UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.__)
Filed by the Registrant ý
Filed by a Party other than the ☐[ ] Registrant
Check the appropriate box:
[ ] | ||
[ ] | 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 §240.14a-12 |
OVERSEAS SHIPHOLDING GROUP, 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)(1) 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 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: |
OVERSEAS SHIPHOLDING GROUP, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
May 30, 2019
To the Stockholders of Overseas Shipholding Group, Inc.:
You are cordially invited to attend the Annual Meeting of Stockholders of Overseas Shipholding Group, Inc. The Meeting is to be held in the Brenner Emory Smoot Training Center at 2000 Barge Avenue, Tampa, FL 33605virtually on Thursday, May 30, 201927, 2021 at 8:3010:00 a.m., Eastern Time ("ET"(“ET”).
The meetingAnnual Meeting will be held for the following purposes:
(1) |
(2) |
(3) |
Stockholders of record at the close of business on April 4, 20191, 2021 are the only stockholders entitled to notice of, and to vote at, the Annual Meeting. The list of stockholders at that record date will be open to thefor examination ofby stockholders for any purpose germane to the Annual Meeting, during ordinary business hours for a period of 10 days prior to the Annual Meeting, at the Company'sCompany’s offices, 302 Knights Run Avenue, Suite 1200, Tampa, Florida. This Proxy Statement and the accompanying proxy will first be sent to stockholders on or about April 16, 2019.
We are taking advantage of the Securities and Exchange Commission rules that allow issuers to furnish proxy materials to their stockholders over the Internet. We believe these rules allow us to provide stockholders with the information they need, while lowering the costs of delivery and reducing the environmental impact of our Annual Meeting. If you received a printed copy of the materials, we have enclosed a copy of the Company'sCompany’s Annual Report on Form 10-K for the year ended December 31, 20182020 with this Notice and the accompanying Proxy Statement.
It is very important that you are represented at the Annual Meeting and that your shares are voted. We urge you to vote as soon as possible by telephone, over the Internet, or by marking, signing and returning your proxy or voting instruction card, even if you plan to attend the Meeting in person. If you attend the Meeting and wish to vote in person, you may withdraw your proxy and vote in person.card. Your prompt consideration is greatly appreciated.
/s/ SUSAN ALLAN | |
Vice President, General Counsel and Corporate Secretary | |
Tampa, Florida | |
April |
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF
PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 30, 201927, 2021
This Notice of Annual Meeting of Stockholders of the Company to be held on May 30, 2019,27, 2021, the Company'sCompany’s Proxy Statement for the 20192021 Annual Meeting of Stockholders and the Annual Report on Form 10-K for the year ended December 31, 20182020 are available at http://www.osg.com/investor-relations.investor-relations.
TABLE OF CONTENTS
REMOTE PARTICIPATION IN ANNUAL MEETING | 1 |
PROXY SUMMARY | 1 |
5 | |
10 | |
13 | |
14 | |
15 | |
25 | |
26 | |
28 | |
29 | |
30 | |
31 | |
32 | |
34 | |
35 | |
38 |
OVERSEAS SHIPHOLDING GROUP, INC.
302 Knights Run Avenue, Suite 1200
Tampa, FL 33602
PROXY STATEMENT
_______________________________________________REMOTE PARTICIPATION IN ANNUAL MEETING
Given the ongoing coronavirus pandemic, related health and travel concerns, and federal, state, and local government actions, our Annual Meeting will be held solely by means of remote communication. While we look forward to the prospect of an increasingly vaccinated population and a return to normalcy, we have determined that holding this Annual Meeting remotely will allow all stockholders to participate while avoiding unnecessary risk to the health of you, our officers and other employees who would attend an in-person Annual Meeting. We have not made any decisions as to whether future annual meetings will be held in person, virtually, or in hybrid form.
To participate in the Annual Meeting, dial (844) 850-0546 for domestic callers and (412) 317-5203 for international callers. Please dial in ten minutes prior to the start of the call. Stockholders and other interested parties can listen to a live webcast of the Meeting from the Investor Relations section of the Company’s website at www.osg.com.
We urge you to vote as soon as possible by telephone or over the Internet. If you wish to vote on the date of the Annual Meeting or to change your vote, you may do so by sending an email to Investor-Relations@osg.com and attaching either your proxy card or your voting instruction form and the legal proxy provided by your bank, broker or other nominee. Your email must be submitted by 10:10 a.m. (ET) on Thursday, May 27, 2021. This information is necessary in order for your vote to be counted.
An audio replay of the Annual Meeting of Stockholder will be available starting at 11:30 a.m. (ET) on Thursday, May 27, 2021 by dialing (877) 344-7529 for domestic callers and (412) 317-0088 for international callers and entering Access Code 10154244.
This summary provides an overview of information contained in the Proxy Statement. This summaryIt is not intended to provide all of the information withinin the Proxy Statement, which we recommend that you should read and consider prior to voting. For a more comprehensive discussion of Overseas Shipholding Group, Inc.'s (the "Company" or "OSG") includingWe also invite you to review our performance in 2018, please also review the Company's Annual Report on Form 10-K for the year ended December 31, 20182020 (the "2018“2020 Form 10-K"10-K”)
OSG qualifies as a Smaller Reporting Company under SEC rules. As a Smaller Reporting Company, we are permitted to omit certain disclosures from this Proxy Statement that are required for larger companies, including some additional disclosures relating to executive compensation. However, we recognize the importance of transparency and, accordingly, have chosen to provide certain compensation-related disclosures that we historically provided but are no longer required to provide.
Voting Matters "Roadmap"
Our stockholders are being asked to vote on the following matters at our 20192021 Annual Meeting:
PROPOSALS | ||
The Board and the Corporate Governance and Risk Assessment Committee believe that each of the | FOR Each Director Nominee | |
PROPOSAL 2. Advisory | ||
We ask our stockholders to cast a non-binding advisory vote on the compensation of the Named Executive Officers named in the Summary Compensation Table in this Proxy Statement. | FOR | |
PROPOSAL 3. Ratification of appointment of the | ||
The | FOR |
2 |
Company Overview
OSG is a leading provider of energy transportation services, delivering crude oil and petroleum products to major oil companies and refiners. OurOSG’s 24 vessel fleet, includesof which 22 are U.S. flag vessels, consists of three crude oil tankers doing business in Alaska, two conventional articulated tug-barge units (“ATBs”), two lightering ATBs, three shuttle tankers, ten medium range tankers, and Articulated Tug Bares, or ATBs, of which 19 nineteen operate under the Jonestwo non-Jones Act and two operate internationally andtankers that participate in the U.S. Maritime Security Program. OSG also owns and operates two Marshall Islands flagged MR tankers, which trade internationally. We provide safe, efficient, and reliable transportation to our customers and strive to ensure the highest standards of safety and environmental compliance throughout our organization.
We have been executingdiligently focused on our long-term strategy thatof eliminating overhead costs while investing in long-term assets, such as new vessels, while seeking to increase shareholder value. OSG has introduced four new and more fuel efficient vessels to our fleet, and expanded our exposure in the Alaskan market with the acquisition of Alaska Tanker Company, LLC in March 2020. The COVID-19 pandemic posed new, unforeseen challenges to our Company and the shipping industry as a whole, which turned our immediate focus to employing additional measures to keep our crew members and shoreside employees safe and healthy, so far, resulted in greater certainty and increased visibility in our financial and operational performance. Our strategy is resulting in success in improving our fleet's earning power while we explore opportunitiesas to grow, and in reducing costs and improving efficiencies without compromising our commitment to safety and quality in our operational performance.
Board Highlights
BOARD OF DIRECTORS | OSG Committee Membership1 | ||||||
Name | Age | Director Since | Primary Occupation | A | C | G | |
Douglas Wheat (Non-Executive Chairman) | 68 | 2014 | Managing partner of Wheat Investments | ||||
Joseph I. Kronsberg | 36 | 2015 | Partner at Cyrus Capital Partners, L.P. | ||||
Anja L. Manuel | 44 | 2017 | Founding partner at RiceHadleyGates LLC | X | X2 | ||
Samuel H. Norton | 60 | 2014 | CEO and President of OSG | ||||
John P. Reddy | 66 | 2018 | Business consultant and private investor | X2 | X | ||
Julie E. Silcock | 63 | 2018 | Co-head of Southwest Investment Banking franchise at Houlihan Lokey | X | X2 | ||
Gary Eugene Taylor | 65 | 2014 | Former member of U.S. Congress | X | X | ||
Ty Wallach | 47 | 2015 | Former partner at Paulson & Co. Inc. | X |
BOARD OF DIRECTORS | OSG Committee Membership | |||||||||||
Name | Age | Director Since | Primary Occupation | A | C | G | ||||||
Douglas Wheat (Non-Executive Chairman) | 70 | 2014 | Managing partner of Wheat Investments | |||||||||
Rebecca DeLaet | 53 | 2020 | Former CFO of O.G. Energy | X | ||||||||
Joseph I. Kronsberg | 38 | 2015 | Partner at Cyrus Capital Partners, L.P. | |||||||||
Anja L. Manuel | 46 | 2017 | Founding partner at Rice, Hadley, Gates & Manuel LLC | X | X* | |||||||
Samuel H. Norton | 62 | 2014 | CEO and President of OSG | |||||||||
John P. Reddy | 68 | 2018 | Former CFO of Spectra Energy and private investor | X* | X | |||||||
Julie E. Silcock | 65 | 2018 | Senior Advisor for CDX Advisors | X | X* | |||||||
Gary Eugene Taylor | 67 | 2014 | Former member of U.S. Congress | X | X |
* Indicates Chair of the Committee
Governance Highlights
OSG is committed to cultivating and sustainingmaintaining leading corporate governance practices. We believe that sound governance policies encourage accountability of the Board and management, improve our standing within our industry, and promote the long-term interests of our stockholders.
Board Leadership Structure & Independence
● | We separate the roles of the CEO and Chairman and have an independent, non-executive Chairman. |
● | Women comprise 37.5% of our Board slate. |
● | All of our Directors and nominees are independent, other than our CEO. |
Board Practices & Oversight
● | Executive sessions without management or non-independent directors present provide independent Directors an opportunity to meet in private regularly. |
● | The average attendance by directors at Board and Committee meetings was over 90%. |
● | Oversight of risk management occurs within each Committee, as well as by the whole Board, and we have a Committee that specifically assesses all Company risks. |
Other Activities
● | We prohibit hedging and pledging of securities owned by Directors and employees. |
● | Our Directors and Officers are required to retain ownership of a certain level of OSG stock in accordance with stock ownership guidelines. |
● | Directors possess a wide range of financial, energy, governance and transportation services experience, resulting in diverse viewpoints, including service on other public and non-profit boards and in the U.S. Congress. |
● | Directors must inform the Corporate Governance and Risk Assessment Committee (the “Governance and Risk Committee”) of any changes in their principal occupation and prior to accepting outside board membership. |
Executive Compensation
Consistent with our goal of securities owned by Directors and employees
Environmental and Social Initiatives - Moving Energy with Integrity
OSG recognizes the extentrisk of climate change and the impact carbon emissions have on the environment. We are committed to operating one of the changessafest, cleanest and most reliable fleets in the industry, and we have executedare devoted to restructureminimizing our executive compensation program.vessels’ environmental impact and ensuring each seafarer’s safe return after a voyage. We comply with applicable regulations of the United States, the International Maritime Organization, and European Union on carbon emissions and periodically explore opportunities to decrease our carbon footprint when economically feasible.
To enhance Board oversight of our environmental and social policies and practices, the Governance and Risk Committee’s charter requires the Committee to conduct quarterly reviews of the Company’s governance, environmental, and social risks.
For the fiscal year ended December 31, 2020, OSG has re-introduced its Sustainability Report. The section "Revisionsreport highlights key capital investments and actions our Company has made to 2019 Compensation Program" withindecrease our environmental impact, provide a safe and healthy work environment, promote a responsible and equitable workplace, and provide quality governance practices. Our policies on Health and Safety, Environmental and Social Responsibility, and Quality can be found on our website. We have outlined a few key components of each of these policies below. To view the
● | Health and Safety Policy - Our goal is to have zero incidents of a significant nature in our workplace. We focus on providing healthy and safe working conditions for both our crews and shoreside employees and seek to accomplish these goals by: |
○ | Following our established Management System, which is designed to promote safe practices in ship operations, prevent damage to the vessels and environment, prevent loss of human life or personal injury, and continuously improve the safety skills of personnel. |
○ | Maintaining a Shipboard Occupational Health and Safety Program. |
○ | Striving to exceed all national and international rules and regulations governing the maritime industry. |
○ | In response to the ongoing COVID-19 pandemic, establishing additional measures to ensure the safety of our employees, both in the office and at sea. These include allowing our shoreside employees to work remotely, and providing additional PPE and implementing enhanced safety protocols for our crews. |
● | Environmental Protection and Social Responsibility Policy - Our policies and operating practices include the following: | |
○ | Endeavoring to ensure that all employees are informed, trained, and committed to complying with the Company’s Environmental Management System. |
○ | Requiring that all crew members certify their understanding and acceptance of the Company’s Environmental Protection and Social Responsibility Policy as a condition of employment. |
(PROPOSAL NO. 1)
The nominees for election at the Annual Meeting are listed below. The nominees were selected by the Board upon the recommendation of the Corporate Governance and Risk Assessment Committee. Unless otherwise directed, proxiesyproxies will be voted for the election of these nominees to serve until the 20202022 Annual Meeting of Stockholders of the Company and until their successors are elected and qualify.
The Corporate Governance and Risk Assessment Committee considers the following criteria for identifying and recommending qualified candidates for membership on the Board, seeking to maintain within these criteria appropriate diversity of individuals on the basis of gender, ethnic heritage, international background and life experiences:
● | judgment, character, integrity, expertise, tenure, skills and knowledge useful to the oversight of the Company’s business; |
● | status as “independent” or “audit committee financial expert” or “financially literate” as defined by the New York Stock Exchange (“NYSE”) and the SEC; |
● | high level managerial, business or other relevant experience, including, but not limited to, experience in the industry in which the Company operates, and, if the candidate is an existing member of the Board, any change in the member’s principal occupation or business associations; |
● | absence of conflicts of interest with the Company; |
● | status as a U.S. citizen for compliance with the Jones Act; and |
● | ability and willingness of the candidate to spend a sufficient amount of time and energy in furtherance of Board matters. |
As part of its annual assessment of Board size, structure and composition, the Corporate Governance and Risk Assessment Committee evaluates the extent to which the Board as a whole satisfies the foregoing criteria. The committee believesCommittee has evaluated the nominees under the above criteria, and this Committee and the Board recommends that the currentstockholders elect all nominees have the requisite character, integrity, expertise, skills, and knowledge to oversee the Company’s business in the best interests of the Company's stockholders. All the nominees named have been evaluated under the criteria set forth above and recommended by the Corporate Governance and Risk Assessment Committee to the full Board for election by stockholders at the Annual Meeting. The entire Board recommends that stockholders elect all nominees. All nomineesWe expect each nominee for election atas a Director to be able to serve if elected. If any nominee is not able to serve, the Annual Meeting were previously elected topersons appointed by the Board byof Directors and named as proxies in the stockholders atproxy materials may vote their proxies for substitute nominees, unless the 2018 Annual MeetingBoard chooses to reduce the number of Stockholders.
Director | |||
Business Experience during the Past Five Years and Other Information | |||
Douglas D. Wheat | Mr. Wheat Skills and Qualifications Mr. Wheat’s finance and legal expertise and experience serving on numerous boards of directors make him a valuable asset to the Board. | ||
Age: 70 Director and Chairman since 2014 |
Rebecca DeLaet | Ms. DeLaet was most recently the Chief Financial Officer of O.G. Energy (“OGE”) from 2018 until December, 2019. OGE is the energy arm of Ofer Global, a private portfolio of international businesses principally focused on shipping, real estate, energy, banking and investments. She served as a member of the Senior Management Committee of Ofer Global from 2004 to 2018. Ms. DeLaet also worked for Zodiac Finance, another division of Ofer Global, from 1990 to 2017 in positions of escalating authority as Vice President, Managing Director, and for the last seven years as President. She served on the Board of Directors and as Chair of the Audit Committee for both New Zealand Oil and Gas and Cue Energy Resources, publicly traded companies listed respectively on the New Zealand and Australian stock exchanges. She is currently the Director and Head of Finance for Team Image Synchronized Skating Team (a not for profit organization), a role which she has had since 2014. Skills and Qualifications Ms. DeLaet’s substantial experience in the shipping industry and her financial expertise qualify her for election to the Board. | |
Age: 53 Director since 2020 Committee: Compensation |
Director | Business Experience during the Past Five Years and Other Information | ||
Joseph | Mr. Kronsberg has served in various roles at Cyrus Capital Partners, L.P. since 2006, and he is currently a Partner responsible for certain investments in the financial, shipping and energy sectors. Previously, Mr. Kronsberg worked at Greenhill & Co. as a generalist in its Mergers & Acquisitions and Restructuring departments. He currently serves as a Director of International Seaways, Inc. (a former wholly-owned Skills and Qualifications Mr. Kronsberg’s financial expertise and experience in investment management make him a valuable asset to the Board. | ||
Age: 38 Director since 2015 | |||
Anja L. Manuel | Since 2009, Ms. Manuel has University, where she now lectures. Skills and Qualifications Ms. | ||
Age: 46 Director since 2017 Committees: Governance (Chair) Audit |
Director | Business Experience during the Past Five Years and Other Information | ||
Samuel H. Norton | Mr. Norton was appointed Chief Executive Officer and President of Skills and Qualifications Mr. Norton’s substantial experience in the shipping industry makes him a valuable asset to the Board. | ||
Age: 62 Director since 2014 |
John P. Reddy | Mr. Reddy is currently a business consultant and private investor. From 2009 until Skills and Qualifications Mr. | ||
Age: 68 Director since 2018 Committees: Audit (Chair) Governance |
Director | Business Experience during the Past Five Years and Other Information | ||
Julie E. Silcock | Ms. Silcock Skills and Ms. Silcock’s extensive experience in equity and debt capital market transactions and in mergers and acquisitions, as well as her service on the boards of publicly traded companies, | ||
Age: 65 Director since 2018 Committees: Compensation (Chair) Audit |
Gary Eugene Taylor | Mr. Taylor is a former member of the U.S. Congress, having served for 21 years until January 2011. Mr. Taylor served as a senior member of the House Armed Services Committee and most recently as Chairman of the Seapower Subcommittee, providing oversight of expenditures for Navy and Marine Corps programs. As Chairman, Mr. Taylor worked with senior Navy leadership to develop a 30-year shipbuilding plan. As a member of the Merchant Marine Committee, Mr. Taylor helped guide passage of the Oil Pollution Act of 1990, the U.S. law that regulates the shipment of petroleum products in U.S. waters. Mr. Taylor also served as a senior member of the House Transportation and Infrastructure Committee. He co-chaired the Shipbuilding Caucus, the Coast Guard Caucus, the National Guard and Reserve Caucus and the Expeditionary Warfare Caucus. After leaving Congress, Mr. Taylor worked on business development for E.N. Bisso in the ship assist business on the Mississippi River. From September 2011 until December 2013, Mr. Taylor served as a consultant for Navistar Defense on the Mine Resistant Ambush Protected vehicle program. Mr. Taylor served as a Commissioner on the Hancock County Port and Harbor Commission from 2012 to 2014, providing oversight for the Port Bienville Industrial Park and Stennis International Airport in Hancock County, Mississippi. He is a graduate of Tulane University. Skills and Qualifications Mr. Taylor’s extensive expertise in shipping regulation makes him a valuable asset to the Board. | ||
Age: 67 Director since 2014 Committees: Governance Audit | |||
The Board recommends a vote "FOR"“FOR” the election of each of the nominees for director named in this Proxy Statement.
Corporate Governance Guidelines. The Board has adopted Corporate Governance Guidelines to assist insupport the effective functioning of the Board and its committees, to promote the interests of all stockholders, and to ensure a common set of expectations as to how the Board, its various committees, individual directors and management should perform their functions. The Board believes that ethics and integrity cannot be legislated or mandated by directive or policy and that the ethics, character, integrity and values of the Company'sCompany’s directors and senior management remain the most important safeguards in quality corporate governance. The Corporate Governance Guidelines are posted on the Company'sCompany’s website, www.osg.com, and are available in print upon request. The website and the information contained on that site, or connected to that site, are not incorporated by reference in this proxy statement.Proxy Statement. Under the Corporate Governance Guidelines, each director is expected to attend all Board meetings and all meetings of committees of which the director is a member. Meeting materials are provided to Board and Committee members prior to meetings, and members are expected to review such materials prior to each meeting.
Board Leadership Structure. The Corporate Governance Guidelines provide that the Board selects the Chief Executive Officer ("CEO") of the Company and may select a Chairman of the Board (the "Chairman") in the manner it considers in the best interests of the Company. The Guidelines provide that the Chairman may be a non-management director or the CEO.
The Company currently separates the role of CEO and Chairman, who is currently an independent Director. The CEO and the Chairman are in frequent contact with one another and with senior management of the Company. They provide advice and recommendations to the full Board for its consideration. They each review in advance the schedule of Board and committee meetings and establish the agenda for each Board meeting in order to ensure thataddress the interests and requirements of the stockholders, the directors and other stakeholders are appropriately addressed.stakeholders. The Board believes that the current leadership structure, including the individuals holding the leadershiprleadership positions, is in the best interests of stockholders.
The Board, primarily through its Corporate Governance and Risk Assessment Committee, (the "Governance and Risk Committee"), periodically reviews the Company’sBoard’s leadership structure to determine if it remains appropriate in light of the Company’s specific circumstances and needs, current corporate governance standards, market practices and other factors the Board considers relevant. The Board retains the right to combine the CEO and Chairman roles in the future if it determines that such a combination would be in the best interests of the Company and its stockholders.
Board Refreshment. The Governance and Risk Committee considers board refreshment in identifying and recommending to the Board qualified candidates for the Board. During the nomination process, the Governance and Risk Committee assesses whether the current directors continue to hold the qualities necessary to best serve the interest of the stockholders. Such an approach allows the Company to respond to changes to adapt as necessary in a modern market, and to be more flexible and adaptive to both immediate and long-term needs.
Independence.Under the Corporate Governance Guidelines, which incorporate the standards established by the NYSE, the Board must consist of a majority of independent directors. As determined by the Board, as of the date of this Proxy Statement, all of the nominees other than Mr. Samuel H. Norton have been determined to be independent for purposes of service on the Board. No relationships were identified or considered that would bar any of them from being characterized as independent. EachThe Board also reviews, every quarter, the Board reviews relationships that directors may have with the Company to determine whether there are any material relationships that would preclude a director from being independent. See "Related Party Transactions" below.
Executive Sessions of the Board. To ensure free and open discussion and communication among the directors, the Corporate Governance Guidelines provide that directors meet in executive session without management present at each of the regular meetingsmeeting of the Board, and that at least one of such executive sessionssession is for only those directors who are independent.non-management directors. A non-executive Chairman must chair these executive sessions. Any non-management director can request that an additional executive session limited to independent directors be scheduled.
Board Oversight of Risk Management. While the responsibility for managing the Company'sCompany’s material risks lies with the management, team, the Board provides oversight of risk management directly and also through its committees. Each committee reports its activities and considerations to the full Board at every regularly scheduled quarterly meeting. The Board as a whole reviews the risks associated with the Company'sCompany’s strategic plan at an annual strategic planning session and periodically throughout the year as part of its consideration of the strategic direction of the Company.
At the committee level, the Audit Committee regularly reviews the financial statements and financial and other internal controls. Further, the Audit Committee schedules private sessions individually with certain members of management, with the
The Governance and Risk Assessment Committee manages risk associated with Board independence, corporate governance, and potential conflicts of interest, as well as oversight over non-financial risk assessmentsrisks associated with the Company'sCompany’s operations.
The Human Resources and Compensation Committee (the "Compensation Committee"“Compensation Committee”) annually reviews executive compensation policies and practices, and employee benefits, and associated risks. The Compensation Committee conducts annual assessments of any risks associated with OSG'sOSG’s compensation policies and practices and has concluded that such policies and practices do not, individually or in the aggregate, create risks reasonably likely to have a material adverse impact on the Company.
Both the Audit and Compensation Committees also rely on the advice and counsel of the Company'sCompany’s independent registered public accountants and independent compensation consultants, respectively, to raise awareness of any risk issues that may arise during their reviews of the Company'sCompany’s financial statements, audit work and executive compensation policies and practices, as applicable.
Managing risk is an ongoing process inherent in all decisions made by management. The Company has an enterprise risk management program that is designed to ensure that risks are taken knowingly and purposefully. Management is responsible for assessing such risks and related mitigation strategies for all material projects and initiatives of the Company submitted for consideration ofby the Board. The risk assessment process identifiesseeks to identify the primary risks facing the Company and seeks to prioritize these risks, as well as the actions necessary to mitigate and balance these risks.
Meetings of the Board. The Board held sixfour meetings during 2018.2020. Each directorsdirector attended at leastover 90% of the total number of meetings of the Board and Board committees of which the director was a member.
Annual Meetings of Stockholders. Directors are not required, but are strongly encouraged, to attend the annual meetingsmeeting in person or telephonically. All of the directors of the Company attended theour 2020 Annual Meeting of Stockholders in 2018.remotely.
Communications with Board Members. Interested parties, including stockholders, may communicate with any director, with the Chairman of the Board or with the non-management directors as a group by sending a letter to the attention of such director, or the non-management directors as a group, as the case may be, in care of the Company’s Corporate Secretary, 302 Knights Run Avenue, Suite 1200, Tampa, Florida 33602. The Corporate Secretary opens, reviews and forwards all such correspondence (other than advertisements and other solicitations) to directors and provides any communication addressed to the Board to the director(s) most closely associated with the nature of the request based on Committee membership and other factors.
Code of Business Conduct and Ethics; Other Compliance Policies. The Company has adopted a Code of Business Conduct and Ethics, which is an integral part of the Company'sCompany’s compliance program and embodies the commitment of the Company and its subsidiaries to conduct operations in accordance with the highest legal and ethical standards. This Code applies to all of the Company'sCompany’s officers, directors and employees. The Company also has an Insider Trading Policy that prohibits the Company’s directors and employees from purchasing or selling securities of the Company while in possession of material non-public information or otherwise using such information for their personal benefit. The Company has an Anti-Bribery and Corruption Policy that memorializes the Company'sCompany’s commitment to adhere faithfully to both the letter and spirit of all applicable anti-bribery legislation in the conduct of the Company'sCompany’s business activities worldwide. The Code of Business Conduct and Ethics, the Insider Trading Policy and the Anti-Bribery and Corruption Policy are posted on the Company'sCompany’s website, www.osg.com, and are available in print upon request. The website and the information contained on that site, or connected to that site, are not incorporated by reference in this Proxy Statement.
Prohibition Against Hedging and Pledging. The Company'sCompany’s Insider Trading Policy prohibits the Company'sCompany’s directors and employees from hedging and pledging their ownership of securities of the Company, including by investing in options, puts, calls, short sales, future contracts, or other derivative instruments relating to Company securities, regardless of whether such persons have material non-public information about the Company. The Company'sIn addition, the Company’s Non-Employee Director Incentive Compensation Plan and Management Incentive Compensation Plan for Management prohibit incentive awards from being pledged.
Other Directorships and Significant Activities. The Company values the experience directors bring from other boards of directors on which they serve, but recognizes that those boards also presentboard service presents significant demands on a director'sdirector’s time and availability and may present conflicts and legal issues. The Corporate Governance Guidelines provide that non-management directors refrain from serving on the boards of directors of more than four publicly-traded companies (other than the Company
The Corporate Governance Guidelines require the CEO and other members of senior management, whether or not they are members of the Board, to receive the approval of the Governance and Risk Committee before accepting any outside board membership. The Corporate Governance Guidelines prohibit the CEO from serving on the board of directors of more than one publicly traded company (other than the Company or a company in which the Company has a significant equity interest).
If a director'sdirector’s principal occupation or business association changes substantially, that director is required by the Corporate Governance Guidelines to inform the Chairman of the Governance and Risk Committee of the change and offer to resign from the Board. In such case, such Committee must recommend to the Board the action, if any, to be taken with respect to the offer of resignation, taking into account the appropriateness of continued Board membership.
Committees
The CompanyBoard has three standing committees of its Board:committees: the Audit Committee, the Governance and Risk Committee, and the Compensation Committee. Each of these committees has a charter that is posted on the Company'sCompany’s website, www.osg.com, and is available in print upon request.
Audit Committee. The Audit Committee is required to have no fewer than three members, all of whom must be and are independent directors in accordance with the SEC and NYSE rules, as well as under the standards set forth in the Company’s Corporate Governance Guidelines. During 2018,2020, the Committee consisted of Mr. John P. Reddy (Chair) (from his appointment in June 2018), Ms. Anja L. Manuel, and Ms. Julie E. Silcock (from her appointment in June 2018).Silcock. The Board affirmatively determined that each member of the Committee was independent, and determined that Mr. Reddy and Ms. Silcock are audit committee financial experts, and that Ms. Manuel is financially literate, both as defined by rules of the SEC and NYSE. The Audit Committee met 10nine times in 2018.2020. The Committee meets frequently in executive session, without any members of management present, to confer with the independent registered public accounting firm and internal auditors.
The Audit Committee oversees the Company'sCompany’s accounting, financial reporting process, internal controls, and audits and consults with management, internal auditors and the Company'sCompany’s independent registered public accounting firm on, among other things, matters related to the annual audit, the accounting principles applied to the financial statements, and the oversight of financial risk associated with the Company'sCompany’s operations.
The Committee retains the independent registered public accounting firm, subject to stockholder ratification (although the stockholder vote is not binding). The Committee may in its sole discretion terminate the engagement of the firm and direct the appointment of another independent auditor at any time during the year if it determines that such an appointment would be in the best interests of the Company and its stockholders. The Committee maintains direct responsibility for the compensation and oversight of the independent registered public accounting firm and evaluates its qualifications, performance and independence. The Committee has established policies and procedures for the pre-approval of all services provided by the independent registered public accounting firm.
Corporate Governance and Risk Assessment Committee. The Governance and Risk Committee is required to have no fewer than three members, all of whom must be and are independent directors under the standards set forth in the Corporate Governance Guidelines. During 2018,2020, the Committee consisted of Ms. Anja L. Manuel (Chair), and Messrs. John P. Reddy (from his appointment in June 2018) and Gary E. Taylor. The Board affirmatively determined that each member of the Committee was independent. The Committee met fivefour times in 2018.2020.
The Governance and Risk Committee provides oversight over the non-financial risks associated with the Company'sCompany’s operations, including its vessels'vessels’ adherence to environmental and regulatory requirements.
The Governance and Risk Committee evaluates prospective nominees for election to the Board who are identified or referred by other Board members, management, stockholders or external sources and all self-nominated candidates, and recommends to the Board those individuals who the Committee believes are best qualified to serve on the Board. The Committee uses the same criteria for evaluating candidates nominated by stockholders and self-nominated candidates as it does for those proposed by other Board members, management and search consultants. This Committee also develops and recommends to the Board the Corporate Governance Guidelines and leads the annual review of the Board'sBoard’s performance.
The Committee also oversees the Company’s environmental, social, and governance policies and practices.
Compensation Committee. The Compensation Committee is required to have no fewer than three members, all of whom must be and are independent directors under the standards set forth in the Company’s Corporate
The Compensation Committee establishes, oversees, and carries out the Company’s compensation philosophy and strategy, and assesses compensation-related risks. It implements the Board'sBoard’s responsibilities relating to compensation of the Company’s executive officers and ensuresseeks to ensure that they are compensated in a manner consistent with the philosophy and competitive with its peers. This Committee monitors and oversees the preparation of the Compensation Discussion and Analysis“How We Compensate Our Executives” section for inclusion in the Company’s annual proxy statement and prepares an annual report on executive compensation.
Related Party Transactions
Related party transactions may present potential or actual conflicts of interest andor create the appearance that decisions are based on considerations other than the best interests of the Company and its stockholders. Our Code of Business Conduct and Ethics requires all directors, officers and employees who may have a potential or apparent conflict of interest to disclose fully all the relevant facts to OSG'sOSG’s legal department any time they arise. Every quarter, our Corporate Secretary inspectsdetermines whether any related party transactions have occurred and reports the findings to the Audit Committee. In addition to this reporting requirement, in order to affirmatively seek to identify related party transactions, each year we require our directors and executive officers to complete questionnaires identifying any transactions with the Company in which the director or officer has an interest. Any proposed transaction or relationship that could be viewed as a potential conflict is carefully reviewed, with those determined to be related party transactions reported to the Board for consideration. If the related party is a director, that director will not participate in the discussion. In deciding whether to approve the proposed related party transaction, the Board will determine whether the transaction is on terms that could be obtained in an arm'sarm’s length transaction with an unrelated third party and if the transaction is in the best interest of the stockholders and the Company. If the related party transaction is not on such terms, it will not be approved. There were no related party transactions in 2018.2020.
12 |
Market data is reviewed to determine the amount and structure of director compensation. The Company'sCompany’s non-employee directors receive annual cash retainers each year. Followingyear, with additional cash retainers for service as a reviewcommittee member or chair or for services as Board Chair. In addition, each non-employee director receives an annual award of market data for director compensation,restricted stock units, or RSUs, under the Board determined it be in the best interest of the Company to reduce the compensation paid to OSG's non-management directors. In June of 2018, the Company adopted new annual cash retainer rates, which were effective as of July 1, 2018:
Board Position | Annual cash retainer from June 2017 until June 2018 | Annual cash retainer since July 1, 2018 | Annual stock awards from June 2017 until June 2018 | Annual stock awards since July 1, 2018 |
Board membership (non-management directors only) | $80,000 | $65,000 | $100,000 | $85,000 |
Board Chair | $172,000 | $115,000 | $180,000 | $127,000 |
Audit Committee Chair | $20,000 | $18,000 | ||
Audit Committee member | $10,000 | $9,000 | ||
Compensation Committee Chair | $20,000 | $14,000 | ||
Compensation Committee member | $10,000 | $8,000 | ||
Governance and Risk Committee Chair | $13,000 | $11,000 | ||
Governance and Risk Committee member | $6,500 | $7,000 |
For 2020, the following sets forth the annual cash retainers and RSU values for the Company’s non-employee directors:
Board Position | Annual cash retainer | Annual RSU awards | ||||||
Board membership (non-management directors only) | $ | 65,000 | $ | 85,000 | ||||
Board Chair | $ | 115,000 | $ | 127,000 | ||||
Audit Committee Chair | $ | 18,000 | n/a | |||||
Audit Committee member | $ | 9,000 | n/a | |||||
Compensation Committee Chair | $ | 14,000 | n/a | |||||
Compensation Committee member | $ | 8,000 | n/a | |||||
Governance and Risk Committee Chair | $ | 11,000 | n/a | |||||
Governance and Risk Committee member | $ | 7,000 | n/a |
The following table shows the total compensation paid to the Company'sCompany’s non-employee directors during 2018:
Name | Retainers earned or Paid in Cash ($)(1) | Stock Awards ($) FMV | Total ($) | ||||
Joseph I. Kronsberg(3) | 72,500 | 85,000 | (2) | 157,500 | |||
Anja Manuel | 89,000 | 85,000 | (2) | 174,000 | |||
John P. Reddy(4) | 45,000 | 85,000 | (2) | 130,000 | |||
Julie E. Silcock(4) | 44,000 | 85,000 | (2) | 129,000 | |||
Gary Eugene Taylor | 93,250 | 85,000 | (2) | 178,250 | |||
Ty E. Wallach(5) | 18,250 | 63,750 | (2)(5) | 82,000 | |||
Douglas D. Wheat | 143,500 | 127,000 | (2) | 272,500 | |||
Former Members of the Board | |||||||
Timothy J. Bernlohr(6) | 55,000 | 55,000 | |||||
Ronald Steger(6) | 53,250 | 53,250 |
Name | Retainers earned or Paid in Cash ($)(1) | Stock Awards ($) FMV(2) | Total ($) | |||||||||
Rebecca DeLaet(3) | 37,500 | 85,000 | 122,500 | |||||||||
Joseph I. Kronsberg(4) | 65,000 | 85,000 | 150,000 | |||||||||
Anja Manuel | 85,000 | 85,000 | 170,000 | |||||||||
John P. Reddy | 90,000 | 85,000 | 175,000 | |||||||||
Julie E. Silcock | 88,000 | 85,000 | 173,000 | |||||||||
Gary Eugene Taylor | 80,000 | 85,000 | 165,000 | |||||||||
Ty E. Wallach(5) | 73,000 | 85,000 | 158,000 | |||||||||
Douglas D. Wheat | 115,000 | 127,000 | 242,000 |
(1) | Consists of annual retainers for Board and/or Committee service. |
(2) | The grants, made |
37,800 time-based RSUs. | |
(3) | Ms. DeLaet joined the Board in May 2020. |
(4) | In accordance with Mr. |
2020. | |
(5) | Mr. Wallach |
The Company encourages stock ownership by directors in order to align their interests of directors with the long-term intereststhose of the Company'sCompany’s stockholders. To further stock ownership by directors, the Board believes that regular grants of equity compensation should be a significant component of director compensation.
The Board has in place stock ownership guidelines for non-employee directors. Under the stock ownership guidelines, each non-employee director is expected within five years of becoming a director to own shares of the Company'sCompany’s Class A Common Stock whosewith a market value equalsequal to at least three times the annual cash retainer for Board service.
This Compensation Discussion and Analysis ("CD&A")section provides information regarding the compensation program for 20182020 for individuals who served as executive officers and who are listed in the Summary Compensation Table (collectively, the "Named“Named Executive Officers"Officers” or "NEOs"“NEOs”). Our NEOs for 20182020 are:
Name | ||
Position | ||
Mr. Samuel H. Norton | President, Chief Executive Officer and Director | |
Mr. Richard L. Trueblood | Vice President and Chief Financial Officer | |
Mr. Patrick J. | Vice President and Chief Operations Officer | |
Mr. Damon M. Mote | Vice President and Chief Administrative Officer | |
As noted elsewhere in this Proxy Statement, OSG qualifies as a “Smaller Reporting Company,” or “SRC,” under SEC rules. As a Smaller Reporting Company, we are permitted to provide reduced disclosures in this Proxy Statement, including those relating to executive compensation. Among other things, we are no longer required to have a Compensation Discussion and Analysis. Nevertheless, we are providing the following information to be transparent to our stockholders on how we compensate our executives. This section describes our compensation philosophy, the objectives of our executive compensation program and policies, the elements of the compensation program and how each element fits into our overall compensation philosophy and strategy.
Executing on Strategy: Our 20182020 Performance
The COVID-19 pandemic and its impacts on the courseworld consumed much of 2018, we continued2020. The performance measures for our compensation program for 2020 were set by our Compensation Committee prior to executethe onslaught of the pandemic in the United States and prior to any known impacts on our business. Nevertheless, our NEOs were able to react and take proactive measures to protect the safety and health of our crew members and shoreside employees while continuing to provide the critical services to our customers. At the same time, the NEOs focused successfully on executing on our long-term strategy, resulting in greater certainty and increased visibility in our financial and operational performance for 2019. We improved our fleet's earning power and reduced our spot market exposure by securing profitable time charters for the majority ofbusiness strategy. Revenues from our fleet throughout 2019,increased 17.8% on a GAAP basis, primarily as a result of revenues contributed by our four newly built vessels - two MR tankers and two barges - and by reducing and refinancingthree crude oil tankers we acquired in March 2020. Throughout 2020, our debt. Prevailing rates recently obtained for our conventional tankers are approximately 30% above our 2018 average, a signal that bodes well for a business characterized by high operating leverage.fleet was largely committed under long-term charters with secure revenue streams. We further cemented our leadership position across the niche businesseswere successful in which we operate, maintaining our foundation of strong, stable contracts as we explore opportunitiescontinuing to grow. We succeeded in reducingreduce costs and improving efficiencies acrossachieve synergies with our organization without compromising our commitment to safety and qualityacquisition of operational performance.the Alaska Tanker Company. Safety and quality remain the key focuses of our operations. Our corporate culture is geared towards continuously seeking to achieve the highest standards in protecting the environment and ensuring the health and safety of all of our employees. We believe success in this goal is paramount in allowing
The narrative that follows describes the Companycompensation program for 2020, which was designed by our Compensation Committee to sustain its good standing in the community ofincentivize our customers,executives to achieve our peersstrategic and our regulators.
Say on Pay Results - Consideration of Stockholder Feedback
At our 20182020 annual meeting of stockholders, 64.24%97.69% of the stockholders who voted on the say-on-pay proposal were in favor of our executive compensation program. In response toWe believe that this 2018 advisory vote, as well as a desire to exchange views withlevel of support reflect our stockholders, the Company, with the strong support of the Board, reached out to some of our larger stockholders to gain insight into the concerns they had with our compensation practices. In general, the feedback we received related to concerns with our CEO's compensation structure, particularly the lack of long-term, performance-based incentives, as well as disclosures of our compensation goalsstockholders’ belief that were not sufficiently transparent. In response to this feedback, we implemented a number of key changes to our compensation program is effective and practices specifically to address and ameliorate these concerns. Followingreasonable.
Summary of the implementation of these changes, we are again reaching out to the stockholders to discuss our revised CEO compensation package and the further improvements we have implemented in 2019 to our compensation structure (see "Revisions made to 20192020 Compensation Program").
The modifications we have made affect the compensation packages of our CEO and our other NEOs, and include the following:
The following table below summarizes the compensation target levels approved by the Committee for 2019.
2020.
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Our Executive Compensation Philosophy and Practices
We believe that a well-designed compensation program is a powerful tool to attract, motivate, retain and reward top executive and managerial talent and that it should also align the interests of our executives with those of our stockholders. We have structured our compensation program to drive and support these objectives:
Overall Objectives | – | Attract, motivate, retain and reward | |||
– | Align the interests of our executives with those of our stockholders. | ||||
– | Support the long-term retention of the Company’s executives to maximize continuity of management and overall effectiveness. | ||||
– | Compensate each executive within the range of competitive practice (1) within the marketplace for talent in which we operate; (2) based upon the scope and impact of his or her position as it relates to achieving our corporate goals and objectives; and (3) based on the potential of each executive to assume increasing responsibility within the Company. | ||||
– | Discourage excessive or imprudent risk-taking. | ||||
– | Reward the achievement of both the short-term and long-term strategic objectives necessary for sustained optimal business performance. | ||||
Pay Mix Objectives | – | Provide a mix of both fixed and variable (“at-risk”) compensation, each of which has a different time horizon and payout form (cash and equity), to reward the achievement of annual and sustained, long-term performance. | |||
– | Use our incentive compensation program and plans to align the interests of our executives with those of our stockholders by linking incentive compensation rewards to the achievement of performance goals that maximize stockholder value by: | ||||
* | ensuring that our compensation program is consistent with, and supportive of, our short- and long-term strategic, operating and financial objectives. | ||||
* | placing a significant portion of our executives’ compensation at risk, with payouts dependent on the achievement of both corporate and individual performance goals, which are set by the Compensation Committee. | ||||
* | encouraging balanced decision-making by employing a variety of performance measures to avoid over-emphasis on the short-term or any one metric. |
15 |
Executive Compensation Practices: What We Do and What We Do Not Do
The following table summarizes some of the key features of our executive compensation program.
What We Do | What We | |||
Utilize compensation benchmarking - | No hedging and no pledging - Board members, | |||
No perquisites - | ||||
Pay for performance - | No automatic or guaranteed pay - | |||
No tax gross ups - | ||||
Compensation recoupment policies - We maintain a strict compensation recoupment (clawback) | No special retirement programs - | |||
Stock ownership guidelines - Our | No stock option re-pricing - We do not allow discounted stock options, reload stock options or stock option re-pricing without stockholder approval. | |||
Independent compensation consultant - The | No dividends on unvested equity- Dividend equivalents are accrued but not paid on all unvested equity grants. For Performance-based RSUs |
16 |
Compensation Risk Mitigation
The Compensation Committee annually assesses risks that may be present in our compensation program and has concluded that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the Company. Because the Compensation Committee believes that a significant portion of our NEOs’ total compensation should be variable and “at risk”, the Committee uses a balancemix of performance measures and metricsgoals in our incentive compensation program that seeks to balance our short- and long-term goals and to discourage excessive or inappropriate risk-taking by eliminating any inducement to over-emphasize one goal to the detriment of others. To further mitigate excessive risk taking, we have adopted the following:
Stock Ownership Guidelines | Our Corporate Governance Guidelines include stock ownership guidelines for our directors and executives. The minimum levels of ownership for each position are as follows: | ||||
Value if Shares Owned (Multiple of | |||||
Position | Salary / Annual | ||||
Non-Employee Directors | 3x (Annual Retainer) | ||||
President / Chief Executive Officer | 5x | ||||
Chief Financial Officer | 3x | ||||
1.5x | |||||
Directors and | |||||
For purposes of these stock ownership guidelines, ownership comprises all shares of Class A Common Stock held by the director or officer, their spouse, and | |||||
- Shares deemed to be beneficially owned under federal securities laws; | |||||
- Any time-based restricted stock or RSUs awarded (whether or not vested); | |||||
- Any vested, in-the-money stock options; and | |||||
- Any stock held for the | |||||
Stock Holding Requirements | Mr. Norton must hold all stock that was granted with immediate vesting for three | ||||
Recoupment | Our Incentive Compensation Recoupment Policy | ||||
No Hedging | Our Insider Trading Policy prohibits hedging, including investing in options, puts, calls, short sales, futures contracts, or other derivative instruments relating to Company securities, regardless of whether such persons have material nonpublic information about the Company. | ||||
No Pledging | Our Insider Trading Policy and our stock incentive plans prohibit pledging by our non-employee directors and all | ||||
Equity Plan Features | Our stock incentive plans do not permit repricing or cash buyouts of underwater options or stock appreciation rights without stockholder approval. The Compensation Committee believes these plans are structured so as to avoid problematic pay practices and do not contain features that could be detrimental to stockholder interests. |
17 |
Roles in Setting Executive Compensation
Role of the Compensation Committee
The primary role of our Compensation Committee, which consists entirely of independent directors, is to establish our compensation philosophy and strategy and to provide that all of our executives are compensated in a mannerwith compensation opportunities consistent with the articulated philosophy and strategy. The Committee takes many factors into account when making compensation decisions with respect to the executive officers,our NEOs, including the individual’s performance and experience; the ability of the individual to affect our long-term growth and success; our overall performance; internal equity among the NEOs; and external, publicly available market data on competitive compensation practices and levels. The Committee typically will establish the annual compensation program during the first quarter of each fiscal year, setting specific annual and long-term Company goals and designing the compensation program for that year to support and reward the achievement of those goals. In setting the compensation for our NEOs, other than the CEO, the Committee considers, among other things, the recommendations of our CEO. The Committee is, however, solely responsible for making the final decision on the compensation of our NEOs.
The Compensation Committee meets in executive session at least on a quarterly basis but as often as necessary or indicated by events for discussion or decisions regarding executive compensation.
Role of Compensation Consultant
The Compensation Committee engaged Lyons Benenson & Company Inc. (“LB&Co.”&Co”) in 20182020 as its independent compensation consultant to assist and advise the Committee on all aspects of the Company’s executive and director compensation programs and related corporate governance matters. LB&Co.&Co does not provide other services to the Company or its NEOs. LB&Co.&Co was retained directly by the Committee, which, in its discretion, has the sole authority to select, approve, retain, terminate and oversee its relationship with its consultant. In selecting its compensation consultant, the Committee considered the independence of LB&Co.&Co in accordance with the standards of the NYSE, applicable rules and regulations of the SEC and other laws relating to the independence of advisors and consultants. The Committee determined that the work of LB&Co.&Co did not raise any conflict of interest in 2018.
A representative of LB&Co. attended or participated by teleconference in all meetings of the Compensation Committee in 2018.
Role of the CEO in Setting Compensation
Decisions relating to the CEO’s performance and compensation are made by the Compensation Committee in executive session without the CEO present.session. In making determinations regarding compensation for the other NEOs, the Committee generally considers the recommendations of the CEO, and the advice received from LB&Co. In making his recommendations, the CEO evaluates the performance of each executive, considers each executive’s compensation in relation to our other officers and executives and assesses retention risks. The Committee then reviews, modifies (as appropriate) or approves these recommendations and either reports the results to the Board or recommends actions for the Board to approve.
18 |
Components of companies that the Compensation Committee believes to be an appropriate compensation reference group (the “Peer Group”). The Committee periodically reviews the Peer Group to affirm that it is comprised of companies that are similar to us in terms of industry focus, scope of operations, size (in terms of revenues and market capitalization), and the competitive marketplace for talent.
Company | Revenue for FY2017 ($ in millions) | Company | Revenue for FY2017 ($ in millions) | |||||
Blueknight Energy Partners, L.P. | $ | 182 | Martin Midstream Partners L.P. | $ | 946 | |||
Eagle Bulk Shipping Inc. | $ | 237 | Matson, Inc. | $ | 2,047 | |||
Genco Shipping & Trading Limited | $ | 210 | SemGroup Corporation | $ | 2,082 | |||
Holly Energy Partners, L.P. | $ | 454 | SEACOR Holdings Inc. | $ | 578 | |||
Hornbeck Offshore Services, Inc. | $ | 191 | Seacor Marine Holdings Inc. | $ | 174 | |||
International Seaways, Inc. | $ | 290 | TC PipeLines, L.P. | $ | 546 | |||
Kirby Corporation | $ | 2,214 | ||||||
Median revenues of Industry Peer Group | $ | 454 |
2018 Florida Market Peer Group | ||||||||
Company | Revenue for FY2017 ($ in millions) | Company | Revenue for FY2017 ($ in millions) | |||||
Beasley Broadcast Group, Inc. | $ | 232 | Perry Ellis International, Inc. | $ | 861 | |||
Cross Country Healthcare, Inc. | $ | 865 | PetMed Express, Inc. | $ | 249 | |||
FARO Technologies, Inc. | $ | 361 | Rayonier Advanced Materials Inc. | $ | 961 | |||
HCI Group, Inc. | $ | 244 | RTI Surgical, Inc. | $ | 280 | |||
Health Insurance Innovations, Inc. | $ | 251 | Ruth's Hospitality Group, Inc. | $ | 415 | |||
Heritage Insurance Holdings, Inc. | $ | 407 | SEACOR Holdings Inc. | $ | 578 | |||
Kforce Inc. | $ | 1,358 | Sun Hydraulics Corporation | $ | 343 | |||
Marine Max, Inc. | $ | 1,052 | Superior Group of Companies, Inc. | $ | 267 | |||
NeoGenomics, Inc. | $ | 259 | The Hackett Group, Inc. | $ | 263 | |||
NV5 Global, Inc. | $ | 333 | United Insurance Holdings Corp. | $ | 654 | |||
Median revenues of Florida Market Peer Group | $ | 352 |
The Compensation Committee reviews each element of compensation annually to ensure alignment with our compensation philosophy and objectives, as well as to assess our executive compensation program and levels relative to the competitive landscape. Our executive compensation program consists of the following:
Elements | What It Is | Objective/ Purpose | ||||
Fixed | Base Salary | Fixed amount of compensation for service during the year and time in position | Rewards scope of responsibility, experience and individual performance. | |||
At-Risk | Annual Incentive Compensation | At-risk compensation dependent on Company and individual goal achievement | Promotes strong business results by rewarding value drivers, without creating an incentive to take excessive risk. | |||
Serves as key compensation vehicle for rewarding results and differentiating individual performance each | ||||||
Long-Term Incentive Compensation (Equity) | Equity grants are equally split between time-based and performance based RSUs | Relative performance metric creates incentive to outperform peers, with absolute metric rewarding performance | ||||
50% of PRSUs are | Three-year performance period supports retention and aligns pay with performance over an extended period of time. | |||||
50% of PRSUs are | Provides executives with a significant stake in the long-term financial success of the Company, aligned with | |||||
Time-based RSUs | Promotes longer-term retention. | |||||
Benefits | Retirement, Health and Welfare | 401k plan with | Provides market competitive benefits to attract and retain top talent. | |||
Competitive welfare benefits | ||||||
Severance | Severance Arrangements - Termination Due to Change in Control (Double-Trigger) | Severance and related benefits paid upon termination without cause or resignation for good reason following a change in control | Preserves objectivity when considering transactions in the best interest of stockholders. Equity provisions keep each executive whole in situations where shares may no longer exist, or awards cannot otherwise be replaced. | |||
Accelerated equity vesting upon termination post-change in control | Retains executives through a change in control. | |||||
Allows the Company to obtain releases of employment-related claims. | ||||||
Assists in attracting top talent. | ||||||
Severance Arrangements - Termination without cause or for Good Reason | Severance and related benefits paid upon termination without cause or resignation for good reason | The entirety of the severance benefits (cash and equity) assure executives of compensation in the event of the loss of employment. Assists |
19 |
Base Salary
We strive to pay base salaries that are market-competitive for a company of our size so as to attract and retain talented executives and to provide a secure fixed level of compensation. The Compensation Committee annuallyregularly reviews the base salaries of our executive officers and compares them to the salaries of senior management among the peer groupsgroup as well as other regional market data, bearing in mind that total estimated direct compensation opportunity is the principal comparative measure of the competitiveness of our program. Based on its own experience and such comparison, the Committee determines whether the
2020 Annual adjustments in base salary, if any, take into account individual performance, prior experience, position duties and responsibilities, internal equity and external market practices. The Compensation Committee largely relies on the CEO’s evaluation of each executive’s performance (other than his own) in deciding whether to approve merit increases for any executives in a given year.
At our 2019 Annual Meeting of Stockholders, our shareholders approved the Compensation Committee.
Name | Position | 2018 Annual Salary Rate | % increase from 2017 |
Norton | President, CEO and Director | $395,000 | N/A |
Trueblood | VP and CFO | $256,000 | N/A |
O'Halloran | VP and Chief Operations Officer | $230,000 | 12% |
Mote | VP and Chief Administrative Officer | $230,000 | 12% |
Allan | VP, General Counsel and Corporate Secretary | $250,000 | 9% |
The Annual Incentive Program for 2020 (“Annual Incentive Program”) is consistent with the Company’s compensation philosophy, regarding Mr. Norton’smeets the requirements of the Plan, and is in line with compensation and re-designs his compensation package going forward. Please see "
The following description summarizes Mr. Norton’s compensation as it was determined by the Compensation Committee at the beginningdesign of the Annual Incentive Program for the NEOs:
● | A pool of funds was established using the metric of free cash flow (“FCF”), a non-GAAP measure, with the amount of the pool calculated based on a pre-determined formula, setting forth threshold, target and maximum levels of achievement, and containing an SG&A multiplier (the “Pool”). We define FCF as EBITDA less CAPEX. | |
● | The FCF funding formula is based upon the budget approved by the Board of Directors, with the formula increasing or decreasing from 100% of target incentive amounts depending on achievement. A 15% increase or decrease in FCF will increase or decrease the bonus payout potential by 50%. A decrease of greater than 15% reduces the target payout to 0%. | |
● | The calculation of the Pool excludes the impact (positive and/or negative) of unusual, non-recurring or extraordinary items or expenses; charges for restructurings; discontinued operations; and acquisitions or divestitures. | |
● | Achievement is tied to whether a “safety incident” has occurred. A “safety incident” is defined as: A major safety and/or containment incident which results from negligence or misconduct of management or results from a material violation of state or federal operation, safety or construction regulations or if the responsible party fails to report the incident or to cooperate with the relevant authorities in responding to such incident. | |
● | Target achievement levels for each participant in the Annual Incentive Program were established by the Committee as a percentage of salary, as set forth in the chart below. |
Achievement of performance period in 2018 and as agreed in the 2016 CEO Employment Agreement.
Name | 2018 Target Bonus | Target Bonus $ | Actual Achievement % | Actual Payment | ||||
Trueblood | 15% | $ | 38,400 | 25% | $ | 64,000 | ||
O'Halloran | 15% | $ | 34,500 | 22.5% | $ | 51,750 | ||
Mote | 15% | $ | 34,500 | 22.5% | $ | 51,750 | ||
Allan | 15% | $ | 37,500 | 20% | $ | 50,000 |
NEO | ||||||
GOALS | TARGET As a % | ACHIEVEMENT LEVEL | ||||
Norton | Maximization of the utilization of the fleet Promotion of safety culture and environmental stewardship Acquisition and integration of the Alaska Tanker Company Implementation of enterprise software system | 100% of Base Salary | 125% of Target | |||
Trueblood | Financing for acquisitions and new vessels Management of capital Preparation for transition of accounting and financial control system to the new enterprise software system Transition to smaller reporting company status | 60% of Base Salary | 125% of Target | |||
O’Halloran | Improvement in safety and operational performance across the fleet Transition operations, SQE and purchasing departments to the new enterprise software system Transition and integration of the Alaska Tanker Company with Company practices Management of dry dock costs | 60% of Base Salary | 125% of Target | |||
Mote | ||||||
125% of Target |
Long Term Incentives
Consistent with distribution of the Special Bonus Pool as follows:
Participant | % Participation | First Half (earned) | Second Half (if earned) | Total (if earned) | ||||||
Norton | 35% | $ | 921,225 | $ | 921,225 | $ | 1,842,450 | |||
Trueblood | 15% | $ | 394,811 | $ | 394,811 | $ | 789,622 | |||
O'Halloran | 12.5% | $ | 329,009 | $ | 329,009 | $ | 658,018 | |||
Mote | 12.5% | $ | 329,009 | $ | 329,009 | $ | 658,018 | |||
Allan | 5% | $ | 131,604 | $ | 131,604 | $ | 263,208 | |||
Remainder deposited in the Annual Bonus Pool to be distributed to other employees (non NEOs) at the discretion of the CEO | 20% | $ | 526,414 | $ | 526,414 | $ | 1,052,828 | |||
Total | 100% | $ | 2,632,072 | $ | 2,632,072 | $ | 5,264,144 |
Each type of grant and the grant date values are describedshown in the table below. The grant date value for equity was set at 50%125% of the NEONEO’s base salary for all except Mr. Norton, whose grant date value was set at 250% of his base salary. Please refer to the Summary Compensation Table, Grants of Plan Based Awards Table and the Outstanding Equity Awards at Fiscal Year-End Table for additional details regarding these grants:
NEO | Total Grant Date Value | Time-Based RSUs (1)(2) | Performance-Based RSUs (1) (3) |
Norton | n/a | n/a | n/a |
Trueblood | $128,000 | $64,000 | $64,000 |
O'Halloran | $115,000 | $57,500 | $57,500 |
Mote | $115,000 | $57,500 | $57,500 |
Allan | $125,000 | $62,500 | $62,500 |
NEO | Total Grant Date Value | Time-Based RSUs (1)(2) | Performance-Based RSUs (1) (3) | |||||||||
Norton | $ | 1,062,500 | $ | 531,250 | $ | 531,250 | ||||||
Trueblood | $ | 375,000 | $ | 187,500 | $ | 187,500 | ||||||
O’Halloran | $ | 331,250 | $ | 165,625 | $ | 165,625 | ||||||
Mote | $ | 331,250 | $ | 165,625 | $ | 165,625 |
(1) | Represents the grant date value of the awards made on |
March 23, 2020. | |
(2) | Represents RSUs, one-third of which vested on |
2023. | |
(3) | The performance metrics governing these performance-based RSU grants are relative TSR and ROIC. Achievement relative to these goals will be measured at the conclusion of the three-year performance period |
21 |
Performance-Based RSU Awards
The 20182020 PRSU awards vest on December 31, 2020,2022, subject to the achievement of the respective performance metrics. One half of the grant is subject to a performance goal based on the Company's three-year TSR relative to the three-year TSR of the Index; the other half of the grant is subject to a performance goal based on the Company's cumulative ROIC relative to the Company's budgeted ROIC for the performance period. The vesting of these awards is subject to the Compensation Committee’s certification of the achievement of the articulated goals following the conclusion of the performance period.
Vesting of the TSR awards will be in accordance with the following schedule, using linear interpolation between the 40th and 50th percentiles and between the 50th and 75th percentiles:
Total Shareholder Return (TSR)
Company TSR relative to the TSR of the companies in the Index | Percentage of target RSUs that vest and become | |
Below 40th Percentile | —% | |
40th Percentile | 50% | |
50th Percentile | 100% | |
75th Percentile or above | 150% |
In the event that the Company's three‐yearCompany’s three-year TSR is greater than the median of the Index but still negative, a maximum of 100% of the target number of PRSUs governed by TSR may be earned. That is, there would be no upside for greater than target achievement if the Company's three‐yearCompany’s three-year TSR is negative. Should the Company reach the threshold level of performance for the performance period, 50% of the target number of TSR PRSUs would be earned.
Achievement of the ROIC awards will be in accordance with the following schedule, using linear interpolation between 80% and 100% attainment and between 100% and 120% attainment of the performance goal:
Return on Invested Capital (ROIC) | |
Performance attainment (as a % of performance goal) | Percentage of target PRSUs that vest and become non-forfeitable |
Below 80% | —% |
80% | 50% |
100% | 100% |
120% or above | 150% |
Return on Invested Capital (ROIC)
Performance attainment (as a % of performance goal) | Percentage of target PRSUs that vest and become non-forfeitable | |
Below 80% | —% | |
80% | 50% | |
100% | 100% | |
120% or above | 150% |
CEO Employment Agreements
Mr. Norton’s Employment Agreement (“the CEO Employment Agreement
Calendar Year | 2020 | 2019 | 2018 |
Base Salary | No less than $425,000 | $425,000, effective 1/1/2019 | $395,000, effective 7/17/2016 |
Annual Incentive Opportunity | Eligible for a target bonus equal to 100% of salary payable in cash based on achieving pre-determined performance criteria, with threshold and maximum determined annually. | Eligible for payment of his portion of the second half of the Special Bonus Pool if performance metrics are obtained. | $1,250,000 bonus award paid with 50% fully vested stock and 50% fully vested options based on individual goals and subject to a three (3) year holding requirement. |
Target cash bonus under the Company's annual incentive opportunity will be 0% in 2019. | |||
Long-Term Incentive Opportunity | Grant date value equal to 250% of base salary at target ($1,062,500). | Grant date value equal to 150% of base salary at target ($637,500). | N/A |
The number of shares to be granted to be determined using a 20-trading day VWAP. | The number of shares to be granted to be determined using a 20-trading day VWAP. | ||
Vesting criteria applicable to all NEO equity awards to be set by the Committee at the time of grant. | PRSU awards cliff vest at the end of a 3-year period based on metric achievement. RSU awards vest ratably over a 3-year period. | ||
Restrictive Covenants | Bound by typical restrictive covenants, including, but not limited to, non-competition, non-solicitation, non-disclosure, non-disparagement. | ||
Non-compete/non-solicitation period of 12 months from date of departure; provided, however, that in the event of a sale of all or substantially all of the assets or equity, the non-compete no longer applies. |
Base Salary | No less than $425,000 | |
Annual Incentive Opportunity | Eligible for a target bonus equal to 100% of salary payable in cash based on achieving predetermined performance criteria, with threshold and maximum determined annually. | |
Grant date value equal to 250% of base salary at target ($1,062,500). | ||
Long-Term Incentive Opportunity | The number of shares to be granted to be determined using a 20-trading day volume weighted average price. Vesting criteria applicable to all NEO equity awards to be set by the Committee at the time of grant. | |
Restrictive Covenants | Customary restrictive covenants, including, but not limited to, non-competition, non-solicitation, non-disclosure, non-disparagement. Non-compete/non-solicitation period of 12 months from date of departure; provided, however, that in the event of a sale of all or substantially all of the assets or equity, the non-compete no longer applies. |
The 2018 CEO Employment Agreement carried forward thecertain terms of the 2016 CEO Employment Agreement regarding Mr. Norton's performance-based bonus for the 2018 fiscal year with a target value of $1,250,000, with metrics based on the relative achievement of individual and company performance objectives that were established by the Committee at the beginning of the 2018 fiscal year.Norton’s prior employment agreement. Mr. Norton will retain, continue to vest in, and continue to hold equity awards granted to him prior to the date of the 2018 CEO Employment Agreement. Mr. Norton has agreed to hold all shares of OSG’s Class A Common Stock received that immediately vested including any shares acquired under the 2018 Bonus, until the earliest to occur of (x) a Change in Control (as defined in the Management Incentive Compensation Plan); (y) the Date of Separation from Service (as defined in the 2018 CEO Employment Agreement), solely in the event of a termination of his employment by OSG without Cause or by him for Good Reason (as such terms are defined in the 2018 CEO Employment Agreement); and (z) the third (3rd) anniversary of the acquisition of any such shares. Mr. Norton is required to elect to use net settlement to satisfy any exercise price or taxes due thereon.
The time-based RSUs will vest ratably, annually on each of the first three anniversaries of grant. The 2019 performance-based RSU awards cliff vest on December 31, 2021, subject to the achievement of performance goals based on the Company's three-year TSR relative to the three-year TSR of the Index, and the Company's cumulative ROIC relative to the Company's budgeted ROIC for the performance period. The number of shares subject to the grant was determined by dividing the grant date value by the volume weighted average price ("VWAP") for the 20 trading days preceding the date of grant.
Upon Separation of Service/Treatment of Leaving | |||
Benefit | Effective 12/15/2018 | ||
“Accrued Benefits” include: | |||
Earned but unpaid base salary | |||
Earned, but unpaid annual incentives, if any | |||
Accrued but unused vacation days, if any | |||
Expense reimbursement | |||
Salary Continuation | |||
Termination Without Cause/ Resignation With Good Reason | |||
Twelve (12) months base salary continuation at the salary rate in effect as of the date of termination | |||
Annual Incentive | |||
Annual incentive, not pro-rated, for the year of termination, to the extent that the applicable performance goals are achieved and annual incentives are paid | |||
Pro Rata Special Bonus Pool (To sunset following the 2019 Performance Year) | |||
Pro-rated to reflect the number of days worked during the performance period as of the date of separation | |||
Treatment Of Outstanding (Unvested) Equity Compensation | |||
Time-based equity to accelerate and vest in full | |||
A pro rata portion of the performance-based equity to remain in force and vest at the conclusion of the performance period, to the extent the performance goals are achieved and the performance-based equity vests | |||
Termination For Cause/Voluntary Resignation (Without Good Reason) | Accrued Benefits (same as stated above) | ||
All vested/settled equity is retained | |||
Vested options remain exercisable until the earlier of (i) one year from the date of termination or (ii) the expiration of the option | |||
All unvested equity (both time- and performance-based) to be forfeited and canceled | |||
Restructuring grant is subject to clawback |
Termination Due To Death Or Permanent Disability | Accrued Benefits (same as stated above) | |
All vested/settled equity is retained | ||
Vested options remain exercisable until the earlier of (i) one year from the date of termination or (ii) the expiration of the option | ||
All unvested time-based equity accelerates and vests | ||
All unvested performance-based equity to be forfeited and canceled | ||
Termination Without Cause/Resignation With Good Reason Within Twenty-Four (24) Months Following A Change In Control (Double Trigger) | Double-Trigger Change In Control (requires both CIC and Termination for payout) | |
Accrued Benefits (same as stated above) | ||
Salary Continuation | ||
Twelve | ||
Annual Incentive | ||
Annual incentive, paid at target, for the year of termination | ||
Treatment of Outstanding (Unvested) Equity Compensation | ||
Time-based equity to accelerate and vest in full | ||
Performance-based equity subject to accelerated |
The forgoing description is qualified in its entirety by reference to the terms of Mr. Norton's 2016 CEO Employment Agreement, which was valid only untilis an exhibit to the Company’s Annual Report on 10-K for the year ended December 14, 2018 when it was superseded31,2020 and incorporated by the 2018 CEO Employment Agreement, Mr. Norton’s compensation package was heavily weighted to provide more equity compensation than cash compensation. The 2016 CEO Employment Agreement is relevant in that the compensation disclosed in this CD&A and in the compensation tables contained within this Proxy Statement were based on the terms of this agreement.reference herein.
23 |
The 2016 CEO Employment Agreement provided for a single trigger change in control, as defined in the Management Plan, which provision would have expired in July 2019. However, this provision was replaced in the 2018 CEO Employment Agreement with a double trigger change in control provision. Please also see the discussion in "
Say on Pay Results" above in this CD&A.
The Company has entered into employment agreements with Messrs. Trueblood, O'Halloran,O’Halloran, and Mote, and with Ms. Allan, all of which contain similar terms. TheEach employment agreements provideagreement provides for an annual base salariessalary and a target bonus of at least 15% of each executive'sexecutive’s annual base salary. If the executive is actively employed on December 31, 2018 and in good standing, the executive will be eligible to participate in the Special Bonus Pool. In addition, eachEach executive may receive additional equity awards from time to time inat the discretion of the Compensation Committee, which awards will have a total target value of at least 50% of such executive'sexecutive’s base salary.
The employment agreements provide for severance benefits in the event of termination without cause or resignation for good reason as follows: (i) accrued but unpaid amounts through the date of separation of service; (ii) 12 months'months’ continuation of annual base salary; (iii) the executive'sexecutive’s annual bonus for the year of separation pro-rated based on performance factor achievement and the number of days in the fiscal year in which he or she was employed; (iv) any compensation to which the executive is entitled under the Special Bonus Pool pro-rated based on the number of days in the fiscal year in which he or she was employed; and (v)(iv) accelerated vesting of any unvested time-based equity awards.
If, during the two-year period following a change in control of the Company, an executive’s employment is terminated without cause or the executive resigns for good reason, the employment agreements provide for severance benefits as follows: (i) the executive'sexecutive’s target annual bonus for the year of separation; (ii) any compensation to which the executive is entitled under the Special Bonus Pool; and (iii)(ii) accelerated vesting of any unvested equity awards.
Each executive agreed to a non-competition and non-solicitation obligation during the executive'sexecutive’s employment term and for 12 months thereafter; eachthereafter. Each executive also agreed to confidentiality and non-disparagement obligations during and following employment with the Company. The executives also agreedCompany, and to timely delivery of a release in connection with termination of the executive'sexecutive’s service. Severance and other benefits are conditioned on compliance with these covenants.
The forgoing description is qualified in its entirety by reference to the employment agreements referred to above, which are exhibits to the Company’s Annual Report on 10-K for the year ended December 31,2020 and incorporated by reference herein.
Additional Information
Benefits
In general, we provide benefits to our employees (including our NEOs) that we believe are important to maintain a competitive total compensation program. Benefits are designed to provide a reasonable level of retirement income and to provide a safety net of protection against the financial concerns and catastrophes that can result from illness, disability or death.
We provide a tax-qualified defined contribution employee benefit plan to employees known as the OSG Ship Management Inc. Savings Plan (the “Savings Plan”). Under the Savings Plan, eligible employees may contribute, on a pre-tax basis, an amount up to the limit imposed by the Internal Revenue Code Section 401(k). In 2018,2020, the Company matched 100% of the first 4% of a participant’s pre-tax contributions and then 50% of pre-tax contributions in excess of 4% but not in excess of 8%.
2021 Compensation Program
In the first quarter of Section 162(m) on2021, the Compensation
The Summary Compensation Table includes individual compensation information for services by the NEOs in all capacities for the Company and our subsidiaries.
Name and Principal Position | Year | Salary (1) | Bonus | Stock Awards (2)(3)(4)(5) | Option Awards (3)(6) | Non-Equity Incentive Plan Compensation (7) | All Other Compensation (8) | Total | |||||||||||||
Samuel H. Norton (3) | 2018 | $ | 395,000 | — | $ | 1,375,000 | $ | 625,000 | $ | 921,225 | $ | 18,457 | $ | 3,334,682 | |||||||
President and | 2017 | $ | 395,000 | — | $ | 629,166 | $ | 485,945 | — | $ | 25,573 | $ | 1,535,684 | ||||||||
Chief Executive Officer | 2016 | $ | 182,308 | — | $ | 2,082,809 | $ | 660,936 | — | $ | 81,055 | $ | 3,007,108 | ||||||||
Richard L. Trueblood (9) | 2018 | $ | 256,000 | — | $ | 128,000 | — | $ | 458,811 | $ | 11,332 | $ | 854,143 | ||||||||
Vice President and | 2017 | $ | 109,292 | — | $ | 98,690 | — | — | — | $ | 207,982 | ||||||||||
Chief Financial Officer | |||||||||||||||||||||
Patrick J. O'Halloran (10) | 2018 | $ | 230,000 | — | $ | 115,000 | — | $ | 380,759 | $ | 16,236 | $ | 741,995 | ||||||||
Vice President and | 2017 | $ | 207,116 | — | $ | 165,032 | $ | 34,167 | $ | 51,250 | $ | 15,734 | $ | 473,299 | |||||||
Chief Operations Officer | 2016 | $ | 185,483 | — | — | — | $ | 99,229 | $ | 27,217 | $ | 311,929 | |||||||||
Damon M. Mote (10) | 2018 | $ | 230,000 | — | $ | 115,000 | — | $ | 380,759 | $ | 17,986 | $ | 743,745 | ||||||||
Vice President and | 2017 | $ | 207,116 | — | $ | 165,032 | $ | 34,167 | $ | 46,125 | $ | 17,534 | $ | 469,974 | |||||||
Chief Administrative Officer | 2016 | $ | 185,483 | — | — | — | $ | 99,229 | $ | 27,217 | $ | 311,929 | |||||||||
Susan Allan (9) | 2018 | $ | 250,000 | — | $ | 125,000 | — | $ | 181,604 | $ | 17,986 | $ | 574,590 | ||||||||
Vice President, General Counsel | 2017 | $ | 231,692 | — | $ | 76,666 | $ | 38,333 | $ | 46,000 | $ | 9,186 | $ | 401,877 | |||||||
and Corporate Secretary |
Name and Principal Position | Year | Salary | Bonus | Stock Awards (1)(2)(3)(4) | Option Awards | Non-Equity Incentive Plan Compensation (5) | All Other Compensation (6) | Total | ||||||||||||||||||||||||
Samuel H. Norton | 2020 | $ | 425,000 | - | $ | 1,062,500 | - | $ | 531,250 | $ | 19,266 | $ | 2,038,016 | |||||||||||||||||||
President and | 2019 | $ | 425,000 | - | $ | 637,500 | - | $ | 921,225 | $ | 18,757 | $ | 2,002,482 | |||||||||||||||||||
Chief Executive Officer | ||||||||||||||||||||||||||||||||
Richard L. Trueblood | 2020 | $ | 300,000 | - | $ | 375,000 | - | $ | 225,000 | $ | 18,718 | $ | 918,718 | |||||||||||||||||||
Vice President and | 2019 | $ | 288,000 | - | $ | 216,000 | - | $ | 394,811 | $ | 18,286 | $ | 917,097 | |||||||||||||||||||
Chief Financial Officer | ||||||||||||||||||||||||||||||||
Patrick J. O’Halloran | 2020 | $ | 265,000 | - | $ | 331,250 | - | $ | 198,750 | $ | 18,718 | $ | 813,718 | |||||||||||||||||||
Vice President and | 2019 | $ | 253,000 | - | $ | 189,750 | - | $ | 329,009 | $ | 18,286 | $ | 790,045 | |||||||||||||||||||
Chief Operating Officer | ||||||||||||||||||||||||||||||||
Damon M. Mote | 2020 | $ | 265,000 | - | $ | 331,250 | - | $ | 198,750 | $ | 18,718 | $ | 813,718 | |||||||||||||||||||
Vice President and | 2019 | $ | 253,000 | - | $ | 189,750 | - | $ | 329,009 | $ | 18,286 | $ | 790,045 | |||||||||||||||||||
Chief Administrative Officer |
(1) |
On March 23, |
(2) | On March |
(3) | On March 23, 2020, each of the NEOs received time-based equity awards, |
their continued employment. | |
(4) | On March 22, 2019, each of the NEOs received time-based equity awards, one-third of which vested on March 22, 2020 and one-third of which will vest on each of March 22, 2021 and 2022, subject to their continued employment. |
(5) | For 2020, the amounts reflect |
award. | |
(6) | See the “All Other Compensation Table” for additional information. |
All Other Compensation Table
The following table describes each component of the All Other Compensation column for 20182020 in the Summary Compensation Table.
Name | Savings Plan Matching Contribution (1) | Other (2) | Total | |||||||||
Norton | $ | 16,500 | $ | 1,957 | $ | 18,457 | ||||||
Trueblood | $ | 9,846 | $ | 1,486 | $ | 11,332 | ||||||
O'Halloran | $ | 14,750 | $ | 1,486 | $ | 16,236 | ||||||
Mote | $ | 16,500 | $ | 1,486 | $ | 17,986 | ||||||
Allan | $ | 16,500 | $ | 1,486 | $ | 17,986 |
Type of award | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) | Estimated Future Payouts Under Equity Incentive Plan Awards (2) (3) | All Other Stock Awards: Number of Shares of Stock or Stock Units (4)(5) | All Other Option Awards: Number of Securities Underlying Options (6) | Exercise or Base Price of Option Awards | Grant Date Fair Value of Stock and Option Awards (7) | |||||||||||||||||||||||
Grant Date | Threshold | Target | Maximum | Threshold | Target | Maximum | |||||||||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | ($/Sh) | |||||||||||||||||||||||
Norton | Restructuring grant | 12/15/2018 | — | — | — | — | — | — | $ | 750,000 | — | — | $ | 750,000 | |||||||||||||||
CEO annual bonus | 4/5/2018 | — | — | — | — | $ | 1,250,000 | — | — | — | $ | 1.82 | $ | 1,250,000 | |||||||||||||||
Trueblood | Annual incentive plan | 4/5/2018 | — | $38,400 | — | — | — | — | — | — | — | — | |||||||||||||||||
PRSU- ROIC | 2/8/2018 | — | — | — | $ | 16,000 | $ | 32,000 | $ | 48,000 | — | — | — | $ | 32,000 | ||||||||||||||
PRSU- TSR | 2/8/2018 | — | — | — | $ | 16,000 | $ | 32,000 | $ | 48,000 | — | — | — | $ | 32,000 | ||||||||||||||
RSUs | 2/8/2018 | — | — | — | — | — | — | $ | 64,000 | — | — | $ | 64,000 | ||||||||||||||||
O’Halloran | Annual incentive plan | 4/5/2018 | — | $34,500 | — | — | — | — | — | — | — | — | |||||||||||||||||
PRSU- ROIC | 2/8/2018 | — | — | — | $ | 14,375 | $ | 28,750 | $ | 43,125 | — | — | — | $ | 28,750 | ||||||||||||||
PRSU- TSR | 2/8/2018 | — | — | — | $ | 14,375 | $ | 28,750 | $ | 43,125 | — | — | — | $ | 28,750 | ||||||||||||||
RSUs | 2/8/2018 | — | — | — | — | — | — | $ | 57,500 | — | — | $ | 57,500 | ||||||||||||||||
Mote | Annual incentive plan | 4/5/2018 | — | $34,500 | — | — | — | — | — | — | — | — | |||||||||||||||||
PRSU- ROIC | 2/8/2018 | — | — | — | $ | 14,375 | $ | 28,750 | $ | 43,125 | — | — | — | $ | 28,750 | ||||||||||||||
PRSU- TSR | 2/8/2018 | — | — | — | $ | 14,375 | $ | 28,750 | $ | 43,125 | — | — | — | $ | 28,750 | ||||||||||||||
RSUs | 2/8/2018 | — | — | — | — | — | — | $ | 57,500 | — | — | $ | 57,500 | ||||||||||||||||
Allan | Annual incentive plan | 4/5/2018 | — | $37,500 | — | — | — | — | — | — | — | — | |||||||||||||||||
PRSU- ROIC | 2/8/2018 | — | — | — | $ | 15,625 | $ | 31,250 | $ | 46,875 | — | — | — | $ | 31,250 | ||||||||||||||
PRSU- TSR | 2/8/2018 | — | — | — | $ | 15,625 | $ | 31,250 | $ | 46,875 | — | — | — | $ | 31,250 | ||||||||||||||
RSUs | 2/8/2018 | — | — | — | — | — | — | $ | 62,500 | — | — | $ | 62,500 |
Name | Savings Plan Matching Contribution (1) | Other (2) | Total | |||||||||
Norton | $ | 17,100 | $ | 2,166 | $ | 19,266 | ||||||
Trueblood | $ | 17,100 | $ | 1,618 | $ | 18,718 | ||||||
O’Halloran | $ | 17,100 | $ | 1,618 | $ | 18,718 | ||||||
Mote | $ | 17,100 | $ | 1,618 | $ | 18,718 |
(1) |
Savings Plan. | |
(2) |
The following table provides information as of December 31, 20182020 concerning the holdings of stock options and stock awards by the NEOs. This table includes unexercised and unvested option and stock awards. The market value of the stock awards is based on the market price of the Company’s Class A Common Stock at the close of business on December 31, 2018,2020, which was $1.66$2.14 per share.
Option Awards | Stock Awards | |||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($) | |||||||||||||||
Norton | 2/8/18 | 494,118 | — | (3) | $ | 1.70 | 2/8/2028 | — | — | — | — | |||||||||||||
3/23/17 | 5,879 | 11,758 | (2) | $ | 4.04 | 3/23/2027 | 5,501 | $ | 9,132 | 6,187 | (7 | ) | $ | 10,270 | ||||||||||
8/3/16 | 198,544 | 99,274 | (1) | $ | 5.57 | 8/3/2026 | 118,752 | (4) | $ | 197,128 | — | — | ||||||||||||
Trueblood | 2/8/18 | — | — | — | 37,647 | (6) | $ | 62,494 | 37,648 | (8 | ) | $ | 62,496 | |||||||||||
O'Halloran | 2/8/18 | — | — | — | 33,824 | (6) | $ | 56,148 | 33,824 | (8 | ) | $ | 56,148 | |||||||||||
3/23/17 | 6,026 | 12,052 | (2) | $ | 4.04 | 3/23/2027 | 5,638 | (5) | $ | 9,359 | 6,343 | (7 | ) | $ | 10,529 | |||||||||
Mote | 2/8/18 | — | — | — | 33,824 | (6) | $ | 56,148 | 33,824 | (8 | ) | $ | 56,148 | |||||||||||
3/23/17 | 6,026 | 12,052 | (2) | $ | 4.04 | 3/23/2027 | 5,638 | (5) | $ | 9,359 | 6,343 | (7 | ) | $ | 10,529 | |||||||||
Allan | 2/8/18 | — | — | — | 36,765 | (6) | $ | 61,030 | 36,764 | (8 | ) | $ | 61,028 | |||||||||||
3/23/17 | 6,760 | 13,522 | (2) | $ | 4.04 | 3/23/2027 | 6,326 | (5) | $ | 10,501 | 7,116 | (7 | ) | $ | 11,813 |
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($) | |||||||||||||||||||||||||
Norton | 3/23/20 | — | — | — | — | 261,571 | (3) | $ | 559,762 | 130,875 | (5) | $ | 280,073 | |||||||||||||||||||||
3/22/19 | — | — | — | — | 105,115 | (3) | $ | 241,765 | 173,439 | (4) | $ | 371,159 | ||||||||||||||||||||||
2/8/19 | 612,745 | (2) | — | $ | 1.82 | — | — | — | — | — | ||||||||||||||||||||||||
2/8/18 | 494,118 | (2) | — | $ | 1.70 | 2/8/2028 | — | — | — | — | ||||||||||||||||||||||||
3/23/17 | 17,637 | (1) | — | $ | 4.04 | 3/23/2027 | — | — | — | — | ||||||||||||||||||||||||
8/3/16 | 297,818 | (1) | — | $ | 5.57 | 8/3/2026 | — | — | — | — | ||||||||||||||||||||||||
Trueblood | 3/23/20 | — | — | — | — | 92,319 | (3) | $ | 197,563 | 46,160 | (5) | $ | 98,782 | |||||||||||||||||||||
3/22/19 | — | — | — | — | 35,615 | (3) | $ | 76,216 | 58,766 | (4) | $ | 125,759 | ||||||||||||||||||||||
2/8/18 | — | — | — | — | 12,549 | (3) | $ | 26,855 | — | — | ||||||||||||||||||||||||
O’Halloran | 3/23/20 | — | — | — | — | 81,548 | (3) | $ | 174,513 | 40,744 | (5) | $ | 87,192 | |||||||||||||||||||||
3/22/19 | — | — | — | — | 31,287 | (3) | $ | 66,954 | 51,624 | (4) | $ | 110,475 | ||||||||||||||||||||||
2/8/18 | — | — | — | — | 11,275 | (3) | $ | 24,129 | — | — | ||||||||||||||||||||||||
3/23/17 | 18,078 | (1) | — | $ | 4.04 | 3/23/2027 | — | — | — | — | ||||||||||||||||||||||||
Mote | 3/23/20 | — | — | — | — | 81,548 | (3) | $ | 174,513 | 40,744 | (5) | $ | 87,192 | |||||||||||||||||||||
3/22/19 | — | — | — | — | 31,287 | (3) | $ | 66,954 | 51,624 | (4) | $ | 110,475 | ||||||||||||||||||||||
2/8/18 | — | — | — | — | 11,275 | (3) | $ | 24,129 | — | — | ||||||||||||||||||||||||
3/23/17 | 18,078 | (1) | — | $ | 4.04 | 3/23/2027 | — | — | — | — |
(1) | One-third of these options to purchase shares of Class A Common Stock |
respectively. | |
prior employment agreement. | |
One-third of these time-based RSUs |
These performance-based RSU awards are comprised of two separate grants, both of which |
# of shares | Share payout if the current trends are realized | |||||||
Name | PRSU Name | Threshold | Target | Maximum | ||||
Norton | TSR | — | 4,125 | 6,187 | 6,187 | |||
ROIC | 2,062 | 4,125 | 6,187 | |||||
O'Halloran | TSR | — | 4,229 | 6,343 | 6,343 | |||
ROIC | 2,114 | 4,229 | 6,343 | |||||
Mote | TSR | — | 4,229 | 6,343 | 6,343 | |||
ROIC | 2,114 | 4,229 | 6,343 | |||||
Allan | TSR | — | 4,744 | 7,116 | 7,116 | |||
ROIC | 2,372 | 4,744 | 7,116 |
# of shares | Share payout if the current trends are realized | |||||||
Name | PRSU Name | Threshold | Target | Maximum | ||||
Trueblood | TSR | 9,412 | 18,824 | 28,236 | 37,648 | |||
ROIC | 9,412 | 18,824 | 28,236 | |||||
O'Halloran | TSR | 8,456 | 16,912 | 25,368 | 33,824 | |||
ROIC | 8,456 | 16,912 | 25,368 | |||||
Mote | TSR | 8,456 | 16,912 | 25,368 | 33,824 | |||
ROIC | 8,456 | 16,912 | 25,368 | |||||
Allan | TSR | 9,191 | 18,382 | 27,573 | 36,764 | |||
ROIC | 9,191 | 18,382 | 27,573 |
Option Awards | Stock Awards | ||||||||||||||
Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting | |||||||||||
Norton | — | — | 810,379 | (1) | $ | 1,645,058 | |||||||||
Trueblood | — | — | — | — | |||||||||||
O'Halloran | — | — | 2,819 | (2) | $ | 7,358 | |||||||||
Mote | — | — | 2,819 | (2) | $ | 7,358 | |||||||||
Allan | — | — | 3,162 | (2) | $ | 8,253 |
# of shares | Share payout if the current trends are | |||||||||||||
Name | PRSU Name | Target | Trend | realized | ||||||||||
Norton | TSR | 78,836 | 118,254 | 173,439 | ||||||||||
ROIC | 78,836 | 55,185 | ||||||||||||
Trueblood | TSR | 26,712 | 40,068 | 58,766 | ||||||||||
ROIC | 26,712 | 18,698 | ||||||||||||
O’Halloran | TSR | 23,465 | 35,198 | 51,624 | ||||||||||
ROIC | 23,465 | 16,426 | ||||||||||||
Mote | TSR | 23,465 | 35,198 | 51,624 | ||||||||||
ROIC | 23,465 | 16,426 |
(5) | |
These performance-based RSU awards are comprised of two separate grants, both of which cliff vest with performance periods ending on December 31, 2022. The |
Date of Award | Vesting Date | Number of Shares acquired on Vesting | Market Price at Vesting | Value Realized on Vesting | |
7/17/2016 | 1/1/2018 | 118,752 | $2.74 | $325,380 | |
3/23/2017 | 3/23/2018 | 2,750 | $2.61 | $7,178 | |
2/8/2018 | 2/8/2018 | 330,882 | $1.70 | $562,500 | |
12/15/2018 | 12/15/2018 | 357,995 | $2.095 | $750,000 | |
Total | 810,379 | $1,645,058 |
# of shares | Share payout if the current trends are | |||||||||||||
Name | PRSU Name | Target | Trend | realized | ||||||||||
Norton | TSR | 130785 | 130,785 | 130,785 | ||||||||||
ROIC | 130785 | 0 | ||||||||||||
Trueblood | TSR | 46160 | 46,160 | 46,160 | ||||||||||
ROIC | 46160 | 0 | ||||||||||||
O’Halloran | TSR | 40774 | 40,774 | 40,774 | ||||||||||
ROIC | 40774 | 0 | ||||||||||||
Mote | TSR | 40774 | 40,774 | 40,774 | ||||||||||
ROIC | 40774 | 0 |
27 |
The following table discloses the amounts that would have been payable to each NEO upon termination of his or her employment, assuming that such termination occurred on December 31, 2018.2020. The table excludes amounts that are available generally to all salaried employees, such as amounts payable under the Savings Plan. The market value of the stock awards is based on the market price of the Company'sCompany’s Class A Common Stock at the close of business on December 31, 2018,2020, which was $1.66$2.14 per share.
Event | Norton | Trueblood | O’Halloran | Mote | Allan | ||||||||||
Involuntary Termination Without Cause or Voluntary Termination for Good Reason | |||||||||||||||
Cash severance (1) | $ | 395,000 | $ | 256,000 | $ | 230,000 | $ | 230,000 | $ | 250,000 | |||||
Annual Bonus (2) | $ | 1,250,000 | $ | 64,000 | $ | 51,750 | $ | 51,750 | $ | 50,000 | |||||
Acceleration & Continuation of Equity Awards (3) (4) | $ | 213,107 | $ | 62,494 | $ | 65,507 | $ | 65,507 | $ | 71,531 | |||||
Pro-rata Special Bonus Pool (5) | $ | 921,255 | $ | 394,811 | $ | 329,009 | $ | 329,009 | $ | 131,604 | |||||
Total | $ | 2,779,362 | $ | 777,305 | $ | 676,266 | $ | 676,266 | $ | 503,135 | |||||
Death / Disability | |||||||||||||||
Pro rata Annual Bonus (2) | — | $ | 64,000 | $ | 51,750 | $ | 51,750 | $ | 50,000 | ||||||
Acceleration & Continuation of Equity Awards (3) | $ | 206,260 | $ | 62,494 | $ | 65,507 | $ | 65,507 | $ | 71,531 | |||||
Pro-rata Special Bonus Pool (5) | — | $ | 394,811 | $ | 329,009 | $ | 329,009 | $ | 131,604 | ||||||
Total | $ | 206,260 | $ | 521,305 | $ | 446,266 | $ | 446,266 | $ | 253,135 | |||||
Change In Control | |||||||||||||||
Cash severance (1) | $ | 395,000 | $ | 256,000 | $ | 230,000 | $ | 230,000 | $ | 250,000 | |||||
Annual Bonus (6) | $ | 1,250,000 | $ | 38,400 | $ | 34,500 | $ | 34,500 | $ | 37,500 | |||||
Acceleration & Continuation of Equity Awards (7) | $ | 219,954 | $ | 93,742 | $ | 107,621 | $ | 107,621 | $ | 115,114 | |||||
Pro-rata Special Bonus Pool (4) | $ | 921,255 | $ | 394,811 | $ | 329,009 | $ | 329,009 | $ | 131,604 | |||||
Total | $ | 2,786,209 | $ | 782,953 | $ | 701,130 | $ | 701,130 | $ | 534,218 |
Event | Norton | Trueblood | O’Halloran | Mote | ||||||||||||
Involuntary Termination Without Cause or Voluntary Termination for Good Reason | ||||||||||||||||
Cash severance (1) | $ | 425,000 | $ | 300,000 | $ | 265,000 | $ | 265,000 | ||||||||
Pro-rata Annual Bonus (2) | $ | 531,250 | $ | 225,000 | $ | 198,750 | $ | 198,750 | ||||||||
Acceleration & Continuation of Equity Awards (3) | $ | 1,609,729 | $ | 300,634 | $ | 265,595 | $ | 265,595 | ||||||||
Total | $ | 2,565,979 | $ | 825,634 | $ | 729,345 | $ | 729,345 | ||||||||
Death / Disability | ||||||||||||||||
Pro rata Annual Bonus (2) | $ | — | $ | 225,000 | $ | 198,750 | $ | 198,750 | ||||||||
Acceleration & Continuation of Equity Awards (3) | $ | 780,186 | $ | 300,634 | $ | 265,595 | $ | 265,595 | ||||||||
Total | $ | 780,186 | $ | 525,634 | $ | 464,345 | $ | 464,345 | ||||||||
Change In Control | ||||||||||||||||
Cash severance (1) | $ | 425,000 | $ | 300,000 | $ | 265,000 | $ | 265,000 | ||||||||
Annual Bonus (4) | $ | 425,000 | $ | 180,000 | $ | 159,000 | $ | 159,000 | ||||||||
Acceleration & Continuation of Equity Awards (5) | $ | 1,815,494 | $ | 554,028 | $ | 489,467 | $ | 489,467 | ||||||||
Total | $ | 2,665,494 | $ | 1,034,028 | $ | 913,467 | $ | 913,467 |
(1) | The cash severance payment is equal to 12 months of base salary.
ADVISORY VOTE ON THE APPROVAL OF THE COMPENSATION OF THE NAMED EXECUTIVE OFFICERS (PROPOSAL NO. 2) Stockholders are being provided with the opportunity to cast an advisory vote on the compensation of the NEOs for 2020. As more fully described in to:
The Compensation Committee and the Board believe that the design of the executive compensation program, and hence the compensation awarded to the NEOs, fulfills these objectives. Accordingly, at the Annual Meeting, stockholders are asked to vote on the following resolution: RESOLVED, that the stockholders of the Company hereby approve, As an advisory vote, the results of the vote will not be binding on the Board or the Company. However, the Board and the Compensation Committee value your opinion and will consider the outcome of the vote when making future decisions on the compensation of the NEOs and have done in the past. The Board recommends a vote the resolution set forth above and approval of the compensation of the Named Executive Officers for
AUDIT COMMITTEE REPORT Management has primary responsibility for preparing the consolidated financial statements of the Company, for maintaining effective internal control over financial reporting and for assessing the effectiveness of internal control over financial reporting. The In fulfilling its oversight responsibilities, the Audit Committee met with management and the Standards No. 1301 (Communications with Audit Committees). The Committee also reviewed The Company’s independent registered public accounting firm also provided to the Audit Committee the written disclosures and letter required by PCAOB Rule 3526 (Communication with Audit Committees Concerning Independence), and the Audit Committee discussed with the independent registered public accounting firm Based upon the Audit Committee’s discussions with management and the Company’s independent registered public accounting firm, the Audit Committee’s review of the representations of management, the certifications of the
RATIFICATION OF APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PROPOSAL NO. Grant Thornton LLP, certified public accountants EY’s audit reports During the Company’s two fiscal years ended December 31, 2019 and 2018 and the subsequent interim period through April 6, 2020 with EY, and during the Company’s fiscal year ended December 31, Neither the Company nor anyone acting on its behalf has consulted with Stockholder ratification of the appointment of Fees Paid to the Independent Registered Public Accounting Firm The following table represents professional audit services fees incurred by OSG to Grant Thornton and EY for the audit of our annual financial statements for the fiscal year ended December 31, 2020 and to EY for the audit of our annual financial statements for the fiscal
The Audit Committee considered whether the provision of services described above under Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services The Audit Committee has established policies and procedures for pre-approving audit and permissible non-audit work performed by its independent registered public accounting firm. As set forth in the pre-approval policies and procedures, unless a type of service has received general pre-approval, it will require specific pre-approval by the Audit Committee if it is to be provided by the independent auditor. Any proposed services exceeding pre-approved cost levels require specific pre-approval by the Audit Committee. All fees have been approved by the Audit Committee in accordance with these policies and procedures. The Audit Committee and the Board of Directors recommend a vote selection of OWNERSHIP OF CLASS A COMMON STOCK BY DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN OTHER BENEFICIAL OWNERS The tables below set forth Beneficial ownership for the purposes of the following tables is determined in accordance with the rules and regulations of the SEC. Those rules generally provide that a person is the beneficial owner of shares if such person has or shares the power to vote or direct the voting of shares, or to dispose or direct the disposition of shares or has the right to acquire such powers within 60 Directors and Executive Officers The table below sets forth information as to the
* Less than 1%
Other Beneficial Owners The following table sets forth information as of the Measurement Date (except as otherwise noted) with respect to persons known by us to be the beneficial owners of more than 5% of our Class A Common Stock, based solely on the information reported by such persons in their Schedule 13D and 13G filings with the SEC.
The following table provides information as of December 31, which have been approved by the
* Consists of SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Under the securities laws of the United States, the Company’s directors, executive officers and any persons holding more than ten percent (10%) of the
INFORMATION CONCERNING SOLICITATION AND VOTING Proxies are being solicited on behalf of the Board of OSG for use at the Annual Meeting to be held virtually on Thursday, May Any stockholder giving a proxy may revoke it at any time before it is exercised at the meeting. Record Date, Shares Outstanding and Voting Only stockholders of record at the close of business on April All shares represented by an eligible proxy will be voted at the meeting in accordance with the instructions provided therein. If no such instructions are provided, the proxy will be voted:
Each of the election of directors, the advisory vote to approve the compensation of the NEOs Some of the Company’s stockholders hold their shares through a broker, trustee, or other nominee rather than directly in their own names. As summarized below, there are some distinctions between shares held of record and those shares owned beneficially.
As a stockholder of record, you may vote by one of the following methods:
If your shares are held through a broker, bank, trustee or other nominee, you will receive a request for voting instructions with respect to your shares of Common Stock from the broker, bank, trustee or other nominee. You should respond to the request for voting instructions in the manner specified by the broker, bank, trustee or other nominee. If you have questions about voting your shares, you should contact your broker, bank, trustee or other nominee. If you hold your shares through a broker, bank, trustee or other nominee and you wish to vote It is very important that you are represented at the meeting and that your shares are voted. We urge you to vote as soon as possible by telephone, over the Internet or by marking, signing and returning your proxy or voting instruction card, even if you plan to attend the Annual Meeting. To conduct the business of the Annual Meeting, we must have a quorum. The presence As all of these matters are very important to the Company, we urge you to vote your shares by telephone, over the Internet or by marking, signing and returning your proxy or voting instruction card. Expenses The cost of soliciting proxies for the meeting will be borne by the Company. The Company will also reimburse brokers and others who are only record holders of the Proposals for Stockholder proposals submitted under the SEC rules for inclusion in the Proxy Statement for the 2022 annual meeting must be received no later than December 14, 2021. Stockholder proposals submitted under the SEC rules must be submitted in writing to our Corporate Secretary at our principal offices and comply with the proxy rules. Any stockholder who wishes to propose a matter for action at the A stockholder may recommend a person as a nominee for director by writing to the Corporate Secretary of the Company. Recommendations must be received by February
OTHER MATTERS The Board is not aware of any matters to be presented at the The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as The |