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 7, 1999
Dear Stockholder:
You are cordially invited to attend the 1999 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 Tuesday, May 18, 1999 at 2:00 p.m., local time. All holders of
record of the Company's outstanding common stock at the close of business on
April 2, 1999 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
SEACOR SMIT INC.
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 18, 1999
----------------
April 7, 1999
To Our Stockholders:
The Annual Meeting of Stockholders of SEACOR SMIT Inc. (the "Company"),
will be held on Tuesday, May 18, 1999, at 2:00 p.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 2000 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,
1999. Please see page 15.
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 2, 1999 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
MAY 18, 1999
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 Tuesday, May 18,
1999 (the "Meeting") and at any adjournments thereof. This Proxy Statement and
the enclosed proxy are first being mailed to stockholders on April 7, 1999.
VOTING
The Board of Directors has fixed the close of business on April 2, 1999
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 12,149,524 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 ten 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
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, 1999 under
"Proposal No. 2 - Ratification of Appointment of Independent Auditors" in this
Proxy Statement and listed under Item 2 of the enclosed proxy. 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.
<PAGE>
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.
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 (14 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) 624,503 5.1%
Randall Blank (4) 54,773 *
Milton Rose (5) 25,697 *
Mark Miller (6) 33,381 *
Andrew G. Strachan (7) 8,812 *
Alice N. Gran (8) 4,034 *
Granville E. Conway (9) 94,729 *
Michael E. Gellert (10) 208,446 1.7%
2
<PAGE>
Amount and Nature of
Beneficial Owner (1) Beneficial Ownership (2) Percentage of Class
- ------------------------------------------------------ ----------------------------- -----------------------------
Andrew R. Morse (11) 14,200 *
Stephen Stamas 1,000 *
Richard M. Fairbanks III 18,000 *
Antoon W. Kienhuis (12) ** **
Pierre de Demandolx ** **
GeoCapital Corporation (13) 903,400 7.4%
767 Fifth Avenue
New York, New York 10153
Baron Capital (14) 1,756,300 14.5%
767 Fifth Avenue
New York, New York 10153
Franklin Mutual Advisers, Inc. (15) 1,180,250 9.7%
51 John F. Kennedy Parkway
Short Hills, NJ 07078
Alpine Capital L.P., Algenpar, Inc., J. Taylor 2,270,700 (16) 18.7%
Crandall, The Anne T. and Robert M. Bass Foundation,
Anne T. Bass, Keystone, Inc., Robert M. Bass
201 Main Street, Suite 3100
Fort Worth, TX 76102
Robert W. Bruce III
P.O. Box 252
South Salem, NY 10590
The Robert Bruce Management Company, Inc. Defined
Benefit Pension Trust
96 Spring Street
South Salem, NY 10590
All directors, nominees and executive officers as a 1,099,103 8.8%
group (14 Persons)
</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) 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 196,111 shares of
Common Stock issuable upon the exercise of options exercisable within 60
days and 20,073 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 37,666 shares of
3
<PAGE>
Common Stock issuable upon the exercise of options exercisable within 60
days and 5,786 shares of restricted stock over which Mr. Blank exercises
sole voting power.
(5) Includes 20,334 shares of Common Stock issuable upon the exercise of
options exercisable within 60 days and 1,862 shares of restricted stock
over which Mr. Rose exercises sole voting power.
(6) Does not include 120,374 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 100 shares of restricted stock over which Mr. Miller exercises
sole voting power.
(7) Includes 334 shares of Common Stock issuable upon the exercise of
options exercisable within 60 days and 1,402 shares of restricted stock
over which Mr. Strachan exercises sole voting power.
(8) Includes 334 shares of Common Stock issuable upon the exercise of
options exercisable within 60 days and 3,200 shares of restricted stock
over which Ms. Gran exercises sole voting power.
(9) 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 20,000 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.
(10) 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.
(11) 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.
(12) Does not include 231,060 shares of Common Stock issuable upon the
conversion of the Company's 5 3/8% Notes owned by Smit Internationale
Overseas B.V., of which Mr. Kienhuis serves as Managing Director.
(13) Share ownership information with respect to GeoCapital Corporation
("GCC") was derived from GCC's Statement of Beneficial Ownership on
Schedule 13G filed with the Securities and Exchange Commission
("Commission") on February 10, 1999. 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.
(14) Share ownership information with respect to Baron Capital, Inc.
("Baron") was derived from Baron's Statement of Beneficial Ownership on
Schedule 13G filed with the Commission on March 22, 1999. 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.
(15) Share ownership information with respect to Franklin Mutual Advisers,
Inc. ("Franklin") was derived from Franklin's Statement of Beneficial
Ownership on Schedule 13G filed with the Commission on January 29, 1999.
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.
(16) Reflects shares beneficially owned as of December 2, 1998, according to
a statement on Schedule 13D filed with the Commission. As reported in
the 13D, Alpine Capital, L.P. holds sole voting and dispositive power
with respect to 1,305,000 shares; Keystone, Inc. holds sole voting power
with respect to 762,500 shares; The Robert Bruce Management Company,
Inc. Defined Benefit Pension Trust holds sole voting and dispositive
power with respect to 9,000 shares; Robert W. Bruce III holds sole
voting and dispositive power with respect to 9,000 shares and shared
voting and dispositive power with respect to 1,403,000 shares; Robert M.
Bass holds sole voting and dispositive power with respect to 858,700
shares and shared voting and dispositive power with respect to 98,000
shares; Algenpar, Inc. holds shared voting and dispositive power with
respect to 1,305,000 shares; J. Taylor Crandall holds shared voting and
dispositive power with respect to 1,403,000 shares; and Anne T. Bass and
The Anne T. and Robert M. Bass Foundation each hold shared voting and
dispositive power with respect to 98,000 shares.
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 Securities and Exchange Commission.
4
<PAGE>
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 1998 fiscal year all Section
16(a) filing requirements were satisfied, except that one report for one
transaction, involving a charitable gift of 2,500 shares, was filed late on
behalf of Mr. Fabrikant.
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 nor more than eleven, 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. 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. 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 54 Chairman of the Board, President and December 1989
Chief Executive Officer of the Company
Granville E. Conway (1) (2) 71 President and Chief Executive Officer of December 1989
Cosmopolitan Shipping Co. Inc.
Andrew R. Morse 53 Senior Vice President of Salomon Smith Barney June 1998
Michael E. Gellert (1) 67 General Partner of Windcrest Partners, L.P. December 1989
Stephen Stamas (2) 67 Chairman of the Greenwall Foundation December 1992
Richard M. Fairbanks III (1) 58 Managing Director, Center for Strategic and April 1993
International Studies
Pierre de Demandolx 58 Director, Compagnie Nationale de Navigation and April 1994
General Partner of DPH Conselis
Antoon Kienhuis 56 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 certain
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"), a company primarily engaged in
ship management. 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 investment 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, Compensation and Executive), Devon Energy Corp. (Committees: Compensation
and Stock Option), Humana Inc. (Committees: Audit, Compensation, Investment,
Executive), Smith Barney World Funds, 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, a private
charitable foundation, since 1995 and of the American Assembly of Columbia
University, a not-for-profit organization involved in the study of public
affairs, 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., a research organization. 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 Compagnie Nationale de Navigation,
a Paris based public company majority owned by Worms & Cie. until January 1998
and presently owned by Compagnie Maritime Belge, whose primary business is
shipping. 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 Feronia International Shipping
("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.
Antoon W. Kienhuis is 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 Internationale Overseas B.V. 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, an investment banking firm, and Smith
Barney Inc., its predecessor, for the past five years. He is the Senior Partner
6
<PAGE>
of Round Hill Associates, a private investment partnership, and sits on numerous
philanthropic boards. Mr. Morse has been a director of SEACOR since June 1998.
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, 1998, the Board held five meetings
and acted by unanimous written consent on four 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 Gellert, 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
1998.
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. Stamas 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 four meetings during
1998.
NOMINATING COMMITTEE
The Company does not maintain a Nominating Committee.
7
<PAGE>
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.
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 $100,000 for the fiscal year ended
December 31, 1998.
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
------------------------------- -------------------------------------------------
# of Securities All Other
Restricted Stock Underlying Compensation
Position (s) Year Salary ($) Bonus ($) (1) Awards ($) (2) Options ($)(3)
- ------------ ---- ---------- ------------- ----------------- --------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Charles Fabrikant, (4) 1998 500,000 625,000 781,947 25,000 4,800
Chairman of the Board, President, 1997 400,000 500,000 183,178 7,500 4,750
and Chief Executive Officer 1996 300,000 500,000 97,400 - 4,000
Randall Blank, (5) 1998 325,000 225,000 207,867 10,000 4,800
Chief Financial Officer, 1997 280,000 200,000 91,589 2,000 4,750
Executive Vice President and 1996 235,000 190,000 30,438 - 3,818
Secretary
Mark Miller, (6) 1998 268,599 40,000 - - 4,800
Vice President 1997 263,769 79,819 - - 4,849
1996 256,430 191,184 18,263 - 4,500
Milton Rose, (7) 1998 190,000 100,000 74,438 500 4,800
Vice President 1997 174,030 85,000 22,075 1,000 4,501
1996 174,030 85,000 14,610 - 3,481
Andrew Strachan, (8) 1998 200,000 75,000 11,125 - 36,166
Vice President 1997 200,000 45,500 196,842 1,000 33,673
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) With the exception of Mr. Miller, whose bonus payment is made at the
time of award, sixty percent of the bonus is paid at the time of the
award while the remaining forty percent is paid in two equal annual
installments one and two years after the date of the grant. Any
outstanding balance is payable upon the death, disability, termination
without "cause" of the employee, or the occurrence of a
"change-in-control" of the Company.
(2) The value indicated is based on the number of shares awarded and the
stock price on the issuance date. The Company provides two kinds of
Restricted Stock Awards. Each award of Type A Restricted Stock ("Type A
Stock") vests in three equal and consecutive annual installments,
commencing on the first anniversary of the date of award. Each award of
Type B Restricted Stock ("Type B Stock") vests approximately one year
from the date of the award. For both kinds of restricted stock, the
restricted shares shall vest immediately upon the death, disability,
termination without "cause" of the employee, or the occurrence of a
"change-in-control" of the Company. If cash dividends are paid by the
Corporation, holders of restricted stock are entitled to receive such
dividends whether or not the shares of restricted stock have vested.
(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, Miller 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").
8
<PAGE>
(4) Mr. Fabrikant was granted restricted stock awards of 1,600, 3,510 and
15,000 shares of Type A Stock pursuant to Restricted Stock Agreements
between the Company and Mr. Fabrikant dated January 27, 1997, February
5, 1998 and January 29, 1999, respectively. Mr. Fabrikant was granted
restricted stock awards of 2,193 and 2,200 shares of Type B Stock
pursuant to Restricted Stock Agreements between the Company and Mr.
Fabrikant dated February 5, 1998 and January 29, 1999, respectively. At
December 31, 1998, Mr. Fabrikant held 7,436 shares of restricted stock
having a value of $367,617 based upon a closing price of $49.4375 per
share of Common Stock on December 31, 1998.
(5) Mr. Blank was granted restricted stock awards of 500, 1,755 and 3,000
shares of Type A Stock pursuant to Restricted Stock Agreements between
the Company and Mr. Blank dated January 27, 1997, February 5, 1998 and
January 29, 1999, respectively. Mr. Blank was granted restricted stock
awards of 1,425 and 1,450 shares of Type B Stock pursuant to Restricted
Stock Agreements between the Company and Mr. Blank dated February 5,
1998 and January 29, 1999, respectively. At December 31, 1998, Mr.
Blank held 4,180 shares of restricted stock having a value of $206,649
based upon a closing price of $49.4375 per share of Common Stock on
December 31, 1998.
(6) Mr. Miller was granted restricted stock awards of 300 shares of Type A
Stock pursuant to a Restricted Stock Agreement between the Company and
Mr. Miller dated January 27, 1997. At December 31, 1998, Mr. Miller
held 400 shares of restricted stock having a value of $19,775 based
upon a closing price of $49.4375 per share of Common Stock on December
31, 1998. 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. In 1998, $54,820 of Mr. Miller's bonus
was attributed to spill response profits for the 1997 calendar year,
although this amount was not determined until 1998.
(7) Mr. Rose was granted restricted stock awards of 240, 423 and 500 shares
of Type A Stock pursuant to Restricted Stock Agreements between the
Company and Mr. Rose dated January 27, 1997, February 5, 1998 and
January 29, 1999, respectively. Mr. Rose was granted restricted stock
awards of 1,000 and 1,000 shares of Type B Stock pursuant to Restricted
Stock Agreements between the Company and Mr. Rose dated February 5,
1998 and January 29, 1999, respectively. At December 31, 1998, Mr. Rose
held 1,983 shares of restricted stock having a value of $98,035 based
upon a closing price of $49.4375 per share of Common Stock on December
31, 1998.
(8) Mr. Strachan joined the Company in 1997. Mr. Strachan was granted
restricted stock awards of 3,000, 228 and 250 shares of Type A Stock
pursuant to Restricted Stock Agreements between the Company and Mr.
Strachan dated January 27, 1997, February 5, 1998 and January 29, 1999,
respectively. At December 31, 1998, Mr. Strachan held 2,228 shares of
restricted stock having a value of $110,147 based upon a closing price
of $49.4375 per share of Common Stock on December 31, 1998. The Company
established an arrangement with Smit pursuant to which the Company was
obligated to reimburse Smit and otherwise make contributions for
continued coverage of Mr. Strachan under Smit's benefit and pension
plans during 1998. In September 1998 the Company initiated certain
plans benefiting Mr. Strachan that were funded in part by a transfer of
assets from Smit. The Company's obligations to reimburse Smit and its
obligations to otherwise make contributions to such plans aggregated
approximately $36,166 during 1998.
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.
9
<PAGE>
OPTION GRANTS TABLE
On January 29, 1999, the Company granted options with respect to fiscal
1998 for a total of 43,350 shares of Common Stock under the 1996 Share Incentive
Plan, none of which are exercisable prior to January 31, 2000 and which expire
not later than January 23, 2009. The Option Agreements provide that the
beneficial ownership of the options shall vest in three approximately equal
annual installments, commencing on January 31, 2000. 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. During 1998 the Company
granted additional options with respect to 4,002 shares of Common Stock under
the 1996 Share Incentive Plan, under terms similar to those noted above. 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
Name Granted Fiscal Year ($/Sh) Date Option Term
- ---- ------- ----------- ------ ---- -----------
5% ($) 10%($)
------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Charles Fabrikant 25,000 53 44.50 1/23/09 699,645 1,773,038
Randall Blank 10,000 21 44.50 1/23/09 279,858 709,215
Milton Rose 500 1 44.50 1/23/09 13,993 35,461
</TABLE>
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 $49.4375 per share. Options issued in 1999 as part of 1998 compensation are
not included in this table.
<TABLE>
<CAPTION>
Shares Value Number of Securities Value of Unexercised
Acquired on Realized ($) Underlying Unexercised In-the-Money Options at
Exercise Options at Fiscal Year-End (#) Fiscal Year-End ($)
Name Exercisable/Unexercisable Exercisable/Unexercisable
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Charles Fabrikant - - 193,611/ 7,500 6,115,882 / 0
Randall Blank 15,000 649,688 37,000 / 2,000 1,209,188 / 0
Milton Rose - - 20,000 / 1,000 693,750 / 0
Andrew Strachan - - 0 / 1,000 0 / 0
Mark Miller - - 15,555 / 0 619,050 / 0
</TABLE>
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,
that has not been documented in a formal written employment agreement (the
"Strachan Arrangement").
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
10
<PAGE>
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 the 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.
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.
11
<PAGE>
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 1998, NRC paid approximately $171,000
to MEG for these services. Mark Miller's father, Mr. James Miller, is Vice
President, Secretary, and Treasurer of MEG.
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 1998, NRC paid approximately $398,000 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
issuance, as of January 1, 1999, of $23.2 million principal amount of five-year
unsecured promissory notes that bear interest at 5.47% per annum. 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.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Stamas 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.
12
<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. Stamas and Conway. The Committee met officially
on four occasions and, in addition, had several informal meetings during 1998 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, 1998 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
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.
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, 1998 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 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 consistent with comparable companies in the industry.
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, along with 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. 1998, for example, was the Company's best year ever with
respect to financial performance. The Company realized approximately 11%, 10%
and 6% increases in revenue, operating income and net income, respectively, for
the Company's fiscal year ended December 31, 1998. Facilitating this growth, the
Company successfully integrated the operations of the acquisitions it had
13
<PAGE>
completed in prior years. From a strategic perspective, the Company continued to
improve the age profile and quality of its fleet through a program of selective
disposition and new construction of vessels.
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 1998 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.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
In 1998, Mr. Fabrikant received total cash compensation (in the form of
salary and bonus) of $1,125,000 from the Company. Additionally, he was granted
15,000 shares of restricted stock and options on 25,000 shares of stock. These
grants were made on January 29, 1999 and vest over three years. Additionally, on
January 29, 1999, Mr. Fabrikant was granted 2,200 shares of restricted stock
that vest on January 31, 2000. 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:
Granville E. Conway, Stephen Stamas
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, 1993 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.
14
<PAGE>
The following table represents the Performance Graph included in the
printed version of this proxy statement:
<TABLE>
<CAPTION>
1998 Proxy Dec-93 Dec-94 Dec-95 Dec-96 Dec-97 Dec-98
- ---------- ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
SCI Offshore Transportation Index 100.00 94.43 126.17 248.29 363.18 168.52
S&P 500 100.00 98.46 132.05 158.80 208.05 263.53
NASDAQ 100.00 96.79 135.44 166.20 202.16 282.26
SEACOR SMIT Inc. Price 100.00 84.78 117.39 273.91 261.96 214.95
</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.
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, 1999. 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, 1998
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.
15
<PAGE>
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, 1999.
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.
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
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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. 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, 1998 accompanies this Proxy Statement and should be read
in conjunction herewith.
STOCKHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
Stockholder proposals to be presented at the 2000 Annual Meeting must be
received by the Company on or before December 8, 1999 for inclusion in the proxy
statement and proxy card relating to that meeting. In accordance with Article I,
Section 1 of the Amended and Restated By-laws of the Company, in order to be
properly brought before the next annual meeting by a stockholder, such
stockholder must deliver to the Company timely notice thereof. To be timely, a
stockholder's notice must be delivered to or mailed and received by the
Secretary at the principal executive offices of the Company, not less than 90
calendar days in advance of the anniversary date of the previous year's annual
meeting of stockholders (or if there was no such prior annual meeting, not less
than 90 calendar days prior to the date which represents the second Tuesday in
May of the current year); if, however, the date of the annual meeting is
advanced by more than 20 days, or delayed by more than 60 days, from such
anniversary date, then, to be considered timely, notice by the stockholders must
be received by the Company not later than the close of business on the later of
(x) the 90th day prior to such annual meeting or (y) the seventh day following
the date on which notice of the date of the annual meeting was mailed to
stockholders or publicly disclosed.
For the Board of Directors
Randall Blank
Executive Vice President,
Chief Financial Officer and Secretary
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