SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
[X] FILED BY THE REGISTRANT
[ ] FILED BY A PARTY OTHER THAN THE REGISTRANT
CHECK THE APPROPRIATE BOX:
[ ] PRELIMINARY PROXY STATEMENT
[ ] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE
14A-6(E)(2))
[X] DEFINITIVE PROXY STATEMENT
[ ] DEFINITIVE ADDITIONAL MATERIALS
[ ] SOLICITING MATERIAL PURSUANT TO RULE 14A-11(C) OR RULE 14A-12
SEACOR SMIT INC.
-----------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
-----------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER
THAN THE REGISTRANT)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] NO FEE REQUIRED
[ ] FEE COMPUTED ON TABLE BELOW PER EXCHANGE ACT RULES 14A-6(I)(4) AND 0-11.
1) TITLE OF EACH CLASS OF SECURITIES TO WHICH TRANSACTION APPLIES:
2) AGGREGATE NUMBER OF SECURITIES TO WHICH TRANSACTION APPLIES:
3) PER UNIT PRICE OF OTHER UNDERLYING VALUE OF TRANSACTION COMPUTED PURSUANT
TO EXCHANGE ACT RULE 0-11 (SET FORTH THE AMOUNT ON WHICH THE FILING FEE
IS CALCULATED AND STATE HOW IT WAS DETERMINED):
4) PROPOSED MAXIMUM AGGREGATE VALUE OF TRANSACTION:
5) TOTAL FEE PAID:
[ ] FEE PAID PREVIOUSLY WITH PRELIMINARY MATERIALS.
[ ] CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY EXCHANGE ACT
RULE 0-11(A)(2) AND IDENTIFY THE FILING FOR WHICH THE OFFSETTING FEE WAS
PAID PREVIOUSLY. IDENTIFY THE PREVIOUS FILING BY REGISTRATION STATEMENT
NUMBER, OR THE FORM OR SCHEDULE AND THE DATE OF ITS FILING.
1) AMOUNT PREVIOUSLY PAID: $
2) FORM, SCHEDULE OR REGISTRATION STATEMENT NO.:
3) FILING PARTY:
4) DATE FILED:
<PAGE>
11200 Westheimer, Suite 850
Houston, Texas 77042
April 9, 1998
Dear Stockholder:
You are cordially invited to attend the 1998 Annual Meeting of
Stockholders of SEACOR SMIT Inc. (the "Meeting"), which will be held at the
offices of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, 25th Floor, New York,
New York 10153 on Monday, June 1, 1998 at 11:00 a.m., local time. All holders of
record of the Company's outstanding common stock at the close of business on
April 3, 1998 will be entitled to vote at the Meeting.
Directors, officers and other representatives of the Company will be
present at the Meeting and they will be pleased to answer any questions you may
have.
Whether or not you expect to attend the Meeting and regardless of the
number of shares of Common Stock you own, you are encouraged to read the
enclosed Proxy Statement and Annual Report carefully, and to complete, sign,
date and return the enclosed proxy in the postage-paid, self-addressed envelope
provided for such purpose so that your shares will be represented at the
Meeting. The prompt return of proxy cards will ensure the presence of a quorum.
We hope that you will be able to attend and look forward to seeing you
at the Meeting.
Sincerely,
/s/ Charles Fabrikant
Charles Fabrikant
Chairman of the Board, President
and Chief Executive Officer
<PAGE>
11200 Westheimer, Suite 850
Houston, Texas 77042
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 1, 1998
----------------
April 9, 1998
To Our Stockholders:
The Annual Meeting of Stockholders of SEACOR SMIT Inc. (the "Company"),
will be held on Monday, June 1, 1998, at 11:00 a.m., local time, at the offices
of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, 25th Floor, New York, New York
10153 (the "Meeting"), for the following purposes:
1. To elect eight directors to serve until the 1999 Annual Meeting of
Stockholders. Please see page 5.
2. To ratify the appointment of Arthur Andersen LLP as the Company's
independent auditors for the fiscal year ending December 31, 1998.
Please see page 19.
3. To transact such other business as may properly come before the
Meeting and any adjournments thereof.
Only holders of record of Common Stock at the close of business on
April 3, 1998 will be entitled to notice of and to vote at the Meeting. YOUR
VOTE IS VERY IMPORTANT! Please complete, sign, date and return the enclosed
proxy, whether or not you expect to attend the Meeting, so that your shares may
be represented at the Meeting if you are unable to attend and vote in person. If
you attend the Meeting, you may revoke your proxy and vote your shares in
person.
For the Board of Directors
/s/ Randall Blank
Randall Blank
Executive Vice President,
Chief Financial Officer and Secretary
<PAGE>
SEACOR SMIT INC.
11200 WESTHEIMER, SUITE 850
HOUSTON, TEXAS 77042
-----------------
PROXY STATEMENT
-----------------
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
JUNE 1, 1998
SOLICITATION OF PROXIES, VOTING, AND REVOCATION
GENERAL
This Proxy Statement and the enclosed proxy are being furnished to
holders of record of the common stock, $.01 par value (the "Common Stock"), of
SEACOR SMIT Inc., a Delaware corporation ("the Company"), in connection with the
solicitation of proxies by the Board of Directors of the Company (the "Board")
for use at the Annual Meeting of Stockholders to be held on Monday, June 1, 1998
(the "Meeting"), and at any adjournments thereof. This Proxy Statement and the
enclosed proxy are first being mailed to stockholders on April 9, 1998.
VOTING
The Board of Directors has fixed the close of business on April 3, 1998
as the record date (the "Record Date") for the determination of stockholders
entitled to notice of and to vote at the Meeting. Each such stockholder will be
entitled to one vote for each share of Common Stock held as of the Record Date
on all matters properly to come before the Meeting, and may vote in person or by
proxy authorized in writing. As of the Record Date, there were 40,000,000 shares
of Common Stock authorized, of which 13,206,943 were issued and outstanding. The
Company has no other voting securities issued or outstanding.
A list of the Company's stockholders as of the Record Date for the
Meeting will be available for examination by any stockholder, for purposes
germane to the Meeting, during ordinary business hours, for 10 days prior to the
date of the Meeting, at 1370 Avenue of the Americas, 25th Floor, New York, New
York 10019.
Stockholders are requested to complete, date, sign and promptly return
the accompanying proxy in the enclosed postage-paid, self-addressed envelope
provided for such purpose. Common Stock represented by properly executed proxies
which are received by the Company and not subsequently revoked will be voted at
the Meeting in accordance with the instructions contained therein. Abstentions
and broker non-votes will be counted as votes "Against" a proposal, but will
count towards the determination of a quorum at the Meeting. If instructions are
not given, proxies will be voted FOR the election as a director of each of
<PAGE>
management's nominees named under "Proposal No. 1 - Election of Directors" in
this Proxy Statement and listed under Item 1 of the enclosed proxy, and FOR
ratification of the appointment of Arthur Andersen LLP as the Company's
independent auditors for the fiscal year ending December 31, 1998. As to any
matters which properly may come before the Meeting other than those specified
herein, the proxy holders will be entitled to exercise discretionary authority.
As a matter of policy, proxies, ballots and voting tabulations that
identify individual stockholders are kept confidential by the Company. Such
documents are made available only by the inspectors of election and certain
personnel associated with processing proxies and tabulating votes at the
Meeting. The votes of individual stockholders will not be disclosed except as
may be required by applicable law.
REVOCATION OF PROXIES
A stockholder who so desires may revoke his or its proxy at any time
before it is exercised by (i) providing written notice to such effect to the
Secretary of the Company, (ii) duly executing a proxy bearing a date subsequent
to that of a previously furnished proxy, or (iii) attending the Meeting and
voting in person. Attendance at the Meeting will not in itself constitute a
revocation of a previously furnished proxy and stockholders who attend the
Meeting in person need not revoke their proxy (if previously furnished) and vote
in person.
SOLICITATION EXPENSES
The Company will bear the costs of solicitation of proxies for the
Meeting. In addition to solicitation by mail, directors, officers and regular
employees of the Company may solicit proxies from stockholders by telephone,
telegram, personal interview or other means. The Company will not incur any
costs beyond those customarily expended for a solicitation of proxies for the
election of directors in the absence of a contest, and said directors, officers
and employees will not receive additional compensation for their solicitation
activities, but may be reimbursed for reasonable out-of-pocket expenses incurred
by them in connection therewith. Brokers, dealers, commercial banks, trust
companies, fiduciaries, custodians and other nominees (collectively, "Nominees")
have been requested to forward proxy solicitation materials to their customers,
and such Nominees will be reimbursed for their reasonable out-of-pocket
expenses. The Company has engaged Proxy Services, Inc. to distribute proxy
materials to various Nominees who are holders of record of the Common Stock.
2
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding beneficial
ownership of the Common Stock by: (i) all persons (including any "group" as that
term is defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) who were known by the Company to be the beneficial
owners of more than 5% of the outstanding Common Stock, (ii) each director and
nominee for director of the Company, (iii) each executive officer of the Company
named in the Summary Compensation Table set forth below under "Executive
Compensation," and (iv) all directors and executive officers of the Company as a
group (13 persons). Except where otherwise indicated in the footnotes to the
table, all beneficial ownership information set forth below is as of the Record
Date.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNER (1) BENEFICIAL OWNERSHIP (2) PERCENTAGE OF CLASS
- ------------------------------------------------------ ----------------------------- -----------------------------
<S> <C> <C>
Charles Fabrikant (3)............................... 614,400 4.6%
Randall Blank (4)................................... 64,657 *
Milton Rose (5)..................................... 23,863 *
Mark Miller (6)..................................... 21,826 *
Andrew G. Strachan ................................. 3,228 *
Granville E. Conway (7)............................. 102,729 *
Michael E. Gellert (8).............................. 208,446 1.6%
Andrew R. Morse (9)................................. 14,200 *
Stephen Stamas...................................... 1,000 *
Richard M. Fairbanks III............................ 18,000 *
Antoon W. Kienhuis (10)............................. ** **
Pierre de Demandolx................................. ** **
GeoCapital Corporation (11)
767 Fifth Avenue
New York, New York 10153............................ 699,400 5.3%
Alpine Capital L.P. (12)
201 Main Street, Suite 3100
Fort Worth, TX 76102................................ 979,200 7.4%
All directors, nominees and executive
officers as a group (13 Persons).................... 1,086,405 8.1%
</TABLE>
- ---------------------------------
* Less than 1.0%.
** Does not own any shares.
(1) Unless otherwise indicated, the address of each of the persons whose
name appears in the table above is: c/o SEACOR SMIT Inc., 11200
Westheimer, Suite 850, Houston, Texas 77042.
(2) The information contained in the table above reflects "beneficial
ownership" of the Common Stock within the meaning of Rule 13d-3 under
the Exchange Act. Unless otherwise indicated, all shares of Common Stock
are held directly with sole voting and dispositive power. Beneficial
ownership information reflected in the table above includes shares
issuable upon the exercise of outstanding stock options exercisable
within 60 days or upon conversion of the Company's 5 3/8% Convertible
Subordinated Notes due November 15, 2006 (the "5 3/8% Notes").
3
<PAGE>
(3) Includes 397,171 shares of Common Stock which Mr. Fabrikant may be
deemed to own through his interest in, and control of (i) Fabrikant
International Corporation ("FIC"), the record owner of 214,464 shares of
Common Stock, (ii) Fabrikant International Profit Sharing Trust (the
"Trust"), the record owner of 13,120 shares of Common Stock, and (iii)
SCF Corporation ("SCF"), the record owner of 169,587 shares of Common
Stock. Mr. Fabrikant is the President of FIC, a beneficiary of Fabrikant
International Profit Sharing Trust, and is the Chairman, Chief Executive
Officer and a 47% stockholder of SCF. Also includes 193,611 shares of
Common Stock issuable upon the exercise of options exercisable within 60
days and 12,470 shares of restricted stock over which Mr. Fabrikant
exercises sole voting power.
(4) Does not include 169,587 shares of Common Stock owned by SCF, of which
Mr. Blank serves as President and Chief Operating Officer and holds an
approximate 7% equity interest. Mr. Blank disclaims beneficial ownership
of such shares of the Company owned by SCF. Includes 52,000 shares of
Common Stock issuable upon the exercise of options exercisable within 60
days and 5,680 shares of restricted stock over which Mr. Blank exercises
sole voting power.
(5) Includes 20,000 shares of Common Stock issuable upon the exercise of
options exercisable within 60 days and 2,863 shares of restricted stock
over which Mr. Rose exercises sole voting power.
(6) Does not include 145,374 shares of Common Stock owned by Miller Family
Holdings, Inc., of which Mr. Miller owns an 8.2% interest. Mr. Miller
disclaims beneficial ownership of such shares. Includes 15,555 shares of
Common Stock issuable upon the exercise of options exercisable within 60
days and 900 shares of restricted stock over which Mr. Miller exercises
sole voting power.
(7) Does not include (i) shares of Common Stock owned by Mr. Conway's two
sons, G. Todd Conway and Bradley L. Conway (neither of whom are minors
or reside with Mr. Conway), (ii) an aggregate of 12,000 shares of Common
Stock owned by Mr. Conway's children, grandchildren and other relatives
(none of whom reside with Mr. Conway), and (iii) 169,587 shares of
Common Stock owned by SCF in which Mr. Conway owns an approximate 7%
equity interest, as to which Mr. Conway, in each case, disclaims
beneficial ownership.
(8) Includes 208,446 shares of Common Stock owned by Windcrest Partners,
L.P., of which Mr. Gellert is one of two general partners. Does not
include, and Mr. Gellert disclaims beneficial ownership of, 169,587
shares of Common Stock owned by SCF, of which Mr. Gellert is a Director
and in which Windcrest Partners, L.P. owns an approximate 17% equity
interest.
(9) Does not include 169,587 shares of Common Stock owned by SCF, of which
Mr. Morse holds an approximate 1% equity interest and is a Director. Mr.
Morse disclaims beneficial ownership of such shares.
(10) Does not include 231,060 shares of Common Stock issuable upon the
conversion of the Company's 5 3/8% Notes owned by Smit Overseas, of
which Mr. Kienhuis serves as Managing Director.
(11) Share ownership information with respect to GeoCapital Corporation
("GCC") was derived from GCC's Statement of Beneficial Ownership on
Schedule 13G filed with the Commission on February 18, 1998. Such
Statement of Beneficial Ownership does not disclose the identities of
the natural persons having voting and dispositive power over the shares
covered thereby and the Company has no independent knowledge of such
identities.
(12) Share ownership information with respect to Alpine Capital L.P.
("Alpine") was derived from Alpine's Statement of Beneficial Ownership
on Schedule 13D filed with the Commission on February 12, 1998. Such
Statement of Beneficial Ownership does not disclose the identities of
the natural persons having voting and dispositive power over the shares
covered thereby and the Company has no independent knowledge of such
identities.
SECTION 16(A) BENEFICIAL OWNERSHIP COMPLIANCE
Section 16(a) of the Exchange Act requires that each director and
executive officer of the Company and each person owning more than 10% of the
Common Stock report his or its initial ownership of the Common Stock and any
subsequent changes in that ownership to the Commission. The Company is required
to disclose in this Proxy Statement any late filings of such reports with
respect to the most recent fiscal year.
Based solely upon a review of copies of forms furnished to the Company
or written representations from certain reporting persons that no Forms 5 were
required, the Company believes that during the 1997 fiscal year all Section
16(a) filing requirements were satisfied.
4
<PAGE>
PROPOSAL NO. 1
--------------
ELECTION OF DIRECTORS
Pursuant to applicable Delaware law (the jurisdiction of incorporation
of the Company) and the Company's Restated Certificate of Incorporation (the
"Certificate of Incorporation"), the business and affairs of the Company are
managed by or under the direction of the Board. Generally, the Board oversees
the management of the Company's business operations and determines the corporate
policies and appoints the chief executive officer, chief financial officer and
other executive officers of the Company.
Pursuant to the Company's Amended and Restated By-laws currently in
effect (the "By-laws"), the number of directors constituting the Board shall be
no less than five or more than 11, as may be fixed from time to time by
resolution of the entire Board. The size of the Board is presently fixed at
eight members. Moreover, the By-laws provide that directors of the Company are
elected annually to serve until the next annual meeting of stockholders or until
their earlier resignation or removal. Accordingly, at the Meeting, eight
directors are to be elected to serve until the next annual meeting of
stockholders or until their respective successors are duly elected and
qualified. Except for Mr. Morse, all of the management nominees for director
named below are currently directors of the Company. Unless otherwise specified,
proxies will be voted FOR the election of each of the management nominees named
below. The Board does not expect that any of the nominees will be unable to
serve as a director. However, if for any reason one or more of the nominees is
unable to serve, proxies will be voted for such substitute nominees as the Board
may recommend unless otherwise specified in the proxy.
Set forth below is certain biographical information with respect to
each nominee for director:
<TABLE>
<CAPTION>
NAME AGE PRINCIPAL OCCUPATION DIRECTOR SINCE
- -------------------------------- ---------- ------------------------------------------------- ---------------------
<S> <C> <C> <C>
Charles Fabrikant 53 Chairman of the Board, President and December 1989
Chief Executive Officer of the Company
Granville E. Conway (1) (2) 70 President and Chief Executive Officer of December 1989
Cosmopolitan Shipping Co. Inc.
Andrew R. Morse 52 Senior Vice President of Salomon Smith Barney Proposed
Michael E. Gellert (2) 66 General Partner of Windcrest December 1989
Partners, L.P.
Stephen Stamas (1) 66 Chairman of the Greenwall Foundation December 1992
Richard M. Fairbanks III (1) 57 Managing Director, Center for April 1993
Strategic and International Studies
Pierre de Demandolx 57 Director, Compagnie Nationale de Navigation and April 1994
General Partner of DPH Conselis
Antoon Kienhuis 55 Vice President and Chief Financial Officer, April 1997
Smit Internationale NV
</TABLE>
- ----------------
(1) Member of the Audit Committee.
(2) Member of the Stock Option and Executive Compensation Committee.
5
<PAGE>
Charles Fabrikant has been Chairman of the Board and Chief Executive
Officer of SEACOR since December 1989, and has served as a director of SEACOR's
subsidiaries since December 1989. He has been President of SEACOR since October
1992. For more than the past five years, Mr. Fabrikant has been the Chairman of
the Board and Chief Executive Officer of SCF Corporation ("SCF") and President
of Fabrikant International Corporation ("FIC"), each a privately owned
corporation engaged in marine operations and investments. Each of SCF and FIC
may be deemed to be an affiliate of the Company. Mr. Fabrikant is a licensed
attorney admitted to practice in the State of New York and in the District of
Columbia.
Granville E. Conway is President and Chief Executive Officer of
Cosmopolitan Shipping Co. Inc. ("Cosmopolitan"). Mr. Conway has been employed by
Cosmopolitan since March 1950 and is a graduate of the U.S. Merchant Marine
Academy. Mr. Conway was President of the Company from December 1989 to October
1992. Mr. Conway has been a director of SEACOR since December 1989.
Michael E. Gellert has been one of two general partners of Windcrest
Partners, L.P., a New York limited partnership, for more than the past five
years. Mr. Gellert has been a director of SCF since 1984 and is currently a
director of the following public corporations: Premier Parks Inc. (Committees:
Audit), Devon Energy Corp. (Committees: Compensation), Humana Inc. (Committees:
Audit, Compensation, Investment, Executive), and Regal Cinemas, Inc.
(Committees: Compensation). and serves as a member of the Putnam Trust Company
Advisory Board to the Bank of New York. Mr. Gellert has been a director of
SEACOR since December 1989.
Stephen Stamas has been Chairman of the Greenwall Foundation since 1995
and of the American Assembly of Columbia University since 1987. He has been Vice
Chairman of the Rockefeller University since 1995. He served as the Chairman of
the New York Philharmonic from 1989 until 1996. He is also a director of BNY
Hamilton Funds, Inc. Mr. Stamas has been a director of SEACOR since December
1992. From 1973 to 1986, he served as a Corporate Vice President of Exxon
Corporation.
Richard M. Fairbanks III is currently Managing Director for Domestic
and International Issues at the Center for Strategic and International Studies
in Washington, D.C. From February 1992 until March 1994, he was Senior Counsel
in the Washington, D.C. office of Paul, Hastings, Janofsky & Walker (a law
partnership). From September 1985 to February 1992, he was Managing Partner of
that office. Mr. Fairbanks is also a director of Hercules Incorporated
(Committees: Audit, Nominating, Finance) and GATX Corporation (Committees:
Audit, Retirement Funds Review). He formerly served as an Ambassador-at-Large
for the United States and was International Chairman of the Pacific Economic
Cooperation Council. Mr. Fairbanks is admitted to practice law in the District
of Columbia and before the United States Supreme Court. Mr. Fairbanks has been a
director of SEACOR since April 1993.
Pierre de Demandolx is a Director of CNN, a Paris based public company
majority owned by Worms & Cie. until January 1998, and presently owned by
Compagnie Maritime Belge. He was the Chief Executive Officer of CNN from
September 1990 to June 1996. From July 1996 until October 1997, Mr. Demandolx
was the Chairman of the Board of Heli-Union, a Paris based helicopter
transportation company. From 1986 to January 1996, Mr. Demandolx was Chairman of
FISH and is currently a Director of FISH. He is the General Partner of DPH
Conselis, a consulting firm in transportation and energy created in 1996. Mr.
Demandolx has been a director of SEACOR since April 1994.
6
<PAGE>
Antoon W. Kienhuis is currently Vice President and Chief Financial
Officer of Smit Internationale N.V., a Netherlands corporation whose principal
business is maritime contracting, salvage and harbor operations ("Smit"), and
the Managing Director of Smit Overseas. Mr. Kienhuis has held several positions
with Smit since 1973. Mr. Kienhuis has been a director of SEACOR since April
1997.
Andrew R. Morse has been a Senior Vice President - Investments of
Salomon Smith Barney Inc in New York, and Smith Barney Inc., its predecessor,
for the past five years. He is the Senior Partner of Round Hill Associates, a
private investment partnership, and sits on numerous philanthropic boards. Mr.
Morse has been nominated to serve on the SEACOR Board of Directors.
Directors will be elected by a plurality of the shares of Common Stock
represented in person or by proxy at the Meeting. If you do not wish your shares
to be voted for any particular nominees, please identify those nominees for whom
you "withhold authority" to vote in the appropriate space provided on the
enclosed proxy.
THE BOARD RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE ELECTION OF EACH OF
THE DIRECTOR-NOMINEES NAMED ABOVE.
INFORMATION RELATING TO THE BOARD OF DIRECTORS AND
COMMITTEES THEREOF
MEETINGS
During the year ended December 31, 1997, the Board held four meetings
and acted by unanimous written consent on seven occasions. All of the Company's
directors attended at least 75% of the meetings of the Board and all committees
of the Board of which they are members.
COMMITTEES OF THE BOARD
AUDIT COMMITTEE
The functions of the Audit Committee are to recommend to the full Board
the firm to be appointed each year as independent auditors of the Company's
financial statements, to perform services related to the completion of such
audit, and to review affiliated transactions. The Audit Committee also has the
responsibility to (i) review the scope and results of the audit with the
independent auditors, (ii) review with management and the independent auditors
the Company's interim and year-end financial condition and results of
operations, (iii) consider the adequacy of the internal accounting, bookkeeping
and other control procedures of the Company, and (iv) review any non-audit
services and special engagements to be performed by the independent auditors and
consider the effect of such performance on the auditors' independence. The Audit
Committee is also responsible for reviewing at least once each year the terms of
all material proposals, transactions and arrangements between the Company and
its directors, officers, subsidiaries and affiliates. Messrs. Conway, Fairbanks
and Stamas, none of whom is an officer or other employee of the Company, serve
as members of the Audit Committee. The Audit Committee held two meetings during
1997.
7
<PAGE>
STOCK OPTION AND EXECUTIVE COMPENSATION COMMITTEE
The Stock Option and Executive Compensation Committee is responsible,
subject to the general terms and provisions of the SEACOR SMIT Inc. 1992
Non-Qualified Stock Option Plan (the "1992 Stock Option Plan") and the SEACOR
SMIT Inc. 1996 Share Incentive Plan (the "1996 Share Incentive Plan"), for the
administration and award of restricted stock and stock options under such plans.
In addition, in January 1993, the Board delegated to the committee
responsibility for all matters relating to the determination and award of
executive compensation. Messrs. Gellert and Conway, each of whom is a
"Non-Employee Director" within the meaning of Rule 16b-3(b) under the Exchange
Act with respect to the 1992 Stock Option Plan and the 1996 Share Incentive
Plan, serve as members of the Stock Option and Executive Compensation Committee.
The Stock Option and Executive Compensation Committee held two meetings during
1997.
NOMINATING COMMITTEE
The Company does not maintain a Nominating Committee.
COMPENSATION OF DIRECTORS
Directors of the Company who are officers receive no remuneration by
reason of such directorship and are not compensated for attending meetings of
the Board or standing committees thereof. Directors who are not officers of the
Company receive $1,500 for every regular Board meeting that they attend.
8
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain compensation information for the
Company's Chief Executive Officer and each of the four most highly compensated
executive officers of the Company (collectively, the "Named Executive Officers")
whose aggregate salary and bonus exceeded $100,000 for the fiscal year ended
December 31, 1997.
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
--------------------------------------- ----------------------------------------
# of
Other Annual Restricted Securities All Other
Compensation Stock Awards Underlying Compensation
Position (s) Year Salary ($) Bonus ($) ($)(1) ($)(2) Options ($)(3)
- ------------ ---- ---------- --------- ------------- ------------ ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Charles Fabrikant, 1997 400,000 500,000 - 187,118 7,500 4,750
Chairman of the Board, President, 1996 300,000 500,000 - 97,400 - 4,000
and Chief Executive Officer 1995 300,000 100,000 - 211,669 85,000 4,000
Randall Blank, 1997 280,000 200,000 - 93,559 2,000 4,750
Chief Financial Officer, 1996 235,000 190,000 - 30,438 - 3,818
Executive Vice President and 1995 195,000 20,000 - 79,500 14,500 3,900
Secretary
Mark Miller, (4) 1997 263,769 25,000 - - - 4,849
Vice President 1996 256,430 191,184 - 18,263 - 4,500
1995 228,482 31,500 - 23,850 - 4,500
Milton Rose, 1997 174,030 85,000 - 22,550 1,000 4,501
Vice President 1996 174,030 85,000 - 14,610 - 3,481
1995 174,030 - - 47,700 - 3,481
Andrew Strachan, 1997 200,000 45,500 - 196,842 1,000 33,673(6)
Vice President (5)
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Only includes the value of perquisites and other personal benefits
received by the Named Executive Officers which exceed in the aggregate,
for any Named Executive Officer, $50,000 or 10% of such individual's
combined salary and bonus reported herein.
(2) At December 31, 1997, Messrs. Fabrikant, Blank, Miller, Rose and
Strachan held 6,767, 2,500, 900, 1,440, and 3,000 shares of restricted
stock having a value of $407,712, $150,625, $54,225, $86,760, and
$180,750, respectively, based upon a closing price of $60.25 per share
of Common Stock on December 31, 1997. If cash dividends are paid by the
Corporation, holders of restricted stock are entitled to receive such
dividends whether or not the shares have vested. Each award of
restricted stock vests in three equal and consecutive annual
installments, commencing on the first anniversary of the date of award.
(3) "All Other Compensation" includes contributions made by the Company to
match pre-tax elective deferral contributions (included under Salary)
made by Messrs. Fabrikant, Blank and Rose under the SEACOR Savings
Plan, a defined contribution plan established by the Company effective
July 1, 1994 which meets the requirements of Section 401(k) of the
Internal Revenue Code of 1986, as amended (the "Code"). Mr. Miller's
amounts represent contributions made by NRC under a separate but
substantially similar plan established by NRC in 1993.
(4) In connection with the NRC Merger, the Company entered into an
employment agreement with Mr. Miller which determines his base salary.
See "-Employment Contracts and Other Arrangements." In 1996, $6,500 of
Mr. Miller's bonus was attributed to spill response profits for the
1995 calendar year, although this amount was not determined until 1996.
In 1997, $151,184 of Mr. Miller's bonus was attributed to spill
response profits for the 1996 calendar year, although this amount was
not determined until 1997. Mr. Miller's Spill Bonus for 1997, which
will be paid in 1998, has not been finalized and is not calculable
through the latest practicable date; therefore, it is not included in
the table above.
9
<PAGE>
(5) Mr. Strachan joined the Company in 1997.
(6) Mr. Strachan has previously established an individual savings
arrangement pursuant to which the Company will make supplemental
contributions during his employment. Amount includes $23,151 paid by the
Company under this arrangement and $10,522 paid to Smit as reimbursement
for continued coverage of Mr. Strachan under its retirement plans and
administrative costs, less certain reimbursements by the Netherlands
government. The Company anticipates that it will establish a new pension
arrangement with respect to Mr. Strachan in fiscal year 1998, and that
it will receive a transfer of assets from Smit to fund a portion of its
obligations thereunder.
STOCK OPTIONS
On November 22, 1992, the Company's stockholders adopted the 1992 Stock
Option Plan, which provides for the grant of non-qualified options to purchase
shares of Common Stock to officers and key employees of the Company. The 1992
Stock Option Plan is administered by the Stock Option and Executive Compensation
Committee of the Board. Each option granted to an officer or key employee must
be evidenced by an agreement (an "Option Agreement") containing terms and
provisions established by the Committee in accordance with the 1992 Stock Option
Plan.
On April 18, 1996 the Company's stockholders adopted the 1996 Share
Incentive Plan, which provides for the grant of stock options, stock
appreciation rights, restricted stock awards, performance awards and stock units
to officers and key employees of the Company. The 1996 Share Incentive Plan is
administered by the Stock Option and Executive Compensation Committee of the
Board. Each share granted to an officer or employee must be evidenced by an
agreement (a "Restricted Stock Agreement") containing terms and provisions
established by the Committee in accordance with the 1996 Share Incentive Plan.
OPTION GRANTS TABLE
On January 23, 1998, the Company granted options with respect to a
total of 18,150 shares of Common Stock under the 1996 Share Incentive Plan, none
of which are exercisable prior to January 31, 1999 and which expire not later
than January 23, 2008. The Option Agreements provide that the beneficial
ownership of the options shall vest in three equal and consecutive annual
installments, commencing on the January 31, 1999. However, 100% beneficial
ownership of the options shall vest immediately upon death, disability,
termination without "cause", as defined therein, or the occurrence of a
"change-in-control" of the Company, as defined therein. The following table sets
forth certain information with respect to the options granted to the Named
Executive Officers:
<TABLE>
<CAPTION>
Individual Grants
------------------------------------------------------------
Number of Potential Realizable
Securities Percent of Total Exercise Value at Assumed Annual
Underlying Options Granted of Base Rates of Stock Price
Options to Employees in Price Expiration Appreciation for Option
Name Granted Fiscal Year ($/Sh) Date Term
- ---- ------- ----------- ------ ---- ----
5% ($) 10% ($)
------ -------
<S> <C> <C> <C> <C> <C> <C>
Charles Fabrikant 7,500 41 53.00 1/23/08 249,986 633,513
Randall Blank 2,000 11 53.00 1/23/08 66,663 168,937
Milton Rose 1,000 6 53.00 1/23/08 33,331 84,468
Andrew G. Strachan 1,000 6 53.00 1/23/08 33,331 84,468
</TABLE>
10
<PAGE>
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUE TABLE
The following table sets forth certain information with respect to the
value of the options outstanding at year end based on a year-end closing price
of $60.25 per share. Options issued in 1998 as part of 1997 compensation are not
included in this table.
<TABLE>
<CAPTION>
Shares Value Number of Securities Value of Unexercised
Acquired Realized ($) Underlying Unexercised In-the-Money Options at
on Options at Fiscal Year-End (#) Fiscal Year-End ($)
Name Exercise Exercisable/Unexercisable Exercisable/Unexercisable
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Charles Fabrikant - - 193,611/ 0 8,209,301 / 0
Mark Miller - - 15,555 / 0 787,239 / 0
Randall Blank 20,000 940,000 52,000 / 0 2,291,750 / 0
Milton Rose - - 30,000 / 0 1,365,000 / 0
Andrew Strachan - - 0 / 0 0 / 0
</TABLE>
RESTRICTED STOCK AWARDS
Mr. Fabrikant was granted restricted stock awards of 2,000, 1,600 and
3,510 shares of Common Stock pursuant to Restricted Stock Agreements between the
Company and Mr. Fabrikant dated May 7, 1996, January 27, 1997 and February 5,
1998, respectively.
Mr. Blank was granted restricted stock awards of 2,000, 500 and 1,755
shares of Common Stock pursuant to Restricted Stock Agreements between the
Company and Mr. Blank dated May 7, 1996, January 27, 1997 and February 5, 1998,
respectively.
Mr. Rose was granted restricted stock awards of 1,200, 240 and 423
shares of Common Stock pursuant to Restricted Stock Agreements between the
Company and Mr. Rose dated May 7, 1996, January 27, 1997 and February 5, 1998,
respectively.
Mr. Strachan was granted restricted stock awards of 3,000 and 228
shares of Common Stock pursuant to Restricted Stock Agreements between the
Company and Mr. Strachan dated January 27, 1997 and February 5, 1998,
respectively.
Mr. Miller was granted restricted stock awards of 600 and 300 shares of
Common Stock pursuant to Restricted Stock Agreements between the Company and Mr.
Miller dated May 7, 1996 and January 27, 1997, respectively.
The Restricted Stock Agreements provide that the beneficial ownership
of the restricted shares shall vest in three equal and consecutive annual
installments, commencing on the first anniversary date of the Restricted Stock
Agreement. However, 100% beneficial ownership of the restricted shares shall
vest immediately upon death, disability, termination without "cause", or the
occurrence of a "change-in-control" of the Company.
EMPLOYMENT CONTRACTS AND OTHER ARRANGEMENTS
The Company has entered into employment contracts and other
arrangements with Mr. Miller, dated March 14, 1995 (the "Miller Employment
Agreement") and Mr. Rose, dated December 24, 1992 (the "Rose Employment
Agreement"). The Company has also entered into an arrangement with Mr. Strachan,
which has not been documented in a formal written employment agreement (the
"Strachan Arrangement").
11
<PAGE>
The Miller Employment Agreement provides for a base salary of $250,000
per year for five years, subject to adjustment for inflation, and a bonus, for a
period of three years commencing on January 1, 1995, determined by reference to
NRC's annual profits from its spill response services, subject to certain
minimum NRC net income requirements. Additionally, Mr. Miller is eligible for an
annual bonus based upon NRC's regular bonus program for key executives.
Mr. Miller has agreed, with certain exceptions, that during the term of
his employment and for the period ending on the fifth anniversary date of
termination of such employment, he will not, directly or indirectly, (i) engage
in, represent, provide consulting services to, become an employee of, or have
any financial, pecuniary or management interest in, any national or regional
offshore and open-ocean environmental level "E" Oil Spill Removal Organization
that competes or otherwise engages in the businesses conducted by NRC and its
subsidiaries or (ii) disclose to any third party, make public, or otherwise
appropriate for a purpose not in furtherance of NRC's business, any proprietary
or confidential information or trade secrets acquired by or made known to him in
respect of NRC and its subsidiaries.
The Miller Employment Agreement entitles Mr. Miller to participate in
all retirement, pension, incentive and bonus plans generally made available to
NRC's executive officers, and in the event that Mr. Miller's employment is
terminated: (i) due to his "Disability" or for "Cause" (as defined), he is
entitled to receive through March 14, 2000: (a) 40% of his Base Salary and
Annual Bonus at the rates therefor in effect on the date of his termination
(less the amount of any disability insurance benefits which Mr. Miller receives
under policies maintained by NRC), (b) any accrued and unpaid Annual Bonus, (c)
all plan benefits to which Mr. Miller is entitled (to the extent applicable
following his Disability), and (d) reimbursement for certain expenses incurred
by him in his employment capacity or (ii) due to his death, he is entitled to
receive all payments referred to in (a), (b) and (d) of clause (i) above.
The Rose Employment Agreement provides for an annual salary of
$165,000, subject to adjustment for inflation, and for the grant of an option
for 50,000 shares of Common Stock. The initial term of the Rose Employment
Agreement was two years commencing on January 25, 1993. Since January 25, 1995,
the Rose Employment Agreement has been subject to automatic renewal for one-year
periods unless either party gives 180 days' written notice of termination to the
other party. No such notice has been given to date and, accordingly, the terms
of the Rose Employment Agreement remain in effect. In the event of a change in
control of the Company (as defined in the Rose Employment Agreement), Mr. Rose
has the option of a one-time extension of the Rose Employment Agreement for a
three-year period.
In the event Mr. Rose's employment is terminated because (i) he is
discharged by the Company for reasons other than for "Cause" (as defined
therein), (ii) he involuntarily resigns at the request of the Company, for
reasons other than for Cause, or (iii) he resigns following the assignment of
duties which are inconsistent with employment in the capacity of a president of
a subsidiary of a Company, he then is entitled to receive a one-time severance
payment equal to his base salary (excluding bonuses and incentive compensation)
for a period of 12 months after the occurrence of any such event.
12
<PAGE>
In addition, subject to certain limitations, the Rose Employment
Agreement specifies that the Company must continue to provide any then-existing
life and health insurance benefits to which Mr. Rose, through the Rose
Employment Agreement, and his respective dependents are entitled for a period of
one year after the termination of his employment or until he obtains other
employment pursuant to which comparable life and health insurance benefits are
provided.
The Board may reduce any amount payable under the Rose Employment
Agreement if it determines that all or any portion of the amount payable
pursuant thereto may be treated as an "excess parachute payment" as defined in
Section 280G of the Code. Furthermore, the Rose Employment Agreement, by its
terms, is binding upon any person or entity which acquires the Company, whether
by means of merger, consolidation, the purchase of all or substantially all of
the Company's assets, or otherwise.
Pursuant to the Strachan Arrangement, Mr. Strachan will receive a
salary of $200,000 per year, to be reviewed semi-annually, for a period of three
years beginning January 1, 1997. The Strachan Arrangement also provides
participation in Company medical and retirement plans made available to European
nationals employed in EEU locations and for reimbursement of certain housing,
living, automobile lease and other expenses. The Strachan Arrangement is
terminable upon 30 days written notice.
Except as set forth above with respect to Messrs. Miller, Rose and
Strachan, the Company has no employment contracts or formal remuneration
arrangements with any of the Named Executive Officers.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
MANAGEMENT SERVICES AGREEMENT
Messrs. Fabrikant and Blank serve as Chairman and Chief Executive
Officer, and President and Chief Operating Officer, respectively, of SCF. Since
January 1, 1990, the Company and SCF have been operating under an agreement (the
"Management Services Agreement") with an initial expiration date of January 1,
1993 (subject to automatic renewal for successive one-year periods unless
terminated by either party upon at least 60 days notice) pursuant to which SCF
provides the Company with certain administrative services. Effective January 1,
1993, the Management Services Agreement was amended such that the services
provided by SCF now include the use of SCF offices, equipment and access to SCF
administrative and technical personnel, for which the Company pays SCF a fee of
$175,000 per annum (together with reimbursement for out-of-pocket expenses),
subject to adjustment by the parties. The amendment also extended the stated
expiration date of the Management Services Agreement from January 1, 1993 to
January 1, 1996 with successive one year renewal options as described above.
ENVIRONMENTAL CONTRACTING SERVICES
Miller Environmental Group ("MEG"), an environmental contractor based
in Calverton, NY, 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 1997, NRC paid approximately $0.4
million to MEG for these services. Mark Miller's father, Mr. James Miller, is
Vice President, Secretary, and Treasurer of MEG.
13
<PAGE>
NRC also contracts with James Miller Marine Service ("JMMS"), an
environmental contractor based in Staten Island, NY, for services similar to
those provided by MEG. In fiscal 1997, NRC paid approximately $0.6 million to
JMMS for these services. Mark Miller's brother, Mr. Glen Miller, is Vice
President of JMMS.
COMMON STOCK REPURCHASE
On March 3, 1998, the Company repurchased from SMIT International
Overseas B.V. ("SMIT Overseas"), a subsidiary of SMIT Internationale N.V.
("SMIT"), the owner of 6.7% of the Company's Common Stock, 712,000 shares of
SEACOR's Common Stock for approximately $37.0 million. The Common Stock was
issued to SMIT Overseas as part of the purchase consideration paid for the
Company's acquisition of SMIT's offshore supply vessel fleet in December 1996.
The Company also satisfied its obligation to pay up to an additional $47.2
million of purchase consideration that would otherwise be payable to SMIT in
1999 through the payment to SMIT of $20.88 million in cash and, through the
commitment to issue in January 1999, $23.2 million principal amount of five-year
unsecured promissory notes that will bear interest at 90 basis points above the
comparable rate for five year U.S. Treasury Notes. As part of this transaction,
the Company and SMIT also have agreed to extend the three year term of the
salvage and maritime contracting and non-compete agreements first established in
December 1996 through December 2001.
CHILES OFFSHORE LLC
During 1997 the Company made certain investments in Chiles Offshore LLC
("Chiles"), a consolidated subsidiary of the Company. Mr. Richard Fairbanks III,
a director of the Company, and members of his immediate family, own direct and
indirect interests in Chiles. Mr. Fairbanks and his wife together own
approximately 5.0% of the membership interests in Chiles (approximately 1.5%
directly and 3.5% indirectly) and their son, Jonathan Fairbanks, owns indirectly
approximately 2.8% of the membership interests in Chiles. Mr. and Mrs. Fairbanks
made their indirect investment before the Company's investment in Chiles and
made an additional investment of $1.0 million simultaneously with the Company's
investment in Chiles. Mr. Fairbanks' son also holds his interests through
entities that invested prior to and simultaneously with the Company. In
addition, Mr. Fabrikant and Mr. Gellert each invested $500,000, and Mr. Blank
and Mr. Strachan invested $75,000 and $50,000, respectively, in Chiles'
membership interests simultaneously with the Company's investment. Subsequent to
such investments, each of Messrs. Fabrikant, Gellert, Blank and Strachan holds
less than one percent of Chiles' membership interests.
RELATIONSHIP WITH INVESTMENT BANKING FIRM
Andrew R. Morse, a nominee for director of the Company, served in 1997
as a Senior Vice President -- Investments of Salomon Smith Barney Inc, the
successor to Salomon Brothers Inc. Salomon Brothers Inc performed financial
advisory and investment banking services for the Company during 1997
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Gellert and Conway serve as members of the Stock Option and
Executive Compensation Committee. Mr. Conway was President of the Company from
December 1989 to October 1992.
14
<PAGE>
REPORT ON EXECUTIVE COMPENSATION
GENERAL
In January 1993, the Board delegated responsibility for all matters
relating to the determination and award of executive compensation to the Stock
Option and Executive Compensation Committee (the "Committee"). The Committee is
currently comprised of Messrs. Gellert and Conway. From January 1993 until
September 1995, the Committee was comprised of Mr. Gellert and Thomas J.
Gallagher, a former director of the Company who resigned in September 1995. The
Committee met officially on two occasions and, in addition, had several informal
meetings during 1997 to discuss each option grant, to assess executive
compensation policy, to review and approve compensation to the executive
officers of the Company for the fiscal year ended December 31, 1997 and to
discuss the Company's executive compensation policies and objectives for the
forthcoming year.
The Company's compensation program is designed to attract, retain and
motivate highly qualified management personnel, and to engender a sense of
compensatory certainty and entrepreneurial commitment among its executive
officers. The Company's compensation philosophy is to provide levels of
compensation competitive with comparable companies in the industry, to reward
individual initiative and achievement, and to ensure that the amount and nature
of executive compensation is reasonably commensurate with the Company's
financial condition, results of operations, Common Stock performance, and the
executive compensation programs of the Company's competitors. The Company's
executive compensation program consists of three central components: (1) base
salary, (2) discretionary annual bonuses, and (3) awards of restricted stock and
grants of stock options. Factors reviewed by the Committee in establishing the
Company's executive compensation program included the Company's financial
performance, total assets and services provided, management's business
philosophy, industry practices and the Company's culture and organizational
structure. While the foregoing provides the general intent and guidelines of the
Committee in determining the compensation levels and components for the
executive officers, the Committee has final authority to determine all
compensation matters in its sole discretion.
In order to further the Company's compensation philosophy and augment
its existing share award program, the Committee recommended to the full Board of
Directors approval of the 1996 Share Incentive Plan, which was approved by
stockholders at the 1996 Annual Meeting, and increased the Company's flexibility
to provide additional forms of incentive based awards to its executive officers
and key employees.
BASE SALARY
The salaries of Messrs. Miller, Rose and Strachan were paid in
accordance with the provisions of their respective employment agreements or
other arrangements.
In respect of Messrs. Fabrikant and Blank, 1997 salary increases
primarily reflect their roles in significantly expanding the Company's business
through acquisitions, the development of new business relationships, a measured
program of fleet upgrades and new construction and disposition of vessels. On an
individual basis, their respective salaries are a function of their experience,
breadth of responsibilities, ability to manage a complex administrative and
financial structure, and are generally consistent with comparable companies in
the industry.
15
<PAGE>
ANNUAL BONUS
The bonus portion of the executive compensation package is directly
related to the individuals' and the Company's performance during the year. Bonus
payments are discretionary in nature and are tied to performance during the year
in which they were earned. The Company believes that, to the extent that the
bonus awards reward the executives in a fair and equitable way, they may also
provide an incentive for their continued efforts and for enhanced future
performance.
Specific performance targets are set at the beginning of the year based
on the Company's annual forecasts, focusing on operating revenue, net income and
cash flow (EBITDA basis) and the achievement of strategic objectives. However,
given the Company's history of growth through mergers, acquisitions, and asset
purchases and market conditions for the marine segment which are beyond
management's control, the Company's actual results can differ greatly from
management's forecasts and the Committee must re-evaluate the targets set at the
beginning of the year. 1997, for instance, was a year of expansion and growth.
The Company realized approximately 54.6%, 248.9%, and 74.6% increases in
operating revenue, net income, and cash flow from operations, respectively, for
the Company's fiscal year ended December 31, 1997. Facilitating this growth, the
Company successfully integrated the operations of the acquisitions it had
completed in the prior year and early 1997. From a strategic perspective, the
Company significantly improved the age profile and quality of its fleet through
a program of selective disposition and new construction of vessels.
In related matters, the Company made a significant investment in Chiles
Offshore LLC for the purpose of building and operating two premium jackup
drilling rigs and completed a private placement of $150.0 million of 7.2% Notes
due 2009. In connection with the 7.2% Notes Offering the Company improved its
debt rating. On the environmental side, the Company expanded its service
offerings through the acquisition of ERST/O'Brien's Inc.
The foregoing financial and operating growth of the Company was
attributed by the Committee, in large part, to the efforts of the Named
Executive Officers, and therefore was considered when determining such persons'
annual bonuses.
COMMON STOCK AWARDS AND GRANTS
The purpose of restricted stock awards and stock option grants is to
reward outstanding performance by key employees and officers, to provide
additional incentives to executive officers and other key employees to maximize
stockholder value, and to create longer term executive commitment to the
Company. The Committee believes that such grants and awards foster a greater
concern by management with the performance of the Company, both in the short and
long-term, which serves to align the interests of management and the Company's
stockholders. The number of shares awarded or granted reflect a judgment on the
individual's performance to date, as well as on the executive's ability to
influence and enhance the Company's future performance.
Restricted stock awards granted for 1997 reflect the Committee's belief
that the interests of the Company's stockholders are best served by ensuring
that senior management is dedicated to maximizing shareholder value. Mr.
Fabrikant was expressly recognized for his leadership role in the Company's
development and his ability to continue to influence the direction of the
Company towards maximizing shareholder value.
16
<PAGE>
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
In 1997, Mr. Fabrikant received total cash compensation (in the form of
salary and bonus) of $900,000 from the Company. Additionally, he was granted
3,510 shares of restricted stock and options on 7,500 shares of stock. These
grants were made on January 23, 1998 and February 5, 1998, respectively, and
vest over three years. The determination of Mr. Fabrikant's compensation was
based upon the factors described above with respect to all executive officers,
and, in addition, upon Mr. Fabrikant's extensive experience, leadership and
reputation within both the offshore marine and environmental services industries
and his leadership role in the Company's strong development. Mr. Fabrikant
played an instrumental role in the strategic direction of each of the Company's
operating segments and the positioning of the Company's assets to take advantage
of long-term growth opportunities.
The foregoing report is respectfully submitted by the Stock Option and
Executive Compensation Committee:
Michael E. Gellert, Granville E. Conway
PERFORMANCE GRAPH
Set forth in the graph below is a comparison of the total return that a
hypothetical investor would have earned assuming the investment of $100 on
December 31, 1992 in (i) the Common Stock of the Company, (ii) the NASDAQ Stock
Market Index for all US companies ("NASDAQ"), (iii) the S&P 500 Index ("S&P
500") and (iv) an index of oil service companies published by Simmons and
Company, Inc. (the "Simmons Index"). The Company ceased trading on the NASDAQ
National Market on October 22, 1996 and began trading on the New York Stock
Exchange on October 23, 1996.
[SET FORTH BELOW IS A TABULAR DATA DESCRIPTION OF THE PERFORMANCE GRAPH
WHICH IS OMITTED PURSUANT TO RULE 304 OF REGULATION S-T.]
<TABLE>
<CAPTION>
12/31/92 12/31/93 12/30/94 12/29/95 12/31/96 12/31/97
-------- -------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Simmons Index 100 161 152 203 399 584
Seacor Smit Inc. 100 161 113 157 757 685
S&P 500 100 107 105 141 170 223
NASDAQ 100 115 111 155 191 232
</TABLE>
Each of the companies included in the Simmons Index is engaged
primarily in providing support or transportation services to the offshore oil
and gas exploration and development industry. The inclusion of the Simmons Index
to the performance graph reflects the determination by management that the stock
performance of the companies included in the Simmons Index form a more accurate
basis of comparison against which to judge the Company's performance than does a
broader index, such as the S&P 500, which includes a variety of diversified
companies involved in industries entirely unrelated to that of the Company.
The Simmons Index is weighted based on the market capitalization of
each individual company within that index at the beginning of each period. All
dividends paid during each period are assumed to have been reinvested.
Shareholder returns reflected in the performance graph are not necessarily
indicative of future performance.
17
<PAGE>
PROPOSAL NO. 2
--------------
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board recommends that stockholders ratify the appointment of Arthur
Andersen LLP ("Arthur Andersen"), certified public accountants, as independent
auditors to audit the accounts of the Company and its subsidiaries for the
fiscal year ending December 31, 1998. The appointment of Arthur Andersen was
recommended to the Board by its Audit Committee. Arthur Andersen served as
independent auditor for the Company for the fiscal year ended December 31, 1997
and has been engaged by the Company since December 1989.
Representatives of Arthur Andersen will be present at the Meeting. They
will have an opportunity to make a statement if they desire to do so and will be
available to respond to stockholder questions after the conclusion of the
Meeting.
The affirmative vote of a majority of the Common Stock represented in
person or by proxy at the Meeting is required to ratify the appointment of
Arthur Andersen.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE RATIFICATION OF
THE APPOINTMENT OF ARTHUR ANDERSEN TO SERVE AS THE COMPANY'S INDEPENDENT
AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31, 1998.
OTHER MATTERS
LIMITATION ON STOCKHOLDER ACTION BY WRITTEN CONSENT; SPECIAL MEETINGS OF
STOCKHOLDERS; REMOVAL OF DIRECTORS; VACANCIES
The Restated Certificate of Incorporation provides that no action may
be taken by stockholders except at an annual or special meeting of stockholders
or by the affirmative written consent of the holders of not less than 66 2/3%
(or such greater percentage as may then be required by applicable law) in voting
power of the outstanding shares of Common Stock entitled to vote thereon. The
By-laws provide that, to be properly brought before an annual meeting, business
must be (i) specified in the notice of meeting and (ii) brought before the
meeting by or at the direction of the Board, or be brought before the meeting by
a stockholder upon timely written notice in proper form given to the Secretary
of the Company. In order to be considered timely, such stockholder notice must
be received by the Secretary of the Company not less than 90 days prior to the
anniversary of the date of the annual meeting of stockholders held in the
previous year, subject to certain exceptions. The By-laws further provide that,
unless otherwise prescribed by law, special meetings of stockholders can only be
called by the Chairman of the Board, the President or pursuant to a resolution
approved by a majority of the Board, and, in any such case, only to consider
such business as shall be provided in such resolution or in the notice delivered
to stockholders respecting the special meeting.
The By-laws also provide that directors of the Company can be removed
from office (prior to the expiration of their term) with or without "cause" by
the affirmative vote of a majority in voting power of the outstanding shares
entitled to vote at an election of directors, and that vacancies on the Board
can be filled only by the remaining directors then in office.
18
<PAGE>
STOCKHOLDER NOMINATION OF DIRECTORS
The By-laws establish an advance notice procedure with regard to the
nomination (other than by or at the direction of the Board or a committee
thereof) of candidates for election as directors (the "Nomination Procedure").
Only persons who are nominated by the Board, a committee appointed by the Board,
or by a stockholder who has given timely prior written notice to the Secretary
of the Company prior to the meeting at which directors are to be elected, are
eligible for election as directors of the Company. In order to be timely, such
written notice must be received by the Secretary of the Company not less than 90
days prior to the anniversary of the date of the immediately preceding annual
meeting (subject to certain exceptions), and the notice must contain (i) the
name and address of the stockholder who intends to make the nomination and the
name and address of the person or persons to be nominated, (ii) a representation
that the stockholder is a holder of record of Common Stock entitled to vote at
such meeting and intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice, (iii) a description of
all contracts, arrangements or other understandings between the stockholder and
each nominee and any other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by the
stockholder, (iv) such other information regarding each nominee proposed by such
stockholder as would be required to be included in a proxy or information
statement filed pursuant to the Exchange Act, and (v) the consent of each
nominee to serve as a director of the Company if so elected. The presiding
officer of the meeting may refuse to acknowledge the foregoing nomination of any
person not made in compliance with the Nomination Procedure.
Although the By-laws do not empower the Board with the right to approve
or disapprove of stockholder nominations for the election of directors or any
other business properly brought by the Company's stockholders at any annual or
special meeting, the foregoing Nomination Procedure may nevertheless have the
effect of (i) precluding a nomination for the election of directors or
precluding the transaction of business at a particular meeting if the proper
procedures are not followed, or (ii) deterring a third party from conducting a
solicitation of proxies or contest to elect his or its own slate of director
nominees or otherwise attempting to obtain control of the Company.
RESTRICTIONS ON FOREIGN OWNERSHIP OF COMMON STOCK AND RELATED MATTERS
The Company is subject to a variety of U.S. federal statutes and
regulations, including the Shipping Act, 1916, as amended (the "Shipping Act"),
and the Merchant Marine Act of 1920, as amended (the "1920 Act," and
collectively 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.
Generally, the Acts require that vessels which are engaged in U.S.
coastwise trade must be owned by citizens of the U.S. In order for a corporation
operating in U.S. coastwise trade to qualify as a U.S. citizen, at least 75% of
the outstanding capital stock of the corporation must be owned by persons or
organizations that are U.S. citizens, as defined in the Shipping Act.
Accordingly, if persons or organizations that are not U.S. citizens as so
defined ("Foreigners") were to own more than 25% of the Common Stock, the
Company would not (until such Foreign ownership was reduced to or below 25%) be
permitted to continue its U.S. coastwise trade operations. To help facilitate
compliance with the Acts, the Restated Certificate of Incorporation requires the
Company to institute and to implement through the transfer agent for the Common
Stock a dual stock certificate system, pursuant to which certificates evidencing
shares of Common Stock bear legends which, among other things, designate such
certificates as either "foreign" or "domestic," depending on the citizenship of
the owner. The Restated Certificate of Incorporation also establishes procedures
designed to enable the Company to monitor and limit foreign ownership of the
Common Stock, and authorizes the Board under certain circumstances to redeem
shares of stock owned by Foreigners.
19
<PAGE>
Moreover, the By-laws provide that the Chairman of the Board and Chief
Executive Officer, and the President must each be U.S. citizens, and restrict
any officer who is not a U.S. citizen from acting in the absence or disability
of such person. The By-laws further 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.
ANNUAL REPORT
A copy of the Company's Annual Report to Stockholders for the fiscal
year ended December 31, 1997 accompanies this Proxy Statement and should be read
in conjunction herewith.
STOCKHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
In accordance with the rules of the Commission, any proposal of a
stockholder intended to be presented at the Company's annual meeting of
stockholders to be held in 1999 must be received by the Company no later than
November 16, 1998 to be eligible for inclusion in the Proxy Statement for such
meeting. Proposals should be addressed to the Secretary of the Company.
For the Board of Directors
/s/ Randall Blank
Randall Blank
Executive Vice President,
Chief Financial Officer and Secretary
20
<PAGE>
PROXY PROXY
SEACOR SMIT INC., 11200 WESTHEIMER, SUITE 850, HOUSTON, TEXAS 77042
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS ON JUNE 1, 1998
The undersigned having received the Notice of Meeting and Proxy
Statement of SEACOR SMIT Inc. (the "Company") dated April 8, 1998 and Annual
Report for the fiscal year ended December 31, 1997, hereby appoints and
constitutes Messrs. Charles Fabrikant and Randall Blank, and each of them,
proxies with full power of substitution to vote for the undersigned at the
Company's Annual Meeting of Stockholders to be held on June 1, 1998, and at any
adjournments thereof (the "Annual Meeting"), as follows:
THIS PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS OF SEACOR SMIT INC.
IMPORTANT - THIS PROXY MUST BE SIGNED AND
DATED ON THE REVERSE SIDE.
SEACOR SMIT INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER
USING DARK INK ONLY [X]
[ ]
PROXY
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
ITEMS 1 AND 2. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR ALL MANAGEMENT NOMINEES
LISTED AND FOR ITEM NO. 2.
1. ELECTION OF DIRECTORS -- For Withhold For All
All All Except
Nominees: Charles Fabrikant, Granville E. [__] [__] [__]
Conway, Michael E. Gellert,
Stephen Stamas, Richard M. Fairbanks,
III, Pierre de Demandol, Antoon
Kienhuis, Andrew R. Morse
INSTRUCTIONS: To withhold authority to vote for any
one or more management nominee, write the nominee's
name.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED BY THE MANNER DIRECTED THEREIN
BY THE UNDERSIGNED, IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL
MANAGEMENT NOMINEES LISTED AND FOR PROPOSAL NO. 2.
<PAGE>
2. Ratification of the appointment of Arthur
Andersen LLP. For Against Abstain
[__] [__] [__]
In their discretion, upon any other matters which may properly come before the
Annual Meeting or any adjournments thereof, hereby revoking any proxy heretofore
given by the undersigned for the Annual Meeting.
Dated: , 1998
--------------------------
Signature(s)
---------------------------------------
---------------------------------------------------
Please sign name as it appears hereon. When signed
as attorney, executor, trustee or guardian, please
add capacity in which signed. For joint or
co-owner, each owner should sign.
