As filed with the Securities and Exchange Commission on February 24, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
SEACOR HOLDINGS, INC.
(Exact Name of Registrant as Specified in its Charter)
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<S> <C>
DELAWARE 13-3542736
(State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.)
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11200 WESTHEIMER, SUITE 850
HOUSTON, TEXAS 77042
(713) 782-5990
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
MR. RANDALL BLANK
EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND SECRETARY
SEACOR HOLDINGS, INC.
1370 AVENUE OF THE AMERICAS, 25TH FLOOR
NEW YORK, NEW YORK 10019
(212) 307-6633
(NAME, ADDRESS, INCLUDING ZIP CODE,
AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
Copy to:
David E. Zeltner, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
(212) 310-8000
Approximate date of commencement of proposed sale to the public: From time to
time after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [_]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_] __________
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] __________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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CALCULATION OF REGISTRATION FEE(1)
==================================================================================================================================
Proposed Maximum Proposed Maximum
Title of Each Class of Securities to be Amount to be Offering Price Aggregate Offering Amount of Registration
Registered Registered Per Unit (1) Price (1) Fee
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5-3/8% Convertible Subordinated Notes Due $187,750,000 100% $187,750,000 $56,893.94
November 15, 2006
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Common Stock, par value $.01 per share 2,844,694(2) - - -
==================================================================================================================================
<FN>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(i) under the Securities Act of 1933, as amended
(the "Securities Act").
(2) Such number represents the number of shares of Common Stock that are
issuable upon conversion of the 5-3/8% Convertible Subordinated Notes
Due November 15, 2006 registered hereby.
</FN>
</TABLE>
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act or until the Registration Statement shall become effective on
such date as the Securities and Exchange Commission, acting pursuant to said
Section 8(a), may determine.
================================================================================
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any state in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such state.
SUBJECT TO COMPLETION, DATED FEBRUARY 24, 1997
PROSPECTUS
SEACOR HOLDINGS, INC.
$187,750,000
Aggregate Principal Amount of
5-3/8% Convertible Subordinated Notes Due November 15, 2006
2,844,694
Shares of Common Stock Issuable Upon The Conversion Thereof
($.01 Par Value)
This Prospectus relates to the offer and sale of up to $187,750,000
aggregate principal amount of the 5-3/8% Convertible Subordinated Notes Due
November 15, 2006 (the "Notes") of SEACOR Holdings, Inc., a Delaware corporation
("SEACOR" or the "Company"), and up to 2,844,694 shares (the "Shares") of the
common stock, $.01 par value (the "Common Stock"), of the Company issuable upon
the conversion of the Notes in full (collectively, the "Securities"). The Notes
were issued under an Indenture dated as of November 1, 1996 (the "Indenture"),
between the Company and First Trust National Association, as trustee (the
"Trustee"). The Notes are convertible, in whole or in part, at the option of the
holder at any time prior to the close of business on the business day next
preceding November 15, 2006, unless previously redeemed, into shares of Common
Stock at a conversion price of $66.00 per share (equivalent to a conversion rate
of 15.1515 shares of Common Stock per $1,000 principal amount of the Notes),
subject to adjustment in certain circumstances. The Notes are redeemable, in
whole or in part, at the Company's option at any time on or after November 24,
1999 at the redemption prices specified therein, together with accrued and
unpaid interest to the date of redemption. No sinking fund is provided for the
Notes. If a "Change of Control" (as defined in the Indenture) occurs, holders of
Notes may elect to require the Company to purchase their Notes, in whole or in
part, at a purchase price equal to 100% of the principal amount thereof plus
accrued interest through the date of purchase. The Notes are general unsecured
obligations of the Company, subordinated in right of payment to all "Senior
Indebtedness" (as defined in the Indenture) of the Company and effectively
subordinated in right of payment to all indebtedness and other obligations and
liabilities and any preferred stock of the Company's subsidiaries. The Notes
will mature on November 15, 2006 and bear interest at a rate of 5-3/8% per annum
from November 5, 1996, in the case of the Initial Notes (defined below), and
December 19, 1996, in the case of the Smit Notes (defined below), or, in each
case, from the most recent interest payment date on which interest has been paid
or provided for. Interest is payable on May 15 and November 15 of each year,
commencing on May 15, 1997 to the holders thereof on May 1 and November 1,
respectively, preceding such interest payment date. See "Description of Notes."
The Securities may be offered for sale by certain securityholders of
the Company or by certain permitted transferees (the "Selling Securityholders")
from time to time in transactions effected on The New York Stock Exchange, Inc.
("NYSE") (or through the facilities of any national securities exchange or U.S.
inter-dealer quotation system of a registered national securities association on
which the Securities are then listed, admitted to unlisted trading privileges or
included for quotation), in privately negotiated transactions, or in a
combination of such methods of sale. Such methods of sale may be conducted at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Securityholders
may effect such transactions directly, or indirectly through underwriters,
broker-dealers or agents acting on their behalf, and in connection with such
sales, such broker-dealers or agents may receive compensation in the form of
commissions, concessions, allowances or discounts from the Selling
Securityholders and/or the purchasers of the Securities for whom they may act as
agent or to whom they sell Securities as principal or both (which commissions,
concessions, allowances or discounts might be in excess of customary amounts
thereof). To the extent required by law, the names of any agents, broker-dealers
or underwriters and applicable commissions, concessions, allowances or discounts
and any other required information with respect to any particular offer of
Securities by the Selling Securityholders, will be set forth in a Prospectus
Supplement. See "Selling Securityholders" and "Plan of Distribution." Certain
restrictions on the ability of the Selling Securityholders to sell Securities
owned by them are described under "Selling Securityholders" and "Description of
Notes."
None of the proceeds from the sale of the Securities by the Selling
Securityholders will be received by the Company. The Company has agreed to bear
the expenses of registration of the Securities under federal or state securities
laws and to indemnify the Selling Securityholders against certain liabilities,
including liabilities under the Securities Act of 1933, as amended (the
"Securities Act").
The Selling Securityholders and any underwriters, dealers or agents which
participate in the distribution of the Securities may be deemed to be
"underwriters" within the meaning of the Securities Act, and any commission
received by them and any profit realized on the resale of the Securities
purchased by them may be deemed to constitute underwriting commissions,
concessions, allowances or discounts under the Securities Act. See "Plan of
Distribution."
SEE "RISK FACTORS" BEGINNING ON PAGE 12 OF THIS PROSPECTUS FOR A
DISCUSSION OF CERTAIN MATERIAL RISKS THAT SHOULD BE CONSIDERED IN CONNECTION
WITH AN INVESTMENT IN THE SECURITIES OFFERED HEREBY.
The Company has filed the Registration Statement of which this Prospectus
is a part to satisfy its obligations under certain investment and registration
rights agreements. See "Selling Securityholders" and "Description of Notes."
The Common Stock is traded on the NYSE under the symbol "CKH." The closing
sale price of the Common Stock as reported on the NYSE Composite Tape on
February 21, 1997 was $48.75 per share.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this Prospectus is _________ __, 1997.
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Copies of reports, proxy statements, information
statements and other information filed by the Company with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and
also are available for inspection at the Commission's regional offices located
at 500 West Madison, Suite 1400, Chicago, Illinois 60661 and 7 World Trade
Center, Suite 1300, New York, New York 10048, and at the Commission's Web site
at (http://www.sec.gov). Copies of such material also can be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. Such reports, proxy statements,
information statements and other information may also be inspected at the
offices of the NYSE at 20 Broad Street, New York, New York 10005.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments thereto, the "Registration Statement") under
the Securities Act with respect to the Securities. This Prospectus does not
contain all of the information set forth in the Registration Statement, certain
parts of which are omitted in accordance with the rules and regulations of the
Commission. Statements made in this Prospectus as to the contents of any
contract, agreement or other document referred to are not necessarily complete
and, with respect to each such contract, agreement or other document filed as an
exhibit to the Registration Statement, reference is made to the exhibit for a
more complete description of the matter involved, and each such statement is
deemed qualified in its entirety by such reference.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the Commission pursuant
to the Exchange Act (File No. 1-12289) are incorporated by reference in this
Prospectus: (i) the Company's Annual Report on Form 10-K for its fiscal year
ended December 31, 1995 filed with the Commission on March 18, 1996; (ii) the
Company's Quarterly Report on Form 10-Q for its fiscal quarter ended March 31,
1996 filed with the Commission on May 15, 1996; (iii) the Company's Quarterly
Report on Form 10-Q for its fiscal quarter ended June 30, 1996 filed with the
Commission on August 14, 1996; (iv) the Company's Quarterly Report on Form 10-Q
for its fiscal quarter ended September 30, 1996 filed with the Commission on
November 14, 1996; (v) the Company's Current Report on Form 8-K dated May 31,
1996 filed with the Commission on June 7, 1996; (vi) the Company's Current
Report on Form 8-K dated June 6, 1996 filed with the Commission on June 10,
1996; (vii) the Company's Current Report on Form 8-K dated May 31, 1996 filed
with the Commission on June 14, 1996; (viii) the Company's Current Report on
Form 8-K dated October 24, 1996 filed with the Commission on October 24, 1996;
(ix) the Company's Current Report on Form 8-K dated December 19, 1996 filed with
the Commission on December 24, 1996; and (x) the description of the Company's
Common Stock contained in the Company's Registration Statements on Form 8-A
filed with the Commission on November 30, 1992 and October 9, 1996, including
any amendment or report filed for the purposes of updating such description.
All reports and other documents filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date of this Prospectus and prior to the termination of the offering of the
Securities made by this Prospectus shall be deemed to be incorporated herein by
reference and to be a part hereof on and from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or incorporated herein by reference or in any other
subsequently filed document that also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon the written or oral
request of such person, a copy of any and all documents incorporated by
reference in this Prospectus (not including, however, the exhibits to such
documents unless such exhibits are specifically incorporated by reference in
such information). Such requests should be directed to: SEACOR Holdings, Inc.,
1370 Avenue of the Americas, 25th Floor, New York, New York 10019, Attention:
Secretary, telephone number (212) 307-6633.
No person is authorized in connection with any offering made hereby to
give any information or to make any representation other than as contained in
this Prospectus and, if given or made, such information or representation must
not be relied upon as having been authorized by the Company, any Selling
Securityholder or any underwriter. This Prospectus does not constitute an offer
to sell or a solicitation of an offer to buy any of the Securities offered
hereby to any person in any jurisdiction in which it is unlawful to make any
such offer or solicitation. Neither the delivery of this Prospectus nor any sale
made hereunder shall under any circumstance imply that there has been no change
in the affairs of the Company since the date hereof.
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SUMMARY
When included in this Prospectus or in documents incorporated herein by
reference, the words "expects," "intends," "anticipates," "believes,"
"estimates" and analogous expressions are intended to identify forward-looking
statements. Such statements, which include statements contained in "Risk
Factors," inherently are subject to a variety of risks and uncertainties that
could cause actual results to differ materially from those projected. Such risks
and uncertainties include, among others, general economic and business
conditions, industry fleet capacity, changes in foreign and domestic oil and gas
exploration and production activity, competition, changes in foreign political,
social and economic conditions, regulatory initiatives and compliance with
governmental regulations, customer preferences and various other matters, many
of which are beyond the Company's control. These forward-looking statements
speak only as of the date of this Prospectus. The Company expressly disclaims
any obligation or undertaking to release publicly any updates or any change in
the Company's expectations with regard thereto or any change in events,
conditions or circumstances on which any statement is based.
THE COMPANY
The Company is a major provider of offshore marine services to the oil and
gas exploration and production industry and is one of the leading providers of
oil spill response services to owners of tank vessels and oil storage,
processing and handling facilities. The Company operates a diversified fleet of
over 315 vessels primarily dedicated to servicing offshore oil and gas
exploration and production facilities in the U.S. Gulf of Mexico, the North Sea,
offshore West Africa and Mexico. The recent consummation of the Smit Transaction
(defined below) has expanded the Company's global operations by giving it market
presence in the Far East, Latin America and the Mediterranean. Additionally, the
recent consummation of the Galaxie Transaction (defined below) has enlarged the
Company's fleet capacity in the U.S. Gulf of Mexico. The Company's offshore
service vessels deliver cargo and personnel to offshore installations, handle
anchors for drilling rigs and other marine equipment, support offshore
construction and maintenance work and provide standby safety support. The
Company also furnishes vessels for special projects such as well stimulation,
seismic data gathering, freight hauling and line handling. In connection with
its offshore marine services, the Company, through Energy Logistics, Inc.
("ELI"), a joint venture with Baker Energy, a unit of the Michael Baker
Corporation, a U.S. public company, also offers logistics services for the
offshore industry, including the coordination and provision of marine, air and
land transportation, materials handling and storage, inventory control and
"just-in-time" procurement.
The Company's environmental services business principally provides
contractual oil spill response services to those who store, transport, produce
or handle petroleum and certain other non-petroleum oils as required by the Oil
Pollution Act of 1990 ("OPA 90") and various state regulations. The Company's
services, provided primarily through its indirect wholly owned subsidiary,
National Response Corporation ("NRC"), include training for and supervision of
activities in response to oil spill emergencies and the maintenance of
specialized equipment for immediate deployment and spill response. NRC has acted
as the principal oil spill response contractor on several of the largest oil
spills that have occurred in the United States since the enactment of OPA 90.
SEACOR was incorporated in Delaware in December 1989 for the purpose of
acquiring the capital stock of NICOR Marine, Inc. and certain of its marine
affiliates and subsidiaries which, at the time of the acquisition, owned 36 and
managed five vessels, and also to acquire SCF Offshore, Inc. which, at the time
of acquisition, owned two vessels.
SEACOR's principal executive offices are located at 11200 Westheimer,
Suite 850, Houston, Texas 77042, where its telephone number is (713) 782-5990.
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Unless the context indicates otherwise, any reference in this Prospectus
to the "Company" refers to SEACOR Holdings, Inc. and its consolidated
subsidiaries, including NRC, and any references in this Prospectus to "SEACOR"
refer to SEACOR Holdings, Inc.
RECENT DEVELOPMENTS
GALAXIE TRANSACTION
On January 3, 1997, the Company acquired substantially all of the offshore
marine assets, including vessels, owned by Galaxie Marine Service, Inc.,
Moonmaid Marine, Inc., Waveland Marine Service, Inc. and Triangle Marine, Inc.
(collectively, "Galaxie"), for aggregate consideration of $23.61 million,
consisting of $20.56 million in cash and 50,000 shares of Common Stock (the
"Galaxie Transaction"). The assets acquired included 24 vessels (one offshore
supply vessel, one mini supply vessel, five crew boats and 17 utility boats) and
other related tangible and intangible assets.
In connection with the Galaxie Transaction, SEACOR and Galaxie entered
into a certain investment and registration rights agreement, pursuant to which
SEACOR has filed with the Commission a "shelf" registration statement to permit
resales by Galaxie, from time to time, of the 50,000 shares of Common Stock
received by it in the Galaxie Transaction.
SMIT TRANSACTION
On December 19, 1996, the Company and certain of its subsidiaries acquired
substantially all of the offshore vessel assets and certain related joint
venture interests owned by Smit Internationale N.V. ("Smit") and its
subsidiaries (the "Smit Transaction"). The aggregate consideration, including
amounts payable under certain lease purchase arrangements for two vessels,
consists of: (i) approximately $71.1 million in cash, (ii) 712,000 shares of
Common Stock and (iii) up to $22.0 million principal amount of the Company's
Series A 5-3/8% Convertible Subordinated Notes Due November 15, 2006 (the "Smit
Notes"). As of February 18, 1997, the Company has issued $15.25 million
principal amount of the Smit Notes under the Indenture, and the Smit Notes
constitute a portion of the Securities that have been included in the
Registration Statement. The lease purchase agreements provide for the Company to
lease two vessels from Smit over a five-year term for aggregate cash lease
payments of approximately $13.3 million with an obligation to purchase such
vessels at the purchase prices of $5.4 million and $5.6 million, respectively,
at the end of such five-year term. The agreements also provide the Company with
the option to purchase such vessels at any time during the five-year term at
purchase prices specified therein (initially $9.8 million and $10.3 million,
respectively, and declining thereafter), with $3.375 million of the purchase
price for each vessel being payable with Smit Notes (not registered hereby) in
such principal amount. See "Selling Securityholders" and "Description of Notes."
The definitive agreements for the Smit Transaction further provide for the
payment by the Company, in a combination of cash and non-convertible notes, of
up to $47.2 million of additional consideration based upon the 1997 and 1998
earnings performance of the assets acquired from Smit. The acquired assets
include 100% interests in 24 vessels and 50% interests in nine vessels sold
directly by Smit and Smit's interests in joint ventures that own and operate 12
vessels.
As part of the Smit Transaction, SEACOR has also agreed to use
commercially reasonable efforts to nominate and elect to SEACOR's Board of
Directors one person designated by Smit for so long as Smit is the beneficial
owner of at least 5% of the outstanding Common Stock of the Company.
Furthermore, in a press release dated December 19, 1996, SEACOR announced its
intention to change its corporate name to SEACOR SMIT Inc., subject to the
approval of the Company's stockholders at the Company's annual meeting of
stockholders.
In addition, on December 19, 1996, the Company and Smit signed a letter of
intent providing for an entity in which SEACOR or a subsidiary of SEACOR owns an
equity interest to acquire, on or before April 30,
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1997, an additional four vessels (the "Malaysian Purchase") that are owned by a
Malaysian joint venture in which Smit has an interest for aggregate
consideration of approximately $12.9 million. The terms of the Malaysian
Purchase are preliminary in nature and there can be no assurance that any
definitive transaction documentation will be entered into or, if entered into,
that the Malaysian Purchase will be consummated.
In connection with the Smit Transaction, SEACOR and Smit International
Overseas B.V., a Netherlands corporation and wholly-owned subsidiary of Smit
("Smit Overseas"), entered into a certain investment and registration rights
agreement (the "Smit Registration Rights Agreement"), pursuant to which SEACOR
has filed with the Commission the Registration Statement to permit, from time to
time, resales by Smit Overseas of the Smit Notes and the shares of Common Stock
issuable upon the conversion thereof received by it in the Smit Transaction. See
"Selling Securityholders" and "Description of Notes."
5-3/8% CONVERTIBLE SUBORDINATED NOTES PLACEMENT
On November 5, 1996, the Company completed a private placement (the
"November 1996 Notes Placement") of $172.5 million aggregate principal amount of
its 5-3/8% Convertible Subordinated Notes Due November 15, 2006 (the "Initial
Notes"; and together with the Smit Notes, the "Notes"). The Initial Notes were
issued under the Indenture. See "Description of Notes."
The Initial Notes were offered for sale within the United States to
"qualified institutional buyers" (the "144A Notes") in reliance on Rule 144A
under the Securities Act and to a limited number of institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act), and were offered for sale in offshore transactions to investors in
reliance on Regulation S under the Securities Act (the "Reg S Notes"). The
Initial Notes sold to institutional "accredited investors," as well as the Smit
Notes, are represented by definitive certificates, in fully registered form. The
144A Notes are represented by the Restricted Global Note (defined below) in
fully registered form, without coupons, which has been deposited with a
custodian for, and registered in the name of a nominee of, The Depository Trust
Company ("DTC"). The Reg S Notes are represented by a Regulation S Global Note
(defined below) in fully registered form, without coupons, which has been
deposited with a custodian for, and registered in the name of a nominee of, DTC
for the accounts of Morgan Guaranty Trust Company of New York, Brussels office,
as operator of the Euroclear System ("Euroclear") and Cedel Bank, societe
anonyme ("Cedel"). Beneficial interests in each of the Restricted Global Note
and the Regulation S Global Note are trading in DTC's Same-Day Funds Settlement
System, and secondary market trading activity in such interests will therefore
settle in immediately available funds. Beneficial interests in such Global Notes
are shown on, and transfers thereof are effected only through, records
maintained by DTC and its participants, including, in the case of the Regulation
S Global Note, Euroclear and Cedel. Unless certain conditions are satisfied,
certificated Initial Notes will not be issued in exchange for beneficial
interests in the Global Notes. See "Description of Notes."
In connection with the November 1996 Notes Placement, SEACOR and Credit
Suisse First Boston Corporation, Salomon Brothers Inc and Wasserstein Perella
Securities, Inc., as initial purchasers of the Initial Notes (collectively, the
"Initial Purchasers"), entered into a certain registration rights agreement (the
"November 1996 Registration Rights Agreement"; and together with Smit
Registration Rights Agreement, the "Registration Rights Agreements"). Pursuant
to the November 1996 Registration Rights Agreement, SEACOR has filed with the
Commission the Registration Statement to permit, from time to time, resales by
the holders of the Initial Notes and the shares of Common Stock issuable upon
conversion thereof. See "Selling Securityholders" and "Description of Notes."
NEW VESSEL CONSTRUCTION
The Company has committed to build vessels over the next two years for an
aggregate capital expenditure of approximately $108.0 million. Approximately
$20.5 million has been funded to date and approximately $9.4 million is
committed to be paid by Transportation Maritima Mexicana S.A. de C.V. ("TMM"),
pursuant to a
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Memorandum of Understanding dated September 25, 1996, between TMM and the
Company covering several vessels.
1996 COMMON STOCK OFFERING
On July 3, 1996, the Company sold in an underwritten offering 909,235
shares of its Common Stock at $43.50 per share (the "1996 Common Stock
Offering"). In conjunction therewith, 842,355 shares of Common Stock were sold
by certain of the Company's stockholders. The Company received net proceeds of
approximately $37.7 million from its sale of 909,235 shares of Common Stock, of
which $26.0 million was used to purchase four vessels acquired from Compagnie
Nationale de Navigation, a French corporation ("CNN"), pursuant to the 1996 CNN
Transaction (defined below), and to prepay $9.6 million of indebtedness then
owed by the Company to CNN. The remainder of such net proceeds has been
allocated by the Company for general corporate purposes.
1996 CNN TRANSACTION
On July 3, 1996, pursuant to an agreement entered into by the Company and
CNN in June 1996, the Company acquired from CNN six vessels for $22.65 million
in cash (the "1996 CNN Transaction"). At closing, the Company prepaid $9.6
million aggregate principal amount of the indebtedness outstanding under
promissory notes previously issued to CNN by a subsidiary of the Company. In
addition, CNN converted $4.75 million principal amount of the Company's 2.5%
Convertible Subordinated Notes Due January 1, 2004 (the "2.5% Notes") into
156,650 shares of Common Stock (in accordance with the terms of the 2.5% Notes),
and subsequently sold all 616,598 shares of Common Stock then owned by it
(including the shares of Common Stock received by CNN upon such conversion) in
the 1996 Common Stock Offering.
6.0% NOTE CONVERSION
On July 12, 1996, following notice from the Company of the redemption on
such date of all $55.25 million principal amount of its then outstanding 6.0%
Convertible Subordinated Notes Due July 1, 2003 (the "6.0% Notes"), the holders
thereof converted all of such 6.0% Notes into an aggregate of 2,156,083 shares
of Common Stock issued by the Company.
MCCALL ACQUISITION
On May 31, 1996, the Company acquired McCall Enterprises, Inc. and its
affiliated companies (collectively, the "McCall Companies") which, at the date
of such acquisition, operated 36 crew boats and five utility boats dedicated to
serving the oil and gas industry primarily in the U.S. Gulf of Mexico. Such
acquisition (the "McCall Acquisition"), which has been accounted for by the
Company as a pooling-of-interests, was accomplished pursuant to a series of
merger and share exchange agreements involving the Company and certain of its
subsidiaries, the McCall Companies and the former stockholders of the McCall
Companies. Pursuant to the McCall Acquisition, on August 9, 1996, the Company
issued an aggregate of 1,306,550 shares of Common Stock to the former
stockholders of the McCall Companies.
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For additional information relating to the recent developments described
above, see the Company's Current Reports on Form 8-K referred to above under
"Incorporation of Certain Information by Reference." For additional information
relating to the Company's business, operations, properties and other matters,
see the Company's Annual Report on Form 10-K for its fiscal year ended December
31, 1995 and its Quarterly Reports on Form 10-Q for its fiscal quarters ended
March 31, 1996, June 30, 1996 and September 30, 1996 referred to above under
"Incorporation of Certain Information by Reference."
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The following table provides a summary description of the Securities
offered hereby.
Notes
-----
Notes Offered by the
Selling Securityholders.... $187,750,000 aggregate principal amount of
5-3/8% Convertible Subordinated Notes Due
November 15, 2006 (the "Notes"). The Notes
consist of $15,250,000 principal amount of
the Smit Notes and $172,500,000 principal
amount of the Initial Notes.
Notes Offered by the
Company.................... None.
Maturity Date.............. November 15, 2006.
Interest .................. The Notes bear interest at a rate of 5-3/8%
per annum from November 5, 1996, in the case
of the Initial Notes, and from December 19,
1996, in the case of the Smit Notes, or, in
each case, from the most recent interest
payment date on which interest has been paid
or provided for, payable on May 15 and
November 15 of each year, commencing on May
15, 1997 to the holders thereof on the May 1
and November 1, respectively, preceding such
interest payment date.
Conversion Rights.......... The Notes are convertible, in whole or in
part, at the option of the holder at any time
prior to the close of business on the
business day immediately preceding the
maturity date, unless previously redeemed,
into shares of Common Stock at a conversion
price of $66 per share (equivalent to a
conversion rate of 15.1515 shares of $1,000
principal amount of the Notes), subject to
adjustment in certain circumstances and to
restrictions on foreign ownership of Common
Stock. Upon conversion, any accrued interest
will be deemed paid by the appropriate
portion of the Common Stock received by the
holder upon such conversion. See "Risk
Factors--Limitation on Foreign Ownership of
Common Stock" and "Description of
Notes--Conversion Rights."
Sinking Fund............... None.
9
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<PAGE>
Optional Redemption........ The Notes are redeemable, in whole or from
time to time in part, at the option of the
Company, at any time on or after November 24,
1999 at the redemption prices set forth
herein, plus accrued and unpaid interest to
the date of redemption. See "Description of
Notes--Optional Redemption."
Repurchase Rights of Holders Upon the
occurrence of a Change in Control (as defined
in the Indenture), holders of the Notes may
elect to require the Company to repurchase
their Notes, in whole or in part, at a
purchase price equal to 100% of the principal
amount thereof plus accrued interest through
the date of repurchase. See "Description of
Notes--Certain Rights to Require Purchase of
Securities."
Ranking.................... The Notes are general unsecured obligations
of the Company, subordinated in right of
payment to the prior payment in full of all
Senior Indebtedness (as defined in the
Indenture) and effectively subordinated in
right of payment to the prior payment in full
of all indebtedness and other obligations and
liabilities and any preferred stock of the
Company's subsidiaries. The Indenture does
not restrict the Company's ability to incur
Senior Indebtedness or the ability of the
Company's subsidiaries to incur additional
indebtedness or other obligations and
liabilities or to issue preferred stock. At
December 31, 1996, Senior Indebtedness and
additional indebtedness of the Company's
subsidiaries totalled approximately $32.7
million aggregate principal amount. See "Risk
Factors--Holding Company Structure;
Subordination" and "Description of
Notes--Subordination of Securities."
Under the Indenture, the Company may issue,
in one or more series of not less than $5.0
million aggregate principal amount per
series, up to an additional $12.25 million
aggregate principal amount of convertible
subordinated notes (in addition to the Notes
offered hereby). All convertible subordinated
notes issued under the Indenture will be
identical in all material respects to the
Notes offered hereby other than issuance
dates, initial interest accrual dates and
issuance prices.
10
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<PAGE>
Denomination and Registration
of Notes................... With respect to the Initial Notes, the 144A
Notes are represented by a global Note (the
"Restricted Global Note") in fully registered
form, without coupons, which was deposited
with a custodian for, and registered in the
name of, DTC in The City of New York. The Reg
S Notes are represented by a global Note in
fully registered form, without coupons (the
"Regulation S Global Note," and together with
the Restricted Global Note, the "Global
Notes"), which was deposited with a custodian
for and registered in the name of a nominee
of, DTC in The City of New York for the
accounts of Euroclear and Cedel. Beneficial
interests in the Global Notes will be shown
on, and transfers thereof will be effected
only through, records maintained by DTC and
its participants, including Euroclear and
Cedel. Unless certain conditions specified in
the Indenture are met, certificated Initial
Notes will not be issued in exchange for
beneficial interests in the Global Notes. See
"Description of Notes-Form, Denomination and
Registration."
The Smit Notes were issued in certificated
fully registered form in the name of Smit
International Overseas B.V. See "Description
of Notes-Form, Denomination and Regis-
tration."
Registration Rights........ The Company has agreed to file this
Registration Statement in respect of the
Notes and the Common Stock issuable upon the
conversion thereof pursuant to the
Registration Rights Agreements. Upon the
failure by the Company to comply with certain
of its obligations under such agreements,
additional interest with respect to the
Notes, and additional payments with respect
to 712,000 shares of Common Stock issued to
Smit Overseas, will be payable. See
"Description of Notes--Registration Rights."
Shares
------
Shares Offered by the
Selling Securityholders.... 2,844,694 shares of Common Stock, par value
$.01 per share, issuable upon conversion of
the Notes.
Shares Offered by the
Company.................... None.
Use of Proceeds............ The Company will not receive any proceeds
from the sale by the Selling Securityholders
of the Notes or the shares of Common Stock
issuable upon the conversion thereof. See
"Use of Proceeds."
11
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RISK FACTORS
PROSPECTIVE INVESTORS IN THE SECURITIES OFFERED HEREBY SHOULD CAREFULLY
CONSIDER THE FOLLOWING RISK FACTORS, IN ADDITION TO ALL OF THE OTHER INFORMATION
CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS.
INDUSTRY CONDITIONS
OFFSHORE MARINE SERVICES; MARKET VOLATILITY
The Company's offshore vessel operations are dependent on activity in the
offshore oil and gas exploration and production industry. The level of
exploration and development of offshore areas is affected by both short-term and
long-term trends in oil and gas prices which, in turn, are related to the demand
for petroleum products and the current availability of oil and gas resources.
The level of offshore activity also is related to local policies that influence
drilling activities. In recent years, oil and gas prices and, therefore, the
level of offshore exploration and drilling activity have been extremely
volatile. A significant or prolonged decline in future oil and gas prices would
likely result in reduced exploration and development of offshore areas and a
decline in the demand for offshore marine services. Such reduced activity could
have a material adverse effect on the Company's financial condition and results
of operations.
Charter rates for the Company's vessels also are dependent on the supply of
offshore marine vessels. Excess vessel capacity in the industry can result from
refurbishment of "mothballed" vessels, conversion of vessels formerly dedicated
to services other than oil support and related offshore marine activities and
construction of new vessels. The addition of new capacity to the worldwide
offshore marine fleet would increase competition in those markets where the
Company presently operates which, in turn, could have a material adverse effect
on the Company's financial condition and results of operations.
ENVIRONMENTAL SERVICES
The environmental response business is dependent upon the development,
interpretation and enforcement of regulations promulgated under OPA 90 and, to a
lesser extent, upon oil spill response regulations developed at the state level.
There currently is no uniformity of regulatory development or enforcement on a
federal or state level. The Company believes that it generally benefits from
increasingly stringent oil spill regulations and from increased enforcement of
such regulations (which, in each case, increases demand for NRC's services).
However, a relaxation of oil spill requirements or decreased enforcement of such
regulations could reduce demand for NRC's services and, therefore, have a
material adverse effect on the Company's financial condition and results of
operations.
NRC is a "classified" Oil Spill Removal Organization ("OSRO"). The United
States Coast Guard (the"Coast Guard") classifies OSROs based on their overall
resource capability to respond to various types and sizes of oil spills in
different operating environments such as rivers/canals, inland waters and oceans
(separated into nearshore, offshore and open ocean areas). In November 1993,
shortly after the initial OSRO program guidelines were published, NRC applied
for and received an "E" classification, the highest classification level
achievable. The Coast Guard reserves the right to review NRC's resource
capability at any time based on the Company's performance during actual response
and cleanup activities and exercises and may, under certain circumstances, amend
or revoke the classification. In September 1995, the Coast Guard proposed
revised draft OSRO guidelines and requested industry and regulatory comments. On
December 28, 1995, the revised OSRO guidelines were published. Significant
revisions include geographic-specific classifications, a requirement to ensure
the availability of non-dedicated resources in quantities twice what is required
of dedicated resources, proof of subcontractor support and more stringent
oversight by the Coast Guard. NRC's "E" classification under the
12
<PAGE>
<PAGE>
original program has expired. NRC has reapplied for new classification under the
revised guidelines and has received an interim classification as of December 24,
1996. The Coast Guard must verify the information in the application, and there
can be no assurance that NRC will receive a final classification or a final
classification equivalent to its current classification.
RELIANCE ON SIGNIFICANT CUSTOMERS
The Company offers offshore marine services primarily to the major
integrated oil companies and large independent oil and gas exploration and
production companies. The percentage of revenues attributable to an individual
customer varies from time to time, depending on the level of oil and gas
exploration undertaken by a particular customer, the suitability of the
Company's vessel for the customer's projects and other factors, many of which
are beyond the Company's control. For the nine months ended September 30, 1996,
approximately 14.1% of the Company's marine operating revenues were received
from Mobil Oil Corporation.
The Company offers its environmental and oil spill response services
primarily to the domestic and international shipping community, including dry
cargo vessel owners and owners of facilities such as refineries, pipelines,
exploration and production platforms and tank terminals. The Company presently
has approximately 325 customers and provides retainer coverage to approximately
1,750 self-propelled vessels, 1,000 barges and 250 facilities. The Company's
retainer arrangements with these customers include both short-term contracts
(one year or less) and long-term agreements, in some cases as long as seven
years. For the nine months ended September 30, 1996, Coastal and Sun Oil, NRC's
two largest customers, accounted for 35.8% of NRC's retainer revenues,
collectively.
GOVERNMENT REGULATION
Both the Company's offshore marine operations and environmental response
operations are materially affected by government regulation in the form of
international conventions, federal and state laws and regulations in
jurisdictions where the Company's vessels operate and/or are registered. These
regulations govern oil spills and other matters of environmental protection,
worker health and safety, and the manning, construction and operation of
vessels.
The Company believes that it is presently in material compliance with the
environmental laws and regulations to which the Company's operations are
subject. The Company is not a party to any pending proceeding and is unaware of
any threatened litigation or other judicial, administrative or arbitrable
environmental proceedings which, if adversely determined, would have a material
adverse effect on the financial condition or results of operations of the
Company. However, the risks of incurring substantial compliance costs and
liabilities and penalties for non-compliance are inherent in offshore marine
service operations. There can be no assurance that significant costs,
liabilities, and penalties will not be incurred by or imposed on the Company in
the future.
OFFSHORE MARINE SERVICES
OPA 90 requires owners and operators of tank vessels and certain other oil
handling facilities to obtain certificates of financial responsibility for
potential oil spill liability. The Company currently satisfies this requirement
with respect to Company vessels required to maintain such certificates.
13
<PAGE>
<PAGE>
ENVIRONMENTAL SERVICES
The Company's environmental services are conducted through NRC, an
indirect, wholly-owned subsidiary of the Company. OPA 90 regulations require
certain vessels to identify in their response plans the availability of response
resources or OSROs they will use in the event of an oil spill. NRC's primary
sources of revenue are retainer arrangements with customers for making available
its spill removal vessels and related marine equipment in the event of a spill.
Authority to implement these regulations is divided among several regulatory
agencies: the Coast Guard, the U.S. Environmental Protection Agency, the U.S.
Minerals Management Service and the Office of Pipeline Safety. Currently, there
is no uniformity of regulatory interpretation or enforcement by these agencies.
On the state level, enforcement of analogous regulations varies from state to
state. Due to this lack of uniformity, the amount of response resources required
to be made available to the Company's customers is unclear. In addition, because
regulatory enforcement initiatives affect the demand for NRC's retainer
coverage, state and federal regulatory policies may have a material impact on
NRC's results of operations.
In addition to establishing policies which impact the demand for and value
of NRC's services, the Coast Guard, pursuant to its program for classifying
OSROs, provides classified OSROs a market advantage over non-classified service
providers. A classified OSRO provides its clients a means of verifying that such
entity has the necessary response resources available. Revocation of such
"classification" or changes in the requirements could have a material adverse
effect on the Company's financial condition or results of operations.
In providing spill response services, NRC is subject to the federal
responder immunity doctrine, otherwise known as the "Good Samaritan" doctrine,
which holds the Company harmless from liability for any spills that result from
the Company's response efforts, unless the Company is found to be grossly
negligent or to have engaged in willful misconduct. While most of the U.S.
states in which NRC provides service have adopted the Good Samaritan doctrine,
several states have not. In the event that NRC is determined to have acted with
gross negligence or to have engaged in willful misconduct in providing spill
response services, NRC could be jointly and severally liable with the local
contractor and the responsible party for any resulting damages. Although NRC
maintains insurance coverage against such risks which it considers adequate,
there can be no assurance that such coverage adequately will cover future claims
that may arise.
OPERATING RISKS AND INSURANCE
The operation of offshore support vessels is subject to various risks,
including catastrophic marine disaster, adverse weather conditions, mechanical
failure, collision, oil and hazardous substance spills and errors of navigation
by vessel pilots, all of which represent a threat to the safety of personnel and
to the Company's vessels, cargo, equipment under tow and other property, as well
as the environment. The primary operating risks inherent in the environmental
response business are the failure to meet the planning guidelines of federal and
state statutes, or gross negligence in providing spill response services. The
occurrence of the foregoing events either in the offshore marine services or
environmental services business could result in revenue and casualty loss,
increased costs and significant liability by the Company to third parties. The
Company maintains insurance coverage against these risks which it considers
adequate and it has not in the past experienced a loss in excess of policy
limits. There can be no assurance, however, that the Company's existing
insurance coverage can be renewed at commercially reasonable rates or that such
coverage will be adequate to cover future claims that may arise.
RELIANCE ON FOREIGN OPERATIONS
For the nine months ended September 30, 1996, approximately 27.9% of the
Company's offshore marine revenues were derived from foreign operations. As a
result of the consummation of the Smit Transaction, the Company expects to
derive a substantially greater portion of its revenues from foreign operations
and, accordingly, anticipates that its foreign operations as a percentage of its
total offshore marine revenues will
14<PAGE>
<PAGE>
increase materially. The Company's foreign offshore marine operations are
subject to various risks inherent in conducting business in foreign nations.
These risks include, among others, political instability, potential vessel
seizure, nationalization of assets, currency restrictions and exchange rate
fluctuations, import-export quotas and other forms of public and governmental
regulation, all of which are beyond the control of the Company. Although,
historically, the Company's operations have not been affected materially by such
conditions or events, it is not possible to predict whether any such conditions
or events might develop in the future. The occurrence of any one or more of such
conditions or events could have a material adverse effect on the Company's
financial condition and results of operations.
The Company currently operates 32 vessels offshore West Africa, which
primarily service the local offshore oil and gas industry. The Company's
operations offshore West Africa are highly dependent on the level of activity in
Nigeria. At this time, Nigeria, because of its domestic policies, has become the
subject of certain international sanctions, including the suspension of
development aid by the European Union and the suspension of Nigeria from the
Commonwealth of Nations. Additional sanctions may be imposed in the future,
which could include economic sanctions, such as an oil embargo. Economic
sanctions or an oil embargo would have a significant negative impact on activity
in the oil and gas industry offshore West Africa, which in turn would have a
negative impact on the Company's operations in that area. There can be no
assurance that the effects of economic sanctions or an oil embargo with respect
to Nigeria would not have a material adverse effect on the Company's financial
condition and results of operations.
CURRENCY FLUCTUATIONS
Due to its foreign operations, the Company is exposed to currency
fluctuations and exchange rate risks. As a result of the consummation of the
Smit Transaction, the Company will have greater exposure to currency
fluctuations and exchange rate risks. To minimize the financial impact of these
risks, the Company attempts to contract the majority of its services in U.S.
dollars. However, in certain of the Company's foreign operations, the Company
collects revenues and pays expenses in local currency. For financial statement
reporting purposes, these accounts are translated into U.S. dollars at the
weighted average exchange rates during the relevant period.
Because the Company conducts substantially all of its operations in U.S.
dollars, to the extent the value of the U.S. dollar decreases in relation to the
value of applicable foreign currencies, such decrease potentially could
adversely affect the Company's operating revenues in foreign jurisdictions. To
date, currency fluctuations have not had a material impact on the Company's
financial condition or results of operations and the Company is not a party to
any currency hedging arrangements.
AGE OF FLEET
As of September 30, 1996, the average age of the Company's owned offshore
marine service fleet was approximately 14.5 years, whereas, at such date, the
average age of the Company's owned environmental service response fleet was 27.9
years. The consummation of the Smit Transaction and the Galaxie Transaction will
not materially alter the average age of the Company's fleet. NRC's vessels
primarily operate in a "stand-by" mode with minimal wear and, consequently,
management does not consider age to be a reliable indicator of the commercial
viability of the vessels. The Company believes that after an offshore supply
vessel has been in service for approximately 25 years, the amount of
expenditures (which typically increase with vessel age) necessary to satisfy
required marine certification standards may not be economically justifiable. If
the Company is unable to replace its vessels at the end of their useful economic
lives, the cost of new building could materially increase the Company's capital
expenditures. There can be no assurance that the Company will be able to
maintain its fleet by extending the economic life of existing vessels or
acquiring new or used vessels, or that the Company's financial resources will be
sufficient to enable it to make capital expenditures for such purposes.
15
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<PAGE>
COMPETITION
Both the Company's marine and environmental segments operate in highly
competitive industries. In addition to price, service and reputation, the
principal competitive factors for offshore supply fleets include the existence
of national flag preference, operating conditions and intended use (all of which
determine the suitability of vessel types), complexity of maintaining logistical
support and the cost of transferring equipment from one market to another.
The principal competitive factors in the environmental services business
are price, service, reputation, experience and operating capabilities. The
Company believes that the lack of uniformity of regulatory development and
enforcement on an international, federal and state level has created a lower
barrier of entry in several market segments which has increased the number of
competitors. NRC faces competition from the Marine Spill Response Corporation (a
non-profit corporation funded by the major integrated oil companies), other
industry cooperatives, and also from smaller contractors who target specific
market niches.
DIVIDENDS
SEACOR has not paid any cash dividends in respect of the Common Stock since
its inception in December 1989 and presently does not intend to pay any such
dividends in the foreseeable future. Instead, SEACOR intends to retain earnings
for working capital and to finance the expansion of its business operations. In
addition, as a holding company, the Company's ability to pay any cash dividends
is dependent on the earnings and cash flows of its operating subsidiaries and
their ability to make funds available to the Company. Pursuant to the terms of
the Company's bank credit facility with Den norske Bank A/S (the "DnB
Facility"), SEACOR, without the prior written consent of Den norske Bank A/S, is
prohibited through February 28, 1997 from paying cash dividends in respect of
the Common Stock.
HOLDING COMPANY STRUCTURE; SUBORDINATION
The Notes will be general unsecured obligations of the Company. The Notes
will not be guaranteed by the Company's subsidiaries and will not be secured by
any assets of such subsidiaries. Because the Company conducts its offshore
marine operations through its operating subsidiaries, the Company's ability to
service its debt obligations, including its ability to pay the principal of and
interest on the Notes, and its ability to pay dividends on the Common Stock
(including shares of Common Stock issuable upon conversion of the Notes), is
strictly dependent upon the earnings and cash flows of its subsidiaries and the
ability of these subsidiaries to make funds available to the Company for such
purpose (whether in the form of intercompany loans, dividends or otherwise).
The Notes will be subordinated in right of payment to all existing and
future Senior Indebtedness of the Company (generally, indebtedness for borrowed
money of the Company that, by its terms, is not expressly subordinated to, or
pari passu with, the Notes). The Indenture will not prohibit the Company from
creating, assuming or guaranteeing Senior Indebtedness. Moreover, under the
Indenture, the Company will not be permitted to pay principal of or interest on,
or otherwise acquire the Notes (including any repurchase at the election of the
holders of Notes upon the occurrence of a Change in Control) if a payment
default on Senior Indebtedness has occurred and is continuing, or in the event
of the insolvency, bankruptcy, reorganization, dissolution or other winding up
of the Company where Senior Indebtedness is not paid in full.
As a consequence of the Company's holding company structure, the Notes will
effectively rank junior in right of payment to the prior payment in full of all
obligations and liabilities and any preferred stock of the Company's
subsidiaries. Therefore, the claims of creditors of the Company's subsidiaries
will, in respect of the assets of such subsidiaries, have priority over claims
of the Company's creditors (including holders of the Notes), even though the
obligations to creditors of the Company's subsidiaries do not constitute Senior
Indebtedness. The
16
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Indenture will not restrict or limit the ability of the Company's subsidiaries
to incur, assume or guarantee any indebtedness or to issue any preferred stock.
Moreover, the Indenture will not restrict or limit the ability of the Company or
any of its subsidiaries from creating liens and security interests or otherwise
encumbering its properties and assets, or from making payments and distributions
on account of its equity securities.
At December 31, 1996, Senior Indebtedness and indebtedness of the Company's
subsidiaries were approximately $32.7 million aggregate principal amount.
DEBT RESTRICTIONS
SEACOR, as a holding company which conducts offshore marine operations
through its operating subsidiaries, is strictly dependent on the earnings and
cash flows of these subsidiaries to service the Company's debt obligations and
expenses and to pay dividends, if any, on its Common Stock. The terms of the
Company's indebtedness prohibit (with limited exceptions) the ability of certain
of the Company's borrowing subsidiaries to make funds available to the Company
for the payment of principal of and interest on the Notes and dividends on the
shares of Common Stock issuable upon conversion of the Notes.
Certain of the Company's subsidiaries are currently subject to financial
and operating covenants under the DnB Facility.
LIMITATION ON FOREIGN OWNERSHIP OF COMMON STOCK
The Company is subject to the Shipping Act, 1916, as amended (the "Shipping
Act"), and the Merchant Marine Act of 1920, as amended (the "1920 Act," and
together with the Shipping Act, the "Acts"), which govern, among other things,
the ownership and operation of vessels used to carry cargo between U.S. ports.
The Acts require that vessels engaged in the U.S. coastwise trade be (i) owned
by U.S. citizens and (ii) built in the United States. For a corporation engaged
in the U.S. coastwise trade to be deemed a citizen of the U.S., (a) the
corporation must be organized under the laws of the U.S. or of a state,
territory or possession thereof, (b) each of the president or other chief
executive officer and the chairman of the board of directors of such corporation
must be a U.S. citizen, (c) no more than a minority of the number of directors
of such corporation necessary to constitute a quorum for the transaction of
business can be non-U.S. citizens and (d) at least 75% of the interest in such
corporation must be owned by U.S. "Citizens" (as defined in the Acts). Should
the Company fail to comply with the U.S. citizenship requirements of the Acts,
it would be prohibited from operating its vessels in the U.S.
coastwise trade during the period of such non-compliance.
To facilitate compliance with the Acts, SEACOR's Restated Certificate of
Incorporation: (i) contains provisions limiting the aggregate percentage
ownership by foreigners of any class of the Company's capital stock (including
the Common Stock) to 22.5% of the outstanding shares of each such class to
ensure that such foreign ownership will not exceed the maximum percentage
permitted by applicable maritime law (presently 25.0%), and authorizes the Board
of Directors, under certain circumstances, to increase the foregoing percentage
to 24.0%, (ii) requires institution of a dual stock certification system to help
determine such ownership and (iii) permits the Board of Directors to make such
determinations as reasonably may be necessary to ascertain such ownership and
implement such limitations. In addition, the Company's Amended and Restated
By-laws provide that the number of foreign directors shall not exceed a minority
of the number necessary to constitute a quorum for the transaction of business
and restrict any officer who is not a U.S. citizen from acting in the absence or
disability of the Chairman of the Board of Directors, Chief Executive Officer or
the President, all of whom must be U.S. citizens. At February 11, 1997,
approximately 5.1% of the outstanding shares of Common Stock of the Company were
owned by foreigners (without giving effect to the conversion of the Notes
offered hereby).
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ABSENCE OF MARKET; ILLIQUIDITY OF NOTES
There is currently no market for the Notes offered hereby and the Company
does not intend to seek to establish a market for trading in the Notes. Although
the Initial Purchasers in the November 1996 Notes Placement informed the Company
that they intended to make a market in the Initial Notes, they are not obligated
to do so, and any such market making may be discontinued at any time without
notice. In addition, such market making will be subject to the limits imposed by
the Securities Act and the Exchange Act. Accordingly, there can be no assurance
as to the development or liquidity of any market for the Initial Notes or, if
one does develop, that it will be maintained. The Company does not intend to
apply for listing of the Notes on any national securities exchange.
USE OF PROCEEDS
The Securities are being offered hereby solely for the accounts of the
Selling Securityholders pursuant to the Registration Rights Agreements. The
Company will not receive any proceeds from the sale of the Securities.
See "Selling Securityholders."
DIVIDEND POLICY
SEACOR has not paid any cash dividends in respect of the Common Stock since
its inception in December 1989, and has no present intention to pay any such
dividends in the foreseeable future. Instead, SEACOR intends to retain earnings
for working capital and to finance the expansion of its business operations.
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SELECTED HISTORICAL FINANCIAL INFORMATION
The following table sets forth selected consolidated income statement
and balance sheet information for each of the five years in the period ended
December 31, 1995, which information has been derived from consolidated
financial statements of the Company, which, in the case of the three-year period
ended December 31, 1995, have been audited by Arthur Andersen LLP, independent
auditors, and are included elsewhere in this Prospectus. The selected
consolidated income statement and balance sheet data for the nine months ended
September 30, 1995 and 1996 are derived from the Company's unaudited financial
statements. Interim results, in the opinion of management, include all
adjustments (consisting solely of normal recurring adjustments) necessary to
present fairly the financial information for such periods; however, such results
are not necessarily indicative of the results which may be expected for any
other interim period or for a full year. The following data should be read in
conjunction with the Consolidated Financial Statements and the notes thereto
included elsewhere in this Prospectus.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
------------------------------------------------------- ----------------
1991 1992 1993 1994 1995 1995 1996
------ ------ ------ ------ ------ ------ -----
(in thousands, except share data)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Operating Revenue:
Marine...................... $65,878 $74,317 $92,168 $93,985 $104,894 $65,957 $138,043
Environmental-
Oil spill response........ - - - - 8,927 8,367 8,547
Retainer and other services - - - - 12,838 7,721 13,703
------- --------- ------ --------- ------- ------- ---------
65,878 74,317 92,168 93,985 126,659 82,045 160,293
------- --------- ------ --------- ------- ------- ---------
Costs and Expenses:
Cost of oil spill
response.................. - - - - 7,643 7,117 7,655
Operating expenses-
Marine.................... 38,520 46,775 53,958 55,860 66,205 42,819 77,137
Environmental............. - - - - 4,580 2,874 4,511
Administrative and general.. 4,500 5,211 7,187 7,278 13,953 8,249 16,876
Depreciation and amortization 9,965 12,804 12,107 14,108 18,842 12,773 17,791
------- --------- ------ --------- ------- ------- ---------
Operating income.............. 12,893 9,527 18,916 16,739 15,436 8,213 36,323
Interest Expense............ 6,678 7,044 4,782 5,422 6,681 4,149 4,007
Interest (Income)........... (449) (316) (1,063) (1,874) (2,370) (1,788) (1,731)
Gain/(loss) from equipment
sales or retirements...... - - (8) (388) 3,850 1,814 1,448
Other income (expense)...... (410) (1,197) 122 (267) 667 248 (498)
------- ------ ------ --------- --------- ------- ----------
Income Before Income Taxes,
Minority Interest, Equity
in Net Earnings of 50% or
Less Owned Companies and
Extraordinary Item.......... 6,254 1,602 15,311 12,536 15,642 7,914 34,997
Income Tax Expense............ 2,200 652 5,339 4,368 5,510 2,852 12,445
------- --------- --------- ----- --------- ------- ---------
19
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<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
------------------------------------------------------- ----------------
1991 1992 1993 1994 1995 1995 1996
------ ------ ------ ------ ------ ------ -----
(in thousands, except share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Income Before Minority Interest,
Equity in Net Earnings of 50%
or Less Owned Companies and
Extraordinary Item............ 4,054 950 9,972 8,168 10,132 5,062 22,552
Minority Interest in (Income)
Loss of a Subsidiary.......... - 41 (51) 184 321 250 176
Equity in Net Earnings of 50%
or Less Owned Companies....... - - 287 975 872 746 766
--------- --------- --------- --------- --------- --------- ---------
Income Before
Extraordinary Item............ 4,054 991 10,208 9,327 11,325 6,058 23,494
Extraordinary Item-Loss on
Extinguishment of Debt, Net
(less applicable income taxes) - - (1,093) - - - 807
--------- --------- --------- --------- --------- --------- ---------
Net Income...................... $ 4,054 $ 991 $ 9,115 $ 9,327 $ 11,325 $ 6,058 $ 22,687
========= ========= ========= ========= ========= ========= =========
Net Income
Per Common Share
Assuming no dilution(1)....... $ 0.83 $ 0.19 $ 1.28 $ 1.31 $ 1.50 $ 0.82 $ 2.08
Assuming full dilution........ 0.83 0.19 1.22 1.22 1.36 0.80 1.87
STATEMENT OF CASH FLOWS DATA:
Cash provided by operating
activities.................. $ 17,646 $ 15,311 $ 23,416 $ 21,150 $ 9,939 $ 5,378 $ 40,455
Cash provided by (used in)
investing activities.......... (40,605) 6,048 (24,251) (4,855) (78,695) (69,449) (33,873)
Cash provided by (used in)
financing activities.......... 22,323 852 17,657 (7,714) 53,291 53,210 (6,898)
OTHER FINANCIAL DATA:
EBITDA(2)....................... $ 23,229 $ 24,570 $ 32,366 $ 32,923 $ 35,964 $22,386 $ 55,493
Ratio of earnings to
fixed charges................. 1.86 1.21 3.93 3.17 3.18 2.76 9.28
BALANCE SHEET DATA (AT PERIOD END):
Cash and temporary
investments................... $ 9,567 $ 19,564 $ 36,008 $ 44,637 $ 28,786 $ 33,727 $ 28,484
Total assets.................... 187,594 181,765 233,511 238,145 350,883 330,448 378,571
Total debt...................... 75,179 50,653 87,959 79,517 110,555 147,303 8,231
Stockholders' equity............ 70,080 89,639 100,532 111,482 183,464 123,677 302,330
- ---------------------
<FN>
(1) This computation is submitted in accordance with Regulation S-K, Item
601(b)(11). For the periods noted, it is contrary to APB Opinion No. 15 as
per footnote to paragraph 14 thereto which does not require the inclusion
of common stock equivalents in the earnings per share calculation if the
dilutive effect is less than 3%.
(2) As used herein, "EBITDA" is operating income plus depreciation and
amortization, amortization of deferred mobilization costs, which is
included in marine operating expenses, minority interest in (income) loss
of subsidiary and equity in net earnings of 50% or less owned companies.
EBITDA should not be considered by an investor as an alternative to net
income as an indicator of the Company's operating performance or as an
alternative to cash flows as a better measure of liquidity.
</FN>
</TABLE>
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DESCRIPTION OF NOTES
The Notes were issued under the Indenture, a copy of which has been filed by
the Company with the Commission. The Indenture is subject to and is governed by
the Trust Indenture Act of 1939, as amended. The following summary of certain
provisions of the Indenture does not purport to be complete and is subject to,
and is qualified in its entirety by reference to, all the provisions of the
Indenture, copies of which will be available for inspection at the Corporate
Trust Office of the Trustee in St. Paul, Minnesota. Whenever particular Sections
or defined terms of the Indenture are referred to, such Sections or defined
terms are incorporated in their entirety herein by reference.
The Indenture provides for (i) the issuance of up to $187.75 million
aggregate principal amount of Notes being offered hereby and (ii) the issuance
of additional series of convertible subordinated notes in aggregate principal
amounts of not less than $5.0 million per series and not to exceed $12.25
million principal amount in the aggregate. All Notes will be identical in all
material respects other than issuance dates, initial interest accrual dates and
issuance prices.
GENERAL
The Notes are unsecured, subordinated general obligations of the Company,
are limited to an aggregate principal amount of $200.0 million and will mature
on November 15, 2006. The Notes bear interest at a rate of 5-3/8% per annum from
November 5, 1996, in the case of the Initial Notes, and from December 19, 1996,
in the case of the Smit Notes, or from the most recent Interest Payment Date on
which interest has been paid or provided for. Interest is payable semi-annually
on May 15 and November 15 of each year, commencing on May 15, 1997, to the
Person in whose name the Note (or any predecessor Note) is registered (a
"Holder") at the close of business on the preceding May 1 or November 1 (whether
or not a Business Day), as the case may be.
Interest on the Notes will be computed on the basis of a 360-day year
comprised of twelve, 30-day months.
FORM, DENOMINATION AND REGISTRATION
The Smit Notes were issued in definitive form and registered in the name of
Smit International Overseas B.V.
Approximately $22.35 million principal amount of the Initial Notes were sold
in offshore transactions in reliance on Regulation S and represented by the
Regulation S Global Note in definitive, fully registered form, without coupons,
and were registered in the name of a nominee of DTC and deposited with the
Trustee as custodian for DTC.
Approximately $146.88 million principal amount of the Initial Notes were
sold in reliance on Rule 144A and represented by the Restricted Global Note in
definitive, fully registered form, without coupons, and were deposited with the
Trustee as custodian for DTC and registered in the name of a nominee of DTC.
Approximately $3.27 million principal amount of the Initial Notes were
originally issued to institutional "accredited investors" (as defined in Rule
501 (a)(1), (2), (3) or (7) under the Securities Act). Upon the transfer of an
Initial Note in definitive form, such Initial Note will, unless the Global Note
has previously been exchanged for Initial Notes in definitive form, be exchanged
for an interest in the Global Note representing the principal amount of the
Initial Notes being transferred.
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All Notes were issued only in fully registered form, without exception, in
denominations of $1,000 and integral multiples thereof. No service charge will
be made for any registration of transfer or exchange of Notes, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Company appointed the Trustee as registrar, paying agent and transfer
agent of the Notes. In such capacities, the Trustee is responsible for, among
other things, (i) maintaining a record of the aggregate holdings of Notes
represented by the Regulation S Global Note and the Restricted Global Note and
accepting Notes for exchange and registration of transfer, (ii) ensuring that
payments of principal and interest in respect of the Notes received by the
Trustee from the Company are duly paid to the depositaries or their respective
nominees and (iii) transmitting to the Company any notices from Holders.
GLOBAL NOTES
Upon the issuance of the Regulation S Global Note and the Restricted Global
Note, DTC credited, on its internal system, the respective principal amount of
the individual beneficial interests represented by such Global Notes to the
accounts of persons who have accounts with such depositary. Such accounts
initially were designated by or on behalf of the Initial Purchasers. Ownership
of beneficial interests in a Global Note was limited to persons who maintain
accounts with DTC ("participants") or persons who hold interests through
participants. Ownership of beneficial interests in the Global Notes is shown on,
and the transfer of that ownership will be effected only through, records
maintained by DTC or its nominee (with respect to interests of participants) and
the records of participants (with respect to interests of persons other than
participants).
So long as DTC, or its nominee, is the registered holder of a Global Note,
DTC or such nominee, as the case may be, will be considered the sole owner and
holder of the Initial Notes represented by such Global Note for all purposes
under the Indenture and the Initial Notes. Unless DTC notifies the Company that
it is unwilling or unable to continue as depositary for a Global Note, or ceases
to be a "Clearing Agency" registered under the Exchange Act, or an Event of
Default has occurred and is continuing with respect to such Initial Note, or
unless a request for certificates is made upon 60 days' prior written notice as
described below under "-Certificated Notes," owners of beneficial interests in a
Global Note will not be entitled to have any portions of such Global Note
registered in their names, will not receive or be entitled to receive physical
delivery of the Initial Notes in certificated form and will not be considered
the owners or holders of the Global Note (or any Initial Notes represented
thereby) under the Indenture or the Initial Notes. In addition, no beneficial
owner of an interest in a Global Note will be able to transfer that interest
except in accordance with DTC's applicable procedures (in addition to those
under the Indenture referred to herein and, if applicable, those of Euroclear
and Cedel).
Investors are able to hold their interests in the Regulation S Global Note
through any organizations (including Cedel and Euroclear) that are participants
in the DTC system. Cedel and Euroclear hold interests in the Regulation S Global
Note on behalf of their participants through customers' securities accounts in
their respective names on the books of their respective depositaries, which, in
turn, hold such interests in the Regulation S Global Note in customers'
securities accounts in the depositaries' names on the books of DTC. Investors
may hold their interests in the Restricted Global Note directly through DTC, if
they are participants in such system, or indirectly through organizations which
are participants in such system.
Payments of the principal of and interest on Global Notes will be made to
DTC or its nominee as the registered owner thereof. Neither the Company, the
Trustee nor any Paying Agent will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests in the Global Notes or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
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DTC or its nominee, upon receipt of any payment of principal or interest in
respect of a Global Note representing any Notes held by it or its nominee, will
immediately credit participants' accounts with payments in amounts proportionate
to their respective beneficial interests in the principal amount of such Global
Note for such Notes as shown on the records of DTC or its nominee. Payments by
participants to owners of beneficial interests in such Global Note held through
such participants will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers
registered in "street name." Such payments will be the responsibility of such
participants.
Transfers between participants in DTC will be effected in accordance with
DTC's procedures therefor, and will be settled in same-day funds. The laws of
some U.S. states require that certain persons take physical delivery of
securities in definitive form. Consequently, the ability to transfer beneficial
interests in a Global Notes to such persons may be limited. Because DTC can only
act on behalf of participants who, in turn, act on behalf of indirect
participants and certain banks, the ability of a person having a beneficial
interest in Global Notes to pledge such interest to persons or entities that do
not participate in the DTC system, or otherwise take actions in respect of such
interest, may be affected by the lack of a physical certificate evidencing such
interest. Transfers between participants in Euroclear and Cedel will be effected
in the ordinary course in accordance with their respective rules and operating
procedures.
Cross-market transfers between DTC, on the one hand, and directly or
indirectly through Euroclear or Cedel participants, on the other hand, will be
effected in DTC in accordance with DTC's rules on behalf of Euroclear or Cedel,
as the case may be, by its respective depositary; however, such cross-market
transactions will require the delivery of instructions to Euroclear or Cedel, as
the case may be, by the counterparty in such system in accordance with its rules
and procedures and within its established deadlines (Brussels time). Euroclear
or Cedel, as the case may be, will, if the transaction meets its settlement
requirements, deliver instructions to its respective depositary to take action
to effect final settlement on its behalf by delivering or receiving interests in
the Regulation S Global Note in DTC, and making or receiving payment in
accordance with normal procedures for same-day funds settlement applicable to
DTC. Cedel participants and Euroclear participants may not deliver instructions
directly to the depositaries for Cedel or Euroclear.
Because of time zone differences, the securities account of a Euroclear or
Cedel participant purchasing an interest in a Global Note from a DTC participant
will be credited during the securities settlement processing day (which must be
a business day for Euroclear and Cedel) immediately following the DTC settlement
date and such credit of any transactions in interests in a Global Note settled
during such processing day will be reported to the relevant Euroclear or Cedel
participant on such day. Cash received in Euroclear or Cedel as a result of
sales of interests in a Global Note by or through a Euroclear or Cedel
participant to a DTC participant will be received with value on the DTC
settlement date but will be available in the relevant Euroclear or Cedel cash
account only as of the business day following settlement in DTC.
DTC has advised the Company that it will take any action permitted to be
taken by a holder of Initial Notes (including the presentation of Initial Notes
for exchange as described below) only at the direction of one or more
participants to whose account with DTC interests in the Global Notes are
credited and only in respect of such portion of the aggregate principal amount
of the Initial Notes as to which such participant or participants has or have
given such direction. However, if there is an Event of Default (as defined
below) under the Initial Notes, DTC will exchange the Global Notes for legended
certificated Initial Notes in definitive form, which it will distribute to its
participants.
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DTC has advised the Company as follows: DTC is a limited purpose trust
company organized under the laws of the State of New York, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the
Uniform Commercial Code, as amended, and a "Clearing Agency" registered pursuant
to the provisions of Section 17A of the Exchange Act. DTC was created to hold
securities for its participants and facilitate the clearance and settlement of
securities transactions between participants through electronic book-entry
changes in accounts of its participants, thereby eliminating the need for
physical transfer and delivery of certificates. Participants include securities
brokers and dealers, banks, trust companies and clearing corporations and may
include certain other organizations. Indirect access to the DTC system is
available to other entities such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a participant,
either directly or indirectly ("indirect participants").
Although DTC, Cedel and Euroclear have agreed to the foregoing procedures to
facilitate transfers of interests in the Regulation S Global Note and in the
Restricted Global Note among their respective participants, they are under no
obligation to perform or continue to perform such procedures, and such
procedures may be discontinued at any time. Neither the Company nor the Trustee
will have any responsibility for the performance by DTC, Cedel or Euroclear or
their respective participants or indirect participants of their respective
obligations under the rules and procedures governing their operations.
Both the Initial Notes sold to institutional "accredited investors" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) and the
Smit Notes are represented by definitive certificates and constitute
approximately $18.52 principal amount of the Notes. Book-entry transfer of such
Notes effected on DTC is not available, and the transfer of such Notes requires
physical transfer and delivery of certificates.
CERTIFICATED NOTES
If any depositary is at any time unwilling or unable to continue as a
depositary for the reasons set forth under "-Global Notes", the Company will
issue certificates for the Initial Notes in definitive registered form in
exchange for the Regulation S Global Note and Restricted Global Note, as the
case may be. In addition, upon request, the Company will issue certificates for
the Initial Notes in definitive, fully registered form, without interest
coupons, in exchange for beneficial interests of like principal amount in any
Global Note, but only upon at least 60 days' prior written notice given to the
Trustee in accordance with DTC's customary procedures. Upon receipt of such
notice from the Trustee, the Company will cause the requested certificates to be
prepared for delivery. In all cases, certificates for the Initial Notes
delivered in exchange for any Global Note or beneficial interests therein will
be registered in the names, and issued in any approved denominations, requested
by DTC.
The Initial Notes sold to institutional "accredited investors" (as defined
in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) and the Smit Notes
are represented by definitive certificates, in fully registered form, without
coupons.
PAYMENTS AND PAYING AGENTS
Payments of principal of and interest on the Notes will be made at the
corporate trust office of the Trustee in St. Paul, Minnesota or, at the option
of the Holder and subject to any fiscal or other laws and regulations applicable
thereto, at the office of the Trustee or any Paying Agent outside St. Paul,
Minnesota. Payment in respect of principal on the Notes will be made only
against surrender of such Notes. Payment in respect of interest on each Interest
Payment Date with respect to any such Note will be made to the person in whose
name such Note is registered on May 1 or November 1 immediately preceding such
Interest Payment Date by Dollar check drawn on a bank in Minneapolis, Minnesota
or, for Holders of at least $5,000,000 of Notes, by wire transfer to an account
maintained by the payee with a bank in the United States or in Europe, provided
that a written request
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from such Holder to such effect is received by the Trustee or any Paying Agent
no later than the April 15 or October 15 immediately preceding such Interest
Payment Date. Unless such designation is revoked, any such designation made by
such person with respect to such Note will remain in effect with respect to any
future payments with respect to such Note payable to such person. The Company
will pay any administrative costs imposed by banks in connection with remaining
payments by wire transfer.
If the due date for payment of any amount in respect of principal or
interest on any Note is not a business day at the place in which it is presented
for payment, the Holder thereof shall not be entitled to payment of the amount
due until the next succeeding business day at such place and shall not be
entitled to any further interest or other payment in respect of any such delay.
As used in the Indenture regarding payment, "business day" means a day in which
banks are open for business and carrying out transactions in Dollars in the
relevant place of payment.
Subject to certain limitations set forth in the Indenture, the Company
reserves the right at any time to vary or terminate the appointment of the
Trustee or any Paying Agent with or without cause and to appoint another Trustee
or additional or other Paying Agents and to approve any change in the specified
offices through which any Paying Agent acts.
CONVERSION RIGHTS
The Notes will be convertible, in whole or in part, into Common Stock of the
Company at the option of the Holder at any time after 60 days following the date
of original issuance thereof and prior to the close of business on the Business
Day immediately preceding the maturity date, unless previously redeemed,
initially at the conversion price of $66 per share (equivalent to a conversion
rate of 15.1515 shares of $1,000 principal amount of Notes), subject to
adjustment in certain circumstances. The right to convert the Notes called for
redemption will terminate at the close of business on the Business Day
immediately preceding the Redemption Date unless the Company defaults in making
the payment due on the Redemption Date. For information as to notices of
redemption, See "-Optional Redemption."
If the Company, by means of dividend or otherwise, declares or makes a
distribution in respect of its Common Stock referred to in clause (iv) or (v)
below, the Holder of each Note, upon the conversion thereof subsequent to the
close of business on the date fixed for the determination of stockholders
entitled to receive such distribution and prior to the effectiveness of the
conversion price adjustment in respect of such distribution pursuant to clause
(iv) or (v) below, will be entitled to receive for each share of Common Stock
into which such Note is converted, the portion of the evidences of indebtedness,
shares of capital stock, cash and other property so distributed applicable to
one share of Common Stock; provided, however, that the Company may, with respect
to all Holders so converting, in lieu of distributing any portion of such
distribution not consisting of cash or securities of the Company, pay such
Holder cash equal to the fair market value thereof. (Section 13.01)
The conversion price will he subject to adjustment upon the occurrence of
certain events, including: (i) the payment of dividends (and other
distributions) of Common Stock on any class of capital stock of the Company;
(ii) the issuance to all holders of Common Stock of rights, warrants or options
entitling them to subscribe for or purchase Common Stock at less than the
current market price (as defined) thereof; (iii) subdivisions and combinations
of Common Stock; (iv) distributions to all holders of Common Stock of evidences
of indebtedness of the Company, shares of capital stock, securities, cash or
property (excluding any rights, warrants or options referred to in clause (ii)
above and any dividend or distribution paid exclusively in cash and any dividend
or distribution referred to in clause (i) above); (v) distributions consisting
exclusively of cash to all holders of Common Stock in an aggregate amount that,
together with (A) other all-cash distributions made within the
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preceding 12 months and (B) any cash and the fair market value, as of the
expiration of the tender or exchange offer referred to below, of consideration
payable in respect of any tender or exchange offer by the Company or a
Subsidiary for the Common Stock concluded within the preceding 12 months,
exceeds 12.5% of the Company's aggregate market capitalization (such aggregate
market capitalization being the product of the current market price (as defined)
of the Common Stock multiplied by the number of shares of Common Stock then
outstanding) on the date of such distribution; and (vi) the successful
completion of a tender or exchange offer made by the Company or any Subsidiary
for the Common Stock which involves an aggregate consideration that, together
with (X) any cash and the fair market value of other consideration payable in
respect of any tender or exchange offer by the Company or a Subsidiary for the
Common Stock concluded within the preceding 12 months and (Y) the aggregate
amount of any all-cash distributions to all holders of the Company's Common
Stock made within the preceding 12 months, exceeds 12.5% of the Company's
aggregate market capitalization on the expiration of such tender or exchange
offer. No adjustment of the conversion price will be required to be made until
cumulative adjustments amount to 1% or more of the conversion price as last
adjusted. (Section 13.04)
In the case of certain reclassifications, consolidations, mergers, sales or
transfers of assets or other transactions pursuant to which the Common Stock is
converted into the right to receive other securities, cash or other property,
each Note then outstanding would, without the consent of any Holders of Notes,
become convertible only into the kind and amount of securities, cash and other
property receivable upon the transaction by a holder of the number of shares of
Common Stock which would have been received by a Holder immediately prior to
such transaction if such Holder had converted its Note. (Section 13.11)
Fractional shares of Common Stock will not be issued upon conversion, but,
in lieu thereof, the Company will pay a cash adjustment based upon market price
of the Common Stock. (Section 13.03)
Except as described in this paragraph, no Holder of Notes will be entitled,
upon conversion thereof, to any actual payment or adjustment on account of
accrued and unpaid interest (although such accrued and unpaid interest will be
deemed paid by the appropriate portion of the Common Stock received by the
holders upon such conversion) or on account of dividends on shares of Common
Stock issued in connection therewith. Notes surrendered for conversion during
the period from the close of business on any Regular Record Date to the opening
of business on the corresponding Interest Payment Date (except Notes called for
redemption on a Redemption Date within such period between and including such
Regular Record Date and such Interest Payment Date) must be accompanied by
payment to the Company of an amount equal to the interest payable on such
Interest Payment Date on the principal amount converted.
If at any time the Company makes a distribution of property to its
stockholders which would be taxable to such stockholders as a dividend for
federal income tax purposes (e.g., distributions of evidences of indebtedness or
assets of the Company, but generally not stock dividends or rights to subscribe
to capital stock) and, pursuant to the conversion price adjustment provisions of
the Indenture, the conversion price of the Notes is reduced, such reduction may
be deemed to be the receipt of taxable income to Holders of Notes.
In addition, the Company may make such reductions in the conversion price as
the Board of Directors of the Company deems advisable to avoid or diminish any
income tax to holders of shares of Common Stock resulting from any dividend or
distribution of stock (or rights to acquire stock) or from any event treated as
such for income tax purposes or for any other reasons.
THE SHARES OF COMMON STOCK ISSUABLE UPON THE CONVERSION OF THE NOTES ARE
SUBJECT TO CERTAIN LIMITATIONS ON FOREIGN OWNERSHIP AND AS A CONDITION TO THE
RECEIPT OF COMMON STOCK UPON THE CONVERSION OF THE NOTES, HOLDERS OF THE NOTES
WILL BE REQUIRED TO FURNISH A CERTIFICATION AS TO, AND UNDER CERTAIN
CIRCUMSTANCES, ADDITIONAL PROOF OF, THEIR CITIZENSHIP. BY REASON OF SUCH
RESTRICTIONS, A FOREIGN HOLDER OF
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NOTES MAY RECEIVE A LESSER NUMBER OF SHARES OF COMMON STOCK UPON THE CONVERSION
OF THE NOTES THAN IT OTHERWISE MAY BE ENTITLED TO RECEIVE PURSUANT TO THE TERMS
OF THE NOTES AND THE INDENTURE. SEE "LIMITATION ON FOREIGN OWNERSHIP OF
SECURITIES."
OPTIONAL REDEMPTION
The Notes may be redeemed at the option of the Company, in whole or from
time to time in part, on at least 30 and not more than 60 days' notice by mail
to the registered Holders thereof, at any time on or after November 24, 1999, at
the following Redemption Prices (expressed as percentages of principal amount),
if redeemed during the twelve-month period beginning on November 24 of the years
set forth below:
Year Percentage Year Percentage
- ---- ---------- ---- ----------
1999.......................103.58% 2002.................... 101.79%
2000.......................102.99% 2003.................... 101.19%
2001.......................102.39% 2004.................... 100.60%
; and thereafter at 100% of the principal amount thereof; in each case together
with accrued and unpaid interest to (but not including) the Redemption Date
(subject to the rights of Holders of record on any Regular Record Date to
receive interest due on any Interest Payment Date that is on or prior to such
Redemption Date). If less than all the Notes are to be redeemed, the Trustee
will select or cause to be selected the Notes by such method as it deems fair
and appropriate and which may provide for selection for redemption of portions
of the principal amount of any Note of a denomination larger than $1,000.
(Section 2.03 and Article XI)
No sinking fund is provided for the Notes.
CERTAIN RIGHTS TO REQUIRE PURCHASE OF NOTES
In the event a Change in Control occurs, each Holder of Notes will have the
right, at the Holder's option, to require the Company to purchase all or any
part of such Holder's Notes on the date (the "Repurchase Date") that is 75 days
after the date the Company gives notice of the Change in Control, at a price
(the "Repurchase Price") equal to 100% of the principal amount thereof, together
with accrued and unpaid interest through the Repurchase Date. On or prior to the
Repurchase Date, the Company shall deposit with a Paying Agent an amount of
money sufficient to pay the aggregate Repurchase Price of the Notes which is to
be paid on the Repurchase Date.
The Company may not purchase any Note pursuant to the preceding paragraph
at any time when the subordination provisions of the Indenture otherwise would
prohibit the Company from making payments of principal in respect of the Notes.
Failure by the Company to repurchase the Notes when required under the preceding
paragraph will constitute an Event of Default under the Indenture whether or not
such repurchase is permitted by the subordination provisions of the Indenture.
On or before the 15th day after the Company knows or reasonably should know
a Change in Control has occurred, the Company will be required to mail to all
Holders of record of the Notes a notice of the occurrence of such Change in
Control, the date by which the repurchase right must be exercised, the
Repurchase Price for the Notes and the procedures which the Holder must follow
to exercise such right. To exercise the repurchase right, the Holder of a Note
will be required to deliver, on or before the 10th day prior to the Repurchase
Date, written notice to the Company (or an agent designated by the Company for
such purpose) of the Holder's exercise of such
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right, together with the certificates evidencing the Note or Notes with respect
to which the right is being exercised, duly endorsed for transfer.
The term "Beneficial Owner" shall be determined in accordance with Rules
13d-3 and 13d-5 promulgated by the United States Securities and Exchange
Commission (the "Commission") under the Exchange Act or any successor provision
thereto, except that a Person shall be deemed to have "beneficial ownership" of
all shares that such Person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time.
A "Change in Control" shall be deemed to have occurred at such time as (a)
any Person, or any Persons acting together in a manner which would constitute a
"group" (a "Group") for purposes of Section 13(d) of the Exchange Act, or any
successor provision thereto, together with any Affiliates thereof, (i) become
the Beneficial Owners, directly or indirectly, of capital stock of the Company,
entitling such Person or Persons and its or their Affiliates to exercise more
than 50% of the total voting power of all classes of the Company's capital stock
entitled to vote generally in the election of the Company's directors or (ii)
shall succeed in having sufficient of its or their nominees (who are not
supported by a majority of the then current Board of Directors of the Company)
elected to the Board of Directors of the Company such that such nominees, when
added to any existing directors remaining on the Board of Directors of the
Company after such election who are Affiliates of or acting in concert with such
Persons, shall constitute a majority of the Board of Directors of the Company,
(b) the Company shall be a party to any transaction pursuant to which the Common
Stock is converted into the right to receive other securities (other than Common
Stock), cash and/or property (or the Company, by dividend, tender or exchange
offer or otherwise, distributes other securities, cash and/or property to
holders of Common Stock) and the value of all such securities, cash and/or
property distributed in such transaction and any other transaction effected
within the 12 months preceding consummation of such transaction (as determined
in good faith by the Board of Directors, whose determination shall be conclusive
and described in a Board Resolution) is more than 50% of the average of the
daily Closing Prices for the five consecutive Trading Days ending on the Trading
Day immediately preceding the date of such transaction (or, if earlier, the
Trading Day immediately preceding the "ex" date (as defined in paragraph (7) of
Section 1304 of the Indenture) for such transaction) or (c) the Company shall
consolidate with or merge into any other Person or sell, convey, transfer or
lease its properties and assets substantially as an entirety to any Person other
than a Subsidiary, or any other Person shall consolidate with or merge into the
Company (other than, in the case of this clause (c), pursuant to any
consolidation or merger where Persons who are stockholders of the Company
immediately prior thereto become the Beneficial Owners of shares of capital
stock of the surviving company entitling such Persons to exercise more than 50%
of the total voting power of all classes of such surviving company's capital
stock entitled to vote generally in the election of directors).
The effect of these provisions granting the Holders the right to require
the Company to purchase the Notes upon the occurrence of a Change in Control may
make it more difficult for any person or group to acquire control of the Company
or to effect a business combination with the Company. Moreover, under the
Indenture, the Company will not be permitted to pay principal of or interest on,
or otherwise acquire the Notes (including any repurchase at the election of the
Holders of Notes upon the occurrence of a Change in Control) if a payment
default on Senior Indebtedness has occurred and is continuing, or in the event
of the insolvency, bankruptcy, reorganization, dissolution or other winding up
of the Company where Senior Indebtedness is not paid in full. The Company's
ability to pay cash to Holders of Notes following the occurrence of a Change in
Control may be limited by the Company's then existing financial resources. There
can be no assurance that sufficient funds will be available when necessary to
make any required repurchases.
28
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<PAGE>
In the event a Change in Control occurs and the Holders exercise their
rights to require the Company to repurchase Notes, the Company intends to comply
with applicable tender offer rules under the Exchange Act, including Rules 13e-4
(other than SEC filing requirements if not then applicable) and 14e-1, as then
in effect, with respect to any such purchase.
REGISTRATION RIGHTS
The Company has agreed pursuant to the November 1996 Registration Rights
Agreement and the Smit Registration Rights Agreement, for the benefit of the
Holders of the Notes and the Common Stock issuable upon the conversion thereof,
that the Company would, at its cost, (a) as promptly as practicable file the
Registration Statement on Form S-3 covering resales of the Notes and the Common
Stock issuable upon the conversion thereof pursuant to Rule 415 under the
Securities Act, (b) use its best efforts to cause the Registration Statement to
be declared effective under the Securities Act, and (c) in the case of the
November 1996 Registration Rights Agreement, keep the Registration Statement
effective after its effective date for as long as shall be required under Rule
144(k) under the Securities Act or any successor rule or regulation thereto,
subject to extension of such period in certain circumstances, and, in the case
of the Smit Registration Rights Agreement, keep the Registration Statement
effective after its effective date until the third anniversary of the date on
which such Registration Statement was first declared effective by the
Commission. The Company will provide to each Holder for whom the Registration
Statement is filed copies of the Prospectus which is a part of the Registration
Statement, notify each such Holder when the Registration Statement has become
effective, and take certain other actions as are required to permit unrestricted
resales of the Shares, Notes and the Common Stock issuable upon the conversion
thereof, by such Holders to third parties, other than through underwritten
offerings. A Holder selling such securities pursuant to the Registration
Statement generally is required to be named as a Selling Securityholder in this
Prospectus and to deliver this Prospectus to purchasers, subject to certain of
the civil liability provisions under the Securities Act in connection with such
sales and bound by the provisions of the registration rights agreements
applicable to such holder (including certain indemnification obligations).
In the case of the November 1996 Registration Rights Agreement, if after
the Registration Statement has been declared effective, such Registration
Statement ceases to be effective or usable (subject to certain exceptions) in
connection with resales of the Initial Notes and the Common Stock issuable upon
the conversion thereof in accordance with and during the periods specified in
the November 1996 Registration Rights Agreement (an "Initial Registration
Default"), the Initial Notes will bear interest at the rate per annum of 5-7/8%,
from and including the date on which any such registration default shall occur
to but excluding the date on which all Initial Registration Defaults have been
cured. The Company will have no liability for monetary damages with respect to
its registration obligations; provided, however, that in the event the Company
breaches, fails to comply or violates certain provisions of the November 1996
Registration Rights Agreement, the Holders shall be entitled to, and the Company
shall not oppose the granting of, equitable relief, including injunction and
specific performance. At all other times, interest will accrue on the Initial
Notes at a rate of 5-3/8% per annum.
In the case of the Smit Registration Rights Agreement, if after the
Registration Statement has been declared effective, the Registration Statement
thereafter ceases to be effective or usable (subject to certain exceptions) in
connection with resales of the Smit Notes and the Common Stock issuable upon
conversion thereof in accordance with and during the periods specified in the
Smit Registration Rights Agreement (a "Smit Registration Default"), (A) the Smit
Notes will accrue additional interest of 1.00% over and above 5-3/8% from and
including the date on which any Smit Registration Default has occurred but
excluding the date on which all such registration defaults have been cured and
(B) additional payments with respect to the 712,000 Shares will be owed by the
Company equal to the product of (i) 1.00%, multiplied by (ii) the number of
Shares held by such Holder, multiplied by (iii) $49.16, multiplied by (iv) a
fraction, the numerator of which is the number of days during such default
period and
29
<PAGE>
<PAGE>
the denominator of which is 360, and in both clauses (A) and (B), the period of
default will be from and including the date on which any such Smit Registration
Default shall occur to but excluding the date on which all Smit Registration
Defaults have been cured. The Company will have no liability for monetary
damages with respect to its registration obligations, provided, however, that in
the event that the Company breaches, fails to comply or violates certain
provisions of the Smit Registration Rights Agreement, the Selling
Securityholders thereunder shall be entitled to, and the Company shall not
oppose the granting of, equitable relief, including injunction and specific
performance. At all other times, interest will accrue on the Smit Notes at a
rate of 5-3/8% per annum.
The summary herein of certain provisions of the November 1996 Registration
Rights Agreement and the Smit Registration Rights Agreement does not purport to
be complete and is subject to, and is qualified in its entirety by reference to,
all the provisions of such registration rights agreements, copies of which are
available upon request to the Company.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indenture provides that the Company, without the consent of the Holders
of any of the Outstanding Securities, may consolidate with or merge into any
other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person or may permit any Person to
consolidate with or merge into, or transfer or lease its properties
substantially as an entirety to, the Company; provided, that (a) the successor,
transferee or lessee is organized under the laws of any United States
jurisdiction; (b) the successor, transferee or lessee, if other than the
Company, expressly assumes the Company's obligations under the Indenture and the
Notes by means of a supplemental indenture entered into with the Trustee; (c)
after giving effect to the transaction, no Event of Default and no event which,
with notice or lapse of time, or both, would constitute an Event of Default,
shall have occurred and be continuing; and (d) certain other conditions are met.
(Section 8.01)
Under any consolidation by the Company with, or merger by the Company into,
any other Person or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety as described in the preceding
paragraph, the successor resulting from such consolidation or into which the
Company is merged or the transferee or lessee to which such conveyance, transfer
or lease is made, will succeed to, and be substituted for, and may exercise
every right and power of, the Company under the Indenture, and thereafter,
except in the case of a lease, the predecessor (if still in existence) will be
released from its obligations and covenants under the Indenture and the Notes.
(Section 8.02)
EVENTS OF DEFAULT
An Event of Default is defined in the Indenture to be a (i) default in the
payment of any interest upon any of the Notes for 30 days or more after such
payment is due, whether or not such payment is prohibited by the subordination
provisions of the Indenture; (ii) default in the payment of the principal of and
premium, if any, on any of the Notes when due, whether or not such payment is
prohibited by the subordination provisions of the Indenture; (iii) default by
the Company in the performance, or breach, of any of its other covenants in the
Indenture which will not have been remedied by the end of a period of 60 days
after written notice to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in principal amount of the Outstanding
Securities; (iv) failure to pay when due the principal of, or acceleration of,
any indebtedness for money borrowed by the Company or a Subsidiary in excess of
$1.5 million principal amount, if such indebtedness is not discharged, or such
acceleration is not annulled, by the end of a period of 10 days after written
notice to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in principal amount of the Outstanding Securities; and
(v) certain events of bankruptcy, insolvency or reorganization of the Company or
a Significant Subsidiary. (Section 5.01)
30
<PAGE>
<PAGE>
The Indenture provides that if an Event of Default (other than of a type
referred to in clause (v) of the preceding paragraph) shall have occurred and is
continuing, either the Trustee or the Holders of at least 25% in principal
amount of the Outstanding Securities may declare the principal amount of all
Notes to be immediately due and payable. Such declaration may be rescinded if
certain conditions are satisfied. If an Event of Default of the type referred to
in clause (v) of the preceding paragraph shall have occurred, the principal
amount of the Outstanding Securities shall automatically become immediately due
and payable. (Section 5.02)
The Indenture also provides that the Holders of not less than a majority in
principal amount of the Outstanding Securities may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee; provided that such
direction is not in conflict with any rule of law or with the Indenture. The
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction. (Section 5.12)
The Indenture contains provisions entitling the Trustee, subject to the
duty of the Trustee during the continuance of an Event of Default to act with
the required standard of care, to be indemnified by the Holders of Notes before
proceeding to exercise any right or power under the Indenture at the request of
the Holders of Notes.
(Section 6.03)
No Holder of any Note has any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such Holder shall
have previously given to the Trustee written notice of a continuing Event of
Default and unless also the Holders of at least 25% in aggregate principal
amount of the Outstanding Securities shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as the
Trustee, and the Trustee shall not have received from the Holders of a majority
in aggregate principal amount of the Outstanding Securities a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days. (Section 5.07) However, such limitations do not apply
to a suit instituted by a Holder of a Note for enforcement of payment of the
principal of and premium, if any, or interest on such Note on or after the
respective due dates expressed in such Note or of the right to convert such Note
in accordance with the Indenture. (Section 5.08)
The Indenture requires the Company to file annually with the Trustee a
certificate, executed by a designated officer of the Company, stating to the
best of his knowledge that the Company is not in default under certain covenants
under the Indenture or if he has knowledge that the Company is in such default,
specifying such default. (Section 10.04)
MODIFICATION AND WAIVER
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the Holders of not less than a majority in principal amount
of the Outstanding Securities, to enter into one or more supplemental indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or modifying in any manner the rights of the Holders
of the Notes, except that no such modification or amendment may, without the
consent of the Holders of each of the Outstanding Securities affected thereby,
among other things, (i) change the Stated Maturity of the principal of or any
installment of interest on any Note; (ii) reduce the principal amount thereof or
any premium thereon or the rate of interest thereon; (iii) adversely affect the
right of any Holder to convert any Note as provided in the Indenture; (iv)
change the place of payment where, or the coin or currency in which, the
principal of any Note or any premium or interest thereon is payable; (v) impair
the right to institute suit for the enforcement of any such payment on or with
respect to any Note on or after the Stated Maturity (or, in the case of
redemption, on or after the Redemption Date); (vi) modify the subordination
provisions of the Indenture in a manner adverse to the Holders; (vii) modify the
redemption provisions of the Indenture in a manner adverse to the Holders;
(viii) modify the provisions of the Indenture
31
<PAGE>
<PAGE>
relating to the Company's requirement to offer to repurchase Notes upon a Change
in Control in a manner adverse to the Holders; (ix) reduce the percentage in
principal amount of the Outstanding Securities the consent of whose Holders is
required for any such modification or amendment of the Indenture or for any
waiver of compliance with certain provisions of, or of certain defaults under,
the Indenture; or (x) modify the foregoing requirements.
(Section 9.02)
The Holders of a majority in principal amount of the Outstanding Securities
may on behalf of the Holders of all Notes waive compliance by the Company with
certain restrictive provisions of the Indenture. (Section 10.08) The Holders of
a majority in principal amount of the Outstanding Securities may on behalf of
the Holders of all Notes waive any past default under the Indenture and its
consequences, except a default in the payment of the principal of or any premium
or interest on any Note or in respect of a provision which under the Indenture
cannot be modified or amended without the consent of the Holder of each
Outstanding Security affected. (Section 5.13)
SUBORDINATION OF NOTES
The payment of the principal of and premium, if any, and interest on the
Notes is, to the extent set forth in the Indenture, subordinated in right of
payment to the prior payment in full of all Senior Indebtedness. When there is a
payment or distribution of assets to creditors upon any liquidation,
dissolution, winding up, reorganization, assignment for the benefit of
creditors, marshalling of assets or any bankruptcy, insolvency or similar
proceedings of the Company, the holders of all Senior Indebtedness will first be
entitled to receive payment in full of all amounts due or to become due thereon,
or provision for such payment in money or money's worth, before the Holders of
the Notes will be entitled to receive any payment in respect of the principal of
or premium, if any, or interest on the Notes. No payments on account of
principal of, premium, if any, or interest on the Notes or on account of the
purchase or acquisition of Notes may be made if there has occurred and is
continuing a default in any payment with respect to Senior Indebtedness or if
any judicial proceeding is pending with respect to any such default.
By reason of such subordination, in the event of insolvency, creditors of
the Company who are not holders of Senior Indebtedness or of the Notes may
recover less, ratably, than holders of Senior Indebtedness and may recover more,
ratably, than the Holders of the Notes.
"Senior Indebtedness" is defined in the Indenture as the principal of and
premium, if any, and interest on all indebtedness of the Company for money
borrowed, other than the Notes, whether outstanding on the date of execution of
the Indenture or thereafter created, incurred, guaranteed or assumed, except
such indebtedness that by the terms of the instrument or instruments by which
such indebtedness was created or incurred expressly provides that it (i) is
junior in right of payment to the Notes or any other indebtedness of the Company
or (ii) ranks pari passu in right of payment to the Notes. The term
"indebtedness for money borrowed" when used with respect to the Company is
defined to mean (i) any obligation of, or any obligation guaranteed by, the
Company for the repayment of borrowed money, whether or not evidenced by bonds,
debentures, notes or other written instruments, (ii) all obligations of the
Company with respect to interest rate hedging arrangements to hedge interest
rates relating to Senior Indebtedness of the Company, (iii) any deferred payment
obligation of, or any such obligation guaranteed by, the Company for the payment
of the purchase price of property or assets evidenced by a note or similar
instrument and (iv) any obligation of, or any such obligation guaranteed by, the
Company for the payment of rent or other amounts under a lease of property or
assets which obligation is required to be classified and accounted for as a
capitalized lease on the balance sheet of the Company under generally accepted
accounting principles.
32
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<PAGE>
At December 31, 1996, Senior Indebtedness and additional indebtedness of
the Company's subsidiaries were approximately $32.7 million aggregate principal
amount. The Company and its subsidiaries expect from time to time to incur
additional indebtedness. The Indenture does not limit or prohibit the incurrence
of additional Senior Indebtedness, additional indebtedness or the issuance of
preferred stock by the Company's subsidiaries. As described therein, the
obligations of the Company under the Notes are effectively subordinated to any
obligations, liabilities and preferred stock of the Company's subsidiaries. See
"Risk Factors-Holding Company Structure; Subordination."
DEFEASANCE
The Indenture provides that (A) if applicable, the Company will be
discharged from any and all obligations in respect of the Outstanding Securities
(except for certain obligations to register the transfer or exchange of Notes,
to replace stolen, lost or mutilated Notes, to provide for conversion of the
Notes, to maintain paying agents and hold moneys for payment in trust, and to
repurchase Notes in the event of a Change in Control) or (B) if applicable, the
Company may omit to comply with certain restrictive covenants, but not including
the obligation to provide for conversion of the Notes or repurchase Notes in the
event of a Change in Control, and that such omission will not be deemed to be an
Event of Default under the Indenture and the Notes, in either case (A) or (B)
upon irrevocable deposit with the Trustee, in trust, of money and/or U.S.
Government Obligations that will provide money in an amount sufficient in the
opinion of a nationally recognized firm of independent public accountants
expressed in written opinions thereof to pay the principal of, premium, if any,
and each installment of, interest on the Outstanding Securities. With respect to
clause (B), the obligations under the Indenture other than with respect to such
covenants and the Events of Default other than the Event of Default relating to
such covenants above will remain in full force and effect. Such trust may only
be established if, among other things (i) with respect to clause (A), the
Company has delivered to the Trustee an Opinion of Counsel to the effect that
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling or there has been a change in law, which in the opinion
of counsel to the Company provides that Holders of the Notes will not recognize
gain or loss for Federal income tax purposes as a result of such deposit,
defeasance and discharge and will be subject to Federal income tax on the same
amount, in the same manner and at the same times as would have been the case if
such deposit, defeasance and discharge had not occurred; or, with respect to
clause (B), the Company has delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of the Notes will not recognize gain or loss for
Federal income tax purposes as a result of such deposit and defeasance and will
be subject to Federal income tax on the same amount, in the same manner and at
the same times as would have been the case if such deposit and defeasance had
not occurred; (ii) no Event of Default (or event that with the passing of time
or the giving of notice, or both, would constitute an Event of Default) shall
have occurred or be continuing; (iii) the Company has delivered to the Trustee
an Opinion of Counsel to the effect that such deposit shall not cause the
Trustee or the trust so created to be subject to the Investment Company Act of
1940, as amended; and (iv) certain other customary conditions precedent are
satisfied. (Article XV)
REGARDING THE TRUSTEE
First Trust National Association is the Trustee under the Indenture.
GOVERNING LAW
The Indenture and the Notes are governed by and will be construed in
accordance with the laws of the State of New York. (Section 1.12)
33
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<PAGE>
SELLING SECURITYHOLDERS
Each of the Securityholders listed below is a party to the Smit
Registration Rights Agreement, an Initial Purchaser or a transferee of an
Initial Purchaser party to the November 1996 Registration Rights Agreement, who
has agreed to be bound by the terms applicable to the transferor thereunder.
Pursuant to the Registration Rights Agreements, SEACOR has filed the
Registration Statement of which this Prospectus forms a part and has also agreed
to bear certain expenses related thereto and to indemnify each Selling
Securityholder against certain liabilities, including liabilities arising under
the federal securities laws. For a description of the Smit Transaction and the
November 1996 Notes Placement, see "Recent Developments" and "Description of
Notes."
SEACOR has filed with the Commission the Registration Statement of which
this Prospectus forms a part with respect to the sale by the Selling
Securityholders of the Securities from time to time on the NYSE (or through the
facilities of any national securities exchange or U.S. automated inter-dealer
quotation system of a registered national securities association, on which the
Securities are then listed, admitted to unlisted trading privileges or included
for quotation) or in privately negotiated transactions or otherwise, as more
fully described below under "Plan of Distribution." The Company has agreed to
use its best efforts to keep the Registration Statement current and effective
(subject to the Company's right to require Selling Securityholders to suspend
their use of this Prospectus under certain circumstances), until (in the case of
the Smit Registration Rights Agreement) the third anniversary of the date on
which the Registration Statement was first declared effective by the Commission
or such shorter period in which all of the securities registered pursuant to the
Smit Registration Rights Agreement have been sold or until (in the case of the
November 1996 Registration Rights Agreement) the Initial Notes and the shares of
Common Stock issuable upon conversion thereof have been sold or may be sold
pursuant to Rule 144(k) under the Securities Act (or any successor rule
thereof). For additional information relating to the November 1996 Registration
Rights Agreement and the Smit Registration Rights Agreement, see "Description of
Notes - Registration Rights."
The table below sets forth information with respect to the Selling
Securityholders and the respective principal amounts of the Notes and shares of
Common Stock beneficially owned by each Selling Securityholder. Such information
has been obtained from the Selling Securityholders or such other sources as the
Company deems reliable. To the Company's knowledge and except as otherwise
disclosed herein, none of the Selling Securityholders has, or within the past
three years has had, any position, office or other material relationship with
the Company or any of its predecessors or affiliates. Although the Selling
Securityholders may offer all or some portion of the Securities pursuant to this
Prospectus, the table below assumes that all of the Securities will be offered
and sold by the Selling Securityholders. In addition, the Selling
Securityholders identified below may have sold, transferred or otherwise
disposed of all or a portion of their Notes, since the date on which they
provided the Company with information regarding their Notes, in transactions
exempt from the registration requirements of the Securities Act. The Securities
are being registered to permit public secondary trading of the Securities, and
the Selling Securityholders may offer the Securities for sale from time to time.
See "Plan of Distribution."
34
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<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
ALLSTATE INSURANCE 30,303 $2,000,000 * 1.1% 30,303 $2,000,000
COMPANY
3075 SANDERS ROAD,
SUITE G5A
INVESTMENT LAW
DIVISION
NORTHBROOK, IL
60062-7127
ALPINE ASSOCIATES 15,151 $1,000,000 * * 15,151 $1,000,000
C/O V.E.Z. SYSTEMS
120 BROADWAY,
SUITE 913
NEW YORK, NY 10271
AMERICAN REPUBLIC 3,787 $250,000 * * 3,787 $250,000
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
ARGENT CLASSIC 15,151 $1,000,000 * * 15,151 $1,000,000
CONVERTIBLE
ARBITRAGE FUND
(BERMUDA) L.P.
C/O ARGENT FINANCIAL
GROUP (BERMUDA) LTD.
P.O. BOX HM 1154
HAMILTON HMEX
BERMUDA
ARGENT CLASSIC 15,151 $ 1,000,000 * * 15,151 $1,000,000
CONVERTIBLE ARBITRAGE
FUND L.P.
591 WEST PUTNAM AVENUE
GREENWICH, CT 06830
ASSOCIATED ELECTRIC 4,545 $300,000 * * 4,545 $300,000
& GAS INSURANCE
SERVICES LTD.
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
AUSTIN FIRE FIGHTERS 2,348 $155,000 * * 2,348 $155,000
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
BALANCED FUND 18,939 $1,250,000 * * 18,939 $1,250,000
C/O AIM CAPITAL
MANAGEMENT INC.
11 GREENWAY PLAZA
SUITE 1919
HOUSTON, TX 77046-1173
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
ALLSTATE INSURANCE - - - -
COMPANY
3075 SANDERS ROAD,
SUITE G5A
INVESTMENT LAW
DIVISION
NORTHBROOK, IL
60062-7127
ALPINE ASSOCIATES - - - -
C/O V.E.Z. SYSTEMS
120 BROADWAY,
SUITE 913
NEW YORK, NY 10271
AMERICAN REPUBLIC - - - -
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
ARGENT CLASSIC - - - -
CONVERTIBLE
ARBITRAGE FUND
(BERMUDA) L.P.
C/O ARGENT FINANCIAL
GROUP (BERMUDA) LTD.
P.O. BOX HM 1154
HAMILTON HMEX
BERMUDA
ARGENT CLASSIC - - - -
CONVERTIBLE ARBITRAGE
FUND L.P.
591 WEST PUTNAM AVENUE
GREENWICH, CT 06830
ASSOCIATED ELECTRIC - - - -
& GAS INSURANCE
SERVICES LTD.
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
AUSTIN FIRE FIGHTERS - - - -
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
BALANCED FUND - - - -
C/O AIM CAPITAL
MANAGEMENT INC.
11 GREENWAY PLAZA
SUITE 1919
HOUSTON, TX 77046-1173
35
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
BANK OF AMERICA
CONVERTIBLE 3,030 $200,000 * * 3,030 $200,000
SECURITIES FUND
C/O BANK OF AMERICA
PERSONAL TRUST
PROXY UNIT #38432
555 S. FLOWER STREET,
LEVEL C
LOS ANGELES, CA 90071
BANK OF TOKYO- 6,439 $425,000 * * 6,439 $425,000
MITSUBISHI
TRUST COMPANY
100 BROADWAY
NEW YORK, NY 10005
BT SERVICES 30,303 $2,000,000 * 1.1% 30,303 $2,000,000
TENNESSEE INC.
PENSION TRUST SERVICES
648 GRASSMERE PARK ROAD
NASHVILLE, TN 37211
BAPTIST HOSPITAL 1,969 $130,000 * * 1,969 $130,000
OF MIAMI
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
BCS LIFE INSURANCE 1,136 $75,000 * * 1,136 $75,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
BOSTON MUSEUM OF 833 $55,000 * * 833 $55,000
FINE ARTS
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
BZW SECURITIES 314,454 $20,754,000 2.2% 11.1% 314,454 $20,754,000
LIMITED
EBBGATE HOUSE
2 SWAN HOUSE
LONDON EC4R3TS
UNITED KINGDOM
CENTURY NATIONAL 12,121 $800,000 * * 12,121 $800,000
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
CHAMPION INTERNATIONAL 10,909 $720,000 * * 10,909 $720,000
CORP. MASTER RETIREMENT
TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
CHARTER FUND 125,000 $8,250,000 * 4.4% 125,000 $8,250,000
C/O AIM CAPITAL
MANAGEMENT INC.
11 GREENWAY PLAZA
SUITE 1919
HOUSTON, TX 77046-1173
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
BANK OF AMERICA
CONVERTIBLE - - - -
SECURITIES FUND
C/O BANK OF AMERICA
PERSONAL TRUST
PROXY UNIT #38432
555 S. FLOWER STREET,
LEVEL C
LOS ANGELES, CA 90071
BANK OF TOKYO- - - - -
MITSUBISHI
TRUST COMPANY
100 BROADWAY
NEW YORK, NY 10005
BT SERVICES - - - -
TENNESSEE INC.
PENSION TRUST SERVICES
648 GRASSMERE PARK ROAD
NASHVILLE, TN 37211
BAPTIST HOSPITAL - - - -
OF MIAMI
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
BCS LIFE INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
BOSTON MUSEUM OF - - - -
FINE ARTS
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
BZW SECURITIES - - - -
LIMITED
EBBGATE HOUSE
2 SWAN HOUSE
LONDON EC4R3TS
UNITED KINGDOM
CENTURY NATIONAL - - - -
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
CHAMPION INTERNATIONAL - - - -
CORP. MASTER RETIREMENT
TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
CHARTER FUND - - - -
C/O AIM CAPITAL
MANAGEMENT INC.
11 GREENWAY PLAZA
SUITE 1919
HOUSTON, TX 77046-1173
36
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
CHASE MANHATTAN/ 34,469 $2,275,000 * 1.2% 34,469 $2,275,000
CHEMICAL BANK
4 NEW YORK PLAZA,
11TH FLOOR
CORPORATE ACTION
DEPARTMENT
NEW YORK, NY 10004
CHASE MANHATTAN BANK 15,151 $1,000,000 * * 15,151 $1,000,000
4 NEW YORK PLAZA
NEW YORK, NY 10004
CHRYSLER INSURANCE 18,181 $1,200,000 * * 18,181 $1,200,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
CHRYSLER RETIREMENT 30,303 $2,000,000 * 1.1% 30,303 $2,000,000
PLAN
C/O PALISADE CAPITAL
MANAGEMENT, LLC
ONE BRIDGE PLAZA
FORT LEE, NJ 07024
CONCORD LIFE INSURANCE 606 $40,000 * * 606 $40,000
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
CREDIT SUISSE 145,454 $9,600,000 1.0% 5.1% 145,454 $9,600,000
FIRST BOSTON
CORPORATION (THE)
5 WORLD TRADE CENTER
NEW YORK, NY 10048-0928
CSA FRATERNAL LIFE 606 $40,000 * * 606 $40,000
C/O HARRIS BANK
111 WEST MONROE
P.O. BOX 755
CHICAGO, IL 60690
DAVID LIPSCOMB UNIV. 984 $65,000 * * 984 $65,000
GENERAL ENDOWMENT
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
DELTA AIR LINES MASTER 22,954 $1,515,000 * * 22,954 $1,515,000
TRUST
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
DELTA AIRLINES, INC. 25,757 $1,700,000 * * 25,757 $1,700,000
MASTER TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE
ROAD
NAPERVILLE, IL 60563
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
CHASE MANHATTAN/ - - - -
CHEMICAL BANK
4 NEW YORK PLAZA,
11TH FLOOR
CORPORATE ACTION
DEPARTMENT
NEW YORK, NY 10004
CHASE MANHATTAN BANK - - - -
4 NEW YORK PLAZA
NEW YORK, NY 10004
CHRYSLER INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
CHRYSLER RETIREMENT - - - -
PLAN
C/O PALISADE CAPITAL
MANAGEMENT, LLC
ONE BRIDGE PLAZA
FORT LEE, NJ 07024
CONCORD LIFE INSURANCE - - - -
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
CREDIT SUISSE - - - -
FIRST BOSTON
CORPORATION (THE)
5 WORLD TRADE CENTER
NEW YORK, NY 10048-0928
CSA FRATERNAL LIFE - - - -
C/O HARRIS BANK
111 WEST MONROE
P.O. BOX 755
CHICAGO, IL 60690
DAVID LIPSCOMB UNIV. - - - -
GENERAL ENDOWMENT
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
DELTA AIR LINES MASTER - - - -
TRUST
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
DELTA AIRLINES, INC. - - - -
MASTER TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE
ROAD
NAPERVILLE, IL 60563
37
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
THE DOW CHEMICAL
COMPANY 15,151 $1,000,000 * * 15,151 $1,000,000
EMPLOYEES RETIREMENT
PLAN TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
EMPLOYEES BENEFIT 1,515 $100,000 * * 1,515 $100,000
CONVERTIBLE FUND
C/O BANK OF AMERICA
PERSONAL TRUST
PROXY UNIT #38432
555 S. FLOWER STREET,
LEVEL C
LOS ANGELES, CA 90071
ENGINEERS JOINT 3,181 $210,000 * * 3,181 $210,000
PENSION FUND
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
EQUITABLE LIFE 29,242 $1,930,000 * 1.0% 29,242 $1,930,000
INSURANCE-SEPARATE
ACCOUNT
CONVERTIBLES
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
EQUITABLE LIFE 1,969 $130,000 * * 1,969 $130,000
ASSURANCE-SEPARATE
ACCOUNT BALANCED
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
FIRST NATIONAL BANK 909 $60,000 * * 909 $60,000
OF CHICAGO
ONE FIRST NATIONAL
PLAZA
SUITE 0417
CHICAGO, IL 60670
THE FONDREN FOUNDATION 1,136 $75,000 * * 1,136 $75,000
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
GE PENSION TRUST 15,151 $1,000,000 * * 15,151 $1,000,000
C/O PALISADE CAPITAL
MANAGEMENT, LLC
ONE BRIDGE PLAZA
FORT LEE, NJ 07024
GRAIN DEALERS MUTUAL 606 $40,000 * * 606 $40,000
LIFE INSURANCE
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
THE DOW CHEMICAL
COMPANY - - - -
EMPLOYEES RETIREMENT
PLAN TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
EMPLOYEES BENEFIT - - - -
CONVERTIBLE FUND
C/O BANK OF AMERICA
PERSONAL TRUST
PROXY UNIT #38432
555 S. FLOWER STREET,
LEVEL C
LOS ANGELES, CA 90071
ENGINEERS JOINT - - - -
PENSION FUND
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
EQUITABLE LIFE - - - -
INSURANCE-SEPARATE
ACCOUNT
CONVERTIBLES
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
EQUITABLE LIFE - - - -
ASSURANCE-SEPARATE
ACCOUNT BALANCED
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
FIRST NATIONAL BANK - - - -
OF CHICAGO
ONE FIRST NATIONAL
PLAZA
SUITE 0417
CHICAGO, IL 60670
THE FONDREN FOUNDATION - - - -
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
GE PENSION TRUST - - - -
C/O PALISADE CAPITAL
MANAGEMENT, LLC
ONE BRIDGE PLAZA
FORT LEE, NJ 07024
GRAIN DEALERS MUTUAL - - - -
LIFE INSURANCE
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
38
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
HARVARD MANAGEMENT 30,303 $2,000,000 * 1.1% 30,303 $2,000,000
COMPANY, INC.
600 ATLANTIC AVENUE
BOSTON, MA 02210-2203
THE HCA FOUNDATION 2,954 $195,000 * * 2,954 $195,000
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HERMES CAPITAL 7,575 $500,000 * * 7,575 $500,000
MANAGEMENT, LTD.
237 PARK AVENUE
9TH FLOOR
NEW YORK, NY 10017
HOSPITAL CORP. OF 8,636 $570,000 * * 8,636 $570,000
AMERICA MONEY
PURCHASE PLAN
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
THE HOTEL UNION 1,287 $85,000 * * 1,287 $85,000
PENSION TRUST-ILWU
PENSION TRUST
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
THE HOTEL UNION 3,787 $250,000 * * 3,787 $250,000
& INDUSTRY OF HAWAII
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HUDSON RIVER TRUST 7,348 $485,000 * * 7,348 $485,000
GROWTH AND INCOME
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HUDSON RIVER TRUST 11,439 $755,000 * * 11,439 $755,000
BALANCED ACCOUNT
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HUDSON RIVER TRUST 9,166 $605,000 * * 9,166 $605,000
GROWTH INVESTORS
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
HARVARD MANAGEMENT - - - -
COMPANY, INC.
600 ATLANTIC AVENUE
BOSTON, MA 02210-2203
THE HCA FOUNDATION - - - -
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HERMES CAPITAL - - - -
MANAGEMENT, LTD.
237 PARK AVENUE
9TH FLOOR
NEW YORK, NY 10017
HOSPITAL CORP. OF - - - -
AMERICA MONEY
PURCHASE PLAN
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
THE HOTEL UNION - - - -
PENSION TRUST-ILWU
PENSION TRUST
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
THE HOTEL UNION - - - -
& INDUSTRY OF HAWAII
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HUDSON RIVER TRUST - - - -
GROWTH AND INCOME
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HUDSON RIVER TRUST - - - -
BALANCED ACCOUNT
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
HUDSON RIVER TRUST - - - -
GROWTH INVESTORS
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
39
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
HUGHES AIRCRAFT COMPANY 11,136 $735,000 * * 11,136 $735,000
MASTER RETIREMENT TRUST
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
IBM RETIREMENT PLAN 45,454 $3,000,000 * 1.6% 45,454 $3,000,000
C/O PALISADE CAPITAL
MANAGEMENT, LLC
ONE BRIDGE PLAZA
FORT LEE, NJ 07024
INGELSA LTD. 7,575 $500,000 * * 7,575 $500,000
VIA MARCO AURELIO, 37
00184 ROME
ITALY
INTERMARKET FUND S.A. 22,727 $1,500,000 * * 22,727 $1,500,000
C/O BAII ASSET MANAGEMENT
LIMITED
10 PICCADILLY
LONDON W1V OEE
KETTERING MEDICAL 1,287 $85,000 * * 1,287 $85,000
CENTER FUNDED
DEPRECIATION ACCOUNT
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE
ROAD
NAPERVILLE, IL 60563
LINCOLN NATIONAL 33,409 $2,205,000 * 1.2% 33,409 $2,205,000
LIFE INSURANCE
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
LINCOLN NATIONAL 15,227 $1,005,000 * * 15,227 $1,005,000
CONVERTIBLE
SECURITIES FUND
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
LIPPER CONVERTIBLES, 203,787 $13,450,000 1.4% 7.2% 203,787 $13,450,000
L.P.
C/O LIPPER & COMPANY,
L.P.
101 PARK AVENUE
NEW YORK, NY 10178-0694
M&I MARSHALL 1,363 $90,000 * * 1,363 $90,000
& ILSLEY BANK
C/O MARSHALL &
ISLEY TRUST CO.
1000 NORTH WATER ST.
P.O. BOX 2977
MILWAUKEE, WI 53202
MASSACHUSETTS FINANCIAL 30,303 $2,000,000 * 1.1% 30,303 $2,000,000
SERVICES COMPANY
500 BOYLSTON STREET
BOSTON, MA 02116-3741
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- -------
<S> <C> <C> <C> <C>
HUGHES AIRCRAFT COMPANY - - - -
MASTER RETIREMENT TRUST
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
IBM RETIREMENT PLAN - - - -
C/O PALISADE CAPITAL
MANAGEMENT, LLC
ONE BRIDGE PLAZA
FORT LEE, NJ 07024
INGELSA LTD. - - - -
VIA MARCO AURELIO, 37
00184 ROME
ITALY
INTERMARKET FUND S.A. - - - -
C/O BAII ASSET MANAGEMENT
LIMITED
10 PICCADILLY
LONDON W1V OEE
KETTERING MEDICAL - - - -
CENTER FUNDED
DEPRECIATION ACCOUNT
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE
ROAD
NAPERVILLE, IL 60563
LINCOLN NATIONAL - - - -
LIFE INSURANCE
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
LINCOLN NATIONAL - - - -
CONVERTIBLE
SECURITIES FUND
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
LIPPER CONVERTIBLES, - - - -
L.P.
C/O LIPPER & COMPANY,
L.P.
101 PARK AVENUE
NEW YORK, NY 10178-0694
M&I MARSHALL - - - -
& ILSLEY BANK
C/O MARSHALL &
ISLEY TRUST CO.
1000 NORTH WATER ST.
P.O. BOX 2977
MILWAUKEE, WI 53202
MASSACHUSETTS FINANCIAL - - - -
SERVICES COMPANY
500 BOYLSTON STREET
BOSTON, MA 02116-3741
40
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
MEDICO LIFE INSURANCE 757 $50,000 * * 757 $50,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
MEMPHIS LIGHT, GAS & 11,363 $750,000 * * 11,363 $750,000
WATER RETIREMENT
ACCOUNT
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
NEW YORK LIFE INSURANCE 30,303 $2,000,000 * 1.1% 30,303 $2,000,000
& ANNUITY CORPORATION
C/O NEW YORK LIFE
INSURANCE COMPANY
51 MADISON AVENUE
NEW YORK, NY 10010
NEW YORK LIFE 121,212 $8,000,000 * 4.3% 121,212 $8,000,000
INSURANCE COMPANY
51 MADISON AVENUE
NEW YORK, NY 10010
NICHOLAS-APPLEGATE 19,772 $1,305,000 * * 19,772 $1,305,000
INCOME & GROWTH FUND
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
NORWEST BANK MINNESOTA 3,787 $250,000 * * 3,787 $250,000
NATIONAL ASSOCIATION
733 MARQUETTE AVENUE
MINNEAPOLIS, MN 55479-0056
OCCIDENTAL COLLEGE 833 $55,000 * * 833 $55,000
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
OCM CONVERTIBLE TRUST 35,883 $2,365,000 * 1.3% 35,883 $2,365,000
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
OCM CONVERTIBLE LIMITED 2,121 $140,000 * * 2,121 $140,000
PARTNERSHIP
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
OLD KENT BANK 3,181 $210,000 * * 3,181 $210,000
111 LYON N.W.
GRAND RAPIDS, MI 49503
OREGON EQUITY FUND 35,984 $2,375,000 * 1.3% 35,984 $2,375,000
C/O FROLEY, REVY
INVESTMENT COMPANY, INC.
10900 WILSHIRE BOULEVARD
SUITE 1050
LOS ANGELES, CA 90024
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
MEDICO LIFE INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
MEMPHIS LIGHT, GAS & - - - -
WATER RETIREMENT
ACCOUNT
C/O ALLIANCE CAPITAL
MANAGEMENT CORP.
1345 AVENUE OF THE
AMERICAS
NEW YORK, NY 10105
NEW YORK LIFE INSURANCE - - - -
& ANNUITY CORPORATION
C/O NEW YORK LIFE
INSURANCE COMPANY
51 MADISON AVENUE
NEW YORK, NY 10010
NEW YORK LIFE - - - -
INSURANCE COMPANY
51 MADISON AVENUE
NEW YORK, NY 10010
NICHOLAS-APPLEGATE - - - -
INCOME & GROWTH FUND
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
NORWEST BANK MINNESOTA - - - -
NATIONAL ASSOCIATION
733 MARQUETTE AVENUE
MINNEAPOLIS, MN 55479-0056
OCCIDENTAL COLLEGE - - - -
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
OCM CONVERTIBLE TRUST - - - -
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
OCM CONVERTIBLE LIMITED - - - -
PARTNERSHIP
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
OLD KENT BANK - - - -
111 LYON N.W.
GRAND RAPIDS, MI 49503
OREGON EQUITY FUND - - - -
C/O FROLEY, REVY
INVESTMENT COMPANY, INC.
10900 WILSHIRE BOULEVARD
SUITE 1050
LOS ANGELES, CA 90024
41
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
OZARK NATIONAL LIFE 9,848 $650,000 * * 9,848 $650,000
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
P.I.F.S.S. KUWAIT/BAII 22,727 $1,500,000 * * 22,727 $1,500,000
SECURITIES, INC.
C/O BAII ASSET MANAGEMENT
LIMITED
10 PICCADILLY
LONDON W1V OEE
PACIFIC HORIZON CAPITAL 40,909 $2,700,000 * 1.4% 40,909 $2,700,000
INCOME FUND
C/O BANK OF AMERICA
PERSONAL TRUST, PROXY
UNIT #38432
555 S. FLOWER STREET,
LEVEL C
LOS ANGELES, CA 90071
PARTNER REINSURANCE 2,272 $150,000 * * 2,272 $150,000
COMPANY LTD.
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
PELL, RUDMAN & CO., 15,151 $1,000,000 * * 15,151 $1,000,000
INC.
100 FEDERAL STREET
BOSTON, MA 02110
PHICO INSURANCE 3,181 $210,000 * * 3,181 $210,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
PHOENIX, DUSS & PHELPS 60,606 $4,000,000 * 2.1% 60,606 $4,000,000
56 PROSPECT STREET
HARTFORD, CT 06115
PORT AUTHORITY OF 12,878 $850,000 * * 12,878 $850,000
ALLEGHENY COUNTY
RETIREMENT & DISABILITY
ALLOWANCE PLAN FOR
EMPLOYEES REPRESENTED BY
LOCAL 85 OF THE AMALGAMATED
TRANSIT UNION
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
PUBLIC EMPLOYEES' 16,251 $1,000,000 * * 15,151 $1,000,000
RETIREMENT
ASSOCIATION OF
COLORADO
P.O. BOX 5800
DENVER, CO 80217-5800
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
OZARK NATIONAL LIFE - - - -
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
P.I.F.S.S. KUWAIT/BAII - - - -
SECURITIES, INC.
C/O BAII ASSET MANAGEMENT
LIMITED
10 PICCADILLY
LONDON W1V OEE
PACIFIC HORIZON CAPITAL - - - -
INCOME FUND
C/O BANK OF AMERICA
PERSONAL TRUST, PROXY
UNIT #38432
555 S. FLOWER STREET,
LEVEL C
LOS ANGELES, CA 90071
PARTNER REINSURANCE - - - -
COMPANY LTD.
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
PELL, RUDMAN & CO., - - - -
INC.
100 FEDERAL STREET
BOSTON, MA 02110
PHICO INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
PHOENIX, DUSS & PHELPS - - - -
56 PROSPECT STREET
HARTFORD, CT 06115
PORT AUTHORITY OF - - - -
ALLEGHENY COUNTY
RETIREMENT & DISABILITY
ALLOWANCE PLAN FOR
EMPLOYEES REPRESENTED BY
LOCAL 85 OF THE AMALGAMATED
TRANSIT UNION
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
PUBLIC EMPLOYEES' 1,100 - - -
RETIREMENT
ASSOCIATION OF
COLORADO
P.O. BOX 5800
DENVER, CO 80217-5800
42
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
RELIABLE LIFE 3,181 $210,000 * * 3,181 $210,000
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
RJR NABISCO, INC. DEFINED 10,606 $700,000 * * 10,606 $700,000
BENEFIT MASTER TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
SAIF CORPORATION 22,727 $1,500,000 * * 22,727 $1,500,000
C/O FROLEY, REVY
INVESTMENT COMPANY,
INC.
10900 WILSHIRE BOULEVARD
SUITE 1050
LOS ANGELES, CA 90024
SAN DIEGO COUNTY 27,136 $1,791,000 * 1.0% 27,136 $1,791,000
CONVERTIBLE
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
SAN DIEGO CITY RETIREMENT 6,439 $425,000 * * 6,439 $425,000
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
SBC WARBURG INC. 147,727 $9,750,000 1.0% 5.2% 147,727 $9,750,000
141 W. JACKSON BLVD.
CHICAGO, ILLINOIS 60604
SERVICE LIFE INSURANCE 378 $25,000 * * 378 $25,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
SERVICE LLOYD INSURANCE 378 $25,000 * * 378 $25,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
SHEPHERD INVESTMENTS 126,492 $8,348,500 * 4.4% 126,492 $8,348,500
INTERNATIONAL, LTD.
C/O STARO ASSET
MANAGEMENT, L.L.C.
1500 WEST MARKET STREET
SUITE 200
MEQUON, WI 53092
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
RELIABLE LIFE - - - -
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
RJR NABISCO, INC. DEFINED - - - -
BENEFIT MASTER TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
SAIF CORPORATION - - - -
C/O FROLEY, REVY
INVESTMENT COMPANY,
INC.
10900 WILSHIRE BOULEVARD
SUITE 1050
LOS ANGELES, CA 90024
SAN DIEGO COUNTY - - - -
CONVERTIBLE
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
SAN DIEGO CITY RETIREMENT - - - -
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
SBC WARBURG INC. - - - -
141 W. JACKSON BLVD.
CHICAGO, ILLINOIS 60604
SERVICE LIFE INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
SERVICE LLOYD INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
SHEPHERD INVESTMENTS - - - -
INTERNATIONAL, LTD.
C/O STARO ASSET
MANAGEMENT, L.L.C.
1500 WEST MARKET STREET
SUITE 200
MEQUON, WI 53092
43
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
SMIT INTERNATIONAL 943,060 $15,250,000 6.7% 8.1% 231,060 $15,250,000
OVERSEAS N.V.
C/O SMIT INTERNATIONALE N.V.
1 ZALMSTRAAT
3016 DS ROTTERDAM
THE NETHERLANDS
SMM COMPANY B.V. 58,333 $3,850,000 * 2.1% 58,333 $3,850,000
C/O J.P. MORGAN
SECURITIES LTD.
P.O. BOX 161
60 VICTORIA EMBANKMENT
LONDON EC4Y 0JP
SOUTHERN FARM BUREAU LIFE 4,545 $300,000 * * 4,545 $300,000
INSURANCE COMPANY
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
STARK INTERNATIONAL 138,507 $9,141,500 1.0% 4.9% 138,507 $9,141,500
C/O STARO ASSET
MANAGEMENT, L.L.C.
1500 WEST MARKET STREET
SUITE 200
MEQUON, WI 53092
STARVEST DISCRETIONARY 1,893 $125,000 * * 1,893 $125,000
C/O FROLEY, REVY INVESTMENT
COMPANY, INC.
10900 WILSHIRE BOULEVARD
SUITE 1050
LOS ANGELES, CA 90024
STATE EMPLOYEES' 9,090 $600,000 * * 9,090 $600,000
RETIREMENT
FUND OF THE STATE
OF DELAWARE
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
STATE OF CONNECTICUT 27,727 $1,830,000 * 1.0% 27,727 $1,830,000
COMBINED
INVESTMENT FUNDS
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
STEPSTONE CONVERTIBLE 6,439 $425,000 * * 6,439 $425,000
SEC. FUND
C/O BANK OF TOKYO-
MITSUBISHI
TRUST COMPANY (THE)
100 BROADWAY
NEW YORK, NEW YORK 10005
TRANSGUARD INSURANCE 909 $60,000 * * 909 $60,000
OF AMERICA, INC.
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
UBS SECURITIES, LLC 43,939 $2,900,000 * 1.5% 43,939 $2,900,000
299 PARK AVENUE,
8TH FLOOR
NEW YORK, NEW YORK
10171-0026
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- --------
<S> <C> <C> <C> <C>
SMIT INTERNATIONAL 712,000 - - -
OVERSEAS N.V.
C/O SMIT INTERNATIONALE N.V.
1 ZALMSTRAAT
3016 DS ROTTERDAM
THE NETHERLANDS
SMM COMPANY B.V. - - - -
C/O J.P. MORGAN
SECURITIES LTD.
P.O. BOX 161
60 VICTORIA EMBANKMENT
LONDON EC4Y 0JP
SOUTHERN FARM BUREAU LIFE - - - -
INSURANCE COMPANY
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
STARK INTERNATIONAL - - - -
C/O STARO ASSET
MANAGEMENT, L.L.C.
1500 WEST MARKET STREET
SUITE 200
MEQUON, WI 53092
STARVEST DISCRETIONARY - - - -
C/O FROLEY, REVY INVESTMENT
COMPANY, INC.
10900 WILSHIRE BOULEVARD
SUITE 1050
LOS ANGELES, CA 90024
STATE EMPLOYEES' - - - -
RETIREMENT
FUND OF THE STATE
OF DELAWARE
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
STATE OF CONNECTICUT - - - -
COMBINED
INVESTMENT FUNDS
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
STEPSTONE CONVERTIBLE - - - -
SEC. FUND
C/O BANK OF TOKYO-
MITSUBISHI
TRUST COMPANY (THE)
100 BROADWAY
NEW YORK, NEW YORK 10005
TRANSGUARD INSURANCE - - - -
OF AMERICA, INC.
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
UBS SECURITIES, LLC - - - -
299 PARK AVENUE,
8TH FLOOR
NEW YORK, NEW YORK
10171-0026
44
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
UMB BANK, N.A. $132,159 $650,000 * * 122,311 $650,000
P.O. BOX 419260
KANSAS CITY, MO
64141-6260
UNIFI, INC. 2,500 $165,000 * * 2,500 $165,000
PROFIT SHARING
PLAN & TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
UNITED FOOD AND COMMERCIAL 6,818 $450,000 * * 6,818 $450,000
WORKERS LOCAL #1262 &
EMPLOYEES PENSION FUND
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 WARRENVILLE ROAD
NAPERVILLE, IL 60563
UNITED NATIONAL INSURANCE 11,818 $780,000 * * 11,818 $780,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
UNITED NATIONAL LIFE 530 $35,000 * * 530 $35,000
INSURANCE
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
UNITED TEACHERS 9,090 $600,000 * * 9,090 $600,000
ASSOCIATION INSURANCE
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
VANGUARD CONVERTIBLE 20,681 $1,365,000 * * 20,681 $1,365,000
SECURITIES FUND, INC.
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
VI GROWTH & INCOME 7,575 $500,000 * * 7,575 $500,000
C/O AIM CAPITAL
MANAGEMENT INC.
11 GREENWAY PLAZA
SUITE 1919
HOUSTON, TX 77046-1173
WAKE FOREST UNIVERSITY 5,000 $330,000 * * 5,000 $330,000
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
WEIRTON TRUST 3,863 $255,000 * * 3,863 $255,000
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- -------
<S> <C> <C> <C> <C>
UMB BANK, N.A. 122,311 - - -
P.O. BOX 419260
KANSAS CITY, MO
64141-6260
UNIFI, INC. - - - -
PROFIT SHARING
PLAN & TRUST
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 EAST WARRENVILLE ROAD
NAPERVILLE, IL 60563
UNITED FOOD AND COMMERCIAL - - - -
WORKERS LOCAL #1262 &
EMPLOYEES PENSION FUND
C/O CALAMOS ASSET
MANAGEMENT, INC.
1111 WARRENVILLE ROAD
NAPERVILLE, IL 60563
UNITED NATIONAL INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
UNITED NATIONAL LIFE - - - -
INSURANCE
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
UNITED TEACHERS - - - -
ASSOCIATION INSURANCE
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
VANGUARD CONVERTIBLE - - - -
SECURITIES FUND, INC.
C/O OAKTREE CAPITAL
MANAGEMENT, LLC
550 SOUTH HOPE STREET
LOS ANGELES, CA 90071
VI GROWTH & INCOME - - - -
C/O AIM CAPITAL
MANAGEMENT INC.
11 GREENWAY PLAZA
SUITE 1919
HOUSTON, TX 77046-1173
WAKE FOREST UNIVERSITY - - - -
C/O NICHOLAS APPLEGATE
600 WEST BROADWAY
SAN DIEGO, CA 92101
WEIRTON TRUST - - - -
C/O LYNCH & MAYER, INC.
520 MADISON AVENUE
NEW YORK, NY 10022
45
<PAGE>
<PAGE>
<CAPTION>
BENEFICIAL OWNERSHIP
AT FEBRUARY 11, 1997(1) NUMBER PRINCIPAL
---------------------------------------------------- OF AMOUNT
PRINCIPAL PERCENT SHARES OF NOTES
NUMBER AMOUNT OF PERCENT COVERED COVERED BY
SELLING OF OF COMMON OF BY THIS BY THIS
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES PROSPECTUS(2) PROSPECTUS
--------------- --------- ---------- ------- ------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
WESTERN HOME INSURANCE 1,212 $80,000 * * 1,212 $80,000
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
WISCONSIN MUTUAL 1,363 $90,000 * * 1,363 $90,000
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
<CAPTION>
[TABLE RESTUBBED FROM ABOVE]
BENEFICIAL OWNERSHIP
AFTER THE OFFERING(1)
-----------------------------------------------------
PRINCIPAL PERCENT
NUMBER AMOUNT OF PERCENT
SELLING OF OF COMMON OF
SECURITYHOLDERS SHARES(2) NOTES STOCK NOTES
--------------- --------- --------- ------- -------
<S> <C> <C> <C> <C>
WESTERN HOME INSURANCE - - - -
COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
WISCONSIN MUTUAL - - - -
INSURANCE COMPANY
C/O ASSET ALLOCATION
& MANAGEMENT COMPANY
30 NORTH LA SALLE,
SUITE 3600
CHICAGO, IL 60602
<FN>
__________________________
* LESS THAN 1.0%
(1) THE INFORMATION CONTAINED IN THIS TABLE REFLECTS "BENEFICIAL" OWNERSHIP OF
THE COMMON STOCK WITHIN THE MEANING OF RULE 13D-3 UNDER THE EXCHANGE ACT.
ON FEBRUARY 11, 1997, THE COMPANY HAD 13,930,842 SHARES OF COMMON STOCK
OUTSTANDING, NOT INCLUDING 55,768 SHARES OF COMMON STOCK HELD IN THE
COMPANY'S TREASURY. UNLESS OTHERWISE INDICATED, ALL SHARES OF COMMON STOCK
ARE HELD DIRECTLY WITH SOLE VOTING AND DISPOSITIVE POWER. BENEFICIAL
OWNERSHIP INFORMATION REFLECTED IN THIS TABLE INCLUDES SHARES ISSUABLE
UPON THE EXERCISE OF OUTSTANDING STOCK OPTIONS.
(2) INCLUDES SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THE NOTES.
</FN>
</TABLE>
46
<PAGE>
<PAGE>
CERTAIN UNITED STATES FEDERAL TAX CONSIDERATIONS
The following general discussion summarizes certain of the material U.S.
federal income tax aspects of the acquisition, ownership and disposition of the
Notes or Common Stock. This discussion is a summary for general information only
and does not consider all aspects of U.S. federal income tax that may be
relevant to the purchase, ownership and disposition of the Notes or Common Stock
by a prospective investor in light of such investor's personal circumstances.
This discussion also does not address the U.S. federal income tax consequences
of ownership of Notes or Common Stock not held as capital assets within the
meaning of Section 1221 of the U.S. Internal Revenue Code of 1986, as amended
(the "Code"), or the U.S. federal income tax consequences to investors subject
to special treatment under the U.S. federal income tax laws, such as dealers in
securities or foreign currency, tax-exempt entities, banks, thrifts, insurance
companies or other financial institutions, persons that hold the Notes or Common
Stock as part of a "straddle," a "hedge" against currency risk or a "conversion
transaction," persons that have a "functional currency" other than the U.S.
dollar, and investors in pass-through entities. In addition, this discussion is
generally limited to the tax consequences to initial holders. Moreover, the
effect of any applicable state, local or foreign tax laws is not discussed.
This discussion is based upon the Code, existing and proposed regulations
thereunder, and current administrative rulings and court decisions. All of the
foregoing is subject to change, possibly on a retroactive basis, and any such
change could affect the continuing validity of this discussion.
PERSONS CONSIDERING THE PURCHASE OF NOTES SHOULD CONSULT THEIR OWN TAX
ADVISORS CONCERNING THE APPLICATION OF FEDERAL INCOME TAX LAWS, AS WELL AS THE
LAWS OF ANY STATE, LOCAL OR FOREIGN TAXING JURISDICTION, TO THEIR PARTICULAR
SITUATIONS.
U.S. HOLDERS
The following discussion is limited to the U.S. federal income tax
consequences relevant to a holder of a Note that is a U.S. Holder. A U.S. Holder
is defined as (i) a citizen or resident (as defined in Section 7701(b)(l) of the
Code) of the United States, (ii) a corporation organized in or under the laws of
the United States or any political subdivision thereof, (iii) any estate other
than a Foreign Estate, or (iv) a U.S. Trust. A "Foreign Estate" means an estate
the income of which is not includible in gross income for U.S. federal income
tax purposes because it is from sources outside the United States and is not
effectively connected with the conduct of a trade or business within the United
States. A trust is a U.S. Trust if such trust is subject to U.S. federal income
tax regardless of the source of its income. For taxable years beginning after
December 31, 1996 (or for taxable years ending after August 20, 1996, if the
trustee has made an applicable election), a trust is a U.S. Trust if a court
within the United States is able to exercise primary supervision over the
administration of such trust, and one or more United States fiduciaries have the
authority to control all substantial decisions of such trust. Certain U.S.
federal income tax consequences relevant to a holder other than a U.S. Holder
are discussed separately below.
STATED INTEREST
The stated interest on a Note will be taxable to a U.S. Holder as ordinary
interest income either at the time it accrues or is received depending upon such
U.S. Holder's method of accounting for federal income tax purposes. For this
purpose, interest will be deemed to accrue without regard to conversion of the
Notes. If the Company fails to comply with certain provisions of the November
1996 Registration Rights Agreement or the Smit Registration Rights Agreement
then additional interest will become payable with respect to the Notes. See
"Description of Notes--Registration Rights." Assuming that the contingency that
the Company will pay such additional interest is "remote and incidental" within
the meaning of applicable Treasury regulations, the Company believes that such
additional interest will be taxable to U.S. Holders at the time it accrues or is
received in accordance with each such holder's method of accounting.
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MARKET DISCOUNT
Gain recognized on the disposition (including a redemption) by a
subsequent purchaser of a Note that has accrued market discount will be treated
as ordinary income, and not capital gain, to the extent of the accrued market
discount, provided that the amount of market discount exceeds a statutorily
defined de minimis amount. "Market discount" is defined as the excess, if any,
of (i) the stated redemption price at maturity over (ii) the tax basis of the
debt obligation in the hands of the holder immediately after its acquisition.
Under the de minimis exception, there is no market discount if the excess
of the stated redemption price at maturity of the obligation over the holder's
tax basis in the obligation is less than 0.25% of the stated redemption price at
maturity multiplied by the number of complete years after the acquisition date
to the Note's date of maturity. Unless a holder elects otherwise, the accrued
market discount would be the amount calculated by multiplying the market
discount by a fraction, the numerator of which is the number of days the
obligation has been held by a holder and the denominator of which is the number
of days after the holder's acquisition of the obligation up to and including its
maturity date.
If a U.S. Holder of a Note acquired at market discount disposes of such
Note in any transaction other than a sale, exchange or involuntary conversion,
even though otherwise non-taxable (e.g., a gift), such U.S. Holder will be
deemed to have realized an amount equal to the fair market value of the Note and
would be required to recognize as ordinary income any accrued market discount to
the extent of the deemed gain. A U.S. Holder of a Note acquired at a market
discount also may be required to defer the deduction of all or a portion of the
interest on any indebtedness incurred or maintained to carry the Note until it
is disposed of in a taxable transaction.
A U.S. Holder of a Note acquired at market discount may elect to include
the market discount in income as it accrues. This election would apply to all
market discount obligations acquired by the electing U.S. Holder on or after the
first day of the first taxable year to which the election applies. The election
may be revoked only with the consent of the U.S. Internal Revenue Service (the
"Service"). If a U.S. Holder of a Note so elects to include market discount in
income currently, the above-discussed rules with respect to ordinary income
recognition resulting from sales and certain other disposition transactions and
to deferral of interest deductions would not apply.
BOND PREMIUM
If a U.S. Holder purchases a Note at a cost that is in excess of the
amount payable on maturity (which will be determined by reference to an earlier
call date if the call price would reduce the amount of the premium) (such excess
being the "bond premium"), a U.S. Holder may elect under Section 171 of the Code
to amortize such bond premium on a constant interest basis over the period from
the acquisition date to the maturity date of such Note (or, in certain
circumstances, until an earlier call date) and, except as future Treasury
regulations may otherwise provide, reduce the amount of interest included in
income in respect of the Note by such amount. A U.S. Holder who elects to
amortize bond premium must reduce its adjusted basis in the Note by the amount
of such allowable amortization. An election to amortize bond premium would apply
to all amortizable bond premium on all taxable bonds held at or acquired after
the beginning of the U.S. Holder's taxable year as to which the election is
made, and may be revoked only with the consent of the Service. No amortization
is allowed for any premium attributable to the conversion feature of a Note.
If an election to amortize bond premium is not made, a U.S. Holder must
include the full amount of each interest payment in income in accordance with
its regular method of accounting and will generally receive a tax benefit from
the bond premium only upon computing its gain or loss upon the sale or other
disposition or payment of the principal amount of the Note.
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On June 27, 1996, the Service published in the Federal Register proposed
regulations on the amortization of bond premium. Under those regulations, if a
taxpayer elects to amortize bond premium, such bond premium would generally be
amortized on a constant yield method and would be applied against qualified
stated interest. The proposed regulations generally would be effective for Notes
acquired on or after the date 60 days after the date final regulations are
published in the Federal Register (the "Final Regulation Date"), provided,
however, if a taxpayer makes the election to amortize bond premium for the
taxable year containing the Final Regulation Date, the proposed regulations
would be effective for Notes held on or after the first day of that taxable
year.
TAX BASIS
A U.S. Holder's initial tax basis in a Note will be equal to the purchase
price paid by such U.S. Holder for such Note.
SALE OR REDEMPTION
Unless a nonrecognition provision applies, the sale, exchange, redemption
(including pursuant to an offer by the Company) or other disposition of a Note
will be a taxable event for federal income tax purposes. In such event, a U.S.
Holder will recognize gain or loss equal to the difference between (i) the
amount of cash plus the fair market value of any property received upon such
sale, exchange, redemption or other taxable disposition (other than in respect
of accrued and unpaid interest thereon) and (ii) the U.S. holder's adjusted tax
basis therein (other than any tax basis attributable to accrued and unpaid
interest). Subject to the discussion above under the caption "Market Discount,"
such gain or loss should be capital gain or loss and will be long-term capital
gain or loss if the Note had been held by the U.S. Holder for more than one year
at the time of such sale, exchange, redemption or other disposition.
CONVERSION OF NOTE INTO COMMON STOCK
No gain or loss will be recognized for federal income tax purposes on
conversion of Notes solely into shares of Common Stock, except with respect to
any cash received in lieu of a fractional share or, in the case of both cash and
accrual basis taxpayers, any accrued interest not previously included in income.
To the extent the conversion is not treated as resulting in the payment of
interest, the tax basis for the shares of Common Stock received upon conversion
will be equal to the tax basis of the Notes converted into Common Stock, and the
holding period of the shares of Common Stock will include the holding period of
the Notes converted. Any accrued market discount not previously included in
income as of the date of the conversion of the Notes and not recognized upon the
conversion (e.g., as a result of the receipt of cash in lieu of a fractional
interest in a Note) should carry over to the Common Stock received on conversion
and be treated as ordinary income upon the subsequent disposition of such Common
Stock.
ADJUSTMENT OF CONVERSION PRICE
Section 305 of the Code treats as a distribution taxable as a dividend (to
the extent of the issuing corporation's current or accumulated earnings and
profits) certain actual or constructive distributions of stock with respect to
stock or convertible securities. Under Treasury regulations, an adjustment in
the conversion price, or the failure to make such an adjustment, may, under
certain circumstances be treated as a constructive dividend. Generally, a U.S.
Holder's tax basis in a Note will be increased by the amount of any such
constructive dividend.
BACK-UP WITHHOLDING
A U.S. Holder of Notes or Common Stock may be subject to "back-up
withholding" at a rate of 31% with respect to certain "reportable payments,"
including interest payments, dividend payments and, under certain circumstances,
principal payments on the Notes or proceeds from the disposition of Common
Stock. These back-
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up withholding rules apply if the U.S. Holder, among other things, (i) fails to
furnish a social security number or other taxpayer identification number (TIN)
certified under penalties of perjury within a reasonable time after the request
therefor, (ii) furnishes an incorrect TIN, (iii) fails to report properly
interest or dividends, or (iv) under certain circumstances, fails to provide a
certified statement, signed under penalties of perjury, that the TIN furnished
is the correct number and that such holder is not subject to back-up
withholding. A U.S. Holder who does not provide the Company with its correct TIN
also may be subject to penalties imposed by the Service. Any amount withheld
from a payment to a U.S. Holder under the back-up withholding rules is
creditable against the U.S. Holder's federal income tax liability, provided the
required information is furnished to the Service. Back-up withholding will not
apply, however, with respect to payments made to certain holders, including
corporations and tax-exempt organizations, provided their exemption from back-up
withholding is properly established.
The Company will report to the U.S. Holders of Notes and Common Stock and
to the Service the amount of any "reportable payments" for each calendar year
and the amount of tax withheld, if any, with respect to such payments.
NON-U.S. HOLDERS
The following discussion is limited to the U.S. federal income tax
consequences relevant to a holder of a Note that is not a U.S. Holder, as
defined above ("Non-U.S. Holder").
For purposes of withholding tax on interest and dividends discussed below,
a non-resident alien or other non-resident fiduciary of an estate or trust will
be considered a Non-U.S. Holder. For purposes of the following discussion,
interest, dividends and gain on the sale exchange or other disposition of a Note
or Common Stock will be considered to be "U.S. trade or business income" if such
income or gain is (i) effectively connected with the conduct of a U.S. trade or
business or (ii) in the case of a treaty resident, attributable to a permanent
establishment (or, in the case of an individual, a fixed base) in the United
States.
STATED INTEREST
Generally any interest paid to a Non-U.S. Holder of a Note that is not
U.S. trade or business income will not be subject to U.S. tax if the interest
qualifies as "portfolio interest." Generally interest on the Notes will qualify
as portfolio interest if (i) the Non-U.S. Holder does not actually or
constructively own 10% or more of the total voting power of all voting stock of
the Company and is not a "controlled foreign corporation" with respect to which
the Company is a "related person" within the meaning of the Code, and (ii) the
beneficial owner, under penalty or perjury, certifies that the beneficial owner
is not a United States person and such certificate provides the beneficial
owner's name and address, and (iii) the Non-U.S. Holder is not a bank receiving
interest on an extension of credit made pursuant to a loan agreement made in the
ordinary course of its trade or business.
The gross amount of payments to a Non-U.S. Holder of interest that do not
qualify for the portfolio interest exception and that are not U.S. trade or
business income will be subject to U.S. federal income tax at the rate of 30%,
unless a U.S. income tax treaty applies to reduce or eliminate withholding. U.S.
trade or business income will be taxed at regular U.S. rates rather than the 30%
gross rate. In the case of a Non- U.S. Holder that is a corporation, such United
States trade or business income may also be subject to the branch profits tax
(which is generally imposed on a foreign corporation on the actual or deemed
repatriation from the United States of earnings and profits attributable to
United States trade or business income) at a 30% rate. The branch profits tax
may not apply (or may apply at a reduced rate) if a recipient is a qualified
resident of certain countries with which the United States has an income tax
treaty. To claim the benefit of a tax treaty or to claim exemption from
withholding because the income is U.S. trade or business income, the Non-U.S.
Holder must provide a properly executed Form 1001 or 4224 (or such successor
forms as the Service designates), as applicable, prior to the payment of
interest. These forms must be periodically updated. Under proposed regulations,
the Forms 1001 and 4224 will be replaced by Form W-8. Also, under proposed
regulations, a Non-U.S. Holder who is claiming the
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benefits of a treaty may be required to obtain a U.S. taxpayer identification
number and to provide certain documentary evidence issued by foreign
governmental authorities to prove residence in the foreign country. Certain
special procedures are provided in the proposed regulations for payments through
qualified intermediaries.
DIVIDENDS
In general, dividends paid to a Non-U.S. Holder of Common Stock will be
subject to withholding of U.S. federal income tax at a 30% rate unless such is
reduced by an applicable income tax treaty. Dividends that are connected with
such holder's conduct of a trade or business in the United States or (U.S. trade
or business income) are generally subject to U.S. federal income tax at regular
rates, but are not generally subject to the 30% withholding tax if the Non-U.S.
Holder files the appropriate form with the payor, as discussed above. Any U.S.
trade or business income received by a Non-U.S. Holder that is a corporation may
also, under certain circumstances, be subject to an additional "branch profits
tax" at a 30% rate or such lower rate as may be applicable under an income tax
treaty. Dividends paid to an address in a foreign country generally are presumed
(absent actual knowledge to the contrary) to be paid to a resident of such
country for purposes of the withholding discussed above and for purposes of
determining the applicability of a tax treaty rate. Under proposed U.S. Treasury
regulations, not currently in effect, however, a Non-U.S. Holder of Common Stock
who wishes to claim the benefit of an applicable treaty rate would be required
to satisfy applicable certification and other requirements, which would include
the requirement that the Non-U.S. Holder file a form which contains the holder's
name and address or provides certain documentary evidence issued by foreign
governmental authorities to prove residence in the foreign country.
A Non-U.S. Holder of Common Stock that is eligible for a reduced rate of
U.S. withholding tax pursuant to an income treaty may obtain a refund of any
excess amounts currently withheld by filing an appropriate claim for a refund
with the Service.
CONVERSION
A Non-U.S. Holder generally will not be subject to U.S federal income tax
on the conversion of Notes into Common Stock, except with respect to cash (if
any) received in lieu of a fractional share or interest not previously included
in income. Cash in lieu of a fractional share may give rise to gain that would
be subject to the rules described below for the sale of Notes. Cash or Common
Stock treated as issued for accrued interest would be treated as interest under
the rules described above.
SALE, EXCHANGE OR REDEMPTION OF NOTES OR COMMON STOCK
Except as described below and subject to the discussion concerning backup
withholding, any gain realized by a Non-U.S. Holder on the sale, exchange or
redemption of a Note or Common Stock generally will not be subject to U.S.
federal income tax, unless (i) such gain is U.S. trade or business income, (ii)
subject to certain exceptions, the Non-U.S. Holder is an individual who holds
the Note or Common Stock as a capital asset and is present in the United States
for 183 days or more in the taxable year of the disposition, (iii) the Non-U.S.
Holder is subject to tax pursuant to the provisions of U.S. tax law applicable
to certain U.S. expatriates (including certain former citizens or residents of
the United States) and (iv) in the case of the disposition of Common Stock, the
Company has not been and does not become a U.S. real property holding company.
FEDERAL ESTATE TAX
Notes held (or treated as held) by an individual who is not a citizen or
resident of the United States (for federal estate tax purposes) at the time of
his or her death will not be subject to U.S. federal estate tax provided that
the individual does not actually or constructively own 10% or more of the total
voting power of all voting stock of the Company and income on the Notes was not
U.S. trade or business income. Common Stock owned or
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treated as owned by an individual who is not a citizen or resident of the United
States (for federal estate tax purposes) will be included in such individual's
estate for U.S. federal income tax purposes unless an applicable estate tax
treaty otherwise applies.
INFORMATION REPORTING AND BACKUP WITHHOLDING
The Company must report annually to the Service and to each Non-U.S.
Holder any interest or dividend that is subject to withholding, or that is
exempt from U.S. withholding tax pursuant to a tax treaty, or interest that is
exempt from U.S. tax under the portfolio interest exception. Copies of these
information returns may also be made available under the provisions of a
specific treaty or agreement to the tax authorities of the country in which the
Non-U.S. Holder resides.
The Treasury regulations provide that backup withholding and information
reporting will not apply to payments of principal on the Notes or Common Stock
by the Company to a Non-U.S. Holder, if the Holder certifies as to its non-U.S.
status under penalties of perjury or otherwise establishes an exemption
(provided that neither the Company nor its paying agent has actual knowledge
that the holder is a United States person or that the conditions of any other
exemption are not, in fact, satisfied.)
The payment of the proceeds from the disposition of Notes or Common Stock
to or through the United States office of any broker, U.S. or foreign, will be
subject to information reporting and possible backup withholding unless the
owner certifies as its non-U.S. status under penalty of perjury or otherwise
establishes an exemption, provided that the broker does not have actual
knowledge that the Holder is a U.S. person or that the conditions of any other
exemption are not, in fact, satisfied. The payment of the proceeds from the
disposition of a Note to or through a non-U.S. office of a non-U.S. broker that
is not a U.S. related person will not be subject to information reporting or
backup withholding. For this purpose, a "U.S. related person" is (i) a
"controlled foreign corporation" for U.S. federal income tax purposes or (ii) a
foreign person 50% or more of whose gross income from all sources for the
three-year period ending with the close of its taxable year preceding the
payment (or for such part of the period that the broker has been in existence)
is derived from activities that are effectively connected with the conduct of a
United States trade or business.
In the case of the payment of proceeds from the disposition of Notes or
Common Stock to or through a non-U.S. office of a broker that is either a U.S.
person or a U.S. related person, the regulations require information reporting
on the payment unless the broker has documentary evidence in its files that the
owner is a Non-U.S. Holder and the broker has no knowledge to the contrary.
Backup withholding will not apply to payments made through foreign offices of a
broker that is not a U.S. person or a U.S. related person (absent actual
knowledge that the payee is a U.S. person).
Any amounts withheld under the backup withholding rules from a payment to
a Non-U.S. Holder will be allowed as a refund or a credit against such Non-U.S.
Holder's U.S. federal income tax liability, provided that the requisite
procedures are followed.
THE PRECEDING DISCUSSION OF CERTAIN UNITED STATES FEDERAL INCOME TAX
CONSEQUENCES IS FOR GENERAL INFORMATION ONLY AND IS NOT TAX ADVICE. ACCORDINGLY,
EACH INVESTOR SHOULD CONSULT ITS OWN TAX ADVISER AS TO PARTICULAR TAX
CONSEQUENCES TO IT OF PURCHASING, HOLDING AND DISPOSING OF THE NOTES AND THE
COMMON STOCK OF THE COMPANY, INCLUDING THE APPLICABILITY AND EFFECT OF ANY
STATE, LOCAL OR FOREIGN TAX LAWS, AND OF ANY PROPOSED CHANGES IN APPLICABLE
LAWS.
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PLAN OF DISTRIBUTION
The Selling Securityholders have advised the Company that the Securities
may be sold from time to time by the Selling Securityholders, or their
transferees, in transactions effected on the NYSE (or through the facilities of
any national securities exchange or U.S. automated interdealer quotation system
of a registered national securities association, on which any of the Securities
are then listed, admitted to unlisted trading privileges or included for
quotation), in privately negotiated transactions or otherwise. The Securities
will not be sold in an underwritten public offering. The Securities will be sold
at prices and on terms then prevailing, at prices related to the then-current
market price of the Securities, or at negotiated prices. The Company has been
advised that the Selling Securityholders may effect sales of the Securities
directly, or indirectly by or through agents or broker-dealers and that the
Securities may be sold by one or more of the following methods: (a) ordinary
brokerage transactions, (b) purchases by a broker-dealer as principal and resale
by such broker-dealer for its own account, and (c) in "block" sale transactions.
At the time a particular offer is made, a Prospectus Supplement, if required,
will be distributed that sets forth the name or names of agents or
broker-dealers, any commissions and other terms constituting selling
compensation and any other required information. Moreover, in effecting sales,
broker-dealers engaged by any Selling Securityholder and/or the purchasers of
the Securities may arrange for other broker-dealers to participate in the sale
process. Broker-dealers will receive discounts or commissions from the Selling
Securityholders and/or the purchasers of the Securities in amounts which will be
negotiated prior to the time of sale. Sales will be made only through
broker-dealers registered as such in a subject jurisdiction or in transactions
exempt from such registration. The Company has not been advised of any
definitive selling arrangement at the date of this Prospectus between any
Selling Securityholder and any broker-dealer or agent.
In connection with the distribution of the Securities, certain of the
Selling Securityholders may enter into hedging transactions with broker-dealers.
In connection with such transactions, broker-dealers may engage in short sales
of the Securities in the course of hedging the positions they assume with the
Selling Securityholders. The Selling Securityholders may also sell the
Securities short and redeliver the Securities to close out the short positions.
The Selling Securityholders may also enter into option or other transactions
with broker-dealers which require the delivery of the Securities to the
broker-dealer. The Selling Securityholders may also loan or pledge the
Securities to a broker-dealer and the broker-dealer may sell the Securities so
loaned or, upon a default, the broker-dealer may effect sales of the pledged
shares.
Any broker-dealer participating in any distribution of Securities in
connection with the offering made hereby may be deemed to be an "underwriter"
within the meaning of the Securities Act and may be required to deliver a copy
of this Prospectus, including a Prospectus Supplement, to any person who
purchases any of the Securities from or through such broker-dealer.
In addition, the Selling Securityholders may from time to time sell the
Securities in transactions under Rule 144 under the Securities Act.
Under the Registration Rights Agreements, SEACOR is required to comply
with the requirements of Rule 144(c) under the Securities Act, as such Rule may
be amended from time to time (or any similar rule or regulation hereafter
adopted by the Commission), regarding the availability of current public
information to the extent required to enable the Selling Securityholders to sell
Securities without registration under the Securities Act pursuant to Rule 144
(or any similar rule or regulation).
Pursuant to the Registration Rights Agreements, all expenses of
registration of the Securities will be paid by SEACOR, including Commission
filing fees, and expenses of compliance with state securities or "blue sky"
laws. The Selling Securityholders will be indemnified by SEACOR against certain
civil liabilities, including certain liabilities arising under the Securities
Act, or, to the extent such indemnification is unavailable or otherwise limited,
will be entitled to contribution in connection therewith. The Company will not
receive any of the proceeds from the sale of the Securities by the Selling
Securityholders.
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NOTICE TO CANADIAN RESIDENTS
RESALE RESTRICTIONS
The distribution of the Securities in Canada is being made only on a
private placement basis exempt from the requirement that the Company prepare and
file a prospectus with the securities regulatory authorities in each province
where trades of the Securities are effected. Accordingly, any resale of the
Securities in Canada must be made in accordance with applicable securities laws
which will vary depending on the relevant jurisdiction, and which may require
resales to be made in accordance with available statutory exemptions or pursuant
to a discretionary exemption granted by the applicable Canadian securities
regulatory authority. Purchasers are advised to seek legal advice prior to any
resale of the Securities.
REPRESENTATIONS OF PURCHASERS
Each purchaser of the Securities in Canada who receives a purchase
confirmation will be deemed to represent to the Company and the dealer from whom
such purchase confirmation is received that (i) such purchaser is entitled under
applicable provincial securities laws to purchase such Securities without the
benefit of a prospectus qualified under such securities laws, (ii) where
required by law, that such purchaser is purchasing as principal and not as
agent, and (iii) such purchaser has reviewed the text above under "Resale
Restrictions."
RIGHTS OF ACTION AND ENFORCEMENT
The Securities being offered are those of a foreign issuer and Ontario
purchasers will not receive the contractual right of action prescribed by
section 32 of the Regulation under the Securities Act (Ontario). As a result,
Ontario purchasers must rely on other remedies that may be available, including
common law rights of action for damages or rescission or rights of action under
the civil liability provisions of the U.S. Federal securities laws. Following a
recent decision of the U.S. Supreme Court, it is possible that Ontario
purchasers will not be able to rely upon the remedies set out in Section 12(2)
of the United States Securities Act of 1933 if the securities are being offered
under a U.S. private placement memorandum.
All of the issuer's directors and officers as well as the experts named
herein may be located outside of Canada and, as a result, it may not be possible
for Ontario purchasers to effect service of process within Canada upon the
issuer of such persons. All or a substantial portion of the assets of the issuer
and such persons may be located outside of Canada and, as a result, it may not
be possible to satisfy a judgment against the issuer or such person in Canada or
to enforce a judgment obtained in Canadian courts against such issuer or persons
outside of Canada.
NOTICE TO BRITISH COLUMBIA RESIDENTS
A purchaser of the Securities to whom the Securities Act (British
Columbia) applies is advised that such purchaser is required to file with the
British Columbia Securities Commission a report within ten days of the sale of
any Securities acquired by such purchaser pursuant to this offering. Such report
must be in the form attached to British Columbia Securities Commission Blanket
Order BOR #95/17, a copy of which may be obtained from the Company. Only one
such report must be filed in respect of the Securities acquired on the same date
and under the same prospectus exemption.
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LIMITATION ON FOREIGN OWNERSHIP OF SECURITIES
The Shares offered hereby are subject to certain limitations on foreign
ownership, and as a condition to the receipt of shares of Common Stock upon
conversion of the Notes, holders of the notes will be required to furnish a
certification as to, and under certain circumstances, additional proof of,
citizenship. In addition, a foreign holder of the Notes may, by reason of such
limitations, receive a lesser number of shares of Common Stock upon conversion
of the Notes than it otherwise may be entitled to receive pursuant to the terms
of the Notes and the Indenture. See "Risk Factors--Restrictions on Foreign
Ownership of Common Stock" and "Description of Notes--Conversion Rights."
LEGAL MATTERS
The legality of the Securities offered hereby will be passed upon for
SEACOR by Weil, Gotshal & Manges LLP.
EXPERTS
The audited consolidated financial statements of the Company for the year
ended December 31, 1995 included in and incorporated by reference in this
Prospectus from the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995, the Company's Current Report on Form 8-K dated May 31,
1996 and filed with the Commission on June 7, 1996 and the Company's Current
Report on Form 8-K dated May 31, 1996 and filed with the Commission on June 14,
1996 have been audited, and the pro forma financial information for the year
ended December 31, 1995 incorporated by reference in this Prospectus from the
Company's Current Report on Form 8-K dated May 31, 1996 and filed with the
Commission on June 7, 1996, have been examined by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto and have been so incorporated in reliance upon the reports of such firm
given their authority as experts in accounting and auditing. In its report on
the Company for 1995, Arthur Andersen LLP states that with respect to a certain
subsidiary, its opinion is based on the report of other independent public
accountants, namely Coopers & Lybrand L.L.P. The report referred to above has
been incorporated by reference in this Prospectus upon the authority of that
firm as experts in accounting and auditing.
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<TABLE>
<CAPTION>
INDEX TO FINANCIAL STATEMENTS
PAGE
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<S> <C>
Report of Independent Public Accountants............................................................. F-2
Consolidated Balance Sheets-December 31, 1995 and 1994............................................... F-3
Consolidated Statements of Income for each of the three years ended
December 31, 1995, 1994, and 1993................................................................. F-4
Consolidated Statements of Changes in Equity for each of the three years ended
December 31, 1995, 1994, and 1993................................................................. F-5
Consolidated Statements of Cash Flows for each of the three years ended
December 31, 1995, 1994, and 1993................................................................. F-6
Notes to Consolidated Financial Statements........................................................... F-7
Condensed Consolidated Balance Sheet-September 30, 1996.............................................. F-30
Condensed Consolidated Statements of Income for the three and nine months
ended September 30, 1996 and 1995................................................................. F-31
Condensed Consolidated Statements of Cash Flows for the nine months ended
September 30, 1996 and 1995....................................................................... F-32
Notes to Condensed Consolidated Financial Statements................................................. F-33
</TABLE>
F-1
<PAGE>
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To SEACOR Holdings, Inc.:
We have audited the accompanying consolidated balance sheets of SEACOR
Holdings, Inc. (a Delaware corporation) and subsidiaries as of December 31, 1995
and 1994 and the related consolidated statements of income, changes in equity
and cash flows for each of the three years in the period ended December 31,
1995. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits. We did not audit the financial statements of CRN
Holdings Inc. and subsidiaries, which statements reflect total assets and total
revenues of 9 percent and 17 percent, respectively, in 1995 of the consolidated
totals. Those statements were audited by other auditors whose report has been
furnished to us and our opinion, insofar as it relates to the amounts included
for those entities, is based solely on the report of the other auditors.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits and the report of other auditors provide a reasonable
basis for our opinion.
In our opinion, based on our audits and the report of other auditors,
the financial statements referred to above present fairly, in all material
respects, the financial position of SEACOR Holdings, Inc. and subsidiaries as of
December 31, 1995 and 1994 and the results of their operations and their cash
flows for each of the three years in the period ended December 31, 1995, in
conformity with generally accepted accounting principles.
Arthur Andersen LLP
New Orleans, Louisiana
June 7, 1996
F-2
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
(IN THOUSANDS, EXCEPT SHARE DATA)
ASSETS 1995 1994
---- ----
<S> <C> <C>
Current Assets:
Cash and temporary cash investments, including restricted
cash of $305 in 1994..................................................$ 28,786 $ 44,637
Investment Securities..................................................... 623 595
Trade and other receivables, net of allowance for doubtful
accounts of $380 and $108, respectively............................... 32,900 13,844
Affiliate receivables..................................................... 872 2,594
Inventories............................................................... 1,602 577
Prepaid expenses and other................................................ 3,490 1,047
----------- -----------
Total current assets............................................... 68,273 63,294
----------- -----------
Investments in and Receivables from 50% or Less Owned
Companies, at Equity...................................................... 6,484 6,137
----------- -----------
Property and Equipment:
Vessels and equipment..................................................... 327,352 222,142
Other ................................................................... 10,594 3,611
----------- -----------
337,946 225,753
Less-accumulated depreciation......................................... 75,038 59,726
----------- -----------
262,908 166,027
----------- -----------
Other Assets................................................................ 13,218 2,687
----------- -----------
$ 350,883 $ 238,145
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt.........................................$ 2,489 $ 5,896
Loans from stockholders................................................... 1,665 1,470
Accounts payable-trade.................................................... 7,742 3,245
Accounts payable-affiliates............................................... - 396
Accrued insurance......................................................... 975 885
Accrued wages............................................................. 1,252 565
Accrued income taxes...................................................... 1,365 498
Other current liabilities................................................. 4,262 2,982
----------- -----------
Total current liabilities............................................. 19,750 15,937
----------- -----------
Long-Term Debt.............................................................. 108,066 73,621
Deferred Income Taxes....................................................... 36,182 34,093
Deferred Gain and Other Liabilities......................................... 2,484 1,733
Minority Interest in Subsidiary............................................. 937 1,279
Stockholders' Equity:
Common stock, $.01 par value, 20,000,000 shares authorized;
9,886,393 and 7,198,123 shares issued and 9,830,625 and 7,142,355
shares outstanding in 1995 and 1994, respectively......................... 99 72
Additional paid-in capital.................................................. 127,317 66,319
Retained earnings........................................................... 57,852 46,528
Less 55,768 shares held in treasury, at cost................................ (576) (576)
Unamortized restricted stock................................................ (159) -
Currency translation adjustments............................................ (1,069) (861)
----------- -----------
Total stockholders' equity............................................ 183,464 111,482
----------- -----------
$ 350,883 $ 238,145
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements and
should be read in conjunction herewith.
F-3<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994, AND 1993
(IN THOUSANDS, EXCEPT SHARE DATA)
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Operating Revenue:
Marine ................................................... $104,894 $93,985 $92,168
Environmental-
Oil spill response 8,927 - -
Retainer and other services 12,838 - -
--------- ------- -------
126,659 93,985 92,168
--------- ------- -------
Costs and Expenses:
Cost of spill response.................................... 7,643 - -
Operating expenses-
Marine................................................ 66,205 55,860 53,958
Environmental......................................... 4,580 - -
Administrative and general................................ 13,953 7,278 7,187
Depreciation and amortization............................. 18,842 14,108 12,107
--------- ------- -------
111,223 77,246 73,252
--------- ------- -------
Operating Income.............................................. 15,436 16,739 18,916
Other Income (Expense):
Interest income........................................... 2,370 1,874 1,063
Other..................................................... 667 (267) 122
Gain/(loss) from equipment sales or retirements........... 3,850 (388) (8)
Interest expense.......................................... (6,681) (5,422) (4,782)
--------- ------- -------
206 (4,203) (3,605)
--------- ------- -------
Income Before Income Taxes, Minority Interest,
Equity in Earnings of 50% or Less Owned
Companies, and Extraordinary Item......................... 15,642 12,536 15,311
Income Tax Expense (Benefit):
Current................................................... 5,175 4,516 3,998
Deferred.................................................. 335 (148) 1,341
--------- ------- -------
5,510 4,368 5,339
--------- ------- -------
Income Before Minority Interest, Equity in Earnings of 50% or
Less Owned Companies, and Extraordinary Item............... 10,132 8,168 9,972
Minority Interest in (Income) Loss of Subsidiary.............. 321 184 (51)
Equity in Net Earnings of 50% or Less Owned Companies......... 872 975 287
--------- ------- -------
Income Before Extraordinary Item.............................. 11,325 9,327 10,208
Extraordinary Item-Loss on Extinguishment of Debt............. - - (1,093)
--------- ------- -------
Net Income.................................................... $ 11,325 $ 9,327 $ 9,115
========= ======= =======
Earnings (Loss) Per Common Share-Assuming
No Dilution:
Income before extraordinary item........................... $ 1.50 $ 1.31 $ 1.43
Extraordinary item......................................... - - (0.15)
--------- ---------- --------
Net income................................................. $ 1.50 $ 1.31 $ 1.28
========= ======== ========
Earnings (Loss) Per Common Share-Assuming
Full Dilution:
Income before extraordinary item........................... $ 1.36 $ 1.22 $ 1.36
Extraordinary item......................................... - - (0.14)
-------- --------- --------
Net income................................................. $ 1.36 $ 1.22 $ 1.22
======== ======== ========
Weighted Average Common Shares:
Assuming no dilution....................................... 7,547,330 7,142,355 7,127,697
Assuming full dilution..................................... 10,032,332 9,625,544 8,366,724
</TABLE>
The accompanying notes are an integral part of these financial statements and
should be read in conjunction herewith.
F-4<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994, AND 1993
(IN THOUSANDS)
Common Additional Retained Treasury Unamortized Currency
Stock Paid-in Earnings Stock Restricted Translation
Capital Stock Adjustments
1995
- ----
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1994............... $72 $66,319 $46,528 $(576) $ - $(861)
Add -Issuance of common stock:
NRC Merger................... 3 5,704 - - - -
CNN Acquisition.............. 5 11,295 - - - -
Public Offering.............. 16 36,926 - - - -
Coastal/Phibro Transaction... 3 7,497 - - - -
Other........................ - 4 - - - -
- Issuance of restricted stock. - 216 - - (216) -
- Amortization of restricted stock - - - - 57 -
- Net income for the year ended
December 31, 1995............ - - 11,325 - - -
- Net currency translation
adjustments.................. - - - - - (208)
Deduct - Public offering costs........ - (644) - - - -
- Dividends paid............... - - (1) - - -
-------- -------- ------- ----- ----- --------
Balance, December 31, 1995............... $99 $127,317 $57,852 $(576) $(159) $(1,069)
======== ======== ======= ===== ===== ========
1994
- ----
Balance, December 31, 1993............... $72 $66,319 $37,202 $(576) - $(2,484)
Add -Net income for the year
ended December 31, 1994...... - - 9,327 - - -
-Net currency translation
adjustments.................. - - - - - 1,623
Deduct -Dividends paid................ - - (1) - - -
--------- ------- ------- ------ ------ ---------
Balance, December 31, 1994............... $72 $66,319 $46,528 $(576) $ - $ (861)
========= ======= ======= ====== ====== =========
1993
- ----
Balance, December 31, 1992............... $71 $64,445 $28,094 $(576) $ - $(2,388)
Add -Issue of common stock to
acquire vessels.............. 1 1,874 - - - -
-Net income for the year ended
December 31, 1993............ - - 9,115 - - -
Deduct -Net currency translation
adjustments.................. - - - - - (96)
-Dividends paid................ - - (7) - - -
---------- ------- ------- ----- ----- ---------
Balance, December 31, 1993............... $72 $66,319 $37,202 $(576) $ - $(2,484)
========== ======= ======= ===== ===== =========
</TABLE>
The accompanying notes are an integral part of these financial statements and
should be read in conjunction herewith.
F-5<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
(IN THOUSANDS)
1995 1994 1993
-------- -------- ------
<S> <C> <C> <C>
Cash Flows from Operating Activities:
Net income............................................................... $11,325 $ 9,327 $ 9,115
Depreciation and amortization............................................ 18,842 14,108 12,107
Mobilization amortization................................................ 44 415 953
Restricted stock amortization............................................ 57 - -
Bad debt expense......................................................... 100 98 20
Debt discount amortization............................................... 277 309 97
Deferred income taxes.................................................... 335 (148) 1,341
Equity in net earnings of 50% or less owned companies.................... (872) (975) (287)
Extraordinary loss, extinguishment of debt............................... - - 1,093
Gain on purchase of 6% Convertible Subordinated Notes.................... (199) - -
(Gain)/loss from equipment sales or retirement........................... (3,850) 388 8
Minority interest in income (loss) of subsidiary......................... (321) (184) 51
Other ................................................................. 31 176 19
Changes in operating assets and liabilities:
Decrease in restricted cash.......................................... 308 87 293
(Increase) decrease in receivables................................... (14,807) (261) (4,040)
(Increase) in inventories............................................ (79) (255) (132)
(Increase) in prepaid expenses and other assets...................... (1,620) (236) (529)
Increase (decrease) in payables and accrued and other liabilities.... 368 (1,699) 3,307
------- ------- -------
Net cash provided by operations................................ 9,939 21,150 23,416
------- ------- -------
Cash Flows from Investing Activities:
Purchases of property and equipment...................................... (14,534) (3,371) (24,194)
Proceeds from the sale of marine vessels and equipment................... 7,522 450 32
Investment in and advances to 50% or less owned companies................ (916) (1,342) (89)
Principal payments on notes due from 50% or less owned companies......... 431 - -
Principal payments received under a sale-type lease...................... 117 - -
Cash acquired in NRC Merger.............................................. 2,176 - -
Acquisition of John E. Graham & Sons..................................... (73,463) - -
Purchase of investment securities........................................ (28) (592) -
------- ------- ------
Net cash (used in) investing activities.............................. (78,695) (4,855) (24,251)
------- ------- -------
Cash Flows from Financing Activities:
Payments of long-term debt and loans from stockholders................... (66,609) (10,888) (36,986)
Proceeds from issuance of long-term debt and loans from stockholders..... 87,283 3,175 -
Net proceeds from sale of common stock................................... 36,302 - -
Payment of initial public offering costs................................. - - (155)
Purchase of 6% Convertible Subordinated Notes............................ (1,980) - -
Debt issue loans costs, Den norske Bank A/S, revolving credit facility... (667) - -
Payment of debt extinguishment costs..................................... - - (519)
Payments on capital lease obligation..................................... (1,037) - -
Net proceeds from sale of 6% Convertible Subordinated Notes.............. - - 55,324
Payment of Dividends..................................................... (1) (1) (7)
------- ------- -------
Net cash provided by (used in) financing activities................ 53,291 (7,714) 17,657
------- ------- -------
Effects of Exchange Rate Changes on Cash and Cash Equivalents................ (81) 130 (80)
------- ------- -------
Net Increase (Decrease) in Cash and Cash Equivalents......................... (15,546) 8,711 16,742
Cash and Cash Equivalents, beginning of period............................... 44,332 35,621 18,879
------- ------- -------
Cash and Cash Equivalents, end of period..................................... $28,786 $44,332 $35,621
======= ======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements and
should be read in conjunction herewith.
F-6<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. NATURE OF OPERATIONS AND ACCOUNTING POLICIES:
SEACOR Holdings, Inc. ("SEACOR") and its subsidiaries (the "Company")
furnish vessel support in the offshore oil and gas exploration and production
industry and provide contractual oil spill response and related services to
companies who store, transport, produce, or handle petroleum and certain
non-petroleum oils as required by the Oil Pollution Act of 1990 ("OPA 90"). The
Company operates principally in the United States, offshore West Africa, the
North Sea and Mexico.
BASIS OF CONSOLIDATION
The consolidated financial statements include the accounts of SEACOR
and its subsidiaries including the McCall Affiliated Companies, see Note 19, all
of which are wholly owned by SEACOR, except for a 9% minority interest in a
subsidiary that owns 11 vessels and bareboat charters in one vessel which
operate in the North Sea and U.S. Gulf of Mexico. The equity method of
accounting is used by the Company when it has a 20% to 50% ownership interest in
the voting stock of other companies and the ability to exercise significant
influence over their operating and financial policies. The investments in 50% or
less owned companies are carried at cost, adjusted for the Company's equity in
their undistributed earnings. All significant intercompany accounts and
transactions between the Company and its majority and wholly owned subsidiaries
have been eliminated in consolidation.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
CASH AND TEMPORARY CASH INVESTMENTS-
For purposes of the Consolidated Statements of Cash Flows, cash
equivalents refer to securities with original maturities of three months or
less.
INVESTMENT SECURITIES-
The Company holds investments in U.S. Government debt securities. These
securities are accounted for as held-to-maturity securities; and, accordingly
are reflected at amortized cost, which approximates fair value at December 31,
1995 and 1994.
ACCOUNTS RECEIVABLE-
Customers of vessel support services are primarily major and large
independent oil and gas exploration and production companies; whereas, customers
of oil spill response services include tank vessel owner/operators, refiners,
terminals, exploration and production facilities and pipeline operators. The
Company's customers are granted credit on a short-term basis and related credit
risks are considered minimal.
INVENTORIES-
Inventories consist of vessel spare parts, fuel, and supplies that are
recorded at cost and charged to vessel expenses as consumed.
F-7
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. NATURE OF OPERATIONS AND ACCOUNTING POLICIES: (CONTINUED)
PROPERTY AND EQUIPMENT-
Property and equipment are recorded at historical cost and depreciated
over the estimated useful lives of the related assets. Depreciation is computed
on the straight line method for financial reporting purposes. Maintenance and
repair costs, including routine dry dock inspections on vessels in accordance
with maritime regulations, are charged to operating expense as incurred.
Expenditures that extend the useful life or improve the marketing and commercial
characteristics of vessels and major renewals or improvements to other
properties are capitalized.
Vessels and related equipment are depreciated over 20-25 years; all
other property and equipment are depreciated and amortized over two to ten
years.
OTHER ASSETS-
Other assets include the following for the years ended December 31,
1995 and 1994, in thousands of dollars:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Goodwill, net of accumulated amortization of $167 in 1995
(see Note 4 and 7).......................................................... $ 7,837 $ -
Sale-type lease (see Note 12)................................................. 2,543 -
Debt issue costs, net of accumulated amortization of
$558 in 1995 and $643 in 1994............................................... 2,214 1,994
Other......................................................................... 624 693
------- ---------
$13,218 $ 2,687
======= =========
</TABLE>
Goodwill reflects the excess of cost over the estimated fair value of
the net assets acquired upon the merger of NRC Holdings, Inc. ("NRC Holdings")
with and into a subsidiary of SEACOR (see Note 4) and the excess of the value of
SEACOR's common stock issued in connection with the cancellation of two
customers' options to acquire up to 40% of a subsidiaries' common stock over the
previously recorded carrying value of those options (see Note 7). Goodwill is
being amortized on a straight line basis over its estimated useful life of 20
years.
Deferred debt issue costs relate primarily to the Company's sale of 6%
Convertible Subordinated Notes ("6% Notes") in July 1993 and the establishment
of an $85,000,000 revolving credit loan facility (the "DnB Facility") with Den
norske Bank A/S ("DnB") in September 1995 at a cost of $667,000. Debt issue
costs are being amortized on a straight line basis over the life of the related
debt, ranging from five to ten years.
Combined deferred charge amortization expense was $729,000, $769,000
and $1,430,000 for the years ended December 31, 1995, 1994, and 1993. A
significant amount of previously deferred mobilization costs was amortized to
expense in 1993 but declined in 1994 and 1995. The Company's policy has been to
defer any significant costs to relocate vessels in association with long-term
charters (i.e., charters having a term of one year or more at inception) in
which the term charter rates are adequate to recover the mobilization expenses.
These deferred mobilization costs are typically amortized to expense over the
primary term of the related charter contracts.
F-8
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. NATURE OF OPERATIONS AND ACCOUNTING POLICIES: (CONTINUED)
INCOME TAXES-
Effective January 1, 1993, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 109, the financial accounting and reporting
standard for income taxes. This standard superseded SFAS No. 96 which had been
previously adopted by the Company. There was no significant effect on the
Company's financial condition or results of operations caused by the adoption of
the new standard.
Deferred income tax assets and liabilities have been provided in
recognition of the income tax effect attributable to the difference between
assets and liabilities reported in the tax return and financial statements.
Deferred tax assets or liabilities are provided using the enacted tax rates
expected to apply to taxable income in the periods in which the deferred tax
assets and liabilities are expected to be settled or realized.
FOREIGN CURRENCY TRANSLATION-
The assets, liabilities and results of operations of certain SEACOR
subsidiaries are measured using the currency of the primary foreign economic
environment within which they operate, their functional currency. For purpose of
consolidating these subsidiaries with SEACOR, the assets and liabilities of
these foreign operations are translated to U.S. dollars at currency exchange
rates as of the balance sheet date and for revenue and expenses at the weighted
average currency exchange rates during the applicable reporting periods.
Translation adjustments resulting from the process of translating these
subsidiaries; financial statements are included in stockholders equity.
Certain SEACOR subsidiaries also enter into transactions denominated in
currencies other than their functional currency. Changes in currency exchange
rates between the functional currency and the currency in which a transaction is
denominated is included in the determination of net income in the period in
which the currency exchange rates change. Foreign currency exchange gains or
losses included in determining net income have not been material.
REVENUE RECOGNITION-
The Company's marine transportation business earns revenue primarily
from time or bareboat charter of vessels to customers based upon daily rates of
hire. Rates of hire earned under time and bareboat charters vary substantially
in direct proportion to the operating expenses incurred in conjunction with each
type of charter. Typically, under time charter arrangements, the vessels'
operating expenses are the responsibility of the Company; whereas, under
bareboat charters, the vessels' operating expenses are paid by the charterer.
Vessel charters may range from several days to several years.
Environmental customers are charged retainer fees for ensuring by
contract the availability at predetermined rates of the Company's response
services and equipment. Retainer services include employing a staff to supervise
response to an oil spill emergency and maintaining specialized equipment,
including marine equipment, in a ready state for spill response as contemplated
by response plans filed by the Company's customers. Certain vessel owners pay in
advance a minimum annual retainer fee based upon the number and size of vessels
in each such owner's fleet and in some circumstances pay the Company additional
fees based upon the level of each vessel owner's voyage activity in the U.S. The
Company recognizes the greater of revenue earned by voyage activity or the
portion of the retainer earned in each accounting period. Certain other vessel
owners pay a fixed fee for the Company's retainer service and such fee is
recognized ratably throughout the year. Facility owners generally pay a
quarterly fee based on a formula that defines and measures petroleum products
transported to or processed at the facility. Some facility owners pay an annual
fixed fee and such fee is recognized ratably
F-9
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. NATURE OF OPERATIONS AND ACCOUNTING POLICIES: (CONTINUED)
throughout the year. Retainer agreements with vessel owners generally range from
one to three years while retainer arrangements with facility owners are as long
as seven years.
Spill response revenue is dependent on the magnitude of any one spill
response and the number of spill responses within a given fiscal year.
Consequently, spill response revenue can vary greatly between comparable
periods.
RELIANCE ON FOREIGN OPERATIONS-
For the years ended December 31, 1995, 1994, and 1993, approximately
31%, 33%, and 40%, respectively, of the Company's offshore marine revenues were
derived from foreign operations. The Company's foreign operations are subject to
various risks inherent in conducting business in foreign nations. These risks
include, among others, political instability, potential vessel seizure,
nationalization of assets, currency restrictions and exchange rate fluctuations,
import-export quotas and other forms of public and governmental regulations, all
of which are beyond the control of the Company. Although, historically, the
Company's operations have not been affected materially by such conditions or
events, if is not possible to predict whether any such conditions or events
might develop in the future. The occurrence of any one or more of such
conditions or events could have a material adverse effect on the Company's
financial condition and results of operations.
EARNINGS PER SHARE -
Earnings per common share assuming no dilution was computed based on
the weighted average number of common shares issued and outstanding during the
relevant periods. Shares issuable upon the exercise of stock options were
excluded from the computation since the effect of the assumed exercise thereof
was not material.
On July 1, 1993, the Company sold $57,500,000 principal amount 6%
Notes, and on December 17, 1993, the Company issued $4,750,000 principal amount
2.5% Convertible Subordinated Notes ("2.5% Notes"). Both note issues are
convertible into shares of the Company's common stock at any time prior to
maturity. The conversion rates for the 6% Notes and the 2.5% notes are 39.024
and 32.979 shares, respectively, per $1,000 principal amount of notes. In
February 1995, the company purchased $2,250,000 of the then outstanding
$57,500,000 principal amount of its 6% Notes in the open market.
Earnings per common share assuming full dilution was computed based on
the weighted average number of shares issued and outstanding plus the shares
that would be outstanding assuming the exercise of all stock options using the
treasury stock method and assuming all outstanding convertible subordinated
notes were converted to common stock. For computation purposes, income before
extraordinary item and net income were adjusted for the interest expense (net of
income tax) applicable to the convertible subordinated notes.
RECLASSIFICATIONS -
Certain reclassifications of prior year information have been made to
conform with the current year presentation.
NEW ACCOUNTING STANDARDS -
In 1995, Statement of Financial Accounting Standards No.
121-"Accounting for Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed of" was issued and require adoption by the Company in fiscal 1996.
Management believes that such adoption will not have a material effect on the
Company's financial statements taken as a whole.
F-10
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
1. NATURE OF OPERATIONS AND ACCOUNTING POLICIES: (CONTINUED)
Also in 1995, Statement of Financial Accounting Standards No.
123-"Accounting for Stock-Based Compensation" (the "Statement") was issued which
establishes, among other things, financial accounting and reporting standards
for stock-based employee compensation plans. Entities may either adopt a "fair
value based method" of accounting for an employee stock option as defined by the
Statement or may continue to use accounting methods as defined by the Statement
or may continue to use accounting methods as prescribed by APB opinion No.
25-"Accounting for Stock Issued to Employees." Entities electing to remain with
the accounting in APB Opinion No. 25 are required to make pro forma disclosures
of net income and earnings per share as if the fair value based method of
accounting defined in the Statement had been applied. The accounting
requirements of the Statement are effective for transactions entered into in
fiscal years that begin after December 15, 1995. The Company expects to continue
following APB Opinion No. 25 and make appropriate disclosures in the future in
accordance with the Statement.
2. FAIR VALUE OF FINANCIAL INSTRUMENTS:
The estimated fair value amounts of the Company's financial instruments
have been determined using available market information and appropriate
valuation methodologies. Considerable judgment was required in developing the
estimates of fair value, and accordingly, the estimates presented herein, in
thousands of dollars, are not necessarily indicative of the amounts realizable
in current market exchange.
<TABLE>
<CAPTION>
CARRYING FAIR
DECEMBER 31, 1995 AMOUNT VALUE
----------------- ------ -----
<S> <C> <C>
Assets:
Cash, temporary cash investments
and investment securities.................................. $29,407 $29,409
Notes receivable from 50% or less
owned companies.............................................. 2,902 2,902
Liabilities:
Long-term debt............................................... 110,555 112,493
Indebtedness to shareholders and a minority
shareholder of a subsidiary............................... 2,675 2,565
</TABLE>
The carrying values of cash and temporary cash investments and notes
receivable due from 50% or less owned companies are a reasonable estimate of
their fair value. The estimated value of the Company's long-term debt and
indebtedness to a minority shareholder of a subsidiary of the Company was
determined by discounting the future cash flows using market information as to
borrowing rates for debt of similar terms and maturity. Loans from shareholders
are generally advances made from shareholders. The Company believes it is not
practicable to estimate the fair market value of the loans.
3. POOLING ARRANGEMENTS:
On December 17, 1993, the Company entered into a pooling arrangement
(the "SEAFISH Pool"), effective January 1, 1994, with Champagne Nationale de
Navigation ("CNN"), a French corporation engaged in various sectors of the
marine shipping industry, which sold and leased back (bareboat chartered) from
the Company ten offshore towing supply vessels. Under the terms of the
arrangement, revenue and expenses of certain vessels owned and operated by the
Company and certain vessels owned or bareboat chartered and operated
F-11
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
3. POOLING ARRANGEMENTS: (CONTINUED)
by CNN were pooled and the net pool results were shared by both parties equally
after giving effect to certain preference payments. Pursuant to an agreement
under which the Company acquired additional vessels from CNN, the pooling
arrangement and lease back of ten vessels were terminated effective October 1,
1995, (see Note 5).
SEAFISH Ltd., a Bahamian corporation owned jointly by SEACOR and CNN,
was assigned the responsibility to coordinate the activities of all vessels in
the SEAFISH Pool. Immediately prior to terminating the SEAFISH Pool, the company
and CNN had 12 and 21 participating vessels, respectively, and at December 31,
1994, the respective count of participating vessels was 11 and 15. For a fee,
the Company provided management and accounting services to SEAFISH Ltd. For the
years ended December 31, 1995 and 1994, the effect on the Company's revenue from
its participation in the SEAFISH Pool was a reduction in revenue of $972,000 and
an increase in revenue of $337,000, respectively.
On January 1, 1995, the SEAVEC Pool commenced operations. The SEAVEC
Pool was formed to coordinate the marketing in the North Sea standby market of
eleven vessels owned by the Company and five vessels from Toisa Ltd., an
unrelated offshore marine transportation and services company. Under the pooling
arrangement, operating revenue is pooled and distributed to each company
pursuant to a formula derived from the class of vessels each company contributes
to the pool. For the year ended December 31, 1995, the effect on the Company's
revenue from its participation in the SEAVEC Pool was a reduction in revenue of
$313,000. Ten vessels owned by the Company were participating in the Pool at
December 31, 1995.
4. NRC MERGER:
On March 14, 1995, SEACOR acquired the remaining 57.1% of the
outstanding common stock of NRC Holdings that it did not already own through a
merger (the "NRC Merger") of NRC Holdings with and into CRN Holdings Inc.
("CRN"), a wholly owned subsidiary of SEACOR. Following the NRC Merger, the
financial condition, results of operations, and cash flows of the newly acquired
environmental subsidiaries, primarily operating through the National Response
Corporation ("NRC"), were reflected in the Company's consolidated financial
statements. Prior to March 14, 1995, the Company reported its equity interest in
NRC Holdings as an investment in 50% or less owned company that was accounted
for by the equity method.
CRN, the surviving corporation of the NRC Merger, primarily through its
wholly owned subsidiary, NRC, is engaged in the business of responding to marine
oil spills and planning for environmental emergencies. SEACOR issued 292,965
shares of its common stock pursuant to the transaction that were valued at
$5,707,000. The Company already owned 42.9% of NRC Holdings which was carried on
the Company's books at a value net of deferred taxes of $995,000. The purchase
method was used to account for this business combination. The excess of cost
over estimated fair value of the net assets acquired, including $138,000 in
direct costs incurred in conjunction with the transaction, of which $3,447,000
will be amortized over 20 years using the straight line method. The estimated
fair values of assets and liabilities of NRC Holdings at the date of the NRC
Merger are as follows, in thousands of dollars:
F-12
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. NRC MERGER: (CONTINUED)
CAPTION AMOUNT
------- ------
Current Assets......................................... $ 6,008
Property and Equipment................................. 21,219
Capitalized Lease...................................... 1,807
Other Assets........................................... 100
Goodwill............................................... 3,447
Deferred Income Taxes.................................. 404
Current Liabilities.................................... (5,741)
Capital Lease Obligations.............................. (1,577)
Bank Loan Payable...................................... (12,500)
Deferred Revenue....................................... (6,327)
---------
$ 6,840
---------
The following unaudited pro forma information has been prepared as if
the merger had occurred at the beginning of each of the periods presented, in
thousands of dollars, except per share data. This pro forma information has been
prepared for comparative purposes only and is not necessarily indicative of what
would have occurred had the merger taken place on the dates indicated, nor does
it purport to be indicative of the future operating results of the Company. The
results of NRC Holdings for the year ended December 31, 1994, were impacted
favorably by its involvement in a major oil spill response in San Juan, Puerto
Rico. As spill response revenue is dependent on the magnitude of any one spill
response and the number of spill responses in a given year, operating results
can vary greatly between periods. The favorable effect of the major spill
response and its effect on operating results in 1994 is not indicative of a
trend or of anticipated results in future periods.
<TABLE>
<CAPTION>
CAPTION 1995 1994
------- ---- ----
<S> <C> <C>
Revenues.......................................... $130,735 $134,056
Net Income........................................ $11,477 $10,073
Earnings Per Share-Assuming No Dilution........... $1.52 $1.36
</TABLE>
5. VESSEL ACQUISITIONS AND DISPOSITIONS:
GRAHAM ACQUISITION-
On September 15, 1995, the Company acquired substantially all the
assets of John E. Graham & Sons and certain of its affiliated companies
(collectively, "Graham") for $72,854,000 in cash (the "Graham Acquisition"). The
purchased assets included 127 marine vessels used to support the offshore oil
and gas exploration and production industry in the U.S. Gulf of Mexico, real
estate, capital equipment and inventory associated with the operation of these
vessels. The acquisition was financed with $74,000,000 of borrowings under a
revolving credit facility entered into with DnB. The difference between the
amount borrowed and paid to Graham to acquire the assets was used to defray debt
issue and acquisition costs, totaling $1,208,000. Acquisition costs, totaling
$609,000, have been allocated to the vessels acquired, and debt issue costs,
totaling $599,000, are included in Other Assets.
F-13
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
5. VESSEL ACQUISITIONS AND DISPOSITIONS: (CONTINUED)
CNN ACQUISITION-
On November 14, 1995, the Company acquired three towing supply vessels
from CNN and entered into an agreement to acquire two anchor handling towing
supply vessels and certain other vessel related assets for aggregate
consideration of $21,550,000. Of such consideration, $11,300,000 was paid for by
issuing 459,948 shares of SEACOR's common stock to CNN and $10,250,000 was paid
for in cash on December 14, 1995 when the two anchor handling towing supply
vessels were delivered to the Company (the "CNN Acquisition"). The Company
borrowed $11,000,000 from the DnB Facility to finance the cash portion of the
consideration and pay acquisition costs. Pursuant to the CNN Acquisition, the
Company and CNN agreed to (i) terminate CNN's bareboat charters covering ten
vessels owned by the Company, effective October 1, 1995, (ii) terminate the
SEAFISH Pooling arrangement, effective October 1, 1995, (iii) the Company's
bareboat charter, effective October 1, 1995, of one vessel owned by CNN with an
option to purchase, (iv) provide the Company a right of first refusal until
December 31, 1999, under which terms CNN shall not sell or transfer all or part
of its interest in any of three additional vessels owned by CNN, (v) SEACOR's
acquisition of 50% of the outstanding shares of FISH for a cost of $60,000,
effective January 1, 1996, (vi) CNN's sale to SEACOR of all CNN's right, title,
and interest in and to all of the shares owned by CNN in SEAFISH Ltd. for a
purchase price of $5,000, effective January 1, 1996, (vii) reimburse CNN for
certain costs associated with CNN's early termination of employment contracts
for officers and crews that worked aboard seven of the Company's vessels which
were previously bareboat chartered to CNN; at December 31, 1995, the Company
recorded a liability of $700,000 regarding these contract termination costs and
has included such cost in the purchase price of the five vessels acquired, and
(viii) permit Feronia International Shipping S.A. ("FISH"), a French corporation
in which the Company and CNN own a 50% interest, to manage, for a fee, the
Company's vessels operating offshore West Africa and in the Arabian Gulf and
certain other additional vessels owned by CNN.
VESSEL DISPOSITIONS-
During 1995, the Company sold four supply and six utility vessels that
resulted in the recognition of a pre-tax gain, totaling $4,124,000. The gain was
offset by a pre-tax loss of $359,000 from the retirement of certain previously
capitalized costs relating to a vessel which was withdrawn from standby safety
service in the North Sea and relocated to the U.S. Gulf of Mexico for well
stimulation service. A pre-tax loss of $316,000 was recorded in 1994 from the
retirement of certain previously capitalized costs that also related to a vessel
which was withdrawn from standby safety service in the North Sea and relocated
to the U.S. Gulf of Mexico for well stimulation service.
6. INVESTMENTS IN AND RECEIVABLES FROM 50% OR LESS OWNED COMPANIES:
Investments, carried at equity, consist of the following at December
31, 1995 and 1994:
<TABLE>
<CAPTION>
PERCENT
OWNED
------------------
COMPANY 1995 1994
------- ---- ----
<S> <C> <C>
SEAFISH Ltd.............................................. 50.0% 50.0%
NRC Holdings, Inc........................................ - 42.9%
Maritima Mexicana, S.A................................... 40.0% 40.0%
SEAMEX International, Ltd................................ 40.0% 40.0%
West Africa Offshore, Ltd................................ 40.0% 40.0%
</TABLE>
F-14
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
6. INVESTMENTS IN AND RECEIVABLES FROM 50% OR LESS OWNED COMPANIES: (CONTINUED)
Until October 1, 1995, SEAFISH Ltd. coordinated the activities of
certain vessels owned and operated by the Company and certain vessels owned or
bareboat chartered and operated by CNN that participated in a pooling
arrangement (see Note 3). For purposes of the pooling arrangement, SEAFISH Ltd.
acted as a custodian of cash balances relating to the Company's and CNN's pool
activities and recorded no revenues or expenses from the pooling arrangement.
Therefore, the net pool results were not included in equity in net earnings of
50 or less owned companies. Pursuant to the CNN Acquisition (see Note 5), SEACOR
and CNN have agreed to terminate the SEAFISH Pool and SEACOR has agreed to
acquire all of CNN's rights, title and interest in and to all of the shares
owned by CNN in SEAFISH Ltd. for a purchase price of $5,000, effective January
1, 1996.
On March 14, 1995, SEACOR acquired the remaining 57.1% of the
outstanding common stock of NRC Holdings that it did not already own through a
merger of NRC Holdings with and into CRN. Following the NRC Merger, the
financial condition, results of operations, and cash flows of the newly acquired
environmental subsidiaries, primarily operating through NRC, were reflected in
the Company's consolidated financial statements.
(see Note 4).
Until the NRC Merger on March 14, 1995, and during 1994 and 1993, the
Company earned operating revenue of $68,000, $347,000 and $174,000,
respectively, from NRC. The fees related primarily to capital improvements made
by the Company to an owned and operated vessel and certain other expenses
incurred in support of NRC's oil spill response activities. In 1994 and until
the NRC Merger in 1995, the Company also provided management services to NRC for
a fee. The amount previously recorded by the Company as its equity in the
earnings of NRC Holdings differed from its 42.9% pro rata share of the company's
book value primarily because of the effect of the warrants held by two principal
customers to purchase 40% of the common stock of NRC (see Note 7). Equity in
earnings of NRC Holdings, Inc. and its subsidiaries, net of applicable income
taxes, was $607,000, and $287,000 for the years ended December 31, 1994 and
1993, respectively.
During 1994, the Company and Transportation Maritima Mexicana S.A. de
C.V. ("TMM") completed their structuring of a joint venture to serve the Mexican
offshore market that began in December 1993 (the "TMM Joint Venture"). As part
of organizing the TMM Joint Venture, the Company: (i) invested $1,630,000
representing its share of the costs to acquire and improve three vessels, (ii)
invested $800,000 cash, and (iii) contributed one vessel from its fleet with an
agreed value of $1,350,000. A portion of the Company's initial investment in the
TMM Joint Venture was represented by unsecured notes receivable, totaling
$2,350,000. The Company recorded a deferred gain of $718,000 upon contributing
the vessel to the venture from its fleet which is being amortized to income over
the vessel's depreciable life. The TMM Joint Venture is comprised of two
corporations, Maritima Mexicana, S.A. and SEAMEX International, Ltd.
In March 1995, the Company sold an additional supply vessel to the TMM
Joint Venture for $1,700,000 in cash which resulted in the recognition of an
immediate gain of $473,000 and the deferral of a $315,000 gain. The deferred
gain is being amortized to income over the depreciable life of the vessel, and
the amount amortized to other income from this transaction and from the
contribution of a vessel upon establishment of the venture totaled $53,000 and
$10,000 for the years ended December 31, 1995 and 1994, respectively.
In 1995, the Company entered into a sale-type lease for one of its
vessels with the TMM Joint Venture. The lease expires in seven years and
contains options which permit the TMM Joint Venture to purchase the vessel at
various dates during the term of the lease. Unearned income and deferred gain
amortized to other income in connection with this lease for the year ended
December 31, 1995, totaled $387,000. Additionally in 1995, the Company advanced
the TMM Joint Venture $680,000 to acquire equipment in exchange for a note
receivable.
Principal and interest payments on the TMM Joint Venture notes are due
in quarterly installments which extend through 2000. The notes bear interest at
prime plus two percent, and earned interest income was $302,000 and $147,000 for
the years ended December 31, 1995 and 1994, respectively.
F-15
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
6. INVESTMENTS IN AND RECEIVABLES FROM 50% OR LESS OWNED COMPANIES: (CONTINUED)
During 1995 and 1994, the TMM Joint Venture chartered vessels and
utilized other services of the Company. Charter and other revenue earned by the
Company from this operation for the years ended December 31, 1995 and 1994 was
$369,000 and $624,000, respectively. The Company's equity in earnings of the TMM
Joint Venture, net of applicable income taxes, was $873,000 and $368,000 for the
years ended December 31, 1995 and 1994, respectively.
West Africa Offshore, Ltd. has been the Company's principal agent for
vessels operating offshore West Africa and is reimbursed for its operating
expenses. Pursuant to FISH expanding its vessel management responsibilities in
behalf of the Company, see discussion below, agency support of West Africa
Offshore, Ltd.
will be limited primarily to the Company's operations in Nigeria.
Pursuant to the CNN Acquisition (see Note 5), SEACOR acquired 50% of
the outstanding shares of FISH, a French corporation, for a cost of $60,000,
effective January 1, 1996. FISH has agreed to manage the Company's vessels
operating offshore West Africa and in the Arabian Gulf and certain other
additional vessels owned by CNN. The FISH management fee charged to general and
administrative expense for the year ended December 31, 1995 totaled $226,000.
The summarized financial information below represents an aggregation of
the Company's principal equity investees for the years ended December 31, in
thousands of dollars.
<TABLE>
<CAPTION>
CONDENSED INFORMATION 1995 1994
- --------------------- ---- ----
<S> <C> <C>
Current Assets.................................................... $ 6,282 $10,040
Noncurrent Assets................................................. 10,351 32,359
------- -------
Total Assets................................................. $16,633 $42,399
======= =======
Current Liabilities............................................... 3,460 24,653
Noncurrent Liabilities............................................ 4,941 7,244
------- --------
Total Liabilities............................................ $ 8,401 $31,897
======== =======
Revenues.......................................................... $ 8,840 $50,217
======== =======
Gross Profit...................................................... $ 4,990 $24,648
======== =======
Net Income........................................................ $ 3,304 $ 4,397
======== ========
</TABLE>
The amount of consolidated retained earnings that represents
undistributed earnings of 50% or less owned companies accounted for by the
equity method was $1,241,000 at December 31, 1995.
7. COASTAL AND PHIBRO AGREEMENT:
On October 27, 1995, SEACOR and its primary environmental subsidiary,
NRC, amended certain existing agreements with two of its customers, Coastal
Refining and Marketing, Inc. ("Coastal") and Phibro Energy USA, Inc. ("Phibro").
Those agreements provided, among other things, for a reduction in, and
subsequent elimination of, Coastal and Phibro's participating interest in
certain operating results, a reduction in their retainer fees, and an
elimination of certain options held by each of those customers to purchase up to
20% of the fully
F-16
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
7. COASTAL AND PHIBRO AGREEMENT: (CONTINUED)
diluted common stock of NRC. NRC will continue to provide one customer through
December 31, 2001 and the other customer through December 31, 1998 various oil
spill response services mandated by the OPA 90. In addition, Coastal's
agreements, among other things, called for SEACOR to issue them 311,357 shares
of its common stock (having a value at time of issuance of $7,500,000) in
exchange for the cancellation of their stock options in NRC. Phibro also agreed
to cancel a similar option in return for amendments to its agreement which
related primarily to the reduction of its retainer payments for OPA 90 services.
SEACOR has accounted for its share issuance as a repurchase of a minority
interest. The difference between the value of the common stock issued and the
previously recorded carrying value of certain deferred revenue, net of income
tax effect, which approximated 40% of NRC's net book value, totaled $4,558,000
and was recorded as goodwill (see Note 1).
8. INCOME TAXES:
Income (loss) before income taxes, minority interest, equity in net
earnings of 50% or less owned companies, and extraordinary item derived from the
United States and foreign operations for the years ended December 31, are as
follows, in thousands of dollars:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
United States................................ $18,318 $13,494 $14,534
Foreign...................................... (2,676) (958) 777
-------- --------- --------
$15,642 $12,536 $15,311
======= ======= =======
</TABLE>
The Company files a consolidated U.S. Federal tax return. Income tax
expense (benefit) consisted of the following components for the years ended
December 31, 1995, 1994 and 1993, in thousands of dollars:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Current:
State............................................ $ 111 $ 123 $ 115
Federal.......................................... 4,622 4,193 3,207
Foreign.......................................... 442 200 676
Deferred:
Federal.......................................... 859 (148) 1,359
Foreign.......................................... (524) - (18)
------- -------- -------
$ 5,510 $ 4,368 $ 5,339
======= ======== =======
</TABLE>
The following table reconciles the difference between the statutory
federal income tax rate for the Company to the effective income tax rate:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Statutory Rate................................... 34.0% 34.0% 34.0%
Foreign and state taxes.......................... 1.2 0.8 0.9
------ -------- -------
35.2% 34.8% 34.9%
</TABLE>
F-17<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
8. INCOME TAXES: (CONTINUED)
The components of the net deferred income tax liability were as
follows, for the years ended December 31, in thousands of dollars:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Deferred tax assets:
Foreign Tax Credit........................................ $ 522 $ 337
Alternative Minimum Tax Credit............................ 568 -
Subpart F Loss............................................ 1,727 747
Nondeductible Accruals.................................... 494 -
Other .................................................... 367 340
Total deferred tax assets.............................. 3,678 1,424
Deferred tax liabilities:
Property and equipment.................................... 39,102 34,717
Investment in Subsidiaries................................ 603 660
Other .................................................... 655 919
--------- ----------
Total deferred tax liabilities......................... 40,360 36,296
--------- ----------
Net deferred tax liabilities........................ $ 36,682 $ 34,872
========= ==========
</TABLE>
As of December 31, 1995, the Company has carryforwards for income tax
purposes of foreign tax credits approximating $522,000 that expire from 1997
through 2000. As of December 31, 1995, the Company also has alternative minimum
tax credit carryforwards of $568,000 for income tax purposes. For financial
reporting purposes, the carryforwards have been recognized through a reduction
in deferred tax liabilities.
9. RELATED PARTY TRANSACTIONS:
The Company reimburses a stockholder for management and administrative
services. These charges totaled $275,000 for the year ended December 31, 1995
and $175,000 for each of the years ended December 31, 1994 and 1993. The fees
relate primarily to the use of the stockholder's physical resources and
administrative and technical personnel.
Miller Environmental Group ("MEG"), an environmental contractor based
in Calverton, New York, maintains and stores spill response equipment owned by
NRC and in the event of a spill, provides labor, equipment and materials to
assist in NRC's spill response activities. In fiscal 1995, NRC paid
approximately $1,750,000 to MEG for these services. The father of a SEACOR
corporate officer is Vice President, Secretary and Treasurer of MEG.
NRC also contracts with James Miller Marine Services ("JMMS"), an
environmental contractor based in Staten Island, New York, for services similar
to those provided by MEG. In fiscal 1995, NRC paid approximately $600,000 to
JMMS for these services. The brother of a SEACOR corporate officer is Vice
President of JMMS.
Loans from stockholders are made up of unsecured loans due to Norman
and Joyce McCall. The loans are due on demand and bear interest at 7% per annum
at December 31, 1995. On May 3, 1996, the loans were paid in full.
F-18
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
10. LONG-TERM DEBT:
Long-term debt balances, maturities, and interest rates are as follows
for the years ended December 31, in thousands of dollars:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Notespayable to former vessel owners, due in quarterly or semi-annual
installments and maturing from 1996 through 2003, at interest
rates ranging from 3.75% to 7.50%................................. $ 11,147 $ 13,210
Notes payable to banks, due in monthly
installments and maturing from 1995 through
2007, secured by vessels (9.75% at December 31,
1995)............................................................. 1,596 1,293
Notespayable to Nederlandse Scheepshypotheekbank N.V. ("Nedship Bank"),
due in quarterly installments payable from 1991 through 1996,
secured by vessels, bearing interest at LIBOR
plus 2.0% (7.375% at December 31, 1994)........................... - 5,227
DnB Revolving Credit Facility, interest payable
based upon interest option period at LIBOR plus 1.25% prior to term
conversion and principal and interest after conversion on August 31, 1996
due semi-annually through August 31, 2002 bearing interest at LIBOR plus
maximum of 1.5% (7.1875% at December 31,
1995)............................................................. 40,000 -
6% Convertible Subordinated Notes, due 2003,
interest payable semi-annually commencing 1994.................... 55,250 57,500
2.5% Convertible Subordinated Notes, due 2004,
interest payable semi-annually commencing 1994.................... 4,750 4,750
----------- ----------
112,743 81,980
Less - Portion due within one year..................................... (2,489) (5,896)
- Debt discount................................................. (2,188) (2,463)
----------- ----------
$ 108,066 $ 73,621
=========== ==========
</TABLE>
Annual maturities of long-term debt for the five years following
December 31, 1995, are as follows, in thousands of dollars.
YEAR 1996 1997 1998 1999 2000
- ---- ---- ---- ---- ---- ----
AMOUNT....... $ 2,489 $ 1,632 $ 1,494 $ 1,356 $ 1,356
The long-term debt maturities schedule does not include future annual
maturities for borrowings outstanding under the DnB Facility at December 31,
1995. It is uncertain how much, if any, of the outstanding senior secured
revolving bridge loans due DnB at December 31, 1995 may be converted into term
loans on August 31, 1996, the date upon which the Company may elect to extend
all or a portion of the DnB Facility. If the outstanding senior secured
revolving bridge loans at December 31, 1995 were converted to term loans and the
F-19
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
10. LONG-TERM DEBT: (CONTINUED)
Company did not extend its commitment for any other unused portion of the DnB
Facility on August 31, 1996, future annual maturities for the DnB Facility would
be $6,667,000 in each of the years 1997 through 2000 and $13,332,000 thereafter.
On August 20, 1993, the Company retired U.S. Government Guaranteed Ship
Financing Bonds in the amount of $7,303,000 with proceeds from the issuance of
the 6% Notes. At that time, $549,000 and $52,000 of unamortized debt discount
and deferred bond issue costs, respectively, were written off, and a redemption
premium and fees of $341,000 were paid, all of which was recorded as an
extraordinary loss. Debt discount amortization expense related to these bonds
was $66,000 for the year ended December 31, 1993.
In July 1993, the Company retired notes payable to a bank and former
vessel owners in the amount of $18,110,000 with proceeds from the issuance of
the 6% Notes. At that time, $1,011,000 of unamortized deferred debt issue costs
was written off, and fees of $178,000 were paid to the bank, all of which was
recorded as an extraordinary loss.
In April 1991, in conjunction with the Company's expansion in the North
Sea, VEESEA Holdings, Inc. ("VEESEA"), a 91% owned subsidiary of SEACOR, and its
subsidiaries (collectively, the "VEESEA Group") entered into a loan agreement
with Nedship Bank, pursuant to which Nedship Bank loaned pounds sterling
10,700,000 (or $18,426,000 based upon exchange rates in 1991). In conjunction
with regularly scheduled payments during 1995, the Company made optional
principal prepayments, amounting to $2,266,000, on the Nedship Bank loan, and
the loan was completely repaid by December 31, 1995.
In conjunction with eight vessels acquired in March 1993, SEACOR issued
two notes payable to the former vessel owners: (i) a $1,875,000, 7.5% unsecured
note repayable in eleven equal quarterly installments of $100,000 commencing
June 1993 with a final installment of $775,000 in March 1996, and (ii) a
$975,000, 6% unsecured note repayable in twelve quarterly installments of
$81,250 commencing June 1993 and maturing March 1996.
On August 6, 1993, a customer who had previously sold a project vessel
to the Company for a promissory note confirmed a decision to terminate a
long-term charter of that vessel. Pursuant to this transaction, the customer
forgave $450,000 in principal amount of the note payable due from the Company
under a first preferred mortgage on vessels which had a net book value of
$4,222,000 at December 31, 1995, made other adjustments to the mortgage, and
paid the Company a demobilization fee of $235,000. The forgiveness of the note
was recorded as an extraordinary gain, and the demobilization fee was included
in income before extraordinary item.
On July 1, 1993, SEACOR sold $57,500,000 principal amount of 6% Notes.
The agreements under which the 6% Notes were issued provided for underwritten
resales to qualified institutional buyers and to non-U.S. purchasers in
transactions exempt from registration under applicable securities laws. The 6%
Notes are convertible into shares of SEACOR's Common Stock at any time prior to
July 1, 2003, at a conversion rate of 39,024 shares per $1,000 principal amount
of the 6% Notes. There is no sinking fund for the 6% Notes; however, the 6%
Notes are redeemable, in whole or in part, at the election of SEACOR any time on
or after July 1, 1996, initially at 104.2% of the principal amount thereof and
declining by 0.67% each year thereafter to 100% of the principal amount in 2003.
In addition, upon the occurrence of a change in control of SEACOR (as defined in
the indenture of the 6% Notes), holders of the 6% Notes may elect to require
SEACOR to purchase their 6% Notes, in whole or in part, at a purchase price
equal to 100% of the principal amount thereof, plus accrued interest to the date
of purchase. SEACOR incurred $2,176,000 in costs associated with the sale of the
6% Notes including
F-20
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
10. LONG-TERM DEBT: (CONTINUED)
$1,869,000 of the underwriters discount. These debt issue costs were charged to
other assets and are being amortized to expense over ten years.
In February 1995, the Company purchased $2,250,000 of the then
outstanding $57,500,000 principal amount of its 6% Notes in the open market. The
difference between the amount paid to acquire the 6% Notes and their carrying
value resulted in the Company recognizing a gain of $199,000, net after giving
effect to a write-off of $71,000 in unamortized deferred debt issue costs
associated with the sale of the 6% Notes. The gain is included in other income.
In December 1993, the Company financed, in part, the acquisition of ten
offshore towing supply vessels from CNN with: (i) $12,000,000 principal amount
senior unsecured notes payable having varying maturities of one to ten years,
bearing interest rates ranging from 3.25% to 5.50% per annum and which have been
guaranteed by SEACOR, and (ii) $4,750,000 principal amount of 2.5% Notes. The
2.5% Notes are convertible into shares of SEACOR's Common Stock at any time
prior to maturity at a conversion rate of 32.979 shares per $1,000 principal
amount of the 2.5% Notes. There is no sinking fund for the 2.5% Notes; however,
the 2.5% Notes are redeemable, in whole or in part, at the election of SEACOR
any time on or after July 1, 1997, initially at 104.2% of the principal amount
thereof and declining by 0.60% each year thereafter to 100% of the principal
amount after July 1, 2003. In addition, upon the occurrence of a change in
control of SEACOR (as defined in the indenture of the 2.5% Notes), holders of
the 2.5% Notes may elect to require SEACOR to purchase their 2.5% Notes, in
whole or in part, at a purchase price equal to 100% of the principal amount
thereof, plus accrued interest to the date of purchase. The stated interest
rates on the unsecured notes and the 2.5% Notes (collectively, the "Notes") were
considered lower than interest rates at which the Company would normally obtain
similar financing which were determined to range from 5.10% to 9.14%. The Notes
were valued based on discounting concepts to approximate their fair market
value. The difference between the Notes' fair market and stated values at
inception, $2,749,000, was recorded as debt discount and as a reduction in the
carrying value of the vessels acquired. Amortized debt discount included in
interest expense was $277,000 and $309,000 for the years ended December 31, 1995
and 1994, respectively.
Certain of SEACOR's subsidiaries (the "borrowing subsidiaries") are
parties to the DnB Facility, with DnB as lender and SEACOR as guarantor.
Pursuant to the DnB Facility, the borrowing subsidiaries may borrow up to
$85,000,000 aggregate principal amount of senior secured revolving bridge loans
any time prior to August 31, 1996 (the "Initial Term"). At the Company's
election, such loans, on or prior to August 31, 1996, may be converted into
senior secured reducing revolving credit loans maturing on August 31, 2003.
Until termination of the DnB Facility, a commitment fee is payable to DnB on a
quarterly basis, computed at the rate of one-half of one percent per annum on
the average unfunded portion of the credit facility.
During the Initial Term of the DnB Facility, outstanding borrowings
bear interest at an annual rate equal to 125 basis points above LIBOR. If the
Borrowing Subsidiaries elect to convert the senior secured bridge loans to
senior secured reducing revolving credit loans (the "Term Loans"), the Maximum
Committed Amount automatically will decrease semi-annually by certain
percentages described in the DnB Facility. The DnB Facility requires the
Company, on a consolidated basis, to maintain a minimum ratio of indebtedness to
vessel value, as defined, a minimum cash and cash equivalent level, and a
specified debt service coverage ratio. The Company also is prohibited from
entering into additional indebtedness above a certain level without consent.
Furthermore, SEACOR, without prior written consent of DnB, is prohibited through
August 31, 1996 (the maturity date of the bridge loan portion of the DnB
Facility) from paying dividends to its shareholders. Pursuant to the DnB
Facility, the Term Loans would bear interest at the annual rate equal to a
maximum of 150 basis points above LIBOR.
F-21
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
10. LONG-TERM DEBT: (CONTINUED)
Borrowings outstanding pursuant to the DnB Facility are secured by,
among other things, a guaranty of SEACOR of the obligations of the Borrowing
Subsidiaries, first preferred mortgages on vessels owned by the Borrowing
Subsidiaries which had a net book value of $72,980,000 at December 31, 1995, a
negative pledge relating to certain vessels, and an assignment of earnings and
certain contract rights with respect to vessels owned and operated by the
Borrowing Subsidiaries. If the Borrowing Subsidiaries exercise the
aforementioned conversion election, certain additional subsidiaries of the
Company will be required to guaranty the obligations of the Borrowing
Subsidiaries under the DnB Facility and provide mortgages on additional vessels
to secure such guaranty.
On September 15, 1995, $74,000,000 principal amount was borrowed under
the DnB Facility to finance the acquisition of offshore marine service vessels
and other related assets pursuant to the Graham Acquisition and to pay related
debt issue and acquisition costs. On November 14, 1995, the Company repaid
$14,000,000 principal amount of the indebtedness from existing cash balances. On
December 14, 1995, the Company borrowed an additional $11,000,000 under the DnB
Facility to finance the cash portion of the CNN Acquisition and pay related
acquisition costs. On December 21, 1995, the Company repaid $31,000,000
principal amount of the indebtedness with proceeds from the sale of common
stock, and an additional $5,000,000 principal amount was repaid subsequent to
year end.
Following the NRC Merger in March 1995, the Company repaid the
remaining outstanding principal balance, $12,500,000, under a Credit Agreement
between NRC and CIBC Inc., as amended.
11. EXTRAORDINARY ITEM:
In 1993, the Company recognized a net extraordinary loss caused by debt
extinguishment of $1,093,000 ($0.19 per share), net of a $588,000 income tax
benefit. Of the extraordinary loss, $1,385,000 was caused by the write-off of
unamortized debt discount, bond issue and debt issue costs, and the payment of
redemption premiums and fees relating to the retirement of outstanding
indebtedness due U.S. Government Guaranteed Ship Financing Bond holders, note
holders and a bank. The redemption premiums, fees, and indebtedness were paid
with the net proceeds from the Company's sale of 6% Notes. The extraordinary
loss was reduced by a $292,000 gain recognized upon the forgiveness of
indebtedness associated with the termination of a vessel charter.
12. LEASES:
From December 1993 through September 30, 1995, the Company was the
lessor of ten offshore towing supply vessels under bareboat charter agreements
with CNN. Pursuant to the CNN Acquisition, the Company and CNN agreed to
terminate CNN's bareboat charter of these vessels. Operating revenue earned from
the bareboat charter of these vessels totaled $3,795,000, $5,074,000 and
$350,000 for the years ended December 31, 1995, 1994, and 1993, respectively.
In 1995, the Company entered into a sale-type lease with the TMM Joint
Venture for one anchor handling towing supply vessel. The lease expires in seven
years and contains options which permit the TMM Joint Venture to purchase the
vessel at various dates during the term of the lease. Unearned income and
deferred gain amortized to other income for the year ended December 31, 1995,
totaled $387,000. The following lists the components of
F-22
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
12. LEASES: (CONTINUED)
the net investment in the sale-type lease as of December 31, of which $183,000
and $2,543,000 are reported in current and noncurrent other assets,
respectively, in thousands of dollars:
<TABLE>
<CAPTION>
1995
----
<S> <C>
Minimum lease payments receivable........................................ $ 4,161
Estimated residual value of leased property.............................. 781
Less: Unearned income.................................................... (2,216)
---------
Net investment in sale-type lease........................................ $ 2,726
=========
</TABLE>
Minimum rental receivables due from sale-type leases are $667,000 in
each of the fiscal years ended December 31, 1996 through 2001 and $159,000 due
in 2002.
The Company is the lessee under a capital lease for offshore oil boom
that is used in conjunction with its oil spill response activities. The offshore
boom, with gross cost and accumulated depreciation of $1,807,000 and $269,000,
respectively at December 31, 1995, is being depreciated over an estimated useful
life of seven years. Included in current and noncurrent liabilities,
respectively, at December 31, 1995 are $172,000 and $368,000 of obligations
under capital leases. The following is a schedule of future minimum lease
payments due under a capital lease together with the present value of the net
minimum lease payments as of December 31, in thousands of dollars:
<TABLE>
<CAPTION>
1995
----
<S> <C>
1996..................................................................... $ 300
1997..................................................................... 450
------
Total minimum lease payments............................................. 750
Less: amount representing interest....................................... 210
------
Present value of minimum lease payments.................................. $ 540
======
</TABLE>
13. MAJOR CUSTOMERS AND SEGMENT DATA:
Two customers accounted for approximately 16% and 10%, respectively, of
revenues in the year ended December 31, 1995; two customers accounted for
approximately 19% and 15%, respectively, of revenues in the year ended December
31, 1994; and three customers accounted for approximately 18%, 12% and 10%,
respectively, of revenues in the year ended December 31, 1993.
Operations are conducted through two business segments, offshore vessel
and environmental services. On March 14, 1995, the remaining outstanding stock
that the Company did not already own, in corporations now comprising the
Company's environmental segment, was acquired, and from that date forward, the
Company has reflected the financial condition and results of operations of those
environmental subsidiaries in its consolidated financial statements. Prior to
March 14, 1995, the Company reported its interest in the environmental
subsidiaries as an investment in 50% or less owned companies which were
accounted for under the equity method. The Company's offshore service vessel
segment operates in different geographical areas; whereas, the environmental
F-23
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
13. MAJOR CUSTOMERS AND SEGMENT DATA: (CONTINUED)
segment's primary operations are in the United States. Information by business
segment and geographical area is as follows for the years ended December 31, in
thousands of dollars:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
OPERATING REVENUE:
MARINE-(a)
<S> <C> <C> <C>
United States.......................................... $ 72,964 $ 63,283 $ 54,864
North Sea.............................................. 13,523 16,222 20,007
West Africa............................................ 14,637 10,189 12,374
Other Foreign.......................................... 3,770 4,291 4,923
---------- ---------- ----------
104,894 93,985 92,168
ENVIRONMENTAL............................................... 21,765 - -
---------- ---------- ----------
$ 126,659 $ 93,985 $ 92,168
========== ========== ==========
OPERATING PROFIT
MARINE-(a)
United States.......................................... $ 17,529 $ 14,040 $ 14,598
North Sea.............................................. (2,952) 7 3,085
West Africa............................................ 3,840 2,582 1,683
Other Foreign.......................................... 1,843 1,667 1,816
---------- ---------- ----------
20,060 18,296 21,182
ENVIRONMENTAL............................................... 1,626 - -
---------- ---------- ----------
21,886 18,296 21,182
Other income (expense) (c).................................. 190 (73) 116
General corporate administration............................ (2,123) (2,139) (2,268)
Net interest expense........................................ (4,311) (3,548) (3,719)
Minority interest in loss (income) of a subsidiary.......... 321 184 (51)
Equity in earnings of 50% or less owned companies........... 872 975 287
Income tax expense.......................................... (5,510) (4,368) (5,339)
---------- ---------- ----------
Income before extraordinary item............................ $ 11,325 $ 9,327 $ 10,208
========== ========== ==========
IDENTIFIABLE ASSETS:
MARINE-
United States (c)...................................... $ 208,424 $ 140,185 $ 109,317
North Sea.............................................. 24,105 32,004 36,860
West Africa (e)........................................ 69,022 41,476 29,428
Other Foreign (b)...................................... 9,850 15,093 42,009
---------- ---------- ----------
311,401 228,758 217,614
ENVIRONMENTAL............................................... 32,652 - -
CORPORATE (d)............................................... 7,132 9,387 839
---------- ---------- ----------
$ 351,185 $ 238,145 $ 218,453
========== ========== ==========
PROVISION FOR DEPRECIATION AND AMORTIZATION:
MARINE-
United States (c)...................................... $ 8,623 $ 7,304 $ 6,575
North Sea.............................................. 3,621 3,490 3,522
West Africa (e)........................................ 2,931 2,151 1,220
Other Foreign (d)...................................... 664 976 692
---------- ---------- ----------
15,839 13,921 12,009
ENVIRONMENTAL 2,875 - -
CORPORATE (d) 128 187 98
---------- ---------- ----------
$ 18,842 $ 14,108 $ 12,107
========== ========== ==========
F-24
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
13. MAJOR CUSTOMERS AND SEGMENT DATA: (CONTINUED)
CAPITAL EXPENDITURES:
MARINE-
United States.......................................... $ 75,782 $ 2,852 $ 7,900
North Sea.............................................. 45 225 1,934
West Africa............................................ 21,722 70 1,020
Other Foreign.......................................... 38 18 32,163
---------- ---------- ----------
97,587 3,165 43,017
========== ========== ==========
ENVIRONMENTAL 688 - -
CORPORATE 75 206 14
---------- ---------- ----------
$ 98,350 $ 3,371 $ 43,031
========== ========== ==========
<FN>
- --------------------
(a) "West Africa" and "Other Foreign" include the results of vessels
bareboat chartered-out to CNN from December 1993 through September
1995, at which time the bareboat charters were canceled and the Company
resumed operation of the vessels.
(b) In 1993, identifiable assets include vessels acquired from CNN that
operated only during December.
(c) Other income (expense) excludes gain/(loss) from equipment sales or
retirements of property and certain other expenses that were
reclassified to operating profit in geographical areas of the Marine
segment.
(d) The Company's corporate assets include investments in 50% or less owned
companies.
(e) In 1995, identifiable assets include the effect of the Graham and CNN
Acquisitions.
</FN>
</TABLE>
14. COMMON STOCK:
In March 1993, SEACOR issued 125,000 shares of common stock at $15.00
per share or $1,875,000 pursuant to the acquisition of seven supply vessels.
On March 14, 1995, pursuant to the NRC Merger, SEACOR acquired the
remaining 57.1% of the outstanding common stock of NRC Holdings that it did not
already own through a merger of NRC Holdings with and into CRN. SEACOR issued
292,965 shares of its common stock pursuant to the transaction that was valued
at $5,707,000.
On October 27, 1995, SEACOR and its primary environmental subsidiary,
NRC, amended certain existing agreements with Coastal. Those agreements, among
other things, eliminated certain options held by Coastal to purchase up to 20%
of the fully diluted common stock of NRC. SEACOR issued 311,357 shares of common
stock, having a value at time of issuance of $7,500,000, in exchange for the
cancellation of Coastal's stock options in NRC.
On November 4, 1995, pursuant to the CNN Acquisition, SEACOR issued
59,948 shares of common stock that was valued at $11,300,000 at the date of
issuance to acquire three towing supply vessels.
In December 1995, SEACOR completed a public offering of its common
stock that resulted in the sale of 1,612,500 shares. The proceeds received from
this sale, net of underwriting discount, totaled $36,942,000. The Company
incurred $644,000 in expenses associated with this stock offering (other than
underwriting discount) which was charged against additional paid-in capital
arising from the sale. The public offering included 1,550,000 shares of common
stock sold by several of SEACOR's stockholders.
F-25
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
15. MINORITY INTEREST:
In December 1991, the managing agent of the Company's vessels operating
the North Sea invested approximately $1,278,000 of cash in VEESEA. In return for
this investment and for services rendered to the VEESEA Group, which were
included in mobilization expenses, the agent received 9% of the equity of
VEESEA, and SEACOR, through another subsidiary, assigned to the agent a $679,000
participation in debt due to the SEACOR subsidiary from the VEESEA Group. The
obligation due the agent, including accrued interest at 12% per annum, was
subordinated to the Nedship Bank loans to the VEESEA Group and is reported in
the consolidated balance sheet as other noncurrent liabilities.
A fee is paid the minority stockholder for managing the Company's
vessels in the North Sea. The U.S. dollar equivalent of fees paid in pounds
sterling under this arrangement approximated $960,000 in each of the years ended
December 31, 1995, 1994, and 1993.
16. BENEFIT PLANS:
NON-QUALIFIED STOCK OPTION PLAN-
SEACOR's 1992 Non-Qualified Stock Option Plan (the "Plan") provides for
the grant of non-qualified options to purchase shares of common stock to
officers and key employees of the Company. Under the Plan, 500,000 shares of
common stock have been reserved for sale. The exercise price per share of
options granted under the Plan cannot be less than 75% or greater than 100% of
the "Fair Market Value" (as defined in the Plan) of one share of common stock on
the date of the grant.
Options granted under the Plan expire no later than the tenth
anniversary of the date of grant. Recipients of options must remain employed for
at least two years from date of grant before options become exercisable, subject
to the earlier exercise under certain circumstances. The exercise price per
share of each option may be paid in cash, shares of common stock owned by the
grantee in a combination of cash and common stock or by delivery of a promissory
note not to exceed 90% of the total exercise price.
The following transactions occurred in the stock option plan during the
years ended December 31:
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Options outstanding, at beginning of year...................... 309,250 266,750 50,000
Options granted................................................ 117,747 42,500 267,500
Options exercised.............................................. - - -
Options canceled............................................... (1,800) - (50,750)
------- ------- -------
Options outstanding, at end of year............................ 425,197 309,250 266,750
======= ======= =======
Price range of options exercised............................... $ - $ - $ -
Price range of options outstanding, end of year................ $9.64-21.25 $14.75-21.25 $14.75-21.00
</TABLE>
At December 31, 1995, 74,803 shares were available for future grant and
264,950 options were exercisable. At December 31, 1994 and 1993, there were no
exercisable options.
F-26
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. BENEFIT PLANS: (CONTINUED)
On March 14, 1995, the Executive Compensation and Stock Option
Committee of the Board of Directors granted two officers of SEACOR and three key
employees of NRC options to purchase a total of 102,192 shares of common stock
of SEACOR at an exercise price of $18.75 per share. Furthermore, as part of the
NRC Merger, the Company assumed the obligations of the NRC Holdings 1994
Non-Qualified Stock Option Plan. As a result, the Company converted existing
options for shares of NRC Holdings into options for 15,555 shares of SEACOR's
common stock at an exercise price of $9.64 per share. The exercise price per
share for options issued or converted in 1995 equaled the market price at the
original dates the options were granted.
SEACOR SAVINGS PLAN-
The Company established the SEACOR Savings Plan ("SEACOR Plan"),
effective July 1, 1994. This defined contribution plan provides eligible
employees with an opportunity to accumulate retirement savings. Requirements for
eligibility include, (i) one year of full time employment, (ii) attainment of 21
years of age, and (iii) residency in the United States.
Participants may contribute up to 15% of their pre-tax annual
compensation. During 1995 and 1994, the Company matched 50% up to the first 4%
of an employee's contribution to the SEACOR Plan, and the Board of Directors of
the Company determine the Company's matching contribution annually. The
participant's and Company's contributions are funded to the SEACOR Plan monthly.
Participants are fully vested in the Company's contribution upon (i)
attaining the age of 65, (ii) death, (iii) becoming disabled, or (iv) completing
five years of employment service. Forfeitures of Company contributions for
non-vested and terminated employees will be used to reduce future contributions
of the Company or pay administrative expenses of the SEACOR Plan.
In connection with the NRC Merger, the Company assumed the obligations
of a tax-deferred savings plan that was implemented by NRC in 1993. Under the
terms of the NRC Plan, eligible employees can elect to contribute up to 15% of
their compensation, and NRC matches 100% up to the first 3% of the employee's
contribution.
In connection with the McCall acquisition, the Company assumed the
obligations of a defined contribution plan that was implemented by McCall in
1995. Under the terms of the McCall plan, eligible employees can elect to
contribute up to 15% of their compensation. During 1995, McCall matched 1/3 of
the first 6% of an employee's contribution to the plan. The Board of Directors
of McCall determine the matching contribution annually.
The combined Companies' contributions to the plans were $215,000 and
$51,000 for the years ended December 31, 1995 and 1994, respectively.
EMPLOYEE RESTRICTED STOCK AWARD-
On March 14, 1995, in recognition of an executive officer's commitment
to the continued growth and financial success of the Company, the executive
officer was granted 11,500 restricted shares of SEACOR's common stock. The
market value of the restricted shares was $216,000 at time of grant and was
recorded as unamortized restricted stock compensation in a separate component of
stockholders' equity. This compensation will be amortized to expense over a
three year vesting period. Notwithstanding the forgoing, 100% beneficial
F-27
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. BENEFIT PLANS: (CONTINUED)
ownership of the restricted stock shall vest immediately upon death, disability,
termination of the employee without "cause" or the occurrence of a "change in
control" of the Company.
17. QUARTERLY FINANCIAL INFORMATION (UNAUDITED):
<TABLE>
<CAPTION>
QUARTER ENDED
-------------
DEC 31 SEPT. 30 JUNE 30 MARCH 31
------ -------- ------- --------
(THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNT)
<S> <C> <C> <C> <C>
1995
Revenue....................................................... $44,550 $36,422 $25,504 $20,183
Gross Profit.................................................. 13,039 7,886 5,077 3,387
Net income.................................................... 5,334 2,144 2,310 1,537
Earnings per common share; Assuming no dilution............... 0.66 0.29 0.31 0.21
Assuming full dilution........................................ 0.56 0.28 0.29 0.22
</TABLE>
18. SUPPLEMENTAL INFORMATION FOR STATEMENTS OF CASH FLOWS:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Cash income taxes paid............................................................ $4,942 $4,300 $3,619
Cash interest paid................................................................ 6,132 6,773 3,209
Schedule of Non-Cash Investing and Financing Activities:
Property exchanged for investment in and notes receivable
from 50% or less owned company......................................... - 2,045 -
Joint venture investment increase related to deferred gain........................ 315 718 -
Common stock issued in exchange for stock options in NRC.......................... 7,500 - -
Purchase of vessels with-long-term notes, net of discount......................... - - 13,185
-common stock............................................................ 11,300 - 1,875
-2.5% notes, net of discount............................................. - - 3,665
-accounts receivable..................................................... - - 112
</TABLE>
<PAGE>
19. SUBSEQUENT EVENTS:
Effective May 31, 1996, the Company acquired the McCall Affiliated
Companies ("McCall") in exchange for 1,306,550 shares of the Company's common
stock. The acquisition was accounted for as a pooling of interests; accordingly,
prior period financial information has been restated to include this
acquisition. On December 31, 1995, McCall had $37,882,000 of assets. Selected
separate and combined financial information of the Company and McCall for the
years ended December 31, 1995, 1994 and 1993 is presented below (in thousands).
<TABLE>
<CAPTION>
The Company McCall Adjustments(1) Combined
----------- ------ -------------- --------
<S> <C> <C> <C> <C>
Operating Revenue
1995...................... $106,269 $20,029 $ 361 $126,659
1994...................... 74,366 19,619 - 93,985
1993...................... 73,720 18,448 - 92,168
Net Income
1995...................... 10,226 1,099 - 11,325
1994...................... 7,906 1,421 - 9,327
1993...................... 7,410 1,705 - 9,115
<FN>
- -----------
(1) In August 1995, the Company and an affiliate of McCall formed SEAMAC
OFFSHORE, L.L.C. ("SEAMAC"), which was jointly owned and which operated two
vessels in Nigeria. Prior to the McCall Acquisition, SEACOR recorded its
interest in this venture based upon its 50% equity interest. As a result of the
McCall Acquisition, this venture is to be dissolved and the assets will be
wholly-owned by the Company. This adjustment consolidates 100% of SEAMAC with
SEACOR.
</FN>
</TABLE>
On June 6, 1996, the Company notified the Trustee of its 6.0% Notes of
election to call the 6.0% Notes for redemption on July 12, 1996. Holders of the
6.0% Notes have the right to convert the 6.0% Notes into shares of Common Stock
at a ratio of 39.024 shares of Common Stock per $1,000 principal amount of the
6.0% Notes (representing a conversion price of $25.625 per share) prior to the
date of redemption. If the entire $55,250,000
F-28
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. SUBSEQUENT EVENTS: (CONTINUED)
principal amount outstanding of the 6.0% Notes were converted, 2,156,076 shares
of Common Stock would be issued.
On June 6, 1996, the Company and CNN entered into an agreement (the
"1996 CNN Agreement") pursuant to which the Company agreed to acquire six
vessels from CNN for an aggregate purchase price of $22,675,000, with the
understanding that three of such vessels will be bareboat chartered to CNN. The
1996 CNN Agreement also provides for the Company to prepay the promissory notes
issued to CNN by a subsidiary of the Company on December 17, 1993 in connection
with the Company's acquisition on such date of certain vessels from CNN. In
addition, CNN has notified the Company of its election to convert $4.75 million
principal amount of the Company's 2.5% Notes issued to CNN in connection with
such acquisition of vessels into 156,650 shares of Common Stock in accordance
with the terms of the 2.5% Notes. Pursuant to the 1996 CNN Agreement, the
Company agreed to include 459, 948 shares of Common Stock owned by CNN on June
6, 1996 and the 156,650 additional shares of Common Stock to be issued to CNN
upon the conversion of the 2.5% Notes in Offering for resale to the public. The
1996 CNN Transaction is conditioned upon the sale of such 616,598 shares of
Common Stock pursuant to this offering and is intended to occur substantially
simultaneously with such sale. In connection with this transaction, the Company
expects to record an extraordinary loss in connection with the prepayment of the
promissory note of approximately $861,000, net of tax.
On June 7, 1996, the Company filed a Registration Statement with the
Securities and Exchange Commission, covering the sale of 750,000 shares of its
common stock to the public and registering additional shares to be sold by
selling shareholders, including the CNN shares discussed above.
F-29
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA, UNAUDITED)
SEPTEMBER 30, DECEMBER 31,
1996 1995
-------------------- -------------------
<S> <C> <C>
ASSETS
Current Assets:
Cash and temporary cash investments............................... $ 28,484 $ 28,786
Marketable securities............................................. 307 623
Trade and other receivables, net of allowance for
doubtful accounts of $459 and $380, respectively............... 44,479 32,900
Affiliate receivables............................................. 304 872
Inventories....................................................... 1,487 1,602
Prepaid expenses and other........................................ 2,131 3,490
----------------- ----------------
Total current assets.............................................. 77,192 68,273
----------------- ----------------
Investments in, at Equity, and Receivables from 50%
or Less Owned Companies........................................... 7,306 6,484
----------------- ----------------
Property and Equipment.............................................. 374,521 337,946
Less-Accumulated depreciation..................................... (92,392) (75,038)
----------------- ----------------
Net property and equipment........................................ 282,129 262,908
----------------- ----------------
Other Assets........................................................ 11,944 13,218
----------------- ----------------
$ 378,571 $ 350,883
================= ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt................................ 276 2,489
Accounts payable - trade......................................... 12,190 7,742
Accounts payable - affiliates.................................... 1,983
Other current liabilities........................................ 11,933 9,519
---------------- ----------------
Total current liabilities..................................... 26,382 19,750
---------------- ----------------
Long-Term Debt, Less Debt Discount of $2,188 in 1995............... 7,955 108,066
Deferred Income Taxes.............................................. 38,071 36,182
Deferred Gain and Other Liabilities................................ 1,980 1,474
Minority Interest and Indebtedness to Shareholder.................. 1,853 1,947
Stockholders' Equity:
Common stock, $.01 par value, 13,155,250 and
9,886,393 shares issued at September 30, 1996,
and December 31, 1995, respectively........................... 131 99
Additional paid-in capital......................................... 223,853 127,317
Retained earnings.................................................. 80,539 57,852
Less 55,768 shares held in treasury at September 30,
1996, and December 31, 1995, at cost............................. (576) (576)
Less unamortized restricted stock compensation..................... (747) (159)
Currency translation adjustments................................... (870) (1,069)
----------------- ----------------
Total stockholders' equity.................................... 302,330 183,464
----------------- ----------------
$378,571 $ 350,883
================= ================
</TABLE>
The accompanying notes are an integral part of the financial statements and
should be read in conjunction herewith.
F-30
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE DATA, UNAUDITED)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------------- ---------------------------------
1996 1995 1996 1995
--------------- --------------- --------------- ---------------
<S> <C> <C> <C>
Operating Revenue:
Marine .............................................. $ 50,307 $ 24,368 $ 138,043 $ 65,957
Environmental-
Oil spill response................................. 2,628 7,728 8,547 8,367
Retainer and other services........................ 4,610 3,930 13,703 7,721
--------------- --------------- -------------- -------------
57,545 36,026 160,293 82,045
--------------- --------------- -------------- -------------
Costs and Expenses:
Costs of oil spill response........................... 2,263 6,956 7,655 7,117
Operating expenses -
Marine............................................. 27,110 15,818 77,137 42,819
Environmental...................................... 1,747 1,303 4,511 2,874
Administrative and general............................ 5,759 3,592 16,876 8,249
Depreciation and amortization......................... 6,249 4,665 17,791 12,773
--------------- --------------- -------------- -------------
43,128 32,334 123,970 73,832
--------------- --------------- -------------- -------------
Operating Income.......................................... 14,417 3,692 36,323 8,213
--------------- --------------- -------------- -------------
Other (Expense) Income:
Interest on debt...................................... (555) (1,250) (4,007) (4,149)
Interest income....................................... 689 269 1,731 1,789
Gain (loss) from equipment sales or retirements....... 926 (359) 1,448 1,814
McCall acquisition costs.............................. (37) - (509) -
Other, net............................................ (299) 21 11 248
-------------- --------------- -------------- --------------
724 (1,319) (1,326) (299)
--------------- --------------- -------------- --------------
Income Before Income Taxes, Minority
Interest, Equity in Net Earnings of
50% or Less Owned Companies and Extraordinary
Item .............................................. 15,141 2,373 34,997 7,914
Income Tax Expenses....................................... 5,240 863 12,445 2,852
--------------- --------------- -------------- --------------
Income Before Minority Interest, Equity in Net
Earnings of 50% or Less Owned Companies and
Extraordinary Item.................................... 9,901 1,510 22,552 5,062
Minority Interest in Loss of a Subsidiary................. 29 81 176 250
Equity in Net Earnings of 50% or Less Owned
Companies............................................. 325 246 766 746
--------------- --------------- -------------- --------------
Income Before Extraordinary Item...................... 10,255 1,837 23,494 6,058
Extraordinary Item - Loss on Extinguishment
of Debt............................................ 807 - 807 -
--------------- --------------- -------------- --------------
Net Income............................................ $ 9,448 $ 1,837 $ 22,687 $ 6,058
=============== =============== ============== ==============
Earnings Per Common Share - Assuming No Dilution:
Income before Extraordinary Item...................... $ 0.78 $ 0.25 $ 2.15 $ 0.82
Extraordinary Item................................. (0.06) - (0.07) -
--------------- --------------- -------------- --------------
Net Income...................................... $ 0.72 $ 0.25 $ 2.08 $ 0.82
=============== =============== ============== ==============
Earnings Per Common Share - Assuming Full Dilution:
Income before Extraordinary Item................... $ 0.77 $ 0.24 $ 1.93 $ 0.80
Extraordinary Item................................. (0.06) - (0.06) -
--------------- --------------- -------------- --------------
Net Income...................................... $ 0.71 $ 0.24 $ 1.87 $ 0.80
=============== =============== ============== ==============
Weighted Average Common Shares:
Assuming No Dilution............................... 13,074,963 7,435,320 10,923,340 7,358,055
Assuming Full Dilution............................. 13,347,014 9,890,728 12,725,616 9,813,463
</TABLE>
The accompanying notes are an integral part of the financial statements and
should be read in conjunction herewith.
F-31
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS, UNAUDITED)
Nine Months Ended September 30,
1996 1995
---- ----
<S> <C> <C>
Net Cash Provided by Operating Activities............................... $ 40,455 $ 5,378
------------------- -----------------
Cash Flows from Investing Activities:
Purchase of property and equipment................................... (37,382) (1,767)
Purchase of marketable securities.................................... (326) -
Proceeds from sale of marketable securities.......................... 642 -
Investments in and advances to 50% or less owned
companies............................................................ (293) (870)
Cash acquired in a business combination.............................. - 1,966
Assets acquired from John E. Graham & Sons........................... - (72,854)
Principal payments received under a sale-type lease.................. 133 -
Principal payments on notes due from 50% or less
owned companies................................................... 747 -
Proceeds from sale of equipment...................................... 2,318 4,076
Other ............................................................... 288 -
------------------- ----------------
Net cash used in investing activities............................. (33,873) (69,449)
------------------- ----------------
Cash Flows from Financing Activities:
Principal payments on long-term debt................................. (50,733) (19,052)
Payments of public offering costs.................................... (448) -
Net proceeds from sale of common stock............................... 37,679 -
(Payments) proceeds on stockholders' loans........................... (1,596) 242
Proceeds from issuance of long-term debt............................. 7,711 74,000
Proceeds from exercise of stock options.............................. 489 -
Purchase of 6% convertible subordinated notes........................ - (1,980)
-------------------- -----------------
Net cash (used) provided in financing activities.................. (6,898) 53,210
-------------------- -----------------
Effect of Exchange Rate Changes
on Cash and Cash Equivalents......................................... 14 (2)
-------------------- ------------------
Net Decrease in Cash and Cash Equivalents............................... (302) (10,863)
Cash and Cash Equivalents, Beginning of Period.......................... 28,786 44,332
-------------------- -----------------
Cash and Cash Equivalents, End of Period................................ $ 28,484 $ 33,469
==================== =================
</TABLE>
The accompanying notes are an integral part of the financial statements and
should be read in conjunction herewith.
F-32
<PAGE>
<PAGE>
SEACOR HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION -
The condensed consolidated financial information for the three and nine-month
periods ended September 30, 1996, and the three and nine-month periods ended
September 30, 1995, has been prepared by the Company and was not audited by its
independent public accountants. In the opinion of management, all adjustments
(which include only normal recurring adjustments) necessary to present fairly
the financial position, results of operations, and cash flows at September 30,
1996, and for all periods presented have been made. Results of operations for
the interim periods presented are not necessarily indicative of the operating
results for the full year or any future periods.
On May 31, 1996, the Company acquired McCall Enterprises, Inc. and affiliated
companies pursuant to a series of merger and share exchange agreements. This
acquisition has been accounted for as a pooling-of-interests. The financial
statements included herein are based upon the assumption that the companies were
combined for the nine-months ended September 30, 1996, and the financial
statements of the prior year have been restated to give effect to the business
combination.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These condensed consolidated financial
statements should be read in conjunction with the financial statements and
related notes thereto included in the Company's Annual Report on Form 10-K for
the fiscal year ended December 31,1995 and the Company's Current Report on Form
8-K dated May 31, 1996 and filed with the Securities and Exchange Commission on
June 14, 1996.
2. EARNINGS PER SHARE -
Earnings per common share assuming no dilution were computed based on the
weighted average number of unrestricted and restricted common shares issued and
outstanding during the relevant periods. The additional common stock assumed to
be outstanding to reflect the dilutive effect of common stock equivalents was
excluded from the computation as insignificant.
Earnings per common share assuming full dilution were computed based on the
weighted average number of unrestricted and restricted common shares issued and
outstanding, additional shares assumed to be outstanding to reflect the dilutive
effect of common stock equivalents using the treasury stock method, and the
assumption that all convertible subordinated notes were converted to common
stock. Net income has been adjusted for interest expense and debt discount
amortization (net of income tax) associated with the convertible subordinated
notes. During July 1996, all of the Company's then outstanding Convertible
Subordinated Notes Were converted into shares of the Company's common stock.
3. LONG-TERM DEBT -
During the nine months ended September 30, 1996, indebtedness of the Company's
borrowing subsidiaries to Den norske Bank A/S ("DnB") under the revolving credit
facility dated September 15, 1995, as amended, was reduced by $32.3 million, the
net result of $40.0 million in repayments offset by $7.7 million in borrowings.
The Company has guaranteed the obligations of its borrowing subsidiaries to DnB
under such credit facility.
F-33
<PAGE>
<PAGE>
4. 1996 COMMON STOCK OFFERING
On July 3, 1996, the Company sold in an underwritten public offering 909,235
shares of its common stock at $43.50 per share (the "1996 Common Stock
Offering"). In conjunction therewith, 842,355 shares of common stock were sold
by certain of the Company's stockholders. The Company received net proceeds of
approximately $37.7 million of which $26.0 million was used to purchase four
vessels acquired from Compagnie Nationale de Navigation, a French corporation
("CNN"), pursuant to the 1996 CNN Transaction (defined below) and to prepay $9.6
million of indebtedness then owed by the Company to CNN, and the remainder of
which has been allocated for general corporate purposes.
5. 1996 CNN TRANSACTION -
On July 3, 1996, pursuant to an agreement entered into by the Company and CNN in
June 1996, the Company consummated a transaction providing for the acquisition
from CNN of six vessels for $22.65 million in cash. At closing, the Company
prepaid $9.6 million aggregate principal amount of the indebtedness outstanding
under promissory notes previously issued to CNN by a subsidiary of the Company.
In addition, CNN converted $4.75 million principal amount of the Company's then
outstanding 2.5% Convertible Subordinated Notes due January 1, 2004 (the "2.5%
Notes") into 156,650 shares of the Company's common stock (in accordance with
the terms of the 2.5% Notes), and subsequently sold all 616,598 shares of the
Company's common stock then owned by it (including the shares of the Company's
common stock received by CNN upon such conversion) in the 1996 Common Stock
Offering.
The Company's common stock issued upon conversion of the 2.5% Notes has been
recorded in stockholders' equity at $3.9 million, the net carrying value of the
2.5% Notes based on the $4.75 million principal amount outstanding on the
conversion date and $0.8 million of related debt discount. The difference
between the $9.6 million paid to extinguish the promissory notes due to CNN and
their $8.4 million net carrying value has been recorded by the Company as an
$0.8 million extraordinary loss ($0.06 per primary share), net of a $0.4 million
income tax benefit.
6. 6.0% NOTE CONVERSION -
On July 12, 1996, following notice from the Company of the redemption on such
date of all $55.25 million principal amount of its then outstanding 6.0%
Convertible Subordinated Notes due July 1, 2003 (the "6.0% Notes"), the holders
thereof converted all of such 6.0% Notes into an aggregate of 2,156,083 shares
of the Company's common stock. The conversion of these shares has been recorded
in stockholders' equity at $53.79 million, the net carrying value of the 6.0%
Notes based on the $55.25 million outstanding principal amount thereof on the
conversion date and $1.46 million related debt issuance costs.
7. CAPITAL COMMITMENTS -
The Company has committed to build nine vessels over the next two years for an
aggregate capital expenditure of approximately $74.25 million and has total
commitments for vessel construction and vessel upgrades of $78.8 million. Of
these amounts, approximately $8.4 million has been funded to date by the
Company. The Company intends to receive approximately $9.4 million from
Transportation Maritima Mexicana ("TMM"), pursuant to a Memorandum of
Understanding dated September 25, 1996 between TMM and the Company, in exchange
for a minority interest in three vessels under construction.
F-34
<PAGE>
<PAGE>
8. SUBSEQUENT EVENTS
SMIT TRANSACTION
On December 19, 1996, the Company acquired substantially all of the offshore
vessel assets, vessel spare parts and certain related joint venture interests
owned by Smit Internationale N.V. ("Smit") and its subsidiaries (the "Smit
Transaction"). The aggregate consideration, including amounts payable under
certain lease purchase agreements for two vessels, consisted of (i)
approximately $71,448,000 in cash (including approximately $393,000 for vessel
spare parts), (ii) 712,000 shares of common stock of which 31,517 shares were
issued subsequent to December 31, 1996, and (iii) up to $22,000,000 principal
amount of the Company's Series A 5-3/8% Convertible Subordinated Notes Due
November 15, 2006 (the "Smit Notes") of which $15,250,000 were issued at close.
In addition, the definitive agreements for the Smit Transaction provide for the
payment by the Company, in a combination of cash and non-convertible notes, of
up to $47,200,000 of additional consideration based upon the 1997 and 1998
earnings performance of certain assets acquired from Smit. The acquired assets
include 100% interests in 24 vessels and 50% interests in nine vessels sold
directly by Smit and Smit's interest in joint ventures that own and operate 12
vessels.
In addition, on December 19, 1996, the Company and Smit signed a letter of
intent providing for an entity in which SEACOR or a subsidiary of SEACOR owns an
equity interest to acquire four vessels (the "Malaysian Purchase") that are
owned by a Malaysian joint venture in which Smit has an interest for aggregate
consideration of approximately $12,909,000. The terms of the Malaysian Purchase
are preliminary in nature and there can be no assurance that any definitive
transaction documentation will be entered into or, if entered into, that the
Malaysian Purchase will be consummated.
COMMON STOCK LISTING ON NYSE
On October 23, 1996, the Company's common stock commenced trading on the New
York Stock Exchange, Inc. under the trading symbol "CKH." From December 1992
until October 23, 1996, the Company's common stock was traded on the Nasdaq
Stock Market's National Market under the trading symbol "CKOR."
GALAXIE TRANSACTION
On January 3, 1997, the Company acquired substantially all of the offshore
marine assets, including vessels, owned by Galaxie Marine Service, Inc.,
Moonmaid Marine, Inc., Waveland Marine Service, Inc. and Triangle Marine, Inc.
(collectively, "Galaxie"), for an aggregate consideration of $23,617,000,
consisting of $20,567,000 in cash and 50,000 shares of common stock (which based
on the closing sale price of the common stock as reported on the NYSE Composite
Tape on the NYSE on January 2, 1997, had an aggregate value of approximately
$3,050,000). The assets acquired included 24 vessels and other related tangible
and intangible assets.
5-3/8% CONVERTIBLE SUBORDINATED NOTES OFFERING
On November 5, 1996, the Company completed the sale of $172.5 million aggregate
principal amount of its 5-3/8% Convertible Subordinated Notes due November 15,
2006 (the "Notes"). The Notes are convertible, in whole or in part, at the
option of the holder at any time from and after January 5, 1997 and prior to the
close of business on the business day next preceding November 15, 2006, unless
previously redeemed, into shares of the Company's common stock at a conversion
price of $66.00 per share (equivalent to a conversion rate of 15.1515 shares of
the Company's common stock per $1,000 principal amount of Notes), subject to
adjustment in certain circumstances. The Notes are redeemable at the Company's
option at any time from and after November 24,
F-35
<PAGE>
<PAGE>
8. SUBSEQUENT EVENTS - (CONTINUED)
1999 at the redemption prices specified therein, together with accrued and
unpaid interest to the date of repurchase. Moreover, if a "Change-in-Control"
(as defined in the Indenture for the Notes) of the Company were to occur, the
holder of Notes would be entitled to require the Company to repurchase its
Notes, in whole or in part, at a purchase price equal to 100% of the principal
amount thereof, together with accrued and unpaid interest through the date of
repurchase. No sinking fund is provided for the Notes; which are general
unsecured obligations of the Company, subordinated in right of payment to all
"Senior Indebtedness" (as defined in the Indenture for the Notes) of the Company
and effectively subordinated in right of payment to all indebtedness of the
Company's subsidiaries.
The Notes were sold by the Company to Credit Suisse First Boston Corporation,
Salomon Brothers Inc and Wasserstein Perella Securities, Inc., as initial
purchasers (the "Initial Purchasers"), in an unregistered private placement
conducted pursuant to Section 4(2) of the Securities Act of 1933, as amended
(the "Securities Act"). The discount to the Initial Purchasers was 2.25% per
$100 principal amount of Notes (or an aggregate of approximately $3.88 million).
The Initial Purchasers subsequently resold the Notes in the United States to
"qualified institutional buyers" in reliance on Rule 144A under the Securities
Act and to a limited number of institutional "accredited investors" (as defined
in Rule 501(a)(1), (2), (3) or (7) under the Securities Act), and outside of the
United States in offshore transactions to investors in reliance on Regulation S
under the Securities Act. Approximately $148.88 million principal amount of the
Notes were resold by the Initial Purchasers to qualified institutional buyers in
reliance on Rule 144A, approximately $3.27 million principal amount of the Notes
were resold by the Initial Purchasers to institutional accredited investors, and
approximately $22.35 million principal amount of the Notes were resold by the
Initial Purchasers in offshore transactions to investors in reliance on
Regulation S under the Securities Act.
The net proceeds to the Company from the sale of the Notes to the Initial
Purchasers was approximately $168.3 million (after the deduction of certain
transaction expenses paid by the Company). The Company intends to use such net
proceeds to fund its capital expansion program, including the construction of
new vessels (described above under the caption "Capital Commitments"), and for
general corporate purposes, including acquisitions.
VESSEL ACQUISITION
Subsequent to September 30, 1996, the Company acquired one vessel from CNN for a
purchase price of $2.65 million in cash that was provided from the Company's
existing cash balances. The vessel was acquired pursuant to the terms of an
agreement entered into by the Company and CNN in June 1996, see Note 5.
F-36
<PAGE>
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL
OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THE SECURITIES
DESCRIBED HEREIN, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
ANY OFFER TO BUY THE SECURITIES DESCRIBED HEREIN BY ANYONE IN ANY JURISDICTION
IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON
MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO
WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY
TIME SUBSEQUENT TO THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
PAGE
Available Information........................................................2
Incorporation of Certain Information
by Reference...............................................................3
Summary......................................................................4
Risk Factors................................................................12
Use of Proceeds.............................................................18
Dividend Policy.............................................................18
Selected Historical Financial
Information ..............................................................19
Description of Notes........................................................21
Selling Securityholders.....................................................34
Certain United States Federal
Tax Considerations........................................................47
Plan of Distribution........................................................53
Notice to Canadian Resident.................................................54
Limitation on Foreign
Ownership of Securities...................................................55
Legal Matters...............................................................55
Experts.....................................................................55
Index to Financial
Statements...............................................................F-1
SEACOR HOLDINGS, INC.
$187,750,000
5-3/8% CONVERTIBLE SUBORDINATED
NOTES DUE NOVEMBER 15, 2006
2,844,694 SHARES
COMMON STOCK ISSUABLE UPON THE
CONVERSION THEREOF
PROSPECTUS
____________ __, 1997
<PAGE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The table below sets forth the expenses expected to be incurred and borne
solely by the Company in connection with the registration of the shares of
Common Stock offered hereby.(1)
SEC Registration Fee...............................................$56,893.94
Legal Fees and Expenses............................................ 50,000.00
Blue Sky Fees and Expenses......................................... 5,000.00
Miscellaneous...................................................... 8,106.06
Total...............................................$120,000.00
- ------------------
(1) The Selling Securityholders have not paid any portion of the registration
expenses.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As more fully described below, Section 145 of the DGCL permits
Delaware corporations to indemnify each of their present and former directors or
officers under certain circumstances, provided that such persons acted in good
faith and in a manner which they reasonably believed to be in, or not opposed
to, the best interests of the corporation. Article Eight of the By-laws provides
that the Company shall indemnify, to the fullest extent permitted by Section 145
of the DGCL, as the same may be amended from time to time, all persons whom it
may indemnify pursuant thereto.
Specifically, Section 145 of the DGCL provides that a corporation
may indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation) by reason of the fact that he is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee, or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit, or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, or, with respect to any criminal action or proceeding, that he had
reasonable cause to believe that his conduct was unlawful.
Section 145 of the DGCL also provides that a corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending, or completed action or suit by or in the right of
the corporation to procure a judgment in its favor by reason of the fact that he
is or was a director, officer, employee, or agent of the corporation, or is or
was serving at the request of the corporation as a director, officer, employee,
or agent of another corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense
II-1
<PAGE>
<PAGE>
or settlement of such action or suit if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon adjudication that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
Any such indemnification (unless ordered by a court) shall be made
by the corporation only as authorized in the specific case upon a determination
that indemnification of the director, officer, employee or agent is proper in
the circumstances because such person has met the applicable standard of conduct
set forth above.
Section 145 of the DGCL permits a Delaware business corporation to
purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against any liability asserted against such person and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify such person.
Section 102(b) of the DGCL enables a Delaware corporation to
include a provision in its certificate of incorporation limiting a director's
liability to the corporation or its stockholders for monetary damages for
breaches of fiduciary duty as a director. The Certificate of Incorporation
contains provisions that limit the personal liability of each director to the
Registrant or its stockholders for monetary damages for breach of the fiduciary
duty of care as a director. These provisions eliminate personal liability to the
fullest extent permitted by the DGCL.
ITEM 16. EXHIBITS AND FINANCIAL SCHEDULES
(a) Exhibits
2.0 Asset Purchase Agreement, dated as of December 19, 1996, by and among
SEACOR Holdings, Inc. and certain of its subsidiaries, and Smit
Internationale N.V. and certain of its subsidiaries (incorporated herein
by reference to Exhibit 2.0 to the Company's Current Report on Form 8-K
dated December 19, 1996 and filed with the Commission on December 24,
1996).
2.1 Purchase Agreement, dated as of December 3, 1996, among SEACOR Holdings,
Inc., Acadian Offshore Services, Inc., Galaxie Marine Service, Inc.,
Moonmaid Marine, Inc., Triangle Marine, Inc., F.C. Felterman, Ernest
Felterman, D. Lee Felterman and Daniel C. Felterman (incorporated herein
by reference to Exhibit 2.1 to the Company's Registration Statement on
Form S-3 (No. 333-20921) filed with the Commission on January 31, 1997).
2.2 Purchase Agreement, dated as of December 3, 1996, among SEACOR Holdings,
Inc., Waveland Marine Service, Inc., F.C. Felterman, Ernest Felterman, D.
Lee Felterman and Daniel C. Felterman (incorporated herein by reference to
Exhibit 2.2 to the Company's Registration Statement on Form S-3 (No.
333-20921) filed with the Commission on January 31, 1997).
4.0 Restated Stockholders' Agreement, dated December 16, 1992, by and among
the Company and the stockholders party thereto (incorporated herein by
reference to Exhibit 10.12 of the Company's Registration Statement on Form
S-1 (No. 33-53744) filed with the Commission on November 10, 1992, as
amended).
II-2
<PAGE>
<PAGE>
4.1 Investment and Registration Rights Agreement, dated as of March 14, 1995,
by and among SEACOR Holdings, Inc., Miller Family Holdings, Inc., Charles
Fabrikant, Mark Miller, Donald Toenshoff, Alvin Wood, Granville Conway and
Michael Gellert (incorporated herein by reference to Exhibit 4.0 of the
Company's Current Report on Form 8-K dated March 14, 1995, as amended).
4.2 Investment and Registration Rights Agreement, dated as of May 31, 1996,
among SEACOR Holdings, Inc. and the persons listed on the signature pages
thereto (incorporated herein by reference to Exhibit 10.8 to the Company's
Current Report on Form 8-K dated May 31, 1996 and filed with the
Commission on June 7, 1996).
4.3 Indenture, dated as of November 1, 1996, between First Trust National
Association, as trustee, and SEACOR Holdings, Inc. (including therein
forms of 5-3/8% Convertible Subordinated Notes due November 15, 2006 of
SEACOR Holdings, Inc.) (incorporated herein by reference to Exhibit 4.0 to
the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended
September 30, 1996 and filed with the Commission on November 14, 1996).
4.4 Registration Rights Agreement, dated November 5, 1996, between SEACOR
Holdings, Inc. and Credit Suisse First Boston Corporation, Salomon
Brothers Inc and Wasserstein Perella Securities, Inc. (incorporated herein
by reference to Exhibit 4.1 to the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ended September 30, 1996 and filed with the
Commission on November 14, 1996).
4.5 Investment and Registration Rights Agreement, dated as of December 19,
1996, by and between SEACOR Holdings, Inc. and Smit International Overseas
B.V. (incorporated herein by reference to Exhibit 4.0 to the Company's
Current Report on Form 8-K dated December 19, 1996 and filed with the
Commission on December 24, 1996).
4.6 Investment and Registration Rights Agreement, dated as of January 3, 1997,
among SEACOR Holdings, Inc., Acadian Offshore Services, Inc., Galaxie
Marine Service, Inc., Moonmaid Marine, Inc. and Triangle Marine, Inc.
(incorporated herein by reference to Exhibit 4.6 to the Company's
Registration Statement on Form S-3 (333-20921) filed with the Commission
on January 31, 1997).
5.0 Opinion of Weil, Gotshal & Manges LLP.*
12.0 Ratio of Earnings to Fixed Charges.*
23.0 Consent of Arthur Andersen LLP.*
23.1 Consent of Coopers & Lybrand L.L.P.*
23.2 Consent of Weil, Gotshal & Manges LLP (included in its opinion filed as
Exhibit 5.1).*
24.0 Powers of Attorney.*
25.0 Statement of Eligibility and Qualification of First Trust National
Association on Form T-1.*
- -----------------
* Filed herewith.
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
II-3
<PAGE>
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended (the "Securities Act"), each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act of 1934, as amended (the "Exchange Act") (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(j) The undersigned registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act of 1939 as amended (the "Act") in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b)(2) of the Act.
II-4
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York on February 24, 1997.
SEACOR HOLDINGS, INC.
By: /s/ Randall Blank
---------------------
Randall Blank
Executive Vice President,
Chief Financial Officer
and Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below on this Registration Statement hereby constitutes and appoints Charles
Fabrikant and Randall Blank and each of them, with full power to act without the
other, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities (until revoked in writing), to sign any and all amendments or
supplements (including post-effective amendments thereto) to this Form S-3
Registration Statement of SEACOR Holdings, Inc. and any registration statement
filed pursuant to Rule 462 and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto each said attorneys-in-fact and agents, full power and
authority to do and perform each and every act and thing requisite and necessary
fully to all intents and purposes as he might or could do in person, thereby
ratifying and confirming all that each of said attorneys-in-fact and agents, or
their or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
/s/ Charles Fabrikant Chairman of the Board of February 24, 1997
- ------------------------ Directors, President and
Charles Fabrikant Chief Executive Officer
/s/ Randall Blank Executive Vice President, February 24, 1997
- ------------------------ Chief Financial Officer
Randall Blank and Secretary (Principal
Financial Officer)
Director
- ------------------------
Granville E. Conway
/s/ Michael E. Gellert Director February 24, 1997
- ------------------------
Michael E. Gellert
/s/ Robert J. Pierot Director February 24, 1997
- ------------------------
Robert J. Pierot
/s/ Stephen Stamas Director February 24, 1997
- ------------------------
Stephen Stamas
II-5
<PAGE>
<PAGE>
/s/ Richard N. Fairbanks III Director February 24, 1997
- ------------------------------
Richard M. Fairbanks III
/s/ Pierre de Demandolx Director February 24, 1997
- ------------------------------
Pierre de Demandolx
/s/ Lenny P. Dantin Vice President and February 24, 1997
- ------------------------------ Treasurer (Principal
Lenny P. Dantin Accounting Officer
and Controller)
II-6
<PAGE>
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
2.0 Asset Purchase Agreement, dated as of December 19, 1996, by and among
SEACOR Holdings, Inc. and certain of its subsidiaries, and Smit
Internationale N.V. and certain of its subsidiaries (incorporated herein
by reference to Exhibit 2.0 to the Company's Current Report on Form 8-K
dated December 19, 1996 and filed with the Commission on December 24,
1996).
2.1 Purchase Agreement, dated as of December 3, 1996, among SEACOR Holdings,
Inc., Acadian Offshore Services, Inc., Galaxie Marine Service, Inc.,
Moonmaid Marine, Inc., Triangle Marine, Inc., F.C. Felterman, Ernest
Felterman, D. Lee Felterman and Daniel C. Felterman (incorporated herein
by reference to Exhibit 2.1 to the Company's Registration Statement on
Form S-3 (No. 333-20921) filed with the Commission on January 31, 1997).
2.2 Purchase Agreement, dated as of December 3, 1996, among SEACOR Holdings,
Inc., Waveland Marine Service, Inc., F.C. Felterman, Ernest Felterman, D.
Lee Felterman and Daniel C. Felterman (incorporated herein by reference to
Exhibit 2.2 to the Company's Registration Statement on Form S-3 (No.
333-20921) filed with the Commission on January 31, 1997).
4.0 Restated Stockholders' Agreement, dated December 16, 1992, by and among
the Company and the stockholders party thereto (incorporated herein by
reference to Exhibit 10.12 of the Company's Registration Statement on Form
S-1 (No. 33-53744) filed with the Commission on November 10, 1992, as
amended).
4.1 Investment and Registration Rights Agreement, dated as of March 14, 1995,
by and among SEACOR Holdings, Inc., Miller Family Holdings, Inc., Charles
Fabrikant, Mark Miller, Donald Toenshoff, Alvin Wood, Granville Conway and
Michael Gellert (incorporated herein by reference to Exhibit 4.0 of the
Company's Current Report on Form 8-K dated March 14, 1995, as amended).
4.2 Investment and Registration Rights Agreement, dated as of May 31, 1996,
among SEACOR Holdings, Inc. and the persons listed on the signature pages
thereto (incorporated herein by reference to Exhibit 10.8 to the Company's
Current Report on Form 8-K dated May 31, 1996 and filed with the
Commission on June 7, 1996).
4.3 Indenture, dated as of November 1, 1996, between First Trust National
Association, as trustee, and SEACOR Holdings, Inc. (including therein
forms of 5-3/8% Convertible Subordinated Notes due November 15, 2006 of
SEACOR Holdings, Inc.) (incorporated herein by reference to Exhibit 4.0 to
the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended
September 30, 1996 and filed with the Commission on November 14, 1996).
4.4 Registration Rights Agreement, dated November 5, 1996, between SEACOR
Holdings, Inc. and Credit Suisse First Boston Corporation, Salomon
Brothers Inc and Wasserstein Perella Securities, Inc. (incorporated herein
by reference to Exhibit 4.1 to the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ended September 30, 1996 and filed with the
Commission on November 14, 1996).
4.5 Investment and Registration Rights Agreement, dated as of December 19,
1996, by and between SEACOR Holdings, Inc. and Smit International Overseas
B.V. (incorporated herein by reference to Exhibit 4.0 to the Company's
Current Report on Form 8-K dated December 19, 1996 and filed with the
Commission on December 24, 1996).
4.6 Investment and Registration Rights Agreement, dated as of January 3, 1997,
among SEACOR Holdings, Inc., Acadian Offshore Services, Inc., Galaxie
Marine Service, Inc., Moonmaid Marine, Inc. and Triangle Marine, Inc.
(incorporated herein by reference to Exhibit 4.6 to the Company's
Registration Statement on Form S-3 (333-20921) filed with the Commission
on January 31, 1997).
5.0 Opinion of Weil, Gotshal & Manges LLP.*
12.0 Ratio of Earnings to Fixed Charges.*
23.0 Consent of Arthur Andersen LLP.*
23.1 Consent of Coopers & Lybrand L.L.P.*
23.2 Consent of Weil, Gotshal & Manges LLP (included in its opinion filed as
Exhibit 5.1).*
24.0 Powers of Attorney.*
25.0 Statement of Eligibility and Qualification of First Trust National
Association on Form T-1.*
- -----------------
* Filed herewith.
II-7
NYFS11...:\93\73293\0004\1711\FRM1027U.42G
EXHIBIT 5.0
WEIL, GOTSHAL & MANGES LLP
A LIMITED LIABILITY PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS
767 FIFTH AVENUE o NEW YORK, NY 10153-0119
(212) 310-8000
FAX: (212) 310-8007
February 24, 1997
The Board of Directors
SEACOR Holdings, Inc.
11200 Westheimer
Suite 850
Houston, TX 77042
Ladies and Gentlemen:
We have acted as counsel to SEACOR Holdings, Inc., a Delaware
corporation (the "Company"), in connection with the preparation and filing of
the Registration Statement of the Company on Form S-3 (the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the intended resale from time to time by the Selling Stockholders
(in the manner described in the prospectus (the "Prospectus") contained in the
Registration Statement) of up to an aggregate of $187,750,000 principal amount
of the 5-3/8% Convertible Subordinated Notes due November 15, 2006 (the "Notes")
of the Company and 2,844,694 shares of Common Stock, $.01 par value (the "Common
Stock"), of the Company issuable upon conversion of the Notes.
In so acting, we have reviewed the Registration Statement, including
the Prospectus contained therein, the Restated Certificate of Incorporation and
the Amended and Restated Bylaws of the Company in effect on the date hereof and
the Indenture, dated as of November 1, 1996, between the Company and First Trust
National Association, as trustee (the "Indenture"). In addition, we have
examined originals or copies, certified or otherwise identified to our
satisfaction, of such corporate records, agreements, documents and other
instruments, and such certificates or comparable documents of public officials
and of officers and representatives of the Company, and have made such inquiries
of such officers and representatives, as we have deemed relevant and necessary
as a basis for the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all
signatures, the legal capacity of natural persons, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified, conformed or photostatic copies and
the authenticity of the originals of such latter documents. As to all questions
of fact material to this opinion that have not been independently established,
we have relied upon certificates or comparable documents of officers and
representatives of the Company.
Based on the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Notes to be sold by the Selling Securityholders in the manner
described under the captions "Selling Securityholders" and "Plan of
Distribution" in the Prospectus contained in the Registration Statement have
been validly issued and constitute the legally binding obligations of the
Company entitled to the benefits of the Indenture in accordance with their
terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors rights and
remedies generally and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether a proceeding is sought at law or in equity).
2. Subject to the provisions and limitations of Article Eighth
and Article VII (Sections 2 and 3) of the Restated Certificate of Incorporation
and the Amended and Restated By-laws, respectively, of the Company in the case
of foreign holders of the Notes and the Company's Common Stock, the Notes are
convertible into shares of
<PAGE>
<PAGE>
Common Stock in accordance with their terms and the conditions thereto
prescribed by the Indenture and the shares of Common Stock issuable upon
conversion of the Notes have been duly authorized and reserved for issuance upon
such conversion and, when issued and delivered in accordance with their terms
and the conditions thereto prescribed by the Indenture, will be validly issued,
fully paid and nonassessable.
The opinions expressed herein are limited to the corporate laws of
the State of Delaware and the federal laws of the United States, and we express
no opinion as to the effect on the matters covered by this letter of the laws of
any other jurisdiction.
The opinions expressed herein are rendered solely for your benefit
in connection with the transactions described herein. Those opinions may not be
used or relied upon by any other person, nor may this letter or any copies
thereof be furnished to a third party, filed with a governmental agency, quoted,
cited or otherwise referred to without our prior written consent.
We hereby consent to the filing of this opinion as Exhibit 5.1 to
the Registration Statement and to the references to this firm under the heading
"Legal Matters" in the Prospectus, without admitting that we are "experts" under
the Securities Act or the rules and regulations promulgated thereunder with
respect to any part of the Registration Statement or Prospectus contained
therein.
Very truly yours,
/s/ Weil, Gotshal & Manges LLP
Exhibit 12.0
<TABLE>
<CAPTION>
SEACOR Holdings, Inc. and Subsidiaries
Computation of the Ratio of Earnings to Fixed Charges
(amounts in thousands, except ratio)
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------------------------------- ------------------
1991 1992 1993 1994 1995 1995 1996
------ ------ ------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C> <C> <C>
Pretax income from continuing operations $ 6,254 $ 1,602 $15,311 $12,536 $15,642 $ 7,914 $ 34,997
Add:
Minority interest before income taxes -- - (77) -- -- -- --
Interest expense 6,678 7,044 4,782 5,422 6,681 4,149 4,007
Amortized debt expenses 597 724 379 323 449 311 172
Interest factor in rent 19 22 32 35 41 27 45
------- ------- ------- ------- ------- ------- ---------
Earnings available for fixed charges $13,548 $ 9,392 $20,427 $18,316 $22,813 $12,401 $ 39,221
======= ======= ======= ======= ======= ======= =========
Interest expense $ 6,678 $ 7,044 $ 4,782 $ 5,422 $ 6,681 $ 4,149 $ 4,007
Amortized debt expenses 597 724 379 323 449 311 172
Interest factor in rent 19 22 32 35 41 27 45
------- ------- ------- ------- ------- ------- ---------
Fixed charges $ 7,294 $ 7,790 $ 5,193 $ 5,780 $ 7,171 $ 4,487 $ 4,224
======= ======= ======= ======= ======= ======= =========
Ratio of earnings to fixed charges 1.86 1.21 3.93 3.17 3.18 2.76 9.28
======= ======= ======= ======= ======= ======= ========
</TABLE>
Exhibit 23.0
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our report
included in this Registration Statement and the incorporation by reference into
this Registration Statement of our reports dated February 20, 1996, included in
SEACOR Holdings, Inc.'s Annual Report on Form 10-K for the year ended December
31, 1995, June 7, 1996 included in SEACOR's Current Report on Form 8-K dated May
31, 1996 filed on June 7, 1996 and May 10, 1996 included in SEACOR's Current
Report on Form 8-K dated May 31, 1996 filed on June 14, 1996, and to all
references to our Firm included in this Registration Statement.
/s/ Arthur Andersen LLP
New Orleans, Louisiana
February 20, 1997
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement on
Form S-3 (Registration No. 333- ) of our report dated February 20, 1996, on our
audit of the consolidated financial statements of CRN Holdings, Inc. and
Subsidiaries as of December 31, 1995 and for the year then ended, which report
is included in the Form 10-K of SEACOR Holdings, Inc. for the year ended
December 31, 1995. We also consent to the reference to our firm under the
caption "Experts."
/s/ Coopers & Lybrand L.L.P.
Melville, New York
February 21, 1997
EXHIBIT 25.0
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM T-1
Statement of Eligibility Under the
Trust Indenture Act of 1939 of a Corporation
Designated to Act as Trustee
FIRST TRUST NATIONAL ASSOCIATION
(Exact name of Trustee as specified in its charter)
United States 41-0257700
(State of Incorporation) (I.R.S. Employer
Identification No.)
First Trust Center
180 East Fifth Street
St. Paul, Minnesota 55101
(Address of Principal Executive Offices) (Zip Code)
SEACOR HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 13-3542736
(State of Incorporation) (I.R.S. Employer
Identification No.)
11200 Westheimer, Suite 850
Houston, Texas 77042
(Address of Principal Executive Offices) (Zip Code)
5 3/8% CONVERTIBLE SUBORDINATED NOTES DUE 2006
(Title of the Indenture Securities)
<PAGE>
<PAGE>
GENERAL
1. General Information Furnish the following information as to the Trustee.
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency
Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes
2. AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS If the obligor or any
underwriter for the obligor is an affiliate of the Trustee, describe
each such affiliation.
None
See Note following Item 16.
Items 3-15 are not applicable because to the best of the Trustee's
knowledge the obligor is not in default under any Indenture for which
the Trustee acts as Trustee.
16. LIST OF EXHIBITS List below all exhibits filed as a part of this
statement of eligibility and qualification. Each of the exhibits listed
below is incorporated by reference from registration number 22-27000.
1. Copy of Articles of Association.
2. Copy of Certificate of Authority to Commence Business.
3. Authorization of the Trustee to exercise corporate trust powers
(included in Exhibits 1 and 2; no separate instrument).
4. Copy of existing By-Laws.
5. Copy of each Indenture referred to in Item 4. N/A.
6. The consents of the Trustee required by Section 321(b) of the
act.
7. Copy of the latest report of condition of the Trustee published
pursuant to law or the requirements of its supervising or
examining authority.
<PAGE>
<PAGE>
NOTE
The answers to this statement insofar as such answers relate to what
persons have been underwriters for any securities of the obligors within three
years prior to the date of filing this statement, or what persons are owners of
10% or more of the voting securities of the obligors, or affiliates, are based
upon information furnished to the Trustee by the obligors. While the Trustee has
no reason to doubt the accuracy of any such information, it cannot accept any
responsibility therefor.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, First Trust National Association, an Association organized and existing
under the laws of the United States, has duly caused this statement of
eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, and its seal to be hereunto affixed and attested, all
in the City of Saint Paul and State of Minnesota on the 24th day of February,
1997.
FIRST TRUST NATIONAL ASSOCIATION
[SEAL]
/s/ Richard H. Prokosch
Richard H. Prokosch
Trust Officer
/s/ Kathe Barrett
Kathe Barrett
Assistant Secretary
<PAGE>
<PAGE>
EXHIBIT 6
CONSENT
In accordance with Section 321(b) of the Trust Indenture Act of 1939,
the undersigned, FIRST TRUST NATIONAL ASSOCIATION hereby consents that reports
of examination of the undersigned by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon its request therefor.
Dated: February 24, 1997
FIRST TRUST NATIONAL ASSOCIATION
/s/ Richard H. Prokosch
Richard H. Prokosch
Trust Officer
