SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14 (a) of the Securities
Exchange Act of 1934 (Amendment No. - )
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Section 240.14a - 12
PETROLEUM HELICOPTERS, INC.
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PETROLEUM HELICOPTERS, INC.
2121 Airline Highway
Suite 400
Metairie, Louisiana 70001
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 26, 2000
To the Holders of Voting Stock of Petroleum Helicopters, Inc.:
The 2000 Annual Meeting of Stockholders of Petroleum Helicopters, Inc.
("PHI") will be held at 2121 Airline Highway, Metairie, Louisiana, 6th
floor, on Friday, May 26, 2000, at 10:30 a.m., local time, to:
1. Elect directors.
2. Consider and vote upon a proposed amendment to the 1995 Incentive
Compensation Plan to increase the number of shares available
thereunder.
3. Transact such other business as may properly be brought before
the meeting or any adjournments thereof.
Holders of record of PHI's voting common stock at the close of
business on April 14, 2000, are entitled to notice of and to vote at the
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
April 28, 2000
PETROLEUM HELICOPTERS, INC.
2121 Airline Highway
Suite 400
Metairie, Louisiana 70001
PROXY STATEMENT
FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD
May 26, 2000
This Proxy Statement is furnished to holders of voting common stock
("Voting 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 (the
"Meeting") to be held on May 26, 2000, at the time and place set forth in
the accompanying notice and at any adjournments thereof.
Stockholders of record of Voting Stock at the close of business on
April 14, 2000, are entitled to notice of and to vote at the Meeting. On
that date, PHI had outstanding 2,793,386 shares of Voting Stock, each of
which is entitled to one vote.
The enclosed proxy may be revoked by the stockholder at any time prior
to its exercise 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
April 28, 2000. The cost of preparing and mailing proxy materials as well
as 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, fax, e-mail and telex. 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 six, 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 six 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 April 1,
2000, 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, 61 Chairman of the Board, 1989
President and Chief
Executive Officer of PHI(1)
Arthur J. Breault, Jr., 61 Tax lawyer and consultant(2) 1999
Leonard M. Horner, 73 Private Investments(3) 1992
James W. McFarland, 55 Dean, A.B. Freeman School 1996
of Business,
Tulane University(4)
Thomas H. Murphy, 45 Member, Murco Oil & Gas, LLC 1999
(oil & gas production and
investments)(5)
Bruce N. Whitman, 67 Executive Vice President and 1996
Director, Flight Safety Boeing
Training International, LLP
(aviation training and related
services) (6)
- --------------------------
(1) Mrs. Suggs is also a director of Varco International, Inc., Whitney
Holding Corporation and Global Marine, Inc.
(2) For more than 16 years before 1997, when he retired, Mr. Breault
was a partner in Deloitte & Touche, LLP, concentrating in tax matters.
(3) From 1974 to 1991, Mr. Horner served in various capacities with
Bell Helicopter Textron, Inc. (helicopter manufacturer), including
Chairman, President, Executive Vice President, Senior Vice President
Marketing and Programs and Vice President - Operations. Before 1974,
he was employed with United Technologies Corp. Sikorsky Aircraft
Division (helicopter manufacturer) for 17 years.
(4) Dean McFarland is also a director of American Indemnity Financial
Corporation, Sizeler Property Investors, Inc., and Stewart
Enterprises, Inc.
(5) For more than five years prior to 1998, Mr. Murphy was President of
Murco Drilling Corporation, a U.S. onshore oil and gas drilling
contractor.
(6) Mr. Whitman is also a director of Aviall, Inc., Flight Safety
Boeing Training International, LLC, and Megadata Corp.
--------------------
In 1999, PHI changed its fiscal year from one ending on April 30 to
one ending on December 31, resulting in an eight month transition period
ended December 31, 1999, referred to herein as the "Transition Period" or
"TP." During the Transition Period, the Board held four meetings. Each
incumbent director attended at least 75% of the aggregate number of Board
and Committee meetings of which he or she was a member.
The Board has an Audit Committee, the members of which are Messrs.
Horner, Whitman, Breault, McFarland and Murphy (Chairman). This committee,
which held two meetings during the Transition Period, is responsible for
making recommendations to the Board concerning the selection and retention
of independent auditors, reviewing the results of audits by the independent
auditors, discussing audit recommendations with management and reporting
the results of its reviews to the Board. The Board also has a Compensation
Committee, the members of which are Messrs. Breault, Horner, Whitman,
McFarland (Chairman) and Murphy. This committee, which held three meetings
during the Transition Period, is responsible for determining the
compensation of officers and key employees and administering PHI's
incentive compensation plans. The Board does not have a nominating
committee.
Each director receives an annual fee of $12,000 payable, in the case
of non-officer directors, in PHI Non-Voting Common Stock ("Non-Voting
Stock"), and a fee of $1,000 for each Board or Committee meeting he or she
attends. The PHI Directors Stock Compensation Plan permits each non-
officer Director to elect annually to defer the receipt of all or a
portion of the fees otherwise payable to him. The amount of deferred fees
bear interest at a rate equal to PHI's borrowing costs. The Plan also
provides that options are automatically granted on the annual stockholders
meeting date to each non-officer director to purchase up to 2,000 shares of
Non-Voting Stock at the fair market value on the date of grant. No option
will be exercisable more than ten years from the date of grant. A period
of two years continuous service on the Board is necessary before an option
will become exercisable.
STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning the
beneficial ownership of each class of outstanding PHI equity securities as
of April 1, 2000 by (a) each director and nominee for director of PHI, (b)
each executive officer identified under the heading "Executive
Compensation and Certain Transactions - Summary of Executive Compensation"
("Named Executive Officers") and (c) all directors and executive officers
of PHI as a group, determined in accordance with Rule 13d-3 of the
Securities and Exchange Commission (the "SEC"). Unless otherwise
indicated, the securities shown are held with sole voting and investment
power.
Class of PHI Number of Percent
Beneficial Owner Common Stock Shares(1)(4) of Class
- ---------------- ------------ ------------- --------
Directors and Nominees
Carroll W. Suggs Voting 1,452,260 (2) 51.5
Non-Voting 0 *
Arthur J. Breault, Jr. Voting 0 *
Non-Voting 1,277 *
Leonard M. Horner Voting 0 *
Non-Voting 1,277 *
James W. McFarland Voting 0 *
Non-Voting 3,350 *
Thomas H. Murphy Voting 600 *
Non-Voting 1,377 *
Bruce N. Whitman Voting 1,000 *
Non-Voting 1,277 *
Named Executive Officers (3)
Ben Schrick Voting 0 *
Non-Voting 12,624 *
William P. Sorenson Voting 0 *
Non-Voting 5,226 *
Kenneth A. Townsend Voting 0 *
Non-Voting 6,497 *
Michael J. McCann Voting 0 *
Non-Voting 3,000 *
All Directors and
Executive Officers Voting 1,453,860 (5) 51.5
as a Group (13 persons) Non-Voting 41,858 (6) 1.7
- ----------------------
* Less than one percent.
(1) Shares subject to options currently exercisable are deemed to be
outstanding for purposes of computing the percent of class owned by
such person and by all directors and executive officers as a group.
(2) Includes 1,423,780 shares held by the Suggs Family Partnership, LLC,
of which Mrs. Suggs is the sole manager, and 28,480 shares that she
has the right to acquire pursuant to currently exercisable stock
options.
(3) Information regarding Mrs. Suggs appears in this table under the
caption "Directors and Nominees."
(4) Includes the following shares of Non-Voting Stock allocated to
director accounts under the PHI Director Stock Compensation Plan:
Arthur Breault, 1,277 shares; Dean McFarland, 1,277 shares;
Mr. Murphy, 1,277 shares; and Mr. Whitman, 1,277 shares. Includes
the following shares of non-voting Common Stock that the named
individuals have the right to acquire pursuant to currently exercisable
stock options: Mr. Schrick, 10,150 shares; Mr. Sorenson, 4,345 shares;
Mr. Townsend, 5,053 shares; and Mr. McCann, 3,000 shares.
(5) Includes an aggregate of 28,480 shares of Voting Stock which
executive officers have the right to acquire pursuant to currently
exercisable stock options.
(6) Includes an aggregate of 27,468 shares of Non-Voting Stock which
executive officers have the right to acquire pursuant to currently
exercisable stock options.
--------------------
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following, to PHI's knowledge, are the only beneficial owners of
more than 5% of the outstanding Voting Stock, determined in accordance with
Rule 13d-3 of the SEC, other than Carroll W. Suggs, 2121 Airline Highway,
Suite 400, Metairie, Louisiana 70001, whose beneficial ownership of the
Voting Stock is shown under the heading "Stock Ownership of Directors and
Executive Officers." Unless otherwise indicated, all shares shown as
beneficially owned are held with sole voting and investment power.
Common Number of Percent of
Beneficial Owner Stock Shares (1) Class (1)
---------------- ------ ---------- ----------
David L. Babson & Co., Inc. Voting 179,200 6.42%
One Memorial Drive
Cambridge, MA 02142-1300
First Union Corporation Voting 192,000 6.87%
One First Union Center
Charlotte, NC 28288-0137
Woodbourne Partners, L.P Voting 165,800 5.9%
200 N. Broadway, Suite 825
St. Louis, MO 63102
FMR Corp. Voting 211,200 7.54%
82 Devonshire Street
Boston, MA 02142-1300
- --------------------------
(1) Based solely on information furnished in Schedule 13Gs files with the
SEC by such persons.
----------------------
EXECUTIVE COMPENSATION AND CERTAIN TRANSACTIONS
In 1999, PHI changed its fiscal year from one ending on April 30 to
one ending on December 31. The eight month transition period from May 1,
1999, to December 31, 1999, is referred to herein as the "Transition
Period" or "TP." The fiscal year ended April 30, 1999, is referred to as
"FY99," and the fiscal year ended April 30, 1998, is referred to as "FY98."
Summary of Executive Compensation
The following table summarizes, for the Transition Period, FY99 and
FY98, the compensation of PHI's Chief Executive Officer and of certain
other executive officers of PHI whose annual compensation was in excess of
$100,000, in all capacities in which they served.
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation Awards
Restricted Securities
Name and Principal Stock Underlying All Other
Position Year Salary Bonus(1) Awards(2) Options(3) Compensation(4)
- ------------------- ---- ------ -------- ---------- ---------- ---------------
$ $ # # $
<C> <C> <C> <C> <C> <C> <C>
Carroll W. Suggs TP 214,000 - - 30,000 169,547 (5)
Chairman, President FY99 331,653 - - 4,000 120,288
and CEO FY98 321,738 9,271 - - 125,800
Ben Schrick TP 142,246 - - 10,000 5,321
Chief Operating FY99 219,138 - - - 4,993
Officer FY98 210,631 6,157 1,578 - 4,800
William P. Sorenson TP 98,007 - - 10,000 4,963
Director of Corporate FY99 126,807 - - - 3,961
Marketing/New Business FY98 93,586 2,714 232 - 2,757
Kenneth A. Townsend TP 94,808 - - 7,500 4,852
General Manager, FY99 133,867 - - - 4,145
Domestic Oil & Gas FY98 89,047 2,714 789 - 2,577
Aviation Services
Michael J. McCann TP 114,424 - - 10,000 5,270
Chief Financial Officer FY99 84,138 - - 15,000 2,422
& Treasurer FY98 N/A N/A N/A N/A N/A
- --------------------
</TABLE>
(1) Represents a cash bonus of 2.83% of base pay in FY98.
(2) No awards of restricted shares have been made since FY98. FY98
awards vested in FY99 based on performance criteria for FY98. Dividend
income, if any, will be paid on the restricted stock at the same rate as
paid to all stockholders. Restrictions will lapse on July 31, 2001. As
of December 31, 1999, the number and fair market value of the shares of
restricted stock held by the named executive officers were: Mr. Schrick,
2,424 shares, $23,028; Mr. Sorenson, 881 shares, $8,370; and
Mr. Townsend, 1,444 shares, $13,718.
(3) For information about option holdings at December 31, 1999, refer
to the table below.
(4) Unless otherwise indicated, reflects amounts paid by PHI on behalf
of the Named Executive Officers pursuant to the PHI 401(k) Retirement
Plan.
(5) Includes directors fees of $16,000, $20,000, and $16,000 in the
Transition Period, FY99 and FY98, respectively, and life insurance
premiums for the benefit of Mrs. Suggs of $149,934 in the Transition
Period, $95,100 in FY99, and $105,000 in FY98.
------------------
Stock Option Grants
The following table contains information concerning the grant of stock
options to the Named Executive Officers during the Transition Period.
<TABLE>
<CAPTION>
Potential
Realizable Value of
No. Of % of Total Options at Assumed
Shares Options Annual Rates of Stock
Underlying Granted to Price Appreciation
Options Employees Exercise Expiration For Option Term
Name Granted(1) in TP(2) Price Date 5% 10%
---- ---------- ---------- -------- ---------- ----- -----
<C> <C> <C> <C> <C> <C> <C>
Carroll W. Suggs 30,000 17.44% $13.25 July 14, 2009 $44,357 $290,995
Ben Schrick 10,000 5.81% $12.75 July 14, 2009 23,766 180,201
William P. Sorenson 10,000 5.81% $12.75 July 14, 2009 23,766 180,201
Kenneth A. Townsend 7,500 4.36% $12.75 July 14, 2009 17,825 81,751
Michael J. McCann 10,000 5.81% $12.75 July 14, 2009 23,766 180,201
- ------------------
</TABLE>
(1) All options were awarded at the fair market value of the shares
underlying the options on the effective date of grant.
(2) Percentages listed in this column represent the percentage of all
options to acquire PHI Common Stock, both Voting and Non-Voting, granted
to all PHI employees during the Transition Period. Only Mrs. Suggs was
awarded options to acquire Voting Stock in the Transition Period.
Messrs. Schrick, Sorenson, Townsend and McCann were awarded 7.04%,
7.04%, 5.28% and 7.04%, respectively, of the options to acquire Non-
Voting Stock granted to PHI employees in the Transition Period.
---------------------
Option Holdings
The following table contains information with respect to the Named
Executive Officers concerning unexercised options held as of December 31,
1999. No options were exercised by any of them in the Transition Period.
<TABLE>
<CAPTION>
Number of Securities Underlying Value of Unexercised In-the-Money
Unexercised Options Options (1)
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<C> <C> <C> <C> <C>
Carroll W. Suggs 28,480 30,000 $ 0 0
Ben Schrick 10,150 10,000 $10,150 0
William P. Sorenson 4,345 10,000 $ 4,345 0
Kenneth A. Townsend 5,053 7,500 $ 5,053 0
Michael J. McCann 3,000 22,000 $ 0 0
- --------------------
</TABLE>
(1) Reflects the difference between closing bid prices of the Common
Stock on December 31, 1999, and the respective exercise prices of
the options.
-------------------
Supplemental Executive Retirement Plan
PHI maintains a supplemental executive retirement plan ("SERP") to
supplement the retirement benefits otherwise available to PHI's officers
and certain key employees pursuant to the PHI 401(k) Retirement Plan. The
SERP provides an annual benefit, generally equivalent to 33 1/2% of each such
participant's salary at the date she or he became a participant up to
$200,000 of salary, plus 50% of such salary in excess of $200,000, for a
period of 15 years following retirement at age 65 or older. Similar
benefits are also provided upon death or disability of the participant.
The estimated annual benefits payable upon retirement at normal retirement
age for Mrs. Suggs and Messrs. Schrick, Sorenson, Townsend and McCann are
$123,500, $70,600, $30,400, $41,300, and $58,200, respectively.
Compensation Committee Interlocks and Insider Participation in
Compensation Decisions
The Compensation Committee is composed of Leonard M. Horner, Bruce N.
Whitman, James W. McFarland, Arthur J. Breault, Jr. and Thomas H. Murphy.
No member of the Compensation Committee has ever been an officer or
employee of PHI or any of its subsidiaries.
During the Transition Period, PHI paid Aviall, Inc. ("Aviall")
approximately $200,000 for parts and component repair services, and
paid Flight Safety Boeing Training International, L.L.P. ("FlightSafety"),
approximately $258,000 for pilot training services. Mr. Bruce N. Whitman,
a member of the Compensation Committee, a director of PHI since 1996, and a
nominee for director at the Meeting, is a director of Aviall and a director
and an Executive Vice President of Flight Safety.
During the Transition Period, PHI paid approximately $28,000 for
consulting services to James W. McFarland, Chairman of the Compensation
Committee, a director since July 1996 and a nominee for director at the
Meeting.
The Compensation Committee's Report on Executive Compensation
General. The functions of the Compensation Committee are to determine
compensation paid to officers and key employees and to administer the 1992
Non-Qualified Stock Option and Stock Appreciation Rights Plan and the 1995
Incentive Compensation Plan. The Compensation Committee is composed
entirely of Board members who are not employees of PHI. The Compensation
Committee has retained an outside consultant from time to time to assist it
in obtaining relevant information on pay practices at comparable
organizations and to assist it in developing compensation programs that are
consistent with the Committee's compensation philosophy and objectives.
The Compensation Committee's overall policy regarding executive
compensation is to ensure PHI's compensation programs will provide
competitive salary levels and short-term and long-term incentives in order
to attract and retain individuals of high quality and ability, promote
individual recognition for favorable performance by PHI and support the
short and long range business objectives and strategies of PHI.
Under the Omnibus Budget Reconciliation Act ("OBRA"), publicly-held
companies may be prohibited from deducting as an expense for federal income
tax purposes total compensation in excess of $1 million paid to certain
executive officers in a single year. However, OBRA provides an exception
for "performance based" compensation, including stock options and
restricted stock awards. The Compensation Committee expects to keep
"non-performance based" compensation within the $1 million limit so that
all executive compensation will be fully deductible.
PHI's executive compensation consists of three principal components:
salary, annual incentive payments and stock options.
Salary and Annual Incentive Payments. In FY99, 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 included in the Oil and Gas
Field Services Index in the graph set forth under the heading "Performance
Graph" were among those considered. Because certain of these companies had
either revenues or total employees substantially exceeding those of PHI,
salaries of PHI executives were set at the lower end of the ranges. The
results of this study were reported to the Compensation Committee,
resulting in a pay increase for several executive officers in FY99.
No annual incentive payments were made to executives for FY99 or the
Transition Period. In May,1999, the Compensation Committee formulated a
new annual incentive program which is based on the achievement by PHI of
specified percentages of both earnings per share and earnings before
incentive payments ("targets"). No annual incentive payments will be made
unless PHI achieves at least 90% of targets; if PHI achieves over 120% of
targets, the Compensation Committee has discretion to authorize annual
payments in excess of those in the annual incentive program.
Achievement of the specified targets produces a maximum potential
annual incentive payment to executives expressed as a specified percentage
of salary. The actual payment is determined by the Committee in the case
of Chief Executive Officer and by the Chief Executive Officer in the case
of other executives based on performance criteria established by her and
approved by the Compensation Committee. If an executive is entitled to an
incentive payment, it will be made one-half in cash and one-half in
restricted stock of PHI vesting over a three-year period.
Stock Option Grants. In FY99 no stock options or other stock based
awards were granted. In the Transition Period, the Compensation Committee
granted options to executives to provide an additional incentive, to
promote a longer term perspective and commitment by executives, and to
maximize stockholder value by linking the financial interests of management
and stockholders. The number of options granted to each executive was
based upon the officer's salary level and responsibilities, are not
exercisable during the first year and are exercisable thereafter in 25%
increments.
Stock options have value to the executives only if there is an
increase in PHI's stock price. Stock options granted were made at 100% of
the market value of the stock on the date of the grant. The options
granted expire ten years after the date of the grant.
Chief Executive Officer Compensation. Mrs. Suggs' FY99 salary
increased due to a company-wide general wage increase in FY99. There was
no salary increase in the Transition Period, and no bonus awards in the
Transition Period or FY99. Options for 30,000 shares of Voting Stock were
awarded in the Transition Period, on the same terms as the stock options
awarded other executives.
The Compensation Committee believes that the compensation of the Chief
Executive Officer and other executive officers is competitive with or below
the comparable companies described above, but is consistent with the
Compensation Committee's policy of providing an appropriate balance between
short and long range individual and corporate performance.
By the Members of the Compensation Committee.
James W. McFarland Thomas N. Murphy
Chairman
Arthur J. Breault, Jr. Bruce N. Whitman
Leonard M. Horner
Performance Graph
The following Performance Graph compares PHI's cumulative total
stockholder return on its Voting Stock for the last five years with the
cumulative total return on the Russell 2000 Index and the Oil and Gas Field
Services Index, assuming the investment of $ 100 on January 1, 1995, at
closing prices on December 31, 1994, 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 and Gas Field Services Index consists of 84
publicly-held companies in the oil field service industry and is published
by Media General Financial Services Inc.
[Graph Here]
Cumulative Total Returns as of December 31,
Index 1994 1995 1996 1997 1998 1999
- ----- ---- ---- ---- ---- ---- ----
PHI 100.0 150.42 186.84 239.69 175.86 103.06
Russell 2000 100.0 126.21 144.84 174.56 168.54 201.61
Oil and Gas Field 100.0 134.62 199.61 302.99 155.80 208.99
Services
Certain Transactions
Aviall routinely provides aviation parts and component repair services
to PHI and in the Transition Period was paid approximately $200,000 for
these parts and services by PHI. FlightSafety Boeing Training
International, L.L.P. ("FlightSafety"), provides aviation training to PHI
and in the Transition Period was paid approximately $258,000 for these
services by PHI. Bruce N. Whitman, a director since August 1996 and a
nominee for director at the Meeting, is a director of Aviall and Executive
Vice President and a director of FlightSafety.
During the Transition Period, PHI paid approximately $28,000 for
consulting services to James W. McFarland, a director since July 1996 and a
nominee for director at the Meeting.
PROPOSED AMENDMENT TO
1995 INCENTIVE COMPENSATION PLAN
General
The 1995 Incentive Compensation Plan (the"Plan") provides that 175,000
shares of Voting Stock and 325,000 shares of Non-Voting Stock could be
awarded pursuant to stock awards, including stock options and restricted
stock, subject to adjustment in the event of stock splits or stock
dividends. At March 31, 2000, 16,715 shares of restricted Non-Voting Stock
had been awarded and not forfeited, options to purchase 58,480 shares of
Voting Stock were outstanding, options to purchase 24,136 shares of Non-
Voting Stock had been exercised, and options to purchase 217,717 shares of
Non-Voting Stock were outstanding. Accordingly, assuming all outstanding
restricted shares become vested and all outstanding options are exercised,
there would be 116,520 shares of Voting Stock and 66,432 shares of Non-
Voting Stock remaining available for awards under the Plan.
Proposed Share Increase
The Board of Directors has approved a proposed amendment to the Plan
that would increase the number of shares of Non-Voting Stock available for
awards by 250,000 shares, subject to future adjustment as provided in the
Plan. The Board has recommended this amendment so that it can continue to
reward officers and key employees of the Company having substantial
management responsibilities with the opportunity to acquire a proprietary
interest in the Company as an additional incentive to promote its success
and remain in its employ. It is not proposed to increase the number of
shares of Voting Stock available.
Vote Required
Adoption of the proposed increase in shares available under the plan
requires the affirmative vote of the holders of a majority of the
outstanding shares of Voting Stock present or represented at the Meeting.
The Board recommends that the shareholders vote FOR the adoption of the
proposed amendment.
RELATIONSHIP WITH INDEPENDENT
PUBLIC ACCOUNTANTS
PHI's consolidated financial statements for the Transition Period were
audited by the firm of Deloitte & Touche LLP, which was engaged on December
16, 1999, and will remain as PHI's auditors unless replaced by the Board
upon the recommendation of the Audit Committee.
Consolidated financial statements for FY98 and FY99 were audited by the
firm of KPMG LLP, which was replaced by the Board on November 23, 1999, upon
recomendation of the Audit Committee. In connection with the audits of PHI's
consolidated financial statements for FY98 and FY99 and for any subsequent
interim period prior to and including November 23, 1999, there were no
disagreements with KPMG LLP on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure,
which disagreements if not resolved to its satisfaction would have caused
KPMG LLP to make reference to the subject matter of the disagreements in
connection with its reports. The audit reports of KPMG LLP on PHI's
consolidated financial statements for FY98 and FY99 did not contain an
adverse opinion or a disclaimer of opinion and were not qualified or
modified as to uncertainty, audit scope, or accounting principles.
Representatives of Deloitte & Touche, LLP are expected to be present at
the Meeting with the opportunity to make a statement if they so desire, and
will also be available to respond to appropriate questions.
OTHER MATTERS
Quorum and Voting of Proxies
The presence, in person or by proxy, of a majority of the outstanding
shares of Voting 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
proposal to amend the 1995 Incentive Compensation Plan requires the
approval of the majority of the Voting Stock present or represented at the
Meeting.
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 with respect
to the election of directors. Shares as to which a broker or nominee does
not vote on a matter are referred to as broker non-votes on that matter.
Broker non-votes will be counted as present at the Meeting and will be
counted as present for purposes of determining whether the proposal to
amend the 1995 Incentive Compensation Plan has been approved. Accordingly,
a broker non-vote will leave the same effect as a vote against the proposed
amendment.
All proxies received by PHI in the form enclosed will be voted as
specified and, in the absence of instructions to the contrary, will be
voted for the election of the nominees named herein and for the proposed
amendment to the 1995 Incentive Compensation Plan. The Board 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 2001 annual meeting of
stockholders must forward such proposal to the Secretary of PHI at the
address set forth on the first page of this Proxy Statement in time to
arrive at PHI prior to December 30, 2000.
By Order of the Board of Directors
/s/ Robert D. Cummiskey, Jr.
----------------------------------
Robert D. Cummiskey, Jr.
Secretary
New Orleans, Louisiana
April 28, 2000
PETROLEUM HELICOPTERS, INC.
Proxy Solicited on Behalf of the Board of Directors
for the Annual Meeting of Stockholders on May 26, 2000
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., that the undersigned is entitled to vote at the annual
meeting of stockholders to be held May 26, 2000, and any adjournments
thereof.
Please specify your choices by marking the appropriate boxes. IF NO
SPECIFIC DIRECTIONS ARE GIVEN, THIS PROXY WILL BE VOTED FOR ALL NOMINEES
LISTED HEREON AND FOR THE PROPOSED AMENDMENT TO THE 1995 INCENTIVE
COMPENSATION PLAN.
[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 nominee's name(s) on the
space provided below the boxes.
The Board of Directors recommends a vote for all nominees listed
hereon.
1. Election of Directors
Nominees: Carroll W. Suggs, Arthur J. Breault, Jr., Leonard M.
Horner, James W. McFarland, Thomas H. Murphy, Bruce N. Whitman
FOR WITHHOLD
[ ] [ ]
FOR, except vote WITHHELD from the following nominee(s):
FOR AGAINST ABSTAIN
2. Proposed Amendment to
Incentive Compensation Plan [ ] [ ] [ ]
3. In their discretion, to transact such other business as may
properly come before the meeting and any adjournments 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, please 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.
SIGNATURE(S) DATE
