SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(A) of the Securities Exchange Act of 1934
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|X| Preliminary Proxy Statement |_| Confidential, for use of the
Commission only (as permitted by
Rule 14a-6(e)(2))
|_| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
MARINE TRANSPORT CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box): No fee required.
|X| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and O-11.
(1) Title of each class of securities to which transaction applies:
common stock, par value $.50 per share
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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|_| Fee paid previously with preliminary materials:
|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement no.:
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(3) Filing party:
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(4) Date filed:
March 25, 1999
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<PAGE>
[logo of Marine Transport Corporation]
Marine Transport Corporation
April __, 1999
Dear Stockholder:
You are cordially invited to attend the 1999 annual meeting of the stockholders
of Marine Transport Corporation to be held at the Model Room of The New York
Yacht Club located at 37 West 44th Street, New York, New York, on Tuesday, May
__, 1999, at 9:00 in the morning. Matters to be considered and acted upon by our
stockholders include the election of directors, ratification of the appointment
of the certified public accountants of Marine Transport Corporation, approval of
an amendment to the Amended and Restated Certificate of Incorporation of Marine
Transport Corporation by which the number of directors constituting the Board of
Directors would not be less than five nor more than fifteen and approval of
certain amendments to the Marine Transport Corporation 1998 Stock Option Plan
for Non-Employee Directors and the Marine Transport Corporation 1998 Incentive
Equity Plan. These matters and the procedures for voting your shares are
discussed in the accompanying Notice of Annual Meeting and Proxy Statement.
The vote of every stockholder is important regardless of the number of
shares owned. Accordingly, your prompt cooperation in signing, dating, and
mailing the enclosed proxy will be appreciated.
Sincerely,
[paste up signature]
RICHARD T. DU MOULIN
President, Chairman and Chief Executive
Officer
<PAGE>
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY __, 1999
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Marine
Transport Corporation will be held in the Model Room of The New York Yacht Club
located at 37 West 44th Street, New York, New York, on Tuesday, May __, 1999, at
9:00 a.m. (Eastern Daylight Savings Time), for the following purposes:
(1) To elect four directors (Class I) for a three-year term, each to hold office
until his successor shall be duly elected and qualified (the election of Mr.
Brent D. Baird to Class I is contingent upon the approval of an amendment to the
Amended and Restated Certificate of Incorporation of the Company by which the
number of directors constituting the Board of Directors would not be less than
five nor more than fifteen (as opposed to five, seven or nine));
(2) To ratify the appointment of Ernst & Young LLP as auditors of the Company
and various subsidiaries for the year ending December 31, 1999;
(3) To approve an amendment to the Amended and Restated Certificate of
Incorporation of the Company by which the number of directors constituting the
Board of Directors would not be less than five nor more than fifteen (as opposed
to five, seven or nine) which amendment requires the affirmative vote of the
holders of 80% or more of the outstanding shares of common stock of the Company;
(4) To increase the shares of common stock which may used for awards under the
Company's 1998 Stock Option Plan For Non-Employee Directors from 100,000 shares
to 150,000 shares;
(5) To increase the shares of common stock which may be used for awards under
the Company's 1998 Incentive Equity Plan from 550,000 shares to 825,000 shares
and to make certain other amendments to such plan; and
(6) To consider and act on such other business as may properly come before the
meeting.
The Board of Directors has fixed the close of business on April 1, 1999
as the record date for the determination of stockholders entitled to notice of
and to vote at the meeting.
A complete list of the stockholders entitled to vote at the meeting
will be available at the offices of Marine Transport Corporation, 1200 Harbor
Boulevard, Weehawken, New Jersey, at least 10 days prior to the meeting.
By Order of the Board of Directors
[paste up signature]
PETER N. POPOV
Secretary
Weehawken, New Jersey
April __, 1999
IMPORTANT
PLEASE DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT AT YOUR
EARLIEST CONVENIENCE IN THE ENCLOSED STAMPED, ADDRESSED ENVELOPE SO
THAT IF YOU ARE UNABLE TO ATTEND THE MEETING YOUR SHARES MAY
NEVERTHELESS BE VOTED.
<PAGE>
MARINE TRANSPORT CORPORATION
1200 Harbor Boulevard
Weehawken, New Jersey 07087-0901
PROXY STATEMENT
The following statement is submitted to stockholders to solicit proxies
for the Annual Meeting of Stockholders of Marine Transport Corporation (the
"Company") to be held on May __, 1999. This proxy is being mailed to holders of
record on or about April __, 1999, concurrently with the Company's 1998 Annual
Report. The Company's corporate headquarters are located at 1200 Harbor
Boulevard, Weehawken, New Jersey 07087-0901 but the Annual Meeting will be held
in the Model Room of The New York Yacht Club located at 37 West 44th Street, New
York, New York. A proxy for this meeting is enclosed.
The purposes of the meeting are:
(1) To elect four directors (Class I) for a three-year term, each to hold
office until his successor shall be duly elected and qualified (the
election of Mr. Brent D. Baird to Class I is contingent upon the
approval of an amendment to the Amended and Restated Certificate of
Incorporation of the Company by which the number of directors
constituting the Board of Directors would not be less than five nor
more than fifteen (as opposed to five, seven or nine));
(2) To ratify the appointment of Ernst & Young LLP as auditors of the
Company and various subsidiaries for the year ending December 31, 1999;
(3) To approve an amendment to the Amended and Restated Certificate of
Incorporation of the Company by which the number of directors
constituting the Board of Directors would not be less than five nor
more than fifteen (as opposed to five, seven or nine) which amendment
requires the affirmative vote of the holders of 80% or more of the
outstanding shares of common stock of the Company;
(4) To increase the shares of common stock which may be used for awards
under the Company's 1998 Stock Option Plan For Non-Employee Directors
from 100,000 shares to 150,000 shares;
(5) To increase the shares of common stock which may be used for awards
under the Company's 1998 Incentive Equity Plan from 550,000 shares to
825,000 shares and to make certain other amendments to such plan; and
(6) To consider and act on such other business as may properly come before
the meeting.
The solicitation of the proxy enclosed with this Proxy Statement is
made by and on behalf of the Board of Directors of the Company. The cost of this
solicitation will be paid by the Company. Such costs include preparation,
printing and mailing of the Notice of Annual Meeting, form of proxy and this
Proxy Statement. The solicitation will be conducted principally by mail,
although directors, officers and employees of the Company and its subsidiaries
(at no additional compensation) may solicit proxies personally or by telephone
and telegram. Arrangements will be made with brokerage houses and other
custodians, nominees and fiduciaries for proxy material to be sent to their
principals and the Company will reimburse such persons for their expenses in so
doing.
The shares represented by all valid proxies in the enclosed form will
be voted if received in time for the meeting and voted in accordance with the
specifications, if any, made on the proxy. If no specification is made, the
proxies will be voted FOR the nominees for directors, FOR the ratification of
the appointment of Ernst & Young LLP as auditors and FOR the amendments to the
(a) Amended and Restated Certificate of Incorporation; (b) 1998 Stock Option
Plan for Non-Employee Directors; and (c) 1998 Incentive Equity Plan. A proxy is
revocable at any time prior to being voted by giving written notice to the
Secretary of the Company or by attending the meeting and voting in person.
CERTAIN BACKGROUND INFORMATION CONCERNING MARINE
TRANSPORT CORPORATION, ITS DIRECTORS AND ITS EXECUTIVE
OFFICERS
During 1998, in connection with the transactions described below, the
Company changed its name from OMI Corp. to Marine Transport Corporation.
Pursuant to the terms and conditions of an Acquisition Agreement dated as of
September 15, 1997 by and among the Company, Universal Bulk Carriers, Inc. (a
former subsidiary of the Company), Marine Transport Lines, Inc. ("MTL") and
certain shareholders of MTL, the Company acquired all of the outstanding common
stock of MTL on or about June 17, 1998 (the "Acquisition"). In consideration for
the purchase of all of the outstanding common stock of MTL, MTL shareholders
were issued 3,684,449 shares of the common stock of the Company. (See "Security
Ownership of Certain Beneficial Owners and Management.") Contemporaneously with
the Acquisition, the Company separated its foreign and domestic shipping
operations and transferred the assets, liabilities and operations of its foreign
business to a newly created corporation ("New OMI"). As a result of these
transactions: (a) the stockholders of the Company became stockholders of two
separate publicly traded companies, the Company and New OMI, which was named OMI
Corporation; (b) the Company became an entity consisting of the Company's
domestic shipping assets, liabilities and operations and certain assets,
liabilities and operations of MTL; (c) New OMI became an entity consisting of
the Company's international shipping assets, liabilities and operations; (d) the
management of the Company was assumed by certain officers and directors of MTL
(as well as certain newly elected directors); and (e) the management of New OMI
was assumed by certain of the Company's officers and directors of the Company
who served in that capacity prior to the acquisition.
VOTING SECURITIES AND VOTES REQUIRED
As of April 1, 1999, the record date for the meeting, the Company had
outstanding 6,555,368 shares of common stock, par value $.50 per share (the
"Common Stock"). Each share of common stock is entitled to one vote on all
matters to come before the meeting, including the election of directors. A
majority of the outstanding shares of common stock, represented in person or by
proxy, constitutes a quorum for the transaction of business at the Annual
Meeting, except with respect to the proposal to amend the Company's Amended and
Restated Certificate of Incorporation. A stockholder who abstains from voting on
any or all proposals will be included in the number of stockholders present at
the meeting for the purpose of determining the presence of a quorum. Brokers who
hold shares for the account of their clients may vote such shares either as
directed by their clients or in their own discretion if permitted by the
exchange or other organization of which they are members.
The election of each nominee for director requires a plurality of votes
of the holders of the shares of common stock cast in the election of directors.
The proposal to amend the Company's Amended and Restated Certificate of
Incorporation requires the affirmative vote of the holders of 80% or more of the
outstanding shares of common stock of the Company. The proposals to amend the
1998 Stock Option Plan for Non-Employee Directors and 1998 Incentive Equity
Plan, and ratify the appointment of auditors require the affirmative vote of the
holders of a majority of the shares of common stock present in person or
represented by a proxy at the meeting. Broker non-votes will not be treated as
votes cast with respect to any matter presented at the Annual Meeting and
abstentions will be treated as negative votes on all matters other than election
of directors, in which case they will not be counted either in favor of or
against the election of the nominee.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of April 1, 1999, certain
information with respect to (i) each person known to the Company to be the
beneficial owner of more than five percent (5%) of the Company's common stock,
which is the only class of outstanding voting securities, (ii) each director and
nominee for director, (iii) each executive officer and (iv) all directors and
all executive officers as a group:
Name and Address Of Amount and Nature of Percent of Class
Beneficial Owner Beneficial Ownership(1)
Brent D. Baird 875,500 13.3%
1350 One M&T Plaza
Buffalo, New York (2)
Harrowston Corporation 535,743 8.1%
Suite 3280
P.O. Box 753
181 Bay Street
Toronto, Ontario M5J 2T3
Canada
Kenneth E. Jones 404,678 6.1%
Seahawk Ranch
22495 Cabrillo Highway
Half Moon Bay, California
94019(3)
Directors and Nominees
- ----------------------
Richard T. du Moulin 644,724 9.7%
Paul B. Gridley 378,071 5.1%
Mark L. Filanowski 165,236 2.5%
Jerome Shelby 80,361 1.2%
William M. Kearns, Jr. 20,089 *
Stanley Rich(4) 11,848 *
Michael Klebanoff 26,973 *
Jonathan Blank 10,400 *
Elaine L. Chao 2,000 *
Non-Director Executive Officers
- -------------------------------
Peter N. Popov 13,336 *
Jeffrey M. Miller 11,447 *
All directors and executive 1,370,214 20%
officers as a group(11)
- -------------------------------
* Represents holdings of less than less than 1% (one percent)
(1) Includes all shares with respect to which each person, executive officer,
director or nominee for director, directly or indirectly, through any
contract, arrangement, understanding, relationship or otherwise, has or
shares the power to vote or to direct voting of such shares or to dispose
or to direct the disposition of such shares. With respect to executive
officers, includes shares that may be purchased under currently exercisable
stock options granted pursuant to the Marine Transport Corporation 1998
Incentive Equity Plan. (Under the terms of that plan, no options granted
pursuant thereto are currently exercisable.) With respect to non employee
directors, includes shares that may be purchased under currently
exercisable stock options granted pursuant to the Marine Transport
Corporation 1998 Stock Option Plan for Non-Employee Directors. (Under the
terms of that plan, no stock options granted pursuant thereto are currently
exercisable.)
(2) Includes 30,000 shares owned by Aries Hill Corp., a private holding company
with an address at 1350 One M&T Plaza, Buffalo, New York 14203, of which
Mr. Baird is a director, President and Treasurer (Mr. Baird has shared
voting power and shared investment power with regard to these shares);
25,000 shares owned by Mr. Baird; 50,000 shares owned by Mr. Brian D.
Baird, Mr. Baird's brother, in his capacity as Successor Trustee under an
agreement dated 7/31/22; 70,500 shares owned by The Cameron Baird
Foundation, a charitable private foundation with an address at Box 564,
Hamburg, New York 14075, whose board consists of members of Mr. Baird's
family; and 549,710 shares owned by First Carolina Investors, Inc. ("FCI"),
a closed end non-diversified management investment company with an address
at 1130 East 3rd Street, Suite 1410, Charlotte, North Carolina 28204, of
which Mr. Baird is Chairman and Director (Mr. Baird has shared voting power
and shared investment power with regard to these shares). When aggregated
with the beneficial interests in FCI common stock of their spouses,
children, parents, siblings and various corporations, trusts and other
entities associated with the Baird family, the family's cumulative
ownership of FCI's outstanding common stock is approximately 55% .
(3) Includes 2,000 shares owned by the Joanne Lauridsen Trust of which Mr.
Jones is a trustee; 326,666 shares owned by the Seahawk Investment Trust of
which Mr. Jones and his wife are trustees; and 73,334 shares owned by the
Seahawk Ranch Irrevocable Trust of which Mr. Jones is a trustee. In her
capacity as a trustee of the Seahawk Ranch Irrevocable Trust, Mr. Jones'
wife Signed Kim Lauridsen-Jones shares voting and investment power with
regard to 326,666 shares.
(4) Includes 1,000 shares purchased for Mr. Rich's granddaughter in the name of
her mother as custodian.
ELECTION OF DIRECTORS
The Company's Restated Certificate of Incorporation and By-Laws provide
that the number of directors constituting the entire Board of Directors of the
Company shall be five, seven or nine divided into three classes, as nearly equal
in number as the then total number of directors constituting the entire Board of
Directors permits. The Board currently consists of nine (9) members divided into
three classes. The directors in each class hold office for staggered terms of
three years. The three current Class I directors, Jonathan Blank, Mark L.
Filanowski and Stanley B. Rich, whose present terms expire in 1999, are being
proposed for reelection for new three year terms (expiring in 2002) at this
Annual Meeting. The Board has also nominated Brent D. Baird to become a member
of Class I for election to a three year term to run concurrently with the term
of the three incumbent directors. Mr. Baird's election to Class I is, however,
contingent upon the approval of an amendment (the "Amendment") to the Company's
Amended and Restated Certificate of Incorporation by which the number of
directors constituting the Board of Directors would be not less than five or
more than fifteen (as opposed to five, seven or nine). In the event that the
Amendment is not approved, Class I will not be large enough to accommodate
election of the incumbent Class I directors and the election of Mr. Baird, in
which case Mr. Baird will not be elected to Class I. Approval of the Amendment
requires the affirmative vote of the holders of 80% or more of the outstanding
shares of common stock of the Company.
All nominees for Class I are willing to serve as directors, but if any
nominee becomes unable to serve prior to the Annual Meeting, the persons named
as proxies have discretionary authority to vote for a substitute nominee named
by the Board of Directors, or the Board of Directors may reduce the number of
directors to be determined and elected.
The Board of Directors recommends a vote in favor of the election of
the nominees for directors to Class I.
The following table sets forth certain information regarding the
members of and nominees for the Board of Directors:
Name and Other Age Class and Year in Principal First Became a
Information Which Term Expires Occupation Director
NOMINEES FOR ELECTION AT THE 1999 ANNUAL MEETING
Brent D. Baird 60 Private Investor
Jonathan Blank 55 Class I (1999) Partner, Preston 06/15/98
Gates Ellis &
Rouvelas Meeds
Mark L. Filanowski 44 Class I (1999) Senior Vice 06/15/98
President,
Treasurer and
Chief Financial
Officer,
Marine Transport
Corporation
Stanley B. Rich 75 Class I (1999) Independent 06/15/98
Accountant
DIRECTORS WHOSE TERMS CONTINUE
Paul B. Gridley 46 Class II (2000) Consultant to 06/15/98
Marine Transport
Corporation
William M. 63 Class II (2000) Vice Chairman, Keefe 06/15/98
Kearns, Jr. Managers, Inc. and
President, W.M.
Kearns & Co., Inc.
Michael Klebanoff 78 Class II (2000) Private Investor 01/29/69*
And Director of
OMI Corporation
Elaine L. Chao 46 Class III (2001) Distinguished 06/15/98
Fellow, The Heritage
Foundation and
Chairman of its Asia
Adversary Council
Richard T. du Moulin 52 Class III (2001) Chairman 06/15/98
of the Board,
President and
Chief Executive
Officer,
Marine Transport
Corporation
Jerome Shelby 69 Class III (2001) Of Counsel, 06/15/98
Cadwalader,
Wickersham &
Taft
* Mr. Klebanoff was a director of the Company prior to the Acquisition and
related transactions. (See "Certain Background Information Concerning
Marine Transport Corporation, Its Directors and Its Executive Officers.")
ADDITIONAL INFORMATION CONCERNING THE BOARD OF DIRECTORS
AND NOMINEES TO THE BOARD OF DIRECTORS
During 1998, there were four Board of Directors meetings of the
Company, three of which were held after the Acquisition. Messrs. Rich,
Filanowski and Blank, incumbent directors being nominated for reelection,
attended all of the meetings of the Board held during the period for which each
has been a director.
The Audit Committee, which consists of Messrs. Rich and Blank,
recommends to the Board the auditors to be appointed for the Company, reviews
the results of each year's audit, evaluates any recommendations the auditors may
propose concerning the Company's internal controls and procedures and oversees
the responses made to any such recommendations.
The Compensation Committee, which consists of Messrs. Kearns, Shelby
and Rich, reviews and determines the compensation of the Company's executives.
In 1998, the Audit Committee met two times for the purpose of reviewing audit
procedures and inquiring into financial, legal, and other matters, and the
Compensation Committee met three times for the purpose of reviewing overall
compensation and employee benefit practices and programs.
The Company does not have a nominating or similar committee.
The Nominees to Class I
Mr. Baird is a private investor and a member of the boards of directors
of Barrister Information Systems Corporation, M&T Bank Corporation, First
Carolina Investors, Inc., Ecology & Environment, Inc., Ogleby Norton
Corporation, Exolon - ESK, Inc., Todd Shipyards Corporation and Merchants Group,
Inc. Mr. Baird was a major shareholder of Marine Transport Lines, Inc. ("MTL"),
currently a subsidiary of the Company, and served on MTL's board of directors
from 1986 until 1989 when MTL was a public company. Mr. Baird was selected to be
a nominee to Class I because of his experience and knowledge of U.S.-based
shipping.
Mr. Blank has experience in maritime issues, especially those affecting
U.S. flag vessels, and has been a partner with Preston Gates Ellis & Rouvelas
Meeds since prior to 1994.
Mr. Filanowski has been Senior Vice President, Chief Financial Officer
and Treasurer of the Company since June, 1999. Prior thereto he was Senior Vice
President of MTL since November 1989 serving as MTL's head of operations and
ship management since 1994 and as chief financial officer from 1989 to 1994.
From 1984 to 1988, Mr. Filanowski served as Vice President and Controller of
Armtek Corporation, and from 1976 to 1984 he served as Audit and Tax Manager for
Ernst & Young. Mr. Filanowski is a director of Shoreline Mutual (Bermuda), Ltd.,
a mutual insurance company that provides guarantees to the U.S. Coast Guard on
behalf of the insurance company's members (including the Company) to enable them
to be issued Certificates of Financial Responsibility under the Oil Pollution
Act of 1990.
Mr. Rich has been a practicing accountant for over 50 years and served
as an advisor to MTL's board of directors from 1993 until 1998 and from 1989 to
1993 was a member of MTL's Board of Directors. Mr. Rich is a retired director of
Fleet Bank.
The Members of Class II
Mr. Gridley is a consultant to the Company. Mr. Gridley was the
President and Vice Chairman of MTL from November 1989 until June 18, 1999. Prior
to that time, Mr. Gridley was employed as a Senior Vice President of Shearson
Lehman Hutton, Inc. in the Investment Banking Division where he was responsible
for ship financing.
Mr. Kearns formed W.M. Kearns & Co., Inc., a private investment
company, where he has served as President since July 1994. From 1969 to June
1994, Mr. Kearns was a Managing Director of Lehman Brothers and its predecessor
firms. Mr. Kearns has been an advisor to MTL's board of directors since 1993 and
from 1989 to 1993 was a member of MTL's Board of Directors. Mr. Kearns is a
director of Selective Insurance Group, Inc., Kuhlman Corporation, Malibu
Entertainment Worldwide, Inc., Fundamental Management Corporation and Greenfield
Capital Partners, Inc.; a trustee of EQ Advisors Trust (The Equitable Life
Assurance Society of the United States); and a senior advisor of Proudfoot PLC.
He has been the Vice Chairman of Keefe Managers, Inc. since December of 1998.
Mr. Klebanoff is a private investor who founded the predecessor of the
Company. From 1983 to 1995, Mr. Klebanoff was Chairman of the Board of the
Company, and from 1969 to 1983 he was President of the Company. He is a
currently a member of the board of directors of OMI Corporation.
The Members of Class III
Ms. Chao has been a Distinguished Fellow at The Heritage Foundation
since August 1996 where she is also chairman of its Asia Advisory Council. From
1992 to 1996, Ms. Chao was president and chief executive officer of United Way
of America. Prior to joining United Way of America, she was director of the
Peace Corps and prior thereto was deputy secretary of the U.S. Department of
Transportation. In 1988 and 1989, Ms. Chao was the chairman of the Federal
Maritime Commission. From 1986 to 1988, she served as deputy administrator of
the Maritime Administration. Ms. Chao is a director of Dole Food Co., Inc.,
Vencor, Inc., Protective Life Corp. and NASD, Inc.
Mr. du Moulin has been Chairman, Chief Executive Officer and President
of the Company since June 1998. Prior thereto he was Chairman and Chief
Executive Officer of MTL since November 1989. Prior to joining MTL, Mr. du
Moulin was employed at the Company, where he held the position of Chief
Operating Officer and was a member of the Board of Directors. Mr. du Moulin
served three years as a U.S. Navy officer and thereafter continued to serve on
the Fales Advisory Committee to the Superintendent of the U.S. Naval Academy. He
is presently Chairman of the International Association of Independent Tanker
Owners (INTERTANKO), Chairman of the North American Regional Council for the
American Bureau of Shipping and is on the Board of Seamens Church Institute of
New York and New Jersey.
Mr. Shelby has been of counsel to the law firm of Cadwalader,
Wickersham & Taft since 1993, where Mr. Shelby was a partner from 1963 through
1992. Cadwalader, Wickersham & Taft has acted as counsel to the Company and from
time to time since 1958, provided legal services to MTL. Mr. Shelby has been an
advisor to MTL's board of directors since 1993 and from 1989 to 1993 was a
member of MTL's Board of Directors. He is also a director of Astro Tankers
Limited, an oil tanker owner, and is a director and executive vice president of
Energy Transportation Group, Inc., a shipping and energy company and is on the
board of Seamen's Church Institute of New York and New Jersey.
Certain Transactions and Business Relationships
Paul B. Gridley, a member of Class II of the Company's Board of
Directors, is party to a consulting agreement with the Company pursuant to
which, for two years commencing on or about June 18, 1998, he will perform
consulting services for the Company for $189,000 per year.
Jonathan Blank, a member of Class I of the Company's Board of
Directors, is also a member of the law firm of Preston Gates Ellis & Rouvelas
Meeds LLP ("Preston Gates"). The Company retained Preston Gates during its last
fiscal year and proposes to retain Preston Gates during the current fiscal year.
Jerome Shelby, a member of Class III of the Company's Board of
Directors, is also of counsel to Cadwalader, Wickersham & Taft ("Cadwalader").
In 1998, the Company retained and paid fees to Cadwalader for legal services.
The Company proposes to retain Cadwalader during the current fiscal year.
Compensation of Directors
Directors who are also officers or employees of the Company do not
receive any fees or remuneration for services on the Board of Directors or of
any Committee thereof. Commencing on or about June 18, 1998, each member of the
board of directors of the Company who is not an employee of the Company became
entitled to an annual retainer of $15,000 and a fee of $1,500 per board (or
committee) meeting attended.
Non-employee directors also participate in the Marine Transport
Corporation 1998 Stock Option Plan for Non-Employee Directors. Under such plan,
each non-employee director was automatically granted options to acquire 7,500
shares of the Company's common stock.
Executive Compensation
The Summary Compensation Table shows the compensation for the past
three years of each of the Company's Chief Executive Officer and three executive
officers, as well as the Chief Executive Officer and two additional officers of
the Company prior to the Acquisition (the "named executive officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation Awards
------------------- -------------------
Other Restricted Securities
Annual Stock Underlying All Other
Name and Compensation Awards Options/ Compensation
Principal Position Year Salary($) Bonus ($) ($) ($)(1) SARs(#)(2) ($)(3)
- ------------------ ---- --------- --------- --- ------ ---------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Craig H. Stevenson, Former 1998
President and Chief Executive
Officer (4)
1997 380,000 123,750 0 459,375 (5) 32,985
1996 300,000 0 0 0 0 18,714
Richard T. du Moulin, 1998 $157,716 $30,000 (7) 0 0 25,000 0
President and Chief Executive
Officer (6)
Mark L. Filanowski, Senior 1998 $120,288 $20,000 (7) 0 0 25,000 0
Vice President, Chief
Financial Officer and
Treasurer (6)
Peter N. Popov, Vice 1998 $93,561 $10,000 (7) 0 0 18,750 0
President, Secretary and
General Counsel (6)
Jeffrey Miller, Vice 1998 $72,173 $20,000 (7) 0 0 18,750 0
President, Chartering (6)
Vincent J. de Sostoa, Former 1998
Senior Vice Preside, Chief
Financial Officer and
Treasurer (4)
1997 250,000 66,000 0 0 0 21,553
1996 231,750 0 0 0 0 20,516
Fredric S. London, Senior 1998
Vice President, General
Counsel and Secretary (4)
1997 240,000 66,000 0 0 0 20,930
1996 224,500 0 0 0 0 19,718
</TABLE>
(1) The number and value of restricted stock holdings of each of the named
executive officers on December 31, 1998 was ________ and $_______ for Mr.
Stevenson. Messrs. du Moulin, Filanowski, Popov and Miller have no
restricted stock holdings.
(2) Options granted under the Marine Transport Corporation 1998 Equity
Incentive Plan to the named executive officers. Marine Transport
Corporation did not grant any stock appreciation rights in calendar year
1998.
(3) Includes amounts deferred or contributed under the OMI Corp. Savings Plan
for Messrs. Stevenson, De Sostoa and London for a combined value for 1998
of $__________.
(4) Messrs. Stevenson, de Sostoa and London served as officers of the Company
until June 17, 1998.
(5) The value of 50,000 restricted stock awards received under the OMI 1995
Incentive Equity Plan.
(6) Includes only those amounts paid to Messrs. du Moulin, Filanowski, Popov
and Miller in their capacity as executive officers of Marine Transport
Corporation since June 18, 1998. Prior to that date, Messrs. du Moulin,
Filanowski, Popov and Miller were officers of MTL.
(7) Does not include bonus amounts paid by Marine Transport Lines, Inc. to
Messrs. du Moulin, Filanowski, Popov and Miller after the Acquisition for
services rendered to Marine Transport Lines, Inc. prior to the Acquisition.
Employment Agreements
The Company has employment agreements with Messrs. du Moulin,
Filanowski, Popov and Miller. Pursuant to the Employment Agreements, Messrs. du
Moulin, Filanowski, Popov and Miller receive base salaries prescribed therein
and are eligible for discretionary incentive bonuses approved by the
compensation committee of the Company's board of directors.
The agreements with each executive are for one-year terms commencing on
June 18, 1998 and may be renewed for consecutive one year periods. If the
agreements with Messrs. du Moulin and Filanowski are not renewed at the end of
any term thereof or if the Company terminates either Executive without cause,
the Company will be required to pay such Executive an amount equal to 150% of
the base salary then in effect for such affected Executive. The agreement with
Mr. Popov provides that if such agreement is not renewed at the end of any term
thereof or if the Company terminates Mr. Popov without cause, the Company will
be required to pay Mr. Popov an amount equal to the base salary in effect for
Mr. Popov. The agreement with Mr. Miller provides that if such agreement is not
renewed at the end of any term thereof or if the Company terminates Mr. Miller
without cause, the Company will be required to pay Mr. Miller an amount equal to
one-half of the base salary then in effect for Mr. Miller. Under the Employment
Agreements, each Executive will be paid, subject to the limitations of Section
280G of the Code, 300% of compensation then in effect upon the occurrence of a
change of control of the Company resulting from a hostile takeover.
Paul B. Gridley, a member of Class II of the Company's Board of
Directors, is party to a consulting agreement with the Company pursuant to
which, for two years commencing on or about June 18, 1998, he will perform
consulting services for the Company for $189,000 per year.
The following table shows information concerning stock options granted
to the named executive officers during calendar year 1998 pursuant to the Marine
Transport Corporation 1998 Incentive Equity Plan.
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates of
Stock Price Appreciation
Individual Grants for Option Term (2)
----------------- ------------------------------
Number of % of Total
Securities Options
Underlying Granted to Exercise or
Options Employees Base Price Expiration
Executive Officer Granted (1) in Fiscal Year (per Share) Date 5%($) 10%($)
- ----------------- ----------- -------------- ----------- ---- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Craig H. Stevenson, Jr 0 -- -- -- -- --
Richard T. du Moulin 25,000 8.8 $46.1 6/29/08 40,004.05 131,966.03
Mark L. Filanowski 20,000 7.1 $2.50 (3) 6/29/08 74,203.24 147,772.83
5,000 1.8 $4.61 6/29/08 8,000.81 26,393.21
Peter N. Popov 18,750 6.6 $2.50 (3) 6/29/08 69,565.54 138,537.03
Jeffrey Miller 18,750 6.6 $2.50 (3) 6/29/08 69,565.54 138,537.03
Vincent J. de Sostoa 0 -- -- -- -- --
Fredric S. London 0 -- -- -- -- --
</TABLE>
(1) Options for the named executive officer were granted as of June 29, 1998.
One-third of the options will become exercisable on June 29, 1999 and the
remaining options will become exercisable in one-third increments on June
29, 2000 and June 29, 2001, subject to the terms of the options.
(2) These amounts represent certain assumed rates of appreciation only. Actual
gains, if any, on stock option exercises and common stock holdings are
dependent on the future performance of the common stock and overall stock
market conditions.
(3) These options were originally granted on June 29, 1998 at $4.61 per share.
On or about December 1, 1998, the Board of Directors approved a stock
option repricing program pursuant to which the exercise price of these
options was reduced to $2.50 per share. On December 1, 1998, the closing
price for the Company's common stock was $2.03 per share. (See "Report of
Directors on Repricing of Stock Options.")
The following table shows the exercise of stock options or tandem SARs
during fiscal year 1998 by each of the named executive officers and the fiscal
year-end value of unexercised options and SARs.
Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Unexercised Value Of Unexercised
Options/SARs at Fiscal In-the-Money Options/SARs
Year End (#)(1) at Fiscal Year End ($)(2)
--------------- -------------------------
Number
of Securities
Underlying Value
Options/SARs Realized
Name Exercised(#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ---- ------------ --- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Craig H. Stevenson, Jr
Richard T. du Moulin 0 0 0 25,000 0 0
Mark L. Filanowski 0 0 0 25,000 0 0
Peter N. Popov 0 0 0 18,750 0 0
Jeffrey Miller 0 0 0 18,750 0 0
Vincent J. de Sostoa
Fredric S. London
</TABLE>
(1) Under the Marine Transport Corporation 1998 Incentive Equity Plan, options
vest over a period of three years (unless there is a change of control, in
which case the options vest immediately) are granted at an exercise price
of not less than 100% of the fair market value of the stock subject to the
option on the date of the grant of the option and are exercisable over a
period of not more than ten years from the date of grant.
(2) Based on the closing price of the Company's common stock on NASDAQ on
December 31, 1998 of $2.25.
The following table sets forth certain information concerning the
repricing of stock options held by the named executive officers:
Ten-Year Option/SAR Repricings
<TABLE>
<CAPTION>
Length of
Original
Option
Number of Term
Securities Exercise Remaining
Underlying Market Price of Price at at Date of
Options/SARs Stock at Time Time of New Repricing or
Repriced or of Repricing or Repricing or Exercise Amendment
Name Date Amended (#) Amendment Amendment Price ($) (in months)
---- ---- ----------- --------- --------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Mark L. Filanowski, Senior 12/1/98 20,000 $2.03 $4.61 $2.50 31
Vice President, Chief
Financial Officer and
Treasurer
Peter N. Popov, Vice 12/1/98 18,750 $2.03 $4.61 $2.50 31
President, Secretary and
General Counsel
Jeffrey Miller, Vice 12/1/98 18,750 $2.03 $4.61 $2.50 31
President, Chartering
</TABLE>
Report of Compensation Committee on Repricing of Stock Options
On or about December 1, 1998, the Compensation Committee of the Board
of Directors authorized the following:
o The Company agreed to reprice stock options granted to Messrs.
Filanowski, Popov and Miller on June 29, 1998 (the "Affected Options")
by reducing the stock option exercise price to $2.50 (the closing
price of the Company's common stock on the NASDAQ on December 1, 1998
was $2.03). The original stock option exercise price of the Affected
Options was $4.61.
o The vesting schedule for the Affected Options remained unchanged.
o The Affected Options continue to entitle the holders to purchase the
same number of shares covered by the original option grant and remain
exercisable for a period of 10 years from the original grant date.
Upon the recommendation of the Compensation Committee, the Board of
Directors authorized the repricing at its meeting held on December 2, 1998. As a
result of widespread volatility in the financial markets during the fall of
1998, the potential value of stock options previously granted to the Company's
employees and the economic incentives expected from the grant of such options
were significantly diminished. Therefore, the Compensation Committee determined
that the repricing was necessary to implement the purpose of the 1998 Incentive
Equity Plan by retaining and motivating the Company's key employees.
Compensation Committee
William M. Kearns, Jr.
Stanley Rich
Jerome Shelby
Report on Senior Executive Compensation
by the Board of Directors' Compensation Committee
The Compensation Committee of the Company's Board of Directors (the
"Committee") has furnished the following report on compensation with respect to
executive officers defined under the rules of the Securities and Exchange
Commission.
The Committee is comprised of non-employee directors of the Company
listed in this report. The Committee is responsible for developing and
recommending the Company's executive compensation principles, policies, and
programs to the Board of Directors. In addition, the Committee recommends to the
Board of Directors, on an annual basis, the compensation to be paid to the Chief
Executive Officer (the "CEO") and, with advice from the CEO, to each of the
other executive officers of the Company, including the executive officers named
in the Summary Compensation Table of this proxy statement (the "Named
Executives").
The Committee recently retained an outside compensation consultant to
review the scope of the Company's compensation structure and make suggestions
for revision, if desirable, to accomplish the Committee's objectives. The report
has not yet been completed and will be submitted to the Compensation Committee
as soon as it has been finalized.
Compensation Philosophy
The Company's compensation programs are meant to support and reinforce
its long-term business strategy and link pay to shareholder value. The current
programs provide executive officers and other key employees with the opportunity
to earn market competitive salaries and incentive compensation related to
performance considered to be acceptable to the Board. The objectives of the
Company's executive compensation program, as developed by the Committee, are to:
o Align compensation program design with the goals and key performance measures
and expectations of the Company and each business unit.
o Attract and retain high-quality executives with experience in the Company's
marine transportation markets.
o Reward executives for superior performance measured by corporate and
business unit financial results, strategic achievements, and individual
contributions.
o Align executives' interests with the long-term interests of shareholders by
enabling significant Company stock ownership.
The Company achieves these goals through a compensation strategy of
competitive salaries, annual cash bonuses and the grant of stock options and
other stock-based incentives.
The marine shipping industry is extremely competitive and cyclical.
Attraction and development of experienced executives in this narrow industry is
challenging. The best use of the Company's assets and interests cannot be
realized without the conception, development and execution of creative ideas
which fully utilize worthwhile opportunities as they arise. The Company's
current compensation plan allows the Compensation Committee to judge and reward
executive achievement which meets this criteria.
Internal Revenue Code Section 162(m) Policy
Section 162(m) of the Internal Revenue Code, as amended (the "Code"),
precludes tax deductions for compensation paid in excess of $1 million to Named
Executives unless certain conditions are met. Based on current pay levels and
the design of existing compensation plans, the Committee believes that any lost
tax deductions, if any, for such compensation will not be material as a result
of this Code section. Therefore, it is the Committee's intent to take no action
with respect to conforming with Section 162(m) conditions that permit tax
deductions.
Base Salaries
The Committee seeks to set base salaries for the Company's executive
officers at levels that are competitive with those for executives with
comparable roles and responsibilities, including revenue size, within the marine
shipping industry. Individual executive officer salaries are reviewed annually
by the Committee, which may approve increases from time to time based on
individual and company performance, as well as general increases in pay levels
for executives within the marine shipping industry.
Base salary increases were granted on or about June 18, 1998 to the
Named Executive Officers.
Annual Incentive Compensation
The Committee administers an annual cash incentive program for
executive officers, as well as other management employees. Executive officers
are either corporate executives or executives responsible for a significant
business segment.
Each year the Committee recommends to the Company's Board of Directors
an individual cash bonus. The amount of the cash bonus reflects the Committee's
consideration of such factors as earnings per share, cash flow, strategic
decisions that position the Company for long-term success, and individual
employee contributions. Awards for selected business unit executives also vary
based on business unit financial performance.
Equity Incentive Plan
The 1998 Equity Incentive Plan authorizes the Committee to award stock
options (both non-qualified and incentive options), stock appreciation rights, a
stock bonus, and restricted stock to key executives.
Stock option and restricted stock grants are designed to align the
long-term interests of the Company's executives with those of its shareholders
by directly linking executive pay to shareholder return. During 1998,
non-qualified options were granted pursuant to the 1998 Equity Incentive Plan at
not less than fair market value on the date of grant. Both the size of such
grants and the proportion relative to the total number of option shares granted
are a function of the recipient's level of responsibility within the Company,
stock option (and/or long-term incentive) grants provided to comparable
executives within other marine shipping companies, and the judgement of the
Committee. There were no grants of restricted stock in 1998.
Chief Executive Officer Compensation
The principles guiding compensation for the CEO are the same as those
set forth for other executive officers. Due to the Company's recent
restructuring arising from the Acquisition, Mr. du Moulin's overall compensation
is being reviewed in conjunction with the study by the appointed compensation
consultant. In 1998, he received a standard cost of living adjustment which
increased his salary from $295,000 to $303,850. Mr. du Moulin also received
incentive compensation of $30,000 which may be adjusted as a result of the
study. In addition, consistent with the policy of aligning executive pay
opportunity with shareholder interests, Mr. du Moulin was granted the option to
purchase 25,000 shares of the Company's common stock for $4.61 per share
pursuant to the 1998 Equity Incentive Plan.
Compensation Committee
William M. Kearns, Jr.
Stanley Rich
Jerome Shelby
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's executive
officers and directors and holders of more than 10% of the Company's common
stock (collectively, "reporting persons") to file reports of ownership and
changes in ownership of the Company's equity securities with the Securities and
Exchange Commission and NASDAQ. Based upon a review of the copies of such
reports furnished to the Company and written representations from the reporting
persons other than executive officers and directors of the Company that no
reports on Form 5 were required to be filed, the Company believes that all
reports by such reporting persons were timely filed except that one Form 5
report for each of Messrs. du Moulin, Gridley, Filanowski, Shelby, Kearns, Rich,
Klebanoff, Blank, Popov and Miller and Ms. Chao was not timely filed by February
15, 1999 to report the grant of options described. (See "Option Grants in Last
Fiscal Year.")
Compensation Committee Interlocks and Insider Participation
The Compensation Committee consists of Messrs. Kearns, Rich and Shelby,
all of whom are directors of the Company and none of whom are or were officers
of the Company or any of its subsidiaries. During 1998, Jerome Shelby was of
Counsel to the law firm of Cadwalader Wickersham & Taft and a member of the
Compensation Committee. In 1998, MTL and the Company retained Cadwalader
Wickersham & Taft to provide legal services.
Set forth below is a graph comparing the cumulative total shareholder
return on the Company's common stock with the cumulative total return of the Dow
Jones Equity Market Index and the Dow Jones Marine Transportation Index for the
five-year period ended December 31, 1998.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURNS
Among the Company, Dow Jones Equity Market Index and
Dow Jones Marine Transportation Index
Fiscal Year Ending December 31
[Graphical Representation of Data Chart Here]
The total return on the Company's common stock and each index assumes
the value of each investment was $100 on December 31, 1991, and that all
dividends were reinvested.
RATIFICATION OF AUDITORS
Pursuant to certain transactions which were consummated on or about
June 17, 1998 (see "Certain Background Information Concerning Marine Transport
Corporation, Its Directors and Its Executive Officers"), Deloitte & Touche LLP,
the Company's independent accountant for its 1996 and 1997 fiscal years,
resigned. At the annual shareholders meeting held on June 15, 1998, shareholders
voted to appoint Ernst & Young LLP as independent accountants of the Company. In
the past two years there were no disagreements with Deloitte & Touche on
accounting and financial disclosure, and there have been no reports from
auditors which have been qualified or modified as to uncertainty, audit scope,
or accounting principles, nor has there been an adverse opinion or a disclaimer
of opinion.
The Board of Directors has appointed Ernst & Young LLP as auditors of
the Company and various subsidiaries for the year 1999. A representative of
Ernst & Young LLP is expected to be present at the meeting with the opportunity
to make a statement if he desires to do so and to respond to appropriate
questions.
The Board of Directors recommends a vote in favor of ratification of
the appointment of Ernst & Young LLP as auditors for 1999.
PROPOSED AMENDMENT TO THE COMPANY'S AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION
The Company's Amended and Restated Certificate of Incorporation states
that the number of directors constituting the entire Board of Directors shall be
five, seven or nine, as fixed from time to time by the vote of not less than 66
2/3% of the entire Board of Directors. The Company's Board of Directors proposes
to amend the Company's Amended and Restated Certificate of Incorporation to make
the number of directors constituting the entire Board of Directors not less than
five nor more than fifteen, as fixed from time to time by the vote of not less
than 66 2/3% of the entire Board of Directors of the Company. Approval of this
proposal requires the affirmative vote of holders of 80% or more of the
outstanding shares of the Company common stock. A copy of the proposed amendment
to the Company's Amended and Restated Certificate of Incorporation is attached
as Exhibit A hereto.
The purpose of this proposal is to allow the Board of Directors to fix
the number of directors constituting its entire board at a number between five
and fifteen to: (a) permit Mr. Brent D. Baird to become a member of Class I of
the Company's Board of Directors; and (b) make the Company's Amended and
Restated Certificate of Incorporation consistent with its By-laws. Mr. Baird is
directly or indirectly the beneficial owner of approximately 13% of the
Company's common stock and possesses considerable knowledge and experience
concerning the shipping industry. The Board of the Company believes that the
Company will benefit materially if this proposal is adopted, thereby permitting
Mr. Baird to become a member of Class I of the Board of Directors if he receives
the votes required for his election thereto.
The Board of Directors recommends a vote in favor of this proposal.
PROPOSED AMENDMENTS TO THE 1998 STOCK OPTION PLAN FOR
NON-EMPLOYEE DIRECTORS AND 1998 INCENTIVE EQUITY PLAN
The Marine Transport Corporation 1998 Stock Option Plan for
Non-Employee Directors (the "1998 Directors Plan") was approved by the
shareholders of the Company on June 15, 1998. Under the 1998 Directors Plan, the
Company (a) automatically granted options to purchase 7,500 shares of the
Company's stock to each eligible non-employee director of the Company serving as
a director on June 18, 1998 and (b) will automatically grant to each
subsequently elected or appointed eligible non-employee director the option to
purchase 7,500 shares. 100,000 shares of the Company's common stock have been
reserved for awards under this plan.
The Marine Transport Corporation 1998 Incentive Equity Plan (the "1998
Incentive Plan") was approved by the shareholders of the Company on June 15,
1998. The 1998 Incentive Plan authorizes the Company to grant its employees
stock options, stock appreciation rights in tandem with such options, restricted
stock or bonuses payable in stock. 550,000 shares of the Company's common stock
have been reserved for awards under this plan.
The Compensation Committee has advised the Board of Directors that the
committee believes the number of shares reserved for options or awards under the
1998 Directors Plan and the 1998 Incentive Plan are insufficient to provide
equity incentives to eligible directors and employees of the Company beyond
2000. Therefore, the Board is proposing to amend the 1998 Directors Plan and the
1998 Incentive Plan to increase the number of shares of reserved for award
under: (a) the 1998 Directors Plan from 100,000 to 150,000; and (b) the 1998
Incentive Plan from 550,000 to 825,000. The Compensation Committee believes that
these amendments will enhance materially the ability of each plan to align more
effectively the interests of the Company's board members and employees with
those of the Company's shareholders and to attract and retain the managers which
the Company expects to need in the future.
The Company is also proposing to make certain additional amendments to
the 1998 Incentive Plan in order to meet the requirements for deductibility of
certain compensation paid by the Company under Section 162(m) of the Code. Under
that section, certain payments to executive officers of the Company in excess of
$1 million are not deductible by the Company. However, compensation that
qualifies as "performance-based compensation" is not subject to this limitation
and in order to so qualify, the terms of the compensation, including the
material terms of any performance goals under which the compensation is to be
paid, must be disclosed to, and approved by, the Company's stockholders.
The Board of Directors therefore proposes to amend the 1998 Incentive
Plan to contain the following provisions:
o A limit of no more than ____ shares may be optioned or awarded to
any one person during any year.
o The Compensation Committee may make restricted stock awards
conditioned upon the attainment of certain performance goals
based on the following criteria: earnings per share, return on
equity and net profits.
A copy of the 1998 Directors Plan, as proposed to be amended, is
attached as Exhibit B hereto. A copy of the 1998 Incentive Plan , as proposed to
be amended, is attached as Exhibit C hereto.
The Board of Directors recommends a vote in favor of the amendment.
OTHER MATTERS
The Company has no knowledge of any matters to be presented to the
meeting other than those set forth above. The persons named in the accompanying
form of proxy will use their own discretion in voting with respect to matters
which are not determined or known at the date hereof.
A copy of the Company's Annual Report on Form 10-K is enclosed with
this Proxy Statement.
Shareholder Proposals For 2000 Annual Meeting
Any proposals of stockholders to be presented at the Company's 2000
Annual Meeting pursuant to SEC Rule 14a-8 must be received at the Company's
principal executive offices, 1200 Harbor Boulevard, Weehawken, New Jersey
07087-0901, Attention: Secretary, not later than December 1, 1999, for inclusion
in the Company's proxy statement and form of proxy for that Annual Meeting.
Written notice of shareholder proposals to be submitted outside of SEC
Rule 14a-8 for consideration at the Company's 2000 Annual Meeting but not to be
included in the Company's proxy materials must be received by the Company, at
the address set forth in the preceding paragraph, on or before February 15, 2000
in order to be considered timely. The persons designated as proxies by the
Company for the 2000 Annual Meeting will have discretionary voting authority
with respect to any shareholder proposal of which the Company did not receive
timely notice.
Please sign, date, and return the accompanying proxy in the enclosed
envelope at your earliest convenience.
By Order of the Board of Directors
Peter N. Popov
Secretary
<PAGE>
Weehawken, New Jersey
April __, 1999
[LOGO]
Marine Transport Corporation
Notice of
Annual Meeting
and
Proxy Statement
Annual Meeting
of Stockholders
May __, 1999
9:00 A.M.
The Model Room
of The New York Yacht Club, 37 West 44th Street, New York, New York
<PAGE>
PROXY
MARINE TRANSPORT CORPORATION
ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF MARINE TRANSPORT CORPORATION
The undersigned stockholder hereby appoints Richard T. du Moulin and
Mark L. Filanowski or either of them, each with power of substitution, as proxy
or proxies for the undersigned, to attend the Annual Meeting of the Stockholders
of Marine Transport Corporation (the "Company"), to be held at 9:00 a.m., local
time, on Tuesday, May __, 1999, at The Model Room of The New York Yacht Club, 37
West 44th Street, New York, New York, or at any adjournment or adjournments
thereof, and to vote all shares of common stock of the Company owned of record
by the undersigned at the close of business on April __, 1999, hereby revoking
any proxy or proxies heretofore given and ratifying and confirming all that said
proxies may do or cause to be done by virtue hereof, for the purposes more fully
described in the accompanying Proxy Statement, and in their discretion, on other
matters which properly come before the meeting:
(A) ELECTION OF DIRECTORS
FOR all nominees listed below |_| WITHHOLD AUTHORITY to vote for
(except as marked to the contrary) all nominees listed below |_|
(INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the nominee's name in the list
below.)
Brent D. Baird
Jonathan Blank
Mark L. Filanowski
Stanley B. Rich
(B) APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS
FOR |_| AGAINST |_| ABSTAIN |_|
(C) AMENDMENT TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF
MARINE TRANSPORT CORPORATION BY WHICH THE NUMBER OF DIRECTORS
CONSTITUTING THE BOARD OF DIRECTORS WOULD NOT BE LESS THAN FIVE NOR
MORE THAN FIFTEEN
FOR |_| AGAINST |_| ABSTAIN |_|
(Continued and to be Signed and Dated on the Reverse Side)
(D) AMENDMENT TO THE MARINE TRANSPORT CORPORATION 1998 STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS INCREASING THE TOTAL NUMBER OF SHARES
ISSUABLE UNDER THE PLAN TO 150,000
FOR |_| AGAINST |_| ABSTAIN |_|
(E) AMENDMENT TO THE MARINE TRANSPORT CORPORATION 1998 INCENTIVE EQUITY
PLAN INCREASING THE TOTAL NUMBER OF SHARES ISSUABLE UNDER THE PLAN TO
825,000 AND CERTAIN OTHER AMENDMENTS AS DESCRIBED IN THE ACCOMPANYING
PROXY STATEMENT
FOR |_| AGAINST |_| ABSTAIN |_|
(F) IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE ON OTHER
MATTERS WHICH PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR
ADJOURNMENTS THEREOF.
UNLESS OTHERWISE INDICATED ABOVE OR UNLESS
THIS PROXY IS REVOKED, THE SHARES Date:___________________________
REPRESENTED BY THIS PROXY WILL BE VOTED FOR
THE NOMINEES, FOR THE APPOINTMENT OF X ______________________________
INDEPENDENT AUDITORS AND FOR THE AMENDMENTS
TO THE (A) AMENDED AND RESTATED CERTIFICATE X ______________________________
OF INCORPORATION, (B) MARINE TRANSPORT
CORPORATION 1998 STOCK OPTION PLAN FOR
NON-EMPLOYEE DIRECTORS AND (C) MARINE
TRANSPORT CORPORATION 1998 INCENTIVE EQUITY
PLAN.
(IMPORTANT: Please sign exactly
as your name or names appear on
the label affixed hereto, and
when signing as an attorney,
executor, administrator, trustee
or guardian, give your full
title as such. If the signatory
is a corporation, sign the full
corporate name by duly
authorized officer, or if a
partnership, sign in partnership
name by authorized person.)
<PAGE>
EXHIBIT A
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF
MARINE TRANSPORT CORPORATION
-------------------------------------------------
Pursuant to Section 242 of the General
Corporation law of the State of Delaware
-------------------------------------------------
Marine Transport Corporation, a corporation organized and existing
under the General Corporation Law of the State of Delaware (the "Corporation"),
hereby certifies as follows:
1. The Restated Certificate of Incorporation of the Corporation was
filed in the office of the Secretary of State of Delaware on December 12, 1983
and amendments to the Certificate of Incorporation were subsequently duly filed
and recorded (the Restated Certificate of Incorporation together with such
amendments shall be hereinafter referred to as the "Restated Certificate of
Incorporation").
2. The following amendment is to become effective as of _______,
1999 at 8:00 a.m.
3. Section (a) of ARTICLE SIXTH of the Restated Certificate of
Incorporation is amended to read in full as follows:
SIXTH: (a) The number of directors constituting the entire Board of
Directors shall be not less than five nor more than fifteen, as fixed from time
to time by the vote of not less than 66 2/3% of the entire Board of Directors;
provided, however, that the number of directors shall not be reduced so as to
shorten the term of any director in office at that time, and provided, further,
that the number of directors constituting the entire Board of Directors shall be
ten until otherwise fixed by the vote of not less than 66 2/3% of the entire
Board of Directors. The phrase "66 2/3% of the entire Board of Directors" as
used in this Restated Certificate of Incorporation shall be deemed to refer to
66 2/3% of the number of directors constituting the Board of Directors as
provided in Section (a) of this Article Sixth, without regard to any vacancies
then existing.
4. The aforesaid amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to
be affixed hereto and this certificate to be signed by its President and
attested by its Secretary this ____ day of _____, 1999.
MARINE TRANSPORT CORPORATION
By: _____________________
Richard T. du Moulin
President
[Corporate Seal]
Attest:
By: _____________________
Peter N. Popov
Secretary
<PAGE>
EXHIBIT B
MARINE TRANSPORT CORPORATION
AMENDED AND RESTATED
1998 STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS
--------------------------
1. Purpose of the Plan. The purpose of the Marine Transport
Corporation 1998 Stock Option Plan for Non-Employee Directors (the "Plan") is to
aid Marine Transport Corporation (the "Company") in securing for the Company and
its stockholders the benefits of having experienced and highly qualified persons
who are not and have never been employees of the Company or any of its
Subsidiaries or affiliates become and remain members of the Board of Directors
(the "Board") of the Company and to provide to such persons the benefits of the
incentive inherent in common stock ownership.
2. Stock Subject to Plan. The stock which may be issued and sold
under the Plan shall be the Common Stock (par value $0.50 per share) of the
Company, of a total number not exceeding 150,000 shares, subject to adjustment
as provided in Section 9. The stock to be issued may be either authorized and
unissued shares or issued shares acquired by the Company. Each stock option
granted pursuant to the Plan is referred to herein as an "Option." In the event
that Options granted under the Plan shall terminate or expire without being
exercised in whole or in part, new Options may be granted covering the shares
not purchased under such lapsed Options.
3. Eligibility. Each member of the Board shall be eligible to
receive Options in accordance with the terms of the Plan, provided he or she, as
of the date of a granting of an Option, (i) is not an employee of the Company or
any of its Subsidiaries or affiliates and (ii) is otherwise not eligible for
selection to participate in any plan of the Company or any of its Subsidiaries
or affiliates that entitles the participant therein to acquire securities or
derivative securities of the Company. Each member of the Board who receives an
option hereunder is referred to herein as an "Optionee." As used in the Plan,
"Subsidiary" means any corporation in which the Company, directly or indirectly,
controls 50% or more of the total combined voting power of all classes of such
corporation's stock.
4. Option Grants. (a) Subject to the maximum number of shares which
may be purchased pursuant to the exercise of Options, as set forth in Section 2
(as such number may be adjusted pursuant to the provisions of Section 9), and to
the approval of the Plan by the stockholders of the Company, an Option to
purchase, in the manner and subject to the terms and conditions hereinafter
provided, 7,500 shares of the Common Stock of the Company shall be and hereby is
granted, without further action by the Board, as of the close of business on the
Second Closing Date (as such term is defined in the Acquisition Agreement dated
as of September 15, 1997 among the Company, Universal Bulk Carriers, Inc.,
Marine Transport Lines, Inc. ("MTL") and certain shareholders of MTL), to each
person who is serving as an eligible director of the Company on such date.
(b) Each person who subsequent to the Second Closing Date, first
becomes an eligible director of the Company shall (i) on the date of the Annual
or Special Meeting of Stockholders of the Company at which he or she is first
elected to the Board by vote of the stockholders, or (ii) on the date of
appointment to the Board with respect to a director appointed to the Board by
the Board to fill a vacancy on the Board, however occurring, whether by the
death, resignation or removal of any director, any increase in the number of
directors comprising the Board, or otherwise, shall, by reason of such election
or appointment and without further action by the Board, be granted as of the
close of business on said date an Option to purchase, in the manner and subject
to the terms and conditions herein provided and to the extent such number of
shares remain available for such purpose hereunder, 7,500 shares of the Common
Stock of the Company. In the event that the number of shares available for
grants under the Plan is insufficient to make all grants hereby specified on the
applicable date, then all those who become entitled to a grant on such date
shall share ratably in the number of shares then available for grant under the
Plan.
(c) It is understood that the Board may, at any time and from time
to time after the granting of an Option hereunder, specify such additional
terms, conditions and restrictions with respect to such Option as may be deemed
necessary or appropriate to ensure compliance with any and all applicable laws,
including, but not limited to, terms, restrictions and conditions for compliance
with federal and state securities laws and methods of withholding or providing
for the payment of required taxes.
5. General Terms and Conditions of Options. Each Option granted
under the Plan shall be evidenced by an agreement in such form as the Board
shall prescribe from time to time in accordance with the Plan and shall comply
with the following terms and conditions:
(a) The Option exercise price with respect to that portion of the
shares of Common Stock covered by each Option granted pursuant to Section 4(b)
which become exercisable on the first anniversary date of the grant of the
Option (the "Initial Exercise Price for Section 4(b) Options") shall be the
higher of: (i) the Fair Market Value (as defined below) of the Common Stock on
the date the Option is granted or (ii) the average of the Fair Market Values of
the Common Stock for each of the 10 days ending on the date the Option is
granted. The Option exercise price with respect to that portion of the shares of
Common Stock covered by each Option granted pursuant to Section 4(a) which
become exercisable on the first anniversary date of the Option (the "Initial
Exercise Price for Section 4(a) Options") shall be the average of the Fair
Market Values of the Common Stock for each of the 10 days following the Second
Closing Date.
Fair Market Value on any date, means (i) if the Common Stock is
listed on a securities exchange or is traded over the Nasdaq National Market
System, the closing sales price on such exchange or over such system on such
date or, in the absence of reported sales on such date, the closing sales price
on the immediately preceding date on which sales were reported, or (ii) if the
Common Stock is not listed on a securities exchange or traded over the Nasdaq
National Market System, the mean between the bid and offered prices as quoted by
the National Association of Securities Dealers through Nasdaq for such date,
provided that if it is determined that the fair market value is not properly
reflected by such Nasdaq quotations, fair market value will be determined by
such other method as the Board determines in good faith to be reasonable.
(b) Each Option granted pursuant to the Plan shall be evidenced by
an Option Agreement. The Option Agreement shall not be a precondition to the
granting of Options; however, no person shall have any rights under any Option
granted under the Plan unless and until the Optionee to whom such Option shall
have been granted shall have executed and delivered to the Company an Option
Agreement. A fully executed original of the Option Agreement shall be provided
to both the Company and the Optionee.
(c) All Options shall be nonstatutory stock options not intended to
qualify as stock options entitled to special tax treatment under Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
(d) Options shall not be transferable by the Optionee otherwise than
by will or the laws of descent and distribution, and shall be exercisable during
the Optionee's lifetime only by the Optionee.
(e) Each Option shall be subject to the following restrictions on
exercise:
(i) The Option is not immediately exercisable. Except in the
event of the Optionee's death, an Option shall not be exercisable, in
whole or in part, prior to the expiration of one (1) year from the date of
grant or after the expiration of ten years from the date the Option was
granted. To the extent that an Option is not exercised within the ten-year
period of exercisability, it shall expire as to the then unexercised part.
(ii) Subject to Sections 5(e)(i), 6 and 7, the total number of
shares of Common Stock covered by the Option (as such number may be
adjusted pursuant to the provisions of Section 9) shall become exercisable
on the first anniversary date of the grant of the Option.
(iii) An Option shall not be exercisable with respect to a
fractional share or with respect to the lesser of fifty (50) shares or the
full number of shares then subject to the Option.
(iv) Except as provided in Section 6, an Option shall not be
exercisable in whole or in part unless the Optionee, at the time the
Optionee exercises the Option, is, and has been at all times since the
date of grant of the Option, a director of the Company.
(v) An Option may only be exercised by delivery of written
notice of the exercise to the Company specifying the number of shares to
be purchased and by making payment in full for the shares of Common Stock
being acquired thereunder at the time of exercise (including applicable
withholding taxes, if any); unless the Option Agreement shall otherwise
provide, such payment shall be made
(A) in United States dollars by check or bank
draft, or
(B) by tendering to the Company Common Stock shares
already owned for at least six (6) months by the person exercising
the Option, which may include shares received as the result of a
prior exercise of an Option, and having a Fair Market Value equal to
the cash exercise price applicable to such Option, or
(C) by a combination of United States dollars and Common
Stock shares as aforesaid, or
(D) in accordance with a cashless exercise program under
which, if so instructed by the Optionee, shares of Common Stock may
be issued directly to the Optionee's broker or dealer upon receipt
of the purchase price for such shares in cash from the broker or
dealer.
(vi) If at any time the Board shall determine, in its
discretion, that the listing, registration or qualification of shares upon
any national securities exchange or the Nasdaq National Market or under
any state or federal law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in
connection with, the sale or purchase of shares hereunder, such Option may
not be exercised in whole or in part unless and until such listing,
registration, qualification, consent or approval shall have been effected
or obtained, or otherwise provided for, free of any conditions not
acceptable to the Board in the exercise of its reasonable judgment.
6. Termination of Service. An Option shall terminate upon the
termination, for any reason, of the Optionee's directorship with the Company,
and no shares may thereafter be purchased under such Option except as follows:
(a) Upon retirement as a director of the Company after one (1) year
of service, each unexpired Option held by the Optionee shall, to the extent
otherwise exercisable on such date, remain exercisable, in whole or in part, for
a period of one (1) year following such retirement.
(b) Upon termination of service as a director of the Company by
reason of death or disability each unexpired Option held by the Optionee, or in
the case of death, the Optionee's executors, administrators, heirs or
distributees, as the case may be, shall become immediately exercisable and shall
remain exercisable, in whole or in part, for a period of one (1) year after such
termination. Disability shall mean an inability as determined by the Board to
perform duties and services as a director of the Company by reason of a
medically determinable physical or mental impairment, supported by medical
evidence, which can be expected to last for a continuous period of not less than
six (6) months.
In the event any Option is exercised by the executors,
administrators, heirs or distributees of the estate of a deceased Optionee, the
Company shall be under no obligation to issue Common Stock thereunder unless and
until the Company is satisfied that the person or persons exercising the Option
are the duly appointed legal representative of the deceased Optionee's estate or
the proper legatees or distributees thereof.
In no event, however, may an Option be exercised (i) prior to the
expiration of six (6) months from the date of grant, or (ii) after ten (10)
years from the date it was granted.
7. Change in Control. (a) Notwithstanding other provisions of the
Plan, but subject to Section 6 and 7(c), in the event of a change in control of
the Company, (i) all of the Optionee's then outstanding Options shall
immediately become exercisable, unless directed otherwise by a resolution
adopted by the Board prior to and specifically relating to the occurrence of
such change in control, and (ii) each Optionee shall have the right within one
(1) year after such event to exercise the Option in full notwithstanding any
limitation or restriction in any Option Agreement or in the Plan.
(b) For purposes of this Section 7, a "change in control" shall mean
a change in control with respect to the Company, occurring on or after the
Second Closing Date, that would be required to be reported in response to Item 1
(a) of the Current Report on Form 8-K, as in effect on the Second Closing Date,
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"); provided that, without limitation, such a change
in control shall be deemed to have occurred at such time as any "person" (as
defined in Section 3(9) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly
of 20% or more of the securities of the Company which are entitled to vote.
Notwithstanding anything aforesaid to the contrary, a change in control with
respect to the Company shall be deemed to have occurred if individuals who
constitute the Board on the Second Closing Date, cease for any reason to
constitute at least a majority of the Board.
(c) In no event, however, may any Option be exercised (i) prior to
the expiration of six (6) months from the date of grant, or (ii) after ten (10)
years from the date it was granted.
8. Purchase for Investment. (a) Except as hereafter provided, the
holder of an Option shall, upon any exercise thereof, execute and deliver to the
Company a written statement, in form satisfactory to the Company, in which such
holder represents and warrants that such holder is purchasing or acquiring the
shares acquired thereunder for such holder's own account, for investment only
and not with a view to the resale or distribution thereof, and represents and
agrees that any subsequent offer for sale or distribution of any of such shares
shall be made only pursuant to either (i) a registration statement on an
appropriate form under the Securities Act of 1933, as amended (the "Securities
Act"), which registration statement has become effective and is current with
regard to the shares being offered or sold, or (ii) a specific exemption from
the registration requirements of the Securities Act, but in claiming such
exemption the holder shall, prior to any offer for sale or sale of such shares,
obtain a prior favorable written opinion, in form and substance satisfactory to
the Company, from counsel for or approved by the Company, as to the
applicability of such exemption thereto. The foregoing restriction shall not
apply to (a) issuances by the Company so long as the shares being issued are
registered under the Securities Act and a prospectus in respect thereof is
current or (b) reofferings of shares by affiliates of the Company (as defined in
Rule 405 or any successor rule or regulation promulgated under the Securities
Act) if the shares being reoffered are registered under the Securities Act and a
prospectus in respect thereof is current.
(b) The Company may endorse such legend or legends upon the
certificates for shares issued upon exercise of an Option granted hereunder and
may issue such "stop transfer" instructions to its transfer agent in respect of
such shares as, in its discretion, it determines to be necessary or appropriate
to prevent a violation of, or to perfect an exemption from, the registration
requirements of the Securities Act.
9. Adjustment in the Event of Change in Stock; Reorganization. (a)
In the event of changes in the outstanding Common Stock of the Company after the
Second Closing Date by reason of stock dividend, reverse split, subdivision,
recapitalization, split-up, combination or exchange of shares, reorganization or
liquidation, extraordinary dividend payable in cash or property, and the like,
the aggregate number and class of shares available under the Plan, and the
number, class and the price of shares of Common Stock subject to outstanding
Options shall be appropriately adjusted by the Board, whose determination shall
be conclusive.
(b) In the event (i) the Company is merged or consolidated with
another corporation and the company is not the surviving corporation, or the
Company shall be the surviving corporation and there shall be any change in the
Common Stock of the Company by reason of such merger or consolidation, or (ii)
all or substantially all of the assets of the Company are acquired by another
corporation, or (iii) there is a reorganization or liquidation of the Company
(each such event being hereinafter referred to as a "Reorganization Event"), or
(iv) the Board shall propose that the Company enter into a Reorganization Event,
then the Board (acting solely through members of the Board who were members of
the Board prior to the occurrence of the Reorganization Event) may in its
discretion take any or all of the following actions:
(A) by written notice to Optionee, provide that the
Option shall be terminated unless exercised within thirty days (or
such longer period as the Board shall determine in its discretion)
after the date of such notice; and
(B) advance the dates upon which any or all outstanding
Options granted to Optionee shall be exercisable.
Whenever deemed appropriate by the Board, any action
referred to in this Section 9(b) may be made conditional upon the
consummation of the applicable Reorganization Event.
(c) Any adjustments or other action pursuant to this Section 9 shall
be made by the Board and the Board's determination as to what adjustments shall
be made or actions taken, and the extent thereof, shall be final and binding.
10. Administration. The Plan shall be administered by the Board. The
Board shall have all the powers vested in it by the terms of the Plan, such
powers to include authority (within the limitations described herein) to
prescribe the form of all Option Agreements. The Board shall, subject to the
provisions of the Plan, have the power to construe the Plan, to determine all
questions arising thereunder and to adopt and amend such rules and regulations
for the administration of the Plan as it may deem desirable. Any decision of the
Board in the administration of the Plan, as described herein, shall be final and
conclusive. The Board may act only by a majority of its members in office,
except that the members thereof may authorize any one or more of their number or
the secretary or any other officer of the Company to execute and deliver
documents on behalf of the Board. No member of the Board shall be liable for
anything done or omitted to be done by such member or by any other member of the
Board in connection with the Plan, except as may expressly be provided by
statute.
11. Miscellaneous Provisions. (a) Except as expressly provided for
in the Plan, no director or other person shall have any claim or right to be
granted an Option under the Plan. Neither the Plan nor any action taken
hereunder shall be construed as giving any eligible director any right to be
retained in the service of the Company as a director or otherwise.
(b) An Optionee's rights and interest under the Plan may not be
assigned or transferred in whole or in part either directly or by operation of
law or otherwise (except in the event of an Optionee's death, by will or the
laws of descent and distribution), including, but not by way of limitation,
execution, levy, garnishment, attachment, pledge, bankruptcy or in any other
manner, and no such right or interest of any participant in the Plan shall be
subject to any obligation or liability of such participant.
(c) It shall be a condition to the obligation of the Company to
issue shares of Common Stock upon exercise of an Option that the Optionee (or
any beneficiary or person entitled to act) pay to the Company, upon its demand,
such amount, in cash and/or Common Stock, as may be requested by the Company for
the purpose of satisfying its liability, if any, to withhold federal, state,
local or foreign income or other taxes; provided, however, that such withholding
obligation may be met by the withholding of Common Stock otherwise deliverable
to the Optionee in accordance with such procedures as may be adopted by the
Board; provided, further, however, the amount of Common Stock so withheld shall
not exceed the minimum required withholding obligation. If the amount requested
is not paid, the Company may refuse to issue the shares of Common Stock.
(d) The expenses of the Plan shall be borne by the Company.
(e) The Plan shall be unfunded. Neither the Company nor the Board
shall be required to establish any special or separate fund or to make any other
segregation of assets to assure the issuance of shares upon exercise of any
Option under the Plan and issuance of shares upon exercise of Options shall be
subordinate to the claims of the Company's general creditors. Proceeds from the
sale of shares pursuant to Options however shall constitute general funds of the
Company. Neither the Company, a Subsidiary or the Board shall be deemed to be a
trustee of any amounts to be paid under the Plan.
(f) By accepting any Option or other benefit under the Plan, each
Optionee and each person claiming under or through such person shall be
conclusively deemed to have indicated his acceptance and ratification, and
consent to, any action taken under the Plan by the Company or the Board.
(g) An Optionee shall have no voting rights or other rights of
stockholders with respect to shares which are subject to an Option, nor shall
cash dividends accrue or be payable with respect to any such shares.
(h) The Plan shall be governed by and construed in accordance with
the laws of the State of New York.
(i) No fractional shares shall be issued upon the exercise of an
Option. If a fractional share shall become subject to an Option by reason of a
stock dividend or otherwise, the Optionee shall not be entitled to exercise the
Option with respect to such fractional share.
12. Amendment or Discontinuance. Except as provided in this Section
12, the Plan may be amended at any time and from time to time by the Board as
the Board shall deem advisable including, but not limited to amendments
necessary to qualify for any exemption or to comply with applicable law or
regulations. Except as provided in Section 9 above, the Board may not, without
further approval by the stockholders of the Company, increase the maximum number
of shares of Common Stock as to which Options may be granted under the Plan,
increase the number of shares subject to an Option, reduce the Option exercise
price described in Section 5(a), extend the period during which Options may be
granted or exercised under the Plan or change the class of persons eligible to
receive Options under the Plan. No amendment of the Plan shall materially and
adversely affect any right of any Optionee with respect to any Option
theretofore granted without such Optionee's written consent.
13. Limits of Liability. (a) Any liability of the Company to any
participant with respect to an Option award shall be based solely upon
contractual obligations, if any, created by the Plan and the Option Agreement.
(b) Neither the Company nor or any member of the Board, nor any
other person participating in any determination of any question under the Plan,
or in the interpretation, administration or application of the Plan, shall have
any liability to any party for any action taken or not taken in connection with
the Plan, except as may expressly be provided by statute.
14. Termination. This Plan shall terminate upon the earlier of the
following dates or events to occur:
(a) upon the adoption of a resolution of the Board terminating
the Plan;
(b) the date all shares of Common Stock subject to the Plan are
purchased according to the Plan's provisions; or
(c) ten years from the Second Closing Date.
No such termination of this Plan shall affect the rights of any Optionee
hereunder and all Options previously granted hereunder shall continue in force
and in operation after termination of the Plan, except as they may be otherwise
terminated in accordance with the terms of the Plan.
<PAGE>
EXHIBIT C
MARINE TRANSPORT CORPORATION
AMENDED AND RESTATED
1998 INCENTIVE EQUITY PLAN
--------------------------
1. Purpose. The purpose of the Marine Transport Corporation 1998
Incentive Equity Plan (the "Plan") is to maintain the ability of Marine
Transport Corporation (the "Company") and its subsidiaries to attract and retain
highly qualified and experienced employees and to give such employees a
continued proprietary interest in the success of the Company and its
subsidiaries. Pursuant to the Plan, such employees will be offered the
opportunity to acquire common stock through the grant of options, stock
appreciation rights in tandem with such options, the award of restricted stock
under the Plan, bonuses payable in stock or a combination thereof. Unless the
context clearly indicates otherwise, references herein to "option" or "options"
shall include any tandem stock appreciation right that may be granted in
connection with such option or options in accordance with Paragraph 6(f) hereof.
As used herein, the term "subsidiary" shall mean any present or
future corporation which is or would be a "subsidiary corporation" of the
Company as the term is defined in Section 424(f) of the Internal Revenue Code of
1986, as amended from time to time (the "Code"). References to the "Exchange
Act" are to the Securities Exchange Act of 1934, as it may be amended from time
to time.
2. Administration of the Plan. The Plan shall be administered by a
compensation committee (the "Committee") as appointed from time to time by the
Board of Directors of the Company (the "Board"), which Committee shall consist
of not less than three (3) members of the Board who are "outside directors" for
purposes of Section 162(m) of the Code. No member of the Committee shall be
eligible to be granted options or awarded restricted stock or bonuses payable in
stock under the Plan. No member of the Board shall be appointed to the Committee
who has been granted an option or awarded restricted stock or bonuses payable in
stock under the Plan within one year prior to appointment. A majority of the
members of the Committee shall constitute a quorum. The vote of a majority of a
quorum shall constitute action by the Committee.
In administering the Plan, the Committee may adopt rules and
regulations for carrying out the Plan. The interpretation and decision with
regard to any question arising under the Plan made by the Committee shall be
final and conclusive on all employees of the Company and its subsidiaries
participating or eligible to participate in the Plan. The Committee may consult
with counsel, who may be counsel to the Company, and shall not incur any
liability for any action taken in good faith in reliance upon the advice of
counsel. The Committee shall determine the employees to whom, and the time or
times at which, grants or awards shall be made and the number of shares to be
included in the grants or awards. Within the limitations of the Plan, the number
of shares for which options will be granted from time to time and the periods
for which the options will be outstanding will be determined by the Committee.
Each option or stock or other awards granted pursuant to the Plan
shall be evidenced by an Option Agreement or Award Agreement (the "Agreement").
The Agreement shall not be a precondition to the granting of options or stock or
other awards; however, no person shall have any rights under any option or stock
or other awards granted under the Plan unless and until the person to whom such
option or stock or other award shall have been granted shall have executed and
delivered to the Company an Agreement. The Committee shall prescribe the form of
all Agreements. A fully executed original of the Agreement shall be provided to
both the Company and the recipient of the grant or award.
3. Shares of Stock Subject to the Plan. The total number of shares
that may be optioned or awarded under the Plan is 825,000 shares of the $0.50
par value common stock of the Company (the "Common Stock"), of which no more
than _____ shares may be optioned or awarded to any person during any year,
except that said number of shares shall be adjusted as provided in Paragraph 13.
Any shares subject to an option which for any reason expires or is terminated
unexercised and any restricted stock which is forfeited may again be optioned or
awarded under the Plan. Shares subject to the Plan may be either authorized and
unissued shares or issued shares acquired by the Company or its subsidiaries.
4. Eligibility. Key salaried employees, including officers, of the
Company and its subsidiaries (but excluding non-employee directors) are eligible
to be granted options and awarded restricted stock under the Plan and to have
their bonuses payable in stock. The employees who shall receive awards or
options under the Plan shall be selected from time to time by the Committee, in
its sole discretion, from among those eligible, which may be based upon
information furnished to the Committee by the Company's management, and the
Committee shall determine, in its sole discretion, the number of shares to be
covered by the award or awards and by the option or options granted to each such
employee selected. Such key salaried employees who are selected to participate
in the Plan shall be referred to collectively herein as "Participants."
5. Duration of the Plan. No award or option may be granted under the
Plan more than ten years from the date the Plan is adopted by the Board or the
date the Plan receives shareholder approval, whichever is earlier, but awards or
options theretofore granted may extend beyond that date.
6. Terms and Conditions of Stock Options. All options granted under
this Plan shall be either incentive stock options, as defined in Section 422 of
the Code, or options other than incentive stock options. Each such option shall
be subject to all the applicable provisions of the Plan, including the following
terms and conditions, and to such other terms and conditions not inconsistent
therewith as the Committee shall determine.
(a) The option price per share shall be determined by the
Committee. However, subject to Paragraph 6(k), the option price of
(i) incentive stock options and (ii) options granted to persons who
are "covered persons" for purposes of Section 162(m) of the Code
shall not be less than 100% of the fair market value of a share of
Common Stock at the time the option is granted. For purposes of the
Plan, the fair market value on any date, means (i) if the Common
Stock is listed on a securities exchange or is traded over the
Nasdaq National Market System, the closing sales price on such
exchange or over such system on such date or, in the absence of
reported sales on such date, the closing sales price on the
immediately preceding date on which sales were reported, or (ii) if
the Common Stock is not listed on a securities exchange or traded
over the Nasdaq National Market System, the mean between the bid and
offered prices as quoted by the National Association of Securities
Dealers through Nasdaq for such date, provided that if it is
determined that the fair market value is not properly reflected by
such Nasdaq quotations, fair market value will be determined by such
other method as the Committee determines in good faith to be
reasonable.
(b) Each option shall be exercisable pursuant to the
attainment of such performance goals and/or during and over such
period ending not later than ten years from the date it was granted,
as may be determined by the Committee and stated in the Agreement.
In no event may an option be exercised more than 10 years from the
date the option was granted.
(c) Unless otherwise provided in the Agreement, no option
shall be exercisable within six months from the date of the granting
of the option. An option shall not be exercisable with respect to a
fractional share of Common Stock or with respect to the lesser of
fifty (50) shares or the full number of shares then subject to the
option. No fractional shares of Common Stock shall be issued upon
the exercise of an option. If a fractional share of Common Stock
shall become subject to an option by reason of a stock dividend or
otherwise, the optionee shall not be entitled to exercise the option
with respect to such fractional share.
(d) Each Option Agreement shall state whether the option(s)
evidenced thereby will or will not be treated as incentive stock
option(s).
(e) Each option may be exercised by giving written notice to
the Company specifying the number of shares to be purchased, which
shall be accompanied by payment in full including, if required by
applicable law, taxes, if any. Payment, except as provided in the
Agreement, shall be
(A) in United States dollars by check or bank
draft, or
(B) by tendering to the Company Common Stock shares
already owned for at least six months by the person exercising
the option, which may include shares received as the result of
a prior exercise of an option, and having a fair market value,
as determined in accordance with Paragraph 6(a), on the date
on which the option is exercised equal to the cash exercise
price applicable to such option, or
(C) by a combination of United States dollars and Common
Stock shares as aforesaid, or
(D) in accordance with a cashless exercise program
established by the Committee in its sole discretion under
which either (A) if so instructed by the optionee, shares may
be issued directly to the optionee's broker or dealer upon
receipt of the purchase price in cash from the broker or
dealer, or (B) shares may be issued by the Company to an
optionee's broker or dealer in consideration of such broker's
or dealer's irrevocable commitment to pay to the Company that
portion of the proceeds from the sale of such shares that is
equal to the exercise price of the option(s) relating to such
shares, or
(E) in such other manner as permitted by the Committee
at the time of grant or thereafter.
No optionee shall have any rights to dividends or other rights
of a shareholder with respect to shares of Common Stock subject to
his or her option until he or she has given written notice of
exercise of his or her option and paid in full for such shares.
(f) Notwithstanding the foregoing, the Committee may, in its
sole discretion, grant to a grantee of an option the right
(hereinafter referred to as a "stock appreciation right") to elect,
in the manner described below, in lieu of exercising his or her
option for all or a portion of the shares of Common Stock covered by
such option, to relinquish his or her option with respect to any or
all of such shares and to receive from the Company a payment having
a value equal to the amount by which (a) the fair market value, as
determined in accordance with Paragraph 6(a), of a share of Common
Stock on the date of such election, multiplied by the number of
shares as to which the grantee shall have made such election,
exceeds (b) the total exercise price for that number of shares of
Common Stock under the terms of such option; provided, however, that
to the extent that a stock appreciation right is exercised by a
Participant who is or may be subject to Section 16 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), during the
ten-day election period described in Rule 16b-3(e) of the Exchange
Act, the amount described in Paragraph 6(f)(a) next above shall be
equal to the highest fair market value of the shares of Common Stock
during such ten-day election period. A stock appreciation right
shall be exercisable at the time the tandem option is exercisable,
and the "expiration date" for the stock appreciation right shall be
the expiration date for the tandem option. A grantee who makes such
an election shall receive payment in the sole discretion of the
Committee (i) in cash equal to such excess; or (ii) in the nearest
whole number of shares of Common Stock of the Company having an
aggregate fair market value, as determined in accordance with
Paragraph 6(a), which is not greater than the cash amount calculated
in (i) above; or (iii) a combination of (i) and (ii) above. A stock
appreciation right may be exercised only when the amount described
in (a) above exceeds the amount described in (b) above. An election
to exercise stock appreciation rights shall be deemed to have been
made on the day written notice of such election, addressed to the
Committee, is received at the Company's offices. An option or any
portion thereof with respect to which a grantee has elected to
exercise the stock appreciation rights described above shall be
surrendered to the Company and such option shall thereafter remain
exercisable according to its terms only with respect to the number
of shares as to which it would otherwise be exercisable, less the
number of shares with respect to which stock appreciation rights
have been exercised. The grant of a stock appreciation right shall
be evidenced by such form of Agreement as the Committee may
prescribe. The Agreement evidencing stock appreciation rights shall
be personal and will provide that the stock appreciation rights will
not be transferable by the grantee otherwise than by will or the
laws of descent and distribution and that they will be exercisable,
during the lifetime of the grantee, only by him or her.
(g) Except as provided in the Agreement, an option may be
exercised only if at all times during the period beginning with the
date of the granting of the option and ending on the date of such
exercise, the grantee was an employee of either the Company or of a
subsidiary of the Company or of another corporation referred to in
Section 421(a)(2) of the Code. The Agreement shall provide whether,
and if so, to what extent, an option may be exercised after
termination of continuous employment, but any such exercise shall in
no event be later than the termination date of the option. If the
grantee should die, or become permanently disabled as determined by
the Committee in accordance with the Agreement, at any time when the
option, or any portion thereof, shall be exercisable by him or her,
the option will be exercisable within a period provided for in the
Agreement, by the optionee or person or persons to whom his or her
rights under the option shall have passed by will or by the laws of
descent and distribution, but in no event at a date later than the
termination of the option. The Committee may require medical
evidence of permanent disability, including medical examinations by
physicians selected by it.
(h) The option by its terms shall be personal and shall not be
transferable by the optionee otherwise than by will or by the laws
of descent and distribution as provided in Paragraph 6(g) above.
During the lifetime of an optionee, the option shall be exercisable
only by the optionee. In the event any option is exercised by the
executors, administrators, heirs or distributees of the estate of a
deceased optionee as provided in Paragraph 6(g) above, the Company
shall be under no obligation to issue Common Stock thereunder unless
and until the Company is satisfied that the person or persons
exercising the option are the duly appointed legal representative of
the deceased optionee's estate or the proper legatees or
distributees thereof.
(i) Notwithstanding any intent to grant incentive stock
options, an option granted will not be considered an incentive stock
option to the extent that it together with any earlier incentive
stock options permits the exercise for the first time in any
calendar year of more than $100,000 in fair market value of Common
Stock (determined in accordance with Paragraph 6(a) at the time of
grant).
(j) The Committee may, but need not, require such
consideration from an optionee at the time of granting an option as
it shall determine, either in lieu of, or in addition to, the
limitations on exercisability provided in Paragraph 6(e).
(k) No incentive stock option shall be granted to an employee
who owns or would own immediately before the grant of such option,
directly or indirectly, stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company. This
restriction does not apply if, at the time such incentive stock
option is granted, the option price is at least 110% of the fair
market value of one share of Common Stock, as determined in
accordance with Paragraph 6(a), on the date of grant and the
incentive stock option by its terms is not exercisable after the
expiration of five years from the date of grant.
(l) An option and any Common Stock received upon the exercise
of an option shall be subject to such other transfer restrictions
and/or legending requirements that are specified in the Agreement.
7. Terms and Conditions of Restricted Stock Awards. All awards of
restricted stock under the Plan shall be subject to all the applicable
provisions of the Plan, including the following terms and conditions, and to
such other terms and conditions not inconsistent therewith, as the Committee
shall determine.
(a) Awards of restricted stock may be in addition to or in
lieu of option grants.
(b) During a period set by, and/or until the attainment of
particular performance goals established by, the Committee at the
time of each award of restricted stock (the "restriction period") as
specified in the Agreement, the recipient shall not be permitted to
sell, transfer, pledge, or otherwise encumber the shares of
restricted stock; except that such shares may be used, if the
Agreement permits, to pay the option price of any option granted
under the Plan provided an equal number of shares delivered to the
recipient shall carry the same restrictions as the shares so used.
For purposes of the preceding sentence, the performance goals (if
any) established by the Committee shall be based upon one or more of
the following criteria: [earnings per share, net profits, return on
equity, etc. Note: specific criteria require shareholder approval].
(c) If so provided in the Agreement, shares of restricted
stock shall become free of all restrictions if (i) the recipient
dies, (ii) the recipient's employment terminates by reason of
permanent disability, as determined by the Committee, (iii) the
recipient retires under specific circumstances set forth in the
Agreement, or (iv) there is a "change in control" of the Company (as
defined in the Agreement). The Committee may require medical
evidence of permanent disability, including medical examinations by
physicians selected by it. If the Committee determines that any such
recipient is not permanently disabled, the restricted stock held by
such recipient shall be forfeited and revert to the Company.
(d) Unless and to the extent otherwise provided in the
Agreement in accordance with Paragraph 7(c) hereof, shares of
restricted stock shall be forfeited and revert to the Company upon
the recipient's termination of employment during the restriction
period, except to the extent the Committee, in its sole discretion,
finds that such forfeiture might not be in the best interest of the
Company and, therefore, waives all or part of the application of
this provision to the restricted stock held by such recipient.
(e) Stock certificates for restricted stock shall be
registered in the name of the recipient but shall be appropriately
legended and returned to the Company by the recipient, together with
a stock power, endorsed in blank by the recipient. The recipient
shall be entitled to vote shares of restricted stock and shall be
entitled to all dividends paid thereon, except that dividends paid
in Common Stock or other property shall also be subject to the same
restrictions.
(f) Restricted stock shall become free of the foregoing
restrictions upon expiration of the applicable restriction period
and the Company shall then deliver Common Stock certificates
evidencing such stock to the recipient.
(g) Restricted stock and any Common Stock received upon the
expiration of the restriction period shall be subject to such other
transfer restrictions and/or legending requirements that are
specified in the Agreement.
8. Bonuses Payable in Stock. In lieu of cash bonuses otherwise
payable under the Company's or applicable subsidiary's compensation practices to
employees eligible to participate in the Plan, the Committee, in its sole
discretion, may determine that such bonuses shall be payable in Common Stock or
partly in Common Stock and partly in cash. Such bonuses shall be in
consideration of services previously performed and as an incentive toward future
services and shall consist of shares of Common Stock subject to such terms as
the Committee may determine in its sole discretion. The number of shares of
Common Stock payable in lieu of a bonus otherwise payable shall be determined by
dividing such amount by the fair market value of one share of Common Stock on
the date the bonus is payable, with fair market value determined as of such date
in accordance with Paragraph 6(a).
9. Change in Control.
(a) In the event of a change in control of the Company, as
defined by the Committee in the Agreement, the Committee may, in its
sole discretion, provide that any of the following applicable
actions be taken as a result, or in anticipation, of any such event
to assure fair and equitable treatment of Participants:
(i) accelerate restriction periods for purposes of
vesting in, or realizing gain from, any outstanding option or
shares of restricted stock awarded pursuant to this Plan;
(ii) offer to purchase any outstanding option or shares
of restricted stock made pursuant to this Plan from the holder
for its equivalent cash value, as determined by the Committee,
as of the date of the change in control; or
(iii) make adjustments or modifications to outstanding
options or with respect to restricted stock as the Committee
deems appropriate to maintain and protect the rights and
interests of the Participants following such change in
control.
Any such action approved by the Committee shall be conclusive and
binding on the Company, its subsidiaries and all Participants.
(b) In no event, however, may (i) any option be exercised
prior to the expiration of six (6) months from the date of grant
(unless otherwise provided for in the Agreement), or (ii) any option
be exercised after ten (10) years from the date it was granted.
10. Transfer, Leave of Absence. For the purpose of the Plan: (a) a
transfer of an employee from the Company to a subsidiary or affiliate of the
Company, whether or not incorporated, or vice versa, or from one subsidiary or
affiliate of the Company to another, and (b) a leave of absence, duly authorized
in writing by the Company or a subsidiary or affiliate of the Company, shall not
be deemed a termination of employment.
11. Rights of Employees.
(a) No person shall have any rights or claims under the Plan
except in accordance with the provisions of the Plan and the
Agreement.
(b) Nothing contained in the Plan or Agreement shall be deemed
to give any employee the right to be retained in the service of the
Company or its subsidiaries.
12. Tax Withholding Obligations.
(a) If required by applicable law, the payment of taxes, upon
the exercise of an option pursuant to Paragraph 6(e) or a stock
appreciation right pursuant to Paragraph 6(f), shall be in cash at
the time of exercise or on the applicable tax date under Section 83
of the Code, if later; provided, however, tax withholding
obligations may be met by the withholding of Common Stock otherwise
deliverable to the optionee pursuant to procedures approved by the
Committee; provided, further, however, the amount of Common Stock so
withheld shall not exceed the minimum required withholding
obligation.
(b) If required by applicable law, recipients of restricted
stock, pursuant to Paragraph 7, shall be required to pay taxes to
the Company upon the expiration of restriction periods or such
earlier dates as elected pursuant to Section 83 of the Code;
provided, however, tax withholding obligations may be met by the
withholding of Common Stock otherwise deliverable to the recipient
pursuant to procedures approved by the Committee. If tax withholding
is required by applicable law, in no event shall Common Stock be
delivered to any awardee until he has paid to the Company in cash
the amount of such tax required to be withheld by the Company or has
elected to have his withholding obligations met by the withholding
of Common Stock in accordance with the procedures approved by the
Committee or otherwise entered into an agreement satisfactory to the
Company providing for payment of withholding tax.
(c) The Company shall first withhold from any cash bonus
described in Paragraph 8, an amount of cash sufficient to meet its
tax withholding obligations before the amount of Common Stock paid
in accordance with Paragraph 8 is determined.
13. Changes in Capital; Reorganization. (a) Upon changes in the
outstanding Common Stock after the Second Closing Date by reason of a stock
dividend, stock split, reverse split, subdivision, recapitalization, an
extraordinary dividend payable in cash or property, combination or exchange of
shares, separation, reorganization or liquidation, and the like, the aggregate
number and class of shares available under the Plan as to which stock options
and restricted stock may be awarded, the number and class of shares under (i)
each option and the option price per share and (ii) each award of restricted
stock shall, in each case, be correspondingly adjusted by the Committee, such
adjustments to be made in the case of outstanding options without change in the
total price applicable to such options.
(b) In the event (i) the Company is merged or consolidated with
another corporation and the Company is not the surviving corporation, or the
Company shall be the surviving corporation and there shall be any change in the
Common Stock of the Company by reason of such merger or consolidation, or (ii)
all or substantially all of the assets of the Company are acquired by another
corporation, or (iii) there is a reorganization or liquidation of the Company
(each such event being hereinafter referred to as a "Reorganization Event"), or
(iv) the Board of Directors of the Company shall propose that the Company enter
into a Reorganization Event, then the Board (acting solely through members of
the Board who were members of the Board prior to the occurrence of the
Reorganization Event) may in its discretion take any or all of the following
actions:
(A) by written notice to the holders of stock options or
restricted stock awards, provide that the stock options or
restricted stock awards shall be terminated unless exercised within
thirty days (or such longer period as the Board shall determine in
its discretion) after the date of such notice; and
(B) advance the dates upon which any or all outstanding
stock options and restricted stock awards granted shall be
exercisable.
Whenever deemed appropriate by the Board, any action referred to in
this Section 13(b) may be made conditional upon the consummation of the
applicable Reorganization Event.
(c) Any adjustments or other action pursuant to this Section 13
shall be made by the Board and the Board's determination as to what adjustments
shall be made or actions taken, and the extent thereof, shall be final and
binding.
14. Miscellaneous Provisions.
(a) The Plan shall be unfunded. The Company shall not be
required to establish any special or separate fund or to make any
other segregation of assets to assure the issuance of shares or the
payment of cash upon exercise of any option or stock appreciation
right under the Plan. Proceeds from the sale of shares of Common
Stock pursuant to options granted under this Plan shall constitute
general funds of the Company. The expenses of the Plan shall be
borne by the Company.
(b) It is understood that the Committee may, at any time and
from time to time after the granting of an option or the award of
restricted stock or bonuses payable in Common Stock hereunder,
specify such additional terms, conditions and restrictions with
respect to such option or stock as may be deemed necessary or
appropriate to ensure compliance with any and all applicable laws,
including, but not limited to, terms, restrictions and conditions
for compliance with federal and state securities laws and methods of
withholding or providing for the payment of required taxes.
(c) If at any time the Committee shall determine, in its
discretion, that the listing, registration or qualification of
shares of Common Stock upon any national securities exchange or
under any state or federal law, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the sale or purchase of shares
of Common Stock hereunder, no option may be exercised or restricted
stock or stock bonus may be transferred in whole or in part unless
and until such listing, registration, qualification, consent or
approval shall have been effected or obtained, or otherwise provided
for, free of any conditions not acceptable to the Committee.
(d) By accepting any benefit under the Plan, each Participant
and each person claiming under or through such Participant shall be
conclusively deemed to have indicated his acceptance and
ratification, and consent to, any action taken under the Plan by the
Committee, the Company or the Board.
(e) The Plan shall be governed by and construed in accordance
with the laws of the State of New York.
15. Limits of Liability.
(a) Any liability of the Company or a subsidiary of the
Company to any Participant with respect to any option or award shall
be based solely upon contractual obligations created by the Plan and
the Agreement.
(b) Neither the Company nor a subsidiary of the Company, nor
any member of the Committee or the Board, nor any other person
participating in any determination of any question under the Plan,
or in the interpretation, administration or application of the Plan,
shall have any liability to any party for any action taken or not
taken in connection with the Plan, except as may expressly be
provided by statute.
16. Amendments and Termination. The Board may, at any time, amend,
alter or discontinue the Plan; provided, however, no amendment, alteration or
discontinuation shall be made which, without the approval of the shareholders,
would:
(a) except as is provided in Paragraph 13, increase the
maximum number of shares of Common Stock reserved for the purpose of
the Plan;
(b) except as is provided in Paragraph 13, decrease the option
price of an option to less than 100% of the fair market value, as
determined in accordance with Paragraph 6(a), of a share of Common
Stock on the date of the granting of the option;
(c) change the class of persons eligible to receive an award
of restricted stock, options or bonuses payable in Common Stock
under the Plan; or
(d) extend the duration of the Plan.
The Committee may amend the terms of any award of restricted stock
or option theretofore granted, retroactively or prospectively, but no such
amendment shall impair the rights of any holder without his or her written
consent.
17. Duration. The Plan shall be adopted by the Board as of the date
on which it is approved by a majority of the Company's stockholders, which
approval must occur within the period ending twelve months after the date the
Plan is adopted. The Plan shall terminate upon the earliest of the following
dates or events to occur:
(a) the adoption of a resolution of the Board,
terminating the Plan; or
(b) the date all shares of Common Stock subject to the Plan
are purchased according to the Plan's provisions; or
(c) ten years from the Second Closing Date.
