1. You May Vote by Mail. If you properly
complete and sign the accompanying proxy card and return it in
the enclosed envelope, it will be voted in accordance with your
instructions. The enclosed envelope requires no additional
postage if mailed in either the United States or Canada.
2. You May Vote by Telephone or on the
Internet. If you are a registered shareholder
(that is, if you hold your stock directly and not in street
name), you may vote by telephone or on the Internet by following
the instructions included on the proxy card. If you vote by
telephone or on the Internet, you do not have to mail in your
proxy card. Internet and telephone voting are available
24 hours a day. Votes submitted through the Internet or by
telephone must be received by 11:59 p.m. Eastern time on
April 18, 2007.
If your shares are held in street name, you still may be able to
vote your shares electronically by telephone or on the Internet.
A large number of banks and brokerage firms participate in a
program provided through ADP Investor Communications Services
that offers telephone and Internet voting options. If your
shares are held in an account at a bank or brokerage firm that
participates in the ADP program, you may vote those shares
electronically by telephone or on the Internet by following the
instructions set forth on the voting form provided to you.
3. You May Vote in Person at the
Meeting. If you are a registered shareholder and
attend the meeting, you may deliver your completed proxy card in
person. Additionally, we will pass out written ballots to
registered shareholders who wish to vote in person at the
meeting. Beneficial owners of shares held in street name who
wish to vote at the meeting will need to obtain a proxy form
from their record holder.
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Yes, you may revoke your proxy and change your vote:
Your attendance at the meeting itself will not revoke your proxy
unless you give written notice of revocation to the Secretary
before your proxy is voted or you vote in person at the meeting.
Saia’s transfer agent, UMB Bank, n.a., will tabulate and
certify the votes. A representative of the transfer agent will
serve as an inspector of election.
Your Board recommends that you vote:
If you submit a proxy but do not indicate any voting
instructions, your shares will be voted:
We know of no other business that will be presented at the
meeting. If any other matter properly comes before the
shareholders for a vote at the meeting, however, the proxy
holders will vote your shares in accordance with their best
judgment.
The affirmative vote of a plurality of the votes cast at the
meeting is required to elect the three nominees as directors.
This means that the three nominees will be elected if they
receive more affirmative votes than any other person. If you
vote “Withheld” with respect to one or more nominees,
your shares will not be voted with respect to the person or
persons indicated, although they will be counted for purposes of
determining whether there is a quorum.
If a nominee is unable to stand for election, the Board of
Directors may either reduce the number of directors to be
elected or select a substitute nominee. If a substitute nominee
is selected, the proxy holders will vote your shares for the
substitute nominee, unless you have withheld authority.
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The ratification of the appointment of KPMG LLP as Saia’s
independent auditors requires the affirmative vote of a majority
of the shares present at the meeting in person or by proxy and
entitled to vote.
The approval of the proposed amendments to the Saia, Inc.
Amended and Restated 2003 Omnibus Incentive Plan requires the
affirmative vote of a majority of the shares present at the
meeting in person or by proxy and entitled to vote.
Abstentions will be treated as shares present for quorum
purposes and entitled to vote, so they will have the same
practical effect as votes against a proposal.
Broker non-votes will be treated as shares present for quorum
purposes, but not entitled to vote, so they will not affect the
outcome of any proposal.
PROPOSAL 1
ELECTION
OF DIRECTORS
The Board of Directors currently consists of nine directors
divided into three classes (Class I, Class II and
Class III). Directors in each class are elected to serve
for three-year terms that expire in successive years. The terms
of the Class II directors will expire at the upcoming
annual meeting. The Board of Directors has nominated John J.
Holland, Richard D. O’Dell and Douglas W. Rockel for
election as Class II directors for three-year terms
expiring at the annual meeting of shareholders to be held in
2010 and until their successors are elected and qualified.
Messrs. Holland, O’Dell and Rockel currently serve as
Class II directors.
Each nominee has consented to being named in this proxy
statement and has agreed to serve if elected. If a nominee is
unable to stand for election, the Board of Directors may either
reduce the number of directors to be elected or select a
substitute nominee. If a substitute nominee is selected, the
proxy holders will vote your shares for the substitute nominee,
unless you have withheld authority.
The affirmative vote of a plurality of the votes cast at the
meeting is required to elect the three nominees as directors.
This means that the three nominees will be elected if they
receive more affirmative votes than any other person.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE
“FOR” THE ELECTION OF EACH OF THE THREE NOMINEES.
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The following table sets forth, with respect to each nominee,
the nominee’s name, age, principal occupation and
employment during the past five years, the year in which the
nominee first became a director of Saia and directorships held
in other public companies.
The terms of Saia’s three Class I directors expire at
the annual meeting of shareholders to be held in 2009. The terms
of Saia’s three Class III directors expire at the
annual meeting of shareholders to be held in 2008. The following
tables set forth, with respect to each Class I and
Class III director, his or her name, age, principal
occupation and employment during the past five years, the year
in which he or she first became a director of Saia and
directorships held in other public companies.
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CORPORATE
GOVERNANCE
The system of governance practices followed by the Company is
memorialized in the charters of the three standing committees of
the Board of Directors (the Audit Committee, the Compensation
Committee, and the Nominating and Governance Committee) and in
the Company’s Corporate Governance Guidelines. The charters
and Corporate Governance Guidelines are intended to provide the
Board with the necessary authority and practices to review and
evaluate the Company’s business and to make decisions
independent of the influence of the Company’s management.
The Corporate Governance Guidelines establish guidelines for the
Board with respect to Board meetings, Board composition,
selection and election, director responsibility, director access
to management and independent advisors, and non-employee
director compensation.
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The Corporate Governance Guidelines and committee charters are
reviewed periodically and updated as necessary to reflect
evolving governance practices and changes in regulatory
requirements. The Corporate Governance Guidelines are reviewed
annually and were most recently modified by the Board effective
July 20, 2006. The Audit Committee charter, included as
Exhibit A, was most recently modified by the Board in
January 2007. The Corporate Governance Guidelines and each of
the Board’s committee charters are available free of charge
on the Company’s website (www.saia.com).
The Board of Directors has designated a non-employee director,
Mr. Herbert A. Trucksess, III, as the Chairman of the
Board. Mr. Trucksess formerly served as the Company’s
Chief Executive Officer.
The Board of Directors includes a Lead Independent Director.
The Lead Independent Director is elected annually by the
independent directors. For 2006, the Lead Independent Director
was Douglas W. Rockel. The primary responsibilities of the Lead
Independent Director are to:
The Board of Directors held thirteen meetings in 2006. Each
director attended at least 75% of the meetings convened by the
Board and the applicable committees during such director’s
service on the Board.
Executive sessions of non-employee directors are held as part of
each regularly scheduled meeting of the Board. The sessions are
chaired by the Lead Independent Director. Any non-employee
director can request that an additional executive session be
scheduled.
The Board of Directors has an Audit Committee, a Compensation
Committee and a Nominating and Governance Committee. Current
Committee memberships are as follows:
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Audit
Committee
The Audit Committee has been established in accordance with
Section 3(a)(58)(A) of the Securities Exchange Act of 1934.
The Audit Committee held six meetings in 2006. The functions of
the Audit Committee are described in the Audit Committee charter
and include the following:
Each member of the Audit Committee meets the independence and
experience requirements for audit committee members as
established by The Nasdaq Stock Market. The Board of Directors
has determined that Mr. Olson, Mr. Holland, and
Mr. Olsson are “audit committee financial
experts,” as defined by applicable rules of the Securities
and Exchange Commission.
Compensation
Committee
The Compensation Committee held eight meetings in 2006. The
functions of the Compensation Committee are described in the
Compensation Committee charter and include the following:
Each member of the Compensation Committee meets the definition
of an independent director as established by The Nasdaq Stock
Market.
Nominating
and Governance Committee
The Nominating and Governance Committee held three meetings in
2006. The functions of the Nominating and Governance Committee
are described in the Nominating and Governance Committee charter
and include the following:
Each member of the Nominating and Governance Committee meets the
definition of an independent director as established by The
Nasdaq Stock Market.
Pursuant to the Company’s Corporate Governance Guidelines,
in an uncontested election of directors (i.e., an election where
the only nominees are those recommended by the Board of
Directors), any nominee for director who receives a greater
number of votes “withheld” from his or her election
than votes “for” his or her election will promptly
tender his or her resignation to the Chairman of the Board
following certification of the stockholder vote.
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The Nominating and Governance Committee will promptly consider
the resignation and will recommend to the Board whether to
accept the tendered resignation or reject it. In considering
whether to accept or reject the tendered resignation, the
Nominating and Governance Committee will consider all factors
deemed relevant by the members of the Nominating and Governance
Committee including, without limitation, the stated reasons why
stockholders “withheld” votes for election from such
director, the length of service and qualifications of the
director whose resignation has been tendered, the
director’s contributions to the Company, and the
Company’s Corporate Governance Guidelines. The Board will
act on the Nominating and Governance Committee’s
recommendation no later than 90 days following the date of
the shareholders’ meeting where the election occurred. In
considering the Nominating and Governance Committee’s
recommendation, the Board will consider the factors considered
by the Nominating and Governance Committee and such additional
information and factors the Board believes to be relevant.
Following the Board’s decision on the Nominating and
Governance Committee’s recommendation, the Company will
promptly publicly disclose the Board’s decision whether to
accept the resignation as tendered (providing a full explanation
of the process by which the decision was reached and, if
applicable, the reasons for rejecting the tendered resignation)
in a
Form 8-K
filed with the Securities and Exchange Commission. To the extent
that one or more directors’ resignations are accepted by
the Board, the Nominating and Governance Committee will
recommend to the Board whether to fill such vacancy or vacancies
or to reduce the size of the Board. Any director who tenders his
or her resignation pursuant to this provision of the Corporate
Governance Guidelines will not participate in the Nominating and
Governance Committee recommendation or Board consideration
regarding whether or not to accept the tendered resignation. If
a majority of the members of the Nominating and Governance
Committee received a greater number of votes
“withheld” from their election than votes
“for” their election at the same election, then the
independent directors who are on the Board who did not receive a
greater number of votes “withheld” from their election
than votes “for” their election (or who were not
standing for election) will appoint a Board committee amongst
themselves solely for the purpose of considering the tendered
resignations and will recommend to the Board whether to accept
or reject them. This Board committee may, but need not, consist
of all of the independent directors who did not receive a
greater number of votes “withheld” from their election
than votes “for” their election or who were not
standing for election.
CONSIDERATION
OF DIRECTOR NOMINEES
The Corporate Governance Guidelines include director
qualification standards, which provide as follows:
While the selection of qualified directors is a complex,
subjective process that requires consideration of many
intangible factors, the Corporate Governance Guidelines provide
that directors and candidates for director generally should, at
a minimum, meet the following criteria:
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The Nominating and Governance Committee has adopted policies
concerning the process for the consideration of director
candidates by shareholders. The Nominating and Governance
Committee will consider director candidates submitted by
shareholders of Saia. Any shareholder wishing to submit a
candidate for consideration should send the following
information to the Secretary of the Company, Saia, Inc., 11465
Johns Creek Parkway, Suite 400, Duluth, Georgia 30097:
The Secretary of Saia will promptly forward such materials to
the Nominating and Governance Committee Chair and the Chairman
of the Board of Saia. The Secretary will also maintain copies of
such materials for future reference by the Committee when
filling Board positions.
If a vacancy arises or the Board decides to expand its
membership, the Nominating and Governance Committee will seek
recommendations of potential candidates from a variety of
sources (including incumbent directors, shareholders, the
Corporation’s management and third party search firms). At
that time, the Nominating and Governance Committee also will
consider potential candidates submitted by shareholders in
accordance with the procedures described above. The Nominating
and Governance Committee then evaluates each potential
candidate’s educational background, employment history,
outside commitments and other relevant factors to determine
whether he or she is potentially qualified to serve on the
Board. The Committee seeks to identify and recruit the best
available candidates, and it intends to evaluate qualified
shareholder candidates on the same basis as those submitted by
other sources.
After completing this process, the Nominating and Governance
Committee will determine whether one or more candidates are
sufficiently qualified to warrant further investigation. If the
process yields one or more desirable candidates, the Committee
will rank them by order of preference, depending on their
respective qualifications and Saia’s needs. The Nominating
and Governance Committee Chair, or another director designated
by the Nominating and Governance Committee Chair, will then
contact the desired candidate(s) to evaluate their potential
interest and to set up interviews with the full Committee. All
such interviews are held in person, and include only the
candidate and the Nominating and Governance Committee members.
Based upon interview results, the candidate’s
qualifications and appropriate background checks, the Nominating
and Governance Committee then decides whether it will recommend
the candidate’s nomination to the full Board.
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Separate procedures apply if a shareholder wishes to submit a
director candidate at the Company’s annual meeting that is
not approved by the Nominating and Governance Committee or the
Board of Directors. Pursuant to Section 2.07(a) of the
Amended and Restated By-Laws of the Company, for nominations to
be properly brought before an annual meeting pursuant to clause
(C) of paragraph (a)(i) of Section 2.07 of the
By-Laws, the shareholder must have given timely notice thereof
in writing to the Secretary of the Company. To be timely, a
shareholder’s notice must be delivered or mailed to and
received at the principal executive offices of the Company not
later than the close of business on the
90th calendar
day nor earlier than the 120th calendar day prior to the
anniversary date of the first mailing of the Company’s
proxy statement for the immediately preceding year’s annual
meeting. Such shareholder’s notice shall set forth the
following items:
The foregoing summary is qualified in its entirety by reference
to the Company’s By-Laws, which have been filed with the
Securities and Exchange Commission and copies of which are
available from the Company.
The Board of Directors has adopted the following procedures for
shareholders to send communications to the Board or individual
directors of the Company:
Shareholders seeking to communicate with the Board of Directors
should submit their written comments to the Secretary of the
Company, Saia, Inc., 11465 Johns Creek Parkway, Suite 400,
Duluth, Georgia 30097. The Secretary of the Company will forward
all such communications (excluding routine advertisements and
business solicitations and communications which the Secretary of
the Company, in his or her sole discretion, deems to be a
security risk or for harassment purposes) to each member of the
Board of Directors, or if applicable, to the individual
director(s) named in the correspondence. Subject to the
following, the Chairman of the Board and the Lead Independent
Director will receive copies of all shareholder communications,
including those addressed to individual directors, unless such
communications address allegations of misconduct or
mismanagement on the part of the Chairman. In such event, the
Secretary of the Company will first consult with and receive the
approval of the Lead Independent Director before disclosing or
otherwise discussing the communication with the Chairman.
The Company reserves the right to screen materials sent to its
directors for potential security risks
and/or
harassment purposes, and the Company also reserves the right to
verify ownership status before forwarding shareholder
communications to the Board of Directors.
The Secretary of the Company will determine the appropriate
timing for forwarding shareholder communications to the
directors. The Secretary will consider each communication to
determine whether it should be
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forwarded promptly or compiled and sent with other
communications and other Board materials in advance of the next
scheduled Board meeting.
Shareholders also have an opportunity to communicate with the
Board of Directors at the Company’s annual meeting of
shareholders. The Company’s Corporate Governance Guidelines
provide that absent unusual circumstances, directors are
expected to attend all annual meetings of shareholders. Each of
the directors then-serving on the Board attended the
Company’s 2006 annual meeting of shareholders.
STOCK
OWNERSHIP
Directors
and Executive Officers
The following table sets forth the amount of Saia’s common
stock beneficially owned by each director, each executive
officer, and each former executive officer named in the Summary
Compensation Table on page 22 and all directors and
executive officers as a group, as of January 31, 2007.
Unless otherwise indicated, beneficial ownership is direct and
the person indicated has sole voting and investment power.
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Saia, Inc. (Saia or the Company) is among the leading regional
less-than-truckload
(LTL) companies in the United States, serving the South,
Southwest, Pacific Northwest, Midwest, and Western Regions of
the United States. Saia’s primary long-term corporate
objective is to create superior value for our shareholders. To
achieve this, Saia is committed to delivering
best-in-class
service to our customers, which in turn seeks to produce
continued growth and value not only for shareholders but also
for our employees. To achieve these objectives, the Company has
developed a comprehensive business strategy that emphasizes
long-term value through employee development, operational
excellence and superior financial performance. Saia’s
executive compensation program is designed to further these
objectives. Our executive compensation program is
performance-based, aligns executives’ interests with
shareholders, and rewards executives for achievement of short-
and long-term business performance goals.
The Company’s Executive Compensation Program is
administered by the Compensation Committee of the Board of
Directors (the “Committee”). The Committee, which is
composed entirely of independent directors (as defined in the
applicable rules for The Nasdaq Stock Market, as well as
applicable federal law), is responsible for all components of
Saia’s officer compensation programs. The current Committee
members include Ms. French, Mr. Olsson, and
Mr. Rockel. Ms. French serves as the Committee Chair.
The purpose of the Committee is to aid the Board of Directors in
meeting the responsibilities with regard to oversight and
determination of executive compensation. Among other things, the
Committee reviews, recommends and approves salaries and other
compensation and benefits of executive officers, administers the
equity incentive plans, and administers other awards under the
Omnibus Incentive Plan. A more complete description of the
Committee’s responsibilities is provided in the
Committee’s Charter approved by the Board of Directors,
which can be found on the Company’s website (www.saia.com)
in the investor relations section.
The Committee has the authority to engage the services of
independent compensation consultants and legal advisers. In
2006, the Committee retained the services of Mercer Human
Resource Consulting (“the Consultant”) to advise on
issues related to the Committee’s responsibilities. The
Consultant was selected by the Committee and reports to the
Chair of the Committee. The Committee has the authority to
determine the scope of the Consultant’s services and
retains the right to terminate the Consultant’s contract at
any time.
It is the Company’s belief that the Executive Compensation
Program should (1) link pay and performance and
(2) attract, motivate, reward and facilitate the retention
of the executive talent required to achieve corporate
objectives. The primary long-term corporate objective is to
create value for the Company’s shareholders. To this end,
the Company’s Executive Compensation Program focuses
significantly on long-term stock price performance.
In support of this philosophy, Saia uses several different
executive compensation elements that align rewards with the
short- and long-term performance of the Company and each
executive. These programs are structured to deliver competitive
compensation levels for the achievement of specific performance
objectives.
Our philosophy for each component of pay is as follows:
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The Compensation Committee annually reviews the executive
compensation levels of the Named Executive Officers (i.e.
executive officers disclosed in the Summary Compensation Table
on page 22) using competitive data for similar positions at
other, like-sized companies, generally meaning companies of
one-half to three times our revenues. Data is gathered from
published compensation surveys and the proxy statements from a
group of publicly traded transportation peer companies. The
specific peers included in the review of proxy statements during
2006 were Arkansas Best Corporation, Covenant Transport, Inc.,
HeartLand Express, Inc., Knight Transportation, Inc., Marten
Transportation Ltd., Old Dominion Freight Line, Inc., Quality
Distribution, Inc., U.S. Xpress Enterprise, Inc., USA
Truck, Inc., Vitran Corporation, and Werner Enterprises, Inc.
This review is conducted by the Committee’s Consultant.
While the Committee carefully reviews the competitive
compensation data, other factors considered in determining
appropriate compensation levels include executive experience,
Company performance, individual performance, internal pay
equity, and succession planning. There were no material
differences in the factors considered for each Named Executive
Officer in the decision to increase or decrease compensation.
Regarding the CEO’s compensation, the Committee meets in
executive session to determine the amount, form, and terms of
such compensation for Board approval. For all other officer
compensation decisions, the CEO provides recommendations and may
be present for the decisions and related discussions, but may
not vote.
Components
of the Executive Compensation Program
The primary elements of the Executive Compensation Program are
base salaries, annual incentives, long-term incentives, and
other benefits and perquisites.
The Committee annually reviews all elements of the Named
Executive Officer’s compensation programs relative to the
executive compensation philosophy, including base salaries,
annual incentives, long-term incentives, the dollar value to
executives and cost to the Company of all perquisites and other
personal benefits, the earnings and accumulated payout
obligations under the Company’s non-qualified deferred
compensation program, the actual projected payout obligations
under the Company’s Supplemental Executive Retirement Plan
(applicable only to Mr. Trucksess) and compensation under
several potential severance and
change-in-control
scenarios. This review is conducted through the use of, among
other things, competitive compensation data and tally sheets
that set forth total rewards history, as well as potential
rewards under various employment termination scenarios. Each of
these compensation components are detailed further below.
Base Salaries — Base salaries represent the
fixed portion of the Executive Compensation Program and are
commensurate with the executive’s job level. Base salary
levels for the Named Executive Officers in 2006 were established
through comparisons with the market survey data described above.
Overall, the base salary levels are close to the market
50th percentile, in the aggregate. The Committee’s
intent is to target the marketplace’s 50th percentile
for officer base salaries, over time, based on performance and
growth in the experience of the executives. The specific factors
considered in determining the base salary increases for 2006
were competitive compensation levels, executive experience,
Company performance, individual performance, internal pay equity
and succession planning.
All salaried employees, including the Named Executive Officers,
are eligible for an annual merit increase to base salary. The
targeted 2006 increase budgeted for all officers was 3.5% of
base salary. The average actual merit increase for Named
Executive Officers was 3.2% of base salary. The merit increases
for Mr. Trucksess, Mr. Bellinghausen, and
Mr. Robinson were effective corresponding with the date of
the executive’s last merit increase. For all other Named
Executive Officers, the effective date of the merit increases
was August 1, 2006.
Mr. Trucksess’ salary was increased to $489,258,
reflecting a 3% merit increase for 2006. In connection with the
annual review of Mr. Trucksess’ compensation, the
Committee reviewed an internal equity analysis, comparing
Mr. Trucksess’ compensation as a multiple of average
employee pay by job level.
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In addition to the 2006 annual merit increases, base salary
levels were increased on July 1, 2006 as a result of
promotions and increased job responsibilities associated with
the consolidation and relocation of the holding company. For
those Named Executive Officers receiving such increase, the
average increase was 20% of base salary.
As a result of the 2006 increases in base salary levels, the
compensation that may be earned from the annual and long-term
incentives, the Company’s contribution to the SCST
Executive Capital Accumulation Plan, and severance arrangements
increased for the Named Executive Officers.
Annual Incentive Compensation — The annual
incentive component of the Executive Compensation Program
represents the variable portion of the total compensation
opportunity that motivates and rewards executives to achieve
short-term corporate objectives. Saia’s annual incentive
plan is structured to provide cash incentives to key employees
based on the achievement of key corporate, business unit and
individual objectives for a fiscal year. Under the plan, a
funding pool is created based on the performance of selected
financial goals. For 2006, the corporate performance measure was
earnings per share and the business unit performance measure for
Saia Motor Freight Line, Inc. was business unit operating income
(excluding property gains and losses and integration charges).
These measures were selected based on how well they reflect the
short-term performance of the Company, how well they are
understood by participants, and their alignment with competitive
practice. Saia’s annual incentive plan sets target,
threshold and maximum levels used to determine the payout. These
target payouts range from 30% of base salary to 60% of base
salary for the Company’s Named Executive Officers. Maximum
opportunities for the annual incentive are 200% of the target.
For 2006, the weighting of the performance measures for the
Named Executive Officers were as follows:
The actual incentives paid to Mr. Trucksess and
Mr. Bellinghausen for 2006 were at target levels pursuant
to their severance package associated with their departure as a
result of the consolidation and relocation of the holding
company. For Mr. Robinson for 2006 his incentive was paid
at target for the first half of 2006 consistent with
Mr. Trucksess and Mr. Bellinghausen and his individual
performance levels and was paid using the Saia operating income
metrics and individual performance levels for the second half of
2006. For the other Named Executive Officers, actual annual
incentives paid for 2006 were based on Saia’s operating
income, and individual performance levels. Actual Saia Motor
Freight operating income (excluding property gains and losses
and integration charges) was $59.8 million compared to a
goal of $58.7 million resulting in an incentive of 105.8%
of target for that measure. Individual performance was
determined by reviewing each Named Executive Officer’s
performance relative to pre-established individual performance
goals. The individual goals were selected based on the
respective individual’s areas of responsibility. While most
of the individual performance goals were established with
objective measurement criteria, some discretion is applied in
determining performance levels relative to goals and the
associated individual incentive awards. For 2006, the average
payout for the individual incentive portion of the annual
incentive for Named Executive Officers was 104.3% of target.
For 2007, the annual incentive plan for Named Executive Officers
is structured to provide cash incentives to key employees based
on the achievement of corporate earnings per share. This measure
was selected based on how well it is understood by participants
and to align with competitive practice. The weighting of each of
the 2007 performance goals for all of the Named Executive
Officers is 100% on corporate earnings per share.
The EPS performance goals for 2007 were set considering 2006
performance, the strategic plan, and the annual 2007 budget.
Generally, the Committee sets the target level for the EPS goal
at the budget level approved by the
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Board of Directors. Threshold and maximum EPS goals are set
considering competitive goal range spreads and the incremental
earnings between the minimum and target, and target and maximum
goals. For 2007, the threshold EPS goal is above 2006 actual
performance and the target goal is above the average estimate of
the stock analysts who cover the Company.
Over the past five years, the performance at the Company’s
business unit, Saia Motor Freight, has exceeded target incentive
goals four times and has not exceeded the maximum performance
goals. Generally, the Committee sets the threshold, target, and
maximum levels such that the relative difficulty of achieving
the target level is consistent from year to year.
Long-Term Incentive Compensation — The
long-term incentive component of the Executive Compensation
Program represents the variable portion of the total
compensation opportunity that motivates and rewards executives
to achieve long-term corporate objectives. We believe that
executive officers should have an ongoing stake in the success
of the Company and they should have a considerable portion of
their total compensation tied to Company stock price performance
since the primary long-term corporate objective is to create
value for our shareholders. The role of Saia’s long-term
incentives is to reward executives for such long-term
shareholder value creation.
Under the Amended and Restated 2003 Omnibus Incentive Plan,
which was approved by shareholders in 2003 and amendments to
which were approved by shareholders in 2005, the Compensation
Committee has the authority to provide long-term incentives to
key employees using a variety of devices, including stock
options, restricted stock, and performance units. In order to
provide a strong focus on creating value relative to other
companies in our industry, and to tie compensation to
shareholder value creation, the Committee has elected to use a
combination of performance unit awards and stock option grants.
For 2006, 50% of a Named Executive Officer’s long-term
incentive opportunity was granted in performance units and 50%
was in stock options valued using the Black-Scholes option
valuation model. This mix between performance units and stock
options was selected to balance the focus between relative and
absolute stock performance and reflect competitive practices.
The role of the performance units is to reward executives for
long-term value creation relative to peer companies. Under the
performance units granted in 2006, participants will earn cash
awards based on Saia’s total shareholder return (TSR)
performance relative to a group of 30 primarily small and
mid-capitalization trucking transportation and logistics peer
companies over a three-year performance period of
2006 — 2008 with payouts as follows:
At the end of the performance period, the percentile rank of the
Company’s TSR will be calculated. Any Peer Company that is
no longer publicly traded will be excluded from this
calculation. The payout associated with the Company’s
percentile rank will be based on the chart above with payouts
interpolated for performance between the 25th and
50th percentile and the 50th and 75th percentile.
If TSR at the end of the performance period is negative, no
payouts are made under the awards.
Actual awards for the recently completed
2004-2006
performance period, as disclosed in Summary Compensation Table
under Non-Equity Incentive Plan Compensation, were 160% of
target, based on a final determination of TSR over the
performance period, and were paid out during the first quarter
of 2007. Actual awards are not scheduled to be paid out until
the first quarter of 2008 for the
2005-2007
performance period and first quarter of 2009 for the
2006-2008
performance period, based on a final determination of TSR over
the relevant performance period.
The role of the stock options is to reward executives for the
absolute long-term value creation. The Compensation Committee
has the plenary authority to determine when and to whom awards
shall be granted, the term of each award, the number of shares
covered by each award, and all other conditions of the award.
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It has been our practice that the material terms and conditions
of all stock options are established and approved by the
Committee. Specifically, the CEO’s award is determined and
approved by the Compensation Committee. The award levels for the
other Named Executive Officers and other participants are
proposed by the CEO and reviewed and approved by the
Compensation Committee.
The timing of the stock option grants has historically been in
the first quarter of the fiscal year with the exact grant date
corresponding with the date of the meeting of the Compensation
Committee. Saia has not and does not plan to have a practice to
time option award grants made to existing or new executives with
the release of non-public material information. In 2006, the
Company adopted a policy to make regular equity awards (e.g.,
annual grants) to the Company’s executive officers and
directors on the third trading day following the release of the
Company’s financial results for the prior fiscal year
(except as otherwise provided in the Amended and Restated Saia,
Inc. 2003 Omnibus Incentive Plan). The stock option grants to
the Named Executive Officers are approved by the Compensation
Committee on the same day as the grants to other stock option
recipients. The exercise price of the stock options is equal to
the market closing share price of Saia on the grant date.
Stock options granted in 2006 and 2007 have an exercise price
equal to the market closing price of Saia stock on the date of
grant and a three-year cliff vesting schedule and a seven-year
term, except for a special grant of 19,990 options to
Mr. O’Dell made in February 2007 in recognition of his
promotion to CEO which have a ten-year term and vest one-third
in the third year, one-third in the fourth year and one-third in
the fifth year. The three-year cliff vesting schedule is
designed to coincide with payouts under the performance unit
awards made in 2006 and 2007 in order to provide cash to
facilitate the exercise of the stock options and promote
increased stock ownership.
A total of 44,240 non-qualified stock options were granted to
the Named Executive Officers in 2006, representing 60% of the
total stock options granted. In February 2007, the Company
granted a total of 47,860 non-qualified stock options to the
Named Executive Officers, representing 58% of the total stock
options granted.
Benefits and Perquisites — The Company provides
medical, dental, disability, life insurance and defined
contribution retirement benefits, to which substantially all
employees, including the Named Executive Officers, are entitled
to participate. The role of these plans is to provide a
competitive level of health, welfare, and retirement benefits to
substantially all employees. The amounts that the Named
Executive Officers have chosen to contribute to the defined
contribution plan are included in the salary column of the
Summary Compensation Table and the matching contributions are
included in the All Other Compensation column on page 22.
Additional details regarding the design of the defined
contribution retirement benefits are disclosed on page 26.
In addition to the benefits provided to all employees, the
Company provides benefits and perquisites that are limited to
officers. These programs are reviewed annually by the
Compensation Committee regarding their competitiveness and
appropriateness. No modifications were made to these programs in
fiscal year 2006. The officer-only benefits and perquisites are
described below.
The Company provides a non-qualified deferred compensation plan,
titled the SCST Executive Capital Accumulation Plan, to
officers. The role of this plan is to provide the opportunity to
defer taxation on all or a portion of base salary and a portion
of annual incentives through irrevocable elective deferrals, and
to provide a supplemental executive retirement benefit that is
consistent with competitive practices. The amounts which the
Named Executive Officers have chosen to contribute to the SCST
Executive Capital Accumulation Plan are included in the salary
column of the Summary Compensation Table. Additional details of
the Plan are disclosed on page 26.
The Company provides a non-qualified supplemental defined
benefit retirement plan to Mr. Trucksess that is reduced by
amounts received from the SCST Executive Capital Accumulation
Plan. The purpose of this plan is to provide Mr. Trucksess
with approximately the difference between the supplemental
retirement benefits that he would have received under his
previous employment contract with his former employer (Yellow
Corporation, now known as YRC Worldwide Inc.), had
Mr. Trucksess continued his employment with Yellow
Corporation, and the expected actual retirement benefits
Mr. Trucksess is entitled to from Yellow Corporation. This
contractual benefit was negotiated at the time the Company was
formed, when Mr. Trucksess assumed the role of Chairman and
CEO, and is not provided to other executives. This retirement
benefit is payable to Mr. Trucksess upon retirement under
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the SCST Executive Capital Accumulation Plan and his Employment
Agreement. Additional details of the Plan are disclosed on
page 27.
The Company provides limited perquisites to its Named Executive
Officers. The perquisites for the Named Executive Officers
include a car allowance ($7,200 maximum allowance for all Named
Executive Officers), financial/legal planning allowance ($5,000
maximum allowance for Mr. Trucksess and
Mr. O’Dell and $4,000 for other Named Executive
Officers), executive term life insurance ($1,000,000 coverage
for Mr. Trucksess and $500,000 for other Named Executive
Officers), and country club memberships (no maximum level and
provided only to Mr. Trucksess and Mr. O’Dell).
In fiscal 2006, two Named Executive Officers received
perquisites with a value greater than $10,000 as disclosed in
the “All Other Compensation” columns of the Summary
Compensation Table disclosed on page 22.
The Company has entered into Executive Severance Agreements with
all the Named Executive Officers. These executive agreements
provide the executives with severance in the event of a
change-in-control
and termination (i.e., double trigger) without cause or for good
reason. The role of these agreements is to reduce the
distraction that may be caused by the personal uncertainties of
continued employment created by a proposal from a third person
concerning a possible business combination with or acquisition
of equity securities of Saia to be consistent with competitive
practice.
The material terms of the executive severance agreements are
designed to be consistent with competitive practices including a
gross-up
provision for excise taxes. Designing the agreements to be
consistent with competitive practice facilitates our ability to
attract, motivate, reward, and retain the executive talent
required to meet the Company’s business objectives.
The material terms of the executive severance agreements are as
follows:
A summary of the severance arrangements with remaining Named
Executive Officers are as follows:
The rationale for the higher severance multiples and longer
benefits continuation periods for most senior executives is
after termination, there typically is a longer job search period
required to find another comparable position the more senior the
executive. Furthermore, they also are typically at greater risk
of termination in the event of a
change-in-control.
A more detailed description of the specific circumstances that
would trigger severance payouts and the estimated payments and
benefits that would be provided in each covered circumstance for
the Named Executive Officers, assuming that the relevant
triggering event occurred on the last business day of fiscal
2006, are disclosed in the “Potential Payments Upon
Termination or Change in Control” section of this proxy
statement on page 28.
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Mr. Albanese and O’Dell also have severance rights
pursuant to their employment contracts in the event of
termination by Saia for disability, termination without cause,
termination for good reason, or termination by death.
Under such employment contracts, in the event of termination by
Saia for disability or termination by death, the executive is
provided the severance right of immediate vesting of outstanding
stock options. In the event of termination by Saia without cause
or termination for good reason, the executive is provided the
severance rights of base salary continuation for a period of
24 months after termination, pro rata target bonus based on
the actual portion of the fiscal year in which termination of
employment occurs, eligible for payment of retirement benefits
under Saia’s nonqualified defined contribution plan, if
any, continuation for 24 months of benefits plans and
programs that covered them immediately prior to termination of
employment, and immediate vesting of all outstanding stock
options with two years from termination to exercise (but not
beyond the term of such option), and payment of excise tax or
interest or penalties imposed by Section 4999 of the
Internal Revenue Code as a result of payments or benefits
received by the executive. These severance benefits are
conditioned upon the executive’s compliance with
non-competition and non-solicitation provisions. A more detailed
description of the specific circumstances that would trigger
severance payouts and the estimated payments and benefits that
would be provided in each covered circumstance for the Named
Executive Officers, assuming that the relevant triggering event
occurred on the last business day of fiscal 2006, are disclosed
in the “Potential Payments Upon Termination or Change in
Control” section of this proxy statement on page 28.
In the event of termination without cause in situations like a
reduction in workforce that would not be covered by the
Executive Severance Agreements, or for those individuals who do
not have such agreements, the Company has in the past provided a
minimum of 12 weeks of severance compensation for officers.
This practice has provided competitive severance levels to
officers who are not covered by other formal severance
arrangements in the event of termination that typically is
unrelated to an individual’s job performance. The severance
payment supports the former employee for a limited period of
time for the transition from employment at Saia to their next
employer. This is not a formal policy of the Company, but an
informal practice that the Company has the right to modify or
eliminate at anytime.
As of December 31, 2006, Mr. Trucksess ceased to be an
employee of Saia as a result of the sale of Jevic and the
relocation and consolidation of the holding company. He remains
Chairman of the Board of Directors of Saia, Inc. In accordance
with the employment agreement entered into between the Company
and Mr. Trucksess’ (filed as exhibit 10.5 of the
Company’s annual report on
Form 10-K
for the year ended December 31, 2002 and the modification
of the employment agreement dated December 7, 2006 filed as
exhibit 10.1 of the Company’s
Form 8-K
filed on December 13, 2006) Mr. Trucksess will
receive certain termination benefits. The amounts of
Mr. Trucksess’ termination payments are disclosed in
the “Potential Payments Upon Termination or Change in
Control” section of this proxy statement on page 28.
Additionally, Mr. Bellinghausen received termination
benefits in connection with his termination as a result of the
sale of Jevic and the relocation and consolidation of the
holding company effective December 31, 2006.
Mr. Bellinghausen’s termination benefits are disclosed
in the “Potential Payments Upon Termination or Change in
Control” section of this proxy statement on page 28.
Under Section 162(m) of the Internal Revenue Code, publicly
traded companies may not receive a tax deduction on
non-performance-based compensation paid to Named Executive
Officers in excess of $1 million. Saia’s awards of
performance units and stock under the 2003 Omnibus Incentive
Plan qualify as performance-based compensation under the law;
except with respect to performance units and stock options, no
specific actions have been taken with regard to the annual
incentive plan to comply with Section 162(m) at this time,
since only Messrs. Trucksess’ and O’Dell’s
cash compensation has the potential to be effected by the
$1 million limit, and then only in an outstanding
performance year. The rationale for this practice is that from
time to time it may be in the best interests of shareholders to
allow for some flexibility in the manner in which payouts under
the annual incentive plan are determined, to appropriately link
pay and performance.
Section 409A is a section of the Internal Revenue Code
added by the American Jobs Creation Act of 2004 which reforms
the rules for governing nonqualified deferred compensation
(NQDC) plans and arrangements. Section 409A generally
applies to amounts deferred after December 31, 2004.
However, the rules under
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Section 409A would also apply to any amounts deferred prior
to that time if a “material modification” is made to
the plan after October 3, 2004. Amendments have been made
to the Executive Severance Agreements and Employment Agreements
in 2006 to comply with Section 409A. Specifically,
separation payouts to key executives under these agreements have
been delayed for six months as required under Section 409A.
Aggregate amount of the delayed payments shall be paid in a lump
sum, plus interest on such amount based on the six-month
Treasury Bill rate calculated from the date of termination of
employment.
In December 2004, the FASB issued SFAS No. 123
(Revised), Share-Based Payment.
SFAS No. 123-R
replaces SFAS No. 123 and supersedes APB Opinion
No. 25. Accordingly, the Company records a non-cash expense
for our stock compensation plans using the fair value method.
Historically we have recorded our compensation cost in
accordance with APB Opinion No. 25, which did not require
the recording of an expense for stock options if they were
granted at a price equal to the fair market value of our common
stock on the grant date. No changes to the design of the
long-term incentive program have been made as a result of
fair-value accounting under
SFAS No. 123-R.
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Company’s Directors, Executive
Officers, and beneficial owners of more than 10% of Common Stock
to file with the SEC reports regarding their ownership and
changes in ownership of the Company’s securities. The
Company believes that during fiscal 2006, its Directors,
Executive Officers, and greater-than-ten-percent shareholders
complied with all Section 16(a) filing requirements, with
the exception of two instances of late filings for the following
stock transactions in 2006: Mark H. Robinson purchased
“phantom” stock units in the Company’s deferred
compensation plan on December 14, 2006 and reported the
purchase on Form 4 on February 6, 2007; and Jeffrey C.
Ward received a grant of shares for his service on the Board on
March 2, 2006, and reported the grant on March 8, 2006.
In 2007 the Company adopted a formal policy regarding the
recovery of performance-based compensation during years in which
restated performance would have reduced the amount paid. It is
the policy of the Board of Directors that the Company will, to
the extent permitted by governing law, require reimbursement of
all or a portion thereof, as applicable, of any
performance-based compensation paid to any participant in the
Company’s long term incentive plans after January 30,
2007 where a) the payment was predicated upon the
achievement of certain financial results that were subsequently
the subject of a material restatement, and b) a lower
payment, or no payment, would have been made to the participant
based upon the restated financial results. In each such
instance, the Company will, to the extent practicable, seek to
recover the amount by which the individual participant’s
compensation exceeded the amount that would have been paid based
on the restated financial results, plus a reasonable rate of
interest.
The Committee has approved the Saia Stock Ownership Guidelines
(“Ownership Guidelines”), which apply to officers who
receive long-term incentives. The purpose of the guidelines is
to further align executives’ interests with
shareholders’ through stock ownership.
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The number of shares that an officer needs to acquire to satisfy
the Ownership Guidelines is determined by multiplying their
current base salary by the applicable multiple of base salary
and dividing by the share price. The current Ownership
Guidelines are set based on competitive levels and are as
follows:
The Committee reviews Ownership Guidelines at least annually and
monitors each covered executive’s progress toward, and
continued compliance with, the guidelines.
The table below describes the ownership guidelines for each
current Named Executive Officer and the number of shares owned
as of December 31, 2006.
The Named Executive Officers are not in compliance with the
above stock ownership guidelines due to recent changes in the
guidelines for changes in positions due to the recent sale of
Jevic and the consolidation and relocation of the holding
company and the recent decrease in the stock price.
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The following table sets forth the compensation awarded to,
earned by or paid to Saia’s chief executive officer and
chief financial officer (including all individuals who served in
those capacities during 2006) and its three other most highly
compensated executive officers (the “Named Executive
Officers” or “NEOs”) for services rendered in all
capacities within Saia during the fiscal year ended
December 31, 2006.
SUMMARY
COMPENSATION TABLE — 2006
(All values represented in 000s)
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Saia is a party to an employment agreement with Herbert A.
Trucksess, III. Mr. Trucksess’ employment with
the Company terminated on December 31, 2006.
Mr. Trucksess continues to serve as Chairman of the
Company’s Board of Directors. Upon his termination and
following the six-month waiting period required by
Section 409 of the Internal Revenue Code,
Mr. Trucksess will receive a lump sum cash payment equal to
three times his annual rate of base compensation and a pro rated
target bonus based on the actual portion of the fiscal year
elapsed prior to the termination of the executive’s
employment. Mr. Trucksess and his spouse will remain
covered under the employee benefit plans in which he
participated prior to termination of employment for
36 months. All outstanding stock options held by
Mr. Trucksess at the time of termination vested and remain
exercisable until the earlier of three years following his
termination or the expiration of the option term. In addition,
Mr. Trucksess is eligible to receive the supplemental
retirement benefits described in “Pension Benefits”
below.
Saia also has entered into employment agreements with Richard D.
O’Dell and Anthony D. Albanese. The terms and conditions of
these employment agreements are summarized below.
During the employment period, Messrs. O’Dell and
Albanese (i) receive a base salary (which shall be reviewed
annually but shall at no time during the term of the agreement
be decreased from the rate then in effect);
(ii) participate in a bonus program for which the criteria
and parameters for payment are determined annually by the
Compensation Committee of the Board of Directors; and
(iii) participate in employee benefit plans made available
by Saia to its executives from time to time.
Each employment agreement terminates immediately upon the
executive officer’s death. Saia may terminate the
executive’s employment agreement in the event of the
permanent and total disability of the executive or for cause.
Each of Messrs. O’Dell and Albanese may terminate his
employment at any time by providing 30 days’ notice to
the Company, in which case he will receive base salary to the
date of termination and all his outstanding stock options will
be forfeited.
Each of Mr. O’Dell and Mr. Albanese are entitled
to certain payments upon termination in some circumstances. See
“Potential Payments Upon Termination or Change in
Control.”
The following table sets forth the detail of other compensation
awarded to, earned by or paid to Saia’s Named Executive
Officers for services rendered in all capacities within Saia
during the fiscal year ended December 31, 2006.
All Other
Compensation — 2006
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The following table sets forth the detail of grants of
plan-based awards to Saia’s Named Executive Officers (NEOs)
for services rendered in all capacities within Saia during the
fiscal year ended December 31, 2006.
Grants of
Plan-Based Awards — 2006
All long-term incentives awarded in 2006 were awarded under the
Saia, Inc. Amended and Restated 2003 Omnibus Incentive Plan,
which was approved by the shareholders at the 2005 annual
meeting. The performance period for these awards is
2006-2008.
Each participant who received an award is assigned a target cash
incentive, which is a percentage of average annual base salary
during the three years of the performance period. The amount of
the target cash incentive that is paid to a participant with
respect to the three-year performance period is based on the
total shareholder return of Saia compared to the total
shareholder return of selected peer companies. If the total
shareholder return of Saia for the three-year period is
negative, no payouts are made under the award. Payouts are made
in cash at the end of the three-year performance period. Because
the amount of an executive’s payout is based on the
Company’s total shareholder return compared to that of
members of a peer group over a three-year period, the exact
amount of the payout (if any) cannot be determined at this time.
The target and maximum amounts in the table above were
calculated based on the participant’s base salary at
December 31, 2006 using each participant’s appropriate
payout percentage for the target payout estimate and two times
the target amount for the maximum payout estimate.
The stock option grants to the Named Executive Officers are
approved by the Compensation Committee on the same day as the
grants to other stock option recipients. Stock options granted
in 2006 have an exercise price equal to the market closing price
of Saia stock on the date of grant and a three-year cliff
vesting schedule and a seven-year term. The grant date fair
value of the stock options was determined using the
Black-Scholes-Merton formula with the following assumptions:
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Outstanding
Equity Awards at December 31, 2006
The following table sets forth information regarding the number
of shares of unexercised stock options and the number of shares
and value of unvested restricted stock outstanding on
December 31, 2006 for our Named Executive Officers.
All unexercisable options were issued under the Saia, Inc.
Amended and Restated 2003 Omnibus Incentive Plan.
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The following table sets forth information regarding the number
and value of stock options exercised and stock vested during
2006 for our Named Executive Officers.
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Saia maintains a non-qualified deferred compensation plan,
titled the SCST Executive Capital Accumulation Plan. The
Company’s officers are eligible to participate in the plan.
Annually, the Company contributes an amount equal to
5 percent of each participant’s base salary and annual
incentive plan payments to the plan. In addition, to the extent
a participant’s contribution to their respective 401(k)
plan is limited under restrictions placed on “Highly
Compensated Employees” under ERISA, the participant may
elect to contribute the limited amount to the Capital
Accumulation Plan. To the extent the Company was unable to match
participant contributions under the 401(k) plan because of the
ERISA limitations on the amount of contributions, the matching
contributions will be made by the Company to the Capital
Accumulation Plan.
The plan also allows the participant to make an elective
deferral each year of up to 50 percent of base salary or
100 percent of any annual incentive plan payment. The
participant must irrevocably elect the elective deferral during
the year preceding the year for which compensation is being
deferred. The plan is designed to provide the same investment
options to participants as are available under their respective
401(k) plans, except that participants may also elect to invest
in Saia stock under the plan. Participants may elect to transfer
balances between investment options, other than Saia stock,
without restriction at any time throughout the year.
Plan balances become distributable to the participant upon
termination of employment. In order to be eligible to receive
payment of the 5 percent annual Company contribution, the
participant must have been employed by Saia or an affiliated
company, including service with the Company’s former parent
(Yellow Corporation) prior to the spin-off of the Company from
Yellow Corporation, for a period of at least five years from the
date of contribution, unless termination is the result of
disability or death. If a participant is terminated for cause,
as defined under the applicable plan, all amounts plus
investment earnings attributable to the 5 percent annual
Company contribution are forfeited.
Mr. Trucksess receives a supplemental retirement benefit,
reduced by amounts received from the SCST Executive Capital
Accumulation Plan, that is intended to provide
Mr. Trucksess with approximately the difference between the
supplemental retirement benefits that he would have received
under his previous employment contract with his former employer
(Yellow Corporation), had Mr. Trucksess continued his
employment with Yellow Corporation, and the expected actual
retirement benefits Mr. Trucksess will be entitled to from
Yellow Corporation. Mr. Trucksess’ supplemental
retirement benefit will generally be computed using
16 years of credit service plus his actual combined service
at Saia and Yellow Corporation (approximately 13 years at
December 31, 2006).
Pursuant to his employment contract, at age 62,
Mr. Trucksess will receive an annual pension benefit
amounting to (a) one and three sevenths percent of his
final average annual compensation paid in the five highest
consecutive years of his last 10 consecutive years of combined
employment with Saia and Yellow Corporation, multiplied by his
total combined years of employment with Saia and Yellow
Corporation, reduced by (b) one and three sevenths percent
of his primary Social Security entitlement at retirement,
multiplied by his total combined years of employment with Saia
and Yellow Corporation, such amount further reduced by the
benefits under the Yellow Corporation qualified and nonqualified
pension plans and the Saia nonqualified plan attributable to
Saia’s contributions. His total combined years of
employment with Saia and Yellow Corporation is computed by
adding
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(a) his actual years and months of service with Saia and
Yellow Corporation from June 1, 1994 through the date of
his termination and (b) 16 years and
(c) one-third of the sum of (a) his actual years and
months of service with Saia and Yellow Corporation from
June 1, 1994 through the date of his termination and
(b) 16 years, minus (c) 17.95 years. The
present value of the accumulated benefit was actuarially
determined based on the following assumptions:
The tables below reflect the amount of compensation to each of
the Named Executive Officers of the Company with employment
agreements in the event of termination of such executive’s
employment. The amount of compensation payable to the officer
upon voluntary termination, involuntary
not-for-cause
termination, for cause termination, and in the event of
disability or death of the executive is shown below. The amounts
shown assume that such termination was effective as of
December 31, 2006, and thus amounts earned through such
time and are estimates of the amounts which would be paid out to
the respective executive upon their termination under the
provisions. The actual amounts to be paid out can only be
determined at the time of such executive’s actual
separation from the Company.
Payments Made upon Termination: Regardless of
the manner in which Mr. O’Dell or Mr. Albanese
terminate, they are entitled to receive amounts earned during
the term of employment. Such amounts include:
Payments Made upon Death or Disability: In the
event of the death or disability of Mr. O’Dell or
Mr. Albanese, in addition to the benefits listed under the
heading “Payments Made Upon Termination” above,
Messrs. O’Dell and Albanese will receive benefits
under the Company’s disability plan or payments under the
Company’s life insurance plan, as applicable.
Payments Made upon a Change of Control: The
Company has separate executive severance agreements with
Messrs. O’Dell and Albanese that address termination
payments as described in the “Potential Payments under
Change of Control Agreements” section below.
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The following table details the potential payments upon
termination of Mr. O’Dell, the Company’s Chief
Executive Officer and President:
The following table details the potential payments upon
termination of Mr. Albanese, the Company’s Senior Vice
President of Sales & Operations:
In the event of termination without cause in situations like a
reduction in workforce that would not be covered by an Executive
Severance Agreement or employment agreement, or for those
individuals who do not have such agreements, the Company has in
the past provided a minimum of 12 weeks of severance
compensation for officers. This practice has provided
competitive severance levels to officers who are not covered by
other formal severance arrangements in the event of termination
that typically is unrelated to an individual’s job
performance. The severance payment supports the former employee
for a limited period of time for the transition from employment
at
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Saia to their next employer. This is not a formal policy of the
Company, but an informal practice that the Company has the right
to modify or eliminate at anytime.
Certain
Terminated Named Executive Officers
As of December 31, 2006, Mr. Trucksess’
employment with Saia terminated as a result of the sale of Jevic
and the relocation and consolidation of the holding company. He
remains Chairman of the Board of Directors of Saia, Inc. In
accordance with the employment agreement entered into between
the Company and Mr. Trucksess (filed as exhibit 10.5
of the Company’s annual report on
Form 10-K
for the year ended December 31, 2002 and the modification
of the employment agreement dated December 7, 2006 filed as
exhibit 10.1 of the Company’s
Form 8-K
filed on December 13, 2006), Mr. Trucksess will
receive a lump sum payment of $1,960,693, representing the
payout of three times his annual base salary, his annual
incentive for 2006, the 2006 Company contribution to the
nonqualified deferred compensation plan, continuation of his car
allowance and reimbursement of country club dues and tax and
estate planning allowance for three years. The Company expects
to pay this amount on July 2, 2007. Mr. Trucksess will
also receive his payout for his performance unit award of
$542,649 at that time. The Company will pay Mr. Trucksess
interest on these payments to be made in July 2007 at the
6 month Treasury bill rate. In addition, Mr. Trucksess
will also be reimbursed for continuation of heath care coverage
for three years at an estimated cost of $34,353, and the Company
will continue for three years to maintain a $1.0 million
term life insurance policy for Mr. Trucksess.
Mr. Trucksess is also entitled to the benefits under his
supplemental retirement plan as described in the “Pension
Benefits” table above.
Additionally, Mr. Bellinghausen received termination
benefits in connection with his termination as a result of the
sale of Jevic and the relocation and consolidation of the
holding company effective December 31, 2006.
Mr. Bellinghausen will receive a lump sum payment of
$444,559, representing the payout of eighteen months of his base
salary, his annual incentive for 2006, and the 2006 Company
contribution to the nonqualified deferred compensation plan. The
Company expects to pay this amount on July 2, 2007,
Mr. Bellinghausen will also receive his payout for his
performance unit award of $83,766 at that time. The Company will
pay Mr. Bellinghausen interest on these payments to be made
in July 2007 at the 6 month Treasury bill rate.
Both Mr. Trucksess and Mr. Bellinghausen will be
eligible to receive pro rata payouts under the
2005-2007
performance unit awards, if any, anticipated to be made in
February 2008.
Under the Executive Severance Agreements with the executive
officers, they will receive certain compensation in the event of
a “change of control” of Saia followed within two
years by (i) the termination of the executive’s
employment for any reason other than death, disability,
retirement or “cause” or (ii) the resignation of
the executive due to an adverse change in title, authority or
duties, a transfer to a new location, a reduction in salary, or
a reduction in fringe benefits or annual bonus below a level
consistent with Saia’s practice prior to a change of
control. In the event of a qualifying change of control event
the executive officer will receive: (i) a lump sum cash
payment equal to two times the highest average annual rate of
base compensation and annual cash incentive bonuses paid or
payable in any consecutive 12 month period during the three
years prior to termination, except in the case of
Mr. O’Dell whose lump sum cash payment is three times
the highest average annual rate of base compensation and annual
cash incentive bonuses paid or payable in any consecutive
12 month period during the three years prior to
termination; (ii) a pro rated payout of benefits for the
performance unit award based on the actual portion of the
performance period elapsed prior to the termination of the
executive’s employment; (iii) beginning on the date of
the executive’s termination of employment, the executive
(and spouse if applicable) shall remain covered under the
employee benefit plans in which he participated prior to
termination of employment for 24 months (36 months in
the case of Mr. O’Dell); and (iv) all outstanding
stock options held by the executive officer at the time of
termination shall vest and remain exercisable for one year (two
years in the case of Mr. O’Dell).
Saia agrees to pay the officer a gross up payment to make the
officer whole for any taxes incurred by the officer for any
payment, distribution or other benefit (including any
acceleration of vesting of any benefit) received or deemed
received by the officer under the Executive Severance Agreement
or otherwise that triggers the excise tax imposed by
Section 4999 of the Internal Revenue Code.
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For the purpose of the Agreements, a “Change of
Control” will be deemed to have taken place if: (i) a
third person, including a “group” as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934,
purchases or otherwise acquires shares of Saia and as a result
thereof becomes the beneficial owner of shares of Saia having
20% or more of the total number of votes that may be cast for
the election of directors of Saia; or (ii) as the result
of, or in connection with any cash tender or exchange offer,
merger or other business combination, or contested election, or
any combination of the foregoing transactions, the directors
then serving on the Board of Directors cease to constitute a
majority of the Board of Directors of Saia or any successor to
Saia.
The following table details the amounts that each executive
officer would have received under the change of control
agreements if their employment had terminated on
December 31, 2006, the last business day of the
Company’s fiscal 2006, and based on the Company’s
closing stock price as of December 29, 2006 of $23.21:
Mr. O’Dell is the only Named Executive Officer whose change
of control termination payments would trigger the
Section 4999 gross up payment if such payments had been
made as of December 31, 2006; the Section 4999 gross
up payment at December 31, 2006 is estimated to be less
than $25,000.
Director
Compensation 2006
With the exception of the non-employee Chairman, non-employee
(outside) directors receive:
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The non-employee Chairman receives an annual retainer of
$170,000, but does not receive fees for attending Board or
Committee meetings. Non-employee directors are reimbursed for
travel and other
out-of-pocket
incidental expenses related to meetings and for spousal travel
to certain meetings. Pursuant to the Saia, Inc. Amended and
Restated 2003 Omnibus Incentive Plan, at least 50 percent
of the annual retainer for each non-employee director (other
than the non-employee Chairman of the Board) and at least
50 percent of the annual fee paid to each Committee
chairperson and Lead Independent Director is paid in Saia common
stock, rather than cash, with the value of such stock based on
the fair market value of Saia common stock at the date of the
award. In addition, pursuant to the Saia, Inc. Amended and
Restated 2003 Omnibus Incentive Plan, non-employee directors
receive an annual award of shares of the Company’s common
stock not to exceed 3,000 shares, with the actual number of
shares determined annually by the Compensation Committee with
the award made on the third business day following the annual
meeting of shareholders. In 2006, each non-employee director
received an award of 1,010 shares, except for
Mr. Ward, who received an award of 215 shares upon
joining the Board in March 2006. The Compensation Committee has
determined that each non-employee director will receive an award
of 1,030 shares in 2007.
Under the Directors’ Deferred Fee Plan, non-employee
directors may defer all or a portion of annual fees earned,
which deferrals are converted into units equivalent to the value
of Company common stock. Upon the directors’ termination,
death or disability, accumulated deferrals are distributed in
the form of Company common stock.
The Compensation Committee of the Board of Directors of the
Company has submitted the following report for inclusion in this
Proxy Statement:
Our Committee has reviewed and discussed the Compensation
Discussion and Analysis contained in this Proxy Statement with
management. Based on our Committee’s review of and the
discussions with management with respect to the Compensation
Discussion and Analysis, our Committee recommended to the board
of directors that the Compensation Discussion and Analysis be
included in this Proxy Statement and in the Company’s
Annual Report on
Form 10-K
for the fiscal year ended December 31, 2006 for filing with
the SEC.
The foregoing report is provided by the following directors, who
constitute the Committee:
Compensation
Committee
Linda J. French, Chairperson Bjorn A. Olsson Douglas W. Rockel
The Compensation Committee is currently comprised of Linda J.
French, Bjorn Olsson and Douglas W. Rockel. None of these
individuals is or has ever been an officer or employee of Saia.
During fiscal 2006, no executive officer of Saia served as a
director of any corporation for which any of these individuals
served as an executive officer, and there were no other
Compensation Committee interlocks with the companies with which
these individuals or Saia’s other directors are affiliated.
The Audit Committee operates pursuant to a written charter,
which has been approved and adopted by the Board of Directors
and is reviewed and reassessed annually by the Audit Committee.
The Committee charter is included within this proxy as
Exhibit A and is available within the corporate governance
section of the Company’s
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website at www.saia.com. For the year ended December 31,
2006 and as of the date of the adoption of this report, the
Audit Committee was comprised of four directors who met the
independence and experience requirements of The Nasdaq Stock
Market. Messrs. Olson, Holland and Olsson are “audit
committee financial experts” as defined by the applicable
rules of the Securities and Exchange Commission.
The Audit Committee oversees Saia’s financial reporting
process on behalf of the Board of Directors and oversees the
entire audit function, including the selection of independent
auditors. Management has the primary responsibility for the
financial statements and the financial reporting process,
including the systems of internal controls and the
Company’s legal and regulatory compliance. In fulfilling
its oversight responsibilities, the Audit Committee reviewed and
discussed with management the audited financial statements for
the year ended December 31, 2006, including a discussion of
the acceptability and quality of the accounting principles, the
reasonableness of significant accounting judgments and critical
accounting policies and estimates, the clarity of disclosures in
the financial statements, and management’s assessment and
report on internal control over financial reporting. The Audit
Committee also discussed with the Chief Executive Officer and
Chief Financial Officer their respective certifications with
respect to Saia’s Annual Report on
Form 10-K
for the year ended December 31, 2006.
The Audit Committee reviewed with the independent auditors, who
are responsible for expressing opinions on (i) the
conformity of those audited financial statements with generally
accepted accounting principles, (ii) management’s
assessment of internal controls over financial reporting, and
(iii) the effectiveness of internal controls over financial
reporting, their judgments as to the acceptability and quality
of Saia’s accounting principles and such other matters as
are required to be discussed with the Audit Committee under
generally accepted auditing standards, including those matters
required to be discussed by Statement on Auditing Standards
No. 61, Communication with Audit Committees. In addition,
the Audit Committee has received the written disclosures and the
letter from the independent auditors required by Independence
Standards Board Standard No. 1, Independence Discussions
with Audit Committees, and has discussed those disclosures and
other matters relating to independence with the auditors.
The Audit Committee discussed with Saia’s internal and
independent auditors the overall scope and plans for their
respective audits. The Audit Committee meets with the internal
auditor and independent auditors, with and without management
present, to discuss the results of their examinations of
Saia’s internal controls, including controls over the
financial reporting process, and the overall quality of
Saia’s financial reporting.
Members of the Audit Committee rely without independent
verification on the information provided to them and on the
representations made by management and the independent auditors.
In reliance on the reviews and discussions with management and
with the independent auditors referred to above, and the receipt
of an unqualified opinion from KPMG LLP dated February 23,
2007 regarding the audited financial statements of Saia for the
year ended December 31, 2006, as well as the opinions of
KPMG LLP on management’s assessment of internal controls
over financial reporting and on the effectiveness of internal
controls over financial reporting, the Audit Committee
recommended to the Board of Directors (and the Board approved)
that the audited financial statements be included in the Annual
Report on
Form 10-K
for the year ended December 31, 2006 for filing with the
Securities and Exchange Commission.
Audit Committee Members
James A. Olson, Chairman John J. Holland Bjorn E. Olsson Jeffrey C. Ward
The foregoing Report of the Compensation Committee of the
Board of Directors and Report of the Audit Committee of the
Board of Directors shall not be deemed to be soliciting material
or be incorporated by reference by any general statement
incorporating by reference this proxy statement into any filing
under the Securities Act of 1933 or under the Securities
Exchange Act of 1934, except to the extent Saia specifically
incorporates this information by reference, and shall not
otherwise be deemed to be filed with the Securities and Exchange
Commission under such Acts.
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PROPOSAL 2
RATIFICATION
OF APPOINTMENT OF INDEPENDENT AUDITORS
KPMG LLP audited Saia’s annual financial statements for the
fiscal year ended December 31, 2006. The Audit Committee
has appointed KPMG LLP to be Saia’s independent auditors
for the fiscal year ending December 31, 2007. The
shareholders are asked to ratify this appointment at the annual
meeting. A representative of KPMG LLP will be present at the
meeting to respond to appropriate questions and to make a
statement if they so desire.
KPMG LLP billed Saia the following amounts for services provided
during fiscal 2005 and 2006:
The Audit Committee has a written policy governing the
engagement of Saia’s independent auditors for audit and
non-audit services. Under this policy, the Audit Committee is
required to pre-approve all audit and non-audit services
performed by the Company’s independent auditor to assure
that the provision of such services does not impair the
auditor’s independence. Under the Audit Committee policy,
the independent auditor may not perform any non-audit service
which independent auditors are prohibited from performing under
the rules and regulations of the Securities and Exchange
Commission or the Public Company Accounting Oversight Board. The
Audit Committee may delegate its pre-approval authority to one
or more of its members, but not to management. The member or
members to whom such authority is delegated shall report any
pre-approval decisions to the Audit Committee at its next
scheduled meeting.
At the beginning of each fiscal year, the Audit Committee
reviews with management and the independent auditor the types of
services that are likely to be required throughout the year.
Those services are comprised of four categories: audit services,
audit-related services, tax services and all other permissible
services. The independent auditor provides for each proposed
service documentation regarding the specific services to be
provided. At that time, the Audit Committee pre-approves a list
of specific audit related services that may be provided within
each of these categories, and sets fee limits for each specific
service or project. Management is then authorized to engage the
independent auditor to perform the pre-approved services as
needed throughout the year, subject to providing the Audit
Committee with regular updates. The Audit Committee reviews all
billings submitted by the independent auditor on a regular basis
to ensure that their services do not exceed pre-defined limits.
The Audit Committee must review and approve in advance, on a
case-by-case
basis, all other projects, services and fees to be performed by
or
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paid to the independent auditor. The Audit Committee also must
approve in advance any fees for pre-approved services that
exceed the pre-established limits, as described above.
The Audit Committee was responsible for selecting Saia’s
independent auditors for fiscal year 2007. Accordingly,
shareholder approval is not required to appoint KPMG LLP as
Saia’s independent auditors for fiscal year 2007. The Board
of Directors believes, however, that submitting the appointment
of KPMG LLP to the shareholders for ratification is a matter of
good corporate governance. The Audit Committee is solely
responsible for selecting Saia’s independent auditors. If
the shareholders do not ratify the appointment, the Audit
Committee will review its future selection of independent
auditors.
The ratification of the appointment of KPMG LLP as Saia’s
independent auditors requires the affirmative vote of a majority
of the shares present at the meeting in person or by proxy and
entitled to vote.
YOUR
BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE
“FOR” THE RATIFICATION OF KPMG LLP AS INDEPENDENT AUDITORS FOR 2007.
The following table lists certain persons known by Saia to own
beneficially, as of December 31, 2006, more than five
percent of Saia’s common stock.
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PROPOSAL
3
APPROVAL OF AMENDMENTS TO THE SAIA, INC. AMENDED AND RESTATED 2003 OMNIBUS INCENTIVE PLAN
In 2005, the Board of Directors and the Company’s
shareholders approved the SCS Transportation, Inc. Amended and
Restated 2003 Omnibus Incentive Plan, which has since been
renamed the Saia, Inc. Amended and Restated 2003 Omnibus
Incentive Plan following the Company’s name change in July
2006 (the “2003 Omnibus Incentive Plan”). The Board of
Directors has approved and recommends that the shareholders vote
for the approval of certain amendments to the 2003 Omnibus
Incentive Plan. The Board believes the proposed amendments will
enhance Saia’s ability to attract and retain outstanding
employees and non-employee directors. If shareholders do not
approve the proposed amendments, the plan as in effect prior to
the annual meeting will continue. The 2003 Omnibus Incentive
Plan as amended by the proposed amendments is designed to ensure
that amounts paid and equity awards made under the plan qualify
as performance-based compensation that is deductible under
Internal Revenue Code Section 162(m).
The Board’s approval and recommendation of amendments to
the 2003 Omnibus Incentive Plan follows a review and evaluation
of Saia’s existing compensation plans and a comparison of
those plans with the programs offered by comparable companies.
If approved by shareholders, the amendments to the 2003 Omnibus
Incentive Plan would:
A description of the 2003 Omnibus Incentive Plan, as amended,
subject to shareholder approval, follows and is qualified by
reference to the full text of the plan as currently in place
prior to the adoption of the proposed amendments, which is
included in this Proxy Statement as Exhibit B, and the full
text of the amendments, which is included as Exhibit C.
SUMMARY
OF THE 2003 OMNIBUS INCENTIVE PLAN, AS AMENDED AND RESTATED,
SUBJECT TO SHAREHOLDER APPROVAL
If approved by the shareholders, the amendments to the 2003
Omnibus Incentive Plan will be effective as of April 19,
2007. The 2003 Omnibus Incentive Plan will terminate on
January 22, 2013, unless terminated earlier by the Board of
Directors. Termination of the 2003 Omnibus Incentive Plan will
not affect grants made prior to termination, but grants may not
be made after termination.
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The purpose of the 2003 Omnibus Incentive Plan is to align the
personal financial interests of executive, managerial and
supervisory employees and non-employee directors with
Saia’s shareholders. The 2003 Omnibus Incentive Plan
includes provisions for stock grants, stock options, stock
appreciation rights (“SARs”), restricted stock and
performance unit awards.
The 2003 Omnibus Incentive Plan is administered by the
Board’s Compensation Committee. Subject to the terms of the
2003 Omnibus Incentive Plan, the Compensation Committee has
authority to (i) determine when and to whom awards will be
granted; (ii) determine the term of each award;
(iii) determine the number of shares covered by awards;
(iv) determine all other terms and conditions of awards;
(v) adopt and amend rules and regulations with respect to
the administration of the 2003 Omnibus Incentive Plan;
(vi) make such other determinations as the Committee deems
necessary or appropriate; and (vii) construe and interpret
the plan and resolve all questions arising under the plan.
Eligibility under the 2003 Omnibus Incentive Plan is limited to
Saia’s non-employee directors and employees of Saia and its
subsidiaries who have executive, managerial, supervisory or
professional responsibilities. Saia currently estimates that
participation in the 2003 Omnibus Incentive Plan will be limited
to its non-employee directors and to a group of 10 to 75
employees.
The maximum number of shares of common stock that may be issued
under the 2003 Omnibus Incentive Plan is 824,000 shares. No
more than 200,000 of the 824,000 shares available under the
2003 Omnibus Incentive Plan may be used for grants of restricted
stock or awards of shares under the plan in the aggregate. No
more than 100,000 of the 824,000 shares under the 2003
Omnibus Incentive Plan may be used for grants of restricted
stock or awards of shares to any one employee or
non-employee
director in the aggregate. In addition, no more than 200,000 of
the 824,000 shares under the 2003 Omnibus Incentive Plan
may be used for grants of stock options and SARs to any one
employee.
In the event of a stock split, reorganization, recapitalization,
stock dividend or other event described under the terms of the
2003 Omnibus Incentive Plan, the Compensation Committee will
make appropriate adjustments to the number of shares subject to
grants or awards previously made to participants, in the
exercise price per share of stock options previously granted to
participants and in the number and kinds of shares which may be
distributed under the 2003 Omnibus Incentive Plan. Appropriate
adjustments will also be made by the Compensation Committee in
the terms of SARs to reflect any change with respect to the
number of issued and outstanding shares of common stock.
As of March 8, 2007, the last reported sale price of Saia’s
common stock on The Nasdaq Stock Market was $26.05 per share.
Grant of Shares. At the later of (i) the
Board of Directors meeting held in conjunction with Saia’s
annual meeting of shareholders and (ii) the third business
day following the announcement of the Company’s earnings
results for the quarter ended prior to the Company’s annual
meeting of shareholders, each non-employee director will be
granted an award of shares of common stock equal in value to
50 percent of the then applicable level of annual Board and
Committee retainers, with the value of the shares to be computed
by reference to the fair market value of Saia’s common
stock on the date of the award. Each non-employee director also
has the option of receiving up to 100 percent of the
applicable level of annual Board and Committee retainers in
shares of common stock rather than cash. Should any non-employee
director desire to take advantage of this option, such
non-employee director is required to notify the Compensation
Committee at least seven days prior to each annual meeting of
shareholders.
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At the later of (i) the Board of Directors meeting held in
conjunction with Saia’s annual meeting of shareholders and
(ii) the third business day following the announcement of
the Company’s earnings results for the quarter ended prior
to the Company’s annual meeting of shareholders, each
non-employee director is granted an annual award of no more than
3,000 shares of Saia common stock, with the exact number to
be set by the Compensation Committee. The Compensation Committee
has determined that 1,030 shares would be awarded to each
non-employee director for 2007.
The 2003 Omnibus Incentive Plan authorizes grants of stock
options to eligible employees from time to time as determined by
the Compensation Committee. Subject to the limits of the 2003
Omnibus Incentive Plan, the Compensation Committee may grant
options to eligible employees under the 2003 Omnibus Incentive
Plan for such number of shares and having such terms as the
Compensation Committee designates; however, the maximum number
of options (and SARs described below) that may be granted to any
one employee may not exceed in the aggregate 200,000 shares
over the life of the 2003 Omnibus Incentive Plan.
The Compensation Committee shall specify whether or not any
option is intended to be an incentive stock option
(“incentive stock option”) as described in
Section 422 of the Internal Revenue Code or a nonstatutory
or nonqualified stock option (“nonqualified stock
option”). The aggregate value of common stock with respect
to which incentive stock options are exercisable for the first
time by an individual during any calendar year under all Saia
plans may not exceed $100,000. Stock options may not be
exercised more than ten years from the date of grant (five years
in the case of incentive stock options granted to a 10% or more
shareholder). The Compensation Committee may provide for options
to be exercisable in installments during the term of the option
and the Compensation Committee may also accelerate the time at
which an installment portion of an outstanding option may be
exercisable.
Each stock option shall have an exercise price that is not less
than the fair market value of the common stock on the date the
option is granted (110% of the fair market value in the case of
incentive stock options granted to a 10% or more shareholder).
The 2003 Omnibus Incentive Plan prohibits the repricing of stock
options.
Payment for shares received upon exercise of a stock option may
be made by an optionee in cash, shares of common stock, a
combination of the foregoing, or, if permitted by the Company,
through a cashless exercise (to the extent allowed by law).
The Compensation Committee has the discretion to determine the
effect on outstanding stock options in the event an employee
ceases employment due to total disability, death or retirement.
The 2003 Omnibus Incentive Plan also authorizes the Compensation
Committee to affix SARs to stock options either at the time the
option is granted or at any later date at least six months prior
to the option’s expiration. SARs provide an optionee the
right to surrender all or a portion of an option and receive
from Saia a payment, in shares of common stock, cash, or a
combination thereof, equal to the excess of the fair market
value of the shares of common stock for which the SAR is
exercised over the aggregate option exercise price of such
shares under the related option at the time of surrender. SARs
are exercisable only to the extent that the related options are
exercisable. The exercise of any option will result in an
immediate forfeiture of its related SAR, and the exercise of an
SAR will cause an immediate forfeiture of its related option.
The 2003 Omnibus Incentive Plan permits the Compensation
Committee to grant restricted stock awards to employees. The
Compensation Committee will determine the nature and extent of
the restrictions on grants of restricted stock, the duration of
such restrictions, and any circumstances under which restricted
shares will be forfeited. Subject to the terms of the 2003
Omnibus Incentive Plan, the restrictions may not lapse earlier
than the first or later than the tenth anniversary of the date
of the award. The maximum number of shares of restricted stock
and unrestricted stock that may be awarded to any one individual
is 100,000 and the maximum number in the
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aggregate that may be awarded under the 2003 Omnibus Incentive
Plan is 200,000 shares over the life of the 2003 Omnibus
Incentive Plan. Except as otherwise provided by the Compensation
Committee, during any such period of restriction, recipients
shall have all of the rights of a holder of common stock,
including but not limited to voting rights and the right to
receive dividends. The Compensation Committee may establish
rules concerning the impact of the termination of employment (by
reason of retirement, total disability, death or otherwise) on
the applicability of any outstanding restrictions.
The 2003 Omnibus Incentive Plan permits the Compensation
Committee to grant performance unit awards to eligible employees
under the 2003 Omnibus Incentive Plan from time to time. Payment
of earned performance unit awards are made to participants in
cash with respect to performance units granted prior to 2007.
The Board amended the 2003 Omnibus Incentive Plan in January
2007 to provide that performance unit awards granted on and
after January 2007 be paid in stock.
Under the terms of the 2003 Omnibus Incentive Plan, the
Compensation Committee establishes the time periods over which
performance will be measured (the “Performance
Period”) and the criteria to be used by the Compensation
Committee to evaluate Saia’s performance with respect to
each Performance Period. Such criteria shall be either financial
or operating measures of Saia or its subsidiaries or both and
shall be one or more of the following: pretax income, net
income, earnings per share, revenue, expenses, return on assets,
return on equity, return on investment, return on capital, net
profit margin, operating profit margin, cash flow, total
shareholder return, capitalization, liquidity, results of
customer satisfaction surveys, quality, safety, productivity,
cost management or process improvement or any combination of the
foregoing established by the Compensation Committee, or they may
be based on Saia’s performance compared with one or more
selected companies.
Under the 2003 Omnibus Incentive Plan, the value of the awards
covered by all performance unit awards granted to all
“covered employees” (as defined in Section 162(m)
of the Internal Revenue Code) with respect to a Performance
Period will not exceed two percent of Saia’s consolidated
operating income, plus depreciation and amortization
(“EBITDA”) for the three fiscal years immediately
preceding the grant, as determined by the Compensation
Committee, and the value of the awards covered by all
performance unit awards granted to an individual “covered
employee” (as defined in Section 162(m) of the
Internal Revenue Code) under the 2003 Omnibus Incentive Plan
with respect to a Performance Period will not exceed one percent
of the EBITDA for the three fiscal years immediately preceding
the grant, as determined by the Compensation Committee.
The Board may at any time terminate, suspend or amend the 2003
Omnibus Incentive Plan in any respect, except that the Board may
not, without further approval of the shareholders, amend the
2003 Omnibus Incentive Plan so as to (i) increase the
number of shares of common stock which may be issued under the
2003 Omnibus Incentive Plan (except for adjustments for changes
in capitalization); (ii) change terms of the 2003 Omnibus
Incentive Plan relating to the establishment of the exercise
prices under options granted; (iii) extend the duration of
the 2003 Omnibus Incentive Plan beyond January 22, 2013;
(iv) lengthen the maximum period during which an option or
SAR may be exercised; (v) increase the maximum amount a
grantee may be paid upon the exercise of a SAR; or
(vi) change the class of employees eligible to received
awards. No termination, suspension or amendment of the 2003
Omnibus Incentive Plan may, without the consent of an affected
participant, adversely affect any of the rights granted such
participant under the 2003 Omnibus Incentive Plan.
The 2003 Omnibus Incentive Plan provides that in the event Saia
is to be wholly or partly liquidated, or agrees to participate
in a merger, consolidation or reorganization in which it, or any
entity controlled by it, is not the surviving entity, the
Committee may provide that any and all options and SARs granted
under the Plan shall be immediately exercisable, that any
restricted stock awards under the Plan may be immediately
payable in full and any performance unit award will terminate
upon the payment of the amounts payable under the award
agreement. The Compensation Committee is also granted the right
to provide that grantees be paid consideration received by
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shareholders in such transaction, minus the option price of
grantee’s options and the fair market value of shares
covered by SARs on the date of grant of the SAR in full
satisfaction of such options and SARs.
The federal income tax consequences applicable to Saia in
connection with an incentive stock option, nonqualified stock
option, SAR, award of stock or restricted stock or performance
unit award are complex and depend, in large part, on the
surrounding facts and circumstances. Under current federal
income tax laws, a participant will generally recognize income
with respect to grants of stock options, SARs, awards of stock
or restricted stock, or performance unit awards, as follows:
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With the exception of the issuance of shares to non-employee
directors, all benefits payable that may be awarded under the
2003 Omnibus Incentive Plan are at the discretion of the
Compensation Committee. Except as set forth in the table below,
the amount of benefits payable under the 2003 Omnibus Incentive
Plan is not determinable:
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YOUR
BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE
“FOR” THE APPROVAL OF THE AMENDMENTS TO THE 2003 OMNIBUS INCENTIVE PLAN.
The Audit Committee of the Board of Directors is responsible for
the review and approval of each related party transaction. In
January 2007 the Board of Directors formalized in writing its
Related Party Transaction Policies and Procedures.
The Related Party Transaction Policies and Procedures provide
for approval or ratification by the Audit Committee of each
related person transaction disclosable under SEC rules. The
Policies and Procedures provide for the Audit Committee to
review the material facts of all related party transactions that
require the Audit Committee’s approval, subject to certain
exceptions. If advance Audit Committee approval is not
practicable, then the related party transaction shall be
considered and, if the Audit Committee deems appropriate,
ratified at its next regularly scheduled meeting.
In determining whether to approve or ratify a related party
transaction, the Committee will take into account, among other
factors it deems appropriate, whether the related party
transaction is on terms no less favorable to the Company than
terms generally available to an unaffiliated third-party under
the same or similar circumstances, and the extent of the related
party’s interest in the transaction. The Audit Committee
has established standing pre-approvals for certain classes of
related party transactions. In addition, the Board of Directors
has given the Chair of the Audit Committee the authority to
pre-approve any related party transaction in which the aggregate
amount involved is less than $500,000. Each related party
transaction approved pursuant to the standing pre-approvals or
pursuant to the authority granted the Chair of the Audit
Committee is described to the Audit Committee at its next
regularly scheduled meeting.
The Company has entered into indemnification agreements with the
members of its Board of Directors. Under these agreements, the
Company is obligated to indemnify its directors to the fullest
extent permitted under the Delaware General Corporation Law for
expenses, including attorneys’ fees, judgments, and
settlement amounts incurred by them in any action or proceeding
arising out of their services as a director. The Company
believes that these agreements are helpful in attracting and
retaining qualified directors. The Company’s Amended and
Restated Certificate of Incorporation also provides for
indemnification of its officers and Directors to the fullest
extent permitted by the Delaware General Corporation Law.
We know of no other business that will be presented at the
meeting. If any other matter properly comes before the
shareholders for a vote at the meeting, however, the proxy
holders will vote your shares in accordance with their best
judgment.
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ADDITIONAL
INFORMATION
Saia will bear the entire cost of this proxy solicitation. In
addition to soliciting proxies by this mailing, we expect that
our directors, officers and regularly engaged employees may
solicit proxies personally or by mail, telephone, facsimile or
other electronic means, for which solicitation they will not
receive any additional compensation. Saia will reimburse
brokerage firms, custodians, fiduciaries and other nominees for
their
out-of-pocket
expenses in forwarding solicitation materials to beneficial
owners upon our request.
Any shareholder who intends to present a proposal at the annual
meeting in 2008 must deliver the proposal to Saia’s
corporate Secretary at 11465 Johns Creek Parkway,
Suite 400, Duluth, Georgia 30097:
By order of the Board of Directors,
James A. Darby
Secretary
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Exhibit A
SAIA,
INC.
AUDIT
COMMITTEE CHARTER
The Audit Committee is appointed by the Board to oversee the
accounting and financial reporting processes of the Company and
the audits of the Company’s financial statements. In that
regard, the Audit Committee assists the Board in monitoring
(1) the integrity of the financial statements of the
Company, (2) the independent auditor’s qualifications
and independence, (3) the performance of the Company’s
internal audit function and independent auditors, and
(4) the compliance by the Company with legal and regulatory
requirements.
The Audit Committee shall prepare the report required by the
rules of the Securities and Exchange Commission (the
“Commission” or “SEC”) to be included in the
Company’s annual proxy statement.
The Audit Committee shall consist of at least three and no more
than five independent directors that shall be appointed annually
by the Board of Directors on the recommendation of the
Nominating and Governance Committee. The Board of Directors
shall appoint one of the members of the Audit Committee as
chairperson. Independent directors are (consistent with Nasdaq
independence requirements) persons other than an officer or
employee of the Company, who have no relationship to the Company
that may interfere with the exercise of their independent
judgment in carrying out the responsibilities of a director.
Audit Committee members shall have (1) the ability to read
and understand fundamental financial statements, including a
company’s balance sheet, income statement, statement of
cash flow, and key performance indicators; and (2) the
ability to understand key business and financial risks and
related controls and control processes. Audit Committee members
may enhance their familiarity with finance and accounting by
participating in educational programs conducted by the Company
or an outside consultant. The Board of Directors will determine
whether at least one member of the Audit Committee qualifies as
an “audit committee financial expert” in compliance
with the criteria established by the SEC. The existence of such
a member, including his or her name and whether or not he or she
is independent, will be disclosed as required by the SEC. Audit
Committee members shall not simultaneously serve on the audit
committees of more than two other public companies.
The Audit Committee shall meet as often as it determines
necessary but not less frequently than quarterly. The Audit
Committee shall meet periodically in separate executive sessions
with management, the internal auditors and the independent
auditor, and have such other direct and independent interaction
with such persons from time to time as the members of the Audit
Committee deem appropriate. The Audit Committee may request any
officer or employee of the Company or the Company’s outside
counsel or independent auditor to attend a meeting of the
Committee or to meet with any members of, or consultants to, the
Committee.
The Audit Committee shall have the sole authority to appoint,
determine funding for, and oversee the outside auditors
(subject, if applicable, to stockholder ratification). The Audit
Committee shall be directly responsible for the compensation and
oversight of the work of the independent auditor (including
resolution of disagreements between management and the
independent auditor regarding financial reporting) for the
purpose of preparing or issuing an audit report or related work.
The independent auditor shall report directly to the Audit
Committee.
The Audit Committee shall pre-approve all auditing services,
internal control-related services and permitted non-audit
services (including the fees and terms thereof) to be performed
for the Company by its independent auditor, subject to the de
minimis exception for non-audit services that are approved by
the Audit Committee prior to the completion of the audit. The
Audit Committee may form and delegate authority to subcommittees
consisting
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of one or more members when appropriate, including the authority
to grant pre-approvals of audit and permitted non-audit
services, provided that decisions of such subcommittee to grant
pre-approvals shall be presented to the full Audit Committee at
its next scheduled meeting.
The Audit Committee shall have the authority, to the extent it
deems necessary or appropriate, to engage and determine funding
for independent legal, accounting or other advisors. The Company
shall provide for appropriate funding, as determined by the
Audit Committee, for payment of compensation to the independent
auditor for the purpose of rendering or issuing an audit report
or performing other audit, review or attest services for the
Company and to any advisors employed by the Audit Committee, as
well as funding for the payment of ordinary administrative
expenses of the Audit Committee that are necessary or
appropriate in carrying out its duties.
The Audit Committee shall make regular reports to the Board. The
Audit Committee shall review and reassess the adequacy of this
Charter annually and recommend any proposed changes to the Board
for approval.
The Audit Committee, to the extent it deems necessary or
appropriate, shall:
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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 and disclosures are complete
and accurate and are in accordance with generally accepted
accounting principles and applicable rules and regulations.
These are the responsibilities of management and the independent
auditor.
Adopted January 30, 2007
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Exhibit B
SAIA,
INC.
AMENDED AND RESTATED 2003 OMNIBUS INCENTIVE PLAN
The Saia, Inc. 2003 Omnibus Incentive Plan is designed to enable
qualified executive, managerial, supervisory and professional
personnel of Saia, Inc. and its Subsidiaries and non-employee
directors of Saia, Inc. and its Subsidiaries to acquire or
increase their ownership of common stock of the Company on
reasonable terms, and in some cases, to enable such personnel to
receive cash awards. The opportunity so provided is intended to
foster in such individuals a strong incentive to put forth
maximum effort for the continued success and growth of the
Company and its Subsidiaries, to aid in retaining individuals
who put forth such efforts, and to assist in attracting the best
available individuals in the future.
When used herein, the following terms shall have the meaning set
forth below:
2.1 “Award” shall mean an Option, an
SAR, a Performance Unit Award, a Restricted Stock Award, or a
grant of Shares.
2.2 “Board” means the Board of
Directors of Saia, Inc.
2.3 “Cause” means gross negligence
or gross neglect of duties, commission of a felony or of a gross
misdemeanor involving moral turpitude; or fraud, disloyalty,
dishonesty or willful violation of any law or significant
Company or Subsidiary policy resulting in an adverse effect on
the Company or such Subsidiary.
2.4 “Code” means the Internal
Revenue Code of 1986, as amended.
2.5 “Committee” means the members of
the Board’s Compensation Committee who are
“disinterested persons” as defined in
Rule 16b-3(b)(3)(i)
promulgated under the Securities Exchange Act of 1934, as
amended, as it exists on the effective date of the Plan or as
subsequently amended or interpreted and who are “outside
directors” within the meaning of Section 162(m) of the
Code and the regulations thereunder.
2.6 “EBITDA” means the
Company’s consolidated earnings before interest, taxes,
depreciation and amortization, as derived from the
Company’s audited financial statements as the sum of
operating income plus depreciation and amortization, as
calculated by the Committee.
2.7 “Company” means Saia, Inc., a
Delaware corporation.
2.8 “Fair Market Value” means with
respect to the Company’s Shares the closing price of the
Shares as reported by NASDAQ or if the closing price is not
reported, the bid price of the Shares as reported by NASDAQ.
2.9 “Grantee” means a person to whom
an Award is made.
2.10 “Incentive Stock Option” or
“ISO” means an Option awarded under the Plan
which meets the requirements of Section 422 of the Code and
the regulations thereunder.
2.11 “NASDAQ” means the National
Association of Securities Dealers Automated Quotation System.
2.12 “Non-Employee Director” means a
director of the Company who is not also an employee of the
Company or any Subsidiary.
2.13 “Non-Qualified Stock Option” or
“NQSO” means an Option awarded under the Plan,
which is not an ISO.
2.14 “Option” means the right to
purchase, at a price, for a Term, under conditions, and for cash
or other considerations fixed by the Committee in accordance
with the Plan, and subject to such other limitations and
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restrictions as the Plan and the Committee impose, a number of
Shares specified by the Committee. An Option may be either an
ISO or an NQSO or a combination thereof.
2.15 “Performance Unit Award” means
an award tied to selected performance criteria. Performance Unit
Awards will provide for payment of an award in shares, as
determined by the Committee, if performance goals are achieved
over specified performance periods.
2.16 “Plan” means this Saia, Inc.
Amended and Restated 2003 Omnibus Incentive Plan.
2.17 “Restricted Stock Award” means
the grant of a right to receive, at a time or times fixed by the
Committee in accordance with the Plan, and subject to such other
limitations and restrictions as the Plan and the Committee
impose, the number of Shares specified by the Committee.
2.18 “Right of First Refusal” means
the right of the Company to be given the opportunity to
repurchase Shares awarded under the Plan at their then Fair
Market Value prior to such Shares being offered for sale to any
other party. This right shall apply to any Shares awarded under
the Plan under terms and conditions established by the Committee
at the time of Award, and shall apply to all Grantees and their
guardians, legal representatives, joint tenants, tenants in
common, heirs or Successors.
2.19 “SAR” means a right to
surrender to the Company all or a portion of an Option and to be
paid therefore an amount, as determined by the Committee, no
greater than the excess, if any, of (a) the Fair Market
Value, on the date such right is exercised, of the Shares to
which the Option or portion thereof relates, over (b) the
aggregate Option price of those Shares.
2.20 “Shares” means shares of the
Company’s common stock or, if by reason of the adjustment
provisions hereof any rights under an Award under the Plan
pertain to any other security, such other security.
2.21 “Subsidiary” means any
business, whether or not incorporated, in which the Company, at
the time an Award is granted to an employee thereof, or in other
cases, at the time of reference, owns directly or indirectly not
less than 50% of the equity interest.
2.22 “Successor” means the legal
representative of the estate of a deceased Grantee or the person
or persons who shall acquire the right to exercise an Option or
an SAR, or to receive Shares issuable in satisfaction of a
Restricted Stock Award, by bequest or inheritance or by reason
of the death of the Grantee, as provided in accordance with
Section 12 hereof.
2.23 “Term” means the period during
which a particular Option or SAR may be exercised or the period
during which the restrictions placed on a Restricted Stock Award
are in effect.
2.24 “Total Disability” means total
disability as defined under the Company’s or any
Subsidiary’s group insurance plan covering total
disability. In the absence of such insurance plan the Committee
shall make such determination.
3.1 The Plan shall be administered by the Committee.
3.2 The Committee shall have plenary authority,
subject to the provisions of the Plan, to determine when and to
whom Awards shall be granted, the Term of each Award, the number
of Shares covered by the Award, and all other terms or
conditions of the Award. The Committee may grant such additional
benefits in connection with any Award as it deems appropriate.
The number of Shares, the Term, the other terms and conditions
of a particular kind of Award and any additional benefits
granted in connection with any Award need not be the same, even
as to Awards made at the same time. The Committee’s actions
in granting Awards, in setting their terms and conditions, and
in granting any additional benefits in connection with any
Award, shall be conclusive on all persons.
3.3 The Committee shall have the sole responsibility
for construing and interpreting the Plan, for establishing and
amending such rules and regulations as it deems necessary or
desirable for the proper administration of the Plan, and for
resolving all questions arising under the Plan. Any decision or
action taken by the Committee
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arising out of, or in connection with, the construction,
administration, interpretation and effect of the Plan and of its
rules and regulations shall be conclusive and binding upon all
Grantees, Successors, and all other persons.
3.4 The Committee shall regularly inform the Board of
its actions with respect to all Awards under the Plan and the
terms and conditions of such Awards in a manner, at such times,
and in such form as the Board may reasonably request.
3.5 The performance criteria for Awards made to any
“covered employee” (as defined in Section 162(m)
of the Code), and which are intended to qualify as
“performance-based compensation” (as defined in
Section 162(m) of the Code), shall consist of objective
tests established by the Committee based on one or more of the
indicators of performance described in Section 8.2.
Awards may be made under the Plan to employees of the Company or
a Subsidiary who have executive, managerial, supervisory or
professional responsibilities. In making a determination
concerning the granting of Awards to eligible employees, the
Committee may take into account the nature of the services they
have rendered or that the Committee expects they will render,
their present and potential contributions to the success of the
business, the number of years of effective service they are
expected to have and such other factors as the Committee in its
sole discretion shall deem relevant. Awards may be made to
Non-Employee Directors pursuant to Section 10.
Subject to adjustment as provided in Section 21 below,
424,000 Shares are hereby reserved for issuance in
connection with Awards under the Plan. The Shares so issued may
be unreserved Shares held in the treasury however acquired or
Shares which are authorized but unissued. For purposes of
determining the number of Shares issued under the Plan, no
Shares shall be deemed issued until they are actually delivered
to a Grantee or such other person described in Section 11.
Shares covered by Awards that either wholly or partly are not
earned, or that expire or are forfeited, cancelled or terminated
shall be available for future issuance of Awards. Subject to
adjustment as provided in Section 21 below:
(a) the maximum number of Shares with respect to which
Options and SAR’s may be granted during the term of the
Plan to an employee under the Plan is 100,000 Shares;
(b) the maximum number of Shares with respect to which
Restricted Stock Awards and awards of Shares may be granted
during the term of the Plan to an employee or Non-Employee
Director under the Plan is 50,000 Shares; and
(c) the maximum number of Shares with respect to which
Restricted Stock Awards and awards of Shares may be granted in
the aggregate during the term of the Plan is 100,000 Shares.
6.1 Subject to the terms of the Plan, the Committee
may from time to time grant Options to eligible employees.
6.2 The aggregate Fair Market Value (as determined on
the date of grant) of ISO Awards to an individual Grantee and
exercisable for the first time during any calendar year shall
not exceed $100,000.
6.3 The purchase price of each Share subject to
Options shall be fixed by the Committee, but shall not be less
than 100% of the Fair Market Value of the Shares on the date the
Option is granted. Except as otherwise provided in
Section 21, in no event may an Option be repriced.
6.4 The minimum purchase price of an ISO Award shall
be 110% of Fair Market Value with respect to Grantees who at the
time of Award are deemed to own 10% or more of the voting power
of the Company as defined by the Code.
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6.5 Each Option shall expire and all right to
purchase Shares thereunder shall cease on the date fixed by the
Committee, which subject to the terms of the Plan, shall not be
later than the tenth anniversary of the date on which the Option
was granted.
6.6 ISO awards shall expire and all rights to
purchase Shares thereunder shall cease no later than the fifth
anniversary of the date on which the Option was granted with
respect to Grantees who at the time of Award are deemed to own
10% or more of the voting power of the Company as defined by the
Code.
6.7 Each Option shall become exercisable at the time,
and for the number of Shares, fixed by the Committee. Except to
the extent otherwise provided in or pursuant to Sections 12
and 13, no Option granted to employees shall become
exercisable as to any Shares during the first six months after
the date on which the Option was granted.
6.8 Subject to the terms of the Plan, the Committee
may make all or any portion of Option Shares subject to a Right
of First Refusal for any period of time set by the Committee at
the time of Award.
6.9 Each Option granted under this Section 6
shall be evidenced by an agreement with the Company which shall
contain the terms and provisions set forth herein and shall
otherwise be consistent with the provisions of the Plan.
7.1 The Committee may, in its discretion, grant an
SAR to any employee that is the holder of an Option, either at
the time the Option is granted or by amending the instrument
evidencing the grant of the Option at any time after the Option
is granted and more than six months before the end of the Term
of the Option, so long as the grant is made during the period in
which grants of SARs may be made under the Plan.
7.2 Each SAR shall be for such Term, and shall be
subject to such other terms and conditions, as the Committee
shall impose. The terms and conditions may include Committee
approval of the exercise of the SAR, limitations on the time
within which and the extent to which such SAR shall be
exercisable, limitations on the amount of appreciation which may
be recognized with regard to such SAR, and specification of what
portion, if any, of the amount payable to the Grantee upon his
or her exercise of an SAR shall be paid in cash and what
portion, if any, shall be payable in Shares. If and to the
extent that Shares are issued in satisfaction of amounts payable
on exercise of an SAR, the Shares shall be valued at their Fair
Market Value on the date of exercise.
7.3 Except to the extent otherwise provided in
Sections 12 and 13, no SAR shall be exercisable during
the first six months after its date of grant.
7.4 Upon exercise of an SAR, the Option, or portion
thereof, with respect to which such right is exercised shall be
surrendered and shall not thereafter be exercisable.
8.1 The Committee may designate employees as Grantees
of Performance Unit Awards and shall establish performance
periods under the Performance Unit Awards, provided that the
total value of the awards (determined as of the date of grant)
covered by all Performance Unit Awards granted to a
“covered employee” (as defined in Section 162(m)
of the Code) with respect to a performance period shall not
exceed 1% of EBITDA for the Company and its Subsidiaries on a
consolidated basis for the three fiscal years immediately
preceding the grant; provided, further that the total value of
the awards (determined as of the date of grant) covered by all
Performance Unit Awards granted to all “covered
employees” (as defined in Section 162(m) of the Code)
as a group with respect to a performance period shall not exceed
2% of EBITDA for the Company and its Subsidiaries on a
consolidated basis for the three fiscal years immediately
preceding the grant.
8.2 The Committee shall establish indicators of
performance applicable to the relevant performance period.
Indicators of performance are utilized to determine the amount
and timing of Performance Unit Awards, and may vary between
performance periods and different Performance Unit Awards. The
indicators of performance shall be one or more of the following:
the Company’s pretax income, net income, earnings per
Share, revenue, expenses, return on assets, return on equity,
return on investment, return on capital, net profit margin,
operating profit margin, cash flow, total stockholder return,
capitalization, liquidity, results of customer satisfaction
surveys, quality, safety, productivity, cost management or
process improvement or any combination of the foregoing as the
Committee
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approves. Such performance goals may be determined solely by
reference to the performance of the Company, a Subsidiary, or a
division or unit of any of the foregoing, or based upon
comparisons of any of the indicators of performance relative to
other companies. The Committee may also exclude the impact of
any event or occurrence which the Committee determines should
appropriately be excluded such as, for example, a restructuring
or other nonrecurring charge, an event either not directly
related to the operations of the Company or not within the
reasonable control of the Company’s management, or a change
in accounting standards required by U.S. generally accepted
accounting principles.
8.3 Subject to the terms of the Plan, the Committee
may make downward adjustments in Performance Unit Awards to
Grantees.
8.4 At the time of making grants of Performance Unit
Awards, the Committee shall establish such terms and conditions
as it shall determine applicable to such Awards. The number of
shares paid in settlement of the Performance Unit Awards shall
be determined based on the fair market value of shares on the
date of settlement of the Performance Unit Awards.
8.5 Subject to applicable restrictions under
Section 162(m) of the Code, the Committee shall determine
the extent to which an Employee shall participate in a partial
performance period because of becoming eligible to be a Grantee
after the beginning of such performance period. In the event a
Grantee is involuntarily terminated without cause or terminates
employment due to death, Total Disability or retirement (as
determined by the Committee), after completing at least 50% of
the performance period for an Award, such Grantee shall be
entitled to a pro rata portion of the Award if the indicators of
performance are met, payable in accordance with procedures
established by the Committee.
9.1 Subject to the terms of the Plan, the Committee
may also grant eligible employees Restricted Stock Awards.
9.2 The terms and conditions of such Awards,
including restrictions on transfer or on the ability of the
Grantee to make elections with respect to the taxation of the
Award without the consent of the Committee, shall be determined
by the Committee. Except as provided in or pursuant to
Sections 12 and 13, no such restrictions shall lapse
earlier than the first, or later than the tenth, anniversary of
the date of the Award.
9.3 The Committee may establish terms and conditions
under which the Grantee of a Restricted Stock Award shall be
entitled to receive a credit equivalent to any dividend payable
with respect to the number of Shares which, as of the record
date for such dividend, have been awarded but not delivered to
him or her. Any such dividend equivalents shall be paid to the
Grantee of the Restricted Stock Award at such time or times
during the period when the Shares are being held by the Company
pursuant to the terms of the Restricted Stock Award, or at the
time the Shares to which the dividend equivalents apply are
delivered to the Grantee, as the Committee shall determine. Any
arrangement for the payment of dividend equivalents shall be
terminated if, under the terms and conditions established by the
Committee, the right to receive Shares being held pursuant to
the terms of the Restricted Stock Award shall lapse.
9.4 Subject to the terms of the Plan, the Committee
may make all or any portion of Shares Awarded under a
Restricted Stock Award subject to a Right of First Refusal for
any period of time set by the Committee at the time
of Award.
9.5 The Committee may adopt and apply rules to ensure
compliance with tax withholding requirements, including, but not
limited to, the retention of a sufficient number of restricted
shares upon which restrictions have lapsed to pay such tax.
10.1 Mandatory Retainer Awards. At
the later of (i) the Board of Directors meeting immediately
following the Company’s annual meeting of stockholders in
each calendar year, and (ii) the third business day after
the announcement of the Company’s earnings results for the
quarter ended prior to the Company’s annual meeting of
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stockholders in each calendar year, each Non —
Employee Director shall be granted an award of Shares equal in
value to fifty percent (50%) of the then applicable level of
annual Board and committee retainers, with the value of the
Shares to be computed for the purposes of determining the number
of Shares awarded by reference to the Fair Market Value of a
Share on the date of the award of the Shares. Any Non-Employee
Director appointed to the Board of Directors other than at the
Company’s annual meeting of stockholders shall be granted
upon his or her appointment an award of Shares equal in value to
fifty percent (50%) of the then applicable level of annual Board
and committee retainers, reduced proportionately as the
Committee deems appropriate based on the time remaining until
the next annual meeting of stockholders, with the value of
Shares to be computed for the purposes of determining the number
of Shares awarded by reference to the Fair Market Value of a
Share on the date of the award of the Shares. Fractional Shares
shall be rounded off to the nearest whole share. Such award
shall be in lieu of fifty percent (50%) of the annual Board and
Committee retainers otherwise payable to the Non-Employee
Directors in cash. To the extent that there are insufficient
Shares available for Awards, the Awards to all Non-Employee
Directors for that year shall be proportionately reduced and the
balance paid in cash. Notwithstanding the preceding, any award
made under this Section 10.1 to the non-executive chairman
of the Board may, at the discretion of the Committee, be made in
cash rather than in Shares.
10.2 Discretionary Retainer
Awards. Each Non-Employee Director shall annually
have the option of receiving up to 100% of the applicable level
of annual Board and committee retainers in Shares rather than
cash. Should any Non-Employee Director desire to take advantage
of this option, such Non-Employee Director shall so notify the
Committee no later than seven (7) calendar days prior to
each year’s annual meeting of stockholders, which
notification shall advise the Committee the percentage over and
above the mandatory 50% of the annual Board and committee
retainers the Non-Employee Director wishes to receive in Shares
rather than cash. The number of Shares that shall be awarded to
any such Non-Employee Director under this provision shall be
determined in the same manner as the awards described in
Section 10.1 above.
10.3 Non-Retainer Equity Awards. In
addition to the Mandatory Retainer Award under Section 10.1
above, at the later of (i) the Board of Directors meeting
immediately following the Company’s annual meeting of
stockholders in each calendar year, and (ii) the third
business day after the announcement of the Company’s
earnings results for the quarter ended prior to the
Company’s annual meeting of stockholders in each calendar
year, each Non-Employee Director shall be granted an award of
not more than 3,000 Shares (with the exact number of Shares
to be determined by the Committee). Any Non-Employee Director
appointed to the Board of Directors other than at the
Company’s annual meeting of stockholders shall be granted
upon his or her appointment an award of not more than
3,000 Shares (with the exact number of Shares to be
determined by the Committee reduced proportionately based on the
time remaining until the next annual meeting of stockholders).
10.4 Deferral of
Awards. Notwithstanding Sections 10.1, 10.2
and 10.3, each Non-Employee Director shall have the right to
defer all or a portion of his or her Mandatory Retainer Awards
under Section 10.1, Discretionary Awards under
Section 10.2, and Non-Retainer Equity Awards under
Section 10.3 under the Saia, Inc. Directors’ Deferred
Fee Plan.
No rights under any Award shall be transferable otherwise than
by will or the laws of descent and distribution. Notwithstanding
the foregoing, to the extent allowed by
Rule 16b-3
or any successor rule promulgated under the Securities Exchange
Act of 1934, as amended from time to time, as then applicable to
the Company’s benefit plans, the Committee may permit an
NQSO to be transferred to a member or members of the
Grantee’s immediate family, or to a trust for the benefit
for such immediate family member(s) or a partnership, limited
liability company, or similar entity in which such immediate
family member(s) comprise the majority partners or equity
holders. For purposes of this provision, a Grantee’s
immediate family shall mean the Grantee’s spouse, children
and grandchildren.
12.1 Subject to the provisions of the Plan, the
Committee may make such provisions concerning exercise or lapse
of Options or SARs on death or termination of employment as it
shall, in its discretion, determine. No such
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provision shall extend the Term of an Option or SAR, nor shall
any such provision permit an Option or SAR to be exercised prior
to six months after the date on which it was granted, except in
the event of death or termination by reason of disability.
12.2 Subject to the provisions of the Plan and
pursuant to the Code, no ISO shall be exercisable as an ISO
after the date which is three months following a Grantee’s
termination of employment for any reason other than disability
or death, or twelve months following a Grantee’s
termination of employment by reason of disability. Following a
Grantee’s death, the executor, administrator or other
person acquiring an ISO by bequest or inheritance or by reason
of the death of the Grantee may exercise it at any time during
its remaining Term, provided the deceased Grantee was an
employee either at the time of his death or within three months
prior to death.
12.3 The effect of death or termination of employment
on Shares issued or issuable pursuant to any Restricted Stock
Awards and on cash payable pursuant to a Performance Unit Award
shall be as stated in the Award.
12.4 Transfers of employment between the Company and
a Subsidiary, or between Subsidiaries, shall not constitute
termination of employment for purposes of any Award. The
Committee may specify in the terms and conditions of an Award,
whether any authorized leave of absence or absence for military
or government service or for any other reason shall constitute a
termination of employment for purposes of the Award and the Plan.
The Committee may provide that in the event the Company is to be
wholly or partly liquidated, or agrees to participate in a
merger, consolidation or reorganization in which it, or any
entity controlled by it, is not the surviving entity, any and
all Options and SARs granted under the Plan shall be immediately
exercisable in full, any or all Restricted Stock Awards made
under the Plan shall be immediately payable in full and any
award agreement with respect to a Performance Unit Award will
terminate and be of no further force and the amounts payable
thereunder in such event shall be as specified in the award
agreement. The Committee may also provide that the Grantees be
paid the consideration received by stockholders in such
transaction, minus (1) the Option price of the
Grantee’s Options and (2) the Fair Market Value of
Shares covered by SARs on the date of grant of the SARs, in full
satisfaction of such Options and SARs.
Each Award granted under the Plan shall be evidenced by a
writing which may, but need not, be in the form of an agreement
to be signed by the Grantee. The writing shall set forth the
nature and size of the Award, its Term, the other terms and
conditions thereof, other than those set forth in the Plan, and
such other information as the Committee directs. Acceptance of
any benefits of an Award by the Grantee shall be conclusively
presumed to be an assent to the terms and conditions set forth
therein, whether or not the writing is in the form of an
agreement to be signed by the Grantee.
15.1 A person entitled to exercise an Option or SAR
may do so by delivery of a written notice to that effect
specifying the number of Shares with respect to which the Option
or SAR is being exercised and any other information the
Committee may prescribe.
15.2 In the case of an exercise of an Option, the
notice shall be accompanied by payment in full for the purchase
price of any Shares to be purchased with such payment being made
(i) in cash; (ii) in Shares having a Fair Market Value
equivalent to the purchase price of such Option; (iii) in a
combination thereof; or (iv) by means of a cashless
exercise pursuant to the cashless exercise program offered by
the Company (if any, and to the extent allowed by law). No
Shares shall be issued upon exercise of an Option until full
payment has been made therefor.
15.3 The notice of exercise of an SAR shall be
accompanied by the Grantee’s copy of the writing or
writings evidencing the grant of the SAR and the related Option.
15.4 Upon exercise of an Option or SAR, or grant of a
Restricted Stock Award but before a distribution of Shares in
satisfaction thereof, the Grantee may request in writing that
the Shares to be issued in satisfaction of the
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Award be issued in the name of the Grantee or the Grantee and
another person as joint tenants with right of survivorship or as
tenants in common.
15.5 If a Right of First Refusal has been required
for some or all of the Shares applicable to an Option, SAR, or
Restricted Stock Award, the Grantee shall be required to
acknowledge in writing his or her understanding of such Right of
First Refusal and the legend which shall be placed on the
certificates for such Shares.
15.6 All notices or requests provided for herein
shall be delivered to the Secretary of the Company.
16.1 The Plan shall become effective on
January 23, 2003, subject to approval within one
(1) year thereafter by the Company’s stockholders.
16.2 No Awards may be granted under the Plan on or
after January 22, 2013 although the terms of any Award may
be amended at any time prior to the end of its Term in
accordance with the Plan.
The date of an Award shall be the date on which the
Committee’s determination to grant such Award is final, or
such later date as shall be specified by the Committee.
No person shall have any rights as a stockholder by virtue of
the grant of an Award under the Plan except with respect to
Shares actually issued to that person.
The Committee may postpone any exercise of an Option or SAR or
the distribution of any portion of a Restricted Stock Award or
the grant of Shares for such time as the Committee, in its
discretion, may deem necessary in order to permit the Company
(i) to effect or maintain registration of the Plan or the
Shares issuable upon the exercise of an Option or an SAR or
distributable in satisfaction of a Restricted Stock Award or
pursuant to a grant of Shares under the Securities Act of 1933,
as amended, or the securities laws of any applicable
jurisdiction, (ii) to permit any action to be taken in
order to comply with restrictions or regulations incident to the
maintenance of a public market for its Shares, or (iii) to
determine that such Shares and the Plan are exempt from such
registration or that no action of the kind referred to in
(i) or (ii) above needs to be taken. The Company shall
not be obligated by virtue of any terms and conditions of any
Award or any provision of the Plan to recognize the exercise of
an Option or an SAR or to sell or issue shares in violation of
the Securities Act of 1933 or the law of any government having
jurisdiction thereof. Any such postponement shall not extend the
Term of an Option or SAR nor shorten the Term of any restriction
attached to any Restricted Stock Award. Neither the Company nor
its directors or officers shall have any obligation or liability
to any Grantee, to the Grantee’s Successor or to any other
person with respect to any Shares with respect to which the
Option or SAR shall lapse because of such postponement or as to
which issuance under a Restricted Stock Award was delayed.
The Board may at any time terminate, suspend or modify the Plan,
except that the Board shall not, without authorization of the
Company’s stockholders in accordance with the requirements
of Section 16, effect any change (other than through
adjustment for changes in capitalization as herein provided)
which:
20.1 increases the aggregate number of Shares for
which Awards may be granted;
20.2 lowers the minimum Option price;
20.3 lengthens the maximum period during which an
Option or SAR may be exercised;
20.4 increases the maximum amount a Grantee may be
paid upon the exercise of an SAR;
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20.5 disqualifies any member of the Committee from
being a “disinterested person” as defined in
Rule 16b-3(b)(3)(i)
promulgated under the Securities Exchange Act of 1934, as
amended;
20.6 changes the class of employees eligible to
receive Awards; or
20.7 extends the period of time during which Awards
may be granted.
No termination, suspension or modification of the Plan shall
adversely affect any right acquired by any Grantee or any
Successor under an Award granted before the date of such
termination, suspension or modification, unless such Grantee or
Successor shall consent; but it shall be conclusively presumed
that any adjustment for changes in capitalization as provided
for herein does not adversely affect any such right. Except as
described above, the Committee may amend the Plan and any Award
granted under the Plan as the Committee deems necessary or
appropriate to comply with Section 409A of the Code.
Any increase in the number of outstanding Shares of the Company
occurring through stock splits or stock dividends after the
adoption of the Plan shall be reflected proportionately in an
increase in the aggregate number of Shares then available for
the grant of Awards under the Plan, or becoming available
through the termination, surrender or lapse of Awards previously
granted but unexercised, and an increase in the number of Shares
subject to Awards then outstanding; and in the number of Shares
available for grant under Section 10; and a proportionate
reduction shall be made in the per Share option price as to any
outstanding Options. Any fractional shares resulting from such
adjustment shall be eliminated. If changes in capitalization
other than those considered above shall occur, the Board shall
make such adjustment in the number or class of Shares, remaining
subject to Awards then outstanding and in the per Share Option
price as the Board in its discretion may consider appropriate,
and all such adjustments shall be conclusive upon all persons.
22.1 Any employee otherwise eligible for an Award
under the Plan who is eligible to receive a cash incentive
payment from the Company under any management incentive plan may
make application to the Committee in such manner as may be
prescribed from time to time by the Committee, to receive Shares
from the Plan in lieu of all or any portion of such cash payment.
22.2 The Committee may in its discretion honor such
application by delivering Shares from the Plan to such employee
equal in Fair Market Value to that portion of the cash payment
otherwise payable to the employee under such incentive plan for
which a Share delivery is to be made in lieu of cash payment.
22.3 Any Shares delivered to employees under the Plan
in lieu of cash incentive payments shall come from the aggregate
number of Shares authorized for use by the Plan and shall not be
available for any other Awards under the Plan.
The Committee’s determination under the Plan including,
without limitation, determination of the persons to receive
Awards, the form, amount and type of Awards, the terms and
provisions of Awards and the written material evidencing such
Awards, the grant of additional benefits in connection with any
Award, and the granting or rejecting of applications for
delivery of Shares in lieu of cash bonus or incentive payments
need not be uniform and may be made selectively among otherwise
eligible employees, whether or not such employees are similarly
situated.
The Company may withhold amounts necessary to satisfy its tax
withholding obligations with respect to Awards.
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An employee’s right, if any, to continue in the employ of
the Company or a Subsidiary shall not be affected by the fact
that he or she has been granted an Award. At the sole discretion
of the Committee, an employee terminated for Cause may be
required to forfeit all of his or her rights under the Plan,
except as to Options or SARs already exercised and Restricted
Stock Awards on which restrictions have already lapsed.
The proceeds received by the Company from the sale of its Shares
under the Plan shall be used for general corporate purposes.
Nothing in the Plan shall be construed to limit the authority of
the Company to exercise its corporate rights and powers,
including the right to grant options for proper corporate
purposes otherwise than under the Plan to any person, firm,
corporation, association or other entity, or to grant options
to, or assume options of, any person in connection with the
acquisition, by purchase, lease, merger, consolidation or
otherwise, of all or any part of the business and assets of any
person, firm, corporation, association or other entity.
The Plan and all determinations made and action taken pursuant
hereto shall be governed by and construed in accordance with the
laws of the state of Delaware, without regard to the principles
of conflicts of law which might otherwise apply.
As amended January 30, 2007.
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Exhibit C
WHEREAS, Saia, Inc. (“Company”) previously
adopted the Saia, Inc. Amended and Restated 2003 Omnibus
Incentive Plan (“Plan”);
WHEREAS, Section 20 of the Plan affords the Board of
Directors (the “Board”) of the Company the authority
to amend the Plan subject to the approval of the Company’s
stockholders in certain instances; and
WHEREAS, the Board desires to amend the Plan, and
recommend the amendments to the Company’s stockholders for
approval at the Company’s annual meeting in 2007.
NOW THEREFORE, effective upon the approval of the
Company’s stockholders at the Company’s annual meeting
in 2007, the Plan is amended as follows:
1. Section 5 is deleted in its entirety and replaced
with the following:
Subject to adjustment as provided in Section 21 below,
824,000 Shares are hereby reserved for issuance in
connection with Awards under the Plan. The Shares so issued may
be unreserved Shares held in the treasury however acquired or
Shares which are authorized but unissued. For purposes of
determining the number of Shares issued under the Plan, no
Shares shall be deemed issued until they are actually delivered
to a Grantee or such other person described in Section 11.
Shares covered by Awards that either wholly or partly are not
earned, or that expire or are forfeited, cancelled or terminated
shall be available for future issuance of Awards. Subject to
adjustment as provided in Section 21 below:
(a) the maximum number of Shares with respect to which
Options and SAR’s may be granted during the term of the
Plan to an employee under the Plan is 200,000 Shares;
(b) the maximum number of Shares with respect to which
Restricted Stock Awards and awards of Shares may be granted
during the term of the Plan to an employee or Non-Employee
Director under the Plan is 100,000 Shares; and
(c) the maximum number of Shares with respect to which
Restricted Stock Awards and awards of Shares may be granted in
the aggregate during the term of the Plan is 200,000 Shares.
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EBC Office and Conference Center,
11330 Lakefield Dr., Bldg. 2, Duluth, Georgia 30097.
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SAIA, INC.
The
Board of Directors recommends a vote FOR the nominees named hereon, and “FOR” proposals 2 and 3.
Vote on Directors
1. Elect three directors, each for a term of three years:
Vote on Proposal
Please
be sure to sign and date this Proxy. Date
Please sign
as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title.
UMB BANK SECURITIES TRANSFER DIVISION P.O. BOX 419064 KANSAS CITY, MO 64141-6064 VOTE BY INTERNET —
www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE SHAREHOLDER COMMUNICATIONS
If you would like to reduce the costs incurred by Saia, Inc. in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access shareholder communications electronically in future years. VOTE BY PHONE — 1-800-454-8683
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Saia, Inc., c/o ADP, 51 Mercedes Way, Edgewood, NY 11717. You can view the Annual Report and Proxy Statement
on the internet at: http://www.saia.com
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SAIA, INC.
PROXY ANNUAL MEETING OF SHAREHOLDERS, APRIL 19, 2007 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. The undersigned hereby appoints HERBERT A. TRUCKSESS, III, JOHN J. HOLLAND and JAMES A. DARBY, and
each
of them, with full power of substitution, proxies of the undersigned to vote the shares of Common
Stock of Saia, Inc. standing
in the name of the undersigned or with respect to which the undersigned is entitled to vote, at the
Annual Meeting of
Shareholders of Saia, Inc. to be held at the EBC Office and Conference Center, 11330 Lakefield Dr.
Bldg 2, Duluth, GA 30097,
on April 19, 2007 at 10:30 a.m., and at any adjournments thereof. Without limiting the authority
granted herein, the above named
proxies are expressly authorized to vote as directed by the undersigned as to those matters set
forth on the reverse side hereof and
in their discretion on all other matters that are properly brought before the Annual Meeting.
If more than one of the above named proxies shall be present in person or by substitution at such
meeting or at any adjournment
thereof, the majority of said proxies so present and voting, either in person or by substitution,
shall exercise all of the powers
hereby given. The undersigned hereby revokes any proxy heretofore given to vote at such meeting.
This proxy, when properly executed, will be voted in the manner directed herein by the undersigned
shareholder. If no
choice is specified, this proxy will be voted “FOR” the nominees named hereon, and “FOR” proposal
2.
PLEASE NOTE ADDRESS CHANGES HERE
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
YOUR VOTE IS IMPORTANT!
If you vote by the Internet or telephone, DO NOT return your proxy card.
VOTE BY
INTERNET***TELEPHONE***MAIL 24 hours a day - 7 days a week Your vote is important. Please vote immediately.
Your Internet or telephone vote authorizes the named proxies to vote your shares in the same
manner as if you marked, signed and returned your proxy card.
Vote-by-Mail
Mark, sign and date your proxy card and return it in the postage-paid envelope we have
provided or return it to Saia, Inc., c/o ADP, 51 Mercedes Way, Edgewood, NY 11717.
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