<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] 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 Section 240.14a-11(c) or Section 240.14a-2.
</TABLE>
Interpool, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than 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 0-12.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(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> 2
[INTERPOOL LOGO]
April 17, 1997
Dear Stockholders:
It is our pleasure to invite you to our annual meeting of stockholders. The
meeting will be held on Wednesday, May 21, 1997 at 11:00 a.m. at the Union
League Club, 38 East 37th Street, New York, New York 10016. Please note that the
Union League Club requires that guests dress in a manner befitting the nature of
the Club. Women are requested to wear dresses, skirts or pantsuits and gentlemen
are to be appropriately attired with jackets and ties.
On the following pages you will find the formal notice of the annual
meeting and proxy materials. The vote of each stockholder is important. Please
be sure to mark, sign and return the enclosed proxy card so that your shares
will be represented. Even if you have executed a proxy, you may still attend the
annual meeting and vote your shares in person. In addition to casting your
ballot for the items to be voted upon, you will be afforded an opportunity to
ask questions and express your views on Company operations.
We appreciate the continuing interest and support of our stockholders and
look forward to seeing many of you at the annual meeting.
Sincerely,
<TABLE>
<S> <C>
- --------------------------------------------- ---------------------------------------------
Martin Tuchman Raoul J. Witteveen
Chairman of the Board President/Chief Financial Officer
Chief Executive Officer Chief Operating Officer
</TABLE>
INTERPOOL, INC. 211 College Road East/Princeton, New Jersey 08540
<PAGE> 3
INTERPOOL, INC.
211 COLLEGE ROAD EAST
PRINCETON, NEW JERSEY 08540
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 21, 1997
Princeton, New Jersey
April 17, 1997
To the Stockholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
INTERPOOL, INC. (the "Company") will be held at The Union League Club, 38 East
37th Street, New York, New York 10016 on Wednesday, May 21, 1997, at 11:00 a.m.,
Eastern Daylight Time, for the following purposes:
(1) to elect two (2) directors to serve as Class I directors for a term of
three years and until their successors shall have been elected and
shall have qualified; and
(2) to ratify the appointment of Arthur Andersen LLP as the Company's
independent accountants for the 1997 fiscal year; and
(3) to act upon such other matters as may properly come before the meeting
or any adjournments thereof.
All holders of common stock of record at the close of business on April 15,
1997 will be entitled to notice of and to vote at the Annual Meeting.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE DATE, SIGN AND
PROMPTLY RETURN THE ENCLOSED PROXY IN THE PREPAID RETURN ENVELOPE PROVIDED. YOU
MAY REVOKE YOUR PROXY AT ANY TIME BEFORE IT IS VOTED AT THE MEETING BY
SUBMITTING A WRITTEN REVOCATION OR A NEW PROXY, OR BY ATTENDING AND VOTING AT
THE ANNUAL MEETING.
By Order of the Board of Directors
--------------------------------------
Martin Tuchman
Chairman/Chief Executive Officer
<PAGE> 4
INTERPOOL, INC.
211 COLLEGE ROAD EAST
PRINCETON, NEW JERSEY 08540
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation on
behalf of the Board of Directors of Interpool, Inc. (the "Company") of proxies
for use at the Annual Meeting of Stockholders (the "Annual Meeting") of the
Company to be held on Wednesday, May 21, 1997 at 11:00 a.m., Eastern Daylight
Time, and at any adjournments thereof.
This Proxy Statement, Notice of Meeting, form of proxy and the Company's
Annual Report for 1996 are being mailed to each stockholder at such holder's
address of record on or about April 17, 1997.
GENERAL
Only stockholders of record at the close of business on April 15, 1997 are
entitled to notice of and to vote the shares of common stock of the Company (the
"common stock") held by them on that date at the Annual Meeting or any
adjournments thereof.
If the accompanying proxy card is properly signed and returned to the
Company and not revoked, it will be voted in accordance with the instructions
contained therein. Unless contrary instructions are given, the persons
designated as proxy holders in the proxy card will vote for the two director
nominees proposed by the Board of Directors, for ratification of the appointment
of Arthur Andersen LLP as the Company's independent accountants for the fiscal
year ending December 31, 1997 and, with regard to all other matters that may
properly come before the meeting, as recommended by the Board of Directors; or,
if no such recommendation is given, in their own discretion. Each stockholder
may revoke a previously granted proxy at any time before it is exercised by
filing a revoking instrument or a duly executed proxy bearing a later date with
the Secretary of the Company. The powers of the proxy holders will be suspended
if the person executing the proxy attends the Annual Meeting in person and so
requests. Attendance at the Annual Meeting will not, in itself, constitute
revocation of a previously granted proxy.
The presence at the Annual Meeting, in person or by proxy, of the holders
of a majority of the shares of common stock outstanding on April 15, 1997 will
constitute a quorum. Each outstanding share entitles its holder to cast one vote
on each matter to be voted upon at the Annual Meeting. As of April 15, 1997,
27,551,728 shares of common stock were outstanding.
The cost of soliciting proxies in the enclosed form will be borne by the
Company. It is expected that the solicitation will be primarily by mail.
Officers and regular employees of the Company may, but without compensation
other than their regular compensation, solicit proxies by further mailing or
personal conversations, or by telephone, telex or facsimile. The Company will,
upon request, reimburse brokerage firms and others for their reasonable expenses
in forwarding solicitation material to the beneficial owners of stock.
<PAGE> 5
ITEM 1. ELECTION OF DIRECTORS
The Board of Directors of the Company is divided into three classes, as
nearly equal in number as possible. Each class serves three years, with the
terms of office of the respective classes expiring in successive years. The term
of office of directors in Class I expires at the 1997 Annual Meeting. The Board
of Directors proposes that the nominees described below, both of whom are
currently serving as Class I directors, be elected to Class I for a new term of
three years and until their successors are duly elected and qualified. The Board
of Directors has no reason to believe that any of the nominees will not serve if
elected, but if any of them should become unavailable to serve as a director,
and if the Board designates a substitute nominee, the persons named as proxies
will vote for the substitute nominee designated by the Board.
Directors will be elected by a plurality of the votes cast at the Annual
Meeting. If elected, all nominees are expected to serve until the 2000 Annual
Meeting and until their successors are duly elected and qualified.
CLASS I -- DIRECTORS STANDING FOR ELECTION
WARREN L. SERENBETZ
Warren L. Serenbetz has been a director of the Company since February 1988
and served as Executive Consultant through January 1995. He has also been a
director of Trac Lease, Inc. ("Trac Lease"), a subsidiary of the Company, since
its founding in November 1986. After co-founding Interpool Limited, a subsidiary
of the Company, in 1968, Mr. Serenbetz served as Interpool Limited's president
and chief executive officer and as a director until 1975, after which he was
director, chairman of the Executive Committee and chief executive officer until
his retirement in 1986. Mr. Serenbetz rejoined the Board of Directors of
Interpool Limited in 1988. Mr. Serenbetz is currently president of Radcliff
Group, Inc. He has been active in industry affairs, serving as an officer,
director and member of various world trade and shipping associations. Mr.
Serenbetz holds a bachelor's degree in engineering from Columbia University and
a master's degree in industrial engineering from Columbia University.
JOSEPH J. WHALEN
Joseph J. Whalen, a Director of the Company since April 1996, originally
joined the accounting firm of Arthur Andersen LLP in 1957 and served as an audit
partner in Andersen's New York and New Jersey office for more than ten years
prior to his retirement in 1994. Mr. Whalen is a member of the American
Institute of Certified Public Accountants and the New Jersey State Society of
Certified Public Accountants where he previously served on the Cooperation with
Credit Grantors Committee and the Technical Standards Section of the
Professional Conduct Committee. Mr. Whalen is a Certified Public Accountant in
New Jersey and New York and holds a bachelor's degree from St. Peter's College.
DIRECTORS CONTINUING IN OFFICE
CLASS II -- TERM EXPIRES AT THE 1998 ANNUAL MEETING
RAOUL J. WITTEVEEN
Raoul J. Witteveen has been President, Chief Operating Officer, Chief
Financial Officer and a director of the Company since March 1993 and has been
President, Chief Operating Officer, Chief Financial Officer and a director of
Interpool Limited since April 1988. He is a co-founder of Trac Lease and has
been Chief Financial Officer, Vice President and a director of Trac Lease since
June 1987. From 1982 to 1986, Mr. Witteveen served in a variety of management
capacities at Thyssen-Bornemisza N.V., the former parent of Interpool Limited.
Mr. Witteveen holds a bachelor's degree in economics and business administration
and a master's degree in economics from the Erasmus University in Rotterdam, The
Netherlands.
2
<PAGE> 6
JOHN M. BUCHER
John M. Bucher has been a director of the Company since March 1993. He has
been an investment broker with the firm of Stires and Company, Inc. since 1978,
where he advises individual and institutional investors and is active in venture
capital placements. Mr. Bucher holds a bachelor's degree in English from Amherst
College.
CLASS III -- TERM EXPIRES AT THE 1999 ANNUAL MEETING
MARTIN TUCHMAN
Martin Tuchman, Chairman of the Board of Directors and Chief Executive
Officer of the Company since February 1988, is also Chairman of the Board of
Directors, Chief Executive Officer and a director of Interpool Limited, which he
co-founded in 1968. He also has served as a director of Trac Lease, Inc. since
June 1987, President of Trac Lease for the period including June 1987 through
January 1994 and currently serves as its Chairman and Chief Executive Officer.
He has also been Chairman of the Board of Directors of Princeton International
Properties, Inc., a family-owned real estate company, which owns and has
interests in properties located in Princeton, New Jersey. Mr. Tuchman was
previously a member of the Society of Automotive Engineers as well as the
American National Standards Institute. Currently, Mr. Tuchman is a member of the
United Nations Business Council, a Council comprised of leading international
executives organized to promote understanding and cooperation between business
and government and a member of the Board of Trustees of the New Jersey Institute
of Technology. In 1995, Mr. Tuchman was honored as General Services Entrepreneur
Of The Year in an awards program founded by Ernst & Young LLP and in 1996 was
named Alumni of the Year by the New Jersey Institute of Technology. Mr. Tuchman
holds a bachelor's degree in mechanical engineering from the New Jersey
Institute of Technology (Newark College of Engineering) and a master's degree in
business administration from Seton Hall University.
ARTHUR L. BURNS
Arthur L. Burns, General Counsel, Secretary and a director of the Company
since January 1990, was Senior Vice President of Law and Administration and
Secretary of Interpool Limited from 1986 until June 1996. Since June 1996, Mr.
Burns has acted as the Company's independent General Counsel. Prior to joining
Interpool Limited, Mr. Burns served as assistant general counsel to GATX Leasing
Corp. between 1975 and 1980, and as an associate attorney at the New York law
firm of Cahill, Gordon & Reindel from 1969 to 1975. Mr. Burns holds a bachelor's
degree in economics from Holy Cross College and a law degree from Fordham
University School of Law.
PETER D. HALSTEAD
Peter D. Halstead, a Director of the Company since June 1994, has been with
Summit Bank since 1971 and is now an Executive Vice President. In addition to
serving as a Trustee for numerous associations including McCarter Theatre and
Cancer Care of New Jersey, Mr. Halstead serves on the commercial lending
committee of the New Jersey Banker's Association. Mr. Halstead holds a
bachelor's degree from Colgate University and a master's degree in business
administration from Fairleigh Dickinson University.
COMMITTEES OF THE BOARD
The Board has standing Executive, Compensation, Audit and Stock Option
Committees, but no Nominating Committee. Special Committees are appointed from
time to time by the Board.
Special Committees. No special committees were appointed in 1996.
Compensation Committee. The 1996 Compensation Committee was composed of
Messrs. Tuchman, Bucher and Halstead. The Committee's functions are to review
the Company's general compensation strategy; establish salaries and review
benefit programs and approve certain employment contracts. The Compensation
Committee met once in fiscal 1996.
3
<PAGE> 7
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal year 1996, Mr. Tuchman participated in deliberations of the
Compensation Committee and the Company's Board of Directors concerning executive
officer compensation, however, Mr. Tuchman did not participate in discussions
regarding compensation of the Company's Chief Executive Officer.
Audit Committee. The 1996 Audit Committee was comprised of independent
directors Messrs. Bucher, Halstead and Whalen. The Audit Committee's functions
are to review management's maintenance of systems of internal control, financial
reporting and application of generally accepted accounting principals. In
addition, the Audit Committee reviews the scope of the services of the Company's
independent auditors and may recommend the independent auditors for appointment
by the Board of Directors subject to Stockholder approval. The Audit Committee
met once in 1996.
Stock Option Committee. The 1996 Stock Option Committee was composed of
Messrs. Tuchman, Witteveen and Halstead. The Company's 1993 Stock Option Plan
for Executive Officers and Directors (the "Stock Option Plan") was adopted by
the Company's Board of Directors and approved by the stockholders in March 1993
and amended in May 1996. A total of six million shares of common stock have been
reserved for issuance under the Stock Option Plan. Options may be granted under
the Stock Option Plan to executive officers and directors of the Company or a
subsidiary (including any executive consultant of the Company and its
subsidiaries), whether or not they are employees.
To date, options to purchase 4,408,500 shares under the 1993 Stock Option
Plan for Executive Officers and Directors have been granted, 15,000 of which
have expired due to failure to exercise. Options to purchase 75,000 shares have
been granted under the Non Qualified Stock Option Plan for Non-Employee, Non-
Consultant Directors, 30,000 of which have expired due to failure to exercise.
None of the options granted under either the 1993 Stock Option Plan for
Executive Officers and Directors or the Non Qualified Stock Option Plan for
Non-Employee, Non-Consultant Directors have been exercised to date.
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
executive officers and directors of the Company:
<TABLE>
<CAPTION>
NAME AGE POSITIONS AND OFFICES
- ------------------------------ --- ------------------------------------------------------
<S> <C> <C>
Martin Tuchman................ 56 Chairman of the Board of Directors and Chief Executive
Officer
Raoul J. Witteveen............ 41 President, Chief Operating Officer, Chief Financial
Officer and Director
Warren L. Serenbetz........... 73 Director
Sheldon Landy 65 Vice President, President Railpool Division
Arthur L. Burns............... 52 Secretary and Director
Ernst Baenziger............... 61 Director
John M. Bucher................ 66 Director
Peter D. Halstead............. 55 Director
Joseph J. Whalen.............. 65 Director
Richard W. Gross.............. 52 Senior Vice President
William Geoghan............... 46 Controller
</TABLE>
4
<PAGE> 8
NON-DIRECTOR EXECUTIVE OFFICERS
RICHARD W. GROSS
Richard W. Gross, Senior Vice President of the Company since 1996 has been
Senior Vice President, Finance of Interpool Limited since 1990 and is
responsible for investor and lender relations. Mr. Gross originally joined
Interpool Limited as Controller, and has been with Interpool for more than 20
years. Prior to joining Interpool, Mr. Gross spent five years with Arthur
Andersen in their New York office. Mr. Gross is a certified public accountant
and received a Bachelor of Science degree in Accounting from Long Island
University.
ERNST BAENZIGER
Ernst Baenziger has been an employee since 1977, serving as Senior Vice
President and a director of Interpool Limited since 1991. Mr. Baenziger is
responsible for Europe, Far East, Australia and New Zealand operations. He is
also Managing Director of Interpool Limited's Basel, Switzerland branch,
handling sales and operations, and serves as the managing director of CTC
Equipment A.G. Mr. Baenziger holds a bachelor's degree in economics and business
administration from Handelshochschule, St. Gallen.
SHELDON LANDY
Sheldon Landy, Vice President of the Company since March 1993, has been
President of the Company's Railpool division since 1979. Mr. Landy is a member
of the Transportation Research Board, a part of the National Research Council
and serves as a committee member studying the intermodal transportation
industry. Mr. Landy holds a bachelor's degree in liberal arts from the
University of Chicago and master's degree in business administration from
Northwestern University.
WILLIAM A. GEOGHAN
William Geoghan, Controller of the Company since April 1992 and Vice
President and Controller of Interpool Limited since January 1989, is a certified
public accountant. He joined Interpool Limited in 1981 and served as assistant
controller for Interpool Limited 1985 to 1989. Mr. Geoghan holds a bachelor's
degree in commerce from Rider University.
EXECUTIVE COMPENSATION
The following table sets forth the compensation paid or accrued by the
Company to or on behalf of its Chief Executive Officer and each of its other
four most highly compensated executive officers who earned over $100,000 in 1996
for services rendered in all capacities during the years ended December 31,
1996, 1995 and 1994.
5
<PAGE> 9
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
---------------------------------------- ------------
OTHER # STOCK
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1)(2) OPTIONS
- -------------------------------------- ---- -------- -------- ------------------ ------------
<S> <C> <C> <C> <C> <C>
Martin Tuchman........................ 1996 $638,141 $464,580 $ 72,079 225,000
Chairman of the Board of Directors 1995 $607,753 $357,300 $ 47,063 0
Chief Executive Officer and Director 1994 $578,812 $231,960 $ 33,520 1,200,000
Raoul J. Witteveen.................... 1996 $449,737 $302,290 $ 36,239 112,500
President, Chief Financial Officer, 1995 $428,321 $228,650 $ 21,015 0
Chief Operating Officer and Director 1994 $407,925 $140,980 $ 51,846 600,000
Ernst Baenziger....................... 1996 $179,702 $ 0 $ 516,667(2) 0
Sr. Vice President, Interpool 1995 $177,600 $ 0 $ 480,000(2) 0
Limited
1994 $177,600 $ 0 $1,035,000(2) 0
Sheldon Landy......................... 1996 $152,000 $ 40,000 0 0
Vice President; President of 1995 $147,000 $ 40,000 0 0
the Railpool Division 1994 $140,000 $ 63,000 0 0
Arthur L. Burns(3).................... 1996 $ 69,034 $ 20,000 $ 51,931 14,063
General Counsel, 1995 $154,350 $ 50,000 $ 7,077 0
Secretary and Director 1994 $147,000 $ 70,000 $ 9,298 75,000
</TABLE>
- ---------------
(1) Amounts listed include payments made to or on behalf of the executive for
certain Company provided automobile and related expenses and medical expense
reimbursement as provided for in the executive's Employment Agreement.
(2) Amounts listed as Other Compensation include sales commissions paid.
(3) As of June 1, 1996, Mr. Burns resigned as Vice President of the Company but
continues to act as independent General Counsel and as secretary of the
Company. Amounts listed in salary include amounts paid through May 31, 1996.
Amounts listed under other compensation include $50,025 paid to Mr. Burns
for services rendered as General Counsel commencing June 1, 1996. See
Related Party Transactions.
STOCK OPTIONS
On March 1, 1996, 465,001 options to purchase common stock were granted
pursuant to the 1993 Stock Option Plan For Executive Officers and Directors, as
follows: Martin Tuchman, 225,000; Raoul J. Witteveen, 112,500; Warren L.
Serenbetz, 98,438; Arthur L. Burns, 14,063; John M. Bucher, 7,500; Peter D.
Halstead, 7,500. On April 1, 1996, an option to purchase 15,000 shares of common
stock was granted to Joseph J. Whalen under the Non-Qualified Stock Option Plan
for Non-Employee, Non-Consultant Directors upon Mr. Whalen's appointment to the
Board of Directors.
The following tables set forth information regarding the grant of stock
options to certain individuals under the Non-Qualified Stock Option Plan for
Executive Officers and Directors and the Non-Qualified Stock Plan for
Non-Employee, Non-Consultant Directors during Fiscal 1996. The tables also
contain hypothetical potential realizable value during the option terms,
assuming a 5% and 10% annual rate of appreciation for all stockholders.
6
<PAGE> 10
OPTION GRANTS DURING FISCAL 1996
AND
ASSUMED POTENTIAL REALIZABLE VALUES
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
% OF TOTAL AT ASSUMED ANNUAL RATES
OPTIONS STOCK APPRECIATION
NUMBER GRANTED TO FOR OPTION TERM
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION ---------------------------
NAME GRANTED FISCAL 1996 PRICE DATE 5% 10%
- ------------------------ ---------- ------------ -------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Martin Tuchman.......... 225,000 48.39% $11.08 3/1/2006 $ 1,567,834 $ 3,973,200
Raoul J. Witteveen...... 112,500 24.19% $11.08 3/1/2006 $ 783,917 $ 1,986,600
Warren R. Serenbetz..... 98,438 21.17% $11.08 3/1/2006 $ 685,931 $ 1,738,284
Arthur L. Burns......... 14,063 3.02% $11.08 3/1/2006 $ 97,993 $ 248,334
John M. Bucher.......... 7,500 1.61% $11.08 3/1/2006 $ 52,261 $ 132,440
Peter D. Halstead....... 7,500 1.61% $11.08 3/1/2006 $ 52,261 $ 132,440
Joseph J. Whalen........ 15,000 $12.17 4/1/2006 $ 114,805 $ 290,938
All Stockholders........ 27,551,728 $11.08 3/1/2006 $191,984,641 $486,526,775
27,551,728 $12.17 4/1/2006 $210,871,217 $534,389,066
</TABLE>
- ---------------
(1) Amounts for the named individuals shown under the "Potential Realizable
Value" columns above have been calculated by multiplying the exercise price
by the annual appreciation rate shown (compounded for the term of the
options), subtracting the exercise price per share and multiplying the gain
per share by the number of shares covered by the options.
(2) The amounts under these columns are the result of calculations at the 5% and
10% rates set by the Securities and Exchange Commission and are not intended
to forecast possible future appreciation of the Company's stock prices.
DIRECTORS' COMPENSATION; ATTENDANCE
Each member of the Board who is not an officer or executive consultant
receives an annual fee of $5,000 for serving on the Board plus $500 and
reimbursement of expenses for each Board or committee meeting attended.
The Board of Directors met four times during fiscal 1996. Each current
director attended at least 75% of all meetings of the Board of Directors and
committees to which he was assigned that were held during 1996.
DIRECTORS' STOCK OPTIONS
The Company's Non-Qualified Stock Option Plan for Non-Employee,
Non-Consultant Directors (the "Directors' Plan") was adopted by the Board of
Directors and approved by the stockholders in March 1993. The Directors' Plan
provides for the automatic grant of non-qualified options to non-employee,
non-consultant directors at the time the director first joins the Board. The
Directors' Plan authorizes grants of options up to an aggregate of 150,000
shares of common stock. The exercise price per share is the fair market value of
the Company's common stock on the date the person becomes a Director. The
options granted pursuant to the Directors' Plan may be exercised at the rate of
one-third of the shares on the first anniversary of the director's grant date,
one-third of the shares on the second anniversary of the director's grant date
and one-third of the shares on the third anniversary of the director's grant
date, subject to certain holding periods required under rules of the Securities
and Exchange Commission. Options granted pursuant to the Directors' Plan expire
ten years from their grant date except that in the event of the death of a
director, the option must be exercised within six months of the date of death
or, in the event of resignation of a director, the option must be exercised
within ten days of the date of resignation. The Directors' Plan is administered
by the Stock Option Committee of the Board of Directors. Pursuant to the
Directors' Plan, an option to purchase 15,000 shares of common stock was granted
to Mr. Bucher in May 1993, to Peter D. Halstead upon his appointment to the
Board of Directors in June 1994 and to Mr. Whalen upon his appointment in April,
1996. In addition, directors of the Company may be granted options under the
1993 Stock Option Plan for Executive Officers and Directors as
7
<PAGE> 11
adopted by the Board of Directors and approved by the Stockholders in March
1993. In March 1996, Messrs. Bucher and Halstead each were granted an option to
purchase 7,500 shares of Common Stock under the 1993 Stock Option Plan for
Executive Officers and Directors. To date, no stock options have been exercised.
EMPLOYMENT CONTRACTS
The Company has entered into employment agreements with Raoul J. Witteveen
and Martin Tuchman, each dated as of January 1, 1992, as amended and restated in
February 1993 (the "Employment Agreement"). Each of the Employment Agreements
currently expires on December 31, 2003, except that on each January 1, the
expiration date of each employment agreement is automatically extended for an
additional year unless the Company or the employee to such employment agreement
has given written notice of an election not to extend beyond the end of the then
current seven year term. Notice of any such election not to extend the
expiration date must be delivered not less than six months prior to the next
occurring January 1.
As compensation for the services to be rendered under their employment
agreements, Mr. Tuchman is currently paid an annual base salary of $670,047 and
Mr. Witteveen is currently paid an annual base salary of $472,224. The base
salary under each employment agreement increases by a minimum of 5% each year.
In addition, each of Messrs. Tuchman and Witteveen is entitled to receive an
annual bonus equal to 2%, in the case of Mr. Tuchman, or 1%, in the case of Mr.
Witteveen, of the amount of any increase in the Company's net income during the
year from its net income in the preceding year. Mr. Tuchman and Mr. Witteveen
may be entitled to receive additional bonuses based on the performance of the
Company as determined by the Company's Compensation Committee. Each employment
agreement (i) includes a non-competition provision; (ii) provides that, in the
event of the employee's death, the employee's base salary will continue to be
paid to his beneficiary for two additional years and, in the event of
termination of the employee without cause, the employee will continue to receive
his base salary for the entire remaining term then in effect under the
employment agreement; and (iii) provides for reimbursement to the employee, for
both the employee and his spouse, of all health related costs and expenses that
are not advanced or reimbursed to the employee pursuant to Company medical and
dental insurance plans, which additional reimbursement continues for a period of
five years after expiration of the employment agreement.
The Company entered into an employment agreement with Arthur L. Burns dated
as of January 1, 1993. As of June 1, 1996, Mr. Burns resigned as Vice President
of the Company and Senior Vice President of Interpool Limited and voluntarily
terminated the agreement, electing instead to act as the Company's independent
General Counsel and secretary. Accordingly, since that date, Mr. Burns has not
been an employee or executive officer of the Company.
REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee, in conjunction with the full Board, plays a
significant role in establishing corporate goals and strategies and reviewing
progress and performance. The Compensation Committee's objectives are to attract
and retain experienced and highly competent executives and, further, to both
provide incentive and to recognize the individual's contributions toward
accomplishing corporate objectives including increasing shareholder value. The
elements of total executive compensation reflect the objectives of the
Compensation Committee. The base salaries of the Chairman/Chief Executive
Officer and the President/ Chief Financial Officer are supplemented by bonuses
which are calculated on the basis of the increase in the Company's net income
from that of the preceding year. In addition, performance driven discretionary
bonuses and stock options are awarded to the Chairman/Chief Executive Officer
and the President/Chief Financial Officer and other executive officers based on
the Committee's evaluation of the individual's actual participation and
contribution to achieving Company goals and objectives.
8
<PAGE> 12
BASE SALARY
The base salaries of Messrs. Tuchman and Witteveen are established under
employment agreements. (See "Employment Agreements".) In accordance with the
terms of the Employment Agreements, each of the named executive officers' base
salary reflects a 5% increase above the annual base salary for the preceding
year. In reviewing the Company's performance against its business objectives for
1996 noting specifically the increased primary and fully diluted earnings per
share and the significant increase in fleet size while maintaining utilization
in excess of 95%, the Committee believes that the "hands on" involvement in all
phases of the Company's operations contributes significantly to realizing
Company objectives and recommended that the base salary of Messrs. Tuchman and
Witteveen continue to be paid at the levels established under the terms of the
Employment Agreements.
STOCK OPTIONS
Stock Options awarded by the Stock Option Committee are considered by the
Compensation Committee in evaluating total compensation and assuring that
executive rewards are linked with long term stockholder value.
BONUSES
To reward performance, bonuses are paid to the Chairman and Chief Executive
Officer and other executive officers. The cash bonus awards are directly tied to
the performance of the Company and the contribution of the individual in
achieving the Company's performance objectives. In determining the amount of the
cash bonus to be awarded, the Compensation Committee considers the increase
between the Company's net income for the preceding fiscal year and the Company's
net income for the current fiscal year and the efforts of the individual which
contributed to the increase. In the case of Messrs. Tuchman and Witteveen, the
Employment Agreements provide that the annual bonus may not be less than two
percent of the increase in the Company's net income. Through the use of an
actual formula to which bonuses are directly tied to increased net income, the
Compensation Committee furthers the Company's overall objective of enhancing
profitability and increasing shareholder value. Following each fiscal year, the
Committee establishes a bonus pool, the amount of which is based upon a
subjective assessment of overall Company and individual performance and the
extent to which the Company achieved its overall financial goals, growth and
return on equity. The Committee believes that the "at risk" feature of
discretionary bonuses and bonuses directly tied to percentage increase of
Company net income best serves the interests of the Company and its
shareholders. Mr. Tuchman withdrew from discussions regarding his award.
TAX DEDUCTIBILITY OF COMPENSATION
As part of the Omnibus Budget Reconciliation Act of 1993 (the "Act"),
certain provisions regarding executive compensation for officers of public
companies were added to the Internal Revenue Code. Under the Act, the Internal
Revenue Service has issued proposed regulations setting forth exclusions from
the Act's general disallowance of ordinary business expense deduction for
compensation in excess of $1 million paid to a company's chief executive officer
and each of the next four most highly compensated executive officers. The
Compensation Committee has decided that at this time no measures will be
undertaken to alter the compensation plans, but will continue to review the
issue and evaluate whether compensation plans should be altered in the future to
satisfy the deductibility requirements.
John M. Bucher / Peter D. Halstead / Martin Tuchman
9
<PAGE> 13
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of the Company's common stock as of April 15, 1997 by
certain beneficial owners, each of the Company's directors, certain executive
officers and all executive officers and directors as a group. All share
information reflects the Company's 3 for 2 stock split on March 27, 1997.
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE
NAME OF BENEFICIAL OWNER SHARES(9)(10) OF CLASS
- ---------------------------------------------------------------------- ------------- ----------
<S> <C> <C>
Officers and Directors:
Martin Tuchman(1)(2).................................................. 8,756,768 30.2%
Raoul J. Witteveen(1)(3).............................................. 4,343,924 15.4%
Warren L. Serenbetz(1)(4)(5).......................................... 1,658,243 5.9%
Arthur L. Burns....................................................... 403,019 1.5%
John M. Bucher........................................................ 37,500 *
Peter D. Halstead..................................................... 39,000 *
Joseph J. Whalen...................................................... 5,000 *
Sheldon Landy......................................................... 0 *
Ernst Baenziger....................................................... 25,000 *
Executive officers and directors as a group (ten persons)............. 15,274,593 50.1%
Other Stockholders:
Hickory Enterprises, L.P.(6).......................................... 5,088,911 18.5%
165 Signal Hill North
Wilton, Connecticut 06897-1933
Warren L. Serenbetz Jr.(7)............................................ 283,646 1.03%
c/o American National Can Co.
101 Merritt 7, 3rd Floor
Norwalk, CT 06856
Paul H. Serenbetz(7).................................................. 283,646 1.03%
c/o The Morgan School
Route 81
Clinton, CT 06413
Stuart W. Serenbetz(7)................................................ 283,646 1.03%
c/o Turner Development Corp.
375 Hudson Street, 6th Floor
New York, NY 10014
Clay R. Serenbetz(7).................................................. 283,646 1.03%
c/o Radcliff Group, Inc.
695 West Street
Harrison, NY 10528
The Chartres Limited Partnership(8)................................... 90,000 *
c/o Interpool, Inc.
633 Third Avenue
New York, NY 10017
</TABLE>
- ---------------
* Less than 1%
(1) The business address of each of these individuals is 211 College Road East,
Princeton, New Jersey 08540.
(2) Includes 4,749 shares of which Mr. Tuchman's mother is the record owner;
3,037 shares held jointly by Mr. Tuchman's wife and Mr. Tuchman's
mother-in-law; 8,668 shares held by a pension plan f/b/o Mr. Tuchman;
41,719 shares held by a revocable grantor trust of which Mr. Tuchman is the
grantor and trustee and Mr. Tuchman's brother is the beneficiary; 10,948
shares representing Mr. Tuchman's 99% interest in shares held by Martom
Associates; and 143,497 shares representing Mr. Tuchman's 28.57% interest
in shares held by The Ivy Group, a New Jersey partnership.
10
<PAGE> 14
(3) Includes 1,500 shares of which Mr. Witteveen's wife is the record owner and
71,774 shares representing Mr. Witteveen's 14.29% interest in shares held
by The Ivy Group, a New Jersey partnership.
(4) Includes 143,497 shares representing Mr. Serenbetz's 28.57% interest in
shares held by The Ivy Group, a New Jersey partnership
(5) The Serenbetz Trust, of which Warren L. Serenbetz and Thelma R. Serenbetz,
Mr. Serenbetz's wife, serve as co-trustees, is the record owner of these
shares of the Company's common stock. The beneficiaries of the Serenbetz
Trust are members of the immediate family of Warren L. Serenbetz.
(6) On November 30, 1994, Hickory Enterprises, L.P., a Delaware limited
partnership ("Hickory") was formed. Warren L. Serenbetz contributed
2,238,911 shares of the Company's common stock in exchange for a 44%
interest as a limited partner in Hickory. One half of that interest was
assigned to the Warren L. Serenbetz Retained Annuity Trust, Warren L.
Serenbetz, Jr., Trustee. Each of Warren L. Serenbetz, Jr., Stuart W.
Serenbetz, Paul H. Serenbetz and Clay R. Serenbetz contributed 641,250
shares of the Company's common stock in exchange for a 12.6% interest as a
limited partner and 71,250 shares for a 1.4% interest as a general partner
in Hickory. Each of the four general partners in Hickory have one vote in
matters before Hickory. Limited partners do not have any voting rights or
rights to participate in the management or operations of Hickory.
(7) Each of Warren L. Serenbetz, Jr., Paul H. Serenbetz, Stuart W. Serenbetz
and Clay R. Serenbetz is a son of Warren L. Serenbetz. Does not include
shares held by Hickory Enterprises, L.P. described in footnote (6) above.
(8) On February 1, 1995, Arthur L. Burns entered into an Agreement of Limited
Partnership pursuant to which Mr. Burns contributed 90,000 shares of
restricted common stock to The Chartres Limited Partnership ("Chartres"),
in exchange for a 98% limited partnership interest in Chartres. Each of
Meredith K. Burns and Kristin M. Burns, daughters of Arthur L. Burns, are
the other limited partners and the general partners of Chartres. Limited
partners do not have any voting rights or rights to participate in the
management or operation of Chartres.
(9) Does not include shares subject to options which have been granted in the
following amounts but are not exercisable: Martin Tuchman: 855,000, Raoul
J. Witteveen: 427,500, Warren L. Serenbetz: 45,000, Arthur L. Burns: 7,500,
John M. Bucher: 22,500, Peter D. Halstead: 22,500 and Joseph J. Whalen:
32,500.
(10) Includes shares subject to options which are exercisable within 60 days as
follows: Martin Tuchman: 1,425,000; Raoul J. Witteveen: 712,500; Warren L.
Serenbetz: 623,438; Arthur L. Burns: 89,063; John M. Bucher: 37,500; Peter
D. Halstead: 37,500; and Joseph J. Whalen: 5,000 In the event that all said
options were exercised, the total outstanding number of the shares of the
Company's common stock would be 31,894,229.
STOCKHOLDERS' AGREEMENT
Martin Tuchman, Raoul J. Witteveen, Arthur L. Burns, Hickory Enterprises
L.P., Warren L. Serenbetz Revocable Trust, Warren L. Serenbetz, Jr., Stuart W.
Serenbetz, Paul H. Serenbetz, Clay R. Serenbetz and Chartres Limited
Partnership, who collectively own directly or indirectly 67.6% of the Company's
common stock, are parties to an Amended and Restated Stockholders' Agreement
dated May 3, 1994 pursuant to which they have agreed not to sell or transfer any
shares of Common Stock beneficially owned by them to any person other than the
Company or the other parties to the Stockholders' Agreement without the consent
of the other parties to the Stockholders' Agreement, unless (i) such shares are
first offered to the Company for purchase at a per share price equal to the
price offered by any third party making a bona fide offer to buy such shares for
cash, cash equivalents or marketable securities (or if no such bona fide offer
has been received, at a price equal to the average closing price of a share of
Common Stock on the New York Stock Exchange over a period of 20 trading days),
and the Company does not elect to purchase such shares, and (ii) such shares are
then offered to the other parties to the Stockholders' Agreement for purchase by
them at the same per share price described in clause (i) and the other
stockholders do not elect to purchase such shares. Notwithstanding the
foregoing, the parties to the Stockholders' Agreement may transfer shares of
Common Stock to one or more of certain members of their immediate families (or
trusts for the benefit of such family members) so
11
<PAGE> 15
long as each transferee agrees to be bound by the terms of the Stockholders'
Agreement. The Stockholders Agreement further provides that if the Company
(which is not a party to the Stockholders' Agreement) elects to purchase any
shares offered to it by a party to the Stockholders' Agreement and the shares
offered represent greater than 10% of the shares of the Company held by the
offeror, the Company shall have the right to pay the purchase price of such
shares by delivery of a promissory note, payable in equal monthly installments
(with interest at the prime rate) over the following year. Pursuant to the
Stockholders' Agreement, each of the parties thereto has agreed to vote for the
re-election of Messrs. Tuchman, Serenbetz, Witteveen and Burns as directors of
the Company. The Stockholders' Agreement continues in effect until 2003.
Within the last year, Messrs. Tuchman, Witteveen and Serenbetz, together
with The Ivy Group, a partnership in which they hold collectively a 71.4%
interest, have acquired more than 570,000 shares of Interpool common stock,
increasing their holdings of Interpool common stock, through purchases on the
open market, conversion of preferred stock into common stock and other
transactions. This acquisition program, which was previously announced, has now
been largely completed. Currently, Messrs. Tuchman, Witteveen and Serenbetz
beneficially own a total of 17,662,724 shares, representing 64.1% of the
Company's outstanding common stock.
Arthur L. Burns, the Company's independent General Counsel and Secretary,
has advised the Company that he may seek to diversify his investments and in
that connection may reduce his holdings of Interpool common stock. Mr. Burns
has taken the necessary action under the Stockholders Agreement to enable him
to effect one or more such transactions.
BENEFICIAL OWNERSHIP REPORTS
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors to file certain reports of ownership and
reports of changes of ownership of the Company's equity securities with the
Securities and Exchange Commission. Executive officers and directors are
required to furnish the Company with copies of all Section 16(a) forms that they
file. Based upon a review of these filings and written representations from
certain of the Company's directors and executive officers, the Company notes
that changes in beneficial ownership by Messrs. Tuchman, Witteveen and Serenbetz
were inadvertently reported late on Form 4.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company's senior executive officers have interests in other entities
that have entered into financing, leasing and other transactions with the
Company (including its subsidiaries). The Ivy Group, a New Jersey partnership
composed of Mr. Tuchman, Radcliff Group, Mr. Witteveen, Thomas P. Birnie and
Graham K. Owen has invested in chassis which it has leased to Trac Lease.
Radcliff Group and Martin Tuchman share equally in the net income of The Ivy
Group derived from 1,184 chassis owned either directly or indirectly by Radcliff
Group and Mr. Tuchman (the "Contributed Chassis"). In addition, each of Radcliff
Group and Mr. Tuchman receives 28.5% of the net income of The Ivy Group, other
than that derived from the Contributed Chassis. Mr. Witteveen receives 14.3% of
the net income of The Ivy Group, other than that derived from the Contributed
Chassis. In 1996, 17.5% of the aggregate income of The Ivy Group was derived
from the Contributed Chassis and 82.5% was derived from other activities.
Currently, pursuant to equipment lease agreements, Trac Lease leases 7,411
chassis from The Ivy Group for aggregate annual lease payments of approximately
$3.9 million. Such leases either renew automatically unless canceled by either
party prior to the first day of the renewal period or expire on various dates in
1997 or 2000. In August 1990, The Ivy Group pledged approximately 1,400 of the
aforementioned chassis to a financial institution in order to secure a loan in
the amount of $6.5 million, of which approximately $4.4 million was outstanding
as of December 31, 1996. Approximately $2.5 million of the loan was used by The
Ivy Group to purchase 50% of the preferred stock of Trac Lease, with the
remainder used to purchase equipment. In the event of a default by The Ivy Group
under such loan, the Company has agreed to purchase such chassis from the lender
at a price equal to the principal balance of the loan then outstanding. The
terms of all agreements between the Company and The Ivy Group, including rental
rates, are fixed and, in the opinion of the Company's management, are comparable
to terms that the Company would have obtained in arms' length transactions with
unrelated third parties. The Company has been advised by the principals of The
Ivy Group that the personal tax consequences to such principals would make it
inadvisable to terminate the transactions entered into with the Company. The Ivy
Group has entered into an agreement with the Company pursuant to which it has
agreed not to engage in any business activities, except extensions or renewals
of the existing lease agreements described above, that are competitive with the
Company's business activities without the prior written consent of the Company.
On December 30, 1986, Princeton Intermodal Equipment Trust I, a New Jersey
trust ("Princeton Intermodal"), as lessor, and Trac Lease, as lessee, entered
into a lease agreement pursuant to which Trac Lease leases 618 chassis from
Princeton Intermodal at a fixed rate of $2.00 per day for an 11 year term.
Martin Tuchman and Warren L. Serenbetz, directly and indirectly, are among the
beneficiaries of Princeton Intermodal, of which an unaffiliated party is the
trustee. The Ivy Group, Mr. Tuchman and Warren L. Serenbetz hold 3.2% , 32.1%
and 12.9% interests, respectively, in Princeton Intermodal. The terms of the
lease
12
<PAGE> 16
agreement between Princeton Intermodal and Trac Lease, in the opinion of the
Company's management, are comparable to terms that Trac Lease would have
obtained in an arms' length transaction with an unrelated third party. The Ivy
Group entered into a guarantee of all rental payments due from Trac Lease to
Princeton Intermodal under such lease agreement, which guarantee continues for
the length of the lease term.
The Company entered into a Consultation Services Agreement with Radcliff
Group, Inc. ("Radcliff") dated as of January 1, 1992, as amended and restated in
February 1993 pursuant to which Radcliff appointed Warren L. Serenbetz, a
stockholder and director of the Company, as Executive Consultant. The
Consultation Services Agreement was terminated as of January 1, 1995. In
accordance with the terms of the Consultation Services Agreement, Radcliff is
entitled to receive its full annual consultation services fee in the amount of
$491,990 through December 31, 2002 and reimbursement to both the designated
Executive Consultant and his spouse, of all health related costs and expenses
that are not advanced or reimbursed to the Executive Consultant pursuant to
Company medical and dental insurance plans through December 31, 2007.
On August 10, 1992, The Ivy Group borrowed $7.1 million from the Company
evidenced by a promissory note due in July 1997 (the "Ivy Loan"). In connection
with this promissory note, The Ivy Group executed a Chattel Mortgage, Security
Agreement and Assignment under which the Company, as secured party, was granted
a security interest in 4,364 chassis owned by The Ivy Group and was granted an
assignment of all rights to receive rental payments and proceeds related to the
lease and sublease of such chassis (the "Ivy Collateral"). The interest rate on
the promissory note was 11%. Monthly payments totaling 65% of the principal and
interest due on the promissory note were scheduled over a 60-month period, with
the 35% balance of principal and interest to be paid with the final monthly
payment. The Company then pledged the Ivy Collateral to secure an $8 million
loan to the Company with similar repayment terms at a fixed interest rate of
7.5% (the "Bank Loan"). On November 12, 1993, the Company increased its
outstanding balance under the Bank Loan to approximately $12 million by
borrowing an additional $4.8 million at a floating interest rate of LIBOR plus
1.25%. In consideration of The Ivy Group's consent to the Company's use of the
Ivy Collateral to secure the additional borrowing, the interest rate on the Ivy
Loan was reduced to match the Company's borrowing rate of 7.1% under the fixed
rate portion of the Bank Loan.
On March 25, 1996, The Ivy Group borrowed an additional $7 million from the
Company by increasing its outstanding balance under the Ivy Loan from $6.4
million to $13.4 million, reflecting the current estimated loan value of the Ivy
Collateral. Under the terms of the amended Ivy Loan, the entire new balance will
bear interest at LIBOR plus 1.75% repayable over a five year term on an interest
only basis, subject to maintenance of fixed loan-to-collateral value ratios. The
Company was also granted the right to continue to utilize the Ivy Collateral to
secure additional Company financings.
As of March 15, 1996, pursuant to the terms of an Agreement of Merger
between Trac Lease and Trac Lease Merger Corp., a newly formed subsidiary (The
"Trac Merger"), the Company issued an aggregate of 24,390 shares of its 5 3/4%
Cumulative Convertible Preferred Stock ("Interpool Preferred Stock") to Thomas
P. Birnie and Graham Owen, both officers of Trac, and Messrs. Birnie and Owen
surrendered an aggregate of 25,000 shares of Common stock representing 12.5% of
the outstanding common stock of Trac. Following the Trac Merger, Interpool, Inc.
now holds 100% of the outstanding shares of common stock of Trac. As of March
15, 1996, pursuant to the terms of the Trac Merger, the Company also issued
59,664 shares of its Interpool Preferred Stock to The Ivy Group and The Ivy
Group surrendered 2,500 shares of Trac Preferred Stock having a stated value of
$2,500,000 plus accrued, cumulative dividends of $2,392,425. Following the Trac
Merger, no shares of Trac Lease Preferred Stock remain outstanding.
On August 15, 1992, Eurochassis L.P., a New Jersey limited partnership in
which Raoul J. Witteveen is one of the limited partners and the general partner,
entered into a master equipment lease agreement, as lessor, with Trac Lease, as
lessee, pursuant to which Eurochassis L.P. leases 100 chassis to Trac Lease for
an annual lease payment of $91,250. The annual lease term renews automatically
unless canceled by either party prior to the first day of the renewal period.
The terms of such master equipment lease agreement, in the opinion of the
Company's management, are comparable to terms that Trac Lease would have
obtained in an arms' length transaction with an unrelated third party.
13
<PAGE> 17
The Company leases approximately 16,000 square feet of commercial space for
its executive offices in Princeton, New Jersey from 211 College Road Associates,
a New Jersey general partnership. Martin Tuchman holds a direct or indirect
equity interest of 13.85% and Radcliff Group holds a direct or indirect equity
interest of 13.15% in 211 College Road Associates. The annual rental for this
property is approximately $309,000, plus additional amounts for utilities, real
estate taxes and operating and maintenance costs, under a lease expiring in
2001, subject to renewal. In the opinion of the Company's management, rent being
paid under this lease does not exceed rent that the Company would have paid in
an arms' length transaction with any unrelated third party.
As of June 1, 1996, Arthur L. Burns resigned as Vice President of the
Company and Senior Vice President of Interpool Limited and voluntarily
terminated his employment agreement, electing instead to act as the Company's
independent General Counsel and secretary. Accordingly, since that date, Mr.
Burns has not been an employee or executive officer of the Company. For the
period from June through December 1996, Mr. Burns was paid $50,025 for
independent services rendered to the Company as its General Counsel.
STOCK PERFORMANCE GRAPH
The graph below compares cumulative stockholder returns for the Company for
the preceding fiscal year with the Standard & Poor's 500 Stock Index and the Dow
Jones Transportation Index. The graph assumes the investment of $100 at the
commencement of the measurement periods and that all dividends were reinvested.
<TABLE>
<CAPTION>
Measurement Period Dow Jones
(Fiscal Year Covered) 'Interpool, Inc.' S&P 500 Transportation
<S> <C> <C> <C>
5/4/93 100 100 100
Dec-93 128 107 111
Dec-94 95 108 94
Dec-95 116 149 130
Dec-96 153 183 149
</TABLE>
ITEM 2. RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen LLP as the Company's
independent accountants for the fiscal year ending December 31, 1997 ("Fiscal
1997"). Arthur Andersen LLP has served as the Company's independent accountants
since 1988. Services provided to the Company and its subsidiaries by Arthur
Andersen LLP with respect to the fiscal year ended December 31, 1996 included
the audit of the Company's consolidated financial statements, limited reviews of
quarterly reports, services related to filings with the Securities and Exchange
Commission and consultations on various tax and information services matters. A
representatives of Arthur Andersen LLP will be present at the Annual Meeting to
respond to appropriate questions and to make such statements as they may desire.
14
<PAGE> 18
Ratification of the appointment of Arthur Andersen LLP as the Company's
independent accountants for Fiscal 1997 will require the affirmative vote of a
majority of the shares of common stock represented in person or by proxy and
entitled to vote at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" RATIFICATION
OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPANY'S INDEPENDENT
ACCOUNTANTS FOR FISCAL 1997.
OTHER MATTERS
As of the date of this proxy statement, the Company knows of no business
that will be presented for consideration at the Annual Meeting other than the
items referred to above. Proxies in the enclosed form will be voted in respect
of any other business that is properly brought before the Annual Meeting in
accordance with the judgment of the person or persons voting the proxies.
STOCKHOLDER PROPOSALS FOR THE 1998 ANNUAL MEETING
Any proposal of a stockholder intended to be presented at the Company's
1998 Annual Meeting of Stockholders must be received by the Secretary of the
Company, for inclusion in the Company's proxy, notice of meeting and proxy
statement relating to the 1998 Annual Meeting, by February 25, 1998.
FINANCIAL REPORTS
Stockholders who wish to receive the Company's quarterly reports on form
10-Q may call the Company at (609) 452-8900 (between 9 a.m. and 5 p.m. Eastern
Time) or write to Interpool, Inc., Attn: Richard W. Gross, Senior Vice
President, 211 College Road East, Princeton, New Jersey 08540 to be included on
the Company's mailing list.
By Order of the Board of Directors
--------------------------------------
Martin Tuchman
Chairman/Chief Executive Officer
15
<PAGE> 19
INTERPOOL, INC.
211 COLLEGE ROAD EAST
PRINCETON, NEW JERSEY 08540
PROXY -- ANNUAL MEETING OF STOCKHOLDERS -- MAY 21, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints Martin Tuchman and Raoul J. Witteveen
as Proxies, each with the power to appoint his substitute, and hereby
authorizes each of them to represent and to vote, as designated on the reverse,
all the shares of common stock of Interpool, Inc. held of record by the
undersigned, on April 15, 1997, at the Annual Meeting of Stockholders to be
held on May 21, 1997 or any adjournment thereof.
(TO BE SIGNED ON REVERSE SIDE)
<PAGE> 20
PLEASE DATE, SIGN AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF STOCKHOLDERS
INTERPOOL, INC.
MAY 21, 1997
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED
- --------------------------------------------------------------------------------
A /X/ PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
1. ELECTION OF DIRECTORS
<TABLE>
<S> <C> <C>
FOR all WITHHOLD
nominees listed at right AUTHORITY
(except as marked to to vote for all nominees Nominees: Warren L. Serenbetz
the contrary below) listed at right
/ / / / Joseph J. Whalen
</TABLE>
(INSTRUCTION: To withhold authority to vote for any individual nominee, strike
a line through the nominee's name in the list at right.)
2. Proposal to ratify the appointment of Arthur Andersen, LLP as the
independent public accountants of the company for the fiscal year ending
December 31, 1997.
FOR AGAINST ABSTAIN
/ / / / / /
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED IN FAVOR OF ALL NOMINEES LISTED FOR ELECTION AS DIRECTORS AND FOR
PROPOSAL 2.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY IN THE ENCLOSED
ENVELOPE.
SIGNATURE
-----------------------------
DATE
----------------------------------
SIGNATURE
-----------------------------
SIGNATURE, IF HELD JOINTLY
DATE
----------------------------------
NOTE: Please sign exactly as name appears above. When shares are held by
joint tenants, both should sign. When signing as an attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
