SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. ___)
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Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of
the Commission Only (as
permitted by Rule 14a-
6(e)(2))
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[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Regency Realty Corporation
(Name of Registrant as Specified in its Charter)
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<PAGE>
TRAILER BRIDGE, INC.
NOTICE OF 1998 ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Trailer Bridge, Inc.:
The Annual Meeting of Stockholders of Trailer Bridge, Inc. a Delaware
corporation (the "Company"), will be held at the company's facility at
10405 New Berlin Road East, Jacksonville, Florida 32226 at 10:00 A.M.
Jacksonville time on Wednesday, May 20, 1998 for the following purposes:
(1) To elect four directors of the Company to hold office until the
next annual meeting of stockholders; and
(2) To approve the Employee Stock Purchase Plan recommended by the
directors; and
(3) To transact such other business as may properly be presented at
the Annual Meeting or any adjournment thereof.
A proxy statement with respect to the Annual Meeting accompanies and
forms a part of this Notice. The Company's Annual Report to Stockholders
for the fiscal year ended December 31, 1997 also accompanies this Notice.
The Board of Directors has fixed the close of business on March 31,
1997, as the record date for determining stockholders entitled to notice
of, and to vote at, the Annual Meeting and at any adjournments or
postponements thereof. Each holder of shares of the Company's Common Stock
is entitled to one (1) vote for each share of Common Stock held on the
record date.
By order of the Board of
Directors,
WILLIAM G. GOTIMER, JR.
Secretary and General Counsel
Jacksonville, Florida
April 23, 1998
PLEASE MARK, SIGN AND DATE THE ENCLOSED PROXY AND
RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE WHETHER
OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING.
<PAGE>
TRAILER BRIDGE, INC.
10405 NEW BERLIN ROAD EAST
JACKSONVILLE, FLORIDA 32226
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of Trailer Bridge, Inc., a Delaware corporation
(the "Company"), of proxies for use at the 1998 Annual Meeting of
Stockholders of the Company to be held on Wednesday, May 20, 1998, and any
adjournment thereof (the "Annual Meeting"). This Proxy Statement and
accompanying form of proxy are first being sent to stockholders on or
about April 23, 1998.
The Company's common stock, $.01 par value (the "Common Stock") is the
only issued and outstanding class of stock. Only stockholders of record
at the close of business on March 31, 1998 (the "Record Date"), are
entitled to notice of and to vote at the Annual Meeting. As of the Record
Date, the Company had 9,777,500 shares of Common Stock outstanding and
entitled to vote.
VOTING RIGHTS AND PROCEDURES
Shares represented by an effective proxy given by a stockholder will be
voted as directed by the stockholder. If a properly signed proxy form is
returned to the Company and is not marked, it will be voted in accordance
with the recommendation of the Board of Directors on all proposals. A
stockholder giving a proxy may revoke it at any time prior to the voting
of the proxy by giving written notice to the Secretary of the Company, by
executing a later dated proxy or by attending the Annual Meeting and
voting in person.
Each share of Common Stock is entitled to one (1) vote. The holders of
Shares having a majority of the votes which could be cast by the holders
of all Shares, present in person or represented by proxy, will constitute
a quorum at the Annual Meeting. Abstentions will be treated as Shares
that are present and entitled to vote for purposes of determining the
presence of a quorum, but as not present or represented at the Annual
Meeting for purposes of determining the approval of any matter submitted
to the stockholders for a vote. If a broker indicates on the proxy that
it does not have discretionary authority as to certain Shares to vote on a
particular matter, those Shares will not be considered as present and
entitled to vote with respect to that matter. M.P. McLean owns 5,338,000
shares of Common Stock. Consequently, M.P. McLean controls approximately
55% of the voting power of the Company on all matters presented for
stockholder action.
Directors are elected by a plurality of the votes present in person or
represented by proxy at the Annual Meeting and entitled to vote for the
election of directors, provided a quorum is present. Stockholders are not
allowed to cumulate their votes in the election of directors. Shares
represented at the Annual Meeting in person or by proxy but withheld or
otherwise not cast for the election of directors will have no effect on
the outcome of the election.
Votes cast by proxy or in person at the Annual Meeting will be
tabulated by the election inspectors appointed for the meeting and such
election inspectors will determine whether or not a quorum is present.
The Board of Directors knows of no matters to be presented at the
Annual Meeting other than those set forth in the Notice of 1998 Annual
Meeting of Stockholders enclosed herewith. However, if any other matters
do come before the meeting, it is intended that the holders of the proxies
will vote thereon in their discretion. Any such other matter will require
for its approval the affirmative vote of the holders of Common Stock
having a majority of the votes present in person or represented by proxy
at the Annual Meeting, provided a quorum is present, or such greater vote
as may be required under the Company's Certificate of Incorporation, the
Company's By-laws or applicable law. A list of stockholders as of the
record date will be available for inspection at the Annual Meeting and for
a period of ten days prior to the Annual Meeting at the Company's offices
in Jacksonville.
ELECTION OF DIRECTORS
The number of directors of the Company, as determined by the Board of
Directors under Article III of the Company's By-laws, is currently four.
Each director holds office until his or her successor is elected and
qualified or until his or her earlier death, resignation, retirement,
disqualification or removal.
The nominees for whom the enclosed proxy is intended to be voted are
set forth below. Each nominee for election as director currently serves
as a director of the Company. It is not contemplated that any of these
nominees will be unavailable for election, but if such a situation should
arise, the proxy will be voted in accordance with the best judgment of the
proxy holder for such person or persons as may be designated by the Board
of Directors unless the stockholder has directed otherwise.
Nominees for Election as Directors
<TABLE>
<CAPTION>
Name Age Business Experience During the Past Five Years and Other Information
---- --- --------------------------------------------------------------------
<S> <C> <C>
M.P. McLean 84 Mr. McLean, a director since April 1991,
is the founder and principal stockholder
of Trailer Bridge. His principal business
activity during the past five years has
related to developing Trailer Bridge. He
served as President from June 1991 to July
1992 and from January 1995 to November 1995.
Mr. McLean is a pioneer in transportation
who is responsible for a number of innovations
in both trucking and shipping and who is best
known as the founder of container shipping.
He built McLean Trucking Company into one of
the largest and most profitable trucking
companies in the U.S., where it was the first
major user of diesel engines in its tractors.
In the mid-1950's, he purchased two steamship
companies which were combined to form Sea-Land
Service, Inc. ("Sea-Land") which introduced
and developed container shipping. Following
the sale of Sea-Land in 1968, Mr. McLean went
on to found McLean Industries whose principal
subsidiary, U.S. Lines, became the largest
container shipping company in the world. His
business accomplishments led to his induction
in the Fortune Magazine Business Hall of Fame,
and he was referred to by a leading business
magazine as "one of the few men who changed
the world."
John D. McCown 43 Mr. McCown, a director since April 1991, has
served as the Chairman of the Board and Chief
Executive Officer since November 1995. From
July 1992 to November 1995, Mr. McCown was Vice
President of the Company. In addition to his
role at Trailer Bridge, he is President and Chief
Executive Officer of Kadampanattu Corp., an
affiliate of Trailer Bridge that owns two vessels
now utilized by Trailer Bridge in its present
Puerto Rico service. Mr. McCown has worked for
Malcom P. McLean in various capacities since
1980. Mr. McCown is a graduate of Harvard
Business School (MBA, 1980) and Louisiana State
University (BBA, 1975). Mr. McCown also serves
on the Audit Committee.
Kenneth G. Younger 72 Mr. Younger, a director since September 1997,
is the former Chairman and Chief Executive Officer
of Carolina Freight Corporation a position he
held from 1977 to 1990 and 1993-1994. Prior to
joining Carolina Freight Corporation, a large
less-than-truckload trucking concern in 1970,
Mr. Younger held various management positions
with Sea-Land Services. Mr. Younger also serves
on the board of directors of Kenan Transport,
Company Mr. Younger serves on both the Compensation
and Audit Committees.
Artis E. James 51 Mr. James, a director since September 1997, is
the President and Chief Executive Officer of
Purcell Co., Inc., a real estate development
company with properties in the southeastern U.S.
Mr. James has held that position since 1979.
Purcell Co., Inc. is a subsidiary of a company
where M.P. McLean is the majority stockholder.
Mr. James serves on both the Compensation and
Audit Committees.
</TABLE>
The Board of Directors recommends that the stockholders vote FOR the
election of each nominee for director named above. Because M.P. McLean,
the owner of approximately 55% of the outstanding Common Stock, intends to
vote for the election of each nominee for director named above, such
election is assured.
EXECUTIVE OFFICERS OF THE COMPANY
Executive officers of the Company serve at the will of the Board of
Directors. The executive officers of the Company are as follows:
NAME AGE POSITION
---- --- --------
John D. McCown . . . . . 43 Chairman of the Board and Chief
Executive Officer
Ralph W. Heim . . . . . . 51 President and Chief Operating
Officer
Wayne Hodges . . . . . . 48 Vice President of Sales
J. Edward Morley . . . . 50 Vice President of Operations
Mark A. Tanner . . . . . 46 Vice President of Administration
and Chief Financial Officer
Robert van Dijk . . . . . 51 Vice President of Pricing
William G. Gotimer, Jr . 38 Secretary and General Counsel
Mr. Heim has served as President since November 1995 and Chief
Operating Officer since January 1992. From May 1991 until November 1995,
Mr. Heim served as Vice President of the Company. Prior to joining Trailer
Bridge in 1991, Mr. Heim worked at Crowley Maritime Corporation for five
years in various operating capacities primarily related to its Puerto Rico
service. His other transportation experience includes more than 15 years
with Sea-Land, Puerto Rico Marine Management and U.S. Lines in diverse
domestic and international assignments. Mr. Heim graduated from
Jacksonville University with a B.S. in Business Management.
Mr. Hodges has served as Vice President of Sales since November 1995.
Prior to joining Trailer Bridge in September 1995, he served as General
Sales Manager for M.S. Carriers, a major nationwide truckload carrier
based in Memphis. Mr. Hodges was that company's first salesman, beginning
in 1982. Prior to his association with M.S. Carriers, Mr. Hodges' trucking
experience included terminal manager positions at Mistletoe Express and
United Parcel Service as well as a branch manager position at a trailer
sales dealer.
Mr. Morley has served as Vice President of Operations since July 1992
and is responsible for marine and terminal operations. Prior to joining
Trailer Bridge in 1991, Mr. Morley was with Sea-Land where he was
responsible for operations in Puerto Rico from 1990 to 1991. Mr. Morley's
overall transportation experience with major container transportation
companies spans over 25 years.
Mr. Tanner, a CPA, has served as Vice President of Administration and
Chief Financial Officer since January 1992. Mr. Tanner joined Trailer
Bridge in 1991 from Crowley Maritime where he was Manager of Analysis and
Statistics for four years. His prior experience includes three years as
Manager of Corporate Planning for The Charter Company, which was a
Jacksonville based $5 billion publicly-held company, and five years in
public accounting.
Mr. van Dijk has served as Vice President of Pricing since July 1992
and directs all pricing related activities. Prior to joining Trailer
Bridge in 1991, Mr. van Dijk worked for Crowley Maritime, where he
directed pricing for the Puerto Rico service. Mr. van Dijk's pricing
related experience includes over 30 years with American Transport, U.S.
Lines, Weyerhauser Shipping, Sea-Land and Holland America Lines.
Mr. Gotimer has served as General Counsel since 1991. Mr. Gotimer also
acts as legal counsel for Malcom P. McLean, including General Counsel for
Kadampanattu Corp. His previous experience includes legal counsel with
British Airways, Plc., Pan American World Airways and McLean Industries.
Mr. Gotimer has an LL.M. degree in Taxation from New York University
School of Law and both a JD and BS degree in accounting from St. John's
University.
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors has both an Audit Committee and a Compensation
Committee. The Board of Directors does not have a Nominating Committee.
During the fiscal year ended December 31, 1997, the Board of Directors met
once and the Audit and Compensation Committees met once. During 1997, all
directors attended 100% of the meetings of the Board of Directors and the
committees thereof on which they served.
The duties of the Audit Committee are to oversee the Company's internal
control structure; review the Company's financial statements and other
financial information to be included in the Company's 10-K and annual
report to stockholders; select the independent auditors for the Company;
and review the Company's annual audit plan. The members of the Audit
Committee are Messrs. McCown, Younger and James.
The duties of the Compensation Committee are to make recommendations to
the Board of Directors concerning the salaries of the Company's officers;
to exercise the authority of the Board of Directors concerning the
Company's 1997 Incentive Stock Plan; and to advise the Board of Directors
on other compensation and benefit matters. The members of the
Compensation Committee are Messrs. Younger and James.
OWNERSHIP OF THE CAPITAL STOCK OF THE COMPANY
The following table sets forth information with respect to the number
of shares of Common Stock beneficially owned by (i) each director of the
Company, (ii) the executive officers of the Company named in the table
under "Compensation of Directors and Executive Officers-- Summary
Compensation Table," (iii) all directors and executive officers of the
Company as a group, and (iv) based on information available to the Company
and a review of statements filed with the Commission pursuant to Section
13(d) and 13(g) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), each person that owns beneficially (directly or together
with affiliates) more than 5% of the Common Stock as of December 31, 1997,
except as otherwise noted. The Company believes that each individual or
entity named has sole investment and voting power with respect to shares
of the Common Stock indicated as beneficially owned by them, except as
otherwise noted.
Number (1)
Name Shares Percentage
---- ---------- ----------
Malcom P. McLean(4) . . . . . . . . . 5,338,000 55.6%
Clara L. McLean(4) . . . . . . . . . 1,334,500 13.6%
John D. McCown(1)(4) . . . . . . . . 1,335,700 13.6%
Ralph W. Heim(2) . . . . . . . . . . 140,375 1.4%
J. Edward Morley(2) . . . . . . . . . 51,025 .5%
Robert Van Dijk(2) . . . . . . . . . 51,025 .5%
Mark A. Tanner(2) . . . . . . . . . . 51,025 .5%
Wayne Hodges(2) . . . . . . . . . . . 51,225 .5%
Wanger Asset Management, L.P. and
Wanger Asset Management Ltd., (3) . 622,000 6.4%
All Directors and Executive Officers
As A Group. . . . . . . . . . . . . 5,734,900 58.7%
(1) Includes 1,334,500 shares subject to immediately exercisable options
granted by Malcom P. McLean to Mr. McCown in February 1994 and May
1997.
(2) Shares subject to options granted in July 1997 under the Company's
Incentive Stock Plan which become exercisable 20% per year beginning
on the first anniversary of the grant.
(3) Wanger Asset Management, L.P. ("WAM") and Wanger Asset Management
Ltd., the general partner of WAM ("WAM Ltd.") filed a Schedule 13G
with the Commission indicating beneficial ownership of 622,000 shares
of Common Stock. According to the Schedule 13G, WAM and WAM Ltd.
each have shared dispositive power with respect to all 622,000 shares
of Common Stock beneficially owned. The number of shares beneficially
owned by WAM and WAM Ltd. is indicated as of December 31, 1997. The
address of WAM and WAM Ltd. is 227 West Monroe Street, Suite 3000,
Chicago, Illinois 60606.
(4) The address of each individual is 660 Madison Avenue, 10th Floor, New
York, New York 10021.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's directors
and executive officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file with the
Commission initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the Company.
Officers, directors, and greater than ten-percent stockholders are
required by Commission regulation to furnish the Company with copies of
all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no
other reports were required, during the Company's 1997 fiscal year all
applicable Section 16(a) filing requirements were complied with by the
officers, directors, and greater than ten-percent beneficial owners.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Summary Compensation Table
The following table sets forth a summary of the annual, long-term,
and other compensation for services rendered to the Company for the fiscal
years ended December 31, 1996 and December 31, 1997 paid or awarded to
those persons who were, at December 31, 1997: (i) the Company's chief
executive officer, and (ii) the Company's five most highly compensated
executive officers other than the chief executive officer (collectively,
including the Company's chief executive officer, the "Named Executive
Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
---------------------------------------------------------------- ------------
Other Annual Options/ All Other
Name and Salary Bonus Compensation SARs Compensation
Principal Position Year ($) ($) ($) (#) ($)(2)
------------------ ---- ------ ----- ------------ -------- ------------
<S> <C> <C> <C> <C> <C> <C>
John D. McCown(3) 1997 260,443 64,231 -- -- 8,529,096(1)
Chairman of the Board 1996 235,864 37,311 -- -- --
and CEO
Ralph W. Heim 1997 165,000 110,945 -- 137,375 6,113
President and 1996 154,904 64,446 -- -- 6,113
Chief Operating
Officer
J. Edward Morley 1997 112,070 64,231 -- 51,025 3,390
Vice President of 1996 112,405 37,311 -- -- 3,950
Operations
Robert van Dijk 1997 108,724 64,231 -- 51,025 4,417
Vice President of 1996 108,724 37,311 -- -- 4,488
Pricing
Mark A. Tanner 1997 108,000 64,231 -- 51,025 4,008
Vice President of 1996 104,635 37,311 -- -- 3,978
Administration & CFO
Wayne Hodges 1997 107,763 64,231 -- 51,025 4,056
Vice President of 1996 104,183 37,311 -- -- 3,707
Sales
</TABLE>
(1) Representing the difference between the exercise price and the
initial public offering price on shares granted by the majority
stockholder of the Company. In connection with this option, the
Company recorded a non-recurring, non-cash charge for compensation
expense and a credit to paid in capital in the same amount. This
option does not involve the issuance of additional shares of Common
Stock and therefore any subsequent purchase of shares under the
option will not have a dilutive effect on the Company's book value or
earnings per share amounts.
(2) Represents the Company's matching contribution to the Company's
Section 401(k) deferred compensation plan and excess group life
insurance premiums respectively, as follows: In 1996 Mr. Heim, $4,500
and $1,613; Mr. Morley, $3,344 and $606; Mr. van Dijk, $3,523 and
$965; Mr. Tanner, $3,400 and $578; and Mr. Hodges, $3,125 and $582.
In 1997 Mr. McCown, $0 and $425; Mr. Heim, $4,500 and $1,613; Mr.
Morley, $3,120 and $270; Mr. van Dijk, $3,452 and $964; Mr. Tanner,
$3,431 and $578; and Mr. Hodges, $3,451 and $605.
(3) In 1996 and in 1997 until the closing of the Company's public
offering, Mr. McCown provided services to the Company in connection
with the Company's vessel charter from its affiliate, Kadampanattu
Corp. The amount shown as salary on the above table for 1996 was paid
by the affiliate. Commencing with the closing of the initial public
offering, Mr. McCown's compensation has been paid directly by the
Company and the Company's charter payments were reduced in a
corresponding amount.
Option/SAR Grants In Last Fiscal Year
The following table summarizes the grants of stock options awarded to
the Named Executive Officers during the fiscal year ended December 31,
1997, under the Company's Incentive Stock Plan.
<TABLE>
<CAPTION>
Individual Grants(1)
-----------------------------------------------------
% of Potential Realizable Value at Assumed
Options/ Total Annual Rates of Stock Price
SAR Options/ Appreciation for Option Term (4)
Granted SARs Exercise Expiration -------------------------------------
Name (#) Granted Price ($/sh)(2) Date(3) 5%($) 10%($)
---- -------- -------- --------------- ---------- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Ralph W. Heim . . . 137,375 29.2% 10.00 07/22/07 863,944 2,189,404
J. Edward Morley . 51,025 10.8% 10.00 07/22/07 320,894 813,207
Robert van Dijk . . 51,025 10.8% 10.00 07/22/07 320,894 813,207
Mark A. Tanner . . 51,025 10.8% 10.00 07/22/07 320,894 813,207
Wayne Hodges . . . 51,025 10.8% 10.00 07/22/07 320,894 813,207
</TABLE>
(1) An immediately exercisable option was granted by Malcom P. McLean to
Mr. McCown in May 1997 covering 942,000 shares with an exercise price
of $.95 per share. A compensation charge of $8,528,670 has been
entered by the Company and included in the Summary Compensation Table
under Other Annual Compensation. The option has a term of ten years.
(2) The exercise price equals the initial public offering price of the
Common Stock.
(3) The options were granted on July 22, 1997 and vest ratably over a
five-year period, expiring ten years after their grant date.
(4) The potential realizable dollar value of a grant is the product of:
(a) the difference between (i) the product of the per-share market
price at the time of the grant and the sum of 1 plus the stock
appreciation rate compounded annually over the term of the option
(here, 5% and 10%), and (ii) the per-share exercise price of the
option, and (b) the number of securities underlying the grant at
fiscal year-end.
Aggregated Option/SAR Exercises In Last Fiscal Year and Fiscal Year-End
Option/SAR Values
The following table provides information concerning options exercised
by the Named Executive Officers during the fiscal year ended December 31,
1997, and the value at December 31, 1997, of unexercised options under the
Company's Incentive Stock Plan.
<TABLE>
<CAPTION>
Number of Value ($) of
Unexercised Unexercised In-the-
Shares Options at Money Options at
Acquired December 31, 1997 December 31, 1997
on ----------------- -----------------
Exercise Value Exercisable/ Exercisable/
Name (#) Realized ($) Unexercisable Unexercisable
---- -------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Ralph W. Heim 0 0 0 / 137,375 0 / 0
J. Edward Morley 0 0 0 / 51,025 0 / 0
Robert van Dijk 0 0 0 / 51,025 0 / 0
Mark A. Tanner 0 0 0 / 51,025 0 / 0
Wayne Hodges 0 0 0 / 51,025 0 / 0
</TABLE>
Compensation of Directors
Directors who are not employees of the Company receive an annual
retainer of $5,000 and $1,000 for each meeting of the Board of Directors
or committee of the Board of Directors attended by such director (if such
committee meeting is held other than on the day of a Board meeting), plus
reimbursement of expenses incurred in attending such meetings. Directors
who are employees of the Company do not receive additional compensation
for such services.
Compensation Committee Interlocks And Insider Participation
The Company's Compensation Committee established after the completion
of the Company's initial public offering is comprised of the Company's
two independent directors. Prior to the offering, Malcom P. McLean and
John D. McCown made all decisions concerning executive officer
compensation. Mr. McLean is the sole stockholder and Mr. McCown is the
President and Chief Executive Officer of Kadampanattu Corp., which
charters two vessels currently used by the Company. See "Certain
Transactions."
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee approves the policies under which
compensation is paid or awarded to the Company's executive officers. The
Compensation Committee consists of the two independent members of the
Board. The 1997 compensation structure was already determined when the
Compensation Committee assumed its responsibilities in September, 1997.
Prior to the offering, M.P. McLean and John D. McCown made all decisions
concerning executive office compensation
Board of Directors Compensation Committee Philosophy & Description of
Compensation Programs
The Company's compensation philosophy is designed to link executive
performance to long-term stockholder value, connect pay with individual
performance, maintain a compensation system that is competitive with the
industry standards and attract and retain outstanding executives.
The Company's executive compensation program has three components--base
salary, annual incentives, and incentive stock plan options. Base salary
and annual incentives are primarily designed to reward current and past
performance. Long-term incentives are primarily designed to provide
strong incentives for long-term future Company growth.
In reviewing base salaries of senior management for 1997 and salary
compensation for 1998, including the salary of Mr. John D. McCown, the
Company's Chief Executive Officer, the Compensation Committee reviewed and
considered (i) compensation information disclosed by similarly-sized
publicly held transportation companies; (ii) the financial performance of
the Company, as well as the role and contribution of the particular
executive with respect to such performance and (iii) non-financial
performance related to the individual executive's contributions.
Base Salary: To attract and retain qualified executives, base salary is
determined using competitive criteria within the transportation industry.
Salary increases are based on individual performance and, to a lesser
extent, trends within the industry.
Annual Incentive: The Company's bonus plan recognizes and rewards
executives for taking actions that build the value of the Company,
generate competitive total returns for stockholders, and provide value-
added solutions for the Company's customers. Bonus compensation is based
upon a point system that allocates an overall bonus based upon Company
performance. The allocation of points under this system is based upon the
subjective decision of the compensation committee.
Incentive Stock Plan Options: The Company's Incentive Stock Plan
Options serve to reward executive performance that successfully executes
the Company's long-term business strategy and builds stockholder value.
During fiscal year 1997, stock options were granted to the Company's
executive officers at the time of the Offering. The grants were designed
to motivate each executive officer to continue the Company's growth.
COMPENSATION COMMITTEE
Artis E. James
Kenneth G. Younger
Compensation Administration
The Compensation Committee will follow an annual cycle to administer
each of the three components of executive compensation. The integrity of
the Company's compensation program relies on an annual performance
evaluation process.
Performance Graph
The following line graph compares the Company's cumulative total
stockholder return on its Common Stock since July 29, 1997, the date that
the Common Stock began trading, with the cumulative total return of the
Nasdaq US Index and the S & P Truckers Index. These comparisons assume the
investment of $100 on July 29, 1997 in each index and in the Company's
Common Stock and the reinvestment of dividends. The graph assumes that
$100 of the Company's common stock was purchased on July 29, 1997, at the
initial public offering price of $10.00 per share. The Company has
paid no dividends since its inception. There is no assurance that the
Company's stock performance will continue into the future with the same
or similar trends depicted in the graph below. The Company makes no
predictions as to the future performance of its stock
COMPARISON OF CUMULATIVE TOTAL RETURN
[GRAPH APPEARS HERE]
7/29/97 12/31/97
Trailer Bridge, Inc.(1) 100 88.75
Nasdaq US Index 100 99.18
S&P Truckers Index 100 111.47
(the "Peer Group")
(1) Based on the Company's initial public offering price of $10.00 per
share.
CERTAIN TRANSACTIONS
The Company charters two roll-on/roll-off barge vessels and the right
to use related ramp structures in Jacksonville, Florida and San Juan,
Puerto Rico from Kadampanattu Corp. ("K Corp"), which is wholly owned by
Malcom P. McLean, the Company's founder, controlling stockholder and a
director. The charters currently provide for a per vessel payment to K
Corp of $10,050 per day and also require the Company to maintain and
repair the vessels and ramps. The charters expire at the later of
September 1, 2010 or the repayment of all obligations under K Corp's
construction loan for the 1996 mid-body expansion program. Such
obligations are scheduled to be repaid in quarterly installments ending
June 30, 2003. Upon the expiration of the charters, the Company has the
option to extend the charters for an additional eight years at $11,000 per
day per vessel, or may purchase the vessels at their then fair market
value. Total expense under these charters from K Corp was $3.6 million,
$5.9 million and $7.5 million in 1995, 1996 and 1997, respectively. The
charter payments were increased from $5,000 per day per vessel in 1996
following completion of the mid-body expansion. In the opinion of the
Board of Directors, the terms of the charters are at least as favorable as
those that could be obtained from unaffiliated third parties.
The Company will continue a policy that any transactions with
affiliated persons or entities will be on terms no less favorable to the
Company than those that could have been obtained on an arms-length basis
from unaffiliated third parties. Any such future transactions must also be
approved by a majority of the disinterested directors.
2. PROPOSAL TO ADOPT THE EMPLOYEE
STOCK PURCHASE PLAN
At the Meeting, the stockholders will be asked to approve a plan under
Section 423 of the Internal Revenue Code of 1986 to allow employees to
purchase shares of the Company's Common Stock at 85% of market value
through the use of payroll deductions (the "Employee Stock Purchase
Plan"). Under the terms of the plan eligible employees, those that are
full time employees of the Company and its affiliates, may direct up to
10% of base salary to the plan for use each six months to purchase shares
of Common Stock of the Company at 85% of the then market price. Adoption
of the Employee Stock Purchase Plan requires the affirmative vote of a
majority of the votes cast on the proposal in person or by proxy at the
Meeting.
Purpose of the Employee Stock Purchase Plan. The Employee Stock
Purchase Plan is intended to promote an increased proprietary interest in
the Company by employees, thereby aligning their interests more closely
with the interests of stockholders generally.
Shares to be Purchased Under the Employee Stock Purchase Plan. Each
eligible employee may, by election, designate a percentage, not to exceed
10%, of his or her base salary to be directed to the plan. Each six
months, the number of shares credited to the account of each participant
employee will equal the number of shares which could have been purchased
on that date in the open market at 85% of the market price. The Plan will
purchase such shares on the open market. The aggregate number of shares of
Common Stock that may be purchased under the Employee Stock Purchase Plan
may not exceed 150,000, subject to any adjustment due to recapitalization
or reorganization of the Company.
Termination and Amendment. The Board at any time may amend or
terminate the Employee Stock Purchase Plan.
The Board of Directors recommends that the stockholders vote FOR the
approval of the Employee Stock Purchase Plan. Because M.P. McLean, the
owner of approximately 55% of the outstanding Common Stock, intends to
vote in the affirmative, the approval of such plan is assured.
AUDITORS
The Board of Directors has selected Deloitte & Touche LLP as the
independent accountant of the Company. Representatives of Deloitte &
Touche LLP will be present at the Annual Meeting and will be given the
opportunity to make a statement if they desire to do so. They will also be
available to respond to appropriate questions.
PROXY SOLICITATION EXPENSE
The expense of proxy solicitation will be paid by the Company. In
addition to the solicitation of proxies by use of the mails, solicitation
also may be made by telephone, telegraph or personal interview by
directors, officers, and regular employees of the Company, none of whom
will receive additional compensation for any such solicitation. The
Company will, upon request, reimburse brokers, banks, and similar
organizations for out-of-pocket and reasonable clerical expenses incurred
in forwarding proxy material to their principals.
STOCKHOLDER PROPOSALS
Proposals of stockholders must be received in writing by the Secretary
of the Company at the principal executive offices of the Company no later
than December 26, 1998, in order to be considered for inclusion in the
Company's proxy statement and form of proxy relating to the next annual
meeting of stockholders.
OTHER MATTERS
The Board of Directors does not intend to present at the Annual Meeting
any matters other than those described herein and does not presently know
of any matters that will be presented by other parties. If any other
matters properly come before the Annual Meeting, it is intended that the
accompanying proxy may be voted on such matters in accordance with the
views of management.
Each stockholder, whether or not he or she expects to be present in
person at the Annual Meeting, is requested to MARK, SIGN, DATE, and RETURN
THE ENCLOSED PROXY in the accompanying envelope as promptly as possible.
A stockholder may revoke his or her proxy at any time prior to voting.
By order of the Board of
Directors,
WILLIAM G. GOTIMER, JR.
Secretary and General Counsel
Jacksonville, Florida
April 23, 1998
<PAGE>
DETACH HERE
PROXY
TRAILER BRIDGE, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned, revoking all previous proxies, hereby appoints JOHN
D. McCOWN and WILLIAM G. GOTIMER, JR., and each of them, proxies with
power of substitution to each, to vote and act at the annual meeting of
common shareholders of TRAILER BRIDGE, INC. to be held at the office of
the Company, 10405 New Berlin Road East, Jacksonville, Florida 32226, on
Wednesday, May 20, 1998 at 10:00 A.M., and at any adjournment thereof, on
and with respect to the Common Stock of the undersigned, or on and with
respect to which the undersigned is entitled to vote or act.
IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH
OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING, AND AT ANY
ADJOURNMENT THEREOF.
IMPORTANT- TO BE SIGNED AND DATED ON THE REVERSE SIDE
<PAGE>
[X] Please mark
votes as in
this example.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATIONS MADE HEREON. IF NO SPECIFICATION IS MADE, THIS PROXY WILL
BE VOTED FOR ITEMS 1 AND 2.
<TABLE>
<S> <C>
1. To elect four Directors: 2. To approve the Company's
Employee Stock Purchase
Nominees: Artis E. James, John D. McCown, Plan
Malcom P. McLean and
Kenneth G. Younger FOR AGAINST ABSTAIN
[ ] [ ] [ ]
FOR WITHHELD
[ ] [ ]
[ ] ______________________________________
For all nominees except as noted above
MARK HERE FOR ADDRESS CHANGE AND [ ]
NOTE AT LEFT
Please sign your name(s) exactly
as it appears hereon. If signing
as attorney or for estates, trusts
or corporations, title or capacity
should be indicated. PLEASE RETURN
THIS PROXY PROMPTLY.
Signature:__________ Date:________ Signature:____________ Date:_________
</TABLE>
