<PAGE> 1
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:
/ / Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
TEAM, 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/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(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):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
/ / 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:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
TEAM, INC.
1001 FANNIN ST., SUITE 4656
HOUSTON, TEXAS 77002
(713) 659-3600
NOTICE OF 1995 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON NOVEMBER 1, 1995
To the Shareholders of Team, Inc.:
The 1995 Annual Meeting of Shareholders of Team, Inc. (the "Company") will
be held on Wednesday, November 1, 1995 at 3:00 p.m. Houston time, at The Wyndham
Warwick, The Presidential Suite, 5701 Main Street, Houston, Texas for the
following purposes:
1. To elect two persons to serve as Class III Directors for a term of
three years on the Company's Board of Directors consisting of three classes
of directors with staggered terms;
2. To consider and vote on a proposal to approve the appointment of
Deloitte & Touche as the independent certified public accountants to audit
the Company's accounts for the fiscal year ending May 31, 1996; and
3. To transact such other business as may properly come before the
meeting and all adjournments thereof.
The Board of Directors has fixed the close of business on September 15,
1995 as the record date for determination of shareholders who are entitled to
notice of and to vote either in person or by proxy at the Annual Meeting of
Shareholders and any adjournment thereof.
All shareholders are cordially invited to attend the meeting in person.
Even if you plan to attend the meeting, YOU ARE REQUESTED TO SIGN, DATE AND
RETURN THE ACCOMPANYING PROXY AS SOON AS POSSIBLE.
By Order of the Board of Directors
William A. Ryan
Chairman of the Board of Directors,
President and Chief Executive Officer
September 26, 1995
YOUR VOTE IS IMPORTANT.
PLEASE SIGN, DATE AND RETURN THE ACCOMPANYING PROXY CARD PROMPTLY.
<PAGE> 3
TEAM, INC.
1001 FANNIN ST., SUITE 4656
HOUSTON, TEXAS 77002
(713) 659-3600
PROXY STATEMENT
GENERAL
This Proxy Statement and the accompanying proxy card are furnished in
connection with the solicitation of proxies by the Board of Directors of Team,
Inc., a Texas corporation (the "Company"), to be voted at the 1995 Annual
Meeting of Shareholders (the "1995 Annual Meeting"), and at any adjournment
thereof, to be held at the time and place and for the purposes set forth in the
accompanying Notice. This Proxy Statement and enclosed form of proxy is being
mailed to shareholders beginning on or about September 26, 1995.
The Company will bear costs of soliciting proxies in the accompanying form.
In addition to the solicitation made hereby, proxies may also be solicited by
telephone, telegram or personal interview by officers and employees of the
Company. The Company will reimburse brokers or other persons holding stock in
their names or in the names of their nominees for their reasonable expenses in
forwarding proxy material to beneficial owners of stock.
All duly executed proxies received prior to the 1995 Annual Meeting will be
voted in accordance with the choices specified thereon, unless revoked as
described below. As to any matter for which no choice has been specified in a
proxy, the shares represented thereby will be voted by the persons named in the
proxy: (1) FOR the election of the two nominees listed herein as Class III
Directors for a term of three years; (2) FOR the proposal to approve the
appointment of Deloitte & Touche as independent certified public accountants of
the Company for the fiscal year ending May 31, 1996; and (3) in the discretion
of such person in connection with any other business that may properly come
before the meeting. Shareholders may revoke their proxy at any time prior to the
exercise thereof by written notice to Mr. William A. Ryan of the Company at the
above address of the Company, by the execution and delivery of a later dated
proxy or by attendance at the meeting and voting their shares in person. Proxy
cards that are not signed or that are not returned are treated as not voted for
any purposes.
VOTING SECURITIES
As of the close of business on September 15, 1995, the record date for
determining shareholders entitled to vote at the 1995 Annual Meeting, the
Company had outstanding and entitled to vote 5,159,842 shares of common stock.
Each share of common stock is entitled to one vote with respect to each matter
to be acted upon at the meeting. The holders of a majority of the total shares
of common stock of the Company issued and outstanding as of September 15, 1995,
whether present in person or represented by proxy, will constitute a quorum for
the transaction of business at the meeting. Abstentions, or with respect to the
election of directors withholds, are counted for purposes of determining the
presence or absence of a quorum for the transaction of business while broker
non-votes are not so counted. Additionally, abstentions and/or withholds are
counted in tabulations of the votes cast on proposals presented to shareholders
whereas broker non-votes are not counted for purposes of determining whether a
proposal has been approved.
<PAGE> 4
PROPOSAL ONE -- ELECTION OF DIRECTORS
GENERAL
The Company's Restated Articles of Incorporation and Bylaws provide that
the Company's Board of Directors will consist of not less than six nor more than
nine persons, the exact number to be fixed from time-to-time by the Board of
Directors. The Board of Directors has fixed the number of directors constituting
the Board of Directors at seven, divided into three classes with staggered
three-year terms.
The Board of Directors has nominated two Class III Directors to be elected
to serve a three-year term expiring on the date of the Annual Meeting of
Shareholders of the Company to be held in 1998, and to hold office until their
successors are duly elected and qualified. Mr. Sidney B. Williams has been
nominated by the Board of Directors to stand for reelection as a Class III
Director for a three-year term and Mr. George W. Harrison has been nominated by
the Board of Directors to stand for election as a Class III Director for a
three-year term.
Directors are elected by a plurality of votes cast at the Annual Meeting.
Unless contrary instructions are set forth in the proxies, the persons with full
power of attorney to act as proxies at the 1995 Annual Meeting will vote all
shares represented by such proxies for the election of the nominees named
therein as directors. Should any of the nominees become unable or unwilling to
accept nomination or election, it is intended that the persons acting under the
proxy will vote for the election, in the nominee's stead, of such other persons
as the Board of Directors of the Company may recommend. The management has no
reason to believe that either of the nominees will be unable or unwilling to
stand for election or to serve if elected.
NOMINEES
Set forth below is certain information as of September 15, 1995 concerning
the nominees for election as Class III Directors at the 1995 Annual Meeting,
including the business experience of each for at least the past five years:
<TABLE>
<CAPTION>
PRESENT POSITION DIRECTOR
NAME AGE WITH THE COMPANY SINCE
- ------------------------------------------ --- --------------------- ----
<S> <C> <C> <C>
Mr. Sidney B. Williams.................... 62 Director 1973
Mr. George W. Harrison.................... 68 Senior Vice President --
</TABLE>
Mr. Williams is a sole shareholder of a professional corporation which is a
partner in the law firm of Chamberlain, Hrdlicka, White, Williams & Martin in
Houston, Texas and has been a partner in that firm for more than the past five
years.
Mr. Harrison joined the Company in 1974 as Vice President and assumed his
position as Senior Vice President in 1987. He is involved in most aspects of the
Company, including primarily, operations, engineering, marketing and the
research and development functions of the Company.
Mr. Williams and Mr. E. Theodore Laborde, a Class II Director of the
Company, are brothers-in-law.
2
<PAGE> 5
DIRECTORS CONTINUING IN OFFICE
Set forth below is certain information concerning the five directors
continuing in office until the expiration of their respective terms, including
the business experience of each for at least the past five years:
<TABLE>
<CAPTION>
EXPIRATION
OF
PRESENT POSITION DIRECTOR PRESENT
NAME AGE WITH THE COMPANY SINCE TERM
---- --- ---------------- ------ ----
<S> <C> <C> <C> <C>
William A. Ryan.......... 68 Chairman of the Board of Directors, 1987 1996
President and Chief Executive Officer
John L. Farrell, Jr...... 66 Director 1991 1996
Jack M. Johnson, Jr...... 57 Director 1992 1997
E. Theodore Laborde...... 57 Director 1991 1997
Thomas N. Amonett........ 51 Director 1994 1997
</TABLE>
Mr. Ryan was elected Chairman of the Board of Directors, President and
Chief Executive Officer of the Company in August of 1995. Previously Mr. Ryan
was President and Chief Operating Officer of Continental Materials Corporation
in Chicago, Illinois, from 1974 until his retirement in August 1995. Mr. Ryan
continues to serve as a Director of Continental Materials Corporation.
Continental Materials Corporation engages in the business of manufacturing
heating and cooling equipment and producing minerals and mineral products, and
its common stock is listed on the American Stock Exchange.
Mr. Farrell has been a principal in The Morgan Investment Group, a
consulting firm located in Tulsa, Oklahoma, since January 1988. The Morgan
Investment Group invests in and provides advisory services to privately held
companies. Mr. Farrell has acted as the Chairman of the Executive Committee of
Diagnetics, Inc. since January, 1990, and Chief Financial Officer from June 1994
to the present date. Diagnetics, Inc. is a privately held electronic
instrumentation and equipment manufacturer.
Mr. Johnson has been Managing General Partner of Wintermann & Company, a
general partnership that owns approximately 25,000 acres of real estate in Texas
which is used in farming, ranching and oil and gas exploration activities, for
more than the past five years. Mr. Johnson is also President of Winco
Agriproducts, an agricultural products company that primarily processes rice for
seed and commercial sale, and is on the Board of Directors of Houston National
Bank located in Houston, Texas with assets of approximately $100 million. Mr.
Johnson is also a Director of Security State Bank in Anahuac, Texas.
Mr. Laborde has served in various capacities with Marsh & McLennan, Inc.,
an insurance brokerage firm, in New Orleans, Louisiana, for approximately 32
years. Since 1982, Mr. Laborde has acted as Managing Director of the New Orleans
operation. Marsh & McLennan, Inc. is a subsidiary of Marsh & McLennan Companies.
Mr. Amonett is President, Chief Executive Officer and Director of Reunion
Resources Company, an oil and gas company located in Houston, Texas, and has
served in these positions since July 1992. Prior thereto, Mr. Amonett practiced
law with the firm of Fulbright & Jaworski where he was of counsel for more than
five years. From 1982 through 1986 he served as President and Director of
Houston Oil Fields Company, a Houston-based oil and gas exploration and
production company. Mr. Amonett serves as a Director of PetroCorp, Incorporated,
an oil and gas company, and Weatherford International Incorporated, an oil field
service company. Weatherford International Incorporated's common stock is listed
on the New York Stock Exchange. Reunion Resources Company and PetroCorp,
Incorporated are both listed on NASDAQ.
3
<PAGE> 6
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors held 11 meetings during the fiscal year ended May
31, 1995. No director attended fewer than 75% of the meetings held by the Board
and the Committees on which he served.
The Board of Directors has an Executive Committee, an Audit Committee and a
Compensation Committee but does not have a Nominating Committee. The Executive
Committee was composed of Messrs. Hall and Williams during fiscal 1995 and
presently is composed of Messrs. Ryan, Williams and Amonett. The Executive
Committee is responsible for assisting with the general management of the
business and affairs of the Company during intervals between meetings of the
Board of Directors. The Executive Committee met one time during fiscal 1995.
The Audit Committee was composed of Messrs. Amonett, Laborde and Ryan
during fiscal 1995 and is presently composed of Messrs. Amonett and Laborde. The
Audit Committee is charged with the duties of recommending the appointment of
the independent certified public accountants; reviewing their fees; ensuring
that proper guidelines are established for the dissemination of financial
information to the Company's shareholders; meeting periodically with the
independent certified public accountants, the Board of Directors and certain
officers of the Company and its subsidiaries to ensure the adequacy of internal
controls and reporting; reviewing consolidated financial statements; and
performing any other duties or functions deemed appropriate by the Board. The
Audit Committee met two times during fiscal 1995.
The Compensation Committee, composed of Messrs. Johnson, Farrell and
Williams both during fiscal 1995 and currently, reviews management performance
and makes recommendations to the Board of Directors concerning management
compensation and other corporate benefits. The Compensation Committee met two
times during fiscal 1995.
COMPENSATION OF DIRECTORS
All outside directors currently receive an annual fee of $10,000, payable
semi-annually, as well as $1,000 plus reasonable travel expenses for each Board
meeting, except as set forth below. Directors are not paid for telephone
meetings. Directors who are officers or employees of the Company are not paid an
annual fee, but otherwise are paid commensurate with the outside directors. No
fees are paid for attendance at Committee meetings.
In December 1991, the Company adopted the Non-Employee Directors' Stock
Option Plan, as amended in November 1993 and November 1994 (the "Non-Employee
Director Plan"), which authorizes options to purchase 205,000 shares of common
stock for directors of the Company who are not employees of the Company or any
of its affiliates. The purpose of the Non-Employee Director Plan is to attract
and to retain the services of experienced and knowledgeable independent
individuals as directors, to extend to them the opportunity to acquire a
proprietary interest in the Company so that they will apply their best efforts
for the benefit of the Company, and to provide such individuals with an
additional incentive to continue in their position. Pursuant to the Non-Employee
Director Plan, each non-employee director receives automatic grants of options
upon such director's appointment, reappointment, election or reelection to the
Board of Directors equal to the product obtained by multiplying five thousand
(5,000) by a number of years, or any part of any year, that such director is
appointed or elected to serve on the Board of Directors. The exercise price of
the options is equal to the fair market value of the Company's common stock on
the date of grant, and the options expire ten years after the date of grant.
Options to purchase 5,000 shares vest on the date of grant and each anniversary
thereafter until all of the options granted are fully vested. Currently under
the Non-Employee Director Plan, one director has been granted options to
purchase 15,000 shares at $3.00 per share, one director
4
<PAGE> 7
has been granted options to purchase 10,000 shares at $6.1875 per share and
15,000 shares at $3.00 per share, one director has been granted options to
purchase 15,000 shares at $6.4375 per share and 15,000 shares at $4.25 per
share, one director has been granted options to purchase 15,000 shares at
$6.4375 per share and 15,000 options at $3.00 per share, one director has been
granted options to purchase 25,000 shares at $6.4375 per share and 15,000 shares
at $4.25 per share, and one director has been granted options to purchase 50,000
shares at $6.4375 per share and 15,000 shares at $6.1875 per share. None of the
Company's directors exercised their options under the Non-Employee Director Plan
during the preceding fiscal year.
CURRENT DIRECTORS AND EXECUTIVE AND OTHER OFFICERS
The following table sets forth information regarding the current directors
and executive and other officers of the Company:
<TABLE>
<CAPTION>
YEAR YEAR
ELECTED ELECTED
NAME OF AS AS
DIRECTOR OR OFFICER AGE DIRECTOR OFFICER POSITION WITH COMPANY
- ---------------------------- --- ---- ---- ------------------------------------
<S> <C> <C> <C> <C>
William A. Ryan(1).......... 68 1987 1995 Chairman of the Board of Directors,
President and Chief Executive
Officer
George W. Harrison.......... 68 -- 1974 Senior Vice President
John M. Slack............... 47 -- 1994 Vice President, Chief Financial
Officer and Treasurer
Valerie L. Banner........... 40 -- 1990 Vice President, General Counsel and
Secretary
Sidney B. Williams(1)(3).... 62 1973 -- Director
E. Theodore Laborde(2)...... 57 1991 -- Director
John L. Farrell, Jr.(3)..... 66 1991 -- Director
Jack M. Johnson, Jr.(3)..... 57 1992 -- Director
Thomas N. Amonett(1)(2)..... 51 1994 -- Director
H. Wesley Hall.............. 56 1977 -- Director
</TABLE>
- ---------------
(1) Member of the Executive Committee
(2) Member of the Audit Committee
(3) Member of the Compensation Committee
Mr. Slack joined the Company in 1994 as Chief Financial Officer of the
Company and shortly thereafter was elected as Vice President. Mr. Slack was
elected Treasurer of the Company in March 1995. Previously, from 1986 to 1994,
Mr. Slack served as Vice President -- Finance and Chief Financial Officer of
Serv-Tech, Inc., a supplier of specialty maintenance services to the refining,
petrochemical, oil production and utility industries, whose stock is listed on
NASDAQ.
Ms. Banner joined the Company in 1990 as General Counsel and assumed the
position of Assistant Secretary during that year. In 1993, Ms. Banner assumed
the position of Vice President and Secretary of the Company.
5
<PAGE> 8
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's officers and directors, and persons who own more than 10 percent
of a registered class of the Company's equity securities, to file reports of
ownership and changes of ownership with the Securities and Exchange Commission.
Officers, directors and greater than 10 percent stockholders are required to
furnish the Company with copies of all Section 16(a) reports they file.
Based solely on its review of the forms received by it, or written
representations from certain reporting persons that no Form 5 reports were
required for those persons, the Company believes that during the year ended May
31, 1995, all filing requirements applicable to the Company's officers,
directors and greater than 10 percent shareholders were satisfied. See, however,
"Potential Adverse Claim."
EMPLOYMENT AND OTHER AGREEMENTS
Mr. Slack and Ms. Banner are parties to employment agreements with the
Company. Mr. Slack's employment agreement terminates October 31, 1997 but may be
extended, by written amendment, at any time prior to October 31, 1997, or within
thirty (30) days thereafter. Ms. Banner's employment agreement has a continually
renewing term of one year until she reaches the age of sixty five (65) unless
terminated earlier with or without cause by either Ms. Banner or the Company.
Pursuant to the terms of such employment agreements, each officer has agreed not
to disclose any confidential information regarding the Company without the prior
written consent of the Company. In addition, each officer, in certain
circumstances, has agreed not to compete with the Company for a minimum of one
year with respect to Ms. Banner and two years with respect to Mr. Slack
following the officer's termination of employment. Pursuant to such employment
agreements, in the event that either officer is terminated without cause, such
officer would be entitled to severance payments for a specific length of time.
Messrs. Hall, Harrison and Bramblett entered into consulting and salary
continuation agreements with the Company on December 24, 1990 which provide for
the Company to retain each individual as a consultant for a period of 10 years
after termination of his employment pursuant to his employment agreement, except
if such individual is terminated for cause or if he voluntarily terminates his
employment with the Company prior to May 31, 1995. Pursuant to such agreements,
Mr. Harrison will receive an annual consulting fee of $48,000. Mr. Hall, who
ceased to be an officer and employee of the Company effective August 25, 1995,
and Mr. Bramblett, who retired as an officer and employee of the Company
effective June 1, 1995, currently receive annual consulting fees of $150,000 and
$48,000 respectively, pursuant to such agreement. Additionally, Mr. Hall was a
party to a supplemental retirement agreement. See "Pension Plan for Mr. Hall."
6
<PAGE> 9
EXECUTIVE COMPENSATION AND OTHER MATTERS
The following table sets forth compensation information for the fiscal
years ended May 31, 1995, 1994 and 1993 for the Chief Executive Officer and the
other executive officers of the Company earning in excess of $100,000 during the
Company's 1995 fiscal year (the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
OTHER ALL
ANNUAL RESTRICTED OTHER
COMPEN- STOCK OPTIONS/ LTIP COMPEN-
NAME AND SALARY BONUS SATION AWARD(S) SARS PAYOUTS SATION
PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($) ($)1
- ------------------------------------ ---- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
H. Wesley Hall,(2).................. 1995 250,000 -- -- -- -- -- 134,750
Chairman of the Board of
Directors, 1994 250,000 -- -- -- 40,000 -- 134,838
President and Chief Executive
Officer 1993 250,000 -- -- -- -- -- 133,750
George W. Harrison,................. 1995 125,000 -- -- -- -- -- 1,875
Senior Vice President 1994 125,000 -- -- -- 15,000 -- 2,450
1993 125,000 -- -- -- -- -- 1,875
William T. Bramblett,(3)............ 1995 115,000 -- -- -- -- -- 1,725
Senior Vice President 1994 115,000 -- -- -- 5,000 -- 2,250
1993 115,000 -- -- -- -- -- 1,724
Valerie L. Banner(4)................ 1995 115,917 -- -- -- -- -- 1,814
Vice President, General 1994 108,000 5,000 -- -- 10,000 -- 2,120
Counsel and Secretary
</TABLE>
- ---------------
(1) Includes (a) director's fees paid to Mr. Hall of $11,000 in fiscal 1995, (b)
contributions made by the Company to the Team, Inc. Salary Deferral Plan
and Trust under Section 401(k) of the Internal Revenue Code for Messrs.
Hall, Harrison, Bramblett and Ms. Banner, respectively, of $3,750, $1,875,
$1,725 and $1,814 in fiscal 1995, and (c) amounts accrued in fiscal 1995
with respect to the 1990 irrevocable supplemental retirement grantor trust
established by the Company for the benefit of Mr. Hall of $120,000 -- See
"Pension Plan for Mr. Hall."
(2) Although Mr. Hall is currently a director of the Company, effective August
25, 1995, he ceased serving as the Company's Chairman of the Board of
Directors, President and Chief Executive Officer.
(3) Mr. Bramblett retired effective June 1, 1995.
(4) Ms. Banner was named an executive officer during fiscal 1994.
7
<PAGE> 10
OPTION GRANTS IN FISCAL 1995
During fiscal 1995, there were no stock options granted to the Named
Executive Officers under the Company's stock option plans.
OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION VALUES
The following table provides certain information with respect to options
exercised during the fiscal year ended May 31, 1995 by each of the Named
Executive Officers:
<TABLE>
<CAPTION>
VALUE OF
NUMBER NUMBER OF UNEXERCISED
OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT END OPTIONS AT END
ACQUIRED OF FISCAL 1995 OF FISCAL 1995
ON VALUE ----------------------------- ----------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
H. Wesley Hall............. -- -- 100,000 20,000 -- --
George W. Harrison......... -- -- 22,500 7,500 -- --
William T. Bramblett....... -- -- 17,500 2,500 -- --
Valerie L. Banner.......... -- -- 20,000 5,000 -- --
</TABLE>
PENSION PLAN FOR MR. HALL
Certain benefits were extended to Mr. Hall pursuant to a 1990 Supplemental
Retirement Agreement, which provided for the establishment by the Company of a
trust in the amount of $500,000 for the benefit of Mr. Hall. Each year, the
Company recorded, for accounting purposes, a book expense of $120,000 against
the trust. Pursuant to a First Amendment to Supplemental Retirement Agreement,
effective June 23, 1994, Mr. Hall became fully vested in 80 percent of the value
of the assets in the trust fund as of May 31, 1994 and received a distribution
of same equaling $488,408.80. Effective May 31, 1995, the balance of the trust
fund equaling $128,844 became fully vested and thereafter the remaining balance
of the trust fund was distributed to Mr. Hall.
POTENTIAL ADVERSE CLAIM
Mr. Hall, a current Director of the Company and former Chairman of the
Board, Chief Executive Officer and President, has, subsequent to his cessation
of employment with the Company, verbally asserted claims against the Company,
primarily regarding certain benefits he alleges were granted to him prior to the
date on which his employment was terminated with the Company. It is the
Company's understanding, based upon Mr. Hall's verbal communications, that Mr.
Hall is alleging, among other things, that options to purchase common stock of
the Company previously awarded to him and other directors and key employees were
repriced by the Board of Directors in May 1995 to reduce the option exercise
price, and that the Company's executive officers and directors failed to file
appropriate Form 4 and/or Form 5 reports reflecting the amended exercise price.
Further, Mr. Hall has alleged that the Company's 1987 Amended and Restated Stock
Option Plan was modified by the Board of Directors to provide that stock options
held by Messrs. Hall, Bramblett and Harrison would not lapse upon the thirtieth
day following such individual's cessation of employment with the Company, but
would continue in effect. Mr. Hall further alleges that the Company's Board of
Directors took action in June 1995 to extend insurance benefits to certain
consultants of the Company who met specified requirements. At the alleged date
of adoption, these requirements would have resulted in extended insurance
benefits being provided solely to Messrs. Bramblett and Hall prior to age 65
during their tenure as consultants
8
<PAGE> 11
to the Company pursuant to their respective Consulting and Salary Continuation
Agreements. The Company's Board of Directors confirmed on September 13, 1995,
that none of the claimed actions were taken, except with respect to certain
insurance benefits presently provided to Mr. Bramblett.
COMPENSATION COMMITTEE REPORT
Pursuant to rules adopted by the Securities and Exchange Commission, the
Compensation Committee of the Board of Directors (the "Committee"), which is
composed entirely of independent outside directors, has furnished the following
report on executive compensation:
The Committee's major responsibilities include, but are not limited to, the
following:
1. Reviewing the Company's major compensation and benefit practices,
policies and programs with respect to executive officers;
2. Reviewing executive officers' salaries and bonuses; and
3. Administering the Company's stock option plans.
Following review and approval by the Committee, all issues pertaining to
the compensation of, and the grant of options to, the executive officers are
submitted to the full Board of Directors for approval.
COMPENSATION PHILOSOPHY
The Committee's compensation philosophy operates on several different
levels. First, the Committee must ensure that the compensation is competitive in
order to attract and retain highly qualified executives. In order to facilitate
the first objective, the Committee as a rule considers various compensation
surveys and proxy statements for companies in the industry of comparable size
and complexity to the Company. Second, in order to motivate its executives, the
Committee links executive pay levels to the performance of the Company through
the grant of options pursuant to the stock option program. Third, the Committee
endeavors to reward outstanding individual contributions to the Company and to
set compensation at levels that reflect each executive officer's individual
contribution towards the Company's goals through its bonus and stock option
programs. The Committee endeavors to support the Company's commitment to
providing superior shareholder value. The compensation and related programs are
designed to reward and motivate executives for the accomplishment of the
Company's commitment to its shareholders.
COMPENSATION PROGRAM COMPONENTS
Messrs. Hall, Harrison and Bramblett's salaries were established pursuant
to employment agreements entered into with the Company in December 1990 which
expired May 31, 1995. Pursuant to these agreements, Messrs. Hall, Harrison and
Bramblett received annual salaries of $250,000, $125,000 and $115,000 for fiscal
1995. Although Mr. Harrison's employment agreement has expired, the Committee
will recommend to the Board of Directors that Mr. Harrison should, at the
present time, continue in his current position at an annual salary of $125,000.
In addition, Messrs. Hall, Harrison and Bramblett entered into consulting and
salary continuation agreements with the Company on December 24, 1990 which
provide for the Company to retain each individual as a consultant for a period
of 10 years after termination of his employment pursuant to his employment
agreement, except if such individual was terminated for cause or if he
voluntarily terminated his employment with the Company prior to May 31, 1995.
Pursuant to such agreements, Mr. Harrison will receive an annual consulting fee
of $48,000. Mr. Hall, who ceased to be an officer and employee of the Company
9
<PAGE> 12
effective August 25, 1995, and Mr. Bramblett, who retired as an officer and
employee of the Company effective June 1, 1995, currently receive annual
consulting fees of $150,000 and $48,000 respectively, pursuant to such
agreements. Additionally, Mr. Hall was a party to a supplemental retirement
agreement. See "Pension Plan for Mr. Hall".
Base salaries for Ms. Banner and Mr. Slack are set forth in their
respective employment agreements. The Committee does, however, retain the
discretion to reward Ms. Banner and Mr. Slack with upward compensation
adjustments and/or bonuses as conditions merit.
To achieve its compensation goals, the compensation program consists of
four components -- base salary, bonuses, various employee benefits (including
medical and life insurance and 401(k) plan benefits generally available to the
employees of the Company) and the Company's stock option plan. The total program
is structured to deliver a significant percentage of pay through at-risk pay
programs which reward executives if the performance of the Company warrants.
Maximizing shareholder value is a basic principle underlying the Company's pay
programs.
Annually, the Committee seeks to review the base salary of each executive
officer to determine its fairness. In addition, the Committee has recently
retained the services of an independent compensation consultant specializing in
executive compensation to assist the Committee in analyzing the Company's
compensation and benefit practices, policies and programs with respect to its
executive officers. During its annual consideration of the base salaries of the
executive officers, the Committee considers the level of responsibility,
experience and performance of each executive officer. The Committee also takes
into account the competitive conditions of the marketplace, the Company's
profitability as well as the cost of living index. When reviewing competitive
conditions of the marketplace, the Committee considers the Company's pay levels
with those of companies of similar size and complexity. As the Company believes
there is no survey data relating to the Company's service industries, the
Company studies compensation surveys for companies of a similar size and
complexity and various other data and information brought to its attention,
including proxy statements, of companies in the Company's service industry.
Based on such information, the Committee endeavors to ensure that the pay levels
fall in the median range of the amounts paid by the comparable companies. In
certain circumstances, bonuses may be awarded to those executive officers who
have made outstanding individual contributions during the current fiscal year.
Additionally, all executive officers are eligible to receive stock options,
at the Committee's discretion, giving them the right to purchase shares of the
Company's stock at a specified price in the future. By increasing senior
management's equity position in the Company, the interests of the shareholders
and the executives will be more closely aligned.
In order to ensure Ms. Banner of a more competitive salary with her peers,
the Compensation Committee granted her a $10,000 increase in salary during the
1995 fiscal year. Additionally, as an inducement for Mr. Slack to join the
Company, Mr. Slack was granted options to purchase 12,500 shares of the Company.
No other salary increases or grants of stock options were given to the Company's
executive officers during fiscal 1995. The Committee continues to consider its
pay levels to be fair and competitive.
As previously mentioned, the Committee and the consultant recently retained
by the Committee are currently working together to formulate recommendations
regarding the Company's pay practices to be submitted to the Board of Directors
for consideration.
10
<PAGE> 13
PERFORMANCE MEASURES
When evaluating annual executive compensation, the Committee considers the
Company's earnings, adjusted for certain unusual or nonrecurring items, return
on net investment and cash flows. These factors are compared to the Company's
prior year's performance, its annual business plan and the performance of other
companies which operate in the same industry segments as the Company. These
performance measures assist the Committee in ensuring that the interests of its
shareholders, as well as its executives, are represented in a fair and equitable
manner.
No specific fixed weighting or formula is applied to such performance
measures. Rather, the Committee exercises its judgment in evaluating financial
and non-financial factors and in determining appropriate compensation.
FISCAL 1995 COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
As previously noted, Mr. Hall's annual salary of $250,000 was set forth in
an employment agreement with the Company, which Agreement was entered into on
December 24, 1990 and terminated on May 31, 1995. Mr. Hall did not receive a
salary increase, bonus or grant of stock options during fiscal 1995. Effective
August 25, 1995, Mr. Hall ceased to be Chief Executive Officer of the Company.
OTHER
The Omnibus Budget Reconciliation Act of 1993 (the "Act") restricts the
ability of a publicly-held corporation to deduct compensation in excess of
$1,000,000 paid to its Chief Executive Officer and the four most highly
compensated officers. During the 1995 fiscal year, the threshold was not met for
any of the executive officers. However, the Committee continually reviews all
aspects of the Act in order to determine future compliance issues regarding
same.
This Compensation Committee Report was for the most part prepared by
management at the direction of the Committee, and approved by the Committee.
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
Jack M. Johnson, Jr. -- Chairman William A. Ryan -- Chairman
John L. Farrell, Jr. E. Theodore Laborde
Sidney B. Williams Sidney B. Williams
(October 28, 1994 to present) (June 1, 1994 to October 28, 1994)
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Williams served on the Committee and Board of Directors during fiscal
1995. Mr. Williams is also a sole shareholder of a professional corporation
which is a partner in the law firm of Chamberlain, Hrdlicka, White, Williams and
Martin in Houston, Texas which rendered services to the Company during fiscal
1995. Fees to the law firm did not exceed five percent of that law firm's gross
revenue for its last full fiscal year. In addition, each of the members of the
Committee has been granted options under the Company's Non-Employee Director
Plan.
11
<PAGE> 14
COMPARISON OF TOTAL SHAREHOLDER RETURN
The following graph compares the Company's cumulative total shareholder
return on its common stock for a five-year period (May 31, 1990 to May 31,
1995), with the cumulative total return of the American Stock Exchange Market
Value Index ("ASEMVI"), and a peer group of companies selected by the Company.
The "Peer Group" is described in more detail below. The graph assumes that the
value of the investment in the Company's common stock and each index was $100 at
May 31, 1990 and that all dividends were reinvested.
COMPARISON OF CUMULATIVE TOTAL RETURN*
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------
DESCRIPTION 1990 1991 1992 1993 1994 1995
- -------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
TEAM, INC. $100.00 $ 53.13 $ 38.84 $ 29.50 $ 26.22 $ 11.47
AMEX COMPOSITE $100.00 $102.46 $108.71 $120.70 $121.32 $135.54
PEER GROUP ONLY $100.00 $ 86.44 $ 76.37 $ 60.88 $ 49.25 $ 35.65
</TABLE>
* Total Return Assumes Reinvestment of Dividends
NOTE: Total Returns Based on Market Capitalization
The peer group is composed of five companies which provide environmental
emissions monitoring, consulting and/or leak repair services. Certain of the
members of the peer group became reporting companies pursuant to Section 15(d)
of the Securities Exchange Act of 1934 during the preceding five fiscal years
(as noted below). The returns of each company have been weighted according to
their respective market capitalization for purposes of arriving at a peer group
average. The members of the peer group are Air and Water Technologies
Corporation, Dames & Moore, Inc. (began reporting in March 1992), International
Testing Services, Inc. (began reporting in August 1991), Kaneb Services, Inc.
and Versar, Inc.
The foregoing graph is based on historical data and is not necessarily
indicative of future performance.
12
<PAGE> 15
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the Company's common stock (the only class of voting securities of
the Company) as of September 15, 1995 of (a) each person known by the Company to
be the beneficial owner of more than 5% of the outstanding Common Stock, (b)
each director or nominee for director of the Company, (c) the Named Executive
Officers and (d) all executive and other officers and directors of the Company
as a group. The information shown assumes the exercise by each person (or all
directors and officers as a group) of the vested stock options owned by such
person and the exercise by no other person (or group) of stock options. Unless
otherwise indicated, the address of each person named below is the address of
the Company at 1001 Fannin Street, Suite 4656, Houston, Texas 77002.
<TABLE>
<CAPTION>
NUMBER
OF
NAME AND ADDRESS SHARES
OF BENEFICIAL OWNER OWNED(1) PERCENTAGE
------------------- ------- ----------
<S> <C> <C>
William A. Ryan................................... 45,500(2) 0.9%
Sidney B. Williams................................ 106,906(3) 2.0%
1400 Citicorp Center
1200 Smith Street
Houston, Texas 77002
John L. Farrell, Jr. ............................. 35,000(4) 0.7%
c/o The Morgan Investment Group
5410 S. 94th, E. Ave.
Tulsa, Oklahoma 74145
E. Theodore Laborde............................... 26,886(5) 0.5%
601 Poydras Street, Suite 1850
New Orleans, Louisiana 70130
Jack M. Johnson, Jr. ............................. 25,000(6) 0.5%
127 N. McCarty
Eagle Lake, Texas 77434
Thomas N. Amonett................................. 11,000(7) 0.2%
2801 Post Oak Boulevard, Suite 400
Houston, Texas 77056
H. Wesley Hall.................................... 203,495(8)(12) 3.9%
2925 Albans
Houston, Texas 77005
George W. Harrison................................ 130,495(9)(12) 2.5%
1019 S. Hood Street
Alvin, Texas 77511
William T. Bramblett.............................. 78,982(12) 1.5%
Valerie L. Banner................................. 21,174(10)(12) 0.4%
All directors and executive and other officers as
a group (10 persons including nine of the
10 directors and officers listed above)......... 621,706(11)(12) 11.3%
</TABLE>
(Table continued on following page)
13
<PAGE> 16
<TABLE>
<CAPTION>
NUMBER
OF
NAME AND ADDRESS SHARES
OF BENEFICIAL OWNER OWNED(1) PERCENTAGE
------------------- -------- ----------
<S> <C> <C>
Brinson Partners, Inc. ........................... 497,600(13) 9.6%
209 South LaSalle
Chicago, Illinois 60604-1295
Dimensional Fund Advisors Inc. ................... 324,700(14) 6.3%
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401
</TABLE>
- ---------------
(1) The information as to beneficial ownership of common stock has been
furnished, respectively, by the persons and entities listed. Each
individual or entity has sole power to vote and dispose of all shares
listed opposite his or its name except as indicated below.
(2) Includes 500 shares owned by Joan Ryan, Mr. Ryan's wife, and 40,000 shares
which may be acquired pursuant to the exercise of stock options by Mr.
Ryan.
(3) Includes 2,685 shares owned by Nancy Williams, Mr. William's wife, and
1,000 shares held as custodian under the Uniform Gift to Minors Act for Mr.
William's nephews. Mr. Williams disclaims any economic interest in these
shares. Also includes 65,000 shares which may be acquired pursuant to the
exercise of stock options by Mr. Williams.
(4) Includes 30,000 shares which may be acquired pursuant to the exercise of
stock options by Mr. Farrell.
(5) Includes 1,886 shares owned by Mr. Laborde and his wife, Mary Laborde, as
joint tenants. Also includes 25,000 shares which may be acquired pursuant
to the exercise of stock options by Mr. Laborde.
(6) Includes 20,000 shares which may be acquired pursuant to the exercise of
stock options by Mr. Johnson.
(7) Includes 10,000 shares which may be acquired pursuant to the exercise of
stock options by Mr. Amonett.
(8) Includes 400 shares owned by the Estate of Herbert W. Labadie, Deceased, of
which Lou Hall, Mr. Hall's wife, is executrix, and 100,000 shares which may
be acquired pursuant to the exercise of stock options by Mr. Hall.
(9) Includes 22,500 shares which may be acquired pursuant to the exercise of
stock options by Mr. Harrison.
(10) Includes 20,000 shares which may be acquired pursuant to the exercise of
stock options by Ms. Banner.
(11) Calculation does not include shares held by Mr. Bramblett who has retired
as an executive officer of the Company. Includes 338,750 shares which may
be acquired pursuant to the exercise of stock options.
(12) Includes shares allocated to the employee through his participation in the
Company's Employee Stock Ownership Plan and the Salary Deferral Plan and
Trust. According to the latest statements for said plans, the shares are
allocated as follows:
<TABLE>
<CAPTION>
ALL
EXECUTIVE
AND
OTHER
OFFICERS
MR. MR. MR. MS. AS A
HALL HARRISON BRAMBLETT BANNER GROUP
----- -------- --------- ------ --------
<S> <C> <C> <C> <C> <C>
Employee Stock Ownership
Plan......................... 1,740 914 830 174 1,088
Salary Deferral Plan and
Trust........................ 1,604 13,565 10,162 0 13,565
</TABLE>
(Footnotes continued on following page)
14
<PAGE> 17
Calculation for all executive and other officers as a group does not
include Messrs. Hall and Bramblett, both of whom have ceased to be
executive officers of the Company.
(13) Includes 227,200 shares owned by Brinson Partners, Inc. and 270,400 shares
owned by Brinson Trust Company. Each owner retains sole voting and
dispositive power with respect to the shares owned by such owner. The
Company has relied upon information contained in an Amendment No. 4 to
Schedule 13G filed with the SEC on February 14, 1995.
(14) The Company has relied upon information contained in Amendment No. 2 to
Schedule 13G filed with the SEC on February 16, 1995.
The Company does not know of any arrangement that may at a subsequent date
result in a change of control of the Company.
PROPOSAL TWO -- APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Company's Audit Committee has recommended and the Board of Directors
has approved and now recommends the appointment of Deloitte & Touche as
independent certified public accountants to audit the Company's accounts for the
fiscal year ended May 31, 1996. The firm has audited the Company's accounts
since 1974. Approval of the appointment will require the affirmative vote of a
majority of the shares represented and voted at the meeting.
A representative of Deloitte & Touche will attend the 1995 Annual Meeting
with the opportunity to make a statement if such representative desires to do so
and to respond to appropriate questions presented at the meeting.
OTHER BUSINESS
Management does not intend to bring any business before the meeting other
than the matters referred to in the accompanying notice and at this date has not
been informed of any matters that may be presented to the meeting by others. If,
however, any other matters properly come before the meeting, it is intended that
the persons named in the accompanying proxy will vote, pursuant to the proxy, in
accordance with their best judgment on such matters.
SHAREHOLDER PROPOSALS
Any proposal by a shareholder to be presented at the Company's Annual
Meeting of Shareholders in 1996 must be received by the Company no later than
May 29, 1996 in order to be eligible for inclusion in the Company's Proxy
Statement and form of proxy used in connection with such meeting.
By Order of the Board of Directors
William A. Ryan
Chairman of the Board of Directors,
President and Chief Executive Officer
September 26, 1995
15
<PAGE> 18
[TEAM LOGO] recycled paper
<PAGE> 19
PROXY
TEAM, INC.
The undersigned hereby appoints William A. Ryan and John M. Slack, and either
or both of them, with full power of substitution in each, as proxy or proxies
of the undersigned to represent and vote all of the shares of common stock of
Team, Inc. ("Company"), which the undersigned is entitled to vote at the 1995
Annual Meeting of Shareholders of the Company to be held on Wednesday,
November 1, 1995, at 3:00 p.m. Houston time, at The Wyndham Warwick, The
Presidential Suite, 5701 Main Street, Houston, Texas, and at any adjournments
thereof, as follows:
Election of Directors, Nominees:
Sidney B. Williams
George W. Harrison
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
PLEASE SIGN, DATE AND RETURN THIS PROXY AS SOON AS POSSIBLE IN THE ENCLOSED
ENVELOPE. THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO CHOICE IS SPECIFIED FOR
A PROPOSAL, THIS PROXY WILL BE VOTED "FOR" THE PROPOSAL. Any proxies previously
given by the undersigned are hereby revoked. Receipt of Notice of the above
Annual Meeting of Shareholders and of the related Proxy Statement is hereby
acknowledged.
-----------
SEE REVERSE
SIDE
-----------
<PAGE> 20
/X/ PLEASE MARK YOUR SHARES IN YOUR NAME
VOTES AS IN THIS
EXAMPLE
WITHHOLD
FOR AUTHORITY
1. Election of / / / /
two Class
III members
of the Board
of Directors:
For, except vote withheld from the following nominee(s):
_________________________________________________________
FOR AGAINST ABSTAIN
2. Proposal to approve the / / / / / /
appointment of Deloitte &
Touche as the Indepen-
dent certified public
accountants of the
Company.
3. In their discretion on such other matters
as may properly come before the meet-
ing and any adjournments thereof.
SIGNATURE(S)________________________________________________ DATE: _______, 1995
SIGNATURE(S)________________________________________________ DATE: _______, 1995
NOTE: (When signing as attorney, executor, trustee, guardian, corporate officer
or other agent, please give full title.)
