SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Petroleum Helicopters, Inc.
(Name of Registrant as Specified In Its Charter)
Petroleum Helicopters, Inc.
(Name of Person(s) Filing Proxy Statement)
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(j)(2).*
[ ] $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:<FN1>
4) Proposed maximum aggregate value of transaction:
* Previously filed
<FN1> Set forth the amount on which the filing fee is calculated
and state how it was determined.
[ ] 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.:
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_____________________________
4) Date Filed:
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<PAGE>
PETROLEUM HELICOPTERS, INC.
5728 Jefferson Highway
P.O. Box 23502
New Orleans, Louisiana 70183
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Holders of Voting Common Stock of Petroleum
Helicopters, Inc.:
The annual meeting of stockholders of Petroleum Helicopters,
Inc. ("PHI") will be held at PHI's offices, 5728 Jefferson
Highway, New Orleans, Louisiana, on Wednesday, September 28,
1994, at 10:00 a.m., New Orleans time, to:
1. Elect directors.
2. Consider and vote upon a proposal to change PHI's state
of incorporation from the State of Delaware to the
State of Louisiana by adopting an Agreement of Merger
dated August 25, 1994.
3. Transact such other business as may properly come
before the meeting or any adjournments thereof.
Only holders of record of PHI's voting common stock at the
close of business on August 1, 1994, are entitled to notice of
and to vote at the annual meeting.
PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE
ACCOMPANYING ENVELOPE AS PROMPTLY AS POSSIBLE. A PROXY MAY BE
REVOKED AT ANY TIME PRIOR TO THE VOTING THEREOF.
By Order of the Board of Directors
/s/ Robert D. Cummiskey, Jr.
Robert D. Cummiskey, Jr.
Secretary
New Orleans, Louisiana
August 25, 1994
<PAGE>
PETROLEUM HELICOPTERS, INC.
5728 Jefferson Highway
P.O. Box 23502
New Orleans, Louisiana 70183
August 25, 1994
PROXY STATEMENT
This Proxy Statement is furnished to holders of voting
common stock ("Voting Common Stock") of Petroleum Helicopters,
Inc. ("PHI") in connection with the solicitation on behalf of its
Board of Directors (the "Board") of proxies for use at the annual
meeting of stockholders of PHI to be held on Wednesday, September
28, 1994 at the time and place set forth in the accompanying
notice and at any adjournments thereof (the "Meeting").
Only stockholders of record of Voting Common Stock at the
close of business on August 1, 1994 (the "Record Date") are
entitled to notice of and to vote at the Meeting. On that date,
PHI had outstanding 3,278,068 shares of Voting Common Stock, each
of which is entitled to one vote.
The enclosed proxy may be revoked by the stockholder at any
time prior to the exercise thereof by filing with PHI's Secretary
a written revocation or duly executed proxy bearing a later date.
A stockholder who votes in person at the Meeting in a manner
inconsistent with a proxy previously filed on the stockholder's
behalf will be deemed to have revoked such proxy as it relates to
the matter voted upon in person.
This Proxy Statement is first being mailed to stockholders
on or about August 25, 1994, and the cost of soliciting proxies
in the enclosed form will be borne by PHI. In addition to the
use of the mails, proxies may be solicited by personal interview,
telephone and telegraph. Banks, brokerage houses and other
nominees or fiduciaries will be requested to forward the
soliciting material to their principals and to obtain
authorization for the execution of proxies, and PHI will, upon
request, reimburse them for their expenses in so acting.
ELECTION OF DIRECTORS
PHI's By-laws establish the number of directors to be
elected at the Meeting at four, and proxies cannot be voted for a
greater number of persons. Unless authority is withheld, the
persons named in the enclosed proxy will vote the shares
represented by the proxies received by them for the election of
the four persons named below to serve until the next annual
meeting and until their successors are duly elected and
qualified. In the unanticipated event that one or more nominees
cannot be a candidate at the Meeting, the By-laws provide that
the number of authorized directors will be automatically reduced
by the number of such nominees unless the Board determines
otherwise, in which case proxies will be voted in favor of such
other nominees as may be designated by the Board.
The following table sets forth certain information as of the
Record Date with respect to each nominee to be proposed on behalf
of the Board. Unless otherwise indicated, each person has been
engaged in the principal occupation shown for the past five
years.
Year First
Became a
Name and Age Principal Occupation Director
Carroll W. Suggs, 55 Chairman of the Board and 1989
Chief Executive Officer.<FN1>
Leonard M. Horner, 67 Private Investments.<FN2> 1992
Robert E. Perdue, 65 Private Investments; 1990
Consultant to The Boeing
Company (aircraft
manufacturer) and other
aviation companies.<FN3>
Robert G. Lambert, 64 Consultant; Chairman of the 1994
Board of Directors of
Aviall, Inc. (aviation parts
distributor and provider of
aviation engine repair
services)<FN4>
_____________________
<FN1> Mrs. Suggs became Chief Executive Officer in July 1992 and
Chairman of the Board in March 1990. From September 1989
until March 1990, Mrs. Suggs served as PHI's Vice Chairman
of the Board. Since August 1993, Mrs. Suggs has also served
as a director of Varco International, Inc.
<FN2> From 1974 to 1991, Mr. Horner served in various capacities
with Bell Helicopter Textron (helicopter manufacturer),
including Chairman, President, Executive Vice President,
Senior Vice President-Marketing and Programs, and Vice
President-Operations. Prior to 1974, Mr. Horner was
employed by United Technologies/Sikorsky Aircraft
(helicopter manufacturer) for 17 years.
<FN3> Mr. Perdue served The Boeing Company from 1986 until 1989 as
Vice President-Sales, U.S., Canada and Leasing Companies,
and from 1983 until 1986 as Vice President-Sales, Europe and
Canada.
<FN4> From 1989 through 1992, Mr. Lambert served as Senior
Executive Vice President - Aviation of Ryder System, Inc.
_____________________
No director, nominee or executive officer of PHI has a
family relationship with any other such person.
During fiscal 1994, the Board held six meetings. Each
incumbent director of PHI attended at least 75% of the aggregate
number of meetings held during fiscal 1994 of the Board and
committees of which he or she was a member.
The Board has a Finance, Audit and Compensation Committee
(the "Committee"), the members of which are Messrs. Horner and
Perdue. The Committee, which met twice during fiscal 1994, is
responsible for making recommendations to the Board concerning
the selection and retention of PHI's independent auditors,
reviewing the results of audits of PHI by its independent
auditors, and discussing audit recommendations with management
and reporting the results of its reviews to the Board. The
Committee is also responsible for reviewing and making
recommendations regarding the compensation of employees,
officers, and directors of PHI and administering PHI's 1992 Non-
Qualified Stock Option and Stock Appreciation Rights Plan. The
Board does not maintain a standing nominating committee.
PROPOSAL TO CHANGE STATE OF INCORPORATION
General
At the Annual Meeting, the stockholders will be asked to
consider and vote upon a change in the state of incorporation of
PHI from the State of Delaware to the State of Louisiana (the
"Reincorporation Proposal") by adopting an Agreement of Merger
(the "Merger Agreement"), which provides for PHI's merger (the
"Merger") into a wholly owned subsidiary of PHI recently
organized under the laws of Louisiana for that purpose (the
"Louisiana Corporation").
The Merger will not involve any change in the name, business
or management of PHI. The Merger, however, will change the law
applicable to PHI's corporate affairs from that of Delaware to
that of Louisiana, and will result in PHI being governed by the
Articles of Incorporation and By-laws of the Louisiana
Corporation, which are hereinafter referred to as the "New
Charter" and the "New By-laws," respectively. A copy of the New
Charter is attached hereto as Exhibit A.
PHI's capital stock currently consists of voting common
stock, $.08 1/3 par value per share (the "Voting Common Stock"),
and non-voting common stock, $.08 1/3 par value per share (the
"Non-Voting Common Stock," and together with the Voting Common
Stock, the "PHI Stock"). Pursuant to the Merger, each issued and
outstanding share of Voting Common Stock will be converted into
one share of voting common stock, $.10 par value per share, of
the Louisiana Corporation (the "New Voting Stock") and each
issued and outstanding share of Non-Voting Stock will be
converted into one share of Non-Voting Common Stock, $.10 par
value per share, of the Louisiana Corporation (the "New Non-
Voting Stock," and together with the New Voting Stock, the "New
Stock"). As with the relative rights of the Voting Common Stock
and Non-Voting Common Stock, the New Voting Stock and New Non-
Voting Stock will be identical in all respects, except with
respect to voting rights.
Although the Board believes that the Merger will not
significantly change the rights of PHI's stockholders, certain
provisions of the New Charter and New By-laws vary from those
existing in PHI's current Restated Certificate of Incorporation
and By-laws (referred to hereinafter as the "Current Charter" and
the "Current By-laws," respectively), the more significant of
which are discussed below. There are also numerous differences
in Delaware and Louisiana law, the more significant of which are
also discussed below. See "Comparative Rights of Stockholders
Before and After the Reincorporation."
Reasons for and Certain Effects of the Reincorporation
The Board believes that the reincorporation from the State
of Delaware to the State of Louisiana (the "Reincorporation") is
in the best interests of PHI and its stockholders. The
discussion below summarizes the reasons that the Board has
proposed the Reincorporation and certain effects of the
Reincorporation.
As a Delaware corporation that has its principal offices and
operations in Louisiana, PHI must now pay franchise taxes to, and
remain in good standing in both states. Although it transacts
practically no business in Delaware, PHI currently pays in excess
of $60,000 in annual franchise taxes to that state, all of which
will be saved by reincorporating in Louisiana, along with other
administrative costs associated with remaining in good standing
in Delaware. If the Reincorporation is effected, PHI will not
incur any additional franchise tax liability in Louisiana.
The Current Charter authorizes PHI to issue 7,200,000 shares
of Voting Common Stock and 7,200,000 shares of Non-Voting Common
Stock. Although neither PHI nor the Louisiana Corporation has
present plans or arrangements to issue additional stock, the New
Charter authorizes the issuance of up to 12,500,000 shares of New
Voting Stock and 12,500,000 shares of New Non-Voting Stock in
order to facilitate future issuances.
Under the Current Charter, no shares of preferred stock are
authorized; however, the New Charter authorizes the Louisiana
Corporation's Board of Directors to issue, without shareholder
approval, up to ten million shares of preferred stock. For
certain effects of the authorized shares of preferred stock of
the Louisiana Corporation, see "Comparative Rights of
Stockholders Before and After the Reincorporation -- Authorized
Shares of Preferred Stock."
One of the effects of authorizing additional shares of
common stock and authorizing preferred stock may be to enable the
Louisiana Corporation's Board of Directors to make more difficult
or to discourage an attempt to obtain control of the Louisiana
Corporation. The Reincorporation will also increase the
likelihood that litigation involving a contest for corporate
control or a similar dispute involving the Louisiana Corporation
will be brought before courts located in Louisiana, which may be
more likely to consider the effects of such litigation on the
economy and constituents of Louisiana. PHI's Board is unaware of
any pending or threatened tender offers or any other actions to
gain corporate control of PHI and assigned no weight to this
factor in making its determination to recommend the
Reincorporation Proposal to the PHI stockholders. Moreover,
PHI's Board does not currently plan to propose any amendments to
the New Charter that would make more difficult an attempt to
obtain control of the Louisiana Corporation.
Manner of Effecting the Reincorporation
The Reincorporation will be effected by merging PHI with and
into the Louisiana Corporation under the terms and conditions of
the Merger Agreement. At the effective time of the Merger (as
defined in the Merger Agreement), the separate existence of PHI
will cease and each issued and outstanding share of Voting Common
Stock will be converted into one fully paid and nonassessable
share of the New Voting Stock, and each issued and outstanding
share of Non-Voting Common Stock will be converted into one fully
paid and nonassessable share of New Non-Voting Stock, thereby
effecting a one-for-one exchange of all of the outstanding shares
of PHI Stock. Each outstanding certificate representing shares
of Voting Common Stock and Non-Voting Common Stock will continue
to represent the same number of shares of New Voting Stock and
New Non-Voting Stock, respectively, and it will therefore not be
necessary for stockholders of PHI to exchange their existing
stock certificates for new certificates. Following the Merger,
delivery of existing stock certificates will convey good title to
transferees, each of whom will receive a certificate representing
shares of New Stock upon cancellation of the old stock
certificate. It is anticipated that the New Voting Stock and New
Non-Voting Stock will continue to be traded without interruption
on the NASDAQ System (Small-Cap Issues).
Upon approval by PHI's stockholders of the Merger Agreement,
the Board of Directors expects to effect the Merger within thirty
days after the Annual Meeting (the "Effective Date"). The Merger
Agreement, however, provides that the Merger may be abandoned at
any time at the discretion of the Board of Directors of either
corporation.
In accordance with Delaware law, appraisal rights will not
be available to PHI's stockholders in connection with the Merger.
No Change in Name, Business or Management
Upon the Effective Date, the Louisiana Corporation will
succeed to all PHI's businesses, assets and liabilities, and will
conduct its operations in the same name, locations and manner as
the businesses of PHI. As stated in the New Charter, the
Louisiana Corporation will be authorized to enter into any
business activity in which a Louisiana Corporation may lawfully
engage, but no changes in PHI's business are currently
contemplated. PHI's officers and directors on the Effective Date
(after giving effect to the election of directors at the Annual
Meeting) will continue to hold the same offices with the
Louisiana Corporation as they hold with PHI on such date. All
benefit and compensation plans and arrangements of PHI described
in this Proxy Statement will be continued by the Louisiana
Corporation on the same terms and conditions in effect on the
Effective Date.
Comparative Rights of Stockholders Before and After the
Reincorporation
General. Delaware and Louisiana both have comprehensive
corporate statutes governing the affairs of corporations
incorporated under their respective laws. In many cases a
corporation incorporated under these laws is free, within certain
limitations, to elect to be governed by alternate rules, provided
these alternate rules are set forth in the corporation's
certificate or articles of incorporation, or its by-laws.
Although some provisions in the New Charter and New By-laws have
substantially similar effects to the provisions of the Current
Charter and Current By-laws, the Board elected to change certain
of the rules governing the Louisiana Corporation's corporate
affairs. Moreover, certain of the rights of the Louisiana
Corporation's shareholders will differ from those currently
possessed by PHI's stockholders due to requirements imposed by
Louisiana law that cannot be modified.
Some of the material differences between the rights of the
Louisiana Corporation's shareholders and the rights of PHI's
stockholders are set forth below. It should be understood that
the description of these differences is a summary only and does
not purport to be a complete description of all the differences
in rights.
Liability of Officers and Directors. Under the laws of both
Delaware and Louisiana, stockholders are entitled to bring suit,
generally in an action on behalf of the corporation, to recover
damages caused by breaches of the duty of care and the duty of
loyalty owed to a corporation and its stockholders by directors
and, to a certain extent, officers. Both Delaware and Louisiana
permit corporations to (i) include provisions in their
certificate or articles of incorporation that limit personal
liability for monetary damages resulting from breaches of the
duty of care, subject to certain exceptions which are the same
for each state, and (ii) indemnify officers and directors in
certain circumstances for their expenses and liabilities incurred
in connection with defending pending or threatened suits, as more
fully described below.
Limitation of Liability. The Current Charter includes a
provision that eliminates the personal liability of a director to
PHI and its stockholders for monetary damages resulting from
breaches of the duty of care to the fullest extent permitted by
Delaware law and further provides that any amendment or repeal of
this provision will not affect the elimination of liability
accorded to any director for acts or omissions occurring prior to
such amendment or repeal. The New Charter includes a limitation
of liability provision containing virtually identical terms, but
the protection has been extended to officers as well as
directors, which is permitted under Louisiana but not Delaware
law. The New Charter also authorizes the Louisiana Corporation's
Board to enter into contracts with directors and officers
providing for this limitation of liability. See "--
Indemnification and Insurance."
Indemnification and Insurance. Under the corporate statutes
of Delaware and Louisiana, corporations are permitted, and in
some circumstances required, to indemnify, among others, current
and prior officers, directors, employees or agents of the
corporation for expenses and liabilities incurred by such parties
in connection with defending pending or threatened suits
instituted against them in their corporate capacities, provided
certain specified standards of conduct are determined to have
been met. These corporate statutes further permit corporations
to grant indemnification rights more expansive than those
permitted by statute and to purchase insurance for indemnifiable
parties against any liability asserted against or incurred by
such parties in their corporate capacities.
Under Delaware's statute, the granting of indemnification
rights more expansive than those permitted by statute can be
authorized by the stockholders or the directors who will not
benefit thereby. Under Louisiana law, the same authorization may
be given by the shareholders or the board of directors,
regardless of whether any or all of the directors are
beneficiaries of the expanded rights. In addition, unlike
Delaware's statute, Louisiana's statute contains an express
authorization for corporations to establish trust funds,
insurance subsidiaries or other forms of self-insurance for the
benefit of its officers, directors, employees and agents.
The New Charter confirms the authority of the Louisiana
Corporation's Board to (i) adopt by-laws or resolutions providing
for indemnification of directors, officers and other persons to
the fullest extent permitted by law, (ii) enter into contracts
with directors and officers providing for indemnification to the
fullest extent permitted by law and (iii) exercise its power to
procure directors' and officers' liability insurance. The New
Charter also provides that any amendment or repeal of any by-law
or resolution relating to indemnification will not adversely
affect any person's entitlement to indemnification whose claim
results from conduct occurring prior to the date of such
amendment or repeal.
The New By-laws expressly provide for indemnification of
directors, officers and employees to the fullest extent permitted
by law against any costs incurred by him or her in connection
with any threatened, pending or completed claim, action, suit or
proceeding against such person or as to which he or she is
involved solely as a witness or person required to give evidence
because he or she is a director, officer or employee of the
Louisiana Corporation. Without a specific provision regarding
indemnification, the Louisiana Corporation's Board would be
permitted to indemnify directors, officers and employees at its
discretion, but would not be required by law to do so unless such
person was successful in defending a claim against him or her.
The Board anticipates that it will enter into
indemnification contracts with the Louisiana Corporation's
directors and certain or all of its officers that will provide
for the elimination, to the fullest extent permitted by law, of
any indemnified party's liability to the Louisiana Corporation or
its shareholders for monetary damages for breach of his or her
fiduciary duty as a director or officer (see "- Limitation of
Liability"), and will provide the contracting director or officer
with certain procedural and substantive rights to
indemnification. It is anticipated that such indemnification
rights will apply to acts or omissions of such persons, whether
such acts or omissions occurred before or after the effective
date of the contract. Although the New Charter provides for this
limitation of liability and the New By-laws provide certain
indemnification rights discussed above, the Board believes that
the execution of indemnification contracts will provide
additional assurance to directors and officers against the threat
of uninsured liability because the contractual rights and
obligations created thereby will be binding on any successor to
the Louisiana Corporation and cannot be modified without the
consent of all parties thereto.
The Louisiana Corporation anticipates that it will maintain
the same insurance coverage as PHI with respect to the liability
of its directors and officers for actions taken in their official
capacities.
A vote in favor the Reincorporation Proposal will be
considered a vote approving the execution of indemnification
contracts with present and future directors and officers as well
as the indemnification provisions of the New By-laws. The Board
is not aware of any pending or threatened claims or actions that
could result in the indemnification of any directors, officers or
employees under the indemnification contracts contemplated or the
New By-laws.
Authorized Shares of Preferred Stock. Under the Current
Charter, no shares of preferred stock are authorized. The New
Charter authorizes the Louisiana Corporation's Board of Directors
to issue, without shareholder approval, up to 10 million shares
of preferred stock, no par value per share, in one or more series
with such rights, qualifications, limitations or restrictions as
the Board shall specify (the "New Preferred Stock"). Although
PHI has no present plans or commitments for the issuance of any
of these shares, the Board believes that authorizing the New
Preferred Stock will provide it with increased flexibility to
issue preferred stock in connection with the acquisition of
businesses, raising additional capital or for other lawful
corporate purposes. The issuance of any New Preferred Stock
convertible into New Stock, however, may have the effect of
diluting the equity interest of the holders of the New Stock.
One of the effects of authorizing the New Preferred Stock
may be to enable the Louisiana Corporation's Board to make more
difficult or to discourage an attempt to obtain control of the
Louisiana Corporation by means of a merger, tender offer, proxy
contest or otherwise, and thereby to protect the incumbency of
the Louisiana Corporation's management, even if such attempted
change in control was favored by the holders of a majority of the
Louisiana Corporation's total voting power. If, in the due
exercise of its fiduciary obligations, the Louisiana
Corporation's Board were to determine that a takeover proposal
was not in the best interest of the Louisiana Corporation or its
shareholders, such shares could be issued by the Louisiana
Corporation's Board without shareholder approval in one or more
transactions that might prevent, delay or make more difficult or
costly the completion of the takeover transaction. Preferred
Stock issued by the Louisiana Corporation's Board could dilute
the voting or other rights of the proposed acquiror or insurgent
shareholder group, put a substantial voting block in
institutional or other hands that might undertake to support the
position of the incumbent Louisiana Corporation's Board, or
effect an acquisition that might complicate or preclude the
takeover. However, PHI is unaware of any such transactions or
actions and has not proposed the authorization of the New
Preferred Stock to render more difficult or discourage changes in
control of the Louisiana Corporation.
Laws with Possible Antitakeover Effects. Although the Board
is not proposing the Reincorporation for the purpose of
discouraging hostile takeover attempts, the laws of Delaware and
Louisiana that regulate hostile takeover attempts differ in
certain fundamental respects, as described in more detail below.
Fair Price Provisions. Louisiana has adopted a statute (the
"Louisiana Fair Price Statute") that is intended to deter the use
of "two-tier" tender offers in which an "Interested Shareholder"
obtains in a "Business Combination" a controlling interest in the
shares of a Louisiana corporation having 100 or more beneficial
shareholders at a price substantially in excess of the market
value of the corporation's voting stock and seeks in the "second
tier" to compel a merger or similar corporate action in which the
consideration paid to the remaining shareholders is greatly
reduced. Under the statute, an Interested Shareholder is defined
to include any person (other than the corporation, its
subsidiaries or its employee benefit plans) who is the beneficial
owner of shares of capital stock representing 10% or more of the
total voting power of a corporation. The term Business
Combination is broadly defined to include most corporate actions
that an Interested Shareholder might contemplate after acquiring
a controlling interest in a corporation in order to increase his
share ownership or reduce his acquisition debt. These "second
tier" transactions include any merger or consolidation of the
corporation involving an Interested Shareholder, any disposition
of assets of the corporation to an Interested Shareholder, any
issuance to an Interested Shareholder of securities of the
corporation meeting certain threshold amounts and any
reclassification of securities of the corporation having the
effect of increasing the voting power or proportionate share
ownership of an Interested Shareholder.
Under the Louisiana Fair Price Statute, a Business
Combination must be recommended by the board of directors and
approved by the affirmative vote of the holders of 80% of the
total voting power of the corporation and two-thirds of the total
voting power excluding the shares held by the Interested
Shareholder (in addition to any other votes required under law or
the corporation's articles of incorporation), unless the
transaction is approved by the board of directors prior to the
time the Interested Shareholder first obtained such status or the
Business Combination satisfies certain minimum price, form of
consideration and procedural requirements.
Although the statute protects shareholders by encouraging an
Interested Shareholder to negotiate with the board of directors
or to agree to satisfy the minimum price, form of consideration
and procedural requirements imposed thereunder, it does not
prevent an acquisition of a controlling interest of a corporation
by an Interested Shareholder who does not contemplate initiating
a "second tier" transaction. The Louisiana Fair Price Statute
will permit the Louisiana Corporation's Board or its shareholders
to vote to have the Louisiana Corporation opt out of the
statute's protection at any time prior to the time there is an
Interested Shareholder, but it is not anticipated that the
Louisiana Corporation's Board will take such action or recommend
such action to the shareholders.
Delaware does not have a statute containing provisions
comparable to those of the Louisiana Fair Price Statute.
Louisiana Control Share Acquisition Statute and Delaware
Antitakeover Statute. As described further below, both Louisiana
and Delaware have laws that regulate tender offers and hostile
acquisitions. The Louisiana law is referred to as the "Louisiana
Control Share Statute," and the Delaware law is referred to as
the "Delaware Antitakeover Statute."
The Louisiana Control Share Statute provides that, subject
to certain exceptions, any shares of certain publicly-traded
Louisiana corporations acquired by a person or group (the
"Acquiror") that causes such person or group to have the power to
vote or direct the voting of shares in the election of directors
in excess of 20%, 33-1/3% or 50% thresholds shall have only such
voting power as may be accorded by the affirmative vote of, among
others, the holders of a majority of the votes of each voting
group entitled to vote separately on the proposal, excluding all
"interested shares" (as defined below), at a meeting that,
subject to certain exceptions, is required to be called for that
purpose upon the Acquiror's request. The Louisiana Control Share
Statute defines "interested shares" to sterilize the vote of
management of the corporation and the Acquiror and includes all
shares as to which the Acquiror, any officer of the corporation
and any director of the corporation who is also an employee of
the corporation may exercise or direct the exercise of voting
power. If either of the Acquiror fails to comply with certain
specified notice requirements or the stockholders vote against
according voting rights to the shares obtained by the Acquiror,
the corporation has the right to redeem the shares held by the
Acquiror for their fair value. The statute permits the articles
of incorporation or by-laws of a corporation to be amended to
exclude from its application share acquisitions occurring after
the adoption of the amendment; however, neither the New Charter
nor the New By-laws contain any such provision.
Unlike either the Louisiana Fair Price Statute or the
Delaware Antitakeover Statute, the Louisiana Control Share
Statute establishes a referendum format by which disinterested
shareholders may, in effect, demonstrate their support or
opposition to a proposed tender offer or share acquisition by
their vote as to whether to accord or deny voting rights to the
Acquiror with respect to the shares acquired by him or her. On
one hand, the possibility that voting rights might be denied with
respect to interested shares may encourage the Acquiror to
negotiate a non-hostile acquisition with the board of directors.
On the other hand, Acquirors that commence a tender offer at a
price in excess of prevailing market values may be able to
readily obtain the shareholder vote re-enfranchising his or her
shares, which, in all likelihood, would significantly reduce the
pressure on the Acquiror to negotiate with the board of directors
and the willingness of the board to continue to oppose the
transaction.
Under the Delaware Antitakeover Statute, any person who
acquires 15% or more of the outstanding voting stock of a
publicly-held Delaware corporation, without board approval
(thereby becoming an "interested stockholder"), may not engage in
any "business combination" with the corporation for a period of
three years following the date such person became an interested
stockholder unless the interested stockholder is able to obtain,
by virtue of the transaction that resulted in the person becoming
an interested stockholder, at least 85% of the corporation's
outstanding voting stock (excluding for the purposes of this
calculation shares held by directors who are officers and certain
employee benefit plans) or unless the business combination is
approved by the board of directors and the holders of two-thirds
of the outstanding voting stock of the corporation, excluding the
shares held by the interested stockholder.
The "business combinations" subject to the three-year
moratorium include a wide variety of transactions between an
interested stockholder and the corporation and include mergers,
consolidations, asset sales, stock transfers and other transfers.
Similar to the Louisiana Fair Price Statute, the statute does not
prevent tender offers nor does it affect voting rights of the
interested stockholder. Instead, the statute seeks to deter
"two-tier" tender offers containing "second-tier" business
combinations and encourages interested stockholders to negotiate
with the board of directors. Although the statute permits the
Board or PHI's stockholders to vote to have PHI opt out of the
statute, no such action has been taken and the statute therefore
currently applies to PHI.
Evaluation of Tender Offers. Unlike Delaware's corporate
statute, Louisiana's statute expressly permits a board of
directors, when considering a tender offer, exchange offer,
merger or consolidation, to consider, among other factors, the
social and economic effects of the proposal on the corporation,
its subsidiaries, and their respective employees, customers,
creditors and communities. The availability of this statute,
which has yet to be interpreted by a Louisiana court, may
increase the likelihood that directors reviewing a tender offer
will consider factors other than the price offered by an
acquiror, including the effect of the proposed transaction on the
corporation's non-shareholder constituents.
Voting Requirements. To authorize any (i) merger or
consolidation, (ii) sale, lease or exchange of all or
substantially all of a corporation's assets, (iii) voluntary
liquidation or (iv) amendments to the certificate or articles of
incorporation of a corporation, Delaware law requires, subject to
certain limited exceptions, the affirmative vote of the holders
of a majority of the outstanding shares of the voting stock (or
such higher percentage as may be set forth in the certificate of
incorporation). To authorize these same transactions, Louisiana
law requires, subject to certain limited exceptions, the
affirmative vote of the holders of two-thirds (or such larger or
smaller proportion, not less than a majority, as the articles of
incorporation may require) of the voting power present or
represented at the shareholder meeting in which the transaction
is considered and voted upon. To provide the shareholders of the
Louisiana Corporation with substantially the same voting rights
currently held by PHI's stockholders, the New Charter provides
that these transactions will be authorized by the affirmative
vote of the holders of a majority of the Louisiana Corporation's
total voting power. Cumulative voting has not been provided for
in either the Current Charter or New Charter.
Unlike Delaware law, Louisiana law provides that
shareholders are entitled to vote on sales, leases or exchanges
of substantially all of a corporation's assets only if the
corporation is solvent. If the corporation is insolvent, such
approval may be given by the board of directors.
Delaware law provides that the holders of outstanding shares
of a class of stock shall be entitled to vote as a class in
connection with any proposed amendment to the corporation's
certificate of incorporation, whether or not such holders are
entitled to vote thereon by the certificate of incorporation, if
such amendment adversely affects the rights of such holders or
changes the aggregate authorized number or par value of the
shares held thereby. Louisiana law requires a similar vote if
any proposed amendment to the articles of incorporation would
have any of six specified adverse effects on the holders of any
class of stock, unless the articles provide otherwise. The New
Charter does not so provide.
Reduction in Voting Power of Non-U.S. Owned Shares. A
corporation that holds an operating certificate issued by the
Federal Aviation Administration is required to have a required
percentage of its voting interest owned or controlled by United
States citizens. Accordingly, the New Charter, like the Current
Charter, reduces the voting power of shares owned by non-United
States citizens if the total voting power held by such persons
would exceed one percent less than the percentage permitted by
the Federal Aviation Regulations, which is currently 25%. The
New Charter also establishes certain presumptions and authorizes
PHI to take certain procedural actions designed to enhance PHI's
ability to monitor and ensure compliance with these requirements.
Dividends, Redemptions and Stock Repurchases. Set forth
below is a discussion of certain differences in the laws of
Delaware and Louisiana with respect to dividends, redemptions and
stock repurchases.
Dividends. Under both Delaware and Louisiana law, dividends
may be declared by the board of directors and paid out of
surplus, and, if no surplus is available, out of any net profits
for the then current fiscal year or the preceding fiscal year, or
both, provided that such payment will not reduce capital below
the amount of capital represented by all classes of outstanding
stock having a preference as to the distribution of assets upon
liquidation of the corporation. Louisiana law further provides
that no dividend may be paid when the corporation is insolvent or
would thereby be made insolvent, and that shareholders must be
notified of any dividend paid out of capital surplus.
Redemptions and Repurchases. Under Delaware law, a
corporation may redeem or repurchase its outstanding shares
provided that the assets of the corporation would not be reduced
to a level below that of the capital of the corporation. Under
Louisiana law, a corporation may redeem or repurchase its shares
out of surplus or, in certain circumstances, stated capital,
provided in either event that it is solvent and will not be
rendered insolvent thereby, and provided further that the net
assets are not reduced to a level below the aggregate liquidation
preferences of any shares that will remain outstanding after the
redemption.
Reversion of Dividends, Stock and Redeemed Shares. The New
Charter, in accordance with Louisiana law, has a provision that
cash, property or share dividends, shares issuable to
shareholders in connection with a reclassification of stock, and
the redemption price of redeemed shares, that are not claimed by
the shareholders entitled thereto within one year after the
dividend or redemption price became payable or the shares became
issuable revert in full ownership to the Louisiana Corporation,
and the Louisiana Corporation's obligation to pay such dividend
or redemption price or issue such shares, as the case may be,
will thereupon cease, subject to the power of the Louisiana
Corporation's Board to authorize such payment or issuance
following the reversion. Delaware law does not allow the
inclusion of this provision (or any similar provision which would
otherwise address and change the effect of state escheat laws) in
a certificate of incorporation.
Appraisal Rights. Under Delaware law, a stockholder has
appraisal rights in connection with most types of mergers and
consolidations. Appraisal rights are not available to
(i) stockholders of a surviving corporation whose vote is not
required to approve the merger or consolidation or
(ii) stockholders of any class of stock listed on a national
securities exchange or held of record by over 2,000 stockholders,
unless such stockholders are required in the merger to accept in
exchange for their shares consideration other than shares of the
surviving corporation, shares of another listed corporation or a
corporation whose shares are held by over 2,000 stockholders,
cash in lieu of fractional shares of such corporations, or any
combination thereof.
Procedurally, Delaware law requires only that a dissenting
stockholder file a written demand for appraisal with the
corporation before the vote on the transaction and that such
stockholder not vote in favor of the merger or consolidation.
Thereafter, within 120 days of the effective date of the merger
or consolidation, either the surviving corporation or a
dissenting stockholder may file a petition in the Court of
Chancery demanding a determination of the fair value of the
shares of all dissenting stockholders, although at any time
within 60 days after the effective date of the transaction any
stockholder has the right to withdraw his demand and accept the
terms offered in the transaction. Lastly, under Delaware law,
the certificate of incorporation may provide that appraisal
rights shall be available for an amendment to the certificate of
incorporation and for the sale of all or substantially all of the
corporation's assets. The Current Charter does not provide for
appraisal rights in either such event.
Under Louisiana law, a shareholder has the right to dissent
from most types of merger or consolidation, or from the sale,
lease, exchange or other disposition of all or substantially all
of the corporation's assets, if such transaction is approved by
less than 80% of the corporation's total voting power. The right
to dissent is not available in the case of sales pursuant to an
order of a court or sales for cash on terms requiring
distribution of all or substantially all of the net proceeds to
the shareholders in accordance with their respective interests
within one year after the date of the sale. Moreover, no
dissenters rights are available with respect to (i) shareholders
holding shares of any class of stock which are listed on a
national securities exchange, unless the articles of
incorporation of the corporation issuing such stock provide
otherwise or the shares of such shareholders are not converted
solely into shares of the surviving corporation, or (ii)
shareholders of a surviving corporation whose approval is not
required in connection with a merger.
Procedurally, to exercise his dissenter's rights under
Louisiana law a shareholder must initiate three actions. First,
he must file a written objection to the proposed transaction
prior to or at the meeting at which the transaction is to be
considered. Second, he must vote his shares against the
transaction. Third, within twenty days of the mailing of a
notice from the surviving corporation that the transaction was
approved by less than 80% of the total voting power, he must make
a written demand for the payment of the fair cash value of his
shares as of the day before such vote and at the same time
deposit in escrow the certificates representing his shares. This
demand may be withdrawn at any time prior to the time of the
corporation's response, but may only be withdrawn with the
consent of the corporation thereafter. If the surviving
corporation and the shareholder cannot agree as to the fair cash
value of the shares, the shareholder may file suit to recover
such cash value in the Louisiana district court of the parish in
which the surviving corporation has its registered office.
Removal of Directors. Under Delaware law, any director may
be removed with or without cause by the holders of a majority of
shares entitled to vote at an election of directors. Similarly,
the New By-laws provide that any director may be removed at any
time by the vote of a majority of the voting power present at a
shareholders' meeting duly called for that purpose.
Other Differences in Rights. Set forth below is a
description of certain other material differences between the
rights of stockholders of the Louisiana Corporation and PHI.
Inspection Rights. Under Delaware law, upon written demand
made under oath for a proper purpose, any stockholder has the
right to inspect the corporation's stock ledger, a list of its
stockholders and its other books and records. If after five
business days the corporation fails to reply or refuses to comply
with such a request, the stockholder may apply to the Court of
Chancery to compel compliance.
Under Louisiana law, upon five days' written notice, any
shareholder, except a business competitor, who has been the
holder of record of at least 5% of the outstanding shares of any
class of the corporation for a minimum of six months has the
right to examine the records and accounts of the corporation for
any proper and reasonable purpose. Two or more shareholders who
have each held shares for a six-month period may aggregate their
stock holdings to attain the required 5% threshold. Business
competitors, however, must have owned at least 25% of all
outstanding shares for a minimum of six months to obtain such
inspection rights.
Voting by Proxy. As provided under Louisiana law, the New
Charter provides that directors may vote by proxy. Under
Delaware law, there is no similar provision.
Under both Delaware and Louisiana law, stockholders may vote
by proxy. Under Delaware law, stockholder proxies are valid for
three years or such longer period as specified therein. Under
Louisiana law, shareholder proxies are valid for eleven months or
such longer period up to three years as specified therein.
Changes in the Size and Composition of the Board of
Directors. Both the Current By-laws and the New By-laws fix the
number of directors at four provided that if after proxy
materials for any stockholders' meeting at which directors are to
be elected are mailed to stockholders and a director nominee
becomes unable or unwilling to serve, the number of authorized
directors is automatically reduced unless the Board selects an
additional nominee.
The Current By-laws empower PHI's Board to fill by a
majority vote any vacancy on the Board. Under the New By-laws,
any vacancy on the Board (including any vacancy resulting from an
increase in the authorized number of directors or the failure of
the shareholders to elect the full number of authorized
directors) may be filled by the vote of a majority of the entire
Board. The Louisiana Corporation's shareholders will also have
the right to fill any such vacancy at any special shareholders
meeting duly called for such purpose prior to the time the
vacancy is filled by the Board.
Unlike Delaware law, Louisiana law expressly provides that a
board of directors may declare vacant the office of a director if
he is interdicted or adjudicated an incompetent, is adjudicated a
bankrupt or becomes incapacitated by illness or other infirmity
and cannot perform his duties for a period of six months or
longer.
Restrictions on Taking Stockholder Action. Under the
Delaware law, a special meeting of stockholders may be called by
the board of directors or by such other person as may be
authorized by the certificate of incorporation or by-laws. Under
the Current By-laws, a special meeting of PHI stockholders may be
called by the Chairman of the Board, the President, a majority of
the Board, or stockholders of record owning shares entitled to a
majority of PHI's voting interest. Under Louisiana law, special
meetings of shareholders may be called by the President, board of
directors, or any shareholder or shareholders owning in the
aggregate 20% (or such lesser or greater proportion as provided
in the articles of incorporation or in the by-laws) of the total
voting power. Under the New Charter and New By-laws, special
shareholder meetings may be called by the Chairman of the Board,
Chief Executive Officer and President, the board of directors or
shareholders owning in the aggregate 40% of the total voting
power of the Louisiana Corporation.
Advance Notice of Shareholder Nominees. The New By-laws
require certain notice procedures for a shareholder to nominate a
person for director. Specifically, a shareholder's notice of
nomination must be delivered or mailed and received at the
principal executive offices of the Louisiana Corporation not less
than 45 days nor more than 90 days prior to the meeting unless
less than 55 days notice or prior public disclosure of the
meeting date is given, then the shareholder's notice must be
receive on the 10th day following the day on which notice of the
meeting date was mailed or such public disclosure was made. The
shareholder's notice must include certain specified information
about himself and the person the shareholder proposes to nominate
for election or re-election as a director. The Current By-laws
do not include a similar provision.
Federal Income Tax Considerations
PHI intends to treat the Merger for federal income tax
purposes as a reorganization under Section 368(a)(1)(F) of the
Internal Revenue Code of 1986, as amended, and, accordingly, PHI
will recognize no taxable income or loss as a result thereof.
Furthermore, the stockholders of PHI should recognize no gain
or loss on the exchange of their shares in PHI for shares of the
Louisiana Corporation and the tax basis in and the holding
period (provided that the shares of PHI are held by such
exchanging stockholder as a capital asset) of each such
stockholder's shares in the Louisiana Corporation will be the
same as the tax basis in and holding period of such stockholder
in the shares of PHI exchanged therefor.
The foregoing description of certain federal income tax
aspects of the Merger is based on Internal Revenue Code of 1986,
as amended, the regulations promulgated thereunder, published
revenue rulings and cases in effect at the date of this Proxy
Statement. There can be no assurance that future changes in the
foregoing precedents will not adversely affect the tax
consequences discussed herein or that there will not be
differences of opinion as to the interpretation of such
precedents. Accordingly, PHI's stockholders should consult their
own advisors as to the tax treatment which may be anticipated to
result from the transactions contemplated hereby regarding their
particular circumstances, including the application of state and
local laws.
Vote Required and Recommendation for Approval
PHI's Board has unanimously approved the Reincorporation
Proposal and the Merger Agreement. Under Delaware law, the
affirmative vote of the holders of a majority of the outstanding
shares of the Voting Common Stock is required for approval of the
Merger Agreement, pursuant to which the Reincorporation will be
effected. As of the Record Date, Carroll W. Suggs, PHI's
Chairman of the Board and Chief Executive Officer, beneficially
owned 1,889,888 shares of Voting Common Stock representing
approximately 57.7% of PHI's total voting power. See "Security
Holdings of Directors, Executive Officers and Certain Beneficial
Owners." Mrs. Suggs has advised PHI that she will vote her
shares of Voting Common Stock for the adoption of the
Reincorporation Proposal and the Merger Agreement and,
accordingly, approval is assured.
A vote in favor of the Reincorporation Proposal and Merger
Agreement will constitute specific approval of all other
transactions associated with the Merger, including the assumption
by the Louisiana Corporation of all obligations of PHI and the
change in the rights of stockholders resulting from the Merger,
including limitation of liability and indemnification of
directors and officers. The enclosed form of proxy provides the
means for stockholders to vote for or against (or to abstain from
voting with respect to) the Reincorporation Proposal and Merger
Agreement. Each properly executed proxy received prior to the
Annual Meeting will be voted as specified therein. If a
stockholder executes and returns a proxy, but does not specify
how his or her shares are to be voted, the shares represented by
such stockholder's proxy will be voted for the adoption of the
Reincorporation Proposal and the Merger Agreement.
The Board of Directors unanimously recommends a vote FOR the
Reincorporation Proposal and Merger Agreement.
SECURITY HOLDINGS OF DIRECTORS, EXECUTIVE OFFICERS
AND CERTAIN BENEFICIAL OWNERS
Security Holdings of Directors and Executive Officers
The following table sets forth certain information
concerning the beneficial ownership of each class of outstanding
PHI equity securities by each director and nominee of PHI, by
each executive officer for whom compensation information is
disclosed under the heading "Summary of Executive Compensation,"
and by all directors and executive officers of PHI as a group as
of the Record Date, determined in accordance with Rule 13d-3 of
the Securities and Exchange Commission ("SEC"). Unless otherwise
indicated, the equity securities shown are held with sole voting
and investment power.
Class of
PHI Number
Name of Beneficial Common of Percent
Owner Stock Shares of Class
__________________ ________ ______ ________
Nominees:
________
Leonard M. Horner Non-Voting 100 *
Robert G. Lambert Voting 1,000 *
Robert E. Perdue Non-Voting 1,000 *
Carroll W. Suggs Voting 1,889,888<FN1> 57.7
Named Executive
Officers:<FN2>
Robert D. Cummiskey, Jr. -- -- --
Ben Schrick Voting 560 *
John H. Untereker -- -- --
A. Byron Elliott<FN3> Voting 20,300 *
Non-Voting 1,000 *
All Directors and
Executive Officers
as a Group <FN4> Voting 1,890,448 57.7
Non-Voting 1,100 *
_____________________
* Less than one percent.
<FN1> Mrs. Suggs shares voting and investment power over
441,693 of these shares, of which (a) 413,308 shares
are owned of record by ONI International, Inc., a
corporation controlled by Mrs. Suggs and whose board of
directors (of which she is a member) shares voting and
investment power over these shares, (b) an aggregate of
26,235 shares are held by Mrs. Suggs as custodian for
the benefit of her three children and (c) an aggregate
of 2,150 shares are owned by her three children.
<FN2> Information for Mrs. Suggs appears in this table under
the heading "Nominees."
<FN3> Mr. Elliott retired in August 1993.
<FN4> Includes 12 persons, excluding Mr. Elliott.
_____________________
Security Holdings of Certain Beneficial Owners
As of the Record Date, the persons named below were, to
PHI's knowledge, the only beneficial owners of more than 5% of
PHI's outstanding Voting Common Stock, determined in accordance
with Rule 13d-3 of the SEC. Unless otherwise indicated, all
shares are held with sole voting and investment power.
Amount and
Nature of
Beneficial Percent
Name and Address Ownership of of
of Beneficial Owner PHI Voting Stock Class
___________________ ________________ _____
Carroll W. Suggs
5728 Jefferson Highway
New Orleans, Louisiana 70183 1,889,888<FN1> 57.7
ONI International, Inc.
5728 Jefferson Highway
New Orleans, Louisiana 70183 413,308<FN2> 12.6
______________________
<FN1> Includes 441,693 shares as to which Mrs. Suggs shares voting
and investment power. See note (1) under "- Security
Holdings of Directors and Executive Officers." Of such
shares, 413,308 are also reported as beneficially owned by
ONI International, Inc.
<FN2> Also reported as beneficially owned by Mrs. Suggs. Mrs.
Suggs controls ONI International, Inc. and shares voting and
investment power with respect to these shares with the other
members of the board of directors of ONI International, Inc.
____________________
EXECUTIVE AND DIRECTOR COMPENSATION; CERTAIN TRANSACTIONS
Summary of Executive Compensation
The following table summarizes, for each of the fiscal years
ended April 30, 1994, 1993 and 1992, compensation of PHI's Chief
Executive Officer and each other executive officer of PHI whose
annual compensation was in excess of $100,000 in all capacities
in which they served:
<TABLE>
<CAPTION>
Long-Term
Compensation
Awards:
No. of
Annual Compensation Options All Other
Granted<FN1> Compensation<FN2>
Year Salary ___________ _______________
____ ______
Name and
Principal Position
__________________
<S> <C> <C> <C> <C>
Carroll W. Suggs 1994 $308,271 0 $ 7,023
Chairman of the Board and 1993 285,000 0 8,550
Chief Executive Officer 1992 276,484 0 7,923
Robert D. Cummiskey, Jr. 1994 103,393 6,000 3,094
Vice President of 1993 92,929 0 8,994
Risk Management and Secretary 1992 51,746 0 0
Ben Schrick 1994 105,762 9,000 3,165
Vice President and 1993 82,065 0 8,994
General Manager 1992 75,000 0 8,728
John H. Untereker 1994 200,978 0 6,021
Vice President and Chief 1993 152,728 15,000 53,970<FN4>
Financial Officer <FN3> 1992 -- -- --
A. Byron Elliott 1994 244,418 0 11,846<FN6>
Former Vice Chairman 1993 245,308 0 137,729<FN7>
of the Board <FN5> 1992 -- -- --
____________________
</TABLE>
<FN1> For additional information, please refer to the two tables
below.
<FN2> Unless otherwise indicated, reflects amounts paid by PHI on
behalf of the named executive officer pursuant to the
Petroleum Helicopters, Inc. 401(k) Retirement Plan.
<FN3> Mr. Untereker has been employed as an executive officer of
PHI since July 1992.
<FN4> Includes $28,000 paid to Mr. Untereker in connection with
his recruitment and $23,943 paid by PHI in reimbursement of
Mr. Untereker's relocation expenses.
<FN5> Mr. Elliott retired in August 1993. Prior to July 1992, Mr.
Elliott was a consultant and non-employee director of PHI.
<FN6> Includes $7,500 paid to Mr. Elliott for relocation expenses.
<FN7> Includes $85,000 paid to Mr. Elliott for consulting services
and $50,000 paid by PHI in connection with commencement of
Mr. Elliott's employment and relocation.
1994 Stock Option Grants
The following table contains information concerning the
grant of stock options to the named executive officers during the
fiscal year ended April 30, 1994:
<TABLE>
<CAPTION>
Potential
% of Total Realizable Value of
Options Options at Assumed
No. of Granted to Annual Rates of Stock
Options Employees in Exercise Expiration Price Appreciation
Name Granted Fiscal 1994 Price Date For Option Term
__________________ _______ ____________ ________ __________ _____________________
5% 10%
_____________
<S> <C> <C> <C> <C> <C> <C>
Carroll W. Suggs 0 -- -- -- -- --
Robert D. Cummiskey, Jr. 6,000<FN1> 7% $15.50 June 2, 1998 $25,694 $56,777
Ben Schrick 9,000<FN1> 11% $15.50 June 2, 1998 $38,541 $85,166
John H. Untereker 0 -- -- -- -- --
A. Byron Elliott 0 -- -- -- -- --
_________________
</TABLE>
<FN1> These options to acquire Non-Voting Common Stock were
awarded at the fair market value of shares on the effective
date of grant. The options become exercisable annually in
one-third increments beginning on June 2, 1994 and expire on
June 2, 1998.
Option Exercises and Holdings
The following table sets forth information with respect to
the named executive officers concerning the exercise of options
during 1994 and unexercised options held as of April 30, 1994:
<TABLE>
<CAPTION>
Shares
Acquired Value of Unexercised
on Number of Unexercised in-the-Money Options at
Name Exercise Value Realized Options at April 30, 1994 April 30, 1994 <FN3>
____ ________ ______________ ___________________________ ___________________________
Exercisable Unexercisable Exercisable Unexercisable
___________ ______________ ___________ _____________
<S> <C> <C> <C> <C> <C> <C>
Carroll W. Suggs -- -- -- -- -- --
Robert D. Cummiskey, Jr. 0 0 0 6,000<FN1> 0 0
Ben Schrick 0 0 0 9,000<FN1> 0 0
John H. Untereker 0 0 0 15,000<FN2> 0 0
A. Byron Elliott -- -- -- -- -- --
________________
</TABLE>
<FN1> These options were granted and are exercisable on terms
as described in the note of the preceding table.
<FN2> The option to acquire Voting Common Stock was awarded
at fair market value of the shares on the effective date
of grant. The option becomes exercisable annually in
one-third increments beginning on July 20, 1994 and expires
on July 20, 1998.
<FN3> Reflects the difference between the average of the bid and
asked prices of the Voting Common Stock on April 30, 1994
and the exercise price of the options.
Compensation Committee Interlocks and Insider
Participation
The Board maintains a Finance, Audit and
Compensation committee on which Messrs. Perdue and
Horner serve (the "Committee"). Neither member of the
Committee has been an officer or employee of PHI or any
of its subsidiaries.
Employment Agreements
Mr. Untereker and PHI entered into an agreement in
July 1992 pursuant to which PHI agreed to pay Mr.
Untereker an amount equal to his base salary for six
months and certain relocation expenses in the event of
the termination of his employment. PHI also agreed to
pay Mr. Untereker an amount equal to his annual cash
compensation for the most recent fiscal year in the
event of termination due to a change in control of PHI
during the first five years of his employment.
Compensation Committee's Report on Executive
Compensation
General. The Committee was formed in July 1992 to
oversee all compensation arrangements for directors,
executive officers, currently numbering 12, and other
employees, and administer PHI's 1992 Non-Qualified
Stock Option and Stock Appreciation Rights Plan (the
"Plan"). The Committee is composed entirely of Board
members who are not employees of PHI. The Committee
retained an outside consultant in fiscal 1993 to assist
it in obtaining relevant information on pay practices
at comparable organizations, and in developing
compensation programs that are consistent with the
Committee's compensation philosophy and objectives.
The Committee's overall policy regarding executive
compensation is to ensure PHI's compensation programs
will provide competitive salary levels and long term
incentives that attract and retain individuals of high
quality and ability, promote individual recognition for
favorable performance by PHI relative to comparable
companies, and support the short and long range
business objectives and strategies of PHI.
The Company's executive compensation consists of
two principal components: salary and stock based
compensation.
Salary. In fiscal 1993, an outside consultant was
retained primarily to develop a range of salaries
consistent with salaries paid for similar positions at
comparable publicly-held companies. For these
purposes, a sample of companies was selected from the
oilfield services industry based on total revenues and
number of employees. Salaries paid by certain
companies that are part of the oil field service index
included in the graph set forth under the heading
"Performance Graph," below, were among those
considered. Because certain of these companies had
either revenues or total employees substantially
exceeding those of PHI, salaries of PHI executives
remain at the lower end of the ranges. In fiscal 1994
compensation decisions were made by the Chief Executive
Officer and the Committee, except in the case of the
Chief Executive Officer whose performance was
evaluated, and salary established, by the Committee.
Compensation decisions are generally based on PHI
financial performance, although other factors
indicative of the individual executive's contribution
to corporate objectives are also considered.
Stock Option Grants. In June 1993, options to
acquire 81,000 shares of Non-Voting Common Stock were
granted to certain executive officers pursuant to the
Plan. Mr. Cummiskey received 6,000 options and Mr.
Schrick received 9,000 options. See "- 1994 Stock
Option Grants" and "- Option Exercises and Holdings."
The number of options awarded to an executive was based
on the executive's level of responsibility. All
options were granted at fair market value and
accordingly only become valuable to the executive to
the extent PHI's stock value increases. It is
anticipated that additional options will be granted
pursuant to the Plan periodically in the future to
promote a longer term perspective and commitment by
executives and to maximize stockholder value by linking
the financial interests of management and stockholders.
Compensation of the Chief Executive Officer.
During fiscal 1994, Mrs. Suggs received an
approximately 11% base salary increase based primarily
on PHI's improved earnings during fiscal 1993 and
related financial trends, as well as the additional
responsibility Mrs. Suggs undertook in fiscal 1993 as
Chief Executive Officer and the sole Chairman of the
Board. Also considered was the fact that no salary
increase, performance bonus or stock options were
awarded to Mrs. Suggs during fiscal 1993.
The Committee believes that the compensation of
the chief executive officer and other executive
officers is competitive with, or below the comparable
companies described more fully above, but is consistent
with the Committee's policy of providing an appropriate
balance between short and long range individual and
corporate performance.
By the members of the Finance, Audit and
Compensation Committee.
Leonard M. Horner, Chairman Robert E. Perdue
Performance Graph
The graph below compares the cumulative total
stockholder return on the Voting Common Stock for the
last five years with the cumulative total return on the
Russell 2000 Index and the Oil Field Services Index
published by Media General Financial Services, Inc.,
assuming the investment of $100 on May 1, 1989 at
closing prices on April 30, 1989 and reinvestment of
dividends. The Russell 2000 Index consists of a broad
range of publicly-traded companies with smaller market
capitalizations and is published daily in the Wall
Street Journal. The Oil Field Service Index consists
of 41 oil field service companies and is published
weekly in the Houston Chronicle.
Cumulative Total Return as of April 30:
______________________________________________
Index 1989 1990 1991 1992 1993 1994
_____ ____ ____ ____ ____ ____ ____
PHI 100 184.2 133.6 84.8 110.8 76.1
Russell 2000 100 96.0 103.6 119.2 135.2 153.3
Oil Field Service Index 100 122.4 113.5 94.8 100.3 94.0
____________________
Note:Management believes that the following events,
each of which were unrelated to PHI's operating
performance, significantly affected the return on
Voting Common Stock between May 1, 1989 and April
30, 1991: (i) the death, in September 1989, of
Robert L. Suggs, founder and principal stockholder
of PHI, (ii) an unsolicited tender offer for the
Voting Common Stock in August 1990, and (iii) the
acquisition by PHI of an aggregate of 633,490
shares of Voting Common Stock at a price of $28.05
per share in October 1990.
____________________
Director Compensation
Each director who is not an employee of PHI
receives a fee of $1,000 for each Board or Committee
meeting he attends, and each director who is also an
employee of PHI receives a fee of $300 for each Board
or Committee meeting she attends.
Certain Other Transactions
PHI paid ONI International, Inc. $88,599 for
office space and services related to PHI's New Orleans
offices, which PHI believes represents the fair market
value of such office space and services. ONI
International, Inc. is controlled by Mrs. Suggs and
beneficially owns approximately 12.6% of the Voting
Common Stock.
During the 1994 fiscal year, PHI paid Aviall, Inc.
approximately $10.7 million for parts and component
repair services, which PHI believes represents the fair
market value of such parts and services. Mr. Lambert,
a director of PHI since July 1994 and a nominee for
director at the Meeting, has been the Chairman of the
Board of Directors of Aviall, Inc. since December 1993.
Mr. Lambert was not appointed to PHI's Board until
after Aviall, Inc. entered into an agreement to sell to
an unrelated third party the division of its business
that provides substantially all of such parts and
services to PHI. It is anticipated that sales by
Aviall, Inc. to PHI will decrease significantly in 1995
and thereafter because of the pending sale.
RELATIONSHIP WITH INDEPENDENT
PUBLIC ACCOUNTANTS
PHI's consolidated financial statements for the
year ended April 30, 1994 were audited by the firm of
KPMG Peat Marwick, which firm will remain as PHI's
auditors until replaced by the Board upon the
recommendation of the Committee. Representatives of
KPMG Peat Marwick are expected to be present at the
Meeting, with the opportunity to make any statement
they desire at that time, and will be available to
respond to appropriate questions.
As a result of changes in its operating and
financial management personnel, during fiscal 1993 PHI
undertook an evaluation of its relationships with
professional service firms. As a result of that
process, the Committee selected Coopers & Lybrand to
replace Deloitte & Touche as PHI's principal
independent accountants effective December 18, 1992.
Subsequently the Board and its Committee selected KPMG
Peat Marwick to replace Coopers & Lybrand as its
principal independent accountants, effective March 31,
1993. During the interim period preceding March 31,
1993, there were no disagreements with Coopers &
Lybrand or Deloitte & Touche on any matters of
accounting principles or practice, financial statement
disclosure, or auditing scope or procedure, which, if
not resolved to the satisfaction of Coopers & Lybrand
or Deloitte & Touche, would have caused either firm to
make reference to the subject matter of the
disagreement in connection with its report.
OTHER MATTERS
Quorum and Voting of Proxies
The presence, in person or by proxy, of a majority
of the outstanding shares of Voting Common Stock is
necessary to constitute a quorum. Stockholders voting,
or abstaining from voting, by proxy on any issue will
be counted as present for purposes of constituting a
quorum. If a quorum is present, the election of
directors will be determined by plurality vote and the
affirmative vote of the holders of a majority of the
outstanding shares of the Voting Common Stock will be
required for the approval of the Reincorporation
Proposal and Merger Agreement.
A broker or nominee holding shares registered in
its name, or in the name of its nominee, that are
beneficially owned by another person and for which it
has not received instructions as to voting from the
beneficial owner has the discretion to vote the
beneficial owner's shares will respect to the election
of directors but not with respect to the
Reincorporation Proposal and Merger Agreement.
Because directors are elected by plurality vote,
withholding authority to vote in such election will not
affect whether the proposed nominees named herein are
elected. However, because the affirmative vote of the
holders of a majority of the outstanding shares of the
Voting Common Stock is required for the approval of the
Reincorporation Proposal and Merger Agreement, an
abstention or a "non-vote" with respect thereto will
effectively count as a vote against such action.
PHI does not know of any matters to be presented
at the Meeting other than those described herein.
However, if any other matters properly come before the
Meeting, it is the intention of the persons named in
the enclosed proxy to vote the shares represented by
them in accordance with their best judgment.
Stockholder Proposals
Eligible stockholders who desire to present a
proposal qualified for inclusion in the proxy materials
relating to the 1995 annual meeting of PHI must forward
such proposals to the Secretary of PHI at the address
listed on the first page of this Proxy Statement in
time to arrive at PHI prior to April 27, 1995.
By Order of the Board of Directors
/s/ Robert D. Cummiskey, Jr.
Robert D. Cummiskey, Jr.
Secretary
New Orleans, Louisiana
August 25, 1994
<PAGE>
Exhibit A
ARTICLES OF INCORPORATION
of
PETROLEUM HELICOPTERS, INC.
ARTICLE I
Name
The name of the corporation is Petroleum Helicopters, Inc.
(the "Corporation").
ARTICLE II
Purpose
The Corporation's purpose is to engage in any lawful
activity for which corporations may be formed under the Business
Corporation Law of Louisiana.
ARTICLE III
Capital
A. The Corporation is authorized to issue 12,500,000
shares of voting common stock, par value $.10 per share (the
"Voting Common Stock"), 12,500,000 shares of non-voting common
stock, par value $.10 per share (the "Non-Voting Common Stock"),
and 10,000,000 shares of preferred stock, no par value per share
(the "Preferred Stock").
B. Each share of Voting Common Stock shall entitle the
holder thereof to one vote with respect to such share of Voting
Common Stock on each matter properly submitted to the
Corporation's shareholders for their vote, consent, waiver,
release or other action. Unless otherwise required by law,
holders of the Non-Voting Common Stock shall not be entitled to
any voting rights. Except with respect to voting rights, each
share of Voting Common Stock and Non-Voting Common Stock shall be
identical in all other respects.
C. Shares of Preferred Stock may be issued from time to
time in one or more series. Authority is hereby vested in the
Corporation's board of directors (the "Board"), subject to
Article IV, to amend these articles of incorporation from time to
time to fix the preferences, limitations and relative rights as
among the shares of Preferred Stock, Voting Common Stock and Non-
Voting Common Stock, and to establish and fix variations in the
preferences, limitations and relative rights as between different
series of Preferred Stock.
ARTICLE IV
Voting of Shareholders
A. The affirmative vote of the holders of a majority of
the total voting power of the Corporation shall decide any matter
properly brought before a shareholders' meeting duly organized
for the transaction of business unless by express provision of
law or these Articles of Incorporation a different vote is
required, in which case such express provision shall govern.
Directors shall be elected by plurality vote.
B. (1) For purposes of this paragraph B, the following
terms shall have the meanings specified below:
"Beneficial Ownership," "Beneficially
Owned," or "Beneficially Own" refers to
beneficial ownership as defined in Rule 13d-3
(without regard to the 60-day provision in
paragraph (d)(1)(i) thereof) promulgated by
the Securities and Exchange Commission as
such rule may be amended from time to time.
"FAA" means the Federal Aviation
Administration.
"Non-Citizen Owned Shares" means any
issued and outstanding Voting Securities that
are owned of record, Beneficially Owned, or
otherwise controlled by any Person or Persons
who are not United States Citizens.
"Permitted Percentage" means one percent
less than the percentage of the voting
interest in the Corporation that may be owned
or controlled by Persons who are not United
States Citizens without loss, under Section
1301(16) of Title 49 of the United States
Code or any successor or other applicable law
or regulation, of the United States Citizen
status of the Corporation or any Subsidiary.
"Person" means any individual,
corporation, partnership, trust or other
entity of any nature whatsoever.
"Subsidiary" means any corporation of
which a majority of any class of equity
security is owned, directly or indirectly, by
the Corporation.
"United States Citizen" means any Person
who is a Citizen of the United States as
defined in Section 1301(16) of Title 49 of
the United States Code, as in effect on the
date in question, or any successor statute or
regulation.
"Voting Securities" means the Voting
Common Stock, any other voting stock of the
Corporation, and any bonds, debentures or
similar obligations granted voting rights by
the Corporation.
(2) The Corporation holds an operating
certificate issued by the FAA pursuant to the
regulations promulgated under the Federal Aviation Act
of 1958, as amended, and the Board and shareholders
deem the retention of the Corporation's rights under
such certificate to be of material importance to the
Corporation. As long as the Corporation holds, or the
Board deems it desirable for the Corporation to hold,
its current operating certificate or any other
certificate issued by the FAA pursuant to the Federal
Aviation Act of 1958, as amended, and the regulations
promulgated thereunder or any successor statute or
regulation, it shall be the Corporation's policy that
the number of Non-Citizen Owned Shares shall not exceed
the Permitted Percentage.
(3) If at any time the voting interest of Non-
Citizen Owned Shares exceeds the Permitted Percentage,
then (i) the voting power otherwise attributable to
each Non-Citizen Owned Share shall be immediately and
automatically reduced on a pro rata basis (based on the
proportion of the voting power otherwise attributable
to such Non-Citizen Owned Share to the total voting
power attributable to all Non-Citizen Owned Shares)
without any further action by the Corporation so that
the maximum number of votes that may be cast by the
holders of all Non-Citizen Owned Shares shall equal the
Permitted Percentage and (ii) the total voting power of
any affected class or series of Voting Securities shall
also be immediately and automatically reduced without
any further action by the Corporation by the total
number of votes by which the voting power of Non-
Citizen Owned Shares of such class or series was
reduced pursuant to clause (i) of this subparagraph
(3).
(4) In determining the citizenship of any Person
who Beneficially Owns Voting Securities, the
Corporation may rely on the Corporation's stock
transfer records and the citizenship provided by any
Person shown as the Record Owner and any Person who the
Corporation has reasonable cause to believe
Beneficially Owns such voting securities. The Board
may establish procedures to monitor the Beneficially
Ownership and control of Voting Securities, to make any
reasonable determination regarding the Beneficial
Ownership and control of Voting Securities, and to take
any actions deemed necessary or desirable to ensure
that the voting interest of Non-Citizen Owned Shares
does not exceed the Permitted Percentage. The Board
may, but unless expressly provided otherwise is not
required to, rely on any statutes, regulations,
policies, procedures, rulings, or determinations of the
FAA, or any successor governmental authority, in
deciding the extent to which Voting Securities are
Beneficially Owned or controlled by United States
Citizens.
(5) The Corporation may by notice in writing
(which may be included in a proxy or ballot distributed
to the Corporation's shareholders) require any Person
that is a holder of record of Voting Securities or that
the Corporation has reasonable cause to believe
Beneficially Owns or controls Voting Securities to
certify in such manner as the Corporation shall deem
appropriate (including execution of a proxy or ballot)
that, to the knowledge of such Person:
(a) all Voting Securities owned of
record, Beneficially Owned, or controlled by
such Person are owned and controlled only by
United States Citizens; or
(b) the number and class or series of
Non-Citizen Owned Shares owned of record,
Beneficially Owned, or controlled by such
Person are as set forth in such certificate.
The Corporation may require any Person certifying as to
the ownership or control of Voting Securities in
response to clause (a) of this subparagraph (5) to
provide such further information as the Corporation may
reasonably request in order to implement the provisions
of this paragraph B. If any Person fails to provide
such certificate or other information, the Corporation
may presume that all such Voting Securities are Non-
Citizen Owned Shares.
C. Special meetings of the shareholders may be called at
any time by the Board or the officers of the Corporation as
provided in the Corporation's by-laws or upon the written request
of any shareholder or group of shareholders holding in the
aggregate at least 40% of the total voting power of the
Corporation. Upon receipt of such a shareholder request, the
Secretary shall call a special meeting of shareholders to be held
at the registered office of the Corporation at such time as the
Secretary may fix, not less than 15 nor more than 60 days after
the receipt of such request, and if the Secretary shall neglect
or refuse to fix such time or to give notice of the meeting, the
shareholder or shareholders making the request may do so. Such
request must state the specific purpose or purposes of the
proposed special meeting and the business to be conducted thereat
shall be limited to such purpose or purposes.
ARTICLE V
Directors
A. The Board shall consist of such number of persons as
shall be designated in the Corporation's by-laws. No decrease in
the number of directors shall shorten the term of any incumbent
director.
B. Any director absent from a meeting of the Board or any
committee thereof may be represented by any other director, who
may cast the vote of the absent director according to the written
instructions, general or special, of the absent director.
ARTICLE VI
Limitation of Liability and Indemnification
A. To the fullest extent permitted by the Business
Corporation Law of Louisiana, no director or officer of the
Corporation shall be liable to the Corporation or to its
shareholders for monetary damages for breach of his fiduciary
duty as a director or officer.
B. The Board may (1) cause the Corporation to enter into
contracts with directors and officers providing for the
limitation of liability set forth in this Article VI and for
indemnification of directors and officers to the fullest extent
permitted by law, (2) adopt by-laws or resolutions providing for
indemnification of directors, officers and other persons to the
fullest extent permitted by law and (3) cause the Corporation to
exercise the powers set forth in La.R.S. 12:83F, notwithstanding
that some or all of the members of the Board acting with respect
to the foregoing may be parties to such contracts or
beneficiaries of such by-laws or resolutions.
C. No amendment or repeal of any by-law or resolution
relating to indemnification shall adversely affect any person's
entitlement to indemnification whose claim thereto results from
conduct occurring prior to the date of such amendment or repeal.
D. Any amendment or repeal of this Article VI shall not
adversely affect any elimination or limitation of liability of a
director or officer of the Corporation under this Article VI with
respect to any action or inaction occurring prior to the time of
such amendment or repeal.
ARTICLE VII
Reversion
Cash, property or share dividends, shares issuable to share-
holders in connection with a reclassification of stock, and the
redemption price of redeemed shares, which are not claimed by the
shareholders entitled thereto within one year after the dividend
or redemption price became payable or the shares became issuable,
despite reasonable efforts by the Corporation to pay the dividend
or redemption price or deliver the certificates for the shares to
such shareholders within such time, shall, at the expiration of
such time, revert in full ownership to the Corporation, and the
Corporation's obligation to pay such dividend or redemption price
or issue such shares, as the case may be, shall thereupon cease;
provided that the Board may, at any time, for any reason
satisfactory to it, but need not, authorize (A) payment of the
amount of any cash or property dividend or redemption price or
(B) issuance of any shares, ownership of which has reverted to
the Corporation pursuant to this Article VII, to the persons or
entity who or which would be entitled thereto had such reversion
not occurred.
ARTICLE VIII
Incorporator
The name and post office address of the incorporator is:
Robert D. Cummiskey, Jr.
Petroleum Helicopters, Inc.
5728 Jefferson Highway
New Orleans, Louisiana 70123
<PAGE>
PETROLEUM HELICOPTERS, INC.
Proxy Solicited on Behalf of the Board of Directors
for the Annual Meeting of Stockholders on September 28, 1994
The undersigned hereby appoints Carroll W. Suggs and Leonard
M. Horner, or either of them, proxies for the undersigned,
with full power of substitution, to vote all shares of Voting
Common Stock of Petroleum Helicopters, Inc. ("PHI") that the
undersigned is entitled to vote at the annual meeting of
stockholders to be held September 28, 1994, and any
adjournments thereof.
1. Election of Directors, Nominees:
Carroll W. Suggs, Leonard M. Horner, Robert E. Perdue,
Robert G. Lambert.
2. Proposal to change PHI's state of incorporation from the
State of Delaware to the State of Louisiana (the
"Reincorporation Proposal") by adopting an Agreement of
Merger dated August 25, 1994 (the "Merger Agreement").
Please specify your choices by marking the appropriate boxes on
the reverse side. IF NO SPECIFIC DIRECTIONS ARE GIVEN, THIS
PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2. YOUR SHARES CANNOT BE
VOTED UNLESS YOU SIGN, DATE AND RETURN THIS PROXY.
x Please mark your
votes as in this
example.
To withhold authority to vote for any individual nominee(s) mark the
FOR box in proposal 1 and write that nominees's name(s) on the
space provided below the boxes.
The Board of Directors recommends a vote for Proposals
1 and 2.
FOR WITHHELD FOR WITHHELD
1. Election of 2. Reincorporation
Directors. Proposal and the
(see reverse) Merger Agreement
FOR, except vote 3. In their discretion, to transact
WITHHELD from the following such other business as may
nominee(s): properly come before the meeting
and any adjoumments thereof.
____________________________
Check this box to note
change of address.
NOTE: Please sign exactly as name
appears hereon. When signing
as attorney, executor,
administrator, trustee, or
guardian, pelase give full
title as such. If a
corporation, please sign in
full corporate name by
president or other authorized
officer. If a partnership,
please sign in partnership
name by authorized persons.
The signer hereby revokes all authorizations
heretofore given by the signer to vote at the
meeting or any adjoumments thereof.
____________________________________________
____________________________________________
SIGNATURE(S) DATE
