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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
</TABLE>
UNIFAB International, Inc.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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<PAGE> 2
[UNIFAB INTERNATIONAL, INC. LOGO]
UNIFAB INTERNATIONAL, INC.
5007 PORT ROAD
NEW IBERIA, LOUISIANA 70562
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 14, 2000
---------------------
<TABLE>
<S> <C>
DATE: Thursday, September 14, 2000
TIME: 10:00 A.M. C.D.T.
PLACE: 5007 Port Road, New Iberia, Louisiana
PURPOSE: - To elect two directors;
- To ratify the appointment of Ernst & Young LLP as our
independent auditors to audit our financial statements
for fiscal 2001; and
- To transact such other business as may properly come
before the annual meeting.
RECORD DATE: Close of business on August 4, 2000
</TABLE>
Your vote is important. Whether or not you plan to attend the meeting,
please complete, sign and date the enclosed proxy card and return it promptly in
the enclosed envelope. You may revoke your proxy at any time before it is voted.
We appreciate your cooperation.
By Order of the Board of Directors
Peter J. Roman
Secretary
New Iberia, Louisiana
August 11, 2000
<PAGE> 3
UNIFAB INTERNATIONAL, INC.
5007 PORT ROAD
NEW IBERIA, LOUISIANA 70562
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 14, 2000
We will begin mailing this proxy statement to our shareholders on or about
August 11, 2000.
We are furnishing this proxy statement to our shareholders in connection
with the solicitation of proxies on behalf of our board of directors for use at
our 2000 annual meeting of shareholders to be held on Thursday, September 14,
2000, at 10:00 A.M. C.D.T. at our offices, 5007 Port Road, New Iberia,
Louisiana.
WHO CAN VOTE
If you held any of our common stock at the close of business on August 4,
2000, then you are entitled to notice of and to vote at our 2000 annual meeting.
On that date 6,845,701 shares of our common stock were outstanding.
QUORUM
The presence of a majority of our common stock entitled to vote, present in
person or represented by proxy, is necessary to constitute a quorum. For
purposes of determining a quorum, we will count as present shares of common
stock present at the meeting that abstain from voting or that are the subject of
broker non-votes. A broker non-vote occurs when a broker, or the broker's
nominee, who holds common stock for a beneficial owner does not vote on a
particular matter because the broker or nominee does not have discretionary
voting power with respect to that matter and has not received voting
instructions from the beneficial owner.
VOTING RIGHTS
Each share of our common stock that you hold entitles you to one vote on
all matters that come before the annual meeting. One or more inspectors of
election will count votes cast at the annual meeting. Directors will be elected
by a plurality of the shares voted (that is, the two nominees receiving the
largest number of votes will be elected). All other matters voted on are decided
by a majority of the votes actually cast, except as otherwise provided by
statute, our articles of incorporation and our bylaws.
Abstentions and broker non-votes are not considered as cast in the election
of directors or as to any matter expected to come before the annual meeting and
will have no effect on the outcome.
HOW YOUR PROXY WILL BE VOTED
Our board of directors is soliciting a proxy in the enclosed form to
provide you with an opportunity to vote on all matters scheduled to come before
the annual meeting, whether or not you attend in person.
Granting Your Proxy
If you properly execute and return a proxy in the enclosed form, your stock
will be voted as you specify. If you make no specifications, the proxy
representing your common stock will be voted in favor of the proposed director
nominees and for the ratification of the appointment of auditors.
We expect no matter to be presented for action at the 2000 annual meeting
other than the items described in this proxy statement. The enclosed proxy will,
however, confer discretionary authority with respect to any other matter that
may properly come before the meeting. The persons named in the enclosed
<PAGE> 4
proxy intend to vote in accordance with their judgment on any matters that may
properly come before the annual meeting.
Revoking Your Proxy
If you submit a proxy, you may subsequently revoke it or submit a revised
proxy at any time before your proxy is voted. You may also attend the annual
meeting in person and vote by ballot, which would cancel any proxy that you
previously submitted.
PROXY SOLICITATION
We will pay all expenses of soliciting proxies for the 2000 annual meeting.
In addition to the use of the mails, proxies may be solicited by personal
interview, telephone, telefax and telegraph. We will request banks, brokerage
houses and other institutions, nominees and fiduciaries to forward solicitation
materials to the beneficial owners of our common stock and, upon their request,
we will reimburse such persons for reasonable out-of-pocket expenses incurred in
doing so.
SHAREHOLDER PROPOSALS
If you want us to consider including a proposal in next year's proxy
statement, you must deliver it in writing to Peter J. Roman, Secretary, UNIFAB
International, Inc., 5007 Port Road, New Iberia, Louisiana 70562 by November 27,
2000. Proxies solicited on behalf of our board of directors for next year's
annual meeting will confer discretionary authority to vote with respect to any
matter properly submitted by a shareholder for action at next year's annual
meeting if we do not receive notice of the matter on or before February 12,
2001.
ELECTION OF DIRECTORS
Our articles of incorporation and by-laws provide for a board of directors
of five natural persons, divided into three classes. The members of each class
serve for three years, with one class to be elected at each annual meeting. The
term of office of the Class III directors will expire at the 2000 annual
meeting.
Our board of directors has nominated each of the Class III directors named
below to serve for an additional three-year term expiring in 2003 and recommends
that shareholders vote FOR the re-election of the nominees. In the absence of
contrary instructions, the proxy holders will vote for the election of the two
nominees listed below. In the unanticipated event that any of the nominees is
unavailable as a candidate for director, the persons named in the accompanying
proxy will vote for a substitute candidate nominated by the board of directors.
2
<PAGE> 5
The following table sets forth as of July 1, 2000, for each nominee and
each of our other directors, his age, position, and principal occupation and
employment during the past five years, his directorships in other public
corporations, and the year that he was first elected a director of our company
or its predecessor.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION AND DIRECTORSHIPS IN DIRECTOR
NAME AND AGE OTHER PUBLIC CORPORATIONS SINCE
------------ ----------------------------------------- --------
<S> <C> <C>
NOMINEES FOR ELECTION AS CLASS III DIRECTORS (FOR TERM EXPIRING IN 2003)
Dailey J. Berard, 70..................... Mr. Berard is the founder of our company. 1980
Mr. Berard serves as our Chairman of the
Board, President and Chief Executive
Officer.
William A. Hines, 63..................... Mr. Hines is a director of our company. 1998
Mr. Hines is also Chairman of the Board
and President of Nassau Holding
Corporation, a manufacturer of couplings
for oilfield tubular goods and
distributor of oilfield tubular goods,
and a director of Whitney Holding
Corporation, a regional bank holding
company.
CONTINUING CLASS I DIRECTOR (TERM EXPIRES IN 2001)
Perry Segura, 70......................... Mr. Segura is a director of our company. 1980
Mr. Segura is an architect and real
estate developer. Mr. Segura has served
as Chairman of the Board of Supervisors
of Louisiana State University since 1997
and was its Vice Chairman from 1996 to
1997.
CONTINUING CLASS II DIRECTORS (TERM EXPIRES IN 2002)
Charles E. Broussard, 75................. Mr. Broussard is a director of our 1980
company. Mr. Broussard is also Chairman
of the Board and Chief Executive Officer
of Flying J. Ranch, Inc., a Louisiana
cattle and rice farm.
George C. Yax, 59........................ Mr. Yax is a director of our company. Mr. 1997
Yax was a co-founder of Ceanic
Corporation (formerly, American Oilfield
Divers, Inc.), a provider of subsea
products and services to the offshore oil
and gas industry, and served as its
Chairman of the Board until its sale in
August, 1998.
</TABLE>
Our board of directors has primary responsibility for directing our
management and affairs. During fiscal 2000, our board of directors held three
meetings. Each director attended 75% or more of the aggregate number of meetings
held during fiscal 2000 of the board of directors and committees of which he was
a member.
3
<PAGE> 6
To provide for effective direction and management of our business, our
board has established an audit committee and a compensation committee. Our board
does not have a nominating committee. The following tables provide you with
information about our audit and compensation committees. None of the members of
these committees is an officer or employee of us or any of our subsidiaries.
<TABLE>
<CAPTION>
NUMBER OF
MEETINGS
HELD IN
AUDIT COMMITTEE MEMBERS FUNCTIONS OF THE COMMITTEE FISCAL 2000
----------------------- -------------------------- -------------
<S> <C> <C>
William A. Hines - Reviews our financial statements and annual audit 1
Perry Segura - Meets with our independent auditors to review our internal
controls and financial management practices
- Exercises general oversight of the integrity and reliability of
our accounting and financial reporting practices and the
effectiveness of our system of internal controls
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF
MEETINGS
COMPENSATION COMMITTEE HELD IN
MEMBERS FUNCTIONS OF THE COMMITTEE FISCAL 2000
---------------------- -------------------------- -------------
<S> <C> <C>
Charles E. Broussard - Analyzes, reviews and makes recommendations to our board 1
George C. Yax concerning compensation programs
- Administers our long-term incentive plan
</TABLE>
DIRECTOR COMPENSATION
Each director who is not also an employee of the company receives an annual
fee of $12,000 for his services as a director. We reimburse all directors for
reasonable out-of-pocket expenses incurred in attending board and committee
meetings.
In addition, in each year during which our long-term incentive plan is in
effect and a sufficient number of shares are available under the plan, on the
day of each annual meeting of shareholders, each non-employee director will
receive an option to purchase no more than 2,500 shares of common stock at an
exercise price equal to the fair market value of our common stock on such date.
The compensation committee determines the exact number of shares subject to the
option. Each stock option will become fully exercisable on the date of its grant
and will expire ten years from the date of grant, unless the non-employee
director ceases to be a director. In that case, the exercise period will be
shortened. In accordance with this arrangement, on September 16, 1999, we
granted each non-employee director an option to buy 2,500 shares of our common
stock at an exercise price of $8.70, the fair market value of our common stock
on that date.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our directors
and executive officers and the beneficial owners of more than 10% of our common
stock to file certain beneficial ownership reports with the Securities and
Exchange Commission. Dailey J. Berard, our chief executive officer and a
director of our company, failed to report timely on a statement on Form 4 or on
a statement on Form 5 two transactions that occurred in fiscal 2000; they were
reported late on two statements on Form 4. David J. Berard, a former executive
officer of our company, failed to report timely on a statement on Form 5 one
transaction that occurred in fiscal 2000; it was reported late on a statement on
Form 4. Vincent J. Cuevas and Philip J. Patout, executive officers of our
company, each filed late his initial statement on Form 3. Peter J. Roman, an
executive officer of our company, failed to report timely on a statement on Form
5 one transaction that occurred in fiscal 2000; it was reported late on a
statement on Form 4. George C. Yax, a director of our company, failed to report
timely on two statements on Form 4 or a statement on Form 5 three transactions
that occurred in fiscal 2000; they were reported late on a statement on Form 4.
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<PAGE> 7
STOCK OWNERSHIP
The following table sets forth, as of July 1, 2000, certain information
regarding beneficial ownership of our common stock by (1) each of our directors,
(2) each of our executive officers for whom compensation information is
disclosed under the heading "Executive Officer Compensation" below, and (3) all
of our directors and executive officers as a group. Unless otherwise indicated,
we believe that the shareholders listed below have sole investment and voting
power with respect to their shares based on information furnished to us by them.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED(1) OUTSTANDING COMMON STOCK
------------------------ --------------------- ------------------------
<S> <C> <C>
Dailey J. Berard.................................... 515,386(2) 7.4%
Charles E. Broussard................................ 419,434(3) 6.1%
Vincent J. Cuevas................................... 76,012(4) 1.1%
William A. Hines.................................... 705,000 10.3%
Philip J. Patout.................................... 233,259 3.4%
Perry Segura........................................ 456,977(5) 6.7%
George C. Yax....................................... 17,500 *
All directors and executive officers as a group (8
persons).......................................... 2,442,442 35.0%
</TABLE>
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* Less than one percent.
(1) Includes shares that could be acquired within sixty days after July 1, 2000,
upon the exercise of options granted pursuant to our stock option plan, as
follows: Mr. Berard, 85,000 shares; Mr. Broussard, 7,500 shares; Mr. Cuevas,
10,000 shares; Mr. Hines, 5,000 shares; Mr. Segura, 7,500 shares; Mr. Yax,
7,500 shares; all directors and executive officers as a group (7 persons),
139,833 shares.
(2) Includes 15,700 shares owned by Mr. Berard's spouse. His address is c/o
UNIFAB International, Inc., 5007 Port Road, New Iberia, Louisiana 70562.
(3) Includes 151,900 shares owned by a company controlled by Mr. Broussard,
254,534 shares owned by a limited liability company controlled by Mr.
Broussard and 500 shares owned by his spouse. His address is 23604 South
Louisiana Highway 82, Kaplan, Louisiana 70548.
(4) Includes 3,000 shares held by the custodian of an individual retirement
account for the benefit of Mr. Cuevas.
(5) Includes 373,591 shares owned by a company controlled by Mr. Segura. His
address is 712 Darby Lane, New Iberia, Louisiana 70560.
5
<PAGE> 8
EXECUTIVE COMPENSATION
The following table provides you with information about the compensation we
paid in fiscal 2000, 1999, and 1998 to our chief executive officer and our other
executive officer whose individual salary and bonus for fiscal 2000 exceeded
$100,000 in the aggregate (collectively, the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION SECURITIES
FISCAL ------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS(#) COMPENSATION(1)
--------------------------- ------ -------- -------- ---------- ---------------
<S> <C> <C> <C> <C> <C>
Dailey J. Berard 2000 $180,000 $ 0 0 $3,600
President and Chief Executive 1999 180,000 75,600 30,000 3,600
Officer 1998 206,681 429,120 65,000 8,276
Vincent J. Cuevas(2) 2000 130,330 0 0 3,760
Vice President 1999 83,433 0 15,000 2,498
</TABLE>
----------
(1) Comprised of our contributions to our 401(k) Plan and interest, at the prime
rate as quoted by the Chase Manhattan Bank from time to time, earned on
deferred bonus compensation:
<TABLE>
<CAPTION>
INTEREST ON DEFERRED
NAME FISCAL YEAR PLAN CONTRIBUTIONS COMPENSATION
---- ----------- ------------------ --------------------
<S> <C> <C> <C>
Dailey J. Berard................................. 2000 $3,600 $ 0
1999 3,600 0
1998 3,219 5,057
Vincent J. Cuevas................................ 2000 3,760 0
1999 2,498 0
</TABLE>
(2) Mr. Cuevas began employment with us in July, 1998.
OUTSTANDING STOCK OPTIONS
The following table provides you with information about all outstanding
stock options held by each of the Named Executive Officers as of March 31, 2000.
None of our Named Executive Officers exercised stock options in fiscal 2000.
AGGREGATED OPTIONS AS OF MARCH 31, 2000
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT 3/31/00(#) AT 3/31/00(1)
------------------------- -------------------------
EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
------------------------- -------------------------
<S> <C> <C>
Dailey J. Berard................................. 85,000/10,000 $10,000/$5,000
Vincent J. Cuevas................................ 10,000/5,000 5,000/ 2,500
</TABLE>
----------
(1) Based on the difference between the closing sales price of our common stock
of $8.00 on March 31, 2000, as reported by the Nasdaq National Market and
the exercise price of such options.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the last fiscal year, Messrs. Broussard and Yax served on our
compensation committee. No member has ever served as an officer or employee of
our company or any of our subsidiaries. In fiscal 2000, none of our executive
officers served as a director or member of the compensation committee of another
entity, any of whose executive officers served on our board of directors or on
our compensation committee.
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<PAGE> 9
CERTAIN TRANSACTIONS
In connection with our acquisitions in July, 1998, of all the capital stock
of Allen Tank, Inc. and LATOKA USA, Inc. by means of mergers of those
corporations into two of our subsidiaries, we granted to each of the Allen Tank,
Inc. and LATOKA USA, Inc. shareholders, including William A. Hines, who became
one of our directors, and Vincent J. Cuevas, who subsequently became one of our
executive officers, a one-time limited right to include all or a portion of his
shares of our common stock in a registration statement otherwise being filed by
us to register the sale of our common stock under the Securities Act of 1933. We
have agreed to pay all the expenses of any such registration, other than
underwriting fees, discounts and commissions. In addition, we granted Mr. Hines
a one-time limited right to require us to register all or a portion of his
shares of common stock under the Securities Act of 1933. Mr. Hines has agreed to
pay all the expenses of such demand registration up to $200,000, and we have
agreed to pay all the expenses, other than underwriting fees, discounts and
commissions, in excess of $200,000. In consideration of the Allen Tank, Inc.
acquisition, Mr. Hines agreed that, during his initial term as a member of our
board of directors (which will expire in 2000), he will not, without our
consent, sell or dispose of any of his shares of our common stock except in a
registered offering in accordance with his registration rights or by gift to a
donee who agrees to be bound by the same restrictions.
In April, 1999, we acquired (i) all the capital stock of Oil Barges, Inc.
by means of a merger of it with one of our subsidiaries and (ii) substantially
all the assets of Southern Rentals, L.L.C. Philip J. Patout, who subsequently
became one of our executive officers, was a director and an executive officer of
Oil Barges, Inc. and a manager of Southern Rentals, L.L.C. and owned one-third
of the capital stock of Oil Barges, Inc. and one-third of the membership
interests in Southern Rentals, L.L.C.
Each shareholder of Oil Barges, Inc. received shares of our common stock
for his shares of Oil Barges, Inc. stock upon the merger, and each member of
Southern Rentals, L.L.C. received as a distribution on his Southern Rentals,
L.L.C. interests a pro rata portion of the shares of our common stock issued to
Southern Rentals, L.L.C. upon our purchase of substantially all of its assets.
To secure the indemnifications given us by the Oil Barges, Inc. shareholders,
Southern Rentals, L.L.C., and the Southern Rentals, L.L.C. members for any
breach of their respective representations, warranties, or agreements made in
connection with those acquisitions, 20% of the shares of our common stock
received by the Oil Barges, Inc. shareholders and the Southern Rentals members
are being held in escrow. In exchange for his Oil Barges, Inc. shares and as a
distribution on his Southern Rentals, L.L.C. interests, Mr. Patout received a
total of 263,251 shares of our common stock. We determined the consideration
that we paid for the outstanding shares of Oil Barges, Inc. and substantially
all the assets of Southern Rentals, L.L.C. with the shareholders of Oil Barges,
Inc. and the members of Southern Rentals, L.L.C. in arm's length negotiations.
Our company was paid approximately $771,000 for fabrication, installation,
repair, and maintenance services it provided in fiscal 2000 to Ridgelake Energy,
Inc. ("Ridgelake"). William A. Hines, one of our directors, is a director and an
executive officer of Ridgelake and owns directly approximately 27% of Ridgelake
common stock. Mr. Hines's daughter, Sydney Hines Pitre, owns directly
approximately 2%, and, indirectly through her three children, approximately an
additional 6%, of Ridgelake common stock. Benjamin R. Hines, a son of Mr. Hines,
owns directly approximately 2% of Ridgelake common stock. Mr. Hines's other son,
William M. Hines, is also a director and an executive officer of Ridgelake and
owns directly approximately 37%, and, indirectly through his three children,
approximately an additional 16%, of Ridgelake common stock.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Our compensation committee has the authority, among other things, to
review, to analyze, and to recommend compensation programs to our board of
directors and to administer and to grant awards under our employee benefit
plans. Two of our directors, Charles E. Broussard and George C. Yax, comprise
the compensation committee. Neither Mr. Broussard nor Mr. Yax is a present or
former officer of our company, and none of the members of the Compensation
Committee are employees of our company.
Our executive compensation consists primarily of (1) salaries, (2) annual
cash incentive bonuses and (3) long-term incentive compensation in the form of
stock options granted under our long-term incentive plan.
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The annual salary of Dailey J. Berard, our President and Chief Executive
Officer, is set at $180,000 in his employment agreement, which was negotiated
between our board of directors and Mr. Berard. The salaries of our other
executive officers are based on their levels of responsibility and the
subjective assessment of their performance.
The amount of the annual bonus, if any, payable to Dailey J. Berard is
determined in accordance with the terms of his employment agreement, which
provides that he will be entitled to receive, as an annual incentive bonus, a
percentage of his annual salary ranging from 50% to 100%, depending on the
percentage net income return on our capital. We must achieve a minimum 15% net
income return on capital for Mr. Berard to receive a minimum bonus of 50% of his
annual salary, and Mr. Berard may receive the maximum bonus of 100% of his
annual salary if we achieve a 30% or greater percentage net income return on
capital. We did not achieve a minimum 15% net income return on capital in fiscal
2000; accordingly, Mr. Berard was not paid a bonus for that year.
We have adopted an executive compensation program for our other executive
officers that ties a portion of executive compensation to our short-term
performance. Under this program, executive officers and other key employees are
entitled to receive, as an annual incentive bonus, a percentage of their
respective annual salary ranging from 35% to 70%, depending on the percentage
net income return on our capital. We must achieve a minimum 15% net income
return on our capital for any of them to receive a minimum bonus of 35% of
annual salary, and each of them may receive the maximum bonus of 70% of annual
salary if we achieve a 30% or greater percentage net income return on capital.
We did not achieve a minimum 15% net income return on capital in fiscal 2000;
accordingly, we did not pay a bonus for fiscal 2000 to any of our executive
officers. We have included the amounts of the incentive bonuses awarded to
certain executive officers in fiscal 1999 and 1998 in the "Summary Compensation
Table" under the heading "Executive Compensation."
We also provide long-term incentives to our executive officers in the form
of stock options granted under our long-term incentive plan. The stock option
awards are intended to reinforce the relationship between compensation and
increases in the market price of our common stock and to align our executive
officers' financial interests with that of our shareholders. We based the sizes
of awards to each of our executive officers in years prior to fiscal 2000 on the
position of each participating officer and a subjective assessment of each
participant's individual performance. No stock options were granted in fiscal
2000 to our executive officers. We have included the number of securities
underlying stock options granted to certain executive officers in fiscal 1999
and 1998 in the "Summary Compensation Table" under the heading "Executive
Compensation."
Section 162(m) of the Internal Revenue Code limits the tax deduction to $1
million for compensation paid to certain highly compensated executive officers.
Qualified performance-based compensation is excluded from this deduction
limitation if certain requirements are met. None of our executive officers
reached the deductibility limitation for fiscal 2000. Our compensation committee
believes that the stock options granted to our executive officers in prior
fiscal years, as discussed above, qualify for the exclusion from the deduction
limitation under Section 162(m). Our compensation committee anticipates that the
remaining components of individual executive compensation that do not qualify
for an exclusion from Section 162(m) should not exceed $1 million in any year
and therefore will continue to qualify for deductibility.
The Compensation Committee
Charles E. Broussard George C. Yax
8
<PAGE> 11
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on our
common stock from September 19, 1997, which is the date that our common stock
initially traded publicly, to March 31, 2000, with the cumulative total return
of the Standard & Poor's 500 Stock Index and the Standard & Poor's Oil & Gas
(Drilling & Equipment) Index for the same period. The returns are based on an
assumed investment of $100 on September 19, 1997 in our common stock and in each
of the indexes and on the assumption that dividends were reinvested. The assumed
$100.00 investment in our common stock is made at $32.00 per share, the closing
price on September 19, 1997, the first day of trading after the effective date
of our initial public offering. Our common stock was sold in the initial public
offering at $18.00 per share.
COMPARISON OF CUMULATIVE TOTAL RETURN*
UNIFAB INTERNATIONAL, INC., S&P 500 INDEX &
S&P OIL & GAS (DRILLING & EQUIPMENT) INDEX
[GRAPH]
<TABLE>
<CAPTION>
SEPTEMBER 19, 1997 MARCH 31, 1998 MARCH 31, 1999 MARCH 31, 2000
------------------ -------------- -------------- --------------
<S> <C> <C> <C> <C>
UNIFAB International, Inc. ........ $100.00 $ 54.69 $ 25.39 $ 25.00
S&P 500............................ 100.00 116.87 138.44 163.28
S&P Oil & Gas (Drilling &
Equipment) Index................. 100.00 94.56 73.15 98.40
</TABLE>
ASSUMES $100 INVESTED ON SEPTEMBER 19, 1997 IN UNIFAB INTERNATIONAL, INC. COMMON
STOCK, S&P 500 INDEX & S&P OIL & GAS (DRILLING & EQUIPMENT) INDEX
* TOTAL RETURN ASSUMES REINVESTMENT OF DIVIDENDS
<TABLE>
<S> <C> <C>
o UNIFAB International, Inc.
o S&P 500
o S&P Oil & Gas (Drilling &
Equipment) Index
</TABLE>
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RATIFICATION OF THE APPOINTMENT OF AUDITORS
Our board of directors seeks shareholder ratification of its appointment of
Ernst & Young LLP to act as the independent auditors of our financial statements
for fiscal 2001. Our board has not determined what, if any, action it would take
should the appointment of Ernst & Young LLP not be ratified. One or more
representatives of Ernst & Young LLP will be available at our 2000 annual
meeting to respond to appropriate questions, and those representatives will also
have an opportunity to make a statement.
By Order of the Board of Directors
Peter J. Roman
Secretary
New Iberia, Louisiana
August 11, 2000
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THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
UNIFAB INTERNATIONAL, INC.
The undersigned hereby constitutes and appoints Dailey J. Berard and
Peter J. Roman or either of them proxy for the undersigned, with full power of
substitution, to represent the undersigned and to vote, as designated on the
reverse side, all of the shares of Common Stock of UNIFAB International, Inc.
(the "Company") that the undersigned is entitled to vote held of record by the
undersigned on August 4, 2000, at the annual meeting of shareholders of the
Company to be held on September 14, 2000 (the "Annual Meeting"), and at all
adjournments thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR THE NOMINEES AND FOR THE PROPOSAL LISTED ON THE REVERSE SIDE. THE
INDIVIDUALS DESIGNATED ABOVE WILL VOTE IN THEIR DISCRETION ON ANY OTHER MATTER
THAT MAY PROPERLY COME BEFORE THE MEETING.
(PLEASE SEE REVERSE SIDE)
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UNIFAB INTERNATIONAL, INC.
Please Mark Vote in Oval in the Following Manner Using Dark Ink Only. [X]
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The Board of Directors recommends a vote FOR the nominees listed below and FOR Proposal 2.
FOR WITHHOLD
all nominees AUTHORITY
listed to the to vote for all
left (except as nominees listed
marked to the to the left
contrary below)
[ ] [ ] FOR AGAINST ABSTAIN
1. Election of the nominees 2. Ratification of appointment [ ] [ ] [ ]
for directors. of Ernst & Young LLP as
Nominees: Dailey J. Berard independent auditors.
William A. Hines
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE 3. In their discretion to vote upon such other
FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE business as may properly come before the
THROUGH THE NOMINEE'S NAME IN THE LIST ABOVE. Annual Meeting or any adjournment thereof.
PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED ENVELOPE.
-------------------------------------------, 2000
Signature of Shareholder Date
-------------------------------------------, 2000
Signature if held jointly Date
Note: Please sign exactly as name appears on the certificate
or certificates representing shares to be voted by this
proxy, as shown on the label above. When signing as
executor, administrator, attorney, trustee or guardian,
please give full title as such. If a corporation, please
sign full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name
by authorized persons.
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